The City of Clinton is poised to spend the first of roughly $1.76 million in federal grant funds provided to front half the proposed cost of installing and upgrading necessary infrastructure to serve biofuels industry Chemtex on N.C. 24.
In order to meet grant guidelines, the city needs to begin infrastructure work along N.C. 24 by the summer of 2016. On Tuesday, City manager Shawn Purvis cited that fast-approaching timeline and recommended beginning in phases in order to preserve the grant and help move the project forward.
“We were fortunate enough to receive an EDA grant that covers half that project. We’re not quite ready to move forward with that project, but our EDA timeline is quickly approaching,” said Purvis. “If in six months we have not begun that project, we stand the risk of losing that grant.”
A U.S. Economic Development Administration grant in the amount of $1,758,150 was awarded to the city in June 2014 to construct water and sewer infrastructure to support the future Chemtex (Carolina Cellulosic Biofuels) plant, anticipated to bring 65 jobs and more than $150 million in taxable investment to the area.
Local funds will make up the other half of the roughly $3.5 million endeavor.
City staff, including Purvis, engineer Russell Byrd, Public Works director Jeff Vreugdenhil and others, worked to identify a “financially feasible” need that would allow the city to ease into the $3.5 million project while ensuring the grant funds stay intact.
Staff engaged The Wooten Company for input on potential components that could move forward without financial commitments from Chemtex. They found certain items that would “be of benefit to the city in the short term, and would maintain the viability of keeping the grant in place,” according to Vreugdenhil.
One particular project identified was the installation of up to 12 insertion valves within the existing water system, notably along the Southeast Boulevard corridor from north of Warsaw Road to south of Rowan Road.
“These valves would provide more reliability to the existing system and would diminish water service interruptions and boil water notices to the area,” Vreugdenhil stated. “Additionally the valves if installed would eliminate (the) need for valves in the future water plant expansion at far greater costs.”
The work was estimated to cost approximately $250,000. The 50/50 matching grant would mean that $125,000 would come from city funds.
“We’re talking about a very nominal amount when considering a $3.5 million project,” Purvis noted.
Purvis recommended Water and Sewer Fund reserves to begin the project. The city has $4.1 million in Water and Sewer reserves (87 percent), including $529,000 in capital reserves designated for N.C. 24 utilities relocation and the N.C. 24 Industrial Park.
“We felt that would be an easy benefit, easy to install and easy to start the project, reinforcing the existing system without undo outlay at this time,” Byrd said. “If there were to be breakages within the line, it would allow us to reduce the amount and impact of service interruptions along that corridor. Throughout the system, we identified the need for valves to reinforce the system’s reliability without actually installing more pipe.”
Mayor Lew Starling noted the number of business along the Southeast Boulevard (U.S. 701 Business).
“That is where most of our business and industry is located,” Starling attested.
The proposed Chemtex biorefinery would only add to that list.
Set to be located at a 40-acre site at Clinton Industrial Rail Park on N.C. 24, the refinery will make ethanol from plants other than corn, producing 20 million gallons per year of cellulosic biofuel from locally-grown energy grasses, agricultural residues and woody biomass. The plant would be the first commercial-scale, advanced biorefinery in the United States.
Byrd said the benefits would be present for the city and its businesses with the valve project, which Council subsequently approved.
“If there was a break, we can confine to a shorter span of the pipe and have less of an impact on customers,” Byrd added. “We felt that would be a good expenditure.”
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