MONTICELLO – The Village of Monticello is taking its next steps in the Water Systems Improvement Project, moving ahead while coming in below budget as engineers work to secure financing and prepare for the next stages of construction.

Representatives Jason Denno and Don Fletcher from Barton & Loguidice engineering updated the Village Board on August 5 on their roughly $41 million, multi-phase project, which is currently in the first phase of Contract 4.

A senior manager with Barton & Loguidice, Denno has been working on the project for several months and noted that the current phase is coming in below its contract and bid amount. He spoke about the budget for the project’s first phase, which was set at nearly $9 million, but current costs have fallen into the low $7 million range.

A project that has been nearly 12 years in the making, the effort marks a milestone in the Village of Monticello’s attempt to move beyond simple “band-aid” fixes to its aging water infrastructure. The Sullivan County Democrat previously reported in February that the former treatment plant had reached the end of its usable life, with aging water mains leaking nearly half of the treated water.

Construction is moving along smoothly at the water plant, with four contracts involving three contractors currently underway. Fletcher, a principal with the firm, stated that as the work progresses, Phase 1 should be finished by March of next year.

Phase 2, meanwhile, is expected to be put out to bid later this summer or early fall, allowing construction to continue without a significant transition after Phase 1. The entire water plant is expected to be finished by the end of 2027.

The Dillon Street pump station and village water tank could be bid over the winter, with that work potentially being completed in 2027 or 2028. Following that would be distribution-line improvements, as the village determines which lines should receive priority as the project moves ahead.

As construction moves along, much of the current work involves navigating the project’s complex financing structure.

Multiple funding sources are supporting the project, including a $2 million EPA STAG grant, $12.4 million in USDA financing, $5 million in New York State Environmental Facilities Corporation funding, approximately $1.2 million and $4.4 million in USDA grants, and up to $14 million through an EFC hardship loan.

According to Denno, the village is working to access those funds while ensuring the project remains financially feasible.

One notable challenge the village faces is the USDA funding, which requires the village to spend the funds before they can be reimbursed. Therefore, the village needs to obtain a bond anticipation note, use the funds for project expenses and then seek reimbursement through USDA.

“We didn’t want to lose that funding, so we needed to move quickly,” Denno stated.

Fletcher explained that USDA funding is the oldest funding source available to the village, making its use a priority. EFC and EPA funding operate differently, allowing the village to use those funds to pay contractors and apply the expenses toward the associated grants or loans.

“[There are] a lot of programs, and a lot of complexity to it,” Denno said. “They’ve got different rules. So, we’re complying with all the rules.”

The issue of financing is becoming increasingly important as contractors have begun submitting bills, with the village working with its bank to get direction on obtaining the necessary funds.

Fletcher also updated the board on the water treatment requirements. He explained that additional testing had been completed and submitted to the Department of Health, which approved the testing and signed off on it. The next step will be submitting the Phase 2 plans to the department.