Monday, November 28, 2022

Brunswick County says it will reapply after state denies reverse osmosis funding request

The State Water Infrastructure Authority did not award any of the $27.7 million in funding Brunswick County applied for to offset planned expansion and improvement costs at the Northwest Water Treatment Plant.

Brunswick County's planned Northwest Water Treatment Plant expansion and upgrade project to address perfluorinated compounds will cost an estimated $137 million. (Port City Daily graphic/Courtesy CDM Smith, Brunswick County)
Brunswick County’s planned Northwest Water Treatment Plant expansion and upgrade project to address perfluorinated compounds will cost an estimated $137 million. (Port City Daily graphic/Courtesy CDM Smith, Brunswick County)

BRUNSWICK COUNTY — Funding for a solution to Brunswick County’s drinking water needs is still not secured. This month, the State Water Infrastructure Authority denied $27.7 million in funding assistance the county applied for last year to offset its water plant upgrade and expansion costs.

Brunswick County applied for a $20 million loan to fund its 12 million-gallon-a-day (mgd) expansion at the Northwest Water Treatment Plant to meet the region’s increasing water demands. It also asked for $7.7 million in assistance to cover the installation of a concentrate pipeline, required with a planned reverse osmosis upgrade, which the State Water Infrastructure Authority (SWIA) denied as well.

Related: DEQ denied CFPUA’s $47 million Sweeney grant request. Here’s why, and what’s next

A reverse osmosis upgrade was approved in response to the revelation about GenX and other perfluorinated chemicals in finished drinking water in summer 2017. Brunswick County Commissioners approved constructing the $99 million upgrade in May 2018.

The project is still waiting on approval of state discharge permits and construction has not yet begun.

Ann Hardy, Brunswick County’s manager, said Tuesday the county will submit a new application to the SWIA for its upcoming spring round of reconsideration. The SWIA reviews applicants semiannually.

What the SWIA does

Managed by a branch of the North Carolina Department of Environmental Quality (DEQ), SWIA awards federal and state low-interest loans and grants to local governments. The authority is tasked with overseeing several grant and loan programs that improve water quality.

On March 13, SWIA weighed in on applications it received in its fall 2018 funding round between five separate programs.  Of the 28 eligible drinking water projects received, SWIA approved 18, at a total of $40.9 million in loans.

Brunswick County’s $20 million loan application was one of 10 water projects that did not receive funding. SWIA found the county did not document a maximum contaminant level exceedance in its application. (Though there are suggested limits for GenX and other perfluorinated chemicals, they aren’t yet regulated.)

SWIA approved three grants and 16 loans out of 36 wastewater applicants. Brunswick County applied for $7.7 million under this program for its planned discharge contaminant pipeline. At nearly 4 miles, the concentrate pipeline will transport reverse osmosis discharge to the Cape Fear River off Mt. Misery Road in Northwest. SWIA denied the project because, for example, the county used sewer rates in its application. As the project is designed for the Northwest Water Treatment Plant, sewer rates are irrelevant.

Cape Fear Public Utility Authority’s (CFPUA) $46.9 million grant was also denied. CFPUA sought – through a one-time grant, not a loan – to fund its plans to upgrade its water treatment plant with Granular Activated Carbon. Only $900,000 in grant funding under the Drinking Water State Reserve Project was available, which was awarded to one applicant.

SWIA also found CFPUA failed to establish maximum contaminant level exceedance in its application.

Other funding options

The county is pursuing other options to fund its $137 million (estimates vary) water infrastructure plans. Plans to double Northeast Wastewater Treatment Plant’s capacity — a plant in critical shape late last year — show costs at $39.1 million. Total infrastructure plans, including four projects, are around $216 million.

Brunswick County is bundling those costs together in seeking a $120.8 million revenue bond. If issued, the bond will cover the following infrastructure projects:

  • A 12-million-gallon-a-day (mgd) expansion at the Northwest Water Treatment Plant
  • A 2.5 mgd Northeast Wastewater Treatment Plant expansion
  • A 54-inch Lower Cape Fear Water and Sewer parallel water main
  • A low-pressure reverse osmosis water system outfitted to treat 36 mgd

Before the bond is issued, the county needs approval from the Local Government Commission (LGC). The LGC will weigh in on whether the county is capable of handling that much debt.

“We have had preliminary discussions with the LGC staff about the county’s financing plans,” Hardy, the county’s manager, wrote in an email Tuesday. “The LGC staff raised no issues of concern.”

Hardy said the revenue bond application will be submitted around this upcoming Thanksgiving.

Up to $73 million for Northwest Water Treatment Plant’s expansion could be covered by Water Infrastructure Finance and Innovation Act (WIFIA) funding, according to the county’s consultant, CDM Smith. WIFIA provides up to 49 percent coverage on projects through long-term, low-interest federal loans, administered through the Environmental Protection Agency.

In January, though an application hadn’t been submitted, the county’s utilities director said it was unlikely to be denied. Hardy said the WIFIA application, already submitted, is now under review.

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Send tips and comments to Johanna Ferebee at johanna@localvoicemedia.com

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