History

When Central Nebraska Public Power and Irrigation District (Central) initially built Johnson Lake and the related system of irrigation canals, no one could have imagined that the lake would one day become one of the most popular recreational sites in Nebraska. But in the late 1940s and early 1950s, houses began going up around the lake and soon there was a large community of private homes and businesses around its perimeter.

The majority of these homes and businesses around the shoreline are located on land owned by Central. All have their own individual septic tanks and drain fields to treat their wastewater. Drinking water is provided by 41 community wells and 35 private wells. These wells and septic tanks must all comply with the requirements of the State Department of Health and the State Department of Environmental Quality (NDEQ).

In March of 2000, NDEQ representatives met with JLDI officers and area presidents and explained that many of the properties at Johnson Lake would not be able to meet the setback requirements for septic tanks and drain fields from wells, buildings, lot lines, and shorelines as specified in the adopted State regulations for which they are responsible for enforcement. It has been estimated that 75 percent of the lots around Johnson Lake are too small to meet the new requirements and would not be able to obtain a permit to replace, repair, or expand their septic systems nor could they alter or change their existing buildings.

Routine sampling and testing by NDEQ, begun in 2001, has shown that Johnson Lake contains significant quantities of pathogenic bacteria. Although the source of these bacteria has not been determined, human indicators were identified and the results show that contamination of the lake is occurring and could have a negative impact on the recreational use of Johnson Lake in the future.

In September 2001, Central hired the engineering firm of Olmsted & Perry to assess these issues. In their report of April 2002, Olmsted & Perry reported that:

• Wastewater quantities are increasing because of the continued trend of year-round usage of the homes
• The soil around the lake is becoming saturated in some areas because of increased wastewater quantities
• Many lots do not have sufficient space to replace failing septic systems
• Johnson Lake residents would probably have to abandon the onsite septic tank treatment systems and replace them with a centralized wastewater collection and treatment system

The implications led the lot owners and leaseholders to decide to create some form of shared governance. By a margin of nearly two to one, with nearly 60 percent of eligible voters participating, they decided to create an SID. In February 2005, the District Court granted the formation of the Johnson Lake SID and the first meeting of the five-member Board of Trustees took place.

Phase I (Completed in 2005)

As the project began, there was no single wastewater management method that was clearly the best choice for the lake community. Instead, the engineers and scientists began by studying a variety of options and approaches.

Choosing the Best-suited System for the Lake Community

For collection of wastewater, the alternative sanitary sewer systems considered were:

• Gravity with lift stations,
• Vacuum pump sewer, or
• Low-pressure grinder pump.

For wastewater treatment alternatives, the team considered these options:

• Complete retention lagoon
• Controlled discharge lagoon, or
• A mechanical plant.

Much of Phase I study time was spent gathering information about all these options. Then, the team applied a broad range of criteria to each option, including capital construction costs, life-cycle costs, system reliability, regulatory compliance, and public acceptability, in order to come up with their formal recommendation.

The JLET Engineering Team’s Recommendations

For collection: a gravity sanitary sewer system
For treatment: a complete retention lagoon--With future growth, this could be converted to a controlled discharge lagoon.

These are the primary reasons for this recommendation:

• Proven reliability of the technologies
• Most cost-effective systems
• No permit or regulatory compliance needed
• Minimal training requirements
• Lowest life-cycle costs
• Ease of operation

Financing the Project: Initial Estimates

The best current estimate for the total project costs based upon the above recommendation is: $15.7 million.

In addition, there will be ongoing operating, maintenance and repair costs of the system after it is built. Annual operation costs are estimated to be $136,000 per year.

To finance the costs and to operate the system when complete, the SID #1 has three areas of financial responsibility:

Responsibility 1: Borrow money to build the project
SID #1 has no cash currently, but does have the ability to borrow all the money necessary to build the project. They intend to borrow through two methods:

• From the Clean Water–State Revolving Fund administered by the Nebraska Department of Environmental Quality, and
• From the private bond market–general obligation bonds.

Responsibility 2: Repay the borrowed money
The SID will have to repay the money borrowed to build the project by collecting funds from the home/cabin owners and businesses within the project boundary. Current plans call for two methods of collecting funds.

• Through a special assessment to the benefited properties, and
• Through a general obligation debt of the SID that will be paid back by an annual general obligation tax.

Responsibility 3: Pay for operating, maintenance and repair costs
The engineers have recommended a system that has proven reliability and ease of operation. Even so, there will be ongoing costs to operate and maintain the system. These costs can be paid for through revenue that the SID will generate from annual taxes.

Not until the system has been constructed will the exact costs be known. But, using current “broad brush” estimates, these are the estimated costs to homeowners.

Illustration of Current Estimates for Home and Business Owner Costs

• For the special assessment, an average of $10,650 per lot--This can be paid off all at once or over a 10-year period with interest.
• For annual general obligation tax: $510 per year on a $100,000 valued property.
• For annual operating, maintenance and repair costs: $160 per year on a $100,000 valued property.

Sanitary and Improvement District No. 1 of Gosper County (i.e. SID No. 1) was formed under the statutes of the State of Nebraska. As such, the methods of financing must follow the statutes and the law. The general obligation portion of costs therefore must be repaid from SID taxes, generated from a levy on property values within the boundaries of the SID. The Trustees of SID No. 1 are bound to follow the law, and therefore, there are no other options.

December 2003 aerial view of Johnson Lake. The JLET team uses aerial photos and on-site surveys as a starting point for understanding the topography of the area. The white areas in this photo are ice, the dark areas are open water.