Contract for work on Paso wastewater plant is on City Council agenda

tstrickland@thetribunenews.comFebruary 4, 2013 

The Paso Robles City Council on Tuesday night will consider a $36.4 million construction contract to begin a long-needed update on its aging wastewater treatment plant. The bid comes from Fresno-based W.M. Lyles Co.

If the council selects the company, construction could begin as soon as March and be completed by September 2015. The overall project is slated to bring up to 150 jobs at the peak, wastewater manager Matt Thompson said.

The company was the lowest responsible bid of six offers the city received on Jan. 23. It has completed wastewater projects “of similar size and complexity” for Tulare and Fillmore, according to Thompson’s report to the council.

Paso Robles’ upgrade is needed to modernize the 59-year-old plant and stop chemical waste pollution in the Salinas River.

Doing so is intended to end violations of state water quality laws and stop an average monthly levy of $6,000 to $9,000 the city has paid over the past several years.

The city is currently operating on an agreed-upon time schedule with the state for the fixes.

The work includes a complete overhaul of the waste removal process, a new pumping station and the option to facilitate future production of the city’s recycled water, among other fixes.

The project will be paid from the city’s sewer account, which residential and commercial customers pay into. The payments will be buttressed by new user rates the city set up in 2011.

Other costs, including separate contracts for engineering and construction management, bring the total project cost to $47 million — about $3 million cheaper than originally anticipated due to a competitive market on services and materials, Thompson said.

Also helping to cut costs, Paso Robles secured a “historically low” 1.7 percent financing rate on a 20-year loan, Thompson said.

The new interest rate, which reduces annual costs by about $400,000, gives the project a cushion for any unforeseen expenses, he added.

New sewer rates that users began paying in July will buttress the project debt payments. The new rates replaced a previous fixed rate of $25.86 and instead began to charge users based on how much sewage they discharge. On the new rate scale, a typical household’s bill will go to about $54 per month by 2016. A typical household generates seven units of sewage per month, at 748 gallons per unit.

Connection fees for new development also went up — going from $5,467 to $10,900 per unit by January 2014.

The new rate revenue will also set aside money for future improvements to ongoing plant operations.

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