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HILLSBOROUGH WRESTLES WITH RISING COST OF POWER PLANT

Climbing equipment and materials prices may drive the bill up another $13-million.

Hillsborough commissioners characterized it as a no-brainer when they unanimously approved one of their most costly no-bid construction projects ever three years ago.

But the "maximum" price of expanding the county's waste-to-energy plant keeps going up.

Commissioners will decide today whether to shift as much as $13.6-million toward the eastern Hillsborough County project. A favorable vote will increase its expected cost to $139.7-million, up more than 35 percent from an original estimate of about $102-million in June 2004.

Those involved with the project say it should still cost less than if commissioners had sought competitive bids for the work or locked in a guaranteed price. But at least one commissioner is skeptical.

"The bottom line is, we don't know that because we didn't go out (for bids)," said Commissioner Brian Blair, who joined the board after the initial approval, and has voiced objections to it since.

Residential customers won't have to pay for the increase through rate hikes. The money will come from reserves and by delaying part of another project.

Only two commissioners remain from the board that initially approved the no-bid approach, Jim Norman and current Chairman Ken Hagan. Neither returned phone calls seeking comment.

County officials and their consultants say the lack of competing bids has nothing to do with the price runup. They say the project has faced a perfect storm of rising skilled labor and construction materials costs that have hit power plant construction particularly hard.

"The base price of equipment is just costing us through the nose," said Dan Strobridge, a vice president with the county's independent consulting engineer, Camp Dresser & McKee. "Add to that, the power industry is just booming worldwide, meaning the companies that build the pumps and motors are just overloaded with work."

That prices for this project have gone up only as much as they have is good news, he said.

Beth Leytham, a spokeswoman for Covanta Hillsborough Inc., which is building the expansion, echoed his assessment.

Strobridge, the county consultant, still thinks Hillsborough made the right call. Had the project gone to bid, the delay would have allowed companies to see the dramatic spikes in labor and materials costs, and would have adjusted offers accordingly.

" The county, I'm sure, would have gotten a price that made its eyes rolls back in its head, the prices would have been so high," Strobridge said. "So I think the county made the right decision."

Bill Varian can be reached at varian@sptimes.com or (813) 226-3387.

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