$100 million? Olympia leaders aghast at price tag for new Public Works buildings
AI-generated summary reviewed by our newsroom.
- City plans two new Public Works facilities; Eastside site at end of life.
- First phase on Carpenter Road costs over $40M; total project nears $100M.
- Debt plan would add $3M annually, implying about a 24% waste rate hike.
The city of Olympia is in need of not one, but two new maintenance facilities because the Public Works Department has outgrown its current space.
But the project might cost the city nearly $100 million, which would involve a debt plan and higher utility rates for residents who need their garbage and recycling hauled away.
The Olympia Finance Committee discussed March 16 whether the city and its residents could afford such a project, or if it’s worth contracting with a private garbage collector like every other jurisdiction in Thurston County.
Public Works Director Mark Russell said during the meeting that the current Public Works and Maintenance Center, located on Eastside Street Southeast right next to Interstate 5, is almost 50 years old. He said it was previously the transit maintenance facility, and it’s no longer efficient for the operations crews to work there.
“They’ve outgrown the space dramatically,” he said. “Major systems and building deficiencies exist. They’re at the end of their useful life.”
Russell said the property also has a number of challenging environmental conditions. Moxlie Creek runs along the west side of the property, and there are wetlands in the middle that separate the property, making for little usable space to build on.
And Russell said the current building doesn’t meet seismic requirements. He said if there’s an earthquake, it would affect their response greatly.
“We would be working 24 hours a day, and if that building collapsed or had some major damage during the earthquake, it would really hamper our response to the community,” he said.
Russell said the city hired a consultant in 2017 to come up with a plan for a larger building on the Eastside Street property. However, they weren’t able to come up with anything that met the needs of the department. They ran into environmental issues with the creek and wetlands, conflicts with adjacent land uses and a lack of interest from adjacent private property owners to sell their land to the city.
Russell said the consultant worked for years to come up with the most cost-effective solution: to relocate waste resources operations to a new facility on Carpenter Road, just outside the city of Lacey. It’s the former firing range for the Olympia Police Department and the Thurston County Sheriff’s Office, and is owned by the city of Olympia.
The site is near the intersection of Martin Way and Carpenter Road and is in Thurston County and Lacey’s Urban Growth Area, Russell said. And it’s much closer to the Waste and Recovery Center on Hogum Bay Road where trucks dump garbage and recycling.
He said this would be the first phase of the project. It would be followed by construction of a new maintenance center to support the rest of public works operations on the existing site on Eastside Street. He said because there would be less staff and less equipment there, it would allow them to use the space effectively with the remaining public works operations and maintenance needs.
New site
Russell said the city hired engineering firm KPFF in 2020 to develop a conceptual design and help prepare the Carpenter Road site for construction. It would house staff offices for approximately 40 public works staff, room for 20 collection vehicles and 7 support vehicles. Parking would be covered, and storage units for containers and bays for trucks would be included.
Russell said the department’s inventory is currently spread across three different sites, and they’d like to consolidate everything. He said they need 1.75 acres to store 4,700 carts, 36 drop boxes and 470 dumpsters, with room for trucks to move in and out with ease.
He said the city has 16,000 single-family residential waste customers. And multi-family households are another 10,000 customers.
The department has already used $2.6 million in waste resources utility capital funds to get a number of things done on the new site, Russell said. The old firing range on the property has been demolished, and the Department of Ecology has finished remediation. Miles Sand and Gravel is currently removing rock material under agreement with the City to help provide rough grading of the site.
Russell said the site should be shovel ready by the end of the year.
Russell said the first phase of the project is estimated to cost about $33.5 million, and that includes Carpenter Road site development, constructing the building, and equipment contained in the building.
With a 10% contingency for unforeseen costs, risks and changes, as well as fees for construction and other charges from the county and Lacey, the first phase of the project is estimated to cost over $40 million.
Russell said demolition and reconstruction of the Eastside building would cost another $50 million. He said the plan would be to finish the Carpenter Road site and move staff over to the new building. Once the Eastside building is reconstructed, Waste Resources would stay put, and the rest of Public Works would return to the Eastside location.
Russell said waste resources does not have $40 million just laying around. So they’ve worked with the city’s Finance Department to come up with a potential debt obligation package. For $40 million over 30 years, the city would pay $3 million a year.
He said if the city increased waste resources’ expenses by $3 million a year, that would equate to roughly a 24% rate increase on just the waste part of residents’ utility bills.
The yearly rate for a typical single-family, bi-monthly residential bill is $65.10. Rates would ultimately increase to about $81, which does not include the normal yearly inflationary rate.
Russell said the department has been setting utilities capital funds aside for years to nearly finish the design of the Carpenter Road facility. He said that would be the next step, if the city chooses to move forward with the funding plan.
He said the second phase of reconstructing the Public Works building in Olympia would cost the city between $3.5 million and $4 million if they pursue a similar funding plan. He said they may need to go in a different direction to raise funds for that phase of the project.
Altogether, he said it’s a $100 million endeavor.
No other option
Committee member Robert Vanderpool said it’s quite a shocking number, and he asked to have more time to review the details. He also wondered how other municipalities afford these expenses and how big of a space they have for their Public Works departments.
Russell said the problem is that most other places in the county don’t collect solid waste, but have privatized that work. Therefore, their Public Works departments are smaller. Lacey and the county likely wouldn’t be interested in sharing the costs of a facility if they’re not going to use it.
Russell said the city of Lacey has its own, newer maintenance center, and the city of Tumwater is working on a new Operations & Maintenance facility. He said there are about 29 cities in the state of Washington that provide municipal services like Olympia.
Committee member Kelly Green asked if there’s an Option B that the City Council could consider. She said she had heartburn thinking about the price and what it might actually be once construction begins.
Russell said there isn’t really another option, especially if the city doesn’t go private with its solid waste collection.
He said if they start design work now, it would take a couple of years to get everything ready to go for construction. And then construction would take another two years. It would be upwards of 4 years before the department could move out for the old building to be demolished and rebuilt.
Russell said the city hasn’t had a conversation about going private in the 20 years he’s worked in Public Works. He said Olympia has run its own waste collection service since 1937.
Green said she would be interested in the council hearing about privatization options and if there are any viable alternatives. She said she wants to understand the landscape better, where Olympia sits among other jurisdictions when it comes to rates and the systems in which they collect garbage and recycling.
Russell said they will be scheduling a study session with the City Council to discuss: What other cities are doing, and regarding privatization, what others in our area do and what their rates are. They also plan to discuss what types of controls these businesses have in place to maintain those rates, and meet future needs.
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