The Ligonier Township Municipal Authority must decide which of two major projects to prioritize after recent bids for the well project were nearly double its estimate.
When the board opened bids for the Waterford well project Nov. 2, both of the bids were more than $500,000 than expected. The bid from Wayne’s Water and Wells was $813,000 while Ligonier Construction’s bid was $932,000.
The authority board at its previous meeting asked its engineer, Jake Bolby, and authority manager Anthony Griffith to review the bids and ensure the math “checked out” with what it was seeking to do.
A significant portion of the cost in both bids was the temporary laydown pipe – which is similar to a fire hose – that the Pennsylvania Department of Environmental Protection had requested be used. Bolby said the cost was around $19 per foot, the cheapest pipe option available. With the project needing to run an estimated 7,000 feet of pipe to the designated discharge area, the cost just for pipe is well over $100,000.
Bolby also clarified that the authority would not own the temporary pipe, it would be kept by the awarded company which is a standard practice, he said. Board member Bill Stablein said he didn’t understand why that is the case when they are purchasing the materials.
“It was not clear to me, with the way that bid was, that we were renting things, I thought it was cut and dry,” he said. “Why would we make (the contractor) rich if we paid for the pipe?”
Bolby said there are a few items along with the pipe, like pumps for discharging water, that are rented and not purchased by the authority.
The Waterford well project came to be when the authority was told by PDE the Glen Kalp Reservoir was undersized and in need of upgrades about two years ago. At the time estimates for the upgrades exceeded $1.5 million, according to board member Dan Resenic. Both Resenic and Griffith said they believe those costs would be much higher now due to increased prices in construction.
The current well drilling project is just a test to see if it is a viable, cost-effective alternative to the reservoir.
“So if we drill the well and it costs us what it costs us, over the next 20 years, it’s probably the smart thing to do,” Resenic said.
Griffith said the well project is a risk.
“This is the million dollar gamble, if we are going to be able to even do this,” he said.
Griffith added it could be another $700,000 to build the well, which would bring the cost more in line with the projected dam upgrades.
Along with the well project, the authority hoped it could receive part of $205.4 million in state grant money to replace a problematic waterline along state Route 271.
That waterline has been the source of constant breaks due to high pressures and air buildup in the line. The authority recently installed pressure relief valves along portions of the line, which have helped but are not a permanent solution.
The authority is seeking about $1 million in H2O PA grants which would require it to “match” the funding with at least $500,000 of its own money.
But now with the potential overhead of the well project, paying for both would “deplete” most of the authority’s reserves, Griffith said. The authority tries to keep about $1 million in reserves, he said.
Griffith suggested the board try to get funding for the well project through the upcoming U.S. Department of Environmental Protection grants and focus on repairing the Route 271 waterline.
“If you are asking me which is more important, (Route) 271 or the well, I think 271 is more important,” Griffith said. “If we apply for any grant, it will be a year to a year and a half out whether we get it or not which gives us some time to build some capital.”
The authority would spend anywhere from $600,000 to $700,000 of its own money, which includes the match requirement of the grant, to replace the line, Griffith said.
If the authority were to try and pay for both projects as they stand now, it would have to raise its water rates by at least $5. Current rates are $20.50 per month which includes 1,000 gallons of usage. If the authority were to hold off on the well project while it seeks grant funding, it could get the Route 271 line replaced without raising rates, but Griffith suggested the board increase rates by $1 to $2 so there isn’t a shocking increase down the line.
Resenic said the lack of small price increases over the years has led to degraded lines like those along Route 271, which now need major repairs.
“Cheap water, poorly maintained systems, period,” Griffith said.
Vice Chairman Christopher Light added rates were increased about two years ago to build reserves for the future $4 million sewage project and that those costs have already increased to a little more than $5 million.
“So, we’re going to have to bridge that gap at some point,” Light said.
The authority has 60 days from the opening of the bids to make a decision on the Waterford well project before those bids are nullified. Applications for the H2O PA grants are due by Dec. 21.
The LTMA will meet again 4 p.m. Wednesday, Dec. 7, at the Ligonier Township Municipal Complex.