Chances Slim For Wastewater Treatment Plant 30% Grant

The City of Peshtigo’s Water and Sewer Committee received the unwelcome news Monday, Dec. 10 that their hopes of getting a 30 percent “forgiveness” grant from the DNR to help finance its $2,447,582 wastewater treatment plant reconstruction project almost certainly will not be realized. The DNR’s final list ranking projects to be awarded the loan forgiveness for 2013 has been released, and Peshtigo’s ranking of 77.355 is not very high on the list.

“Unless somebody completely drops out, it’s pretty unlikely the funding will drop down to Peshtigo,” Chris Kaempfer of project consultants Kaempfer & Associates told the committee. He said the DNR has very little money available for the “forgiveness” program, but plenty for low interest loans, at perhaps two to three percent, to finance such projects, so that is not a problem. The eligible amount for the Peshtigo project, according to the list distributed to committee members, is $1,731,803.

While the chances of getting the 30 percent “forgiveness” grant for the eligible portion of project costs are slim, Kaempfer said, “We have nothing to lose by waiting and seeing.” Final results should be known soon.

To a question from Committee Chair Fred Meintz, Kaempfer said the application can be carried over until next year, but they would be starting over against an entirely new field of applicants.

A $60,000 Focus on Energy grant was previously announced, and the DNR now has granted an additional $25,000. Both will be formally acted on in January after a consultant verifies some discrepancies on dates and the mayor at that time should be authorized to sign them, Secretary Mary Ann Wills noted.

Discussion continued from previous meetings on how to allocate wastewater treatment plant use charges as they relate to costs of upgrading the treatment plant and lagoon system and normal operating costs, as well as cost sharing between the city and BPM, Inc. in accord with the operators agreement for engineering fees for the water system upgrade at the Wastewater Treatment Plant.

On the wastewater treatment plant charges, Kaempfer said they could base charges either on flow or on meter size. For other businesses in the city charges are based on water meter size.

BPM, Inc. manager Jim Koronkiewicz said if the charges are to be based on flow, it would have to be on effluent, not intake. He said the vast majority of water that comes into the mill is used for making paper, cooling machines, etc., and much of it comes from wells owned by the mill, rather than from the city’s water utility. There is no way of knowing how much

Kaempfer said the mill does have meters on drinkable water coming into the mill, “but we think it would be more fair to base the charges on meter size,” as many other communities do. If the mill was charged for a 6” meter they would be paying four to five percent of the total collection costs, compared with a much higher percentage if charges were based on actual flow.

“You don’t use any lift stations,” Kaempfer told Koronkiewicz. “It would be different if you were on the other side of the city and did need the lift stations.”

“I do think charges based on the meter equivalent would be more fair in this situation,” Kaempfer repeated, adding he was not sure about the BPM, Inc. position on that proposal, “but it’s something we can talk about.”

He presented some other information as well, and commented he brought these things up at this meeting so Koronkiewicz and the committee can be thinking about the various proposed solution to the cost allocation dilemma.

He suggested slating a discussion for a special workshop meeting which was eventually set for 9 a.m. Thursday, Jan. 10. Formal action would then be expected at the next regular committee meeting at 9 a.m. Monday, Jan. 21.

Kaempfer said they will be looking at cost distribution for the collection system, lift station costs, treatment plant costs, and capital costs, including depreciation and the equipment replacement fund.

“You may not want to include it,” Kaempfer said of depreciation, “but you may have to, so you aren’t constantly looking for money as you do now.”

Public Works Director George Cowell asked if depreciation costs would be included in the operating agreement, and Kaempfer said only actual operating costs and routine maintenance should make up that agreement.

He said if they do stay with DNR funding they would have to bill BPM, Inc. for the cost of treatment, but they in turn could bill the city for operating the plant, and it could come out a wash. “It might be better just to refine that agreement,” Kaempfer suggested, adding it does need some refining, “but we’re not trying to turn the whole agreement upside down.”

Cowell asked Kaempfer to get whatever information he gathers to Koronkiewicz and committee members prior to the Jan. 10 negotiating meeting, so they can think about it in advance.

Kaempfer said he already has prepared a list of things that need to be done, in chronological order. He will define what the issues are and expects to have an initial rate recommendation ready for the January meeting.

Meintz commented it is fine to study the issues now and then meet on it in January, “but I would like to see this thing moved forward....It has been going on for many, many months.”

Koronkiewicz said earlier that day he had received a list of all the equipment BPM, Inc. purchased for the wastewater treatment plant renovations, “and that would become part of this discussion.”

Koronkiewicz said he had received nothing on a water system upgrade he just learned is required by the DNR.

Meintz said there should have been DNR approval and a permit for the original well back in 1970, as part of the Donoghue project. The application was never submitted, and the DNR was not too happy with that, Meintz said. Now they need to do a flow study and look at the rate of flow. Kaempfer feels it is necessary to run a comprehensive “flow” test to see how far the water can be drawn down and measure the refill rate, since that well cools the engine generator and shutting it down would shut everything down.

Meintz predicted it will come out to be a very high capacity well, which will require installation of a meter to measure output and payment of a $500 DNR registration fee.

Mayor Allen Krizenesky recalled that the city held the permits back in the 1970s. At that time, with the pulp mill, Badger Paper Mills used 90 percent of the wastewater treatment plant capacity and paid 90 percent of the costs.

Meintz asked Cowell to look at recommendations from several well drillers and if necessary he can get the studies done with a purchase order, provided cost does not come over the bid threshold.

As to the wastewater treatment plant construction report, Kaempfer distributed pictures of some very corroded metal connections on HDPE plastic water lines. Tests showed they would not hold under pressure and in fact they were leaking in several places for a long time, possibly from the day they were installed. The soil around these pipes was like a septic tank, he declared.

He said they are hoping the pipes were not done this way in too many places. He said finding more of the faulty leaking connections “would be undesirable, but not unexpected.”

Kaempfer said electric service on two of the feeders failed on a line that serves the RAS and central control buildings. Repairs done in the past did not meet electric code requirements and costs to redo the wiring and run the big generator to keep the plant going while repairs are made would cost almost $100,000. The upgrade could add $100,000 to the project costs.

Cowell asked if frost will affect the the ability to install the underground wiring work, and Kaempfer suggested they should give the contractor until June to finish the work. Meintz did not feel the work could be done in winter without a lot of extra cost, and agreed a time extension is appropriate. “You’re likely to get a better product if you do it when the weather is right,” Cowell concurred.

A change order increasing the contract with Oudenhoven Construction Inc. by $29,231 was formally approved. The same change order, but for $28,210, was approved in November but then was revised.

Payments of $193,636 and $69,450 to Elmstar Electric Corporation for work on the Wastewater Treatment Plant Aeration System Improvement project were approved.

There was brief discussion on a letter from Wisconsin Public Service Commission regarding a motion to revise the uniform system of accounts on municipal water utilities. Wills said this is proposed to be a statewide rule. She had contacted Peshtigo’s auditors. “They were aware of the change, and will be working with us,” Wills said.

Cowell reported the fluoride dispenser on one of the city’s wells had malfunctioned. The warranty had expired about a month previous, but the supplier covered the repairs anyway, he said.

There was some discolored water on Noquebay Ave. last month caused by a water main break, Cowell said, but there was not as much discolored water as there had been occasionally in the past and it was corrected promptly.

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