Supervisors pick up the pace on Osos sewer

County supervisors agreed Tuesday to an accelerated process for planning and building the Los Osos sewer.

However, exactly how that work will be paid for is still up in the air, pending a decision by the U.S. Department of Agriculture on whether $80 million in stimulus money will be allocated to the project.

County Public Works staff had expected to hear a decision by Tuesday on dispensation of the last round of federal stimulus funds. The money would be in the form of $16 million in grants and the rest in low-interest loans.

Word on the stimulus money is now expected within the next couple of days to a week, said project engineer John Waddell.

Under the accelerated work process, construction on the project will begin in September 2011 rather than March 2012. Speeding up the process takes advantage of a competitive bidding process that has seen bids coming in as much as 30 percent below estimates, said Supervisor Bruce Gibson, whose district includes Los Osos.

“This was a very important decision we made today,” he said.

The supervisors will have to decide whether to finance the accelerated work schedule by lending the project an additional $400,000 or speeding up a legally required process called due diligence.

The county has already spent nearly $8 million funding the sewer process. That money should be repaid when funding in the form of property assessments and loans is finalized.

By speeding up the due diligence process, the county could tap into about $300,000 in assessments that have been paid in advance; however, this strategy is risky without a formal decision on federal stimulus funds as well as uncertainty about future litigation, County Counsel Warren Jensen said.

The $166 million project is expected to take two to three years to build. Homeowners are expected to pay $200 a month to finance the project. That amount could reduce somewhat if federal stimulus money and favorable interest rates on loans are secured, Gibson said.