$40M proposal to solve Saipan’s sewage crisis

A New York City-based company is proposing to put up a $40-million investment to fix Saipan’s “crisis-level” sewer problem.

Hydro Management Resources Inc. managing director Mark Stone, in a Dec. 24, 2004 letter to Gov. Juan N. Babauta, described Saipan’s sewer situation as “an environmental crisis that jeopardizes the health of residents and visitors.”

“It is not extreme to describe the current situation as an environmental crisis. …Conditions are such that there is the very real possibility that a resident or tourist could be seriously stricken, perhaps even fatally,” he said.

Stone said his team visited Saipan last October to inspect the island’s two main wastewater treatment plants: Sadog Tasi facility and the Agingan Ocean Outfall.

Based on the observation, he said, the effluent being discharged from these two facilities are hazardous.

Needless to say, he said, the situation poses an “unacceptable risk” not only to public health but also to the island’s tourism industry.

“A single incident would create permanent damage to the CNMI tourism industry—a concern we believe is shared by the management of all major hotels on Saipan,” said Stone.

Given the seriousness of the problem, he said it is imperative to move quickly to upgrade both the central treatment plants and the collection infrastructure.

He said his company, together with Zenon Environmental, can help the CNMI address the critical wastewater infrastructure improvements.

The project would include the repair and retrofit of the Sadog Tasi and Agingan plants, which includes capacity expansion and addition of tertiary filtration through the installation of Zenon membrane bioreactors, and addition of dentrification, repurification of wastewater plant output, and disinfection.

HMR said that up to 75 percent of wastewater would be converted to re-purified water suitable for distribution and human consumption.

The estimated capital cost of its projected scope of work totals $40 million under a Build-Own-Operate scheme.

HMR aims to recover costs through charges for wastewater treatment and sale of re-purified water.

Estimated cost is $4.85 per 1,000 gallons of wastewater treated, excluding recovery of the costs of the capital improvements to the collection system and pumping stations.

It is based on average daily volume of treated wastewater at 5 million gallons, which is estimated to yield 3.5 million to 3.75 million gallons of purified water.

Stone, in the letter, said that while HMR is capable of and prepared to advance all the funds necessary to complete the work, the total cost would be “prohibitive without some degree of federal government support.”

Stone hopes that the federal government would “offset sufficient costs so that we can offer our services at a commercially viable level.”

HMR aims to enter into a sole-source emergency negotiations with both the CNMI government and the Department of the Interior.

“We hope the significant private sector financial commitment by HMR and clear urgency of the situation will combine to make the federal government assist in offsetting sufficient costs…,” said Stone.

The Commonwealth Utilities Corp. is lobbying the Legislature to pass a bill calling for the immediate reprogramming of $3.3 million for the federally mandated construction of the Agingan Ocean Outfall.

Failure to act on the proposed measure within the month would result in CUC having to pay $35,000 in daily penalties per violation.

The U.S. Environmental Protection Agency told the CUC about the need to identify funds for the critical repair the Agingan plant since over three years ago.

In related developments, the government floated the idea last year of freeing the CUC from water and wastewater responsibilities.

The CUC board of directors, in particular, adopted a resolution urging the Babauta administration to propose to the Legislature an amendment to the CUC Act to remove the water and sewer operations from the utility firm.

This would leave the CUC with the management of power generation and distribution—the only money-making branch of the corporation.