AVALON – The borough is considering outsourcing the maintenance of its two water towers, a move that Administrator Scott Wahl says would result in a strong annual upkeep program while freeing millions in capital funds.
The borough’s two towers are at 14th Street and 38th Street.
At the Borough Council meeting Aug. 13, Wahl described a program that would outsource the maintenance of the towers even as the borough kept ownership of them. The concept, as he explained it, would shift maintenance risk from the borough to a provider while also ensuring all necessary maintenance, freeing up capital funds.
The provider, selected under a bidding process, would initially rejuvenate the two towers, at a likely cost of between $3 million and $3.5 million, before receiving an annual maintenance charge that would include a 100% warranty on maintenance needs. The time period of such a contract can, under state statute, be as long as 40 years.
A number of municipalities across the state are part of programs like the one Wahl described, but the only Cape May County municipality participating in something similar is Lower Township, through its Municipal Utilities Authority.
Currently, Wahl said, Avalon pays out roughly $1.5 million per tower in consecutive years when the towers need large-scale maintenance and painting, which he said occurs every 10 years or so.
Under the proposed arrangement, once the towers have been rejuvenated and turned over to the bid winner, that periodic hit to the borough’s capital budget is removed, and the ongoing annual maintenance fee becomes an item of the borough’s municipal budget. The cost to taxpayers is spread out and no longer becomes part of long-term debt, he said.
Wahl also said the contract would give the borough the right to end the arrangement at any time if the borough is not satisfied with the performance of the provider.
“We could then issue a new [request for bids] or go back to the current bid process,” he said. The current process has the borough responsible for ongoing maintenance, with the use of a bidding to hire a firm whenever the towers need repainting.
No action was taken on the proposal, as it was an administration presentation.
The council appeared to receive the concept well, with one member, Sam Wierman, calling it a “no brainer.”
Contact the reporter, Vince Conti, at vconti@cmcherald.com.
