Why Did Cape Charles Build a New Sewer Plant?

New Town sewage treatment plant cost about $19 million, with $14 million paid by government grants. (Wave photo)

New Town sewage treatment plant cost about $19 million, with $14 million paid by government grants. (Wave photo)

Cape Charles Wave

May 24, 2013

Pop quiz: Cape Charles built a new $19 million sewage treatment plant because:

A. The old plant was too small;
B. The old plant was polluting the Bay;
C. Government sewer grants were too good an offer to refuse;
D. Both A and B;
E. Both B and C;
F. None of the above.

(Answer appears at end of story)

In an effort to bring clarity to an otherwise murky subject, the Wave met recently with Town Manager Heather Arcos and Assistant Town Manager Bob Panek. The latter was the driving force behind the new sewer plant.

Panek informed Town Council last week that the new wastewater treatment plant is substantially complete, with the exception of plans to reuse a portion of the effluent currently flowing into the Bay.

The plant has been treating wastewater since April 2012, and has reduced nitrogen and phosphorous discharge into the Bay by 93 percent compared to the old plant, according to Panek.

Arcos and Panek claim that when all expenses have been paid, the project will have cost about $300,000 less than the budgeted $19.2 million.

But whether the Town came in under budget or over budget depends on the starting point.

The $19.2 million includes cost overruns and change orders amounting to $558,000. So even with the $300,000 savings, the final cost is $258,000 higher than originally budgeted.

But there can be no argument that the Town got a good deal on the project: The Water Quality Improvement Fund provided $8 million, and the Virginia Clean Water Revolving Loan Fund (funded by the Federal stimulus program) contributed another $6 million, free and clear.

The Town borrowed the remaining budgeted $5.2 million from the same Virginia Clean Water Revolving Loan Fund, but at not quite as good terms: this money has to be repaid, albeit at 0 percent interest. [Read more…]

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