From Kevin Duggan writing on the opinion pages of The Fort Collins Coloradoan:
The cost of a water-storage project Fort Collins has been pursuing for more than a decade continues to float higher and higher.
But even at its current estimated cost of $74.1 million — $27.3 million more than estimated just a few years ago — city officials say expanding Halligan Reservoir along the North Fork of the Poudre River remains the city’s best and most affordable option for securing future water supplies that would be needed in the event of drought.
That’s a big-ticket item by any measure. The cost would be covered by reserves in a fund that gets money from water rates paid by Fort Collins Utilities customers and fees charged to developers for tapping into the city’s water system.
Those development fees could go up 23 percent in coming years to help pay for Halligan, according to a memo to City Council…
Part of the reason for the project’s rising cost estimates is the uncertainty that comes with going through the National Environmental Policy Act process. The current projected cost includes $16.3 million in contingency funds to cover potential surprises in federal and state requirements for permitting and mitigation.
Fort Collins has been working on and paying for an Environmental Impact Statement, or EIS, for the proposed expansion of Halligan for 12 years. The latest estimate for when a draft EIS for the project will be released by the U.S. Army Corps of Engineers is April 2019, said Adam Jokerst, the city’s project manager.
Construction costs have gone up over the years and continue to rise. If the project is permitted, construction on the expansion, estimated to cost $31.3 million, could begin in 2023 and be completed in two years.
It would be quite an effort. The city has proposed enlarging Halligan’s capacity from 6,400 acre-feet to about 14,525 acre-feet by raising its concrete dam 25 feet…
The Halligan project has faced a lot of issues over the years. For a time, the EIS process included the city of Greeley’s proposal to expand its Milton Seaman Reservoir, which also is on the North Fork of the Poudre. Greeley wanted to expand its 5,000-acre-foot reservoir to 53,000 acre-feet.
The Halligan-Seaman project included the cities in partnership with North Poudre as well as the Fort Collins-Loveland, East Larimer County and North Weld County water districts, also known as the Tri-Districts.
The Tri-Districts backed out of the project in 2009, citing mounting costs and a lack of progress on environmental studies. North Poudre withdrew in 2014 over the same concerns.
Those withdrawals required scaling back the project, changing its environmental impacts and adding time to the review process, Jokerst said. There’s also been a lot of turnover at the Corps over the years with personnel overseeing the EIS.
The Seaman project was separated from Halligan in 2015 because of changing scopes for the projects and differing time frames. Greeley is now proposing to expand Seaman to 88,000 acre-feet to meet its water supply needs to 2065, according to the Corps’ website.
Fort Collins officials maintain the Halligan project still makes sense for the city even with its escalating costs. It makes use of an existing reservoir and could potentially improve flows on the North Fork through mitigation. The city has the water rights it needs to fill the reservoir, Jokerst said.
And Halligan is still less expensive than other water supply sources, according to the city. The going rates for an acre-foot of firm yield from the Colorado-Big Thompson project is $60,000. Under current estimates, water from the Halligan project would cost $8,800 per acre-foot.
So far, Fort Collins Utilities has spent $12.6 million on the project. The city has appropriated $37.4 million for it and would have to come up with another $36.7 million under current projections.