Sewer rates set to spike if massive RI tunnel project gets OK

Cost of Narragansett Bay Commission's CSO project has jumped from $389M to $1.4B

PROVIDENCE, R.I. (WPRI) – State officials plan to make a decision next month on whether to approve the third and final phase of one of the largest infrastructure projects in Rhode Island’s history – and the major hike in sewer rates required to pay for it.

R.I. Department of Environmental Management spokeswoman Gail Mastrati said the agency expects to decide in January on whether to green-light Phase III of the Combined Sewer Overflow (CSO) Abatement project, a massive and long-running effort to curtail the amount of untreated sewage and other pollution flowing into the state’s waterways after storms.

The Narragansett Bay Commission (NBC), the quasi-public agency responsible for wastewater treatment in northern parts of the state, has asked DEM to approve a revised version of Phase III that would cost $815 million through 2038. Phase III had been slated to be done by 2025 – at a cost of $750 million – but in June the commission issued a report recommending the timeline be extended 13 years to spread out the financial burden on ratepayers.

“DEM is reviewing the report to ensure it complies with state and federal requirements and will advise NBC if we have any questions or if any changes are needed in order to proceed,” Mastrati said in an email.

If Phase III wins approval from DEM, that would bring the total cost of the CSO project to an eye-popping $1.415 billion – more than triple the initial estimate of $389 million put forward back in 1999, when the agency and DEM finalized their three-phase plan to bring Rhode Island in line with the federal Clean Water Act.

NBC spokeswoman Jamie Samons emphasized that the CSO project is providing “many benefits” for the state by improving water quality. Those include “a more vigorous shellfishing industry, greater access to bathing beaches, and a bay that provides robust opportunities for recreation, tourism, and economic growth,” she said.

Samons added: “Already we see, as a result of Phases I and II, that shellfishing acre days are growing and bathing beach closures are decreasing; a bathing beach as far up bay as Sabin Point will likely reopen due to improved water quality and it’s not unreasonable to think that others will follow.”

However, the roughly 370,000 Rhode Island residents and businesses served by NBC have also seen the impact of the CSO project in their sewer bills.

Back in 1996, the NBC’s average annual residential sewer bill was $130; it is now about $470, and projected to hit $670 by 2020 and $767 by 2031 if DEM approves the revised Phase III project. User fees account for nearly all of NBC’s revenue and totaled $92 million in 2014-15, up from $56 million in 2005-06.

The rising sewer rates have mirrored the growth in the commission’s borrowing, much of it to fund the CSO project. NBC’s outstanding debt ballooned from $364 million in 2005-06 to $609 million as of June 30 this year, according to its latest audit.

The affordability of the sewer rates required for Phase III is part of what led NBC to propose the longer timeline for the project, and is also part of what DEM is now examining. While NBC has acknowledged the proposed rates would breach its affordability target, the commissioners rejected a lower-cost alternative for Phase III out of concern it would not lead to enough improvement in water quality.

Not doing Phase III at all is an impossibility if Rhode Island wants to stay compliant with the Clean Water Act, according to Samons. “It is highly unlikely, even in the light of the excellent water quality results that we have achieved as a result of Phases I and II, that Phase III will be cancelled,” she said. But NBC’s board members have said Phase III should continue to be reassessed as it progresses to keep an eye on costs.

Phase I of the CSO project was completed in 2008, at a final cost of $365 million. Phase II is expected to be completed this year, at a final cost of $235 million.

If Phase III is approved as envisioned by NBC, it would be completed in four parts over roughly the next two decades.

The first and largest part of Phase III would be construction of a deep-rock storage tunnel in Pawtucket to control sewage overflow on the Seekonk and Blackstone rivers. It would be buried 150 to 200 feet below ground and stretch from just north of the Bucklin Point wastewater treatment plant in East Providence to the Pawtucket/Central Falls border.

The Pawtucket tunnel’s design would be completed by 2018, with construction to start the following year. Its expected total cost, along with related projects to be done in the first part of Phase III, is $588 million.

While Phase III of the CSO Project is by far the largest infrastructure project the Narragansett Bay Commission is planning between now and 2021, it is not the only one. The commission’s current plan calls for $189 million in capital spending through 2021, two-thirds of it for Phase III and the rest for other projects.

More than 71% of the Narragansett Bay Commission’s accounts are in three communities: Providence, Pawtucket and North Providence. Its service area also covers North Providence, Johnston, Central Falls, Cumberland, Lincoln, the northern portion of East Providence and small sections of Cranston and Smithfield.

Revised CSO Phase III plan

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He hosts Executive Suite and writes The Saturday Morning Post. Follow him on Twitter: @tednesi

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