Federal stimulus money helps lower costs
A couple of new buildings for the city’s water and sewer department could ultimately result in a increase on customers bills, although officials said the effect could have been a lot worse if they had not been successful in obtaining federal stimulus loans.
The City Council approved awarding contracts amounting to $1.924 million to Summit Construction Management, Inc., of Vero Beach, for the construction of a maintenance building at the Water Treatment Plant and a field services complex at the Wastewater Treatment Plant.
The city was able to receive a low-interest loan for the buildings, which could save it an estimated $600,000 over the 20-year life of the loan compared to what the city may have normally had to pay. The bid also came in about $600,000 below original estimates, said Water and Sewer Director Rob Bolton.
Still, City Councilman Tom White said there will be an impact on customer’s bills and provide ammunition for those arguing for consolidation of the city and county’s systems. He cast the lone vote against awarding the projects.
Customers could potentially see a 1.6 percent increase in their bills to pay back the loans. It was estimated the effect could be about 4 percent if President Barack Obama’s stimulus package money had not been obtained for them.
City Councilwoman Debra Fromang said the department needs to keep its operations modernized and efficient. According to Bolton, the current buildings were damaged in the 2004 hurricanes and some expensive equipment is now being exposed to the elements, although White argued the equipment could be put into storage elsewhere.
Bolton said the buildings will need to be constructed eventually and waiting to build them could result in higher construction costs without the benefit of stimulus money.
The city serves customers both within the city as well as some people living in the county and Indian River Shores under a franchise agreement set to expire in 2017.
Some of the customers living outside the city limits could decide by that time to be served by the county utility rather than the city utility, but Bolton said the buildings would still be needed even if the customer base is reduced by such a switch
