KS Board delays decision on manhole project as questions loom over costs, lagoon repairs, possible system sale

The Kingston Springs Board of Commissioners delayed action Thursday, Nov. 20 on its wastewater manhole rehabilitation project after an hour of discussion over grant funding, rising repair costs and the possibility of selling the town’s sewer system. A vote is now scheduled for Friday, Dec. 5, when commissioners will also receive bid results for major repairs to the town’s wastewater lagoon.

The manhole project — bid for the third time after two failed attempts — drew three qualifying contractors, with CTR Coatings submitting the lowest total bid at $834,478. The proposal includes a base package and six alternates, allowing the town to scale the project from a minimum of roughly 40 manholes to as many as 104, depending on how much money the board is willing to commit.

Before commissioners weighed the bid options, Town Manager John Lawless outlined how much money the town currently has available for the project:

• The town received $701,132.10 in grant funds for sewer-related improvements from the Tennessee Department of Environment and Conservation (TDEC).
• After previous spending on GIS mapping, SCADA system upgrades, and manhole inspections, $409,762.10 remains earmarked for manhole rehabilitation.
• The town must contribute a 20% match, estimated at $140,226.
• About $113,934.02 from federal ARP funds is already set aside for the match. An additional $26,292.40 would be required.
• In total, the town has $549,985.52 in grants and matching dollars available — effectively establishing a “floor” for the project cost.

Any amount above that — up to the full $834,478 bid — would come from a loan or the sewer system’s depreciation fund, which currently holds just under $500,000.

A choice between partial repairs or draining the depreciation fund

City Engineer Peter Chimera told the board the bid pricing for the manhole rehab project was “very competitive” and significantly lower than the town’s earlier estimate of $1.1 million. Chimera recommended accepting the full bid, saying, “It's cheaper today than it ever will be,” and arguing the town should do as much work now as possible.

But commissioners hesitated. Fully funding the project would require getting a loan or withdrawing more than $300,000 from the sewer's depreciation fund — leaving roughly $200,000 for emergencies at a time when the system faces additional expensive mandates.

The lagoon decision still unknown

On Dec. 4, the town will open bids for repairs or replacement of the lagoon’s failing liner — work required under a TDEC director’s order and due by Aug. 31. Chimera said bids will include three options: repairing the existing liner, replacing it entirely or abandoning liners in favor of a clay-bottom lagoon.

Clay performs better and lasts longer, Chimera said, but could cost significantly more. Plastic liners may be cheaper but typically last around 25 years.

Commissioners agreed they cannot make a final decision on the manhole project until lagoon bids are known, since the town is expected to borrow money — possibly upwards of a million — for the lagoon regardless of the option selected.

Potential sale to CSWR adds new uncertainty

Several commissioners again raised the pending offer from Central States Water Resources (CSWR), which recently submitted an RFP to purchase the town’s sewer system. The town has not formally opened negotiations, and officials cautioned that key details — including the buyer’s willingness to take on existing infrastructure in various states of repair — have not been discussed.

One figure was repeatedly cited: a potential $2.7 million purchase price. Commissioners acknowledged that number is not firm, but it shaped discussion around whether investing heavily in manhole rehabilitation would benefit the town or merely increase debt that CSWR would need to address in a sale.

Engineer Chimera noted that debt cannot be transferred; the town would have to pay off any loans using sale proceeds. “Being more in debt simplifies the sale,” he said, if the goal is to transfer the system as close to net-zero value as possible. But between now and a potential 18-month closing period, ratepayers could see temporary rate increases of $12 per month per $1 million borrowed.

Wastewater Board will reconvene Dec. 5

With the manhole bids expiring 60 days after opening, commissioners agreed to reconvene on Friday, Dec. 5 at 7:15 p.m. to evaluate the lagoon bids and decide whether to accept all, part or none of the manhole work.

“We're up against the wall here," Commissioner Keith Allgood said. "Handing over a system at close to net zero is what I definitely think would be best."