Wednesday, September 22, 2010

Water Costs

The water supply resolution adopted unanimously by City Council this Monday night would result in a plan that not only provides abundant water for our region for 40+ years to come, but also minimizes destruction of our forest ecology, promotes water conservation and efficiency, improves stream flows to our rivers, upgrades our water distribution and treatment infrastructure, and does all of this at substantially less cost to our citizens than the plan it replaces.

If you're not yet convinced that there's a better, cheaper way to meet our long-term water storage needs, let's take a quick look at the numbers.

To enhance the storage capacity of our water system, the City's newly-adopted plan would allow for a scenario in which we dredge the South Fork Rivanna Reservoir, repair the spillway at the Lower Ragged Mountain Dam, and increase the height of that dam to expand the Ragged Mountain Reservoir by 13 feet.

Recently, two different dredging experts (one a dredging equipment manufacturer and one a local dredging company) independently submitted information indicating that dredging the South Fork Rivanna Reservoir is a relatively straightforward and small-scale operation that can be accomplished for well under $20 million in net costs, if we use a market-based approach whereby we only dredge as much fill as we can sell or use at any given time. Once we dredge the reservoir we'll then want to periodically do some maintenance dredging to preserve its water storage capacity. We won't know more exact costs of dredging until we solicit bids from dredging companies, but let's just assume, for the sake of argument, a total net cost for this work of $22 million.

Earlier this year, the City commissioned a study to determine the cost and feasibility of renovating and expanding the existing Lower Ragged Mountain Dam. The resulting report offered up a preliminary cost range of $9.9 million-$13.1 million to fix the spillway and increase the reservoir by 13 feet. A "relatively small" additional outlay of funds would be required to shore up the base of the dam to allow an additional 29-foot increase if it were ever deemed necessary. For the sake of argument, let's assume a final price tag for this project of $14 million. A one-time capital project like this (as opposed to an ongoing operation like dredging) would be financed with 30-year bonds, so 30 years of interest payments on those bonds would bring its actual price tag closer to $28 million.

In summary: $22 million for dredging, $28 million for renovating and expanding the dam. Total approximate price tag of storage options allowed for in the City's plan: $50 million.

That sounds like a lot of money, and it is. But consider the alternative.

The original water supply plan, which some are arguing is still the preferred course, would have us build a massive new dam at Ragged Mountain. The new earthen dam would increase the size of that reservoir by 42 feet and result in the clear-cutting of up to 60,000 trees across 200 acres of biologically-rich forest; no dredging of the South Fork Rivanna Reservoir is envisioned in that plan. This new dam, including the I-64 embankment that it would necessitate, has been estimated to cost $40.771 million. We've already spent $2.92 million on engineering and design for this dam, leaving a remaining price tag of approximately $37.85 million. Adding in 30 years of interest payments would bring the new dam's actual remaining cost closer to $75 million.

To recap: $50 million for the City's newly-adopted plan vs. $75 million for the plan it replaces.

These are all approximate numbers, and further work is necessary to flesh out the various storage options and secure the proper regulatory permits. But you see my basic point. If we can save our citizens tens of millions of dollars and still provide 40+ years of water security for our region, while significantly reducing damage to our natural environment in the process, don't we owe it to our community to pursue such a course of action?


Anonymous said...

a straight forward; fiscally sound;
common sense approach to our
community's water planning.
maintenance dredging as a part
of any plan is understandable.
why is there such denial and resistance
to this idea?

SBS said...

YAY! Common sense prevailed! Thank you council members and Dave!

Anonymous said...

NKO - thank you and the City Councilors for your obvious study of the water issues and for your commitment to protecting the City resources while planning for future needs. Your leadership is very much appreciated.

Anonymous said...

These numbers for the county plan are still a significant understatement. The big dam is useless without the pipeline because Ragged Mountain can't fill without it.

It's not $75 million vs. $50 million. The Albemarle plan is really about $125-150 million (with financing costs).