Waynesville has gotten yet more dismaying news over the cost of rebuilding its beleaguered sewer plant.
The rebuild has clocked in $10 million more than the town had banked on due largely to rising costs of construction, steel and concrete — an increase of more than 50% over the initial $19 million estimate.
The latest blowwas a rejected state grant meant to offset rising construction costs. The town’s grant application was hampered by a mix-up at the state level over Waynesville’s economic designation.
“They said we were not sufficiently distressed,” Town Manager Rob Hites said. “We were surprised to find that out.”
The lion’s share of the state grant pool was earmarked for at-risk and distressed communities. Waynesville initially wasn’t on those lists.
Thanks to lobbying, the town got moved to the at-risk list and eventually to the distressed list, making its application more competitive. Or so it thought.
After the grant was rejected, the town learned it hadn’t been moved to the distressed list after all. Hites is still attempting to get to the bottom of the mix up.
“We asked why we were placed in a lower category and why we weren’t notified. We should have at least gotten a letter,” Hites said.
An analysis of grant awards by The Mountaineer shows communities in WNC came up short compared to the rest of the state, and that some counties even less distressed than Waynesville got grants — including Asheville and Highlands.
Out of 450 grant applications for water and sewer construction projects, 140 were awarded. Only 20 of those 140 came to WNC — defined as the 23 westernmost counties.
Of those 20, five were awarded to Yancey County alone, totaling $12 million in all. Yancey wasn’t on the distressed list, however, only the “at-risk” list.
Meanwhile, numerous communities that were neither on the at-risk nor distressed list for grants. Those included $5.4 million for Asheville sewer projects, $4 million for a Jackson County sewer project, along with the towns of Highlands, Brevard, Beech Mountain and Andrews — none of which were on the at-risk or distressed list.
Separate pots of money were earmarked for each economic designation. It’s unclear whether Waynesville’s grant application was even considered due to being put in the wrong category.
The state has now told the town it will be on the distressed list for the next grant cycle, but for a still unknown reason, the change hadn’t gone through for the most recent cycle.
While the town plans to try for the grant again come fall, its chances might be slim. By then, the town will have already pulled the trigger on the contract to rebuild the plant rather than continue a wait-and-see approach on the grant.
“Materials will just keep going sky high,” Mayor Gary Caldwell said. “If we don’t lock down this contract, they could ask for another couple million for something else going up.”
Once the town signs a construction contract, however, it weakens its claim that grant assistance is needed.
“You make the case in advance that you can’t afford to build the plant without it. It’s called ‘but-for’ — ‘but for this grant’ we couldn’t afford it,” Hites said.
But the waiting game for another grant round isn’t worth the risk.
“We will once again go fishing at the state level and see if we can get anything,” Hites said. “But we are at the point with this bid we can’t really wait any longer and risk it going up even more.”
The town has one last play in the cards to cover its funding shortfall for the sewer plant rebuild. Hites is hoping legislators who represent Haywood in the N.C. Senate and House could insert a line item into the state budget.
“I think it would be appropriate to request our legislative delegation to help us,” Hites said.
A review of the latest state budget shows scads of line-item earmarks for similar projects across the state. Southport, a coastal town of only 4,000, got a $2.8 million earmark for a sewer project, for example. The town of Clyde also got a $1.2 million earmark for water infrastructure projects, secured by Rep. Mark Pless, R-Bethel. Pless also secured millions in funding for projects in Canton and Bethel.
“We just ask to be treated like other local governments when the legislature looks at priorities,” Hites said.
The stakes are high for the 10,000 customers served by Waynesville’s sewer plant, including Junaluska Sanitary District, Lake Junaluska and the town of Clyde, which send their sewer to Waynesville’s plant.
Loan payments for the rebuild have to be absorbed by sewer customers, and the more the town has to borrow, the more the rates will go up. Sewer customers include numerous manufacturing industries, Haywood Regional Medical Center and Haywood Community College.
“We are the regional sewer plant for much of Haywood County, so they will be helping moderate the rates for a tremendous number of people — not just the citizens of Waynesville,” Hites said.
The town is expecting a groundbreaking on construction by December, with an estimated completion date of summer 2024.