With Vero hoping to break ground in August for its new wastewater treatment facility at the airport, Utilities Director Rob Bolton has taken a hard look at plans and decided paying interest on a solar panel system for 30 years to save a tiny amount on electricity does not make financial sense.

Bolton told the City Council he had initially hoped to get a federal grant or subsidy for solar panels, and did not contemplate having to finance them in the plant’s bond issue. Such a grant no longer seems likely, so the solar element of the project has been eliminated.

Asked if the wastewater plant would be more vulnerable to power outages from hurricanes without the solar, Bolton told the council the plant has a backup generator system, and the solar panels were never expected to run any of the treatment and pumping equipment in an outage. “They might keep the lights on,” he said.

The total cost of the plant is expected to be approximately $164 million, plus the cost of borrowing roughly $126 million via various bond issues. Of the city’s $38 million in awarded grants, $21 million must be spent, and matched by the city, by the end of 2026.

Bolton has been working with Indian River Shores Vice Mayor Bob Auwaerter to design a smarter financing plan for bonding out the plant project. Auwaerter volunteered to help as he is a retired Vanguard executive with extensive knowledge of bond financing.

Indian River Shores water-sewer customers will help pay for the new plant through their rates, as the town is on Vero’s utility system.

Where Auwaerter’s advice has been particularly insightful, Bolton said, is in determining how far out to finance various aspects of the project based upon the lifespan of the asset, focusing the 30-year bonds only on the bricks-and-mortar plant buildings, steel and foundation. If an asset operating within the building is expected to give out in 20 years, Auwaerter has advised only financing it with a 20-year bond.

“So that we try to balance the bonds based upon the future life of the equipment,” Bolton. “So that you’re not replacing, electrical, say at 25 years but you’re still paying on that for another five years because you’ve financed it for 30 years.”

Bolton hopes to break ground on the plant in the next 30 to 45 days. Site preparation and the running of a network of pipes and utilities to the plant is already underway. The city plans to take out a short-term loan to start the project, then to issue bonds in late 2026.

Utilities Commission member Tracey Zudans asked, “Is there a big difference in the interest rates between the two?”

Bolton said the interest on short-term loans is lower right now than the bond interest rate. In a year or so, bond rates could come down so the city might get better 30-year terms by waiting to issue the bonds. The city must complete a comprehensive rate study for potable water, sewer and reclaimed irrigation water before bonding out the treatment plant project.

As a side matter, Bolton also told the city’s volunteer Utilities Commission that added fluoride was shut off from the city water system at 1:30 p.m. on June 30 to meet the state’s July 1 mandate. Vero’s water has relatively high levels of naturally occurring fluoride from the groundwater, accounting for nearly half of the previously mandated fluoride level, so the city was not adding a lot of fluoride chemicals anyway, he added.