MONTPELIER — On Friday, in his weekly report City Manager William Fraser said the district energy project is $900,000 over budget.
According to the city’s design engineer contractor, Hallam-ICS, the cost for the distribution system of underground pipes, not including the state heat plant, will cost $4,938,710, or $937,000 more than what the city has allocated for construction costs.
Fraser said that the city has a few options to fix the problem.
The city could secure another $900,000 of funding through a grant, or private investor, or by reallocating the cost sharing with capacity adjustment with the state.
The city could also get commitments from additional district energy users, which cover the $900,000 in financing.
A third option is to eliminate one or both of the schools from the project and get commitments from private users instead. The high school and the elementary school are part of the original project design.
Those last two options would require that the City Council relax its restriction that city officials not move forward with the project unless it is viable on its own without any private buildings owners tapping in.
The final option, Fraser said, would be to pull the plug on the entire district energy project due to lack of funds.
The City Council is expected to discuss the district energy project at the March 14 meeting.
That will be the first meeting for the new mayor John Hollar assuming he doesn’t lose to a write-in candidate on March 6.