Monday, June 27, 2022

Bid for Brunswick County sewer plant expansion $8 million over estimates, H2GO asks for analysis

Initial plans to expand Brunswick County's Northeast Wastewater Treatment Plant include doubling the plant's ability to process wastewater, which was nearing 90 percent capacity in 2016. (Port City Daily/Courtesy Brunswick County)
Plans to expand Brunswick County’s Northeast Wastewater Treatment Plant include doubling the plant’s ability to process wastewater. (Port City Daily/Courtesy Brunswick County)

BRUNSWICK COUNTY — The lowest bid to add 2.5 millions of gallons of daily capacity to the Northeast Wastewater Treatment Plant, currently under a state-mandated new line extension moratorium, is $10.26 million more than estimates that budgeted expansion at $32.1 million.

Two associated transmission main improvement projects to serve the expanded plant came in $1.39 million less than estimated. In total, the entire plant expansion project will cost $47.76 million under the lowest bidder T.A. Loving.

Related: Brunswick County aims to issue $260 million in revenue bonds, water financing still not final

That’s $8.66 million more than expected in total, according to bid documents provided by Brunswick County.

Tuesday, Brunswick Regional Water and Sewer H2GO Commissioners unanimously agreed to send Brunswick County requesting further analysis on the proposed expansion. As of Thursday, Brunswick County has not yet received the letter. Friday, H2GO’s spokesperson said a copy would be provided upon its completion.

Bond in the works

Monday, Brunswick County Commissioners signed off on a bond application, sent to the Local Government Commission (LGC) late August. The county is seeking $260 million in combined revenue bonds to fund various projects, including a $123 million 2019 Series bond that includes funding for expanding the Northeast Wastewater Treatment Plant.

In the county’s LGC application, plant expansion and associated force main improvements are listed at their total estimated cost: $39.1 million.

Brunswick County Manager Ann Hardy said in a statement she was pleased the transmission main projects came lower than expectations.

“I was pleased that the bids for the transmission lines were under the engineer’s estimate and that while the bids for the plant expansion were over the engineer’s estimate, the staff believes that the close proximity of the bids and the number of pre-qualified contractors that bid the project indicates that the bids are reasonable for the scope of the project in the current market,” Hardy said in a statement.

Staff will recommend approving the bids, Hardy said.

H2GO asks for analysis

Brunswick Regional Water and Sewer H2GO, a major utility customer of Brunswick County, is contractually obligated under a recently-signed interlocal agreement to finance expansion at the Northeast Wastewater Treatment Plant.

The plant treated 92% of its permitted design capacity in 2018, violating the state 80/90 rule. This rule helps utility providers plan for capacity issues by requiring expansion permits be in place prior to reaching an average 90% of permitted capacity in a year.

According to the county’s LGC bond application, all necessary permits have been obtained (arguably the most important state permits, including the authorization to construct and National Pollutant Discharge Elimination System permit, were approved late last month).

Plant capacity at H2GO’s Chappell Loop Road plant was averaging at 90% permitted capacity in July and has neared capacity for years. However, the state is not enforcing the 80/90 rule at the plant because it’s under court order to not expand beyond its current 400,000 gallon-per-day capacity. Brunswick County sued H2GO in 2009 to prevent the utility from expanding and the court ruled in favor of the county.

At its meeting Tuesday, H2GO Commissioners entered into closed session to discuss its interlocal agreement with Brunswick County, signed in March. The agreement includes a provision that H2GO is obligated to pay its allocated cost share of the plant expansion —  $18.38 million.

“So with that overage on the bids received, it would be my recommendation to the board that we ask the county to evaluate the engineering study,” Bob Walker, H2GO’s executive director, said to explain the motion Commissioners had just approved following the closed session.

H2GO’s cost share is provided in the percentage of total project cost and includes estimates. It is not clear if the contract obligates H2GO to pay its agreed-upon cost share percent, regardless of the actual project cost.

Under the lowest bid, H2GO obligation jumped 20%, from $18.38 million to $22.44 million.

This diagram (without the red highlight and note added by Port City Daily) is included in H2GO and Brunswick County's interlocal agreement for funding the Northeast Wastewater Treatment Plant expansion. (Port City Daily/Courtesy Brunswick Regional Water and Sewer H2GO, edited by Port City Daily)
This diagram (without the red highlight and note added by Port City Daily) is included in H2GO and Brunswick County’s interlocal agreement for funding the Northeast Wastewater Treatment Plant expansion. (Port City Daily/Courtesy Brunswick Regional Water and Sewer H2GO, edited by Port City Daily)

Leland has signed its interlocal agreement on the expansion. Meanwhile, Navassa has not, and it appears the town will not anytime soon.

Assigned to pay $8 million (with new bids, $9.8 million) and cover 20.5% of the project cost, Navassa has not obligated itself to project costs. The town’s mayor disagrees with the allocation given and has asserted his low-income, rural town cannot and would not be approved for an $8 million debt under LGC requirements.


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

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