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B.E. getting nearly $1.3M

By Staff | Jun 29, 2009

The City of Blue Earth got a double dose of good news when it came to their new wastewater treatment plant expansion project.

First, the bids came in much lower than the engineer’s estimate had been. Then, the federal government gave the city a second big chunk of stimulus money to help pay for it.

At their last regular meeting, on June 15, the council accepted a low bid for the project from Joseph Company for $1.719 million. It was the lowest of the eight bids received.

The engineer’s estimate had been $2.139 million.

Then this week the city got the news that not only were all of their requests for grants approved, they were getting an additional one.

First, there is a grant for $317,130 for the project coming from the Clean River Funds, City Administrator Kathy Bailey reported.Next, the city is getting $346,164 from the federal stimulus funds, or American Recovery and Reinvestment Act (ARRA).

The bonus money is coming as a supplemental grant from the stimulus funds in the amount of $595,366.

“The city got this second federal grant because we are using it to service one major industrial user – Kerry Foods and Flavors,” Bailey said. “They feel it is the type of project they should be funding with stimulus money.”

The grants come to a total of $1,258,660 for the project. The remaining amount ($789,000) will come from the state through the Public Financing Authority, Bailey said, in the form of a loan. The total includes the contractor’s bid amount plus bonding costs and contingencies.

That PFA loan will be repaid through sewer rates, specifically an industrial user rate with Kerry.

Bailey says she had originally scheduled a special city council meeting for last Monday to discuss the industrial user rate with Kerry. However, with the new grant, the amounts have all changed so the meeting was postponed.

“It is a very good problem to have,” Bailey said. “This will mean lower sewer rate increases for everyone.”

This wastewater treatment plant upgrade is Phase II of a multi-year project, Bailey says. It is scheduled to be done yet this summer.

Phase III, on the docket for 2010, involves a new storm sewer line in the Fourth Street area of Blue Earth. Bailey says this part of the project is necessary due to infiltration of the storm sewer system into the sanitary sewer system.

“It will include a new large storm sewer line down Fourth Street,” Bailey says. “That also means new streets, water and sewer lines for residents along the street as well.”