GENEVA — Thanks to a recent upgrade of its sewage treatment facilities, the city is back in compliance with its State Pollution Discharge Elimination System permit.

Simply put, it means the treatment plant is discharging fewer pollutants into Seneca Lake. And it was done in a way that saved city taxpayers about $11 million.

“We were told in 2003 we were in violation of our discharge permit because our plant could not handle the flow from sewage and from storm water that infiltrated the system,’’ said Gordon Eddington, city public works director.

“The flow when there was a big storm was too much for the plant to handle,’’ Eddington said. “Sewage was not getting treatment before going into the lake.”

He said the city has an old sewer system that has a lot of basement sump pumps and roof drains that flow into it, even though that is illegal.

The state Department of Environmental Conservation ordered the city to correct the situation, demanding that it sign an order consenting to make upgrades to correct permit violations.

The city worked with O’Brien & Gere Engineers to design nearly $15 million worth of upgrades. The main treatment plant on Doran Avenue was improved, and its capacity doubled from 3 million to 6 million gallons a day. A new excess flow treatment facility was then built at Gulvin Park on Middle Street; it can handle up to 35 million gallons of overflow in a 24-hour period before discharge into the lake.

The city hired Hubbard Construction Inc. of Skaneateles as a general contractor to upgrade the Marsh Creek wastewater treatment plant and build the new Gulvin Park facility. The five-year project was completed in August.

Eddington said the new system has been working as planned.

To pay for the upgrades, the city applied for and received a $13.6 million, 30-year, no-interest loan from the New York State Environmental Facilities Corp.

The interest-free financing is provided by the Clean Water State Revolving Fund and will save the city an estimated $11 million in interest costs.

“We were looking for a low-interest loan and heard about the no-interest program. It involved a lot of information to gather and criteria to meet, including the age of the system and the demographics of the city,’’ Eddington said.

“It took nearly eight months to get the application in,’’ he said. “But it was worth it. We’re saving the city $11 million in interest and the system is working fine,’’ he said.

“The Environmental Facilities Corporation is extremely pleased to offer the city interest-free financing for this greatly-needed wastewater treatment project,’’ Matthew Millea, acting president of the corporation, said during a visit to the city last week. “We are committed to working with the city to protect Seneca Lake, promote smart, sustainable growth and reduce energy consumption at wastewater treatment facilities.”

Mayor Stu Einstein said the “creative funding plan allows the city to make much-needed infrastructure updates and to become better stewards of our environment, while minimizing the impact on taxpayers.”

The interest-free financing allows the city to reduce its sewer rate increase for 2009 from 95 to 47 cents per hundred cubic feet of water.

“This program has positively contributed to the health and vitality of our greatest natural resource, Seneca Lake,’’ said Mathew Horn, city manager. “The inter-governmental cooperation here provides maximum value for precious taxpayer investment.”

The city is now designing a $2 million upgrade to its filter system at the Lochland Road water treatment plant, a project that will go to bid this winter with a contract awarded in the spring.

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