Contractors have started moving dirt around at the site of the City of Morro Bay’s new sewer treatment plant, located at the terminus of South Bay Boulevard at Teresa Drive.

City Manager Scott Collins said they gave the “Notice to Proceed” to Black & Veatch/Filanc in mid-March, shortly after the city locked down a federal low interest loan for the $126 million project. They wasted little time getting up and started.

Collins said work could continue through the Coronavirus Pandemic because it’s considered “essential service/infrastructure” under the shelter-at-home orders of the State and SLO County.

As for a State low interest loan, needed to complete financing of the project, Collins said they hadn’t decided how much of the remainder they would borrow. The State approved up to $100 million and also gave the City a $5M grant.

“We will complete a financial analysis to help determine the optimal mix of these funding sources. That analysis will likely go to the Citizen Finance Advisory Committee for review and then it will definitely go to City Council who will decide how much to take from SRF,” Collins said.

Naturally, the virus could flush all these plans. “The COVID-19 pandemic may slow the processing down a bit,” Collins said, “but we do anticipate closing the SRF loan by summer 2020.”

The City also has millions in reserves in the sewer and water funds.

Still to come is a final design of the conveyance system portion of the project, bidding and hiring a contractor for that work, and final designs of the water-recycling portion, an expense that the City has yet to include in the project cost estimates.

Collins said they would schedule a groundbreaking ceremony for the public after the virus emergency is over.