By AMANDA KIMBLE
STEPHENVILLE (February 27, 2017) – Recent discussions weren’t the first and won’t be the last between members of Stephenville City Council, city staff and industry professionals on the Eastside Sewer Project.
The council voted last week to approve three contracts related to the project, but officials are not expected make votes related to the scope, cost or initiation of the project for some time.
The proposed sewer renovation and expansion project includes three phases and a total estimated cost of $16.5 million.
Recent related council discussions revealed three things – the first phase is a must; the second phase would enhance a previously funded project; and some council members believe the third phase is being proposed on hopes future industrial development.
The contracts approved last Thursday will give the city more leverage in seeking loan forgiveness and low interest financing, according to Public Works Director Nick Williams.
“The intent of securing agreements is to better position the city to receive the highest scoring possible when the city’s application is reviewed and ranked by the Texas Water Development Board (TWDB),” Williams said. “Submission rankings determine the probability for principal forgiveness.”
Stephenville applied during the last funding cycle and was eligible for 30-percent forgiveness, which equated to an estimated $5 million savings. Last year, the city ranking 44th of the 103 project submitted, and funding was exhausted by those whose project scores positioned them higher on the priority list.
Williams told the council that TWDB officials said projects that are ready to proceed with construction are automatically moved to the first-round invitation list, which could put Stephenville ahead of other projects that had otherwise been scored with greater number of points.
Meanwhile, City Administrator Alan Barnes told the council there will be at least seven opportunities for them to back out of the sewer project or scale down the scope to a single of the three phases.
“We are asking if we can go to the starting line,” Barnes said.
The TWDB timeline includes a March deadline for the submission of a project information form (PIF). TWBD is expect to score and rank PIFs through June.
Williams said an intended use plan (IUP) will be presented to the TWDB in June, and a 30-day comment period will also commence at that time.
Williams said TWDB is expected to send initial invitations to top-ranked projects in August, and initial applications are due in September with funding determinations and award letters mailed in October and November.
Meanwhile, Williams reminded the council that the city entered into an agreement with the Texas Commission on Environmental Quality (TCEQ) in 2008 due to the number of sanitary sewer overflows.
“We have to do phase one,” Williams said.
That portion of the project runs from the wastewater treatment plant up to a relief load transfer point and bottlenecks, with two 15-inch lines feeding into a single 21-inch pipe at the Collins Street bridge before the sewer line continues to Crow Street.
Since the infrastructure is existing, that widespread renovations won’t require easement acquisition, but it’s the largest portion of the three phase project, with an estimated cost of $9.5 million.
Williams said failure to address the issue could lead to costly fines from TCEQ.
Mayor Kenny Weldon said those fines could add up to tens of thousands of dollars per day.
It also impacts a large portion of the city, including everything North of Lingleville Road and north of the Northwest Loop from Pecan Hill to the east and west to the new fire station. Williams said the heavily populated area also includes the Tanglewood subdivision and Golf Country Estates.
Council member Carla Trussell was among officials who said they would approve the first phase of the project tomorrow due to need.
“I consider the rest a want and would like to see those (Phase II and III and the estimated cost of $8 million) taken to the voters,” Trussell said.
Phase II runs from the wastewater treatment plant to Clark Field Municipal Airport. Phase III spans from a relief load transfer point to FM 8 (Lingleville Road) and U.S Highway 281, where passersby can see a sign that advertises industrial property with highway and raid access.
Weldon said it might be too early in the discussion to separate needs from wants. He reminded the council that airport improvements, included a 5,000-foot runway extension, were previously approved in an area where a sewer main does not exist. He said millions of dollars are being invested, but there’s no way to develop the economy in the area.
“Not doing Phase II is like buying a used car with bald tires, having something you fixed up but cannot use,” Weldon said, adding the airport improvements would open up an attractive area for industrial development.
He also said the 281 corridor could welcome more development in area that already includes the sizeable Creekside Townhomes.
“We need to be asking if there’s opportunity for more development and if that system is already at a maximum,” Weldon said.
He also told the council to consider the fact that the city could have another shot at $5 million in principal forgiveness when looking at the project in its entirety.
Council member Brady Pendleton agreed, saying he could not make decision at the time. He said his future voters will depend on the application process and funding support received for the project.
“It would be foolish not to do more with loan forgiveness,” Pendleton said.
Meanwhile, council member Rhett Harrison agreed with Trussell and council member Sherry Zachery, saying renovation of the existing system is a must.
Harrison also said when the council considers approving the expansion of the city sewer system by 1,900 acres, officials should consider other issues with existing infrastructure and how to explain to citizens affected by those problems why needed repairs don’t take priority over hopes for the future.
Trussell ultimately decided she could agree with airport, but wasn’t ready to support Phase III for an industrial park that doesn’t exist.
Council member Doug Svien said determining the scope of the project provided another example of the city’s need for a capital improvement plan that addresses all infrastructure needs.
“We may have $20 million of infrastructure needs in area outside of the sewer system that should supersede Phases II and III,” Svien said.
Knowing there was still plenty of time to consider their options, the council approved the project management, financial advisory services and bond counsel contracts.
An item in the contract with Project Management, Inc. was removed after council member Jerry Warren expressed concern that the $81,000 related to easement acquisition – $2,250 per parcel plus associated fees – was simply too high.
Williams said the entire project would include 26 parcels, and Warren said a local real estate professional could provide the same services for a tenth of the cost.
The council supported the motion to seek local bids for acquisition services and will revisit that issue in the future.
Project Management, Inc., was however awarded services related to reporting and compliance and environmental assessment, which is required to receive sought-after funding through the Texas Water Development Board (TWDB). Those items include an estimated cost of $165,000.
Meanwhile, the council approved a contract with FirstSouthwest, Inc. for financial advisor services with an estimated cost of no more than $67,000. The firm would assist with the issuance of securities for the project, which has a total estimated cost of $16.5 million if the council votes to complete all three phases of the project.
A representative of the firm told the council the fee was based on the amount of the security issuance.
The council also voted to approve contracts with McCall, Pankhurst and Horton, LLP for bond counsel services with an estimated maximum cost of $55,500.
Bond counsel costs will only be incurred if the council approves repairs and the total cost would also be contingent on the scope of the project.
The project has been on the drawing board for about 10 years, according to Williams.
With a multi-million dollar problem on their hands, officials said they would like to get public input when determining the scope of the sewer renovation and expansion project.
But, they seemed to agree with the idea that public opinion is hard to come by when citizens don’t attend regular meetings of town hall gatherings that give them the opportunity to speak on issues that could impact their tax rates or service fees paid the city.
More information on the project is available on the city website.