News for those who live, work and play in the Santiam Canyon

NSSA calculating possible rates for regional sewer

The North Santiam Sewer Authority (NSSA) is exploring potential service rates for a proposed regional sewer plant, with a report expected later this month.

The four participating cities – Mill City, Gates, Detroit and Idanha – have been asked to estimate the number of potential sewer customers, as well as possible population growth.

Seattle-based consultancy FCS Group will incorporate the data with projected operational costs for the sewer system, which is moving into the engineering stage of development.

Rate estimates are scheduled to be shared Nov. 20 during the regular meeting of the NSSA Board and will include potential costs for the first five years of operations.

FCS project manager Gordon Wilson told the board during its Oct. 16 meeting the numbers in the report will not be set in stone and will likely change as new information is gathered. He said the goal for the Nov. 20 report is to give the board information that will help them pursue policies to keep the system operating and affordable.

“It is really expensive at first for the early-end people and eventually over the long term it gets more economically feasible, but it does take doing,” said Wilson.

NSSA was formed in 2020 to oversee development and eventual operations of a regional sewer system connecting Mill City, Gates, Detroit and Idanha. Two stages are planned with an initial phase connecting Mill City and Gates by 2027 and a second phase adding Detroit and Idanha by 2028.

Marion County has acquired a $50 million grant for the first phase as well as commercial septic in Detroit to help offset a lack of sewer access. An additional $56 million is being sought to complete the second phase.

Wilson told the board Oct. 16 that rates will depend primarily on how many residents hook into the system early on, thereby spreading costs over a larger group.

“You want to make it as easy as possible for anybody to connect, because you need every single person if at all possible,” he said.

Wilson said one of the challenges will be convincing residents who are used to septic that they would benefit from connecting to a sewer system. Currently Mill City customers are on sewer, while Gates, Detroit and Idanha have septic or chemical toilets at their homes and businesses.

Wilson said adding a sewer bill to monthly expenses can be difficult for people who don’t already have one, and the benefit of increased property value is not felt until a property is sold.

He said there are a few strategies NSSA can employ to encourage early connections, such as waiving startup fees. He said the costs for line extensions, hookups and plumbing can reach $16,000 to $30,000 per connection, and said waiving these for early customers would be a strong incentive.

If NSSA chose this strategy, Wilson said financial projections would account for the fee waivers.

He also said early hookups are impacted by whether or not the board requires potential users to connect and how this mandate would be applied.

Wilson said the most lenient policy would be to mandate connections after septic fails for a user within reach of the sewer system, and said this is a common approach. Other options include mandating a connection upon the sale of a property or after a septic system reaches a certain age such as 15 years after installation. 

He said the harshest policy would be a flat mandate to connect when the system goes online.

Wilson said the board will have to strike a balance between lenient policies and securing as many early users as possible. He said a larger user base not only spreads out operational costs, but makes the project more appealing to grant providers who want to stretch their investment.

Wilson said grant funding will significantly impact rates because, if they need to take out loans on even 5 percent of the project, this could push up rates by around $100 per month. 

In addition to existing potential clients, the Nov. 20 report will account for connections from potential new developments. Wilson said a 2021 statewide growth study by Portland State University will be a starting point, and cities can add specific residential and business developments they know are under way.

Also included in these growth projections will be properties damaged by the 2020 Santiam Fire that are being rebuilt larger than the previous structures.

Wilson said the new system itself is likely to attract development, as public utilities allow for subdivisions and more complex businesses. He said it is normal to see an “initial surge” after a system is operational and this will be factored into estimates for customer rates.

Wilson told the board cities should not be too concerned about coming up with exact figures for new users and development growth, and should instead shoot for estimates that are “realistic.” He said the Nov. 20 presentation will include a range of potential rates reflecting possible outcomes.

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