Surrounding cities dispute Logan’s wastewater plant funding

LOGAN – Logan and six of its surrounding cities need a new wastewater treatment plant, but differences in needs and ideas between them has created uncertainty in who will use the plant and how it will be funded.

The new $110 million plant will be constructed within the next five years. According to Logan City Mayor Craig Petersen, the need for a new facility came after the Utah Division of Water Quality and the Environmental Protection Agency informed Logan that the treated water from the lagoon ponds being discharged into the Cutler Reservoir contains too much phosphorus and ammonia to meet federal standards.

“There are a lot of choices to be made,” Petersen said. “We’ve identified part of the technology. We’ve identified the design of the project. We’ve also put together a package for financing it because we have to borrow the vast majority of that money and we’ve been able to secure pledges for loans at low-interest rates to do it which will save the citizens money. So now we are in the process of continuing the design.”

In addition to Logan, six other cities in Cache Valley use the wastewater system. North Logan, Smithfield and Hyde Park connect to it from the north while Providence, River Heights and Nibley connect to it from the south. As it stands now, Logan will own the plant and take financial responsibility for the project and will charge other cities a fee for use. Officials from the surrounding cities have expressed concern with how the new system will be funded, specifically citing excess of revenue generated from the fees charged to residents of the surrounding cities.

“With the current system, Logan reviews their revenue situation and at the end of the year if there’s a revenue surplus they move that into their general funds,” said North Logan Mayor Lloyd Berentzen. “But then, that could be money that is paid in by other cities year after year.”

Providence Mayor Don Calderwood agrees that excess of revenue is a big concern with the plan. He said that Logan has been very upfront with the other cities about their plan, but doesn’t agree with it. “Logan is legal in doing this,” he said. “They add percents on to these fees. So if I’m putting $29 a month into the sewer rate approximately eight percent of that is not just the cost, not just the maintenance, not just the administration, it turns into what I would interpret as profit. Then they take that profit and they transfer it to their general fund which they can use for anything.”

Mayor Petersen said it is true that the money goes to the general fund, but that it covers other real costs incurred with operating the wastewater plant.

“We take all the risk for the district,” he said. “We provide the legal scale on that. We provide the public services for that. Some of that money goes to reimburse Logan for costs that we incur for running a wastewater facility. So I think that’s totally legitimate.”

Calderwood said that the cities in the north and the cities in the south would be better off forming a district where all cities share financial responsibility, authority and decide the fees and the rates together. He said that Logan proposed an advisory board, but that scenario would still limit the surrounding cities and give Logan the final say.

“We’d really like this to be a process where there could be representation from each of the cities on the sewer district,” Berentzen said. “That will allow voters and those represented in each of the cities to have equal say.

Petersen said he understands the cities want more say, but said there are better ways to do that without forming a district.

“We think that’s a kind of a rigid approach because it has to be done precisely by state code,” he said. “We believe that there might be ways to do it that will give us greater flexibility.”

Petersen said the city is preparing a proposal that will give the other cities more say that they will hopefully agree to. Because of the concern the city officials have had, the cities in the north and south have begun to look at alternative options to wastewater treatment.

“The three northern cities have done a study to see the feasibility of doing their own sewer system,” Berentzen said. “That feasibility study came in at $23 million. When we look at what our share would be, whether to go through a district with Logan City or do our own at $23 million, as far as our preliminary things, it looks as though it may be very feasible just to do our own.”

Calderwood said the south cities possibly have the option of joining with Hyrum’s already-existing wastewater treatment plant and that engineers are working on a detailed proposal.

“It would probably be more expensive to begin with, but not in the long run,” he said. “The unique thing about this is that the folks that I have talked to in the south are receptive even if it’s going to cost them more money to begin with.”

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