Wastewater Cost Reductions: 2011 Archives

When Barnstable County executive Paul Niedzwiecki reported to the Chatham Board of Selectmen that centralized sewering was simply “unaffordable” for Cape Cod towns and they would have to turn to innovative methods and adaptive management practices to get costs way down, we have since learned that he had much more in mind than just the alternative and innovative technologies that would greatly reduce the cost of wastewater treatment that CCT has advocated and the Cape Cod Times (June 26, 2011) has editorialized in favor of – environmentally beneficial solutions such as neighborhood cluster systems that would return treated effluent to the water table while removing nutrients as well as any large wastewater treatment plant.

Just 14 months after appearing in Chatham praising the former town manager’s financing plan for Chatham’s centralized sewer, county executive Paul Niedzwiecki appeared before the selectmen and pronounced centralized sewering dead: it’s “unaffordable.”

Niedzwiecki said, Chatham, which like Provincetown “did the right thing,” might be able to recoup some costs by selling spare WWTF capacity to nearby towns. He suggested adaptive management could also help bring costs down for towns, including Chatham. The Commision's new "vision" will include centralized sewering, satellites, cluster systems and onsite treatment. Centralized sewering for all is and "old, unsustaiable" approach and simply "unaffordable."

Certainly, integrating alternatives such as cluster systems with the existing centralized system will not just save money and be friendlier to the environment, but, ironically, it will create even more spare capacity in the WWTF for regional use. The Cape Commission accepts that view since clusters are part of their Capewide plan, as shown in the graphic below.

Niedzwiecki was not sympathizing with Chatham for its taking on such an expensive project as we had originally thought. No, instead, he was delighted that the huge Chatham WWTF is on the way to completion in mid-2012. How that was engineered by Chatham town officials is not his concern. The main point for him is that the county is now positioning Chatham’s very large, new treatment plant as a super-regional wastewater disposal node high above Cockle Cove Creek and its marshes.

What CCT charged in 2009 and 2010 now appears to be confirmed: Chatham was building a regional wastewater treatment facility to serve several towns, not just Chatham. In light of Chatham’s declining population over the past two decades, the WWTF seemed to CCT to be substantially overbuilt. Our rough calculation was that the WWTF at full capacity could accommodate between 50,000 and 60,000 active water users at the very same instant, a highly unlikely event.

Indeed, at the February 2, 2010 selectmen’s meeting, Director Duncanson remarked that the new WWTF could handle wastewater from Orleans, Brewster and Harwich as well as Chatham’s.

However, the former town manager promptly disowned any inferences that might be drawn from the Duncanson remarks. He and Director Duncanson thereafter denied ever discussing regionalization with anyone besides Harwich and then only with respect to the Muddy River watershed. They also consistently denied the WWTF was overbuilt. Allow us to be skeptical.

It is difficult to escape the conclusion that Chatham town officials were building a WWTF – at Chatham taxpayers’ expense -- to be part of a regional system despite their protestations to the contrary.

From the county’s perspective, the more spare capacity the WWTF has the better. Therefore, integrating alternatives such as cluster systems and permeable reactive barriers works in favor of the county’s plan while saving Chatham taxpayers property tax dollars. There is no conflict between the county's overall plan and the use of alternative and innovative technologies within Chatham to bring taxpayer costs down.

CCT has only recently gained access to the county’s map of projected regional hubs with Chatham prominently identified. Add to that the language in the FY12 state budget and the words of the state Secretary of Energy and Environmental Affairs described below and the picture becomes clear.

The map below is from a Cape Cod Commission presentation in April, 2011. Will sewage from parts or all of Harwich, Brewster and Orleans be fed into Chatham? Will Cockle Cove Creek and its marshes be able to absorb all that effluent and fresh water draining from the water table into the deeply laid sewer pipes? DEP has yet to prove they can. The same questions are being raised in Orleans, another proposed regional wastewater treatment supersite, where residents are concerned about the future of Namskatet Marsh that straddles Orleans and Brewster.

Note that the map legend refers to a variety of approaches to wastewater treatment, including satellites, clusters and onsite treatment.

The county’s wording of its request for $150,000 in seed money in the state budget is instructive as to its plans. Outside section 187 to the FY12 budget is all about Cape Cod regional wastewater planning across town lines and cutting costs through sharing facilities and approaches. At the recent Cape Cod Commission press conference, the state Secretary of Energy and Environmental Affairs announced that priority for state low cost loans for Cape wastewater projects would go to those that are part of the regional plan.

Regionalization now appears to be the state and county goal for the Cape. It is likely that control over wastewater planning and implementation will be shifted from Cape towns to the county or some new or old Capewide body. In the negotiation with the Conservation Law Foundation (CLF) in its EPA law suit, one can expect that result to be written in.

Within towns there will be room for alternative and innovative technologies to keep costs down but the linked regional WWTFs will be under the control of the county or some Capewide authority which will be setting policy for all Cape towns. The goal of saving $2 billion by regionalizing treatment plants is certainly commendable, but experts tell us that 70% of a sewer system is in the piping. The county does anticipate use of clusters and other innovations within watersheds since integrating small pipes and other innovations where appropriate can play a role in saving costs. Niedzwiecki has admitted that with all the interest CLF and the EPA have in seeing the Cape’s nutrient problem addressed, there is no money on the horizon to help Cape taxpayers.

CCT’s goal has always been to bring costs down for taxpayers and avoid waste and unnecessary expense. As the county’s wastewater expert Robert Ciolek emphasizes, Chatham’s project is “expensive,” whether it’s $330 million plus inflation, $450 million or more. CCT is not opposed to regionalization as such if cost savings can be realized and the environment is better for it.

Whether Chatham voters would favor regionalization or not is not known, since it has never been put forward as an issue for discussion. Having sewage shipped in from other towns could be an emotional issue for some. It may be an environmental issue as well, since the pressure on Cockle Cove Creek and its marshes is bound to increase.

CCT believes that alternative and innovative technologies within towns can save as much as $200 million for Chatham taxpayers over the financing period. Perhaps connecting all towns regionally and running the operation centrally can save even more. The worst case sketched by the Commission would have just about every Cape town building out its own WWTF. If Chatham, just 3% of the Cape Cod land mass, has a cost of close to a half billion dollars for a centralized wastewater system, Capewide the number has to be $12-$15 billion in property taxes and fees during the financing periods if every town were to install centralized sewering. However viewed, the costs are staggering.

Centralized control worked for Greater Boston in the form of the Massachusetts Water Resources Authority. However, even there, a high CLF official has said (Cape Codder, May 8, 2009), in retrospect, it would have been better to have integrated some cost-saving neighborhood systems into the plan, since MWRA pumps so much water into the bay it is draining the area water table. He noted that the Cape should be especially conducive to the use of decentralized systems.

Whether centralizing will work as well for the Cape remains to be seen. Drawing up the plans will be a $500,000, two-year task, according to the FY12 budget and the Commission's press conference. But a lot more than $2 billion (the stated goal in the state budget) needs to be saved to get to an “affordable” level. (Mashpee already is planning a group of clusters instead of centralized sewering to save money and water for the water table. We do not know Mashpee’s current estimate, but, before its serious planning got underway, Mashpee was looking at the possibility of saving $300 million, before interest charges and inflation, over a centralized system.)

Having fewer WWTFs should indeed save a great deal of money, but they may increase local environmentatl concerns. Since most sewering costs are in sewer piping, CCT believes using small pipe cluster systems and permeable reactive barriers and other environmentally preferable and less expensive alternatives wherever possible can do more to help bring costs down. Even so, Cape taxpayers face daunting costs that will burden their properties for decades.

See the Cape Regionalization Plan accompanying this report for the state budget material and the Cape Cod Times article concerning the state/county press conference.

For the county regionalization presentation, see the PowerPoint Cape Regional WW Plan below, which should also be available on the Cape Cod Commission website.

Cape Regional WW Plan.ppt

Also. one can view the Cape Regional WW Plan showing Chatham as a super-regional wastewater treatment plant in pdf format, since not all viewers have PowerPoint viewers installed.

Cape Regional WW Plan.pdf

TO THE CONCERNED TAXPAYERS OF CHATHAM --

1. Barnstable County has made a dramatic turnabout on how to solve the problem of excess nitrogen in Cape Cod coastal embayments. Centralized sewering is out, it's simply "unaffordable." Other approaches are part of the answer, such as decentralized or cluster systems, which cost far less and are preferred by the federal Environmental Protection Agency for less densely populated areas such as Cape Cod towns.
2. The county has requested funds in the FY12 state budget to develop a Capewide plan utilizing centralized, satellite, cluster and onsite treatment to attack the nutrient problem troubling the Cape's embayments. .
3, Falmouth, a town of 30,000, has just voted $2.7 million to examine a very wide range of American, Canadian and European technologies from cluster systems to permeable reactive barriers to composting toilets. Town meeting feared the cost of a centralized sewer would drive families and long-time residents out of town. As one town meeting member said, "We don't want to become a gated community like Chatham."
4. Mashpee, more than twice the population of Chatham, is designing its wastewater treatment and disposal system around eight decentralized/cluster systems. It hopes it can save more than $100-$200 million by not doing a centralized system.
5. Orleans town meeting has also voted money to examine such alternatives. In fact, there will be a public forum on alternative and innovative technologies in Orleans this Saturday at the Old Jailhouse Tavern from 9 to noon. (See notice attached.) Experts from the West Coast and the East Coast will make presentations and field questions on why these alternatives make sense on Cape Cod.
6. What does all this mean for Chatham? A great deal. As county executive Paul Niedzwiecki told the Chatham Board of Selectmen, integrating alternative and innovative technologies into Chatham's wastewater plan could save property tax dollars. We believe savings could be as much as much as 25-40%.
7. What caused the county to drop its insistence that centralized sewering was the wastewater solution for Cape towns? We believe we know of one contributing factor. A knowledgeable and experienced consultant was brought on to analyze potential costs for the towns. The consultant had had significant involvement in the financial aspects of the Boston Harbor clean-up. The project cost billions and created a fierce and bitter fight in all the affected communities that was only resolved when the state legislature agreed to chip in. Even so, the per capita costs on the Cape would be five to six times what
they were for the Greater Boston communities. To get a sense of what numbers might be for Cape towns, the county made the consultant available to Chatham (and to other Cape towns) free of charge.

What the consultant found was that Chatham town officials had vastly understated likely costs. For a 20-year project like this, the consultant said the interest rate assumed was unrealistically low. In making any appraisal of costs, inflation is a factor to be taken into account. Also, the former town manager had not satisfactorily provided for operational and maintenance expenses during the 20 years of construction (estimated by Stearns & Wheler to be $30 million (before any allowance for inflation or borrowing costs).

The estimates produced by Chatham Concerned Taxpayers in 2009 and 2010 because town officials had failed to provide a realistic one took all these factors into account (even using an interest rate lower than the “optimistic” one suggested by the consultant) and derived a projected minimum cost to all property owners of more than $400 million in debt service charges on the property tax.

Not included is the estimated collective cost to those property owners forced to connect to the system, about $29 million. The total cost to taxpayers of about $430 million was almost triple the "full cost" estimate shown in the Warrant for Article 14 of the May 11, 2009 town meeting and about $160 million more than the costs presented by the former town manager at the selectmen's meeting of February 23, 2010.

An updated CCT estimate using the consultant's "optimistic" 3% interest rate and a 3.18% inflation factor derived from an EPA suggested approach for wastewater projects and borrowing construction period O&M along with borrowings for labor and materials costs produced a estimate of total debt service of approximately $460 million. As mentioned individual property owners will have additional costs to connect to the system. Approximately 2/3rds of Chatham's properties will be required to connect because they are in watersheds whose drainage has said to deposit nutrients in potentially vulnerable waters.

Both the consultant and Chatham Concerned Taxpayers used the same 2007 cost estimates prepared by Stearns &Wheler as the starting point. CCT calculated the inflation effect and the cost of construction period O&M as well as the estimated interest cost. The consultant only added his interest factor to the S&W starting costs and derived a cost incluidng interest but not inflation or O&M of $330 million, up 24% from the town official's estimate of $266 million in February, 2010. Although the town official did include a slide in his presentation showing 3% as an inflation factor, he did not take inflation into account in developing his estimate of taxpayer cost in debt service charges over the 50 year financing period.

8. With other Cape towns and the county now looking to cost-saving and environmentally preferable alternatives, Chatham taxpayers no doubt will also be interested in finding out how much can be saved on their property taxes. Clearly, the county has concluded that decentralized/cluster systems can do just as good a job of nitrogen removal as the best centralized systems (as has the EPA). Their new approach includes some centralized sewering and some cluster systems and some onsite systems.

Use of other innovative technologies can increase savings and even do a superior job of nitrogen removal with far less community disruption in a much shorter time period. And more good news is that Stearns & Wheler (now a unit of Australian-based conglomerate GHD) has just recently confirmed that it supports the position expressed by Director of Health and Environment Duncanson and the former town manager that there will be no adverse operational or financial effects if the expansion of the centralized sewer is limited to that which was authorized by the May 11, 2009 vote on Article 14. This means that in reworking the wastewater plan pursuant to the engineering principle of adaptive management the town has complete flexibility to redesign for a less costly and environmentally better result.

The recent forum in Orleans detailed why savings can be achieved in a more environmentally friendly manner. It was open to all residents of the Cape. Links to the presentations will be posted.

ORLEANS DECENTRALIZED SMALL PIPE WORKSHOP ORLEANS.pdf