Council approves 'monumental' biosolids plant

In what is likely to be its biggest single decision of the current term, city council approved a “monumental” plan Nov. 20 to build a $62-million plant to treat sewage in Greater Sudbury.

The plant will be built by a private Canadian company, N-Viro, which will operate the plant for 20 years, before turning it over to the city. Once treated, the class A biosolids produced at the plant should be safe and clean and suitable for fertilizer.

The plant has been in the works since 2008, when Vale and the province told city it could no longer dump sludge into Vale’s tailings pond in Lively. Residents in Ward 1 and 2 in the city also complained about odour from the pond.

Tony Cecutti, the city’s general manager of infrastructure, told councillors that N-Viro would build and operate plant for 20 years under a private-public sector partnership known as P3. The federal government, which has set up a corporation with a $1.2 billion fund to promote P3 agreements, is providing $11 million for the project, although the city hopes it will boost that amount to 25 per cent of the total project cost.

Cecutti said it became clear that costs would be much higher than preliminary estimates of $30 million-$40 million. That’s because of a few factors: technology required to build the plant cost more; odour control costs weren’t part of original estimate; and, the passage of time also increased costs.

After a lengthy and complex planning process led by a team of city staff, two formal bids to build the plant were received in October. Each bid was scored based on a ratings system based on technical, risk, financing and price considerations. Cecutti said both bids were technically strong, so price became a bigger factor. N-Viro scored 3,468 out of a possible 4,000 points and had the lowest price.

Under the agreement, the city would pay N-Viro an annual operating payment of $2.8 million, and would also pay 75 per cent of the cost of building the plant, but once it is built. Financing the city’s share of the debt will cost $6.2 million, but when other factors are included, that translates into $4 million a year on the municipal tax bill. The increase will be phased in between 2013 and 2015.

However, the city pays nothing until the plant is built and ready to begin operation. N-Viro also takes on all risk for design, build, costs and for meeting construction schedule, which requires the plant to be built within 24 months. If operating costs are higher, N-Viro would have to pay the difference.

Lorella Hayes, the city’s chief financial officers, told councillors that going with the P3 model will save the city $16 million over the 20-year lifespan of the contract with N-Viro.

About 20-30 people will be employed while the plant is being built, with three to five workers will be employed after it’s built. City will own biosolids plant at the end of the 20 years. Under terms of the deal, N-Viro must turn it over in good condition.

Ward 2 Coun. Jacques Barbeau praised staff efforts on the project, while lamenting the length of time it took to come together.

“We’re making a monumental decision this evening,” Barbeau said, adding he has heard odour complaints for a long time from people in his ward over the smell coming from the tailings pond. “We say this has taken so long, although I guess relative to Maley Drive (extension), this has moved at lightning speed.”

Ward 10 Coun. Fran Caldarelli asked what can be done with class A biosolid.

“What will they do with it?” Caldarelli asked. “Is there any financial market for it?”

Cecutti replied that N-Viro owned the product until end of 20-year contract.

“So it would be up to them to find a suitable location for it,” he said. “We’re satisfied they have demonstrated the ability to find suitable locations for it. But certainly, the product is suitable for your garden, for your lawn.”

Not everyone was on board for the P3 model, however. Ward 3 Coun. Claude Berthiaume said he has been against the plan from the beginning.

“This could have been done in a different way,” Berthiaume said. “We still could have gotten the money. I don’t think it was necessary for the federal government to push the P3 plan on municipalities.

“Frankly, this is Conservative ideology they’re pushing on municipalities. I think we would have built this ourselves and maintained it using our own employees.”

In the end, however, Berthiaume was the only councillor to vote against the plan.