Final Information Meeting Held

Seeley Lake Sewer

SEELEY LAKE - The last of the sewer district's public information meetings on the proposed $15.7 million sewer project was held Nov. 13. It is now up to the district landowners if the project can move forward.

Joe Nickell from the public relations firm PartnersCreative ran the meeting. Presenters Dr. Walt Hill, Professional Engineer from Great West Engineering Amy Deitchler and District Manager Greg Robertson provided information on the project background and the process ahead. The presenters then provided answers to questions from the audience.

Dr. Hill recently retired as a professor at the University of Montana's Department of Biochemistry. He has been attending sewer board meetings for better than the last decade and feels that there will be a sewer in Seeley Lake sometime.

"All I know is that 10 years ago, it was a lot cheaper than it is today and 10 years from now it's going to be more expensive than it is today," said Hill.

Hill said that any time nitrates appear in the ground water, it shows contamination. The way septic systems are supposed to deal with nitrates is for the soils to filter the wastewater before it reaches ground water. At some point the soil gets saturated and then the nitrates end up in the ground water.

Nitrates are natural and they are a fertilizer but too much is a bad thing. There is a limit to what the environment can take and Hill said we have reached this limit.

Hill said the advantage of having a sewer system over the current individual septic systems is that 95 percent of the nitrates are taken out before the water goes back into the ground. This means the ground doesn't have to absorb so much.

Hill said he realizes that not everyone in the valley is going to be hooked up to the proposed sewer but we need to start somewhere.

The biggest challenge Hill sees is the cost with many residents on limited or fixed incomes. Hill believes that the Operating and Maintenance (O&M) of the sewer system could be funded through a resort tax to alleviate the financial impact.

Hill feels that we should not leave our children and grandchildren the current contaminated water.

Deitchler explained that Seeley Lake's problem is due to the high density of septic systems in town. The sewer district was laid out to take care of the highest density of houses first.

In order to take the most advantage of available grants the collection system was broken into four phases. Phase 1 of the collection system is the highest density inside the district. Grants would be sought for each of the next phases and the district could be built to its current boundaries by 2024.

Deitchler said Great West looked at a lot of possible solutions including improving current onsite septic systems, central sewers with lagoons, several types of treatment plants and even at the option of doing nothing.

Great West narrowed it down to the top three options and explored those options more in depth. After looking at the pros and cons the district chose a gravity collection system that flows to a lift station and a Sequencing Batch Reactor (SBR) for the treatment plant as being the best option. The designed system is easy to operate and maintain.

Robertson has been the District Manager for about six years. He explained the financial package and projected costs moving forward.

The current proposal is split into two parts, the treatment plant and Phase 1 of the collection system. All landowners within the district will have to pay debt service on the treatment plant. Phase 1 owners will have debt service for the collection system added on top of the debt for the treatment plant. Phase 1 will also be paying O&M costs once the system comes online.

Robertson had proposed charging businesses more than residents but changed to equal assessments after hearing public outcry over the businesses having more say during the protest period. All properties within each phase will now have equal say in the protest and will also pay the same assessment if it passes.

The United States Department of Agriculture Rural Development (RD) has provided the final part of a funding package with a mix of loans and grants for the district. All of the funding for this phase of the project has been secured. It is now up to the district landowners if they will accept the debt to repay the RD loans.

Landowners have been mailed notices of the proposed levy of special assessments for the district to borrow $5.8 million. The district has already secured the remaining $9.9 million to complete the treatment plant and Phase 1 of the collection system.

At the meeting it was presented that Phase 1 would pay debt service of $50.51 and other phases would pay $27.50. However, based on the notice mailed to landowners, each parcel in Phase one will pay $656.86 per year ($54.74 per month) and properties in Phase 2, 3 and 4 is estimated at $360.74 per year ($30.06 per month). In an email to the Pathfinder Robertson wrote that the difference was in how the bond council calculated the payments.

In addition to the debt service, Phase 1 will pay O&M cost while the other phases will continue to pay the current administrative assessment they are paying now.

O&M is estimated to start out at a subsidized rate of $437.68 per year ($36.47 per month) for Phase 1 bringing its total estimated annual bill to $1,094.54 ($91.21 per month).

Debt service and O&M for all phases will not be billed monthly but will appear annually on property tax bills.

Landowners now have the opportunity to support or protest the special assessment. To support the project landowners don't need to take any action. To protest the assessment landowners have until the close of the business day, Dec. 18 to send or deliver a written protest letter. The protest letters must clearly identify the protester and the property owned.

The way the protest works is that each protesting lot's debt is added up, Phase 1 lots at $15,706.54 each and Phase 2, 3 and 4 lots at $8,552.69 each.

If the total value of the lots exceeds half of the $5.8 million the protest is successful and the district is prohibited from levying the assessment. If the total amount doesn't exceed the 50 percent then the district is authorized to levy the assessments and the project can move forward.

The fate of the funding is expected to be known at the sewer board's Dec. 21 meeting.

Public Questions:

Business owners will have more weight than residents in the protest, please explain how much more? This is not true; businesses and residents will have the same weight to their protest in each phase. The only difference is that all lots in Phase 1 will have more weight in the protest than the other phases. This is due to them having to pay for their collection system as well as the treatment plant.

Why do you think it is fair for businesses and residents to pay the same fees when businesses can write them off? Robertson said that none of the assessment methodologies allowed by state law are fair. Given the options, this was the fairest way to do it. Ironically Robertson was criticized for his previous assessment method because it gave businesses extra weight in the protest.

How long will the financial grant support last, will it last through all the phases? Nickell said the current grants that are covering part of the construction for Phase 1 and the treatment plant are not year by year. They cover two thirds of the cost up front.

Robertson said the project is broken into multiple phases to take advantage of funding cycles. Every two years the district can apply for funds like the Treasure State Endowment Fund. He hopes that a funding package similar to Phase 1's will be available for each phase. Landowners will go through a similar notice and protest for each of the phases of the collection system.

What modifications to the force main or treatment plant will have to be made to add in Phases 2, 3 and 4? In the 2012 Preliminary Engineering Report the treatment plant was designed in two phases. The district is not building the two-phased treatment plant but building a single treatment plant that is sized for all four phases. Deitchler explained there will be minimal changes to blowers and pump sizes and some electrical improvements will be made when Phase 2 is constructed.

The biggest piece will be when Phase 3 and 4 are added. The groundwater infiltration for the discharge of treated water needs to be expanded. They were able to increase the volume of wastewater they could treat by changing the size of the blowers instead of building new basins.

When and if Phase 3 and 4 are built, what will the upgrades to the treatment plant cost? Deitchler said a rough preliminary estimate for just the upgrades to the treatment plant is $1,000,000.

Is the current O&M only for Phase 1? In the 2012 Preliminary Engineering Report, adding the rest of the district resulted in a 60 percent increase. Would this still apply or has something changed in the calculations? Robertson said the O&M is just an estimate. Without a history of running the system, there is no way to know what the costs will be.

In Robertson's scenario, subsidies are used to reduce the O&M cost for Phase 1 until more properties in the other phases can be added in. His projections account for inflation and show O&M cost ramping up from $36.47 per month to $48.56 per month as the subsidies run out and Phase 2 and 3 are built.

Deitchler said there are some costs that would go up as the other phases are added. There are a couple more lift stations that would use electricity.

Great West recommended that the collection system be cleaned every five to 10 years. The more collection system the more cleaning will need to be done every year. If individual grinder pumps are to be maintained by the district there will be more of those added in each phase that require maintenance.

Robertson did not account for some of those things because in his experience they don't spend as much as estimated. For instance, they don't spend a lot of money cleaning pipes every five years because they inspect them and only clean when needed. That's a more practical way of doing it. That will result in a reduction in the O&M estimate balancing out with some of the increases.

How can I see a full engineering design and budget that shows all the costs, section by section for the treatment plant and all the phases of the collection system? Deitchler said Great West has not completed a full design and estimate. While Phase 1 has been fully designed, the other phases of the collection system only have very preliminary design done. The county and sewer district determined that a full design of the system was not in the best interest of the community until the first section was built.

Will the treatment plant be able to accept loads from septic pumper trucks and RV dump stations? Deitchler said the sewer board would need to decide if they will accept that kind of waste. RV dumps and trucked in waste provides what is called a "slug" in the treatment plant. Slugs can cause an upset condition at the plant and drive up operating costs.

Deitchler said in Phase 1 there is no place to dump pumper trucks and no RV dumps are being hooked up so that conversation hasn't been had.

Robertson, who is also the Lolo Sewer District Manager, said the Lolo system is too small to dilute the slugs enough to prevent upsetting the system. "We stopped accepting that kind of waste a long time ago," said Robertson.

Missoula City Sewer accepts those kind of wastes.

It is visually apparent we have steadily increasing algae in Salmon and Seeley Lakes. Will the sewer system help protect our lakes? Hill said it is unquestionable that the sewer will help. The more nutrients such as nitrates in the lakes, the more algae will grow. The sewer system is not going to deal with all the sources of nitrates but will reduce the overall amount.

How many non-permitted septic systems are currently inside the sewer district? Robertson didn't know the actual number but that there is a substantial amount of them. He suggested the health department might be able to answer the question.

If this sewer system does not proceed, what is the potential for the state or federal government to step in and mandate that Seeley Lake implement a system? Robertson said the threat exists but he didn't know when it would happen in Seeley Lake. The EPA has forced some sewer system upgrades in Missoula County over the years for violations of the Clean Water Act.

If this system were to be built without grant funding it would cost two to three times as much for debt service as currently estimated.

What is the average lifespan of a septic system? Robertson's experience with his county maintenance facility west of the airport in Missoula is that they are on drain field number three since it was built in 1997. A number of things that can cause premature failure include driving over the drain field, not properly maintaining the system and the type of waste being produced. Soil types also make a big difference.

What is the cost to replace an individual septic system in the district and can they be replaced? Robertson said the health department has made a special management area covering a significant amount of the sewer district. If a system fails the health department will allow it to be replaced. However, if the use changes such as adding to the structure or for new construction they may require a more expensive level two septic system.

Robertson said a general rule of thumb is that a level two septic systems cost approximately double what a standard system costs. Robertson said a conventional system is $7,000-$10,000.

Why have you decided to bypass the democratic system and not allow us vote on this system? Robertson explained that the vote was not required by law. Rural Development requested a vote to show "public support."

After the vote failed, the board appealed the decision to require a vote. The district argued that the people who were allowed to vote didn't represent the landowners who ultimately will have to pay for it on their property tax bills.

Rural Development accepted the sewer district's argument that the vote was not required and allowed them to continue to pursue the funding through the upcoming notice and protest.

How can the bill for the sewer be on my property taxes? Robertson said property tax bills include both assessments and taxes. Special districts are assessments and can be included in the tax bill. This is the best way to guarantee that the lending agency will be repaid.

The life of the treatment plant is said to be 20 years but the bond debt lasts 40 years. What will it cost to repair in 20 years? Deitchler said most systems last much longer than 20 years. Concrete structures are built to last 40 or more years so most of the things needing replaced will be equipment.

There is a short-lived asset fund built into the O&M cost. This fund is required by RD and sets aside $26,700 each year to create pot of money to make these replacements as needed.

Why are the houses closest to the lake and river not included in Phase 1? Deitchler said they tried to get the highest number of properties in Phase 1. Houses on the lakes and river are spread out over a greater distance than the ones in Phase 1.

How many jobs could a sewer department make? During construction it is estimated to make approximately 121 full time equivalent jobs that are temporary. After completed, one full time employee will be needed to run the treatment plant along with a part time, back-up operator.

In the original O&M estimate it showed a vehicle being provided by Missoula County and in the new estimate there is a cost for fuel but no vehicle. Is the county still providing a vehicle? Robertson said yes.

If a property requires an onsite grinder pump to hook to the sewer, who pays for and maintains the pump? Who pays for the electricity? Robertson said it would be a policy decision for the sewer board. He didn't think it had been discussed yet.

Robertson said it varies across the state with some districts requiring landowners to maintain and others the district maintains. The electricity to run the pump is a minor cost compared to the cost of maintaining and replacing the pump. He said he would recommend the district accept responsibility to make sure the system works smoothly.

What happens to the properties with grinder pumps if the power is out for a couple days? The grinder pump systems have a tank with them that can store several days' worth of sewage. During a natural disaster where the power will be out for an extended period other measures will need to be taken.

If a commercial location requires something like a grease trap or recirculation filter that has been suggested the car wash needs, is that included in the free hookup or will that cost fall on the business? Robertson said that would be a policy question for the board. They haven't gotten down to that level of the discussion on individual property's needs for pretreatment.

Does the $91 dollars per month for Phase 1 include use or is there a cost for use above that? Nickell said usage is included in the cost estimate. The debt service portion is a maximum amount that can be charged for debt service. If the construction bid goes over the estimate, the district would have to have another notice and protest of the landowners to approve it. The O&M portion will probably rise over time with the cost of inflation.

Nickell also noted that even though they are talking in terms of monthly payments, these assessments would be on landowner's property tax bill. Property taxes are due twice a year.

How long is the O&M estimate good for or can it be changed next year? "The district board of directors can do really anything they want in terms of the amount of O&M costs," said Robertson.

Things change and there can be ups and downs in the O&M cost. Robertson said he hopes the district can build up a little bit of a reserve to take care of any unanticipated issues and keep the rate fairly constant.

The O&M estimate states that it does not include current district administration expenses but Robertson has proposed using the current administrative fee for subsidies. Where will the money come from for the current district costs? Is that going to affect the amount available for subsidies? Robertson said he was conservative when he projected the O&M costs and subsidies because he didn't account for all the revenues that are coming in. The O&M estimates are what Robertson presented to the board to show just one scenario of how it could work.

Local businesses find it difficult to find workers, would-be employees often state that they can't find housing. What impact would the sewer have on housing? Nickell said the increased cost of building individual septic systems due to the county's special management area and the inability to build on some lots has limited the number of houses. That drives up cost. There are costs associated with the sewer system but they offset the cost of the individual septic systems that would be normally figured into the cost of a mortgage.

If the sewer goes in, the special management area would go away and allow for new construction in areas that are essentially undevelopable now.

Why doesn't the proposed sewer system follow guidelines and recommendations from rural wastewater management? Robertson said he feels that they are. The system has to be designed and maintained by standards adopted by DEQ and the EPA. The designed system meets and exceeds those standards.

Customarily people receive charges when they receive benefit, what direct benefit do landowners in Phase 2, 3 and 4 receive that enable the board to charge them for debt service? Robertson said the districts must simply show there to be a "reasonable benefit" in order to levy assessments. The district's bond council has determined that the assessment methodology and assignment of benefit is legally defensible.

In this case what those properties in Phase 2, 3 and 4 are buying is their portion of the capacity of the treatment plant.

Robertson said there is typically a latecomer's fee for properties that may want to join the district. That fee helps reduce the debt on the rest of the properties that have already been paying their share.

The system is designed to cross private property at the top of Cedar Lane as the force main heads to the treatment plant. What if those landowners say 'no?' Do they have the right to do so? Robertson said every property owner has a right to say no though he hopes that wouldn't be the case. He believes some of the board members have already had some discussions with the landowners and they've been supportive of it. Robertson hasn't had any direct conversations with them.

If the answer is 'no,' there are other options like moving the force main to the north onto National Forest Service land. The board could use also use eminent domain if necessary however in his 18 years at in Missoula Robertson has never had to resort to taking property through eminent domain. They usually can negotiate a solution that is fair to everybody.

"We haven't gotten that far in the discussions. First we need to have a decision on whether [the sewer] is going to move forward or not and then we'll engage property owners for any of the right of ways," said Robertson.

Shouldn't you have those rights of way before you estimate all this? "I think that's a valid question and that's why we reached out to the property owners to find out their level of interest or issues. The property owners at the top of the hill indicated to the board members that they were supportive of the project and would be willing to grant the necessary right of way," said Robertson.

Most of the project is in public right of way and the district has acquired some of the others needed.

Can the treated water be used for anything else like watering the lawn at the airport or irrigating a crop? Hill said he didn't know about irrigation but that the treated water would be safe to drink.

Deitchler said that DEQ has reuse standards that can be met. Great West is currently working on a project in Fort Benton, Mont. to use water from a treatment plant for watering a golf course.

Does taking the greenhouse off the treatment plant change the need to have an FAA study on having a bird attractant near the airport? All the basins are covered so there is no open water. When the district was looking at a lagoon system the FAA came out against it due to the bird issue. That is one of the advantages of the sequencing batch reactor the district chose.

In the Letter of Conditions from RD, it states that any extra funds will be deducted from the grant funds first, not the loans. If the loan amount won't be reduced, does that mean that the maximum assessments will be charged? Robertson said that would be best answered by RD.

In an email to the Pathfinder, RD's Community Program Director Steve Troendle wrote, "While a reduction in project cost would be nice, we think it unlikely. The regulations do not fully address this situation on projects that have had an increase in cost."

Troendle wrote that until the bids are in it is a moot point to talk about if the extra money would come off the grant or loans. One place that might make a reduction in debt service is if the interest rates are lower at closing.

 

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