TRAVERSE CITY — City residents face paying an additional $234,000 each year to retire debt on their jointly owned sewage treatment plant — if city officials can’t work out a deal with their partner townships.
The city owns 60 percent of the plant and the townships of Acme, Peninsula, East Bay, Garfield, and Elmwood in Leelanau County own 40 percent. Since 2003 the townships leased 10 percent capacity from the city at a cost of about $234,000 a year. City officials want to extend the lease at that same 10 percent, while township representatives prefer to trim their share.
Several years of discussions haven’t resolved the issue.
“It’s a complicated issue and everyone is doing their best to represent their own constituents,” City Manager Ben Bifoss said.
Bifoss, who retires June 28, wants the Traverse City commission to adopt a policy that it will lease 10 percent — and nothing less — to provide guidance to his successor. The city commission will discuss the proposed policy when it meets today at 7 p.m. in the Governmental Center.
The city and townships already divide operational costs based on how much sewage each unit sends to the plant. Generally the city generates about half the sewage flow and the townships combined account for the other half. Bifoss said it’s fair to split the cost of debt and new equipment the same way.
The townships’ lease is divided into two contracts. One for 2 percent expired in 2009. The townships stopped paying on that in 2012 because they don’t need it, said Glen Lile, East Bay Township supervisor. The remaining contract for 8 percent expires in 2014.
“If the city assumes the full 10 percent, people in the city will see their sewer bills jump way up,” Lile said.
Generally, both the city and townships use only half of the plant’s capacity, but during peak summer days some townships exceed the capacity they own and rely on the leased capacity.
Loss of that leased capacity would allow the city to block any new or expanded hookups to sewer systems in a township that repeatedly exceeded its capacity.
Lile said he’s not convinced East Bay needs more capacity, but he wants to make sure it’s available if and when new housing and commercial growth takes root.
“Hopefully this thing can be resolved by something that’s mutually agreeable,” he said