Baraboo, distillery still at odds over sewer rates

July 24, 2018 GMT

A Baraboo distillery and city leaders are working to resolve a dispute over water bills.

Driftless Glen Distillery representatives appeared before the Common Council’s Public Safety Committee on Monday, looking for relief from what the business contends are excessive sewer rates. Council members and city department heads said they’re willing to entertain the distillery’s proposed solutions, as long as the city’s costs are covered without burdening other taxpayers.

“They’re asking you to subsidize their business significantly,” Utility Superintendent Wade Peterson told the committee.

City leaders accepted Driftless Glen’s offer to install metering technology that would measure how much water it discharges into the sewer system. The city’s sewer rate is based on the assumption that whatever water goes in must come out, but distillery representatives said one-quarter of the water it takes in evaporates.

Yet to be determined is whether city leaders are willing to give Driftless Glen a break on the rate in charges for discharging high-density waste — grains that are byproducts of the distilling process — to the sewer plant. The distillery has offered to install technology that would create a gradual flow of high-strength wastewater into the system to avoid taxing its capacity.

Built along the Baraboo River next to Circus World, the distillery is getting national attention for its craft spirits three years after opening. Owners Brian and Renee Bemis hope to expand by running second and third shifts, but those plans have stalled over wastewater issues. The cost of hauling high-density wastewater to another location is hamstringing the distillery financially, representatives said, and if it can’t reach a resolution with the city, Driftless Glen might have to look elsewhere.

“Our goal here is to try to work through a lot of these issues,” said Buck Sweeney, the Bemis’ attorney. “If the rates are too high, we have to look at our various options, and Baraboo might not be one of them.”

City leaders agreed Driftless Glen and its restaurant benefit the community, and expressed willingness to negotiate. Any break on the business’ water rate would require an ordinance change or a variance approved by the full Common Council.

Council member Michael Plautz said Baraboo taxpayers already are paying for a new city hall and a renovated high school. “I don’t want to put that burden on them now, no matter how successful your business is,” he said.

About one-third of the distillery’s wastewater is considered high-strength and subject to higher sewer rates. Driftless Glen has been hauling such waste offsite but would like to use the city sewer if a lower rate is approved.

“We’re trying to stay competitive and stay in Baraboo,” Sweeney said.

City leaders said they want their costs covered, and aren’t willing to give Driftless Glen a break at other taxpayers’ expense. A four-month rate study that’s about to begin will provide insight into how much it costs to process the distillery’s wastewater.

Capacity is another issue. When in production, the demand the distillery places on the sewer plant is equivalent to 140 homes. Peterson said the system can handle the distillery’s wastewater, but the business should cover the costs it incurs.

“It certainly has an effect on the operation of the wastewater treatment plant,” the utility superintendent said. “Every pound they send to us, it costs us money to process that.”

Jim Smith, a consultant Driftless Glen hired to help mend its rift with the city, said billing the distillery for sewer water on the back end, rather than the front, is a “straightforward” first step. He said installing technology to gradually release high-strength wastewater in a steady flow will help, too. “One thing we don’t want to do is disrupt the city sewer system,” Smith said.

“I’m in favor of giving it a try,” said council member Phil Wedekind.

Tom Fitzwilliams, an MSA Professional Services engineer consulting for the city, said the discharge would have to be sampled and tested regularly. “The concept is solid,” he said. “The devil is in the details.”

Financial negotiations will have to wait for the conclusion of the city’s rate study toward the end of the year. Once firm numbers are available, the committee will take up the matter and make a recommendation to the full council.

As for issues not related to finances, the committee will resume discussions at its next monthly meeting, with staff set to work with Driftless Glen representatives in the meantime.