Sewer Construction Estimates
The latest Opinion of Probable Construction Cost (prepared in May 2024) estimates the sewer project will cost between $4.6-$6.5 Million.
Assuming a $6 Million Project Cost, a $3 Million CWSRF loan at 1.57%, $3 Million in grant funding, and annual operating expenses of around $100,000 per year, SDC fees are estimated to be roughly $7,500/EDU and monthly rates are projected to be as follows, based on the number of Equivalent Dwelling Units (EDUs) connected to the system.
We will use these numbers they have given to do a quick budget!
In its simplest form, any budget can be broken down to three numbers so let’s try that out.
| #1 Income | #2 Operating Expenses | #3 Debt Expense | Net Income |
| $163,200 | $100,000 | 165,194 | – $101,994 |
Let’s explain each of these numbers:
#1 Income
This is based on 160 EDUs paying $85 per month for 12 months.
The math is 160 (EDUs) x $85 x 12 months = $163,200
(Bare in mind there is no guarantee that they will have 160 EDUs. Our investigation shows they will have about 100.)
#2 Operating Expenses
They give us an estimate of $100,000 on this number so we will go with that. (We believe this number will be MUCH more.)
3# Debt Expenses
We are going to assume that the district will get the $3,000,000 in grants but that is not assured at this point. That will leave two loans to be paid back. The loan rate, according to the DEQ website, is 1.55%+.5% for a total of 2.05%… NOT 1.57%. One loan to DEQ of $6,000,000 minus $3,000,000 in grants and minus $1,200,000 in collected SDC fees leaving $1,800,000 will cost $89,736 per year (30 year loan). The other loan from Redmond Sewer for $1,200,000 will cost $75,808 per year (20 year loan).
$84,045 + $81,605 = $165,194*
Net Income
At this point we show net income of -$101,994 in the first year … .that is if they have 160 EDUs … .if they get the requested grants, if the project cost is no more than $6,000,000 and if operating expenses are no more than $100,000. And these are their numbers they are trying to tell you will WORK! It’s very simple! Tell us where our math is wrong. Only three numbers needed to tell the story.
We would also like to note several numbers the district is now giving us that have changed from their original projection:
– First and foremost their original projection for monthly fees was $68…it has now changed to $85.
– Second are the SDC fees charged to each person connecting to the sewer. The original projection was $6,480…it has now changed to $7,500.
– Third is the total cost of the project. The original projection said it would cost $3,830,320 now it has ballooned to $6,000,000.
Do you believe the same people that can not do math involving just three numbers can run this district? We here at Terrebonne Sewer District have grave concerns.
*We understand that our numbers noted for debt expenses are approximate numbers based on an amortization schedule and may vary slightly from actual debt expenses. This number will decrease every year and after 10 years will be about $160,576.
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