12.06.22 FIN Poplar GMP1-2 rev 1 2022Dec06 — File 22-2017

Poplar Street Pump Station construction appropriation request City Council Finance Committee Mayor Katjana Ballantyne Richard E. Raiche, Director of IAM Demetrios Vidalis, Director of Water & Sewer Stephen Haynes, W&S Finance Director Ed Bean, Finance Director 6 December 2022

Outline • Project goals • Historical context • Problems created • Solutions offered • Project details • Infrastructure included • Schedule • Relation to ArtFarm • Financing • Rate impacts 2

Project goals Poplar Street Pump Station enables flood mitigation in Wards 2&3, supports CSO reduction, and unlocks development potential in 60% of the City 3

Historical background Poplar Street Pump Station solves a problem created in 1873 4

Millers River 1852 5 10 Poplar Street Somerville Combined Sewer & Drain

Millers River 1873 - 1879 6 10 Poplar Street Somerville Combined Sewer & Drain Metropolitan Sewer to Boston Harbor Rail Road Drainage to Charles Somerville & Cambridge Overflow to Charles

96-inch brick arch sewer 7

Somerville combined sewer & drain 8

Combined sewer subsystems 9 A: Alewife Western Ward 7 Clarendon Hill S: Somerville Marginal ASQ Gilman Square Winter Hill Lower Broadway C: Cambridge Branch USQ, Boynton InnerBelt, BrickBottom Eastern DSQ CA: Dry to C with Overflow to A Western DSQ, Teele, Tufts Ball/Magoun

Nexus of flows in low-lying, landlocked USQ 10 • Upstream flows create 3 problems

Problem 1: Flooding System capacity limitations cause surcharges 11

Legacy flooding problems 12

Problem 2: Combined Sewer Overflows System capacity limitations cause discharge of sewage to Alewife Brook, Mystic River and Charles River 13

CSO’s provide system relief 14 SOM- 007A SOM- 001A MWRA

Problem 3: Prohibitions on development MWRA and DEP require 4:1 stormwater offsets for new sanitary connections 15

USQ, Boynton, DSQ, InnerBelt & other building permits reliant on stormwater offsets 16 • 314 CMR 12: Requires 4 gallons of stormwater be removed from sewers for every 1 gallon of new sanitary flow • For developers: MEPA permit requirements for large developments (FRIT, US2, DLJ, etc.) • For Somerville: Annual reporting to MWRA of new connections and I/I removed • Must be by system • Without stormwater discharge, impossible to offset flows in Cambridge Branch system

MBTA drainage system provides new capacity A new solution to a 150-year old challenge 17

GLX MBTA drainage improvements • Designed to keep high-intensity flood elevations below top of rail • Opportunity! • Value in excess capacity during smaller storms 18

Railway unwilling 1873 - 2016 19 10 Poplar Street Rail Road Drainage to Charles

GLX in peril! • Delays • Cost increases • $600M - $934M - $1.3B - $2.3B - $4.3B! • 2015 – 2017 redesign

Somerville helped save GLX • Somerville negotiated drainage connection

Conditional export of stormwater • 50 million gallons per day maximum rate • Zero discharge when tracks flood • Poplar Street Pump Station design includes a storage tank to accommodate that condition and maximize benefit 22

Solution 1: Flooding Solves the root cause downstream constraint and facilitates all future flood mitigation projects 23

USQ projects in design and construction 24 Somerville Ave Utility & Streetscape Improvements (SAUSI) Nunziato Stormwater Storage Poplar Street Pump Station (Stormwater) Spring Hill Sewer Separation Union Square Streetscape & Plaza Pump Station Site

Importance of Poplar Street Pump Station and the new drainage connection 25 • Flooding in orange areas dependent upon new connection

Citywide Drainage & Water Quality Master Plan • Project summary • Presentation materials • Contact info • Detailed technical reports • Summary report 26 https://voice.somervillema.gov/citywide-drainage-and-water-quality-master-plan

27 Sewershed C2 - Existing Conditions Flooding 10-year, 24-hour storm event (total rainfall = 5.16 inches)

28 10-year, 24-hour storm event (total rainfall = 5.16 inches) Sewershed C2 - Flooding After Project Implementation

Solution 2: Combined Sewer Overflows Relieves capacity limitations that cause discharge of sewage to Alewife Brook, Mystic River and Charles River 29

Long Term Control Plan • Somerville, Cambridge & MWRA developing plan • DEP & EPA reviewing and approving plan • https://voice.somervillema.gov/cso-plan • https://www.somervillema.gov/cso • 2nd community meeting: Dec 15th • https://tinyurl.com/CSOmeeting2 30

Solution 3: Offsets for new development MWRA and DEP require 4:1 stormwater offsets for new sanitary connections 31

Hydraulic modeling results • Diverts 2.2 Billion gallons of stormwater from MWRA system to MBTA system in a typical year • 6 mgd average day • Provides offsets for development scenarios 32

Infrastructure enables development - tax base enables debt service & future budgets Somerville MWRA MBTA US2 MassDEP, EPA Tax Revenue Debt Service Transit-Oriented Development 50 MGD Capacity Flow Reduction Environmental Compliance Infrastructure

Transformation of USQ vital component of SomerVision A quick aside on the benefits of development 34

SomerVision & USQ Plan 35 Add public open space Increase commercial tax base Create jobs in Somerville Increase housing stock for all income levels Create multi- modal transportation network Improve stormwater & wastewater management • Advance sustainable mobility goals • Address legacy flooding issues • Add new public open space • Address housing crisis • Create local jobs • Reduce commutes out of and through Somerville • Expand commercial tax base to fund community priorities and create financial stability

Community-driven Development 36 Community Visioning & Planning Community- driven Development Structures and Spaces Housing, Parks, Public Spaces, Jobs Streetscapes, Mobility structure Tax Revenues Community Priorities Community Services

Outline • Project goals • Historical context • Problems created • Solutions offered • Project details • Infrastructure included • Schedule • Relation to ArtFarm • Financing • Rate impacts 37

Project details 38

Infrastructure at Poplar Street 39

Objective: Move stormwater from MWRA to MBTA 40 Existing connection to MWRA Cambridge Branch Sewer Proposed connection to MBTA track drainage system

41 Gravity connection to SAUSI culvert

42 Lift from MWRA to MBTA elevation ~17 feet

43 Force main connection to MBTA

44 Store stormwater when tracks flood MBTA condition for connection: stop pumping when tracks flood

45 Typical year and up to 10-year storm Stormwater from sewer separation areas exported to MBTA track drainage system

46 Extreme events Overflow to MWRA Cambridge Branch Sewer When MBTA tracks are flooded, pumping stops, and tank is full…

Schedule Construction Manager recommendation for precast concrete tank shortens schedule by 18 months and reduces costs by $8M 47

48 O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D Sewer Enterprise, Current Funding Authorization Request Stormwater Storage Tank Start-up, punch list, and closeout Stormwater Pump Station Start-up, punch list, and closeout Pipelines and Utilities Start-up, punch list, and closeout General Fund, Future Funding Authorization Request Streetscapes Start-up, punch list, and closeout ArtFarm Start-up, punch list, and closeout On-site construction 2022 2023 2024 2025 Pre-construction Pre-construction, fabrication Pre-construction, fabrication On-site construction Pre-construction On-site construction Final design Right-of-Way construction Final design Pre-con. Right-of-Way construction

Schedule commentary – Precast tank • Overall project critical path (illustrated in red): • Tank excavation & concrete surface restoration, ArtFarm activation • Schedule: Earliest start for ArtFarm construction winter 2024/25 • Plan: Initiate ArtFarm final design winter 2024/25 • Alignment of non-critical path components • Pump station duration similar to tank, with long lead times for equipment • Complete pipeline work early (eliminate unknowns, avoid escalation) • Schedule: Earliest start for streetscape construction summer 2024 • Plan: Initiate streetscapes final design winter 2024/25 • Funding requests • All sewer infrastructure – Fall 2022 • Streetscapes & ArtFarm – Winter 2023/24 49

Relation to ArtFarm The final phase of the project 50

Infrastructure designed to accommodate ArtFarm vision • Finalize ArtFarm design and integrate infrastructure access 51

Outline • Project goals • Historical context • Problems created • Solutions offered • Project details • Infrastructure included • Schedule • Relation to ArtFarm • Financing • Rate impacts 52

Financing Construction cost escalation and interest rate increases necessitate changes to rate increase forecasts presented for FY2023 53

Poplar Street financing strategy • Total project cost: $102 Million • Apply $10M from ARPA • Accept up to $2.5M federal earmark • Borrow remainder in tranches through bonding • Current request: • $89.333 Million bond authorization 54

Core financial model assumptions • Utility Funds receive $2M annually in stabilization contributions • MWRA cost will escalate at an average rate of 3-4% per annum • Capital investment plan utilizes debt financing • Future project costs escalated to reflect market factors • Interest rates on future borrowing are higher than prior year analysis given rising interest rate environment • Eligible future projects will leverage SRF program • Assuming 100% spending of operating and capital expenses 55

Prior Model: No ARPA Funds Sewer Fund Prior Modeling

Prior Model: No ARPA Funds Sewer Fund Revised Modeling

Prior Model: No ARPA Funds Water Fund Prior Modeling

Prior Model: No ARPA Funds Water Fund Revised Modeling

Prior Model: No ARPA Funds Kitchen Table Impact Preview * Total Change in Annual Costs for Various Billing Units (including base & volumetric charges, amended) Total Units per Bill (in CCF) FY 2023 FY 2024 $ Change Annual Total Annual Total (FY 2024 - FY 2023) % Change 15 (average condo unit) $919 $1,029 $110 12% 18 (average single family home) $1,118 $1,258 $140 12% 30 (average two-family home) $1,912 $2,170 $258 13% 42 (average three-family home) $2,707 $3,080 $373 14% 110 (average 8-unit apartment building) $6,583 $8,409 $1,826 28% *Note: Subject to change as team evaluates rate structure changes and FY24 budget

Assistance Programs • Low Income Housing Energy Assistance Program • Administered by the City of Cambridge • Federal Program to assist families up to 150% of the Federal Poverty Limit • 134+ Families have submitted for the assistance Program • 41C & 17D (Elderly) Exemptions • Administered by the City of Somerville’s Assessing Office • 25% off Water & Sewer Bills for all those who qualify • 64 of 17D applicants and 37 of 41C applicants (101 total) have qualified for FY22 • We are exploring additional options for targeted financial assistance and expanding our community outreach teams

Conclusion 62

In 2016, we started developing strategies to be proactive and achieve infrastructure- dependent goals 63

64

Challenge: Construction cost escalation and interest rate increases 65 Call to action: Continue strategic investment aligned with financial metrics that preserves capacity for other needs and priorities

Poplar Street Pump Station construction appropriation request