On Sept. 3, the board of the Pagosa Springs Sanitation General Improvement District (PSSGID) voted to move $500,000 from town funds to kick-start critical repairs on its sewer system, pushing off a bigger decision on financing for a larger overhaul of the system.
Public Works Director Karl Johnson said that he fears a “catastrophic event” could be in the cards if the district doesn’t do something now to shore up the system.
Town Manager David Harris added, “We need to get moving here … and we need to move sooner rather than later.”
Johnson explained to the board that the biggest project on the district’s radar would be to continue repairing what has been deemed category 4 and 5 problems with sewer pipes, as well as its obligation to upgrade the Vista Treatment Plant, owned and operated by the Pagosa Area Water and Sanitation District (PAWSD), to bring it into compliance with state Regulation 85.
PAWSD has estimated that bringing the Vista plant into compliance with the state environmental regulation, pertaining to acceptable phosphorus and nitrogen outputs, would be a multi-million-dollar upgrade project.
The town-run PSSGID would be responsible for 25 percent of these upgrade costs, per its current agreement with PAWSD, putting the town on the hook for expensive repairs if both entities continue with the current system, which annually pumps 460 million gallons of town wastewater several miles uphill, using a series of lift stations, to the PAWSD-owned Vista plant.
This has led both entities to consider the idea of building a new, jointly run wastewater treatment plant closer to downtown.
A recent memorandum of understanding (MOU) between the PSSGID and PAWSD states, “There remains uncertainty as to the long-term viability of the [town’s] main pipeline and two pump stations.”
Aging infrastructure and a history of failing lift station pumps has required the PSSGID to spend over a million dollars to keep the current system running adequately, the MOU states.
The MOU also states that, “as part of the Roaring Fork Study, it is noted that if consolidation is pursued between” the two entities, “the community may be better served by a new wastewater treatment facility,” with Yamaguchi Park South being the ideal location.
But Johnson said at the meeting that the most immediate thing that needs attention is “the rehabilitation of category 4 and 5s in the collection system.”
He added, “There’s a new lift station proposed at 1st Street to help with that East End of town, and the collection pipe that is hanging off the vehicular bridge, that is one of the category 4s.”
He explained that some “emergency repairs” have salvaged it for now, but it needs replacing.
He said that the list of category 5s is growing, “but not exponentially,” so the district should rehabilitate the category 4s before they turn into category 5s.
He broke the rehabilitation of the system into phases, with phase 1 being the rehabilitation of category 4 and 5 sewer pipes and “lagoon decommissioning.”
He said, “Currently, for phase 1a, the rates reflect that we can support a debt service of up to $4 million for the first phase, and that’s just to get us going.”
He said that once the district moves into phase 1b, and “beyond, we’d have to, at that point, consider raising rates” on customers, as well as continuing to seek other funding such as grants and congressional appropriations.
This was described by Harris as a “build as you sail” method of addressing the issue.
“It should be noted, too, that as we move forward … we are literally looking at all sorts of funding, from bond funding, to help us get started, to grant funding, as well as the state’s revolving loan fund,” Harris said.
Mayor Shari Pierce asked both Johnson and Harris if “the ask for tonight is for us to start moving down the path of phase 1,” to which Harris replied, “That is correct.”
Board member Mat deGraaf wanted clarification that the current rate structure could support the district beginning phase 1 without a rate increase, with Johnson saying that it could support the district beginning the project.
Johnson reminded the board about the urgency to get started on the project.
“We found one [a new category 5] last week. We don’t have time to wait for grant funding. It needs to be done now, or we’re looking at a catastrophic event if we don’t do something,” he said.
Pierce then asked Harris to walk the board through a few options, either for the town to loan some money from its general fund to the PSSGID or to apply for a $2 million bond request.
Harris suggested that the town has funding that could support a loan to the PSSGID, adding that if the board chose the loan or going for an immediate bond, “We need to make this happen … we need to get moving on something here.”
Harris added that if the board chose a loan, that it should start with a smaller number until the town gets a financial advisor on board to make sure a larger loan is fiscally sound.
He recommended tabling the discussion until a financial advisor could be approved at the next town council meeting.
But deGraaf asked if it was possible to loan the PSSGID a smaller amount of money than the $2 million originally being asked for so staff could at least start tackling some of the most immediate threats to the system.
Johnson indicated that it was possible.
Board member Madeline Bergon asked how much Johnson would need to get started repairing some of the most damaged pipes.
“I mean, I’d take $500,000. I’d take a million. It needs to just start,” Johnson said.
Pierce asked for an amount that “could get you through the emergency of, say, the next four weeks, while we seek a financial advisor and get advice and then determine whether we should get bonds or continue down the path of a loan.”
Johnson stated that he could get started on the project with $500,000 on hand.
Harris explained that the money would help the town’s public works staff “get kick-started on some of these truly known problems and repairs, and we need to get the engineers in there to design and get us ready, so that we can move forward with the bigger steps forward.”
Board member Leonard Martinez said that he had enough information to make a motion to make $500,000 available from the town’s General Fund for this project until the board makes a decision on the best way forward financially for the larger project at hand.
The motion was passed unanimously by the board.
deGraaf said, “As someone who works in the industry, the weather windows are closing quickly, and I don’t want the guys in the field to get put off for another month to make what I already assume are going to be unpleasant repairs, so the sooner they can get going, the better.”
derek@pagosasun.com
