Clock running, costs rising on Fort Smith sewer work, officials say

FORT SMITH -- The city needs to spend at least $65 million a year, on average, through 2032 to comply with an agreement it made with federal and state environmental officials to fix its sewer system, according to figures provided by city officials.

And that's if it doesn't borrow money for the work, which would add interest, according to City Administrator Carl Geffken.

"That's been our contention with the Department of Justice and the EPA, is that with all the different resources we've got, we still anticipate we'll have more expenses than we'll have resources," Deputy City Administrator Jeff Dingman said late last month.

It's been just over eight years since the city entered into the consent decree in January 2015, and 35 years since the work first started on sewer system repairs.

Fort Smith entered into the decree with the U.S. Department of Justice, the federal Environmental Protection Agency and the Arkansas Division of Environmental Quality. In the decree, the city acknowledged it allowed untreated sewage to flow into waterways, including the Arkansas River, for decades.

The EPA is limited in the specifics it can give in ongoing litigation, spokeswoman Jennah Durant of the agency's regional office in Dallas, said in a statement Friday when asked about the environmental and human impacts of sewage overflows.

"Untreated sewage contains organic matter, bacteria, viruses, parasites, toxics and metals, which can cause illness and even death when humans come into contact with it," according to the statement.

"Children, the elderly and individuals with compromised immune systems are particularly vulnerable to becoming ill when exposed to sewage. Sewage is high in organic matter, and it requires high levels of oxygen to decompose in waterways and can deprive aquatic life of the oxygen needed to survive. If untreated sewage makes it to a waterbody it can cause or contribute to that waterbody not meeting its water quality standards and designated uses such as fishable and swimmable," the statement says.

The Arkansas Division of Environmental Quality also confirmed Friday it doesn't comment on ongoing litigation.

The city so far has sought t0 delay the decree deadline, but wasn't successful in its latest attempt. And, as Geffken and others like to point out, each delay, even if granted, runs up the costs.

Geffken said in order to meet the 2032 deadline, the city would have to spend upward of $65 million each year. He said the Utility Department's entire annual revenue is roughly $60 million.

If the city had to borrow money, even at a reduced rate through government programs, the consent decree would cost $36.4 million a year over a 30-year period, or spending a billion dollars for $635 million worth of work.

The city also allocated $15 million in American Rescue Plan money for water and consent decree work, with the majority of that money spent on the consent decree.

A recently approved sales tax for the work is expected to raise about $16.5 million this year and at least that amount in subsequent years.

Lance McAvoy, the city's utilities director, said the city would have had to increase sewer rates 58% to 60% almost immediately to comply with the agreement if the sales tax wasn't approved.

"Our issue is one of that's still an awful lot of money we need to spend," Geffken said. "It was $635 million, but of course with inflation and difficulty and supply chain issues, it's like a clock that keeps ticking, and the cost keeps rising."

City Growth

Mayor George McGill said Fort Smith is poised for growth in his state of the city address in March. He said the city had a good relationship with the EPA and would continue to address the wastewater systems problems.

The Foreign Military Sales Pilot Training Center program picked Ebbing Air National Guard Base at Fort Smith Regional Airport for as its pilot training center for Singapore and other countries participating in the program. The program would accommodate up to 24 foreign Lockheed Martin F-35 Lightning II aircraft and move 12 General Dynamics F-16 Fighting Falcons from the Singapore Air Force, currently at Luke Air Force Base in Glendale, Ariz. McGill estimated the economic impact of the training center program would be from $800 million to $1 billion.

McGill also noted recent expansion in the health care field, including Mercy Hospital's more than $160 million expansion at its Fort Smith location.

The Fort Smith Regional Chamber of Commerce had no comment on what, if any, economic impact the ongoing problems with the wastewater system could have.

The decree

The city agreed in 2015 to spend more than $200 million over the next 12 years to upgrade its sewer collection and treatment.

The decree states Fort Smith owns and operates 500 miles of sewer lines and 23 pump stations. It said the city violated Section 301 of the Clean Water Act, which limits how much of a certain pollutant an entity is allowed to discharge into a water body.

The city's violations include frequent discharges of raw sewage to the Arkansas River and failure to prevent sanitary sewer overflows through proper operation and maintenance of its system.

"We did do a lot of work and we were sharing the work that we were doing with the EPA and DOJ saying 'Hey, here's what we're doing.' And we really didn't hear a lot of feedback from them during that time frame until a new lawyer was assigned. I want to say it was around the end of 2013 and it really picked up in 2014 on trying to get a consent decree out."

Fort Smith had several administrative orders from the EPA between 1988 and 2005 to work on its sewer overflows.

McAvoy started working for the city's Utilities Department in 1996 and was promoted to director in 2019. Before the decree, the city was building smaller equalization basins to address overflows until it could able to build a larger pump station as the Massard Treatment Facility.

McAvoy said the EPA didn't like how Fort Smith was handling the administrative orders, telling the city it should be fixing pipes instead of collecting storm water from damaged pipes.

"So that was our thought, but I think from DOJ's perspective, looking back over case files, that it was just a matter of our history catching up with us," Geffken said. "Saying 'yeah, OK, but no. We've tried this route and it's not worked. You had a chance. You've had years and years and a prior consent decree.' So I think that is part of their decision-making process."

Geffken said the city spent roughly $192 million on work between 2001 and 2014, before the decree was enacted. He said since the decree, the city has spent roughly $133 million on utility work, or $325 million total.

Improvements

McAvoy said the city is working on capacity improvements for two sewage basins, which collect and hold wastewater before it's removed from the system by a pump.

"And then we have a major pump station upgrade at the Massard treatment plant. Those are very, very expensive projects," he said.

McAvoy said the pump station project will cost roughly $45 million.

It's hard to determine what percentage of decree work has been completed and what is left to do because the the city finds more work to do each year through annual assessments, he said.

The city has gone to court several times since the decree was signed to seek clarification and deadline extensions.

The city argued in the most recent filing engineering judgment should be used to determine which pipes to repair or replace and which to include in its maintenance program.

It lost at the district court and then at the appeals court level.

A three-judge panel of the U.S. 8th Circuit Court of Appeals ruled last year the decree specifies all projects be completed as soon as technically feasible, but no later than four years after a project was first identified, according to the case summary.

Geffken told city directors at that time the cost of the decree would have been reduced by an estimated $140 million if the city had prevailed.

The city asked for a five-year extension in 2020 on the decree arguing its progress was hampered by floods in 2015 and 2019, the covid-19 pandemic and inflation.

The original decree deadline was Jan. 2, 2027, but the city eventually was granted a five-year extension to 2032 by the federal court.

Geffken said going to court costs the city between $80,000 to $200,000 a year for lawyers and court fees. He said work for the decree by law firm AquaLaw PLC cost $73,184 in 2022.

City directors approved continuing services with AquaLaw during a meeting in December. At the meeting, McAvoy said roughly $376,000 has been spent to retain AquaLaw since 2016.

"The cost that we have spent is minuscule and has been really beneficial in keeping some of the other overall aspects within control," McAvoy said.

EPA response

Cheryl T. Seager, director of the Enforcement and Compliance Assurance Division of the EPA, told Geffken and McAvoy in an email Aug. 15, that while the EPA acknowledges covid was an extraordinary event that may have caused financial impacts to the city, the decree says the city's financial inability to meet its obligation isn't an excuse.

Other claims for seeking an extension lacked the specificity required under the agreement, she wrote.

Dalton Person, an attorney with Jones Jackson Moll and a Fort Smith School Board member, said it seems like there's no end in sight for the decree work. He said it's frustrating because it seems like the EPA is prioritizing renegotiating consent decrees with larger municipalities such as Kansas City, Mo., and St. Louis.

"It's the smaller communities like ours that these consent decrees really put a hamper on and are going to hurt us for an extended period of time," he said.

McAvoy said he wants to be compliant with the Clean Water Act while also allowing the city to grow.

"There's a balancing act on what we can do financially and what may be requested of us to do," McAvoy said. "I have faith. I work with EPA Division of Environmental Quality in Little Rock going back to 1991 when I worked in the private sector. And they're reasonable. They're knowledgeable people. I enjoy working with most of them."

Talicia Richardson, executive director of 64.6 Downtown and School Board member, said it's important for the community to know about the decree and its potential impact to their families.

"Anytime there's increases in the basic necessities, such as utilities, there could be an impact on that child having a home and having running water and things of that nature," she said. "I trust the community and the city of Fort Smith is going to be mindful of the implications on those that are below the poverty line or at the poverty line, and the impact on those families."

Geffken said the city is working to understand the DOJ's point of view while making headway with consent decree work.

"I do believe that if we work together by saying 'This is what we can do with these issues confronting us, and here are the steps that will be taken that address their concern,' I think they may be more willing to then take into account our concerns," Geffken said.

"I think we will get to that point and there will be more discussions to be had in the in the future -- I'm pretty sure probably this year -- and that we'll get to an agreement regarding what is equitable and fair for everyone."

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Read the decree at: rivervalleydemocratgazette.com/416consent/

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