When he interviewed for the job, Flagler Beach City Manager William Whitson referred to the city’s sewer plant as “the bones of the community.” He’d also seen how decrepit the plant had become. “There are things that are occurring in the bones of the community that you just can’t see and that because you don’t work with it every day you don’t appreciate how bad it is,” he told city commissioners. “It’s old and it’s wearing out, and it’s now your responsibility as stewards to step up and make some decisions.”
Earlier this month, the city commission voted 5-0 to borrow up to $15 million to build a new sewer plant in what will amount to one of Flagler Beach’s largest–if not the largest–infrastructure investments in the city’s history, at least in unadjusted dollars. That’s up from $11 million from 2019 blueprints. The state is providing an $850,000 grant to offset the costs. The rest will be paid for through utility fees, not property taxes, though for residents the distinction is moot even as it provides cover for politicians.
Whitson’s wasn’t the only metaphor of the evening. Ben Fries, the city’s consultant on the sewer plant and for 35 years an engineer with CPH Engineering, improbably compared the city’s sewer plant to the heart, “and you’ve got all these veins, the veins or the sewers running through the city, and it’s bringing all this wastewater to the treatment plant, and that’s where we really need to start.” In a presentation stretching well past the hour mark, he gave commissioners a lesson on the city’s sewer system–its 25 lift stations, its various mains and manholes, its collection system, disinfection systems, and so on. It got more detailed than most people need, or want, to know, sludge bed and “digest blowers” buffs aside.
More salient points included such things as repairing versus building new tanks at the plant: It would take $1.25 million to repair the concrete on an existing tank, “which is more expensive than building a new tank,” he said. (Concrete’s salt life is about 40 years, he said.) Security demands are far higher than what they were 40 years ago. That will add costs. As has the surge in construction costs of late: concrete costs up 60 percent, according to Fries, rebar up 67 percent, copper up 48 percent, though some of those costs are beginning to level off, if not decline slightly.
One certainty: The city’s sewer plant has to stop dumping its effluents in the Intracoastal by January 1, 2032. That’s a longer time span than the city had been anticipating for the past several years. It’s been pushed back, giving the city more breathing room to get its new sewer plant up and running. It also gives the city time to figure out where it will put all that excess water, once the city can no longer dump into the Intracoastal–and as long as the city has no plan for recycled water.
“Today, we’re replacing infrastructure with this project,” Fries told commissioners, his enthusiasm and demeanor echoing that of a Silicon Valley executive unveiling a new smart phone. “That’s it. Stuff that’s antiquated and everything, it’ll be high efficiency. We’re going to use actually less power than you use today, we’re going to save you chemical and operating costs.” Savings on electrical costs are expected as well. The budget for chemicals currently is $100,000. “I’d love to see that cut in half,” the city manager said.
The plant will not shut down during construction, which will be done in phases. (“I really don’t have any questions except how do you keep this enthusiasm up about wastewater treatment plants?” Commissioner Jane Mealy asked Fries at one point–the question on more than a few lips. “And what I haven’t told you is,” he replied, “I’ve been a professor at the University of Central Florida teaching this stuff for 35 years.” He’s also designed some 25 sewer plants.)
When Fries began talking about the cost of the project, he said the 2019 plan for the sewer plant had “left out” a lot of necessary infrastructure, and was going to cost $11.4 million plus $3.8 million in interest, for a total of $15.2 million.
He then revved up his salesman approach: “I am giving you more infrastructure, you’re going to pay less money,” he said. “Right now, it’s hard to say, we’re waffling because of the commodities change every single day. We’re somewhere close to $15 million. But here’s the beauty of this: the SRF loan interest rate is 0.2 percent. It’s like free money.” (SRF is the acronym for the State Revolving Fund loan the city would take out.)
Wait. There is more.
Fries told the commission that under its previous plan, it would have had to pay $870,000 a year on its sewer-plant mortgage. Under the current plan, it would have to pay $765,000, with interest payments over 20 years totaling just $370,000 as opposed to $4.1 million. He then went on describing other means of lowering the city’s costs.
But as with all fine-printed financial presentations, it may not be that simple. The city is likely, but not guaranteed, to be approved for a loan. And the interest rate will be defined only at that point. That’ll be later this summer.
The resolution the city commission approved after the presentation merely authorizes the city manager to apply for the State Revolving Fund loan, without specifying an amount. Whitson will negotiate terms and carry out all financial and administrative activities requirements. The loan application was due last week. The state holds hearings on those applications in the second week of August. It will then select who’s eligible.
“So let’s assume you’re going to get selected, which I don’t see any reason why you wouldn’t,” Fries said. “The day that they approve you, you now have the capability to execute the loan, it will take another 60 to 90 days for the paperwork to go back and forth from Tallahassee to you all. They will define at that point the interest rate. That’s the scary part about this. You can take a look. Now’s the time to get this loan, because I would bet my heart of hearts, January 2022, they’re going up. And it could be significant because we’re starting to see some inflation, you know how that is.”
According to that schedule, construction would not start until January 2022, and completion would take 18 months. Being a revolving loan, the city will not borrow the $15 million up front, but will borrow what it needs when it needs it as the project progresses. If the city only needs $12 million, that’s the amount it’ll pay interest on and pay back. “If we don’t spend it, we’re not going to borrow that money,” the city manager said.
“I feel very confident in our team, and I feel very confident in our ability to get it funded, and to triage it in the right way,” Whitson said. “So we’re going to go from the zero infrastructure to the proper infrastructure but we’re going to do it in an orderly manner, and we’re going to do it based on cost effectiveness.” But the construction ahead will not address recycled water. (One option: pumping that excess water underground. But that would cost about $8 million, Fries said.) So the city will get out of Intracoastal dumping, but the “when” of that question has not been answered.
“It’s definitely time to get rid of the treatment plant,” Commissioner Rick Belhumeur said. “It’s on its last leg. Very fragile. The sooner the better.” He later added: “This project will essentially replace nearly everything that’s there now with updated technologies and equipment, piece by piece,” bringing the plant fully within 21st century standards.
Perry Taylor says
Why aren’t the builders and developers picking up some of this cost?