Going up? Rates may rise to fund Riviera Beach water treatment plant

Riviera Beach city officials said at a Wednesday night meeting that water customers could see a possible rate increase from the Utilities Special District.

The Utility Special District, which has the same leadership as the city of Riviera Beach, has its own debt capacity separate from the city.

Randy Sherman, who is the finance director, said as of Wednesday there is no debt capacity for the water treatment plant.

"Do we have debt service capacity for this project? No, we do not," he said to council members Wednesday night.

Officials said the water treatment plant would cost up to $150 million in 2021. Then, in February, WFLX was told the plant would cost about $200 million. Riviera Beach council members, who also serve on the board for the Utility Special District, said Wednesday night the plant would now cost about $300 million.

Council Member Shirley Lanier said she was confused as to why the price for the water treatment plant is worth $300 million when it was around $100 million before the pandemic.

"This is really taking me by surprise, especially the last meeting when I heard about $300 million," Lanier said. "We need to slow this down so I can figure out and be able to articulate where this money is and how it's going to be spent and why it's so much."

City Manager Jonathan Evans said the city is looking to pursue grants and other funding sources to help fund the project.

Sherman said he didn't know the amount that rates would increase from the project.

"How are those rates going to be structured? I can't tell you at this point," he said. "It's all going to depend on what the cost is, what those costs we can offset … then we can set those rates."

Lanier said a possible rate increase is frustrating because water rates are already too high.

"Now, you're saying that in terms of how we bond it, that you may have to raise water rates to be able to fund it," she said. "They're already, No.1, high enough."

Mike Hoisington, who is the overall project manager for the Haskell and CDM Smith project, asked the council to make a decision on the design, specifically the structure and shape, at Wednesday night's meeting.

Elizabeth Lents, who is the design manager, introduced three different types of designs.

She said Option 1 is the base-level design and described it to council members on Wednesday as "cost-effective."

Lents said Option 2 is the design concept it is working on and has completed a 30% design package submitted to the city. She said it's 40% more expensive than the baseline option because it has a larger volume in height and uses more glass.

Lents said Option 3 is the most expensive. She also asked council members to decide on the design, specifically the structure and shape, at Wednesday night's meeting.

Council Member Douglas Lawson said he wasn't comfortable voting on the options without a baseline cost.

"I can't give you an expected option," he said. "Forty percent of what? 100% of what? Because I don't even know what the baseline is if you're telling us you are doing a baseline for construction.

Lanier gave a similar critique.

"If I was building a house, I would give you a price for the roof, for the door," she asked. "I don't understand that."

Mike Hoisington, who is the overall project manager for the Haskell and CDM Smith project, said he wasn't given the baseline cost associated with these percentages.

Riviera Beach Utility Director Michael Low implored the council to pick a design so people can move forward with gathering the correct costs.

"The fact that we, A, get to a design," Low said. "B, eliminate those things that we don't need or find a cheaper way of doing something. Three, we get a clear idea on what the cost is going to be."

Lawson said it's difficult to get support from state and federal partners without a cost.

Suzanne Mechler, who is also on the team for Haskell and CDM Smith, said it expects to get a guaranteed maximum price in late fall.

Hoisington said the project is taking more than three years because it had lengthy contract negotiations with the city of Riviera Beach.

Hoisington said the group is now 14 months into the design process after it was awarded the project in 2023. Suzanne Mechler, who is also on the team, said it expects to get a guaranteed maximum price in late fall.

It plans to create a new water treatment plant on Avenue L and W Blue Heron Boulevard and it also plans on improving a utility plant on Avenue U and Dr. Martin Luther King Jr. Boulevard with a maintenance shop and two groundwater supply wells among other improvements.

The companies said it obtained the state permit to demolish fuel stations at Avenue L. It said it's still waiting to get approval from the city of Riviera Beach for three different permits and hasn’t completed permits for the site plans for both locations.

Haskell and CDM Smith said it's still working on completing the design for both locations. It expects to reach partial completion thresholds in June and August.

It said the first step is the demolition of fuel tanks at the plant location at Avenue L. The companies said the city will stop using those tanks on April 30 and then it will do an environmental study.

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