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Proposed Major Stormwater Reuse Scheme Agenda Item 5.1 COUNCIL REPORT 15 December 2009 PROPOSED MAJOR STORMWATER REUSE SCHEME Committee Eco-City Presenter Cr Oke Purpose 1. The purpose of this report is to advise Council on a proposal for a major stormwater reuse scheme in Fitzroy Gardens, Treasury Gardens and Birrarung Marr and seek support for a Federal funding application for a portion of the works. Recommendation 2. That Council: 2.1. endorse the submission of an application for Federal Government funding from the ‘National Urban Water and Desalinisation’ Program (“the Funding”); 2.2. note that participation in the ‘National Urban Water and Desalinisation’ Program will require additional expenditure by the Council; 2.3. note that substantial expenditure will also arise with the redevelopment of the Fitzroy Gardens depot which will be required to expedite the project; and 2.4. request a report back to the Finance and Governance Committee on determination of the funding application outcome outlining final costs to Council. Council Report Attachment: 1. Eco-City Committee, Agenda Item 5.2, 1 December 2009 Page 1 of 5 ECO CITY COMMITTEE REPORT Agenda Item 5.2 1 December 2009 PROPOSED MAJOR STORMWATER REUSE SCHEME Division City Design Presenter Prof Rob Adams, Director City Design Purpose 1. To advise the Committee on a proposal for a major stormwater reuse scheme in Fitzroy and Treasury Gardens and Birrarung Marr and seek support for a Federal funding application for a portion of the works. Recommendation from Management 2. That the Eco City Committee recommend Council: 2.1. endorses the submission of an application for Federal Government funding from the ‘National Urban Water and Desalinisation’ Program (“the Funding”); 2.2. note that participation in the ‘National Urban Water and Desalinisation’ Program will require additional expenditure by the Council; 2.3. note that substantial expenditure will also arise with the redevelopment of the Fitzroy gardens depot which will be required to expedite the project; and 2.4. request a report back to the Finance and Governance Committee on determination of the funding application outcome outlining final costs to Council. Background 3. Funding is potentially available through the Federal Government’s Water for the Future ‘National Urban Water and Desalinisation’ Program (“the Program”) to undertake a major stormwater reuse scheme targeted at meeting the irrigation needs of significant parks and gardens located in the East Melbourne area (Fitzroy Gardens, Treasury Gardens and Birrarung Marr). 4. The proposed reuse scheme would incorporate elements which are described in the Fitzroy Gardens masterplan review (still to be considered by Council). Key Issues 5. Under the terms of the Program, project funding is capped at 50 per cent of eligible capital costs. The minimum project size is $4 million. While there is no maximum project size, funding is capped at $20 million (GST exclusive) per project. The balance of the project budget must therefore be funded by the Council. In order to be eligible projects must be completed by no later than 30 June 2013. Page 2 of 5 6. Investigations in and around the Fitzroy and Treasury Gardens and Birrarung Marr have indicated that significant opportunity exists to divert stormwater from the surrounding drainage system. The concept design developed to date proposes to divert stormwater from the Parliament, East Melbourne and Jolimont precincts and store it at key locations under the Fitzroy depot and the middle terrace at Birrarung Marr. Recycled water would then be used for irrigation purposes in the associated parkland areas by the City of Melbourne. 7. Concept design undertaken to date suggests that water volume available could meet up to 70 per cent and 87 per cent of the annual irrigation needs of Fitzroy and Treasury Gardens and Birrarung Marr respectively. This equates to a total potential saving of 92ML of potable water annually. This amount may be increased through active management of winter irrigation. The current functional design cost estimates are approximately $6 million for both projects. 8. Fitzroy and Treasury Gardens are on the Victorian Heritage Register which therefore limits the level of allowable landscape change in the Gardens. Early discussions with Heritage Victoria have indicated their in-principle support to the sensitive implementation of a stormwater capture and reuse scheme that will preserve the health of the gardens. In order to progress with the submission it will be necessary to obtain a formal letter of support from Heritage Victoria. 9. As with any stormwater reuse project it is necessary to obtain a diversion licence from Melbourne Water. Given the strategic significance of the project Melbourne Water have been made aware of the preliminary design and have indicated their in-principle support of the scheme. In order to progress with the submission it will be necessary to obtain a formal letter of support from Melbourne Water. Detailed discussions regarding a diversion license will be made once funding is confirmed and the detailed design phase commences. 10. The functional design for the Fitzroy and Treasury Gardens project includes a large underground tank beneath the current depot. It is intended that the depot be rationalised as part of these works to reduce its footprint in Fitzroy Gardens, thereby returning valuable parkland to public use. The cost of the depot demolition and re-construction cannot be included in the funding submission and is not part of the $6 million estimate. Therefore, the Council should note that there will be an additional significant cost for the depot works if the project proceeds. These costs are as yet unknown since they are dependent on the final masterplan for Fitzroy Gardens approved by Council. Time Frame 11. The Funding is subject to a set of criteria which must be met by the proposal. The closing date for submissions is Wednesday 10 February 2010. The public announcement of successful grant submissions is anticipated in April 2010. A fundamental requirement for any project to be successfully considered is its ability to progress detailed design stage to construction without delay. Relation to Council Policy 12. The City of Melbourne’s drought proofing initiatives for parks and gardens includes the investigation of possible opportunities to capture, treat, store and reuse stormwater from urban catchments. This project draws on conceptual modelling undertaken for a number of projects over the past two years, including the ‘Total WaterMark – City as a Catchment’ strategy. The project is also included under KSA 4 - Drought Proofing and Water Security and this has provided for the concept and functional design to be progressed to a suitable stage to form the basis of the funding submission. Consultation 13. Relevant stakeholders including Heritage Victoria, Melbourne Water and City West Water have all been made aware of the project and have indicated a willingness to support the scheme in principle. 2 Page 3 of 5 Government Relations 14. Funding to deliver the scheme is being sought from the Federal Government’s ‘National Urban Water and Desalinisation’ Program. Permits from relevant Victorian State Government agencies may be required Finance 15. The current functional design cost estimates are approximately $6 million for both projects. Therefore the maximum potential external funding from the Commonwealth would be $3 million. However this is not guaranteed and the amount could be less then the maximum 50%. If the funding is approved, council capital funds would be sought from the 2010-11, 2011-12 2012-13 budgets in order to complete the project by 30 June 2013. 16. One of the proposed projects requires a tank to be located underneath existing buildings within the current depot area. Associated works involving the removal and later re-instatement of buildings in the depot cannot be included in the grant application. It is expected that the costs associated with the removal and re-instatement will be a significant additional cost to Council should the project proceed. At this stage a reliable estimate of the costs is not available. The final cost will depend upon the Masterplan for Fitzroy Garden, yet to be approved by Council. Conflict of Interest 17. No member of Council staff, or other person engaged under a contract, involved in advising on or preparing this report has declared a direct or indirect interest in relation to the matter of the report. Legal 18. Legal advice has and will continue to be provided in relation to the recommendations from Management. Sustainability 19. The project represents another major stormwater capture and reuse project for the municipality with the potential to deliver water reuse outcomes on a similar scale to the Royal Park Wetlands scheme. The proposed scheme will meet three years worth of Council’s annual stormwater quality improvement targets and make a large contribution to councils 90 per cent potable water conservation target by 2020. In order to meet the requirements of the Federal funding the scheme will be designed to be carbon neutral. Plans for the scheme to also incorporate an interpretive component will ensure that it contributes to a broader understanding of the benefit of stormwater capture and reuse within the community. 3 Page 4 of 5 Agenda Item 5.2 Eco-City Committee 1 December 2009 FINANCE ATTACHMENT PROPOSED MAJOR STORMWATER REUSE SCHEME The financial implications are discussed in the body of the report. The minimum level of funding from Council, subject to successful application to the Federal Government’s National Urban Water and Desalination Program would be $2 million. Any proposed expenditures relating to 2010/2011 financial year or beyond would be subject to the normal budget approval process. Phu Nguyen Acting Manager Financial Services Page 5 of 5 Agenda Item 5.2 Eco-City Committee 1 December 2009 LEGAL ATTACHMENT PROPOSED MAJOR STORMWATER REUSE SCHEME Legal advice has and will continue to be provided in relation to the recommendations from Management.
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