(Gillette, Wyo.) Proposed upgrades and repairs to the Waste Water Treatment Facility will cost the city more than $20 million over the course of the next five years.
Solutions to offset the cost of the project were presented the city council during their regularly scheduled work session.
City Administrator Patrick Davidson confirmed to the council that upgrading the facility is a necessity, evident of what he saw during a recent visit to the plant.
The environment inside the facility is extremely corrosive to the electronics, many of which are over 40-years-old, said City Spokesperson Geno Palazzari.
The worn and old equipment needs to be replaced if the plant is to continue its operations.
“It’s difficult enough finding parts from the [1980’s], let alone the [1970’s],” Davidson said.
Furthermore, the equipment must be upgraded to remain in compliance with regulations laid down by the Department of Environmental Equality, or DEQ.
“The plant was made was made under regulations from the [1970’s],” said Palazzari. “Regulations have changed.”
In total, the proposed changes to the Waste Water Treatment Facility will end up costing the city a total of $22.8 million, to be spent in segments spread across the next five years.
Such an expenditure needs to be appropriately offset if the city is going to prevent its Waste Water Enterprise Fund from disappearing entirely from the reserves.
The City of Gillette is a member of the Nebraska Municipal Power Pool. As a member, the city was able to enlist the assistance of NMPP’s non-profit technical services to evaluate the rates for the city’s enterprise funds.
Mike Cole, city utilities director, said that enterprise funds are evaluated every year, with the NMPP conducting cost of service studies on one fund per year on a four to five year rotation.
Cole said this year, the attention of NMPP was focused on the city’s sewer fund.
Andrew Ross, utilities director for the Nebraska Municipal Power Pool, recommended the city have a target cash reserve balance of nearly $3.5 million.
Ross and Cole presented the council with three ways the city could proceed to meet recommendations—should the optional 1 percent funding remain intact during the coming years.
For the first option, Cole and Ross proposed a moderate revenue increase that would stem from increasing the city’s waste water utility rates by 5.8 percent each year for the next five years.
A 5.8 percent increase translates to residents paying an additional $1.36 per month each year. If a resident’s waste water bill is $23.41 right now, the bill would max out at $31.03 in fiscal year 2023.
The next option was for the city to take no action—essentially doing nothing to offset the $22.8 million dollar expenditure. In this option, the city’s waste water enterprise fund would be virtually non-existent in five years.
Doing nothing is not an option if the city is to maintain the quality of life for its residents, Ross said.
Palazzari said that the current city code under chapter 17 prevents the council from doing nothing.
Option three outlined a scenario where the optional 1 percent was not available to fund capital improvement projects. In this case, the city would have to essentially double its waste water utility rates to preserve the waste water enterprise fund.
The official staff recommendation for the council from Cole was to increase the waste water utility by 5.5 percent.
Optional 1 percent funding is vital to the city’s future plans, which at the moment can only be made based on estimates of the city’s funding needs, Palazzari said.
Final recommendations for the utility rate increase will be forwarded to the council in early March and will have to go through three readings and publication in the newspaper of record before it can take effect.
As it stands right now, no utility rate increases have been approved by the council. Should the council approve the proposed increase, it will take effect on May 1.