2020 – Storm Water Preliminary Engineering Report

City of Conrad Conrad, MT

March 2020

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0 Executive Summary ...... 5 Introduction ...... 5 Existing Storm Water Facilities ...... 5 0.2.1 West Side Existing Storm Water System...... 6 0.2.2 East Side Storm Water Problems ...... 7 0.2.3 Storm Water Impacts on the Wastewater System ...... 7 Need for the Project ...... 8 Alternatives Considered ...... 9 Selection of an Alternative ...... 10 Proposed Project ...... 10 1 Project Planning ...... 11 Location ...... 11 Environmental Resources Present ...... 12 Population Trends ...... 12 Community Engagement ...... 13 2 Existing Facilities ...... 14 Location Map ...... 14 History ...... 14 Evaluation of West Side Existing Storm Water System...... 15 2.3.1 Description of Existing System ...... 15 2.3.2 Capacity and Condition Assessment ...... 18 2.3.3 Regulatory Assessment ...... 20 Evaluation of East Side Storm Water ...... 20 2.4.1 Description of Existing System ...... 20 2.4.2 Capacity and Condition Assessment ...... 21 Evaluation of Storm Water Impacts on the Wastewater System ...... 23 Financial Status of Existing Facilities ...... 24 Water/Energy/Waste Audits ...... 26 3 Need for Project ...... 27 Summary of Problems ...... 27 Health, Sanitation & Security ...... 28 Aging Infrastructure ...... 28

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System Operation and Maintenance ...... 28 Reasonable Growth...... 29 4 Alternatives Considered ...... 30 Alternative 1- No Action ...... 30 Alternative 2 – East Side Area Ditches to Convey Storm Water ...... 32 Alternative 3 – East Side Area Curb and Gutter and Storm Drain System ...... 33 Alternative 4 – East Side Area Storm Drain System No Curb and Gutter ...... 38 5 Selection of an Alternative ...... 42 Life Cycle Cost Analysis ...... 42 Non-Monetary Factors ...... 43 5.2.1 Public Health and Safety ...... 43 5.2.2 Public Acceptance ...... 44 5.2.3 Local Economic Affect ...... 44 5.2.4 Environmental Impacts ...... 44 5.2.5 Impacts to Existing Facilities ...... 44 5.2.6 Reliability ...... 44 5.2.7 Operational Ease ...... 44 Comparative Summary ...... 44 6 Proposed Project ...... 46 Preliminary Project Design ...... 48 Project Schedule ...... 49 Permit Requirements ...... 51 Sustainability Considerations ...... 51 Total Project Cost Estimate ...... 52 Annual Operating Budget ...... 53 6.6.1 Income...... 53 6.6.2 Annual O&M ...... 54 6.6.3 Debt Repayment...... 54 6.6.4 Reserves ...... 59 7 Conclusions and Recommendations ...... 60

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List of Appendices Appendix A – Environmental Information Appendix B – Correspondence with Affected Agencies Appendix C – Census Information Appendix D – Public Engagement Appendix E – DEQ, NOAA, and WWTP Information

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0 EXECUTIVE SUMMARY

Introduction The City of Conrad has an existing storm water system for the West Side of the City but the East Side, the lowest area of town, does not have a storm water system and experiences significant drainage problems even during the smallest storm events. Also, it has been determined that storm water is draining into the wastewater system. Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant (WWTP). The storm water in the wastewater system results in wasted energy, unnecessary wear and tear on the lift station and the WWTP, increased operations and maintenance requirements, and E Coli violations. According to DEQ Circular 2 – Design Standards for Public Sewage Systems, “Sewers must be designed for municipal wastewater only. Rainwater from roofs, streets, and other areas, and groundwater from foundation drains must not be permitted in municipal wastewater sewers.” The PER documents the study, conclusions, and recommendations for stormwater collection facilities for the City of Conrad, Montana. The PER identifies the planning area, evaluates the existing condition and operation of the existing facility, identifies existing problem areas within the system, and establishes a recommended course of action and design basis for storm water improvements to meet the needs of the City and the requirements of State and Federal regulations for a 20-year planning period. A summary of the project background, problems, recommended improvements, costs, and funding strategy are presented in the Executive Summary.

Existing Storm Water Facilities The planning area utilized for this study was developed based upon discussions with City of Conrad officials and review of the storm drainage areas that contribute to the runoff the City experiences.

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Figure 1 – Existing Facilities

0.2.1 West Side Existing Storm Water System The existing storm water system addresses drainage west of the railroad tracks and carries runoff both to the north and the south. The oldest section of the storm water system collects runoff from downtown Conrad and conveys it to the south to Pondera Coulee. The system in Main Street and Virginia Street includes numerous blocks of RCP, Vitrified Clay Pipe (VCP), and Asbestos Concrete (AC) pipe with inlets at the intersections The remainder of the system collects runoff from the west and north sides of town conveying it to the north to a natural drainage that connects with the Dry Fork of the Marias River near the

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City’s wastewater treatment plant. The system if made up of approximately 25,000 feet of various sizes of RCP with a few blocks of PVC and HDPE pipe. According to the City public works department the existing storm water inlets and pipes adequately address runoff in those areas serviced by the existing system. There are a few specific locations intertwined inside the are serviced by the existing storm water system that needs some improvements to prevent flooding of lower floor levels of buildings and puddling water leading to road deterioration. A summary of the problems with the existing infrastructure on the West Side of the railroad tracks is as follows:

1. Eight Ave South and the Alley west of Delaware Street (Horizon Lodge Retirement and Assisted Living Facility) drainage problems 2. Sixth Ave South and Iowa Street east side inlets and 8” collection pipes are too small and too shallow 3. Fifth Ave South and Iowa Street needs inlets at all four corners 4. Seventh Ave South and Delaware Street (north side) needs a valley gutter 5. Alley east of Main Street between Fourth and Fifth Ave South does not drain adequately resulting in flooded lower floors and basements specifically at City Hall 6. Front Street and Central Ave South needs inlets at all four corners 0.2.2 East Side Storm Water Problems The East Side of the railroad tracks was developed with paved streets but no ditches, no curb and gutter, and no storm water pipe. The area is generally sloped from the north to the south. There is limited storm drainage infrastructure in Solid Road along the north boundary of the East Side area that eventually drains to Pondera Coulee. The East Side area is plagued with storm water problems. Storm water runoff sits in the lower areas, at almost every intersection, and at several different areas along the streets. In some areas there is sitting water all year long that is up to 1’ deep. The sitting water becomes a stagnant breeding ground for disease carrying mosquitoes, causes roads to sluff into the low areas, and is a chronic road maintenance problem. City public works department is in this area pumping water across roadways and out of front yards. The residents of this area regularly complain about the sitting water often backing up to the foundations of their homes. 0.2.3 Storm Water Impacts on the Wastewater System It has been determined that storm water is draining into the wastewater system. Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant (WWTP). The storm water in the wastewater system results in wasted energy, unnecessary wear and tear on the lift station and the WWTP, increased operations and maintenance requirements, and E Coli violations. The excess storm water causes problems at the WWTP which utilizes a UV disinfection system to treat for E Coli. In April and June of 2018, during high runoff events, the WWTP exceeded the E Coli limits of the City’s wastewater discharge permit by 575% and 291% for the two April

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samples and by 83% for the June sample. E Coli violations of the wastewater discharge permit is a serious threat to public health and safety. In the figure below we compared the average precipitation over the last three years (precipitation information from NOAA) to the inflows experienced at the WWTP. The data indicates a correlation between precipitation events and the increased flows experienced at the WWTP. We also have indicated the 2018 E Coli violations. Figure 2 - Precipitation Compared to Wastewater Treatment Plant Influent

Need for the Project Following is a summary of the general storm water problems: • Storm water is entering the sanitary sewer system • Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant. • The storm water in the wastewater system results in wasted energy and unnecessary wear and tear on the lift station and the mechanical wastewater treatment plant. • Pumping and treating the storm water results in increased operations and maintenance to the system

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• According to DEQ Circular 2 – Design Standards for Public Sewage Systems, “Sewers must be designed for municipal wastewater only. Rainwater from roofs, streets, and other areas, and groundwater from foundation drains must not be permitted in municipal wastewater sewers.” • In April and June of 2018 during times of high runoff, the City exceeded the E Coli limits of the discharge permit resulting in violations which is a serious threat to public health and safety. A summary of the storm water problems west of the railroad tracks is as follows:

• Eighth Ave South and the Alley west of Delaware Street (Horizon Lodge Retirement and Assisted Living Facility). • Sixth Ave South and Iowa Street east side inlets and 8” collection pipes are too small and too shallow. • Fifth Ave South and Iowa Street needs inlets at all four corners. • Seventh Ave South and Delaware Street (north side) needs a valley gutter. • Alley east of Main Street between Fourth and Fifth Ave South does not drain adequately resulting in flooded lower floors and basements specifically at City Hall. • Front Street and Central Ave South needs inlets at all four corners A summary of the storm water problems east of the railroad tracks is as follows:

• The area was developed with paved streets but no ditches, no curb and gutter, and no storm water pipe. • Soils in the area are “Richey” silty clary loam type soils. • The area is very flat and doesn’t drain. • The runoff sits in the lower areas, at almost every intersection, and at several different areas along the streets. • In some areas there is sitting water all year long that is up to 1’ deep. The sitting water becomes a stagnant breeding ground for disease carrying mosquitoes, causes roads to sluff into the low areas, and is a chronic road maintenance problem. • The residents of this area regularly complain about the sitting water often backing up to the foundations of their homes.

Alternatives Considered Various alternatives were considered to address the problems with the system. The various alternatives that were considered are: • Alternative 1 -No Action • Alternative 2 – East Side Area Ditches to Convey Storm Water • Alternative 3 – East Side Area Curb and Gutter and Storm Drain System • Alternative 4 – East Side Area Storm Drain System No Curb and Gutter

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Selection of an Alternative The above-mentioned alternatives were considered to address the problems with Conrad’s storm water system. A screening analysis comparing capital costs and non-monetary factors was used to select the best alternative to correct the storm water problems. Capital costs included in the evaluation consist of administrative and construction costs, a 10% contingency, and 20% in engineering. The non-monetary factors considered in the selection of an alternative include public health and safety, public acceptance, local economic affect, environmental impacts, impacts to existing facilities, reliability, and operational ease.

Proposed Project The recommended preferred alternative is Alternative 4- East Side Area Storm Drain System No Curb and Gutter. The project would also include the following improvements to the West Side existing storm drain system.

1. Grading and Storm water inlet improvements at Eighth Ave South and the Alley west of Delaware Street (Horizon Lodge Retirement and Assisted Living Facility) 2. Storm water inlet and lateral improvements at Sixth Ave South and Fifth Ave South at Iowa Street 3. Gutter at Seventh Ave South and Delaware Street (north side) 4. Storm water extension in the Alley east of Main Street between Fourth and Fifth Ave South (City Hall) 5. Storm water inlets at Front Street and Central Ave South The total cost of the project is as follows: • Administrative- $229,000 • Preliminary Engineering - $30,000 • Engineering- $488,302 • Construction-$2,219,556 • Contingency-$221,956 • Total-$3,188,814 The funding strategy is as follows: • TSEP Grant–$500,000 • SRF Loan-$2,655,814 • Local Match-$33,000

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1 PROJECT PLANNING

L o c at i o n The planning area for this PER includes the City of Conrad and the areas outside of the City that contribute to and are affected by the storm water system. The City of Conrad is located in Pondera County on Interstate 15 and is approximately 63 miles northwest of Great Falls and 26 miles south of Shelby. Conrad is generally positioned in Township 28N, Range 3W, Section 23. The approximate latitude and longitude of the City is 48°10’30” N and 111°56’ 50” W, respectively. The north half of town drains to the north towards the Dry Fork of the Marias River which terminates at the Marias River approximately 15 miles north of town. The south half of town drains to the south towards Pondera Coulee. Pondera Coulee generally drains from west to the east terminating at the Marias River approximately 40 miles east of Conrad. An aerial photographic exhibit indicating the general location and layout of the City is included below. Figure 3 -Aerial Photo

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Environmental Resources Present state and federally funded projects are subject to either the Montana Environmental Policy Act (MEPA) or the National Environmental Policy Act of 1969 (NEPA), or both. MEPA seeks to avoid or mitigate adverse impacts on the natural and human environment by mandating careful consideration of the potential impacts of any development assisted with state funds or approved by a state agency. NEPA establishes national policy, goals, and procedures for protecting, restoring, and enhancing environmental quality. The Uniform Environmental Checklist was completed and can be found in Appendix A. In addition to the checklist the Environmental Review Form was prepared in accordance with Treasure State Endowment Program (TSEP) 2020 Construction Application Guidelines for the 2023 Biennium and is also included in Appendix A. Several federal and state agencies were contacted to identify any potential environmental impacts that might be associated with the proposed project. All correspondence with the affected agencies is included in Appendix B.

Population Trends The population trends of Conrad have varied over the years with declining population since 1990. On average since 1950 Conrad’s population has grown by about 0.68% per year or about 6.82% since 1950. According to the 2015 U.S. Census Bureau’s American Communities Survey (ACS) data the median household income in Conrad was $39,063 and 45.61% of the population was at low to moderate income level. The ACS information is included in Appendix C. Primary employment industries include farming and agriculture, education, retail trade, public administration, food, entertainment and construction services.

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Table 1 - Population Trends

Percent Year Population Percent Change per Year Change 1950 1,865 NA NA

1960 2,665 42.90% 4.29%

1970 2,770 3.94% 0.39%

1980 3,074 10.97% 1.10% US CENSUS 1990 2,891 -5.95% -0.60%

2000 2,753 -4.77% -0.48%

2010 2,583 -6.18% -0.62%

AVERAGE 6.82% 0.68%

2020 2,759 6.82% 0.68%

2030 2,947 6.82% 0.68%

PROJECTED 2040 3,148 6.82% 0.68%

Community Engagement The PER, the Environmental Review Form, and the Environmental Checklist were made available at City hall on ?????????? for public review and comment. Between ????? and April 7th, 2020, the public was given the opportunity to ask questions and provide written comments. Notice was given that the documents were available for comment in the formal advertisements for the April 7th, 2020 public hearing. At the public hearing the Town accepted the findings of the environmental evaluations and agreed that additional environmental review was not necessary. The affidavit of publications, the exhibits presented, and the meeting minutes have been included in Appendix D.

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2 EXISTING FACILITIES

Location Map A schematic layout of the storm water system is included in the following figure. Figure 4 -System Schematic

Hi s t o ry The community came into existence in 1903 and served as a station on the Great Northern Railroad branch line that ran from Great Falls to Shelby and then up to the Canadian border. The City of Conrad has invested significantly over the years into the street and storm water system. The earliest storm water system documents are from 1965 and indicate the improvements included approximately twenty blocks of 12”, 15”, 18”, 21”, and 27” reinforced concrete pipe (RCP) in the west and northern area of town. All existing storm water infrastructure is located west of the railroad tracks. The plans also indicate connection to an existing storm water system

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near the intersection of Second Avenue North and Main Street indicating a system was in place prior to the available storm water documents from 1965. The existing system (installed prior to 1965) included the storm water infrastructure that drains the entire downtown area with half going to the north and half to the south. There was a half block of 12” RCP storm water pipe installed in 1974 in Wisconsin Street between First Avenue North and Second Avenue North. In 1976 the Montana Department of Highways rebuilt Fourth Avenue South extending from Virginia Street out of town to the west. The project included several blocks of new 18” RCPA storm water improvements on the West Side of town. In 1978 and 1981 the City implemented street and storm water improvements on most of the streets west of the railroad tracks financed with SID No. 63, 64, and 66. The project included new curb and gutter, valley gutter, and pavement for most of the streets in this area and some new storm water inlets in Iowa Street, and a block of new 24” RCP along the south end of Virginia Street. In 1984 the City installed a block of 15” PVC storm water pipe north of the Idaho Street and First Avenue North intersection. Again in 1998 the City implemented street and storm water improvements on most of the streets west of the railroad tracks financed with SID No. 68 and 70. The project included sections of new curb and gutter, valley gutter, and pavement for most of the streets in this area. In 2000 a small section of 15” PVC storm water pipe was installed in Front Street to service the post office. The East Side of the railroad tracks was developed with paved streets but no ditches, no curb and gutter, and no storm water pipe.

Evaluation of West Side Existing Storm Water System 2.3.1 Description of Existing System The existing storm water system addresses drainage west of the railroad tracks and carries runoff both to the north and the south. The oldest section of the storm water system collects runoff from downtown Conrad and conveys it to the south to Pondera Coulee. The system daylights at the coulee on either side of the Main Street crossing. The system in Main Street and Virginia Street includes numerous blocks of RCP, Vitrified Clay Pipe (VCP), and Asbestos Concrete (AC) pipe with inlets at the intersections. The following exhibit includes the south section of the existing storm water system.

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Figure 5 – Existing South Storm Water System

The remainder of the system collects runoff from the west and north sides of town conveying it to the north to a natural drainage that connects with the Dry Fork of the Marias River near the City’s wastewater treatment plant. The system daylights at the natural drainage along HWY 191

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near the City Shop. The system includes many blocks of RCP with a few blocks of PVC and HDPE pipe. The following exhibit includes the west and north section of the existing storm water system. Figure 6 – Existing West and North Storm Water System

The City currently cleans and inspects the existing storm drainage pipes and inlets in the spring and fall and intermediately as needed. The City has a vacuum truck they utilize for keeping the system operational. The system if made up of approximately 25,000 feet of various sizes of storm water pipe. The following table summarizes the storm water pipe that makes up the system.

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Table 2 – Existing Storm Water Pipe

Size (in) Pipe Type Quantity (ft) 12 VCP 503 12 PVC 1,536 12 RCP 5,411 15 RCP 1,609 18 VCP 1,521 18 RCP 4,417 21 RCP 1,879 24 RCP 1,235 27 RCP 2,535 36 RCP 3,812 36 HPDE 1,060 Total 25,518

2.3.2 Capacity and Condition Assessment According to the City public works department the existing storm water inlets and pipes adequately address runoff in those areas serviced by the existing system. There are a few specific locations intertwined inside the are serviced by the existing storm water system that needs some improvements to prevent flooding of lower floor levels of buildings and puddling water leading to road deterioration. One of those specific locations is the intersection of Eight Ave South and the Alley west of Delaware Street. Runoff is collected in a ditch along the south side of Eighth Avenue that drains to a small inlet and 8” PVC pipe that daylights to the south. The drainage system in this area does not function properly leading to wet muddy road conditions and a poor street surface. The alley serves as one of two main entrances to the Horizon Lodge Retirement and Assisted Living Facility. The intersection of Sixth Ave South and Iowa Street is also a problematic area. The East Side inlets and 8” collection pipes are too small and too shallow. They don’t have adequate capacity, slope, or bury depth to function properly. Water puddles in this area causing problems with the street surface.

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Figure 7 – Intersection of Sixth Ave South and Iowa Street

The intersection of Fifth Ave South and Iowa Street also needs inlets at all four corners. There is an existing 12” RCP storm water pipe in Iowa Street with adequate capacity to handle the small amount of runoff expected at this intersection. The north side of the intersection of Seventh Ave South and Delaware Street needs a valley gutter to properly convey storm water. Runoff collects at the west side of the intersection and puddles. Standing water is a safety hazard to the traveling public and causes road breakdown and deterioration. The alley east of Main Street between Fourth and Fifth Ave South does not drain adequately resulting in flooded lower floors and basements specifically at City Hall. City Hall experiences water in its main floor after any significant rain event and at least once a year. It is expected that the other businesses in the area experience similar runoff problems. There is an existing 18” RCP in Fifth Ave South with capacity to accept runoff from this area. The intersection of Front Street and Central Ave South also need inlets at all four corners. There is an existing 18” RCP storm water pipe one half block to the west in Main street with adequate capacity to handle the small amount of runoff expected at this intersection. A summary of the problems with the existing infrastructure on the West Side of the railroad tracks is as follows:

1. Eight Ave South and the Alley west of Delaware Street (Horizon Lodge Retirement and Assisted Living Facility) Drainage Problems 2. Sixth Ave South and Iowa Street east side inlets and 8” collection pipes are too small and too shallow 3. Fifth Ave South and Iowa Street needs inlets at all four corners 4. Seventh Ave South and Delaware Street (north side) needs a valley gutter 5. Alley east of Main Street between Fourth and Fifth Ave South does not drain adequately resulting in flooded lower floors and basements specifically at City Hall 6. Front Street and Central Ave South needs inlets at all four corners

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2.3.3 Regulatory Assessment Storm water quality design requirements originate from the 1977 Clean Water Act (CWA) and the Safe Drinking Water Act. The storm water from the City of Conrad eventually enters the Marias River which is not designated by EPA as and impaired water body of Montana: therefore, the storm water quality standards that apply to the City of Conrad are determined by the National Pollutants Discharge Elimination System (NPDES). Contractors responsible for construction activities resulting in a disturbed area of 1 acre or more are required to apply for permit coverage under the NPDES stormwater rules. Prior to construction of a project in Conrad the contractor will be required to prepare and submit to DEQ a Storm Water Pollution Prevention Plan (SWPPP) and Notice of Intent (NOI). Changes to the stormwater quality requirements of the area are not expected anytime in the near future. Storm water quantity design requirements are included in DEQ Circular 8 Montana Standards for Subdivision Storm Drainage. DEQ 8 governs when a subdivision comes under review by DEQ; therefore, the rules apply to any new developments. The design of City of Conrad storm water improvements to address existing problems will not require DEQ review and approval.

Evaluation of East Side Storm Water 2.4.1 Description of Existing System The East Side of the railroad tracks was developed with paved streets but no ditches, no curb and gutter, and no storm water pipe. There is limited storm water infrastructure in Solid Road (north border of the East Side) which is owned and maintained by MDT. The Solid Road facility includes approximately 740 feet of 24” RCP storm water pipe and inlets between the alley east of Dakota Street sloped to the east where it daylights in a drainage ditch just east of Washington Street. The drainage ditch is a few feet deep and parallels Solid Road until the ditch turns south along the west side of the interstate where it drains to Pondera Coulee. There is a drainage ditch along the north and south sides of Fourth Ave S (south border of East Side) that drains to the east. The ditch along the north side of Fourth Ave S is a few feet deep and daylights at the east end of Fourth Ave S in a field. The ditch along the south side of the street is also a few feet deep and flows to the east until it hits the west side of Blazen Road where it turns south and drains to Pondera Coulee. There is also a drainage ditch along the east side of Blazen Road that also drains to the south to Pondera Coulee.

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Figure 8 – East Side Storm Water

2.4.2 Capacity and Condition Assessment The East Side area is plagued with storm water problems because there are no ditches, curb and gutter, or storm drainage infrastructure to move runoff out of the area. The runoff sits in the lower areas, at almost every intersection, and at several different areas along the streets. In some areas there is sitting water all year long that is up to 1’ deep. Conrad is made up of “Richey” clay loam soils that contribute to the amount of runoff. The sitting water becomes a stagnant breeding ground for disease carrying mosquitoes, causes roads to sluff into the low areas, and is

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a chronic road maintenance problem. After rain events large or small and snow melt cycles the City public works department is in this area pumping water across roadways and out of front yards. The area doesn’t drain; therefore, pumping sitting water across one approach only causes a problem at the next approach until the City has pumped the sitting water all the way from one side of the area to the other eventually to a drainage ditch or inlet. The residents of this area regularly complain about the sitting water often backing up to the foundations of their homes. The following pictures were taken in February during a low runoff time. During a rain or snow melt event the problems would be exponentially worse. Figure 9 – East Side Problems

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Evaluation of Storm Water Impacts on the Wastewater System It has been determined that storm water is draining into the wastewater system. Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant (WWTP). The storm water in the wastewater system results in wasted energy, unnecessary wear and tear on the lift station and the WWTP, increased operations and maintenance requirements, and E Coli violations. We anticipate that the problems with the existing West Side storm water system coupled with the East Side problems are contributing to the amount of storm water entering the wastewater system. According to DEQ Circular 2 – Design Standards for Public Sewage Systems, “Sewers must be designed for municipal wastewater only. Rainwater from roofs, streets, and other areas, and groundwater from foundation drains must not be permitted in municipal wastewater sewers.” The excess storm water causes problems at the WWTP which utilizes a UV disinfection system to treat for E Coli. In April and June of 2018, during high runoff events, the WWTP exceeded the E Coli limits of the City’s wastewater discharge permit by 575% and 291% for the two April samples and by 83% for the June sample. E Coli violations of the wastewater discharge permit is a serious threat to public health and safety. The wastewater produced by the City should be consistent from one month to the next unless there is an influx of people to Conrad and/or stormwater runoff is getting into the wastewater collection system. In the figure below we compared the average precipitation over the last three years (precipitation information from NOAA) to the inflows experienced at the WWTP. The data indicates a correlation between precipitation events and the increased flows experienced at the WWTP. We also have indicated the 2018 E Coli violations. The DEQ violations, the NOAA precipitation information, and the WWTP inflow information is included in Appendix E.

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Figure 10 – Precipitation Compared to Wastewater Treatment Plant Influent

Financial Status of Existing Facilities A summary of the City’s water and sewer revenues for the last three fiscal years is provided in the following table. A complete breakdown of the sewer and water revenues, expenditures, and rates are included in Appendix F. Table 3 – Summary of Sewer and Water Revenues

Revenues Expenditures Year Water Sewer Water Sewer 2017 $909,727 $595,585 $873,641 $355,690 2018 $923,894 $589,615 $690,027 $390,718 2019 $886,357 $594,910 $1,028,413 $675,160

The current water rates for the city of Conrad are established at a base rate of $38.04/month (for a ¾” service) plus a pump station fee of $5.00 per connection, and increases based on the size of the service and the quantity of water used. The water rates are included in Appendix F.

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The current sewer rates for the City are established at a base rate $27.81 per month plus $2.83 per thousand gallons of metered water usage and increases based on the size of the water service. The sewer rates are included in Appendix F. The target rate is a user rate that is established for each municipality across the state. The target rate is used to determine if the municipality is paying its fair share of a project’s cost. To apply for grant funding from the Montana Department of Commerce, the user rates after completion of the project must meet or exceed the target rates. The target rates are calculated as a percentage of the median income for the municipality. The percentages of median income are approximately 0.9 percent of the median household income for wastewater only, 1.4 percent of the median household income for water only, or 2.3 percent of the median household income for water and wastewater combined. For the 2020 application submissions for TSEP and CDBG the 2015 American Community Survey data shall be used to establish the target rate. The median household income in Conrad, according to the 2015 American Community Survey, was $39,063. According to the Montana Department of Commerce target rates for Conrad are as follows: Table 4 – Target Rates

Median Household Monthly System Percentage Income Target Rate Water $39,063 1.4% $45.57 Wastewater $39,063 0.9% $29.30 Combined $39,063 2.3% $74.87

The LMI information and target rate data is included in Appendix C. Target rates are based on equivalent dwelling units (EDUs); therefore, it is necessary to calculate the City’s existing rates based on EDUs. A 3/4-inch water service is a typical water service and is 1 EDU. The EDUs for each water service are calculated by comparing the area of the service line to the area of a ¾ inch service line. The number and sizes of the water services are included in Appendix D. The total commercial and residential EDU’s for Conrad are summarized in the following table.

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Table 5 - Equivalent Dwelling Units

Service EDU's per Size Service Services EDU's (inches) Size 3/4 1 1162 1162 1 1.79 45 81 1.5 4 14 56 2 7.14 14 100 3 16 3 48 4 28.57 4 114 Totals 1242 1561

The 2019 revenue from water sales was $886,357 (reference Table 3) giving an average monthly metered water charge in 2019 of $73,863 per month. The total number of EDU’s in 2019 was 1561; therefore, the 2019 water only rate per EDU was $47.32 per EDU per month. The 2019 revenue from sewer sales was $594,909.50 (reference Table 3) giving an average monthly metered water charge in 2019 of $49,576 per month. The total number of EDU’s in 2019 was 1561; therefore, the 2019 sewer only rate per EDU was $31.75 per EDU per month. “Commerce utilizes the combined rates for both water and wastewater systems in its target rate analysis. This helps to ensure that an applicant’s need for financial assistance is not understated if either of the systems have high rates, even though the other system may have relatively low rates.” The combined water and wastewater rate in 2019 was $79.07 per EDU per month. Conrad currently exceeds the target rate of $74.87 per EDU per month; therefore, Conrad is eligible for grant funding through the Treasure State Endowment Program administered by the Montana Department of Commerce.

Water/Energy/Waste Audits A water system preliminary engineering report was prepared in 2018 which evaluated the system including inefficiencies. As a result of the 2018 Water System PER, Conrad is currently working on improvements to the water treatment plant to improve the inefficiencies at the plant. The improvement is expected to result in water and energy conservation.

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3 NEED FOR PROJECT

Summary of Problems The storm water problems within the City were discussed in Chapter 2. Following is a summary of the general storm water problems: • Storm water is entering the sanitary sewer system • Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant. • The storm water in the wastewater system results in wasted energy and unnecessary wear and tear on the lift station and the mechanical wastewater treatment plant. • Pumping and treating the storm water results in increased operations and maintenance to the system • According to DEQ Circular 2 – Design Standards for Public Sewage Systems, “Sewers must be designed for municipal wastewater only. Rainwater from roofs, streets, and other areas, and groundwater from foundation drains must not be permitted in municipal wastewater sewers.” • In April and June of 2018 during times of high runoff, the City exceeded the E Coli limits of the discharge permit resulting in violations which is a serious threat to public health and safety. A summary of the storm water problems west of the railroad tracks is as follows:

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• The residents of this area regularly complain about the sitting water often backing up to the foundations of their homes.

Health, Sanitation & Security Health and safety of the public is by far the largest concern of any community. The City of Conrad has deficiencies within the storm water system that compromise the health and safety of the public. According to DEQ Circular 2 – Design Standards for Public Sewage Systems, “Sewers must be designed for municipal wastewater only. Rainwater from roofs, streets, and other areas, and groundwater from foundation drains must not be permitted in municipal wastewater sewers.” In April and June of 2018 during times of high runoff, the City exceeded the E Coli limits of the discharge permit resulting in violations which is a serious threat to public health and safety. The area east of the railroad tracks is very flat and was developed with paved streets but no ditches, no curb and gutter, and no storm water pipe. In some of these areas there is sitting water all year long that is up to 1’ deep. The sitting water becomes a stagnant breeding ground for disease carrying mosquitoes, causes roads to sluff into the low areas, and is a chronic road maintenance problem. The residents of this area regularly complain about the sitting stagnant water often backing up to the foundations of their homes and the resulting mosquito problem.

Aging Infrastructure Most of the City’s existing storm water system is made up of older RCP pipe some of which was installed prior to 1965 but the City has indicated it functions as designed with little to no problems. According to US Army Corp of Engineers Manual No. 1110-2-2902, “Most studies estimated product service life for concrete pipe to be between 70 and 100 years. Of nine state highway departments, three listed the life as 100 years, five states stated between 70 and 100 years, and one state gave 50 years.” As long as the City continues to regularly maintain the existing system it is expected to last several decades into the future and at least through the 20- year planning period.

System Operation and Maintenance The City’s public works superintendent, Dave Zimbelman, currently oversees the operation and management of the City’s system. Dave is one of three full time water and wastewater operators employed by the City, all of whom are licensed operators in the state of Montana. Conrad’s water, wastewater, and storm water systems are very well maintained and according to the 2015 Sanitary Survey, “the operators are to be commended for their hard work and dedication.” Some of the daily O&M requirements include manning the water and wastewater treatment plants each with its own full-time operator. The water and wastewater pumping and treatment facilities require regular O&M including regular inspection and cleaning. The City currently cleans and inspects the existing storm drainage pipes and inlets in the spring and fall and intermediately as needed. The system if made up of approximately 25,000 feet of

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various sizes of storm water pipe. The City has a vacuum truck they utilize for keeping the system operational.

Reasonable Growth The 2040 population was projected above based on information from the censuses since 1950. A growth rate was calculated and applied to the last census population to project a 2040 population of 3,148 residents. These projections are discussed in detail in Chapter 2. The furthest east area of town is a likely location for additional residential home construction. Plans to redevelop the existing trailer park located in this area have been considered in the past. If these lots were constructed upon it would only compound the drainage problems in the East Side of town.

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4 ALTERNATIVES CONSIDERED The City’s storm water problems were discussed in Chapter 2 and summarized in Chapter 3. This chapter provides an overall review of the storm water alternatives developed for review and consideration. A preliminary examination of possible system alternatives allows a broad approach to ultimate selection, thus ensuring adequate consideration of all feasible alternatives. Following the preliminary screening process, selected alternatives undergo a more detailed analysis, with the most viable alternatives of these being subject to a detailed design analysis and cost estimate. The development of optimized improvements to facilities can be a complex process. A preliminary consideration in this process is the cost of the improvements, including initial and future capital costs and annual reliability and flexibility, and process energy and resource requirements. These factors must be considered together in order to determine the best alternative for fulfilling community goals. Regardless of the alternative selected, certain improvements are necessary west of the railroad tracks and are the only solution to the problem. Since options are limited to address these problems the following improvements will be included in the final project but will not impact alternative selection and have been excluded from the alternative analysis.

1. Grading and Storm water inlet improvements at Eighth Ave South and the Alley west of Delaware Street (Horizon Lodge Retirement and Assisted Living Facility) 2. Storm water inlet and lateral improvements at Sixth Ave South and Fifth Ave South at Iowa Street 3. Gutter at Seventh Ave South and Delaware Street (north side) 4. Storm water extension in the Alley east of Main Street between Fourth and Fifth Ave South (City Hall) 5. Storm water inlets at Front Street and Central Ave South Since the problems with the existing stormwater system will be addressed with the bulleted improvements the following storm water alternatives have been developed for consideration to address the problems east of the railroad tracks where no existing stormwater infrastructure exists.

Alternative 1- No Action

Description This alternative includes taking no action to address the City’s storm water problems. Storm water would continue entering the sanitary sewer system which is specifically against the requirements of DEQ Circular 2. Storm water entering the sewer system would continue to adversely impact the lift station and the City’s mechanical wastewater treatment plant. The unnecessary pumping and treatment of the storm water resulting in increased energy and operations and maintenance costs would not be addressed. The public health and safety concerns

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associated with the e coli violations at the wastewater treatment plant during rainfall and/or snow melt runoff events would not be addressed. The flooding problems east of the railroad tracks would not be addressed. The sitting stagnant water in this area resulting in a breeding ground for disease carrying mosquitoes, road deterioration, and chronic road maintenance problems would also not be addressed. The concerns of the residents of this area east of the railroad tracks would also not be addressed with this alternative. The poor road conditions limiting access to the Horizon Lodge Retirement and Assisted Living Facility would not be addressed. The traffic hazards and operations and maintenance requirements associated with the standing water and ice on the streets at the intersections of Fifth and Sixth Ave South with Iowa Street and at the intersection of Seventh Ave South with Delaware Street would not be addressed. Flooding at the businesses and at City Hall along the east side of Main Street between Fourth and Fifth Ave South would not be addressed.

Design Criteria No additional design requirements are necessary if no action is taken.

Map A schematic of the existing system is included above in the first several figures. With this alternative, improvements would not be made to the existing storm water system or to address the problems on the east side of the railroad tracks.

Environmental Impacts There would be no additional environmental impacts from the no action alternative. No action would continue to result in future e coli violations from the effluent at the wastewater treatment plant. Discharging e coli from the plant is an adverse environmental impact to the downstream drainage.

Land Requirements This alternative requires no additional land acquisition or development. Potential Construction Problems No construction is required for this alternative. Sustainability Considerations Continued unnecessary operations and maintenance at the lift station and mechanical wastewater treatment plant, along with the e coli violations during rainfall and snow melt runoff events, and the road, flooding, standing water, and mosquito problems associated with the storm water is not sustainable. If no improvements are made all of these problems will continue to hinder the City. This alternative does not address the City’s storm water problems or the indirect issues at the lift station and mechanical wastewater treatment plant and will NOT be further analyzed in this report.

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Cost Estimates This alternative would not require additional infrastructure costs but would continue to impact the O&M costs caused by the storm water runoff problems discussed above.

Alternative 2 – East Side Area Ditches to Convey Storm Water

This alternative would include excavating ditches adjacent to all the East Side area streets to convey storm water out of the area. Culverts would be required at the approaches to each lot and under the cross streets. The existing dedicated right of way (ROW) is generally 80’ wide and the existing paved streets are 30’ wide leaving approximately 25’ of ROW on either side of the paved streets for the ditches. The ditches would be graded to drain to the south end and under Fourth Avenue South, along the west side of Blazen Road, eventually to Pondera Coulee. The ditches would start at a depth of approximately 2’ deep on the north end, would be sloped at a minimum 0.5% grade (to ensure no sitting surface water), and would be approximately 7 feet deep on the south end. Ditch side slopes no steeper than 3:1 is suggested adjacent to the streets and 2:1 for the backslopes. The width of the ditches on both sides of the road at the north end would be approximately 10’ wide and on the south end at least 35’ wide. The residents and businesses in this area have historically used the area between the edge of pavement and the ROW line as parking, landscape area, lawn area, etc. In many places there are mature trees, fences, grass, irrigation systems, utilities, fire hydrants, mailboxes, light poles, street signs, concrete, gravel, etc. that would be impacted if the area was to be utilized as a drainage ditch. Figure 11 – Heavily Used Area Between Edge of Asphalt and ROW

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The 7 feet deep ditches on the south end would be a traffic safety hazard due to the proximity to the travelling public. Existing water and sewer mains would need to be adjusted if possible. Sewer and water main conflicts could render this alternative unfeasible. This alternative would be very intrusive to the existing properties and existing utilities in the area. The project would result in adverse impacts to the areas that have been historically used and relied upon by the residents as part of their lot. It also anticipated that the matching funds for a project like this would come from a Special Improvement District (SID). A SID requires at least 60% and up to 75% of the residents in the SID to agree. Further discussions about the funding options is included below. We expect this alternative would not be preferred by the residents of the East Side area. This alternative will not be further considered.

Alternative 3 – East Side Area Curb and Gutter and Storm Drain S y s t e m Description This alternative would include installing curb in all streets in the East Side area and a storm drain system in several of the streets. The streets would generally remain graded as they currently are with only small adjustments as necessary. The storm drainage system would be installed beneath the existing streets and drain to the south daylighting south of Fourth Ave South and west of Blazen Road in the existing ditch. The existing ditch along the west side of Blazen Road would be regraded to Pondera Coulee. To install the curb and gutter, a small strip of asphalt would be sawcut along either side of the roads, the curb and gutter subgrade would be prepared, the curb and gutter installed, and asphalt placed up against the new curb and gutter. Storm water curb inlets would be sized and installed in all low spots and at intermediate locations necessary to keep the spread width reasonable based on the determined design storm. The area behind the new curb and gutter would be regraded to drain towards the street if possible and the surface restored to preconstruction conditions. The storm drainage pipe would also be sized to convey the design storm. Pipe sizes in the upper areas of the system are expected to be 18” at the smallest but still big enough for the City to easily maintain. The pipes would get bigger as inlets were connected and the contributing runoff increased. We expect the furthest downstream pipe to be 36” diameter and would daylight at the far south end of the East Side at the south west corner of the Fourth Ave South and Blazen Road intersection. The ditch along the west side of Blazen Road would be regraded to the south to its intersection with Pondera Coulee. There is currently one culvert beneath an approach in this section of ditch that would need to be adequately upsized to address the additional flow. Blazen Road is a county road and an agreement would need to be worked out with Pondera County to discharge the system to the ditch and to do the required work in the ditch. Once the curb and gutter, storm drain system, asphalt, and surface restoration was complete all the East Side streets would be chip sealed.

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Design Criteria Storm water quality design requirements originate from the 1977 Clean Water Act (CWA) and the Safe Drinking Water Act. The storm water from the City of Conrad eventually enters the Marias River which is not designated by EPA as and impaired water body of Montana: therefore, the storm water quality standards that apply to the City of Conrad are determined by the National Pollutants Discharge Elimination System (NPDES). Contractors responsible for construction activities resulting in a disturbed area of 1 acre or more are required to apply for permit coverage under the NPDES stormwater rules. Prior to construction of a project in Conrad the contractor will be required to prepare and submit to DEQ a Storm Water Pollution Prevention Plan (SWPPP) and Notice of Intent (NOI). Changes to the stormwater quality requirements of the area are not expected anytime in the near future. MT State standards for storm water quantity design are considered in DEQ Circular 8 Montana Standards for Subdivision Storm Drainage and in Chapter 11 – Drainage and Irrigation Design of the MDT Road Design Manual. Chapter 11 of the Road Design Manual also references the MDT Hydraulics Manual. DEQ 8 and MDT Standards will be utilized as general guidelines for the design of a storm water system although approval from neither agency is required. Map Following is a schematic of this alternative.

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Figure 12 – Alternative 3 Curb and Gutter and Storm Drain System

Environmental Impacts Adverse environmental impacts are not expected with the implementation of this alternative. All work is limited to inside existing City and County ROW, in existing roads and streets, and all work is in areas that have been previously impacted, constructed upon, and disturbed. We anticipate the work to end before Pondera Coulee. We do not anticipate impacts to previously undisturbed areas, wetlands, or other areas of environmental concern. General environmental considerations were discussed above, and a Uniform Environmental Checklist and 2020 Storm Water PER City of Conrad 35

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Environmental Review Form was completed and is included in Appendix A. Comments from the regulatory agencies have been requested. Any comments received from the regulatory agencies have been included in Appendix B. Land Requirements We do not anticipate the need for additional land for this alternative. All work is limited to inside existing City and County ROW, in existing roads and streets. Blazen Road is a county road and an agreement would need to be worked out with Pondera County to discharge the system to the ditch and to do the required work in the ditch. Potential Construction Problems We do anticipate high groundwater in this area. A geotechnical evaluation including groundwater levels would be required during design to evaluate soils and groundwater conditions. A dewatering plan will likely be required from the contractor. The contractor will also be responsible for any necessary dewatering permits. In additional to the high groundwater the new storm drainage system will cross existing water and sewer mains and services. We don’t anticipate problems with water main and water service crossings but conflicts with gravity sewer mains and gravity sewer services will have an impact on the storm drainage system and will be considered during design. Sustainability Considerations To the extent practical, the final design will include provisions to minimize energy consumption and conserve water both of which are in the financial interests of the City and good engineering practice entails its consideration. Conrad has an existing storm drainage system and the equipment, expertise, and programs in place for system maintenance and will not require additional training for the operators or new equipment. This alternative is a sustainable improvement to the system. Cost Estimates The total cost estimate including 10% contingency and 20% engineering is included in the following table. The City currently invests time in the East Side during runoff events to address standing water and flooding adjacent to existing homes; therefore, the new system could result in reduced operator O&M but since we expect all three alternatives to result in a similar O&M savings we have excluded present worth analysis of the savings from the cost estimates below. Unit costs were based on bid tabs for similar projects and/or from equipment suppliers. The project costs are projected to 2022 which is when the project is anticipated for construction. According to Construction Analytics 2020 Construction Economic Forecast – January 2020, “Nonresidential buildings inflation, after hitting 5% in both 2018 and 2019, is forecast for the next three years to fall from 4.4% to 3.8%, lower than the 4.5% average for the last 4 years.” An annual construction cost inflation factor of 3.8% was used to project the costs.

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Table 6 – Alternative 3 Cost Estimate

Item Unit Quantity Unit Cost Total General Requirements (assumed 8% LS 1 $258,000 $258,000 mobilization, bond, insurance etc.) Traffic Control LS 1 $75,000 $75,000 Dewatering LF 3900 $20 $78,000 Remove Asphalt SY 9300 $6 $55,800 Water Main Adjustment EA 4 $8,000 $32,000 Water Service Adjustment EA 12 $2,000 $24,000 Sewer Main Adjustment LF 400 $100 $40,000 Drop Inlet EA 52 $4,000 $208,000 48" Manhole EA 12 $3,500 $42,000 60" Manhole EA 3 $4,700 $14,100 72" Manhole EA 2 $6,100 $12,200 84" Manhole EA 1 $8,500 $8,500 18" PVC Storm Drain LF 3600 $55 $198,000 24" PVC Storm Drain LF 2400 $70 $168,000 36" PVC Storm Drain LF 1800 $90 $162,000 36" HDPE Culvert W FETS LF 60 $150 $9,000 Blazen Road Ditch Improvements LS 1 $10,000 $10,000 Crushed Base Course CY 5000 $35 $175,000 Curb and Gutter LF 27000 $25 $675,000 Asphalt Patch SY 9300 $30 $279,000 Chip Seal - Cover Type 2 SY 45000 $8 $337,500 Chip Seal - Emulsified Asphalt GAL 18000 $8 $144,000 Regrade Behind Curb LS 1 $150,000 $150,000 Gravel Restoration CY 5000 $35 $175,000 Yard Restoration SY 15000 $15 $225,000 Class II RipRap CY 5 $250 $1,250 Alternate 3 Construction Cost (2020) $3,556,350 Alternate 3 Construction Cost (2022) $3,831,768 Contingency 10% $ 383,177 Total Construction Cost (2022) $4,214,945

Engineering and Permitting 20% $ 842,989 Total Cost (2022) $5,057,934

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Alternative 4 – East Side Area Storm Drain System No Curb and Gu t t er Description This alternative would include installing a storm drain system for the East Side area. The streets would generally remain graded as they currently are with only small adjustments as necessary. The storm drainage system would be installed beneath the existing streets and drain to the south daylighting south of Fourth Ave South and west of Blazen Road in the existing ditch. The existing ditch along the west side of Blazen Road would be regraded to Pondera Coulee. The storm drainage curb inlets, field inlets, and pipes would be sized to convey the design storm. The curb and field inlets would be sized and installed in all low spots and at intermediate locations necessary to keep the spread width reasonable based on the determined design storm. We do anticipate grading within the City ROW with some culverts beneath approaches to ensure runoff drains to the curb and field inlets. Pipe sizes in the upper areas of the system are expected to be 18” at the smallest but still big enough for the City to easily maintain. The pipes would get bigger as inlets were connected and the contributing runoff increased. We expect the furthest downstream pipe to be 36” diameter and would daylight at the far south end of the East Side at the south west corner of the Fourth Ave South and Blazen Road intersection. The ditch along the west side of Blazen Road would be regraded to the south to its intersection with Pondera Coulee. There is currently one culvert beneath an approach in this section of ditch that would need to be adequately upsized to address the additional flow. Blazen Road is a county road and an agreement would need to be worked out with Pondera County to discharge the system to the ditch and to do the required work in the ditch. Once the storm drain system is installed and asphalt patched the East Side streets that were patched would be chip sealed. Design Criteria Storm water quality design requirements originate from the 1977 Clean Water Act (CWA) and the Safe Drinking Water Act. The storm water from the City of Conrad eventually enters the Marias River which is not designated by EPA as and impaired water body of Montana: therefore, the storm water quality standards that apply to the City of Conrad are determined by the National Pollutants Discharge Elimination System (NPDES). Contractors responsible for construction activities resulting in a disturbed area of 1 acre or more are required to apply for permit coverage under the NPDES stormwater rules. Prior to construction of a project in Conrad the contractor will be required to prepare and submit to DEQ a Storm Water Pollution Prevention Plan (SWPPP) and Notice of Intent (NOI). Changes to the stormwater quality requirements of the area are not expected anytime in the near future. MT State standards for storm water quantity design are considered in DEQ Circular 8 Montana Standards for Subdivision Storm Drainage and in Chapter 11 – Drainage and Irrigation Design of the MDT Road Design Manual. Chapter 11 of the Road Design Manual also references the MDT Hydraulics Manual. DEQ 8 and MDT Standards will be utilized as general guidelines for the design of a storm water system although approval from neither agency is required.

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Map Following is a schematic of this alternative. Figure 13 – Alternative 4 Storm Drain System No Curb and Gutter

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undisturbed areas, wetlands, or other areas of environmental concern. General environmental considerations were discussed above, and a Uniform Environmental Checklist and Environmental Review Form was completed and is included in Appendix A. Comments from the regulatory agencies have been requested. Any comments received from the regulatory agencies have been included in Appendix B. Land Requirements We do not anticipate the need for additional land for this alternative. All work is limited to inside existing City and County ROW, in existing roads and streets. Blazen Road is a county road and an agreement would need to be worked out with Pondera County to discharge the system to the ditch and to do the required work in the ditch. Potential Construction Problems We do anticipate high groundwater in this area. A geotechnical evaluation including groundwater levels would be required during design to evaluate soils and groundwater conditions. A dewatering plan will likely be required from the contractor. The contractor will also be responsible for any necessary dewatering permits. In additional to the high groundwater the new storm drainage system will cross existing water and sewer mains and services. We don’t anticipate problems with water main and water service crossings but conflicts with gravity sewer mains and gravity sewer services will have an impact on the storm drainage system and will be considered during design. Sustainability Considerations To the extent practical, the final design will include provisions to minimize energy consumption and conserve water both of which are in the financial interests of the City and good engineering practice entails its consideration. Conrad has an existing storm drainage system and the equipment, expertise, and programs in place for system maintenance and will not require additional training for the operators or new equipment. This alternative is a sustainable improvement to the system. Cost Estimates The total cost estimate including 10% contingency and 20% engineering is included in the following table. The City currently invests time in the East Side during runoff events to address standing water and flooding adjacent to existing homes; therefore, the new system could result in reduced operator O&M but since we expect all three alternatives to result in a similar O&M savings we have excluded present worth analysis of the savings from the cost estimates below. Unit costs were based on bid tabs for similar projects and/or from equipment suppliers. The project costs are projected to 2022 which is when the project is anticipated for construction. According to Construction Analytics 2020 Construction Economic Forecast – January 2020, “Nonresidential buildings inflation, after hitting 5% in both 2018 and 2019, is forecast for the next three years to fall from 4.4% to 3.8%, lower than the 4.5% average for the last 4 years.” An annual construction cost inflation factor of 3.8% was used to project the costs.

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Table 7 – Alternative 4 Cost Estimate

Item Unit Quantity Unit Cost Total General Requirements (assumed 8% LS 1 $125,000 $125,000 mobilization, bond, insurance etc.) Traffic Control LS 1 $36,000 $36,000 Dewatering LF 4200 $20 $84,000 Remove Asphalt SY 8300 $6 $49,800 Water Main Adjustment EA 4 $8,000 $32,000 Water Service Adjustment EA 17 $2,000 $34,000 Sewer Main Adjustment LF 550 $100 $55,000 Drop Inlet EA 4 $4,000 $16,000 Field Inlet EA 44 $3,200 $140,800 48" Manhole EA 13 $3,500 $45,500 60" Manhole EA 3 $4,700 $14,100 72" Manhole EA 2 $6,100 $12,200 84" Manhole EA 1 $8,500 $8,500 18" PVC Storm Drain LF 4100 $55 $225,500 24" PVC Storm Drain LF 2400 $70 $168,000 36" PVC Storm Drain LF 1800 $90 $162,000 18" HDPE Culvert LF 240 $80 $19,200 36" HDPE Culvert LF 60 $150 $9,000 Blazen Road Ditch Improvements LS 1 $10,000 $10,000 Asphalt Patch SY 8300 $30 $249,000 Chip Seal - Cover Type 2 SY 14000 $8 $105,000 Chip Seal - Emulsified Asphalt GAL 5600 $8 $44,800 Regrade ROW LS 1 $50,000 $50,000 Gravel Restoration CY 150 $45 $6,750 Yard Restoration SY 550 $25 $13,750 Class II RipRap CY 5 $250 $1,250 Alternate 4 Construction Cost (2020) $1,717,150 Alternate 4 Construction Cost (2022) $1,850,133 Contingency 10% $ 185,013 Total Construction Cost (2022) $2,035,146

Engineering and Permitting 20% $ 407,029 Total Cost (2022) $2,442,176

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5 SELECTION OF AN ALTERNATIVE

Life Cycle Cost Analysis When comparing alternatives, the cost-effectiveness, which is determined from the monetary present-worth analysis, is considered the single most important comparison parameter. This economic comparison includes estimated capital cost expenditures and annual O&M costs. The cost estimates presented, and any resulting conclusions on project financial or economic feasibility or funding requirements, have been prepared for guidance in project evaluation and implementation from the information available at the time of the estimate. The final costs of the project and resulting feasibility will depend on actual site conditions, final project scope, and other variable factors. As a result, the final project costs will vary from the estimates presented herein. Because of these factors, project feasibility, benefit/cost ratios, risk, and funding needs must be carefully reviewed prior to making specific financial decisions or reestablishing project budgets to help ensure proper project evaluation and adequate funding. Economic evaluations of the alternatives require consideration of annual O&M costs as well as capital costs. O&M expenses include labor, energy, process chemicals if any, maintenance materials and supplies, residuals disposal if any, etc. Labor estimates for new facilities are typically based primarily on published references or labor requirements at other facilities familiar to the Engineer. Energy costs for new facilities are based on estimates of the average requirements for each unit process using local utility rates. Equipment maintenance costs for new facilities are based on a percentage of the initial equipment costs, dependent on the type of equipment and its use, or published references. When comparing alternatives based on cost, it is important that the comparison include both capital costs and the difference in the present worth of the operation and maintenance costs. An alternative with a low initial capital cost may not be the most cost-efficient project if high monthly operation and maintenance costs occur with the alternative. Salvage values are often included in present worth estimates, particularly where alternatives may be substantially different in nature (for instance one alternative involving substantial earthwork and one involving substantial mechanical work). The importance of the concept of salvage value is diminished when comparing mostly similar treatment elements. The City currently invests time to address standing water and flooding adjacent to existing homes. We do expect a potential reduction in the O&M associated with addressing the flooding needs. Since we expect all three alternatives to result in a similar O&M savings, we have excluded present worth analysis of the savings from the cost estimates below. The following table provides a summary of the anticipated costs associated with each alternative.

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Table 8 – Project Cost Summary

Alternatives Project Cost Alternative 3 - East Side Area Curb and $5,057,934 Gutter and Storm Drain System Alternative 4 - East Side Area Storm $2,442,176 Drain System No Curb and Gutter

Non-Monetary Factors The alternatives presented in this study can and must be compared in a variety of non-monetary ways. To provide structure and a methodology to this comparison, the alternatives will be compared on seven broad criteria as listed below. The comparison and ranking of some of these criteria will result in only very subtle differences that must be considered in the overall evaluations.

• Public Health and Safety – Will the alternative protect and enhance the health and safety of the residents? • Public Acceptance - Will the alternative meet the needs of the residents and will the residents be receptive to the alternative? • Local Economic Affect – What affect does the alternative have in terms of keeping money in the local economy through local capital purchase, construction spending, and/or employment of local citizens? • Environmental Impacts – What affect does the alternative have in terms of adverse impact to the environment? • Impacts to Existing Facilities – Will the alternative impact existing City facilities or the property and facilities of the residents? • Reliability – Will the alternative be reliable both now and in the long term with respect to future potential requirements? • Operational Ease - Will the alternative be easy to operate and maintain in relation to the existing facility?

Each alternative is compared below within the framework of these criteria. 5.2.1 Public Health and Safety We anticipate either alternative to benefit the public health and safety by reducing the amount of storm water entering the sanitary sewer system. Storm water in the wastewater system results in wasted energy, unnecessary wear and tear on the lift station and the WWTP, increased operations and maintenance requirements, and E Coli violations. The excess storm water causes problems at the WWTP which utilizes a UV disinfection system to treat for E Coli. In April and June of 2018, during high runoff events, the WWTP exceeded the E Coli limits of the City’s wastewater discharge permit by 575% and 291% for the two April samples and by 83% for the June sample.

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E Coli violations of the wastewater discharge permit is a serious threat to public health and safety. 5.2.2 Public Acceptance The public has concerns about any of the alternatives but generally understand the needs. To implement any of the alternatives we anticipate an increase in utility rates and/or implementation of and Special Improvements District (SID) to cover the costs. Any increase in user rates and/or taxes is generally not favorable by the public; therefore, the most cost-effective solution in the long term would be the most publicly accepted option. There are no other anticipated adverse effects to the public other than the rate increase. When comparing the alternatives, the most cost-effective Alternative 4 would be more widely accepted by the public. 5.2.3 Local Economic Affect Either alternative would result in a large project requiring state and federal grant and loans. The programs available for funding projects like these require the construction to be bid to any qualified contractor whether they are local or not. We don’t anticipate either alternative to benefit the local economy better than the other; therefore, we have assigned the same credit to each regarding the criterion. 5.2.4 Environmental Impacts Neither alternative is anticipated to result in more of an adverse environmental impact compared to the other; therefore, we have assigned the same credit to each regarding this criterion. 5.2.5 Impacts to Existing Facilities We anticipate Alternative 4 to result in less impact to the existing City facilities and to private property in the East Side Area because it does not include curb and gutter. Alternative 4 would include placing field inlets in existing low areas to capture runoff in those areas it is currently ponding. To implement the curb and gutter proposed with Alternative 3 would require a large grading a surface restoration effort for a 20’ width behind the curb. This area is currently heavily used by the residents and businesses and is developed as yards, landscaping, parking areas, etc, 5.2.6 Reliability Neither alternative is more reliable than the other; therefore, we have assigned the same credit to each regarding this criterion. 5.2.7 Operational Ease We anticipate Alternative 3 to result in an easier system to operate. With Alternative 3 the storm drainage inlets would be installed in the streets with storm water collected and conveyed in the curb and gutter. We anticipate the street inlets to require less operational needs than the field inlets proposed with Alternative 4.

Comparative Summary Using the monetary and non-monetary information presented above, a comparative summary evaluation and ranking of alternatives is presented in the following table. For each of the criteria discussed above, each alternative was assigned a ranking score designated with either a 1 or a 2, with 2 being the most favorable and 1 being the least favorable. The ranking factors were then

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multiplied by the relative weight of importance assigned to each evaluation criteria. The weighted rank scores were then summed, resulting in a weighted rank total score, the greatest score indicating the highest ranking. The weighing of each criterion in descending order is as follows:

• Cost Effectiveness and Public Health and Safety - 6 • Public Acceptance and Local Economic Affect - 4 • Environmental Impacts and Impacts to Existing Facilities - 3 • Reliability and Operational Ease – 2

Table 9 – Alternative Comparative Summary

Comparison Parameter Alternatives Parameter Weight 3 4 Cost Effectiveness Alternative Rank 1 2 6 Weighted Rank 6 12 Public Health and Safety Alternative Rank 2 2 6 Weighted Rank 12 12 Public Acceptance Alternative Rank 1 2 4 Weighted Rank 4 8 Local Economic Affect Alternative Rank 1 1 4 Weighted Rank 4 4 Environmental Impacts Alternative Rank 1 1 3 Weighted Rank 3 3 Impacts to Existing Facilities Alternative Rank 1 2 3 Weighted Rank 3 6 Reliability Alternative Rank 1 1 2 Weighted Rank 2 2 Operational Ease Alternative Rank 2 1 2 Weighted Rank 4 2

Weighted Rank Total 38 49

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6 PROPOSED PROJECT Alternative 4 - East Side Area Storm Drain System No Curb and Gutter is the recommended alternative to address Conrad’s existing storm water problems. Alternative 4 includes installing a storm drain system for the East Side area. The streets would generally remain graded as they currently are with only small adjustments as necessary. The storm drainage system would be installed beneath the existing streets and drain to the south daylighting south of Fourth Ave South and west of Blazen Road in the existing ditch. The existing ditch along the west side of Blazen Road would be regraded to Pondera Coulee. Figure 14 – Alternative 4 East Side Area Storm Drain System No Curb and Gutter

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In additional to Alternative 4, the following improvements would be made to the existing storm drainage system located west of the railroad tracks:

1. Grading and Storm water inlet improvements at Eighth Ave South and the Alley west of Delaware Street (Horizon Lodge Retirement and Assisted Living Facility) o This work would include re-grading the ditch along the Alley west of the Horizon Lodge. A new storm drain inlet would be installed at the north west corner of the intersection and a new section of 18” storm water pipe would daylight approximately 120’ south east of the intersection. Coordination with the landowner would be required. 2. Storm water inlet and lateral improvements at Sixth Ave South and Fifth Ave South at Iowa Street o This work would include upsizing the existing inlets and storm water laterals at Sixth Avenue South and Iowa Street. The existing asphalt, inlets, and storm water laterals would be replaced with larger inlets and laterals and slopes increased if elevations allow. The asphalt would be replaced. o This work would also include adding storm water inlets and storm water laterals at all four corners of Fifth Avenue South and Iowa Street. The existing asphalt would be removed, and new inlets and laterals installed. The asphalt would be replaced. 3. Gutter at Seventh Ave South and Delaware Street (north side) o This work would include removing the existing asphalt, re-grading the intersection, pour a new valley gutter, and replacing the asphalt. 4. Storm water extension in the Alley east of Main Street between Fourth and Fifth Ave South (City Hall) o This work would include installing 350’ of new 18” storm water pipe in the gravel Alley east of Main Street connecting to the existing storm water pipe in Fifth Ave South. New inlets would be installed in low spots and gravel replaced. 5. Storm water inlets at Front Street and Central Ave South o This work would include installing 350’ of new 18” storm water pipe in Central Ave between Main Street and Front Street connecting to the existing storm water pipe in Main Street. New inlets would be installed at all four corners of the Front Street and Central Avenue intersection. The asphalt would be replaced.

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Figure 15 – West Side Improvements to Existing Storm Drainage System

Preliminary Project Design Storm water quality design requirements originate from the 1977 Clean Water Act (CWA) and the Safe Drinking Water Act. The storm water from the City of Conrad eventually enters the Marias River which is not designated by EPA as and impaired water body of Montana: therefore, the storm water quality standards that apply to the City of Conrad are determined by the National Pollutants Discharge Elimination System (NPDES). 2020 Storm Water PER City of Conrad 48

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MT State standards for storm water quantity design are considered in DEQ Circular 8 Montana Standards for Subdivision Storm Drainage and in Chapter 11 – Drainage and Irrigation Design of the MDT Road Design Manual. Chapter 11 of the Road Design Manual also references the MDT Hydraulics Manual. Runoff for this project would be evaluated using Autodesk’s Storm and Sanitary Analysis (SSA) software which is a hydrologic and hydraulic modeling software. Hydrologic calculations would be based on EPA’s Storm Water Management Model (SWMM), and infiltration evaluated using the NRCS (SCS) Curve Number Method. Drainage basins would be divided into subbasins, as necessary, for the purpose of evaluating and modeling areas contributing to the existing and proposed storm drainage infrastructure.

Project Schedule Before the project can be implemented, the funding must be in place. Among other sources, the proposed funding strategy includes a TSEP grant. The TSEP grant application are currently due by June 12th, 2020. The City would likely not know until spring of 2021 whether their project has been funded. Upon securing all funding, the project start-up for the grant program is expected to be about a two-month process. The engineering could begin once a contract is in place between the funding agencies and the City and between the City and the engineering firm, likely during the second or third quarter of 2021. DEQ review would likely take place in the winter of 2021 with approval anticipated by spring of 2022. Once DEQ approval is granted, it is anticipated that the project would be bid early in 2022. It is anticipated for construction to begin in the spring of 2022. Due to the nature of the work and the size of the project it is anticipated that construction will extend into the spring and summer of 2023. The following table provides a summary of the expected schedule.

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Table 10 – Project Schedule

QUARTERS, 2020 QUARTERS, 2021 QUARTERS, 2022 QUARTERS, 2023 TASK 1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd JFM AMJ JAS OND JFM AMJ JAS OND JFM AMJ JAS OND JFM AMJ JAS Project Startup Advertise for & NA Select Engineer Finalize PER X Submit Funding X Applications Legislative Action of X Applications Grant Award X Project Design Commence Final X Design Complete X Project Design Submit Plans to X DEQ Prepare Bid X Documents Advertisement

for Const. Bid Public Bid & X Advertisements Open Bids & Examine X Proposals Request Contr. X Documents Select Contractor & X Award Bid Conduct Pre- Const. X Conference Notice to Proceed to X Contractor

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Project

Construction Begin X Construction Monitor X X X X X X Contractor Labor Compliance X X X Reviews Hold Const. Progress X X X X X X Meetings Final Inspection X Project Close

Out Submit Final X Drawdown Project Completion X Report Submit Record X DWGs to DEQ

Permit Requirements Contractors responsible for construction activities resulting in a disturbed area of 1 acre or more are required to apply for permit coverage under the NPDES stormwater rules. Prior to construction of a project in Conrad the contractor will be required to prepare and submit to DEQ a Storm Water Pollution Prevention Plan (SWPPP) and Notice of Intent (NOI). Changes to the stormwater quality requirements of the area are not expected anytime in the near future. DEQ 8 and MDT Standards will be utilized as general guidelines for the design of a storm water system although approval from neither agency is required.

Sustainability Considerations To the extent practical, the final design will include provisions to minimize energy consumption and conserve water both of which are in the financial interests of the City and good engineering practice entails its consideration. Conrad has an existing storm drainage system and the equipment, expertise, and programs in place for system maintenance and will not require additional training for the operators or new equipment. This project is a sustainable improvement to the system.

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Total Project Cost Estimate The total project cost estimate including 10% contingency and 20% engineering is included in the following table. The total cost includes the West Side Improvements and the East Side Improvements Alternative 4 - East Side Area Storm Drain System No Curb and Gutter. Unit costs were based on bid tabs for similar projects and/or from equipment suppliers. The project costs are projected to 2022 which is when the project is anticipated for construction. According to Construction Analytics 2020 Construction Economic Forecast – January 2020, “Nonresidential buildings inflation, after hitting 5% in both 2018 and 2019, is forecast for the next three years to fall from 4.4% to 3.8%, lower than the 4.5% average for the last 4 years.” An annual construction cost inflation factor of 3.8% was used to project the costs. Table 11 – Total Project Construction and Engineering Cost Estimate

Project Item Unit Quantity Unit Cost Total General Requirements (assumed 8% mobilization, LS 1 $25,000 $25,000

bond, insurance etc.) Traffic Control LS 1 $7,000 $7,000 Dewatering LF 730 $20 $14,600 Regrade Alley Ditch LS 1 $2,500 $2,500 Remove Existing Pipe and LS 1 $1,000 $1,000 Outlet Field Inlet EA 1 $3,200 $3,200 18" PVC Storm Drain LF 120 $55 $6,600 Storm WaterStorm

Improvements Landowner Coordination LS 1 $5,000 $5,000 Eighth S Ave Alley &

- West Side Subtotal Construction Cost (2020) $18,300 1 Remove Asphalt SY 620 $6 $3,720 Remove Existing Pipe and

ve S & & S ve LS 1 $2,500 $2,500 Inlets Drop Inlet EA 8 $4,000 $32,000 48" Manhole EA 2 $3,500 $7,000 West SideWest Improvments 18" PVC Storm Drain LF 400 $55 $22,000 Improvements Asphalt Patch SY 620 $30 $18,600 Iowa Water Street Storm

2-Fifth and Sixth A West Side Subtotal Construction Cost (2020) $85,820 Remove Asphalt SY 310 $6 $1,860 Regrade Intersection LS 1 $5,000 $5,000 Concrete Valley Gutter SY 55 $160 $8,800

Gutter Asphalt Patch SY 310 $30 $9,300 and Delaware

3-Seventh S Ave West Side Subtotal Construction Cost (2020) $24,960 4- ey ey Remove Asphalt SY 40 $6 $240 Ea All

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48" Manhole EA 2 $3,500 $7,000 18" PVC Storm Drain LF 390 $55 $21,450 Drop Inlet EA 4 $4,000 $16,000 Regrade Alley LS 1 $2,500 $2,500 Asphalt Patch SY 40 $30 $1,200 Gravel Restoration CY 30 $45 $1,350 Concrete Valley Gutter SY 30 $160 $4,800 West Side Subtotal Construction Cost (2020) $54,540 Remove Asphalt SY 1650 $6 $9,900 48" Manhole EA 2 $3,500 $7,000

e Se Storm 18" PVC Storm Drain LF 550 $55 $30,250 Drop Inlet EA 4 $4,000 $16,000 Asphalt Patch SY 1650 $30 $49,500 Water ExtensionWater 5-Front Street and5-Front West Side Subtotal Construction Cost (2020) $112,650 Central Av Central West Side Construction Cost (2020) $ 342,870 West Side Construction Cost (2022) $ 369,423 Contingency 10% $ 36,942 Total West Side Construction Cost (2022) $ 406,366

Engineering and Permitting 20% $ 81,273 Total West Side Cost (2022) $ 487,639 East Side Alternative 4 Cost (2022) $2,442,176 TOTAL PROJECT COST (2022) $2,929,814

Annual Operating Budget To formulate a financing plan for the water facilities improvements, the estimated cost of the project and the sources of potential revenue available must be known. Capital is required to design and build the facilities. The necessary capital can come from cash reserves, federal and/or state grants and loans, or be borrowed from other sources. Generally, all loans or borrowed capital are amortized in the form of bonds. The bonds are paid off a little each year at some stated interest rate and term, usually 20 to 40 years. 6.6.1 Income The average annual water and sewer system revenue over the past 3 fiscal years was presented previously and is approximately $900,000 and $600,000, respectively. The income generated by the water and sewer rates will increase as the City’s population increases. It anticipated that the matching funds for a project like this would come from a Special Improvement District (SID). A SID requires at least 60% and up to 75% of the residents in the SID to agree.

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6.6.2 Annual O&M The average annual water and sewer system expenses over the past 3 fiscal years was presented previously and is approximately $860,000 and $470,000, respectively. This includes operations, administration, miscellaneous costs, accounting/collection and debt service. The City’s financial information is included in Appendix F. The City currently invests time to address standing water and flooding adjacent to existing homes. We expect a reduction in the O&M associated with addressing the flooding needs. It was established above that storm water is entering the wastewater collection system. Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant. The storm water in the wastewater system results in wasted energy and unnecessary wear and tear on the lift station and the mechanical wastewater treatment plant. Pumping and treating the storm water results in increased operations and maintenance to the system. 6.6.3 Debt Repayment Conrad currently has several loans totaling approximately $4.8M with maturity dates ranging from 2021 to 2040. The summary of the debt is included in the following table. Table 12 – Summary of Debt

June 30, 2019 Origination Final Maturity Interest Type Balance Date Date Rate Water Series 2001A $121,000 9/4/2001 9/4/2021 2.00% Water Series 2014 $265,000 4/17/2014 7/1/2025 2.50% Water Series 2013 $630,000 8/21/2014 7/1/2034 2.50% Water Series 2017 WRF-18406 $445,000 9/12/2017 7/1/2037 2.50% Sewer SRF "C" 2010(part(5319 ) $211,000 6/25/2010 7/1/2030 3.00%

Revenue BondsRevenue Sewer ARRA SRF "B"2009 $184,000 9/24/2009 7/1/2029 0.75% (5310) Sewer SRF "D" $461,000 9/20/2012 7/1/2032 3.00% RD Sewer Loan (was 5314) $2,373,750 8/18/10 8/18/40 3.25% InterCap Loan Gov't 2419-01 $35,343 7/27/12 8/15/22 1.25% InterCap Water 2419-01 $35,343 7/27/12 8/15/22 1.25% Bonds InterCap Sewer 2419-01 $35,343 7/27/12 8/15/22 1.25%

Special Assessment InterCap Solid Waste 2419-01 $35,343 7/27/12 8/15/22 1.25% Total $4,832,123

The preliminary sources of funding available to local entities such as the City of Conrad wishing to undertake large capital projects has typically been through federal and state financial

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assistance. These funds have traditionally been used to underwrite major portions of projects through the issuance of grants or loans that may be repaid at terms favorable to most communities. Most of these programs require a local matching share that is most often obtained by issuing local government bonds. Funding programs often require that funds be appropriated during sessions of Congress or the state legislature, and in most cases the appropriated funds are less than the amount requested. Some of the available funding sources for this type of project include TSEP Grant, CDBG Grant, RRGL Grant, SRF Loan, and USDA Rural Development (RD) Grant and Loan. A summary including eligibility requirements for each of these programs can be found in Appendix F. Treasure State Endowment Program (TSEP) TSEP is a state funded grant program administered by the Montana Department of Commerce. TSEP provides financial assistance to local governments for infrastructure improvements. TSEP provides grant funds of up to $750,000 or 50% of the total project cost (up to $500,000 if rates are at target rate, up to $625,000 if rates exceed 125% of the target rate, and up to $750,000 if rates exceed 150% of the target rate). The other 50% can come from numerous other sources including other grants, loans, or cash. To be eligible for TSEP funds the established user rates must meet or exceed the target rate at the time the proposed project is complete. The target water and sewer rates and the 2019 water and sewer rates per EDU were presented above in Chapter 2. The 2019 water and sewer rates per EDU were $47.32 and $31.75 per EDU per month, respectively. The water and sewer target rates per EDU are $45.57 and $29.30, respectively. The combined sewer and water rate is $79.07 per EDU per month which is 106% of target rate; therefore, Conrad currently qualifies for a $500,000 TSEP Grant. TSEP Grant eligibility is based on post project rates which have been established and summarized in the following table. Table 13 – Summary of Rates

% of Target Rates Water Sewer Combined Rate Target $45.57 $29.30 $74.87 NA Current $47.32 $31.75 $79.07 106% Anticipated Increase $0.00 $9.07 $9.07 NA Post Project $47.32 $40.82 $88.14 118%

The City will exceed the target rates by 118% once the project is complete. The City qualifies for a $500,000 TSEP grant. Community Development Block Grant (CDBG) CDBG is a state funded grant program administered by the Montana Department of Commerce. CDBG provides financial assistance to local governments for rehabilitation of infrastructure and facilities that primarily benefit low to moderate income Montana’s. CDBG provides grant funds of up to $450,000 for any single project, with a required match of 25%. The match can come 2020 Storm Water PER City of Conrad 55

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from numerous other sources including other grants, loans, or cash. To be eligible for CDBG funds the project must benefit at least 51% low to moderate income Montana’s. Conrad is not eligible for a CDBG grant. Renewable Resource Grant and Loan Program (RRGL) The Renewable Resource Grant and Loan Program (RRGL) is a state program that is funded through interest that accrues on the Resource Indemnity Trust Fund and the sale of Coal Severance Tax Bonds and is administered by the Montana Department of Natural Resources and Conservation (DNRC). Grants of up to $125,000 are awarded for projects that conserve, manage, develop, or protect Montana’s renewable resources. State Revolving Fund (SRF) The State Revolving Fund (SRF) provides low interest loans for both water and wastewater projects through the Drinking Water State Revolving Fund (DWSRF) and the Water Pollution Control State Revolving Fund (WPCSRF), respectively. The SRF program is administered by the Montana Department of Environmental Quality. Loans are offered at an interest rate of 2.50% for 20 years, though shorter loans can be obtained. The SRF program also offers principle forgiveness for their loans which is administered as funds are available. The City of Conrad will pursue an SRF loan. USDA Rural Development (RD) RD administers water and wastewater grant and loan programs to municipalities to assist in the development of essential community facilities in rural areas and towns. All applicants with a population of 10,000 or less are eligible. Applicants with low populations and low incomes will receive a higher percentage of grants. Priority is given to projects located in a community with a population of 5,500 or less. Grant eligibility and loan interest rates are based on the community’s median household income and user rates. The census data obtained from the most recent decennial census is used to determine both population and income. Grant assistance may be available for a portion of the grant-loan package. Grant funding limitations are based on population and income, economic feasibility, and availability of funds. The following summarizes RD grant eligibility: • MHI> $47,757 Not Eligible • $47,757>MHI>$38,206 Eligible for up to 45% Grant • MHI<$38,206 Eligible for up to 75% Grant For the City to be eligible for an RD grant 30% of the total project cost must come from other funding sources. RD typically requires 1 annual payment be held in reserve which can be applied to the last payment. The City may also consider pursuing more non-traditional forms of grants and financing including a State and Tribal Assistance Grant (STAG), which is a line-item appropriation in the federal budget, generally sponsored by one of the two Montana Senators, and a Water Resource Development Act (WRDA) Grant administered by the U.S. Army Corps of Engineers.

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Bonds Grants and loans may not be available to cover all the projected costs of the facility. In this case, the City’s local share can be provided by loans secured by general obligation or revenue bonds, or cash provided by current rates. General obligation bonds for water facilities construction are usually retired by property taxes and therefore are recommended only when the improvements will result in increased property value or provide benefits in direct proportion to the value of the property. The mechanics of financing improvements under general obligation bonds are relatively simple. A cost estimate prepared by the engineer is used to determine the amount of the bond issue; an election is held, and, if the issue is authorized by the voters, the bonds are offered for sale. The money for construction is obtained prior to the time the project is undertaken. This method of financing considers the improvements to be of general benefit to all property. This type of bond generally carries a lower interest rate than revenue bonds, thereby lowering user costs. Revenue bonds are repaid solely from revenues derived from the facility. There is generally no legal limitation on the amount of bonds that may be issued, but there is a practical limitation in that excessive offerings are not likely to attract bids from responsible buyers. Furthermore, to entice a bond buyer’s interest in the market today, an attractive bond coverage factor of 125 percent is required. Interest rates are generally higher for revenue bonds. Higher interest rates along with required coverage factors will increase user costs. In some instances, public facilities are financed partly by general obligation bonds and the balance by revenue bonds. By properly apportioning the two, an equitable financing setup can often be created. In this manner, conditions are more favorable for the governmental body to finance the system while relieving, to some extent, the financial restrictions on the system, had it been entirely backed by revenue bonds. A special form of general obligation is a Special Improvement District (SID) wherein a special district is formed in the area of the improvements and the property owners are obligated to repay the project costs or a portion. These generally work well for street improvements, sidewalk installation, lighting, etc. The following table summarizes the funding strategy and total project costs.

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Table 14 – Funding Strategy

Funding Source Item Total TSEP SRF Loan Local Administration Personnel Costs $1,000 $1,000 Office Costs $1,000 $1,000 Grant and Loan Admin $15,000 $15,000 $30,000 Legal Costs $3,500 $3,500 Audit Fees $3,000 $3,000 Travel & Training $500 $500 Loan Origination Fees $0 Interim Interest $0 Loan Reserves $170,000 $170,000 Bond Counsel $10,000 $10,000 $20,000 Total Administrative $27,500 $198,500 $3,000 $229,000 Construction Related Activities

Preliminary Engineering $30,000 $30,000

Engineering Design $244,000 $244,000 Construction Engineering $244,302 $244,302 Services Construction $200,000 $2,019,556 $2,219,556 Contingency $28,500 $193,456 $221,956 Total Construction $472,500 $2,457,314 $30,000 $2,959,814 Activity Total Project Budget $500,000 $2,655,814 $33,000 $3,188,814

For this evaluation we will assume that the cost of the improvements will be shared by the entire City of Conrad through an increase to the sewer rates. The impact on the sewer rates as a result of the project can be estimated but cannot be determined exactly. This is primarily since the exact effect on existing sewer rates is dependent on the success of future grant and loan applications and the success of an East Side Area SID. To estimate the increase in user fees, the debt service and the increase in O&M must be considered. The estimated debt service based on a $2,655,814 twenty-year SRF loan at an interest rate of approximately 2.5% is approximately $170,000 per year or $14,200 per month. There is no expected increase in O&M costs as a result of the project. The total number of EDU’s is 1,561 as presented above; therefore, the additional cost per EDU is $9.08 ($14,166/1,561). It is expected that Conrad will apply for a $500,000 TSEP grant and a $2,655,814 SRF Loan.

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6.6.4 Reserves The loan reserve amount will vary depending on the amount the City must borrow and the lender’s requirements. It is anticipated that an SRF loan will be pursued in the amount of $2,655,814. SRF typically requires 1 annual payment be held in reserve. We anticipate approximately 170,000 per year to service the debt based on 20-year loan at 2.5% interest.

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7 CONCLUSIONS AND RECOMMENDATIONS The City of Conrad has an existing storm water system for the West Side of the City but the East Side, the lowest area of town, does not have a storm water system and experiences significant drainage problems even during the smallest storm events. Also, it has been determined that storm water is draining into the wastewater system. Once the storm water enters the wastewater system it gravity flows to the lift stations, and eventually to the City’s mechanical wastewater treatment plant (WWTP). The storm water in the wastewater system results in wasted energy, unnecessary wear and tear on the lift station and the WWTP, increased operations and maintenance requirements, and E Coli violations. According to DEQ Circular 2 – Design Standards for Public Sewage Systems, “Sewers must be designed for municipal wastewater only. Rainwater from roofs, streets, and other areas, and groundwater from foundation drains must not be permitted in municipal wastewater sewers.” To help limit the amount of storm water entering the wastewater system and to address the flooding experienced at the East Side of the railroad tracks it is recommended that Conrad move forward with implementing the West Side Improvements and the East Side Improvements Alternative 4 - East Side Area Storm Drain System No Curb and Gutter. Failure to address these issues will continue to result in flooding problems during the smallest rain events, wasted energy, unnecessary wear and tear on the lift station and the WWTP, increased operations and maintenance, and E Coli violations. Addressing the storm water problems is also anticipated to result in economic benefits by increasing property values and tax base. The grant and loan application and award process can take several years before funds are obligated. It is recommended that the City move forward with grant and loan applications as soon as possible.

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Appendix A – Environmental Information

2020 Storm Water PER City of Conrad Appendix A

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Appendix B – Correspondence with Affected Agencies

2020 Storm Water PER City of Conrad Appendix B

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Appendix C – Census Information

2020 Storm Water PER City of Conrad Appendix C

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Appendix D – Public Engagement

2020 Storm Water PER City of Conrad Appendix D

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Appendix E – DEQ, NOAA, and WWTP Information

2020 Storm Water PER City of Conrad Appendix E

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Appendix F – Financial Information

2020 Storm Water PER City of Conrad Appendix F