COEUR d'ALENE - It could go to a vote.
Coeur d'Alene's legal department said Wednesday it's recommending the city hold an election to get approval to pay for up to $36.3 million worth of federally mandated improvements to its wastewater treatment plant - a move that comes in response to one councilman's pledge to tie the matter up in court if the city didn't ask voters.
Staff has crafted a proposed bond ordinance that it will ask the City Council to approve during a special meeting at noon today that would put the issue before voters on May 21.
It means the council could decide on whether to hold an election on wastewater treatment plant upgrades before it even knows the fate of its judicial confirmation - the way it originally sought to secure the money to pay for the project.
"It could put us in an unfortunate situation if a judge rules it's ordinary and necessary, but we're" putting on an election instead, City Attorney Mike Gridley said, calling such a scenario a "waste of time and money."
Yet, staff is recommending the city go the election route because time is tight.
The deadline to notify Kootenai County that the city intends to hold an election is Monday.
The city had thought it had more time, but the state Legislature just recently extended election notification times from 45 days to 50 days, shortening the timeline just enough to push the issue to the City Council a week earlier than expected.
The city had originally sought permission for the loan from a judge through a judicial confirmation. But City Councilman Steve Adams, who originally voted in favor of that route, changed his mind and spoke out against it in court. He prefers an election, he said, and pledged to appeal the judge's decision if it ruled in favor of the city.
"What's the urgency?" he said Wednesday of securing funds through confirmation, rather than through a vote a couple of months later.
He pointed to the fact that the compliance schedule to get on board with the new federal requirements hasn't been established yet.
"There's never been anything solid, 100 percent, 'you get this done by this time' - that's never been the case," he said.
But a change in plans could affect financing.
The city had been ready to secure a $7.7 million IDEQ loan at a 2 percent interest rate to pay for the first phase of upgrades to the plant, a rate the city's finance department said it wanted and likely couldn't get on the open market. The interest rate on the proposed bond issue, according to the drafted ordinance, is estimated at 3.24 percent.
The city has also penciled in $75,000 for election-related costs, including campaigning on its behalf.
Councilman Mike Kennedy said Wednesday he's not abandoning hope for getting approval through the courts despite the recent shift in direction heading into the special meeting today.
"I'm an optimist that we won't have to go to an election because the judge will rule in our favor and Steve will see the light and not appeal," he said. "That would be the best-case scenario."
First District Judge John Luster still had the judicial confirmation under advisement as of Wednesday afternoon, although a ruling had been expected by Wednesday.
Adams, who was reviewing the proposed ordinance language Wednesday, said he could be willing to wait until a November election if he feels the language isn't correct before deadline, or if the issue fails in May.
He said he would expect the agencies involved to continue to work together if Coeur d'Alene has to wait until November, and has called possible federal penalties like fines and moratoriums "rhetoric."
Adams is correct in that hard compliance deadlines haven't been established.
They are very close to being completed, however, those involved said.
Here's how the remaining schedule could shake out: The Idaho Department of Environmental Quality will likely send a 401 certification to the EPA in about two weeks. Once it's in the EPA's hands, and changes to the draft permits aren't needed, the permits will be opened for public comment for up to 60 days. If changes aren't warranted after public comment is taken, final permits should be issued.
That could be months out yet, Coeur d'Alene, IDEQ and EPA officials told The Press.
But once the final permits are issued, the compliance schedule starts. The compliance schedule is spread out over 10 years, with dischargers needing to hit benchmark requirements in year increments along the way.
The first benchmark is exactly one year after the permit is issued. And while it's a 10-year timeline, the final benchmark includes two years of data reported with it.
If compliance isn't met, fines for not complying could hit around $1 million a month, and the EPA could prohibit new development from tapping into the wastewater plant system.
The draft permit also outlines punishment for "knowing violations" - basically for dischargers who willingly thumb their noses at the new standards.
That's a criminal violation that could earn the culprit fines and up to three years in jail.
"I don't do felonies," said Sid Fredrickson, wastewater superintendent, who called waiting for a November election - should the measure fail in May - "uncomfortably" close to when final permits could be issued and the compliance schedule starts.
Adams hasn't said he favors ignoring the new standards, just that he prefers putting the funding issue to a vote.
Ultimately, the IDEQ signs off on the compliance schedule.
John Tindall, IDEQ engineering manager, said he couldn't speculate on what the agencies would do if the permits were issued - essentially starting the compliance clock - and all the dischargers had their funding secured save Coeur d'Alene, which was waiting for a November election.
It could warrant a meeting with those involved to see what steps would have to be taken, he said.
"That would throw a lot of things in question," Tindall said. "If (an election) fails, how do they proceed from there? They still have to comply ... That's not going away."
An election would be a 180 degree turn from where the city had been headed, asking for a judicial confirmation in light of the mandate and severe fines.
A judicial confirmation is when a judge orders a project is "ordinary and necessary," and therefore voter approval isn't necessary for a municipality to take on debt to fund it as it normally is because the project must happen.
The city achieved a $15 million judicial confirmation for plant upgrades in 2007.
The city of Hayden recently secured around $18 million for upgrades planned with the new requirements, and Post Falls is in the process of requesting confirmation from a judge.
When Adams changed his mind unbeknownst to the rest of the members, it isolated him from the rest of the council on the legal issue. Adams took exception to being excluded from legal talk on the matter, and tempers have flared at a pair of public meetings, including the use of swear words, a filed complaint and alleged threats.
The majority of the council, however, doesn't side with Adams, who cites the Idaho Constitution that outlines debt protocol as his reason to pursue the election route.
They said they're frustrated because the last-minute change of mind could sidetrack a process that has been years in the making. The last time the permits were up for public comment was 2007, and a lot, including a court case, has happened since then. They've said the timing on the issue is especially bad because everyone involved is on the brink of agreement, and campaigning for wastewater upgrades could be an unglamorous, if not difficult, sell to the public on short notice. Judicial confirmations, they point out, are legal.
Worse, they've added, is if an election or two fails, and the compliance schedule kicks in, a way to pay for the upgrade could be increased wastewater rates.
If they wanted to pay for upgrades over five years through rate increases, residential monthly bills would increase from around $24 to $70, and commercial would go from roughly $7 to $20 per thousand gallons.
Voter approval on the election would be a simple majority.
Today's meeting is at the public library.