STATEWIDE
WASTEWATER
RECYCLING PROJECT
FINAL REPORT
Local Government Association
of South Australia
November 2011
CONTENTS PAGE
Executive Summary
1
Introduction
1
2
The project Development Process
1
3
Conduct of the Project
2
4
Project Variations
3
5
Project Completion
5
6
Project Evaluation
6
7
Recycled Water Outcomes
7
8
Financial Outcomes
8
APPENDICES
1
Audited Financial Statement Project Completion 2011 (33123)
2
Project status report to the CWMS Management Committee (69198)
3
Project variations report (69198)
4
Project outcomes report (69198)
ACRONYMS
1
CWMS
Community Wastewater Management System1
DEWHA
Department of Environment, Water, Heritage and the Arts
DSEWPaC
Department of Sustainability, Environment, Water, Population and
Communities.
LGA
Local Government Association of South Australia
LGFA
Local Government Finance Authority
NWC
National Water Commission
WSA
Water Smart Australia
Formerly known in SA as Septic Tank Disposal Schemes (STEDS)
STATEWIDE WASTEWATER RECYCLING PROJECT FINAL REPORT
Local Government Association of South Australia
EXECUTIVE SUMMARY
The Australian Government’s Watersmart Australia program was announced in 2006 and the LGA
worked closely with Councils and the SA State Government to assemble a ‘Statewide’ submission
proposing the upgrading of many small CWMS to achieve water recycling standards. The LGA
submitted that aggregating a large number of small regional projects through one contract
brokered by the LGA met the innovation criteria of the NWC project because no such large scale
project had been attempted previously. Moreover, in the absence of the aggregated project model,
small regional communities would not have been able to access Australian Government funding,
thereby losing the opportunity to benefit from wastewater recycling and reducing their demands on
existing water sources. Following agreement with the NWC, the LGA developed and lodged the
submission, which included 35 Councils2 nominating 63 projects with a total estimated capital cost
of approximately $90 million.
In June 2007, the Australian Government announced a grant of $20 million for the project and a
Deed of Agreement between the LGA and the NWC was signed on 1 November 2007. In the
period between July 2007 and June 2011, the LGA worked with Participating Councils to ensure
the delivery of the project. The task of coordinating a project with a capital value of $90 million
involving 63 individual projects working with 35 separate Councils was indeed challenging for the
LGA. However, as recorded in this final report, the LGA believes that the agreed objectives for the
Statewide Wastewater Recycling Project, including the demonstration of an innovative project
management approach to deal with multiple small but important projects in regional towns, have
been achieved.
As at 31 May 2011, the Statewide Wastewater Recycling project has achieved the following
‘headline’ results:
 28 councils completed and delivered 56 CWMS wastewater recycling projects;
 $75 million capital expenditure on essential infrastructure in regional SA;
 $16.94 million Australian Government grant funds allocated to councils;
 7,534 ML per annum estimated volume of treated wastewater recycled with an equivalent
reduction in the demand on the River Murray and other water resources.
This report includes all but one of the projects completed by participating Councils.
A further project (District Council of Robe) was granted a special approval to complete its project
by 30 June 2012. This project was delayed by unforseen planning issues outside of the Council’s
control.
There have also been associated benefits for regional communities through the upgraded CWMS
being engineered to modern standards, increasing environmental and operational performance
and enhanced amenity through irrigation of public spaces and recreation areas.
When considered together with the ongoing grant program from the State Government for the
construction of new CWMS there has been a massive investment in regional wastewater
infrastructure over the past four years in an outstanding partnership between the Commonwealth,
State and Local Governments.
The LGA, participating Councils and their communities congratulate the Australian Government for
its significant contribution to this achievement including the successful demonstration of an
innovative project management, which has delivered many small projects through a single contract
management arrangement.
2
referred to in this report as ‘Participating Councils’
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1
INTRODUCTION
The decade from 2000 was one of severe drought throughout most of Australia, particularly in
those regions reliant on water supplied from the River Murray. In a plan to preserve water for
critical human needs the State Government imposed progressively more severe water restrictions
on the use of water for commercial, agricultural and recreational irrigation purposes. Many regional
Councils were forced to restrict the use of potable water supplies used to irrigate community open
spaces and recreation areas.
The LGA, in consultation with its member Councils identified that an opportunity existed to utilise
‘fit for purpose’ treated wastewater from existing CWMS for irrigation purposes which were being
lost to the environment through evaporation, leakage or overflow. However, systems would need
upgrading to improve the quality of the available wastewater. Irrigation distribution systems would
also need to be installed. Pursuing this objective would provide a ‘new’ source of water treated to a
standard fit for irrigation purposes as an alternative to using potable water, thereby reducing the
demand for water from the River Murray or groundwater resources.
When the Australian Government, through the NWC, established the ‘Water Smart Australia
Program’ the LGA held discussions with the NWC regarding the possibility of the LGA seeking to
aggregate a large number of small projects in individual Councils into a single funding application
be considered by the NWC as a single project for funding purposes. All Councils with CWMS were
invited to participate in the funding application. 39 Councils representing 69 individual CWMS,
registered an interest, provided preliminary project proposals and cost estimates.
The LGA’s governing body, the LGA State Executive Committee, endorsed the lodgement of the
final version of the Statewide Wastewater Recycling Project in mid 2007. On 27 June 2007, the
Hon Malcolm Turnbull MP, the then Minister for the Environment and Water Resources,
announced a $20 million funding grant from the Water Smart Australia program for the project.
Representatives of both parties signed the funding deed for this project on 1 November 2007.
The LGA State Executive Committee delegated the CWMS Management Committee to manage
the implementation of the project. The Management Committee played a vital role in the
governance of the project, especially maintaining the partnership approach between the Australian
Government, State Government agencies, the LGA and Participating Councils. Representatives of
DEWHA and DSEWPaC were ex officio members of the committee throughout the life of the
project.
2
THE PROJECT DEVELOPMENT PROCESS
As stated above, after the announcement of the Water Smart Australia Program, the LGA invited
all member Councils that operate CWMS schemes to register an interest to be a part of an LGA
administered aggregated project application. Councils were advised that nominated projects must
include water conservation components that would directly reduce the drain on the River Murray or
other potable water resources. 39 Councils submitted registrations of interest for 69 individual
CWMS projects with a total preliminary cost estimate of approximately $90 million.
After the announcement of the $20 million grant in June 2007, there was significant further
consultation between the NWC and LGA officers to settle the final details of a Deed of Agreement
between the Commonwealth of Australia and the LGA for the operation and management of the
project.
The Deed of Agreement was signed in November 2007. During the period of negotiation and prior
to signing of the Deed of Agreement, the LGA took the following steps:
 confirmed the role and responsibilities of the CWMS Management Committee as provided
for in the Deed of Agreement;
 invited a nominee of the NWC to serve on the CWMS Management Committee for the
duration of the project;
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




3
changed the meeting schedule of the Committee from Quarterly to bi-monthly to take into
account the added workload and reporting regime;
appointed the CWMS Program Manager as the Statewide Wastewater Recycling Scheme
Program Manager;
called and assessed tenders from qualified Engineering Consulting companies for inclusion
on an LGA CWMS Panel of Preferred Consultants, to streamline planning, design and
approval processes and to minimise design and consulting costs;
recommended Consultants from the panel to Participating Councils based on prior
relationships and regional considerations; and
determined, as a result of the $20 million available, that subsidy would be distributed
between all eligible projects on an equitable basis. Projects would receive 24.9% of capital
cost with the maximum grant allocation capped at $1 million dollars for any single project,
subject to special circumstances and/or innovation.
CONDUCT OF THE PROJECT
After the Deed of Agreement was signed, the following actions were taken:
 a Copy of the Deed of Agreement was sent to every Council that had indicated its
willingness to participate;
 a letter, highlighting Council responsibilities and procedures, was sent to every Council
accompanied by a standard Participating Council form requiring each Council to formalise
its commitment to the project by signing and returning the form now that final grant
allocations were confirmed; and
 the creation of a Statewide Wastewater Recycling fund with the Local Government Finance
Authority (LGFA) in accordance with the requirements of section 6.5 of the Deed.
The CWMS Program Manager was given the responsibility of managing the operational aspects of
the project by working with Councils to ensure that the approved projects were completed in
accordance with statutory obligations, where applicable. The CWMS team met with Council officers
and/or Council consultants during site visits on numerous occasions during the project design and
construction phases depending on the scope and complexity of the project. As a result of
relationships created by State Government agency representation on the CWMS Management
Committee, the CWMS team was often able to facilitate meetings between Councils, consultants
and the State agencies, which assisted in streamlining the required approval processes.
The CWMS team was also responsible for collecting milestone reporting data for the LGA and the
CWMS Management Committee for transmission to the Department for approval including the
identification of any significant issues or barriers to meeting the milestone objectives. A project
progress report was submitted to each meeting of the CWMS Management Committee for the life
of project. Exception and variation reports were also submitted to the Committee to consider
individual Council issues, proposals for funding reallocations or reports where project progress was
a concern.
The CWMS Management Committee was required under the terms of the Deed of Agreement to
submit Milestone reports to the Department for each 6 monthly stage of the project, reporting on
achievements the targets included in the Deed of Agreement. Release of the funding allocation for
each Milestone was dependant on agreed Milestones being met, or the Department being satisfied
that any explanation for not attaining a particular Milestone was satisfactory.
The Deed of Agreement also required that by September of each financial year of the project and
within 60 working days of conclusion of the project that a financial audit of the project is carried out
by an independent auditor. A copy of the project finalisation audit statement is provided (Appendix
1).
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4
PROJECT VARIATIONS
The Deed of Agreement between the LGA and the Australian Government represented by the
NWC was signed on 1 November 2007 and provided for:
 35 Councils, representing 63 projects;
 project completion date of 30 June 2010;
 total estimated project capital cost of $89,727,000;
 Water Smart Australia grant $20 million;
 Councils capital contribution $69,727,000; and
 estimated recycled water to be saved 8,243 ML per annum.
In the months after the Deed was signed, Councils carried out more detailed project investigation
and designs and updated cost estimates for their nominated projects. In some instances, meetings
were held with the various statutory bodies to resolve potential conflict or difficulties regarding the
granting of project approvals. In some instances, Councils assessed the design on a cost/benefit
ratio to determine if the actual volumes of recoverable wastewater would be worth the high capital
cost of implementation and ongoing operation. As a result of the more detailed work including
discussion and negotiation with members of the LGA project management team, a number of
Councils decided not to proceed with this project and advised the CWMS Management Committee
accordingly. A report was submitted to the CWMS Management Committee at the February 2009
meeting outlining the various project variations including:
 projects withdrawn by Councils;
 projects where the cost estimate was reduced and the grant allocation was reduced
accordingly;
 previously considered and approved additional replacement projects;
 previously approved expanded projects;
 project submissions received seeking additional grant funding; and
 ‘at risk’ projects.
A summary of the position at February 2009 was:
Withdrawn Projects
COUNCIL
PROJECT
Alexandrina
Murray Bridge
Pt Elliot
River Glen
Wood Lane
Lucindale
Morphett
Vale
Napperby
Streaky Bay
Border Town
Yank/Norman
Naracoorte/Lucindale
Onkaparinga
Port Pirie
Streaky Bay
Tatiara
Yankalilla
Total
CAPITAL
COST
$40,000
$140,000
$140,000
$430,000
$2,153,000
COUNCIL
COST
$30,000
$105,100
$105,100
$322,900
$1,617,000
APPROVED
GRANT
$10,000
$34,900
$34,900
$107,100
$536,000
RE-USE
ML
183
17
10
24
45
$250,000
$50,000
$505,000
$5,840,000
$9,548,000
$187,700
$37,500
$379,300
$4,840,000
$7,624,600
$62,300
$12,500
$125,700
$1,000,000
$1,923,400
14
63
199
133
688ML
The principal objective in seeking replacement projects or expanding existing projects was to
ensure that wastewater recycling reductions from withdrawn projects were replaced, as far as
possible. In addition, a project variation by the City of Port Augusta resulted in a total project cost
reduction from $2,265,000 to $1,492,000 that resulted in a reduction in the grant allocated from
$564,000 to $371,500. There was no change to estimated recoverable wastewater.
The CWMS Management Committee, and subsequently DEWHA had already approved the
following new projects and amendments to existing projects:
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New Projects
COUNCIL
Alexandrina
Goyder
Wakefield
Region
Total
PROJECT
Goolwa Nth
Eudunda
Snowtown
CAPITAL
COST
$414,200
$1,074,000
$800,000
COUNCIL
COST
$311,100
$806,600
$601,000
GRANT
PRE
ML
$103,100
$267,400
$199,000
POST
ML
200
52
40
$2,288,200
$1,718,700
$569,500
292
Expanded Projects
COUNCIL
Kingston
Sthn Mallee
Wattle Range
PROJECT
Kingston
Amended to
Pinnaroo
Amended to
Penola
Amended to
TOTALS
Original
Amended
CAPITAL
COST
$140,000
$204,000
$460,000
$1,100,000
$943,000
$2,470,000
COUNCIL
COST
$105,100
$153,100
$345,500
$726,100
$708,200
$2,070,000
GRANT
$34,900
$50,900
$114,500
$273,900
$234,800
$400,000
$1,543,000
$3,231,000
$1,158,000
$2,959,200
$384,200
$724,800
PRE
ML
104
POST
ML
124
20
48
64
75
188
247
The February 2009 report also recommended the following additional projects for the allocation of
funding which were approved by the CWMS Management Committee and subsequently approved
by DEWHA.
COUNCIL
Alexandrina
Alexandrina
T.T. Gully
PROJECT
Goolwa
Shandy
Commodore
Reserve
Project
Expansion
Total
CAPITAL
COST
$550,000
COUNCIL
COST
$413,000
APPROVED
GRANT
$137,000
RE-USE
ML
75
$300,000
$225,000
$75,000
20
$800,000
$600,000
$200,000
20
$1,650,000
$1,238,000
$412,000
115ML
By October 2009 further project variations were reported to the CWMS Management Committee
and approval for these variations were approved by DEWHA
Withdrawn Projects
COUNCIL
Adelaide Hills
Mt Barker
Mt Barker
Total
PROJECT
Woodside
Macclesfield
Meadows
CAPITAL
COST
$1,445,000
$290,000
$1,090,000
$2,825,000
COUNCIL
COST
$1,085,200
$217,800
$818,600
$2,121,600
APPROVED
GRANT
$359,800
$72,200
$271,400
$703,400
RE-USE
ML
132
48
44
228ML
CAPITAL
COST
$1,127,500
COUNCIL
COST
$683,500
APPROVED
GRANT
$444,000
RE-USE
ML
75
$190,000
$143,000
$47,000
20
Added Projects
COUNCIL
Alexandrina
Goyder
PROJECT
Goolwa
Shandy 2
Eudunda
Shandy
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STATEWIDE WASTEWATER RECYCLING PROJECT FINAL REPORT
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Northern Areas
Karoonda
Mt Barker
Streaky Bay
Total
Gladstone
Karoonda
Browns Dam
Streaky Bay
$600,000
$720,000
$1,450,000
$50,000
$4,137,500
$450,000
$540,000
$1,087,500
$37,500
$2,941,500
$150,000
$180,000
$362,500
$12,500
$1,196,000
PROJECT
CAPITAL
COST
$485,000
$285,000
$2,800,000
$2,300,000
$2,130,000
$1,430,000
$2,100,000
$2,440,000
$1,300,000
$1,377,200
$720,000
$954,000
$250,000
$330,000
$2,200,000
$1,200,000
$235,000
$467,800
$400,000
$1,500,000
$2,120,000
$1,100,000
$850,000
COUNCIL
COST
$364,200
$214,200
$2,102,800
$1,728,000
$1,599,600
$1,072,600
$1,577,100
$1,840,100
$976,300
$1,034,300
$540,700
$714,400
$187,700
$237,700
$1,652,200
$900,000
$175,500
$409,300
$300,400
$1,000,000
$1,592,100
$690,900
$638,300
GRANT
$120,800
$70,800
$697,200
$572,000
$530,400
$357,400
$522,900
$599,900
$323700
$342,900
$179,300
$237,600
$62,300
$92,300
$547,800
$300,000
$58,500
$58,500
$99,600
$500,000
$527,900
$409,100
$211,700
$650,000
$340,000
$340,000
$488,100
$255,300
$210,300
$161,900
$84,700
$129,700
20
36
117
63
331ML
Amended Projects
COUNCIL
Adelaide Hills
Alexandrina
Light
Barossa
Renmark
Cleve
Kimba
Goyder
Mt Barker
Port Pirie
Wakefield
Wakefield
Wudinna
Kersbrook
Amended to
Goolwa
Amended to
Freeling
Amended to
Nuriootpa
Amended to
Paringa
Amended to
Cleve
Amended to
Kimba
Amended to
Burra
Amended to
Echunga
Amended to
Crystal Brook
Amended to
Balaklava
Amended to
Hamley
Bridge
Amended to
Wudinna
Amended to
Total
PRE
ML
19
POST
ML
19
273
273
142
142
285
585
63
71
71
89
100
108
65
65
24
24
64
64
134
134
40
40
41
1,321
41
1,655
One of the significant outcomes of these project withdrawals, additions and expansions with what
was a record wet winter in 2009/10 was that a number of projects would not be able to meet the
30 June 30 2011 project completion date. There were also a number of problematic projects
previously reported to the CWMS Management Committee and DEWHA that resulted in
construction of projects not being commenced. The decision not to proceed with these projects by
the Councils was not made in sufficient time to enable the CWMS Management Committee or
DSEWPaC to consider re-allocation of the grant funds to other projects. These projects were:
 Port Pirie Regional Council: Napperby, Pt Pirie and Crystal Brook
 Northern Areas Council: Gladstone
 Copper Coast Council: Kadina, Wallaroo
A consolidated list of project variations is included as Appendix 3.
6
PROJECT COMPLETION
Individual projects were completed throughout the duration of the project. Some less complex
projects were completed early in 2008 with the balance being completed progressively through to
March 2011. As outlined earlier in this report, one project (Robe) was granted a special approval to
be completed by 30 June 2012 and is therefore not included in this report.
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The regular report to the CWMS Management Committee and the 6 monthly Milestone reports to
DEWHA reported individual project progress, during the reporting period estimated project
completion dates and flagged problematic projects were indicated. Re-allocation of project funding
as a result of the withdrawal of projects leading to the addition and or expansion of projects also
coincided with a record wet winter in 2009-10. There was also significant concern about the
potential future of a number of problematic projects, particularly the 3 Port Pirie projects and the
Robe project. As a result, an application was submitted DEWHA in April 2010 seeking to extend
the project deadline beyond June 2010. This request was approved on 2 June 2010 approving an
extended project deadline up to 31 March 2011.
All project sites were visited by a CWMS project team member on a number of occasions to meet
with the responsible Council Officer and/or the consultant, particularly on the receipt of advice of
project practical completion. Certificates of Practical completion have been issued for all of the 56
projects completed.
7
PROJECT EVALUATION
From almost every perspective, this project has been very successful. The project has resulted in
the upgrading of 56 CWMS schemes to a standard that has enabled the reuse of treated
wastewater that is fit for purpose for the irrigation of a range of purposes, for example:
 Council reserve areas;
 Council sporting facilities;
 Council landscaped areas;
 golf courses;
 a race course;
 broad acre cropping grasses;
 grape vines; and
 a commercial turf farm.
This resulted in a significant reduction in the use of potable water sourced from the River Murray,
underground bores or other water catchments. Restrictions on the use of these water sources
created significant problems during the drought.
Production of ‘fit for purpose’ recycled wastewater from CWMS has enabled Councils to maintain
or increase their water regime on ovals and sporting grounds, activities on these areas are safer as
a result of softer playing surfaces. Improvement to CWMS schemes by upgrading and lining
treatment and storage lagoons and by constructing mechanical Wastewater Treatment Plants to
replace leaking facultative lagoons has resulted in a reduction in wastewater overflow or seepage
into nearby groundwater, reducing the risk to public health.
27 Mechanical Wastewater Treatment plants were constructed during this project and two plants
were upgraded. The quality of the treated wastewater for recycling is significantly improved and the
water can be used direct from the plant losses through evaporation of stored water is reduced. The
cost of this remediation work and wastewater recycling effort has been a significant investment by
regional Councils (with the assistance of the NWC funding) and the rural communities of South
Australia will be the long term beneficiaries of this project, including during periods of prolonged
drought.
Description
Original submission by the LGA to
the NWC excluding NEW CWMS
The final submission to the NWC
as represented in the signed
Deed Of Agreement
No of
Councils
No of
Projects
39
69
Est. Value
Council
Contribution
$45,000,000
35
63
$69,727,000
DME 68854
Grant
$45,000,000
Est.
Water
ML
8,439
$20,000,000
8,243
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STATEWIDE WASTEWATER RECYCLING PROJECT FINAL REPORT
Local Government Association of South Australia
Funded projects completed at 31
March 2011
Projects not funded or funds not
transferred. i.e.
Kadina, Wallaroo, Gladstone, Port
Pirie, Crystal Brook, Napperby,
Robe
8
28
56
$57,916,233
$16,940,300
7,534
4
7
$9,275,000
-$2,433,400
-866
TREATED WASTEWATER AVAILABILITY
The actual volume of treated wastewater likely to be available for recycling is difficult to calculate
precisely. In the absence of metering, volumetric calculation for CWMS systems is based on the
number of user properties (both residential and non residential), the number of persons, the
estimated evaporation rate for the region, the estimated amount of stormwater infiltration and other
local factors. The consulting industry uses these estimates, plus the estimated potential growth in
the locality over a five or ten year horizon (depending on anticipated high or low growth estimates)
to determine the design parameters to be used in designing the capacity of a CWMS.
During periods of drought, the estimated volumes available for recycling can be significantly
affected when the community becomes much more careful about the use of water. During the
drought period, the volume of wastewater being received and treated by SA Water at the major
metropolitan sewerage treatment plants was reduced by as much as 30% below usual volumes.
Estimates are more difficult to calculate if harvesting and reuse of stormwater is included,
particularly where water retention/detention storage areas are limited.
In the initial submission by the LGA to the NWC, the estimated volume of treated wastewater likely
to be available was based on preliminary designs and desktop calculations. Following project
approval, the signed Deed of Agreement provided for 35 Councils representing 63 projects to
produce an estimated volume of 8,243ML of treated wastewater for recycling.
At the conclusion of the project, taking into account all of the various projects that were either
withdrawn, added, expanded or did not proceed, using the standard calculation methodology
produced the following revised estimates. 56 completed projects will produce an estimated volume
of treated recycled wastewater of 7,534ML (Appendix 4). It should be noted that if the estimated
wastewater volumes from the 7 projects that were withdrawn were added (866 ML), the total
estimated volume would have been 8,400 ML, which would have exceeded the estimated volume
originally provided in the Deed of Agreement.
It will be at least two years following the completion of each project before an accurate assessment
can be made of the actual volumes of treated wastewater being recycled. Collation of this
information for many of the systems will be made easier in the future by inclusion of flow meters in
the construction design for CWMS.
Furthermore, many Councils will experience significant development over the current planning
horizon of 5 to 10 years resulting in a significant growth in the recycled wastewater volumes. Areas
of known significant population growth include:
 Alexandrina
(Goolwa and Strathalbyn)
 Barossa
(Nuriootpa)
 Clare & Gilbert Valley
(Clare)
 Coorong
(Meningie)
 Light
(Kapunda, Freeling)
 Loxton/Waikerie
(Loxton)
 Mt Barker
(Mt Barker)
 Renmark Paringa
(Renmark)
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Councils involved in this project are now much more aware of the potential for wastewater
recycling and some Councils are also investigating or implementing stormwater harvesting projects
to complement the water recycling work done to date.
Therefore, over time, it is expected that the recycled water targets in the original deed will be
exceeded.
9
FINANCIAL OUTCOME
The Deed of Agreement between the LGA and the NWC made financial provision for aggregation
of 63 projects nominated by 35 Councils with the estimated total capital cost of the project being
$89,727,000 (GST exclusive). The grant allocated from the Watersmart Australia Project to
subsidise the expenditure was $20,000,000 (GST exclusive).
The Deed of Agreement required the NWC to be provided with an audited statement of income and
expenditure for the period of each financial year of the project and within 60 working days of the
completion of the project. The audited financial statement representing part of this project
completion report 2011 is also provided (Appendix 1).
Income from agreed Milestone payments received in advance from DSEWPaC was invested with
the Local Government Finance Authority at commercial rates in accordance with the provisions of
the Deed of Agreement. Income from the investment of the advance milestone payments were
used to fund the cost of management and administration of the program by the LGA.
DME 68854
8