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City of Powell River treatment plant costs outlined

Chief administrative officer provides rundown on progress of project
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INITIATIVES HIGHLIGHTED: City of Powell River chief administrative officer Russell Brewer responded to questions from the Westview Ratepayers Society regarding the construction of the consolidated wastewater treatment plant in Townsite. Contributed photo

City of Powell River chief administrative officer Russell Brewer appeared before the Westview Ratepayers Society (WRS) to highlight city initiatives surrounding the consolidated wastewater treatment plant.

At the February 28 virtual meeting, Brewer responded to written questions that the WRS had prepared for him. Regarding the consolidated wastewater treatment plant, Brewer was asked a question about the current projected budget for the project. He said the budget is still at $89 million.

“It’s been the same budget for the last couple of months,” said Brewer. “We’re still tracking on that amount. We are sitting at just under $88 million in committed expenditures. There’s about $1 million in contingencies available for any increases that we might see.”

Brewer said the WRS had a related question on the loan authorization amendment bylaw to which city council has given first three readings. Brewer said of the $89 million that is budgeted right now, $55 million was provided by the province and the federal government. There is another $27.28 million that was under the city’s first loan authorization bylaw, he added.

“We’re looking to bump that up by $3.4 million,” said Brewer. “This would bring us to $30.7 million for the total borrowing amount.

“So far, we’ve borrowed $15 million of that borrowing we can take out. The amendment bylaw for $3.4 million has gone to three readings. We have to send it to the inspector of municipalities to approve. It will then go back to council for final approval. It hasn’t been completed yet.”

Brewer said the city will probably borrow another $5 million this fall, so that will take borrowing to $20 million of the total $30 million, assuming the city gets final approval for the additional funds.

Brewer said of the $89 million project cost, when the second large contract for all the piping work came in, it was quite a bit higher that what was originally budgeted.

“The treatment plant came in pretty much on budget,” said Brewer. “All of the linear work – the piping and all of the conveyancing running to the plant, was higher, and that’s what pushed us up to the $89 million.”

Brewer said the current projected start-up for the project is projected to be February or March of 2023.

“About a year from now is the hope for the start-up on the plant,” said Brewer. “So far, we’re still on track for that.”

Brewer said there was a question about whether the city had followed up with the province and the federal government for budget overruns. He said that when the bids came in for the linear work, they were both around $20 to $21 million as opposed to the $8 or $9 million that was anticipated.

“We did follow up with the province and the feds, whether they would bump up our $55 million grant,” said Brewer. “While we suspected it might be a longshot, we did get a letter back earlier this month saying, ‘you’ve got $55 million and there’s no more in the kitty at this point.’ We tried to pursue some other grant funding opportunities, but for a project that’s already underway, they generally don’t provide more grant funding, unfortunately.”

Brewer said the city is optimistic that the project will be brought in at the $89 million mark. He said if the city borrows for full $30.7 million, there is roughly $10 million in the sewer reserve that’s available, should the city need to tap into that fund.

“That’s nice in a sense because it’s not additional tax dollars that would have to go for borrowing,” said Brewer. “It’s available in the reserve to bridge any differences should there be increased costs.”

He said should the city borrow the full $30.7 million, that would translate into a taxation cost of roughly $201 per year on an average city home with an assessed value of $535,000.

Brewer was asked about the lawsuit launched by the original contractor for the treatment plant’s outfall after the work fell through. Brewer said he could not go into a lot of details because the matter is before the court, but he could say the city has kept the original contract value in the budget.

“The $87.9 million of the $89 million budget includes the full contract value of $2.3. million for that contract,” said Brewer