Sanitary district continues water-sale discussion

Sanitary district continues water-sale discussion

URBANA — Urbana & Champaign Sanitary District officials on Thursday continued their discussion of a million-dollar sale of treated wastewater to a fertilizer plant looking to locate its $1.2 billion plant in Tuscola.

Officials are continuing to balance the environmental effect of diverting water away from local streams with the financial benefit to the sanitary district and the prospect of hundreds of new jobs in the region.

Illinois and Iowa are in a bidding war to attract Cronus Chemical, and a site in Tuscola is a leading contender. Officials have said that the $1.2 billion plant could produce as many as 1,500 to 2,000 construction jobs during the 36-month building project, and the Cronus plant would provide as many as 200 permanent full-time jobs.

The fertilizer producer would need about 6.3 million gallons of water per day in its manufacturing process, and consultants for Cronus Chemical have asked the Urbana & Champaign Sanitary District for a direct flow of treated wastewater instead of drawing clean drinking water. The sanitary district processes about 20 million to 25 million gallons of wastewater per day, which it discharges into local streams.

On Thursday, sanitary district Executive Director Rick Manner said that officials would work toward a 20-year contract with Cronus if they chose to locate in Tuscola. Cronus would pay an estimated $1 million or more annually in return for the 6.3 million gallons per day of Champaign-Urbana's treated wastewater.

Cronus would build and finance a pipeline and pump station at the district's southwest treatment plant, while the sanitary district would own and maintain the pump and pipeline. The contract could also contain provisions for times of low flow to ensure local streams are receiving some amount of discharge from treatment plants.

Those details and more would still need to be worked out between the fertilizer manufacturer and the sanitary district, and that's assuming Cronus even chooses Tuscola as the site for its plant. Manner said the 20-year term of the contract is reasonable, given Cronus' potential massive investment and associated costs to the district.

"If Cronus shows up, it would not be as simple as a check for X number of dollars right away," Manner said. "The benefit would be over time."

That new revenue, Manner said, could nullify the need to ask ratepayers for more money in the future, but it would not necessarily mean a reduction in sanitary rates. The $1 million represents about 10 percent of the district's annual budget.

Environmentalists remain skeptical of the plan, and representatives of Prairie Rivers Network have been working with sanitary district officials on a policy to guide the sale of effluent to Cronus and any potential suitors in the future. They are concerned that diverting more than 6 million gallons per day from local streams will hurt wildlife and recreational activities.

Kim Knowles, a staff attorney for Prairie Rivers Network, told the district's board of trustees on Thursday that the district should commit itself to providing a minimum discharge to protect existing wildlife and recreational uses — not just during times of drought.

"While the district may have no legal duty to provide a minimum discharge, we believe it has a moral one," Knowles said.

Clark Bullard, an engineering professor at the University of Illinois, asked the board to clear up what Cronus really is. He said rumors have been circulating about the company's ownership and structure.

According to the Delaware Division of Corporations, Cronus Chemicals incorporated as a limited liability company in that state in November 2012.

John Kinnamon, a consultant working for Cronus, said the company's parent is "a major holding company" based in Europe. Its investors have "years of experience" in the industry, Kinnamon said.

After the company selects a site for its plant, Kinnamon said, there will be more disclosure of the ownership structure of the company. Until then, he said, it is maintaining its anonymity for "competitive reasons."

"The less anonymous things are is much better for this board," said sanitary district board member Jerry Lyke. "Because the public is not going to want us to move ahead anonymous, anonymous, anonymous."

Brian Moody, Tuscola Economic Development Inc. executive director, said the company is nearing a decision on its location — that could happen within the next month. Construction, whether it is in Illinois or Iowa, could begin early next year.

"I think when that happens, you'll see more information come out about the company's background," Moody said.

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rsp wrote on June 06, 2013 at 8:06 pm

Why is the same contractor involved with both projects? Orascom is building the one we were just in a bidding war with them over and they are supposed to build this one, and they are from Egypt. 


The new plant, proposed by Cronus Chemical LLC, Orascom Construction Industries, is expected to cost about $1.2 billion and create 2,000 construction jobs and about 150 permanent positions. The Delaware-based company is eyeing a site in Mitchell County in northern Iowa, and near Tuscola in central Illinois.

ilpatriot wrote on June 07, 2013 at 5:06 am

"Iowa officials have not confirmed they are working with the company, which a group of Turkish investors formed in December."