Council awards $71,266,760.15 Phase 1 construction contract to S.J. Louis Construction of Texas

On October 24, 2023 the council voted 5-0 (Stanley, Craft, Tipps, Scherlen, Simpson; motion by Don Tipps, second by Josh Craft) to award S.J. Louis Construction of Texas, Ltd. a $71,266,760.15 construction contract for Phase 1 of the Amarillo Northeast Sanitary Sewer Interceptor project. Assistant City Manager Floyd Hartman presented the item. ^[1]

Phase 1 consists of about 13 miles of sanitary sewer pipe and the abandonment of an Imhoff tank and a lift station in the northeast basin. The memo says the lift station being abandoned serves the prison and nearby industrial park and pumps about 1 million gallons per day, which is pumped five more times before reaching the Hollywood Road plant; that previous studies showed this system to be overloaded per TCEQ requirements; and that the interceptor would move that flow by gravity to the River Road plant. It says the interceptor was a high-priority need in the 2012 Wastewater Master Plan and the Northeast Basin Study, and lists added service to the Centerport industrial area, growth and reduced pumping as long-term benefits. ^[2]

The award memo funded the contract with $47,440,125.00 available in project budget 530042 (water and sewer revenues) and $23,826,635.15 to be obtained through water and sewer revenue bonds, and said FY 23/24 utilities capital project funds would secure the full amount until the bonds were issued. ^[1][2]

Estimate at award: the memo said "The Northeast Interceptor is anticipated to be completed in the summer of 2025." NewsChannel10 reported Phase 1 was set to be complete in 2025. ^[2][3]

Assistant City Manager Floyd Hartman; Councilmember Les Simpson (as reported by NewsChannel10): Assistant City Manager Floyd Hartman told NewsChannel10 that the top end of the line "starts at Highway 60 out north by the airport" and that "it doesn't just impact the area where it's at, it impacts the entire city because it provides additional services." Councilmember Les Simpson called it "a much needed investment in our city's infrastructure," referring to it as the "Northwest Interceptor." ^[3]

The City's five-year Community Investment Program (CIP) gave an estimated capital expenditure of $25,226,000 for the Northeast Interceptor in the FY2020/21 edition (project 523203, "WWC North-East Interceptor," all in FY2020/21; PDF p. 114) and $26,170,825 in the FY2022/23 edition (project 530042, "NE Interceptor," all in FY2022/23; PDF p. 130), both from the Water and Sewer System Fund. The FY2021/22 edition has no Northeast Interceptor project page or summary line, and the FY2023/24 edition (dated November 2023) does not list the project. The Phase 1 construction contract the council awarded on October 24, 2023 was $71,266,760.15, about 2.7 times the FY2022/23 estimate. The CIP editions do not explain the difference. ^{[4][5][6][7][1]}

The FY2022/23 CIP says the year-one program approved through the 2022/2023 budget included $57.8 million of debt, $46.5 million of it water and sewer utility bond proceeds, and that "the bulk of the water and sewer utility bonds are encompassed by three projects; the Northeast Interceptor Sewer line for $26.2 Million, the Water Rights Expansion project for $18 Million, and the Arroyo Outfall sewer line ... for $2.3 Million." ^[6]