Rayonier tank cost climbing

PORT ANGELES — The cost of a large water tank to the city of Port Angeles is about to escalate to a total of about $3 million, while ownership of the structure remains just out of reach.

The cost of designing the infrastructure that would allow the city to use a 5-million-gallon tank owned by Rayonier Inc. to store untreated sewage will cost up to $970,000, according to city engineers.

The City Council will consider approval of those costs, along with an additional $180,000 in other design work, as part of its combined sewer overflow project on Tuesday at 6 p.m. at City Hall, 321 E. Fifth St.

That $1.15 million in new costs will compensate Brown and Caldwell of Seattle for the design work.

The city’s contract with Brown and Caldwell for the project has already reached about $1.85 million.

The city has no guarantee that it will be able to buy the tank from Rayonier.

Company executives have told city staff members and the Peninsula Daily News that it will not sell the tank to the city unless the rest of the 75-acre property it sits on is acquired by the Harbor-Works Public Development Authority.

If Harbor-Works doesn’t acquire the property, the city will not be able to buy the tank — that price has not yet been decided — and the city could have a $3 million system design that could not be built.

“It’s a leap of faith,” said City Council member Dan Di Guilio at a city Utility Advisory Committee meeting on Tuesday.

Ecology order

The city is taking that leap because it is under a 2006 state Department of Ecology order to nearly eliminate untreated sewage from overflowing into the Port Angeles Harbor and Strait of Juan de Fuca by 2016.

The city will be fined $10,000 a day by Ecology if it does not meet that deadline.

The city is seeking an extension.

Untreated sewage overflows the city’s containment barriers during heavy rainfall.

The city wants to use the tank to store the sewage, where it would then be drained into the city’s water treatment plant adjacent to the Rayoiner property on the east side of the harbor.

The city estimates it will cost between $32 million and $42 million for the entire project.

It has borrowed $10 million from Ecology and is repaying loans through $2-a-month increases in wastewater utility rates every year.

City officials expect to have to borrow the rest of the money for the project from Ecology.

The wastewater utility rate increases, which began about four years ago, will last 12 to 15 years, Glenn Cutler, city public works director, has said.

City Engineer Steve Sperr said about two-thirds, or $647,000, of the $970,000 design estimate is unexpected costs.

Additional costs

The additional costs are due to the city having to adjust the route the pipes, which would carry the sewage through the Rayonier property, will have to take in order to avoid wetlands, he said.

Under the current plan, pipes covered in 2- to 3-foot soil berms would run parallel to the Waterfront Trail to the tank and water treatment plant.

City staff members say that acquiring the tank is the most efficient and cheapest way to comply with Ecology’s order.

The city has fallen behind by about a year on timetables set by Ecology for the project because it could not get approval from Rayonier to access the property, Cutler has said.

City staff will have access to the Rayonier property from April through March 31, 2012, because of a license agreement with the company approved by the City Council on March 3.

The agreement will cost the city $5,000 a year and allow Brown and Caldwell and city staff to access the property to finish the design work for the project.

Sperr said the city did not include the $1.15 million in additional costs to Brown and Caldwell’s contract because the city did not know if it would get access to the property to finish the design work.

Sperr said the city can still meet the 2016 deadline if it can get the tank from Rayonier.

Property condemnation is still an option for the city after the agreement expires.

Harbor-Works

Harbor-Works comes into play because it was created by the city and Port of Port Angeles last May to assist in the environmental cleanup of the Rayonier property and direct its redevelopment.

One of the city’s goals was also to get the tank at no cost in exchange for the public development authority taking on cleanup liability for some, if not all, of the property.

The cost of the tank has yet to be determined by Rayonier.

The five-member Harbor-Works board, appointed by the city and port, intends to have a formal agreement with Rayonier that would lead to property acquisition signed by April.

Acquiring contaminated property will make it a liable party under state environmental cleanup law.

The property has been an Ecology cleanup site since 2000 and is contaminated with pockets of PCBs, dioxins, arsenic, cadmium, mercury, lead and other hazardous contaminants created during the 68 years a Rayonier pulp mill operated there. The mill closed in 1997.

In 2000, the U.S. Environmental Protection Agency called the site “moderately contaminated,” perhaps 2 or 3 on a scale of 10.

Remnants of an ancient Lower Elwha Klallam village are buried under some of the property, and the tribe is a partner in the state-supervised cleanup.

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Reporter Tom Callis can be reached at 360-417-3532 or at tom.callis@peninsuladailynews.com.

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