SECHELT — A controversial $25-million sewage treatment plant in Sechelt will have to be expanded as early as 2023 at a cost of $13 million, according to a project review by Deloitte LLP.
The Sechelt Water Resource Centre was designed to be a showcase for sustainability and innovation, processing the town’s sewage to a world-class standard and producing Class A compostable biosolids as a byproduct.
And while the two-year-old facility has won six industry awards for design excellence and environmental values, it has also been dogged by criticism for a lack of transparency, financial waste and conflict of interest.
The District of Sechelt had initially budgeted $4.8 million for a biosolids processing facility and $10.2 million for a treatment plant. However, the contract awarded for the combined project exceeded $21 million and later increased to $25 million.
The Deloitte review — commissioned by the district — found no evidence that the district took steps to establish the true market price of the project.
A loan of $7.4 million was required to fully fund the construction.
The district is also saddled with higher-than-anticipated operating costs.
In 2015, the plant cost $1.13 million to operate, about 65 per cent higher than the operating costs of the two facilities it replaced.
Operating costs are projected to rise to $1.6 million per year by 2021, while principal payments and interest costs on the loan total $870,000 per year.
“The debt servicing is not a problem, we are in good shape there,” Mayor Bruce Milne said.
“But the higher operating costs are something we will have to absorb at a time when we are struggling with increasing [property] tax rates.”
Now, it appears that the capacity of the plant is far short of that needed for a growing community.
The 4,000 cubic-metre-per-day capacity will be met by 2023, according to the report. The existing site has space to expand, but a larger plant would also require a $3-million ocean outfall upgrade by 2026.
The total cost of the plant expansion and outfall upgrade would be roughly $16.5 million, according to the report.
The plant’s life cycle and operating costs were left “murky” during the planning of the project, Milne said.
“We really have to put our house in order financially,” he said. “That just wasn’t done before this project — and it should have been.”
Last October, council embarked on a liquid-waste management plan and a financial-sustainability plan to create a long-term roadmap for the district’s growth.
“We are looking at a three per cent increase in property tax every year for the next few years, just for infra-structure,” Milne said.
A change in the preferred siting of the project — from an industrial area to downtown Sechelt near Ebbtide Street — raised hackles in the community, including accusations of conflict stemming from allegations that then-mayor John Henderson wanted the plant located farther from his home.
According to the report, the project steering committee had identified the industrial location, purchased by the District of Sechelt for the “sole purpose” of building the wastewater facility, as the preferred site. This was endorsed by council and supported by the project’s technical consultant.
The project steering committee later reversed its position, however, declaring both sites acceptable.
The downtown location was chosen when the district council settled on Maple Reinders as its preferred contractor. Maple Reinders had proposed building the facility at Ebbtide.
The review was not able to locate any public documentation of Ebbtide being a permissible treatment plant site until after the Maple Reinders proposal was selected.
“I don’t think the report addressed the issue of conflict in a way that will satisfy the community,” Milne said.
The report also notes:
• Dewatered solid waste is not being processed to Class A compost standards, contrary to project goals.
• The plant is using 13 per cent more power per unit of water treated than projected.
• The plant has not achieved potable re-use standards, contrary to project goals.
