City of Blanco Lift Station Project
4/12/2024
Dear Residents of Blanco:
I am pleased to report that the City’s new lift station is now in operation. The lift station handles and transfers 100% of the City’s wastewater to our treatment facility. These events culminate and mark the end of a multiyear project. I want to thank the current Council and staff, as well as previous City officials and staff, who made this possible. Most of all, on behalf of the Council and staff, I want to thank all City residents for their patience and support of this critically important infrastructure project.
I also want to mark these events by providing important information and clarification about the land acquisition that led up to and allowed for completion of this new lift station. Below is an explanation of the financial transaction and the history that supports the decisions that were made on the project.
In late 2021 the City of Blanco and Winona 416 Ltd entered into an agreement that would "swap" property and cash to allow the City’s new lift station to be relocated out of the 100-year floodplain, on adjacent land owned by Winona. The relocation kept the project in compliance with TCEQ and other regulatory mandates and qualified the project for a 2020 TDA TXCDBG grant worth $300,000. The City owned the original 0.82 acres here, which was the historical location of the City’s lift station, for almost 70 years. Like the new station, the old one handled transfer of 100% of City sewage to the City’s wastewater treatment plant. In 2015, and on other occasions, this old station was inundated or affected by flood waters. The City determined first to attempt a rehab of the facility in place. But no public or private financing was available unless the station was moved up and out of the 100-year flood plain. In 2019 and 2020, the City then began negotiations with the only surrounding landowner that was available and willing to accommodate the City’s needs. That landowner was an entity known as Winona 416, Ltd, which was in turn owned by the family of City Council member Mike Smith. The City eventually concluded a transaction with Winona, which was necessary to provide a location for the new lift station out of the 100-year floodplain.
To get the grant money and new non-floodplain location for the new lift station, the City swapped and is transferring the old station 0.82-acre tract to Winona, as-is where-is, with no obligation to deal with years of possible environmental contamination from the old lift station operation. Winona acknowledged the possible contamination and absolved the City of further liability on this issue. When the City originally sought to close this part of the transaction, the City and Winona discovered a cloud on title that was caused by an erroneous document filing. Clearing that error was the subject of Texas Parks & Wildlife Commission action in March 2024. In exchange for the 0.82 tract, Winona is paying the City with $100,000 cash and the transfer of the new lift station tract of land and a related easement within Winona’s adjacent property.
In this transaction, the City originally used a CAD appraisal to value its 0.82-acre tract (which stated the tract at $100,000), while a private appraisal was used for the new lift station tract and easement, carved out of the larger adjacent tract. Those differing value references are resolved by looking at the actual values exchanged under the private appraisal (the higher value). So, using that private appraisal as reference, the City is receiving $143,727 in cash and property in exchange for transferring property valued at $143,427 (before any adjustment for any required cleanup of the old station land—which is Winona’s sole responsibility). The $143,727 for .82 acres comes out to $175,276 per acre without consideration for environmental contamination.
The City is responsible for providing utility service for the residents of Blanco, which also includes building and maintaining facilities that treat water and wastewater. The City must ensure that these facilities comply with local, state, and federal regulations. We try to do this in the most efficient and cost-effective manner while being good stewards of taxpayer dollars and the public trust. We feel that this was the best deal that could be made at the time and necessary to provide a safe and efficient facility, while also receiving the 2020 grant.
Warmest Regards,
Warren Escovy, City Administrator