NC0025381_Subaqueous Sanitary Sewer Replacement Project update_20240620

Town of
est. 192ZNorih a ri t
June 20, 2024
NC Department of Environmental Quality
Landon Davidson, Secretary's Office
Daniel Boss, DWR ARO
Lauren Armeni, DWR ARO
Mikal Wilmer, DWI ARO
Logan Kluttz, DWI ARO
Julia Byrd, DWI ARO
RE: Town of Lake Lure Subaqueous Sanitary Sewer Replacement Project
*** via email only ***
Ladies & Gentlemen —
We are writing to provide a status update regarding the Town of Lake Lure's Subaqueous Sanitary Sewer
(SASS) Replacement Project. Following your review of the information presented below, LaBella and the
Town would appreciate the opportunity to meet with representatives of NCDEQ including both the
Division of Water Resources (DWR) and the Division of Water Infrastructure (DWI) at your convenience.
Short -Term Proeress
As you may already know, NC DEQ Dam Safety has required that the Town install a Drain Valve in the
base of the 100-year old 100-foot high dam, which can be used to lower the Lake level on an emergency
basis in the event of a threat to the dam's structural integrity. Without this Valve, the Lake can only be
lowered approximately twelve feet. The proposed SASS Replacement approach (i.e., the 'Gravity -Lift
Stations' or'GLS' System) has been designed to take advantage of the new Valve and construct new
Sanitary Sewers in the backshore at elevations as low as twenty feet below the Lake's normal pool
elevation.
Unfortunately, the installation of the Drain Valve has taken substantially longer than originally
anticipated. The ER-EID submitted in 2020 and approved by DWI in 2021 foresaw the Valve's installation
being complete before the start of the 2022 Lake drawdown cycle (October 2022). Today, the Valve is
on -track for completion by the end of 2024, but the complexity of the installation process creates
hesitation to guarantee even this date.
The Town entered into a Design -Build contract with Ruby -Collins for completion of the SASS
Replacement Project, and Ruby -Collins performed some preliminary work during the 2022-23 drawdown
in the Sunset Cove area of the Lake where the GLS design calls for sewer installation above the elevation
of the dam's spillway. Subsequent work in the same area was scheduled for the 2023-24 drawdown but
the Valve installation work necessitated varying the Lake's levels such that it impeded Ruby -Collins'
planned work, and further effort this past season was consequently abandoned.

Without a definitive schedule for Valve completion, the Town believes it would be inadvisable to plan for
more GLS work to be performed during the potential 2024-25 drawdown. A contractor cannot be 'on
standby' in case the Lake levels are able to be lowered without incurring substantial standby costs.
Therefore, the Town plans to begin GLS installation in earnest during the 2025-26 drawdown, when Lake
levels will most definitely be able to be drawn down twenty feet.
This plan will further allow data collection to be performed, which is beneficial to the GLS Project:
• The new Valve will be able to be tested. In particular, the ability of the Valve to be modulated to
maintain a relatively steady Lake level during varying weather conditions will be important to the
progress of the GLS work once begun.
• While the backshore between twelve and twenty feet below normal pool has been
hydrographically surveyed, it has not been exposed to view for nearly 100 years. With the
newly -obtained ability to lower the Lake below the dam spillway, we anticipate substantial
investigative effort on the newly -exposed backshore.
Lone -Term Outlook
The construction industry is painfully aware of the inflation that has occurred over the past four years,
and construction cost increases have well outpaced commonly reported inflation values such as the
Consumer Price Index (CPI). Estimates of Project cost included in the ER-EID were made prior to these
increases, and so a 'revisit' was performed by LaBella in March and April of this year. In addition, the
work Ruby -Collins has already performed has provided for an estimating process informed of the
constructability challenges of heavy civil construction in the backshore.
The summary results of the revisit are illustrated below, comparing the ER-EID stated costs to those
currently anticipated for the full (entire Lake) Project completion. A complete Feasibility Revisit fact
sheet containing this illustration was provided to Lake Lure's Town Council in April, and it is attached.
Feasibility Revisit
NPV Cost Comparisons Own to now
Capital
.LPS N •O
BPS
GLS
$0 $20 $40 $60 $80 $100 $120 $140
Millions
GLS = Gravity / Lift Stations BPS = Backshore Pump Stations BLPS = Backshore Low Pressure Sewer LBLPS = Lond•Bosed Low Pressure Sewer

|n2020, the Town anticipated edaunting, but conceivably feasible total Project cost of over $57million
for the GLSsystem. A$l2.Smillion combination ofSRFand grant fundswesviewedas'seedmone'/to
get started, with anticipation ofsub�uentodd�na|funds bridging the gap. Since the�the To�' has
obtained $8miU\oninARPAgrant funds and another $7mU�
||onin8RFan,bdndng1hecunznt--
|
available funding to $27.5 million. However, the gap has increased from $45 million to $75 million,,
leaving the Town recognizing that vvitsubstantial funds, itmay never be financially
feasible for the Town tocomplete the Project.Steps Forward
The fact sheet lays out reasoning that leads the Town to conclude that the GLS remains the most
advantageous option. However, we anticipate thatsomeanaasaroundtheLake—partioo|ar|ythose
where existing development is sparse — will be more cost-effectively served by other options such as a
Land -Based Low -Pressure Sewer (L8LP5) System. (In such cases the cost ofL `3 installations and
perpetual operation on individual parcels would be borne by new development when homes are built,
effectively transferring a substantial portion of costs to the new development itself.) Using avariable
approach in this way, depending on the particular characteristics of the area being served,vveexpect
that the total Project cost and the gap will bedecreased, albeit marginally |ncomparison tothe
challenge.
The Town is also moving into an aggressive effort to reach out to agencies and legislators to advocate for
additional funding. The attached 'flysheet' is being used to communicate the situation and need.
The Town of Lake Lure appreciates your consideration for our concerns and we look forward to working
with you to create a feasible solution to eliminate the issues surrounding our sewer system.
Olivia Stewman
Town Manager
Cc Mike Ovdu|a,Project Manager
Dean Lindsey, Public Services Director

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History: Lake Lure was envisioned as a resort community in the 1920s by a developer. The
Lake was completed in 1927, but the business venture failed two years later due to the
Great Depression. The resort design incorporated a sewer collection system under up to
100 feet of water at the bottom of the Lake, which discharged to the Broad River below
the dam (photo below). The significant lake water that leaks into the sewers is problematic
now that the Clean Water Act requires treatment before discharge. The Town's
Wastewater Treatment Plant (WWTP) cannot treat such diluted wastewater to permit
limits, and the Town is under a Special Order by Consent (SOC) from NCDEQ to come into
compliance. The Town must replace the ENTIRE 100-year-old inherited SASS system.
Problem: There is no inexpensive solution. An
entirely new sewer system must be built around
Lake Lure. A 'Gravity -Lift Stations' design was
conceived in 2020 and approved by NCDEQ as the
option with the lowest life -cycle cost, and work has
begun. $20M of SRF loans and $81VI of ARPA
funding has been allocated, but construction
complexity and inflation since then has increased
the estimate from $58M to over $100M, beyond
the Town's reasonable ability to afford, given a
resident population of less than 1600 and an
existing sewer customer base of only 660
connections. The Town already has some of the highest sewer rates in North Carolina and
is also facing concurrent needs of a $100M Dam replacement and a $35M WWTP
replacement. It is obvious that without an extraordinary level of grant funding, the SASS
replacement project will not be able to be completed, putting this community in peril.
Replacement Options
NPV Cost Comparisons to now
$0m $30m $60m $90m $120m $150m
LLPS Funded
■ Capital
BLPS 0 ROM
■ Easements
BPS
G LS
GLS = Gravity -Lift Stations; BPS = Backshore Pump Stations;
BLPS = Backshore Low -Pressure Sewer; LLPS = Land -based Low -Pressure Sewer
Benefits: Lake Lure is a historic and scenic
gem of North Carolina, a backdrop to
Chimney Rock State Park, and a vibrant
tourist destination. The SASS replacement
will return the WWTP discharge to permit
compliance and enable the Town to
continue protecting the environment, the
Lake Lure community and the local
economy, which is driven by the annual
influx of more than 300,000 North Carolina
visitors.