City to seek grant for Interceptor

The Lebanon City Council approved a request by city staff to apply to the Oregon Department of Environmental Quality for up to a $14 million loan to pay for an extension to the Westside Interceptor, a sewer main, which would allow the city to lift a partial moratorium on new development.

The city has received a draft of a report from David Evan and Associates outlining the existing Westside Interceptor’s lack of capacity, said Engineering Services Director Ron Whitlach. “It’s not anything that we didn’t already know.”

The WSI has some capacity left when the weather is dry, but in five-year and even three-year storm events, storm water exceeds the WSI’s capacity, he said. That is driven by infiltration, ground water entering the system through leaking pipes and manholes, and inflow, storm drainage flowing into the wastewater system.

“We don’t have any, per se, direct connections (to storm drainage) that we know of,” Whitlach said, but city staff members are looking for possible sources throughout the 62-mile sewer system. They also plan to continue flow monitoring in the system to locate how much different neighborhoods are contributing to the system.

During storm events, the water levels in the WSI reach the top of the manholes, he said. So far, staff members have not seen any overflowing.

Some areas of town must connect to the existing WSI, but it lacks the capacity for new development, he said.

Other areas, primarily on the south end of the city, will need to connect to the new portion of the WSI, which currently ends at the intersection of Oak and Airway.

Until the city can expand the capacity of the WSI, it will not issue permits for any new construction that must connect to the WSI, Whitlach said.

It is issuing permits for projects that have already gone through the planning process, for existing buildings and emergencies, such as a septic failure.

The area under the moratorium includes most of the area south of Walker Road and east of Highway 20 between Walker Road and Airport Road. A section from 7th Street west between Vaughn Lane and Walker Road is not part of the affected area.

The affected area includes approximately 40 percent of the city’s overall residential mixed density zoning, Whitlach said, and it’s a much higher percentage of undeveloped property.

To relieve pressure on the existing WSI, he recommended that the city apply for at least $5.5 million in a loan from the state to help pay for a $9 million extension of the western leg of the WSI from Oak and Airway south to the intersection of Walker and Stoltz Hill.

Drawings are 75 percent complete for that phase of the extension, he said. The city is modeling flows to verify if the project will provide relief to the existing WSI and allow new development east of Highway 20.

The city has $3.5 million in funds budgeted for the project, Whitlach said. It will be able to borrow $5.5 million from the state without increasing service rates because the city will pay off a sewer system debt, with annual payments of about $522,000, in 2021.

The project would require the reconstruction of Walker Road to 6th Street, he said, and construction would likely begin in spring 2020.

In the next three fiscal years, the city will pay off debts with annual payments of $925,000, he said. That may make a second option possible, extending the line farther, to the area of South Main Road and Crowfoot Road, some 18,000 feet of pipe, at a cost of $17.5 to $18 million, requiring a $14 million loan from the state.

The project would likely take more than two years to complete, Whitlach said, and city staff is looking into additional options for funding, like new systems development charges in specific areas, that would avoid burdening existing property owners with higher service rates.

Choosing the second option has risks though, Whitlach said. It would take most, if not all, of the funds for debt service that will come off the sewer fund in the next few years, leaving no funding available for other projects other than solids handling.

That could change when the city completes its new master plan, Whitlach said, and predicting ever-changing environmental regulations is hard.

The city is planning to enter mediation with Jacobs Engineering over the handling of solids from the Wastewater Treatment Plant, Whitlach said, so the outcome of that remains unknown.

Not completing the second option also comes with risks, Whitlach said. It will lead to no future development in a majority of the city’s buildable mixed residential zoning until the WSI can be extended, maybe years from now.

Councilor Karin Stauder suggested the city should pursue the loan for the second option, noting that the city can scale back the project if necessary. Councilor Rebecca Grizzle agreed.

“We can wait another year,” Whitlach said. The reality of this, if we do option two, we’re looking at a three-year project.

“We’d like to dig into option two a little bit more. We have a pretty good handle on cost. We want to look and see what option two does to our debt service. I don’t think it’ll increase it.”

“For the lack of development that’s going to happen, if we don’t do something like option two, I don’t know what we’re going be able to do,” said Mayor Paul Aziz. “We have to be aggressive on it.”

The council approved option one and the application process for the loan for option two, up to $14 million.

Whitlach said the council would have to take action to accept the loan if it is awarded.

Present at the meeting were Wayne Rieskamp, Grizzle, Aziz, Stauder and Robert Furlow.

Absent were Jason Bolen and Michelle Steinhebel.

In other business, the council:

  • Approved a resolution to remove two downtown parking spaces based on a lack of visibility while making turns. The first is on the west side of Park Street south of the intersection with Sherman Street, and the second is one space on the east side of Main Street north from intersection with Vine Street. Stauder voted no, saying she was concerned about the loss of parking for business owners on Park Street, but she said she was OK with eliminating the space on Main Street.
  • Approved a resolution to amend a resolution levying taxes to include the amounts for delinquent sewer and storm drain charges for customers who do not use water service.  Finance Director Matt Apken said the city must wait until the end of June to include the full amount for Linn County, which imposes the charges as a tax on the properties. He said the city had $19,000 in delinquent sewer charges and $6,000 in delinquent storm drain charges.
  • Approved an update to the Deadly Physical Force Plan for Linn County, including changing the  term “SB 111” to read “ORS 181A.780” and alphabetizing definitions.