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3. Sewer Extension - Whitefish Stage RoadCity of Kalispell Public Post Office Box 1997. Kalispell_ Montana 59903-1997 - Telepllos e (406)758-7720, Fax (406)158-7831 REPORT TO: Mayor and City Council FROM: James C. Hansz, P.E,, Director of Public SUBJECT: Sewer Extension Whitefish Stage Roat MEETING DATE: Work Session, July 26, 2004 Background: Growth in the NE corner of Kalispell along the Whitefish Stage Road corridor has continued at a steady pace so that today a majority of the developable land south of Reserve Drive has been platted in subdivisions. What remains to be developed will essentially use the available remaining capacity of key sewage collection facilities, i.e. lift station #9 and its force main. Other sewer mains serving recent developments will continue to have carrying capacity, beyond their immediate needs, which could support additional sewage flows from new development, potentially north of Reserve Drive. This memo was requested to explore potential issues related to the City extending facilities in order to assure that potential future development is planned with municipal sewer service in mind and the City is able to exert positive influence toward this objective. Current Considerations: Substantial development interest has recently been shown in properties north of Reserve Drive along Whitefish Stage (WFS) Road and, potentially, east along Rose Crossing. At least two approaches are possible for this development: 1) Large lots served by on -site (septic) systems (or their equivalent) could be created. 2) Alternatively, a higher density development is possible if municipal sewer service is made available. Municipal service could be obtained through extensions of existing City of Kalispell systems installed along Whitefish Stage Road south of Reserve Drive. Extension of City Systems: Sewer Mains - The distance from Glacier Commons to Rose Crossing is about 7,300 feet. A main sewer to serve this area would likely be sized at 12 inch to 15 inch diameter to ensure adequate long-term capacity. Based on current bid costs, and without having completed any detailed engineering, this extension could cost approximately $427,750, inclusive of engineering, construction management and contingencies. This figure includes July 26, 2004 Whitefish Stage sewer.doc approximately 20 manholes, but does not anticipate any lift stations because, in general, the slope from Rose Crossing to existing City systems is favorable. However, there would be additional costs to upgrade some existing collection system facilities shortly after any development north of Reserve came on-line. Upgrade Existing Systems — Lift Station #9 is located just off Fairway Boulevard and serves as the main pump station for all development in this area. Other local lift stations are sited in Village Greens but are not impacted. Lift Station #9 employs a 6 inch diameter force main to deliver sewage across the Stillwater River into the City's gravity sewerage system. The lift station and force will require replacement to handle the added loads imposed by significant development north of Reserve Drive. Replacement costs for LS #9 and its force main were included in the City's long range Capital Improvement Plan. Lift station #9 is estimated to cost approximately $108,000, including engineering and contingencies, and the cost to replace the force main is estimated at approximately $508,000. One caveat: There may be a need to revise the currently estimated sizes of these upgrades depending on the scale of growth north of Reserve. Overall, the estimated total cost for all the improvements needed to fully serve this area is $1,043,000, and this is shown on the attached summary. Potential Method of Payment: These improvements involve two categories of origin: 1) growth -related facilities, reflected in the new pipeline and any additional capacity in the upgraded force main and lift station, and 2) replacement related facilities reflected in the costs to duplicate the capacity currently existing in the force main and lift station. Growth -related costs could be funded from current collection system SDC funds and then repaid via new connection charges, i.e. SDCs that are paid at the time of new development. There is presently approximately $1,150,000 in the sewer collection system SDC account available to support growth -related improvement costs. Further, each new dwelling will add and additional $865 to this account (the remainder of the current $2,070 SDC connection fee is devoted to WWTP plant replacement). Therefore, each 1,000 new units will generate $865,000 of additional revenue to the sewer collection system SDC fund to defray growth/capacity-related improvement costs. There is sufficient funding in the collection system SDC account to allow for construction of the WFS pipeline without impacting any near -term plans. However, the current schedule of SDC fees would need to be revised to include these facilities because they were not included in the CIP when SDCs were recently revised. Failure to make this adjustment would require deferral of some other improvements of similar value until SDC fees and attending revenues are adjusted upward. An alternative to fund growth -related improvements would be to authorize a surcharge upon the normal SDC fee. This would be related to any connections made to new growth -related facilities along WFS Road that are funded from the City's SDC account. This would be similar to the late -comer surcharge envisioned for the Developer Extension Agreement concept except that the City would be the final recipient of the surcharge which it would use to replenish the SDC account for the initial investment made to provide facilities that serve the new developing areas. Costs for replacement -related improvements to upgrade LS ##9 and its force main would likely be paid via a low interest Board of Investments loan with the loan repaid via the monthly user charges. The current replacement account does not have sufficient funds to cover these costs after accounting for current replacement plans. However, this method of repayment was anticipated when rates were recently adjusted because these projects are included in the CIP which formed the basis for the current sewer utility rate structure. The precise amount of the cost split between replacing current capacity and new growth -related capacity cannot be determined at this time without significantly more engineering to better define the facilities that are needed. Conclusion: Growth in the Whitefish Stage Road area is continuing and new facilities are needed to serve the area with municipal sewer. The facilities could potentially be provided piecemeal by developers, or they could be provided along the corridor by the City to assure that municipal services are immediately available and ready to serve an area which many believe is a logical extension of the City. This would prevent an undesirable expansion of development that depends upon on -site sewage disposal which local history has shown to be detrimental to both ground water and surface water. When new growth occurs along WFS Road, certain other existing City sewage collection facilities must be upgraded to ensure uninterrupted service. Funding new facilities is a challenge but is possible within the financial framework the City has in place. Many of the needed facilities have been programmed into the current CIP, while others have not. If the City chooses to install and fund the growth -related improvements necessary to accommodate community expansion north of Reserve Drive some modification of current policy will need to be considered. This would be similar to the action taken when City initiative resulted in the extension of utilities south on US 93 in conjunction with MDT plans to improve the highway into Kalispell. Juty 26, 2004 Whitefish Stage sewer.doc Preliminary Cost Estimate for Gravity Sanitary Sewer from Glacier Commons Subdivision to Rose Crossing along Whitefish Stage Road. 7,300 linear feet of sewer main @$35.00/ft.... ............. $255,500 20 manholes@$2,000.00/ea....................................... 40,000 Upgrade capacity of Pumping Station No. 9................... 73,700 Upgrade capacity of Force Main from LS No. 9.............. 350,500 Subtotal ................. $719, 700 20% Design & Construction Management ..................... 143,9Q 25% Contingencies ... ............................. ....... .............. .... 179,925 Total. .................... $1, 043, 565