Council approves contract to design sewer treatment plant
$4.3 million contract first part of total $31.6 million cost 
by Brian DiTullio

CAVE CREEK – Town council at its Monday meeting approved the overall contract for the construction of a new wastewater treatment plant, including the funding for the design phase.

Council received a presentation, recapping a work session earlier this summer on the proposed cost to design, build and operate the new wastewater treatment plant. Phase 1, the only phase approved for funding, will cost $4,343,431. This includes the design and pre‑construction costs, operating the existing plant for two years and a $250,000 town‑controlled contingency.

Most of the funding will come from a Water Infrastructure Finance Authority loan, according to Al Drescha, one of the design engineer consultants. The only costs not covered by WIFA are the plant operations, estimated to be $542,904 for Phase 1.

Drescha said they have worked out a two‑year time line, with design planning beginning next month and completion and permitting completed by July 2008. Pipeline construction would begin in April 2008, and the entire project would be finished in September 2009.      

The plant is estimated to cost $24.8 million to construct. Total costs, including plant operations, all design costs and an additional town‑controlled contingency of $1.75 million, added up to $31.6 million. However, approximately $2.2 million of that cost is for operations, which wouldn’t be covered by the WIFA loan.

Later on in the meeting, council approved the application of a $26.1 million WIFA loan to cover the rest of construction and design costs for the new treatment plant.

Approval of financing for Phase 2, plant construction, would happen no later than July 2008, according to Drescha, once again stressing the council only is funding Phase one at this point.

Drescha also explained the town‑controlled contingency money is under the complete control of Cave Creek and Town Manager Usama Abujbarah to fund any changes the town deems necessary. This money is not for the contractor to spend or request.

The measure passed by unanimous vote.

The town now has borrowed more than $50 million from WIFA, according to council meeting minutes and agendas. Including the $26.1 million loan for the treatment plant on Aug. 20, the town also borrowed $20.1 million to purchase Cave Creek Water Company this past spring, $6.6 million to purchase and make improvements to Desert Hills Water Company during the last year, and more than $6 million to purchase the land for the new treatment plant.

According to Town Accountant Marian Groeneveld, approximately $6.6 million of the monies borrowed have not been spent and will be used toward the design of the new treatment plant and water system improvements.

However, the numbers show a shortfall of about $2.6 million between funds on hand and projects approved. Groeneveld said the town would be meeting with WIFA in the near future to discuss how to close this gap.