A project to improve Palmerton's antiquated wastewater treatment plant will cost higher than expected.

Borough Council on a 5-0 vote Thursday agreed to authorize the borough manager and borough solicitor to prepare a $10 million bond issue. Councilmen Randolph Gursky and Jason Behler were absent.

Councilman Richard Nothstein said an anticipated grant the borough hoped to receive through PennVEST hasn't come to fruition.

"The PennVEST grant application has not proven successful," Nothstein said. "It appears we'll need $10 million."

For residents, that means about a $17-18 increase in their monthly sewer bill rate, which could go into effect by Jan. 1, 2011.

However, borough Manager Rodger Danielson said the borough hasn't given up on its efforts to fund some of the project.

"We are trying to get some other funding options," Danielson said. "Right now, it's a grim picture to get grant funding."

Danielson said it will take between three to four months to get the bond counsel involved. The project will go out to bid later this spring, and construction could begin in the fall.

As of January, the project was expected to cost the borough about $6.5 million, however, engineer estimates have pushed the project higher, Danielson said.

In July of last year, council learned the project would cost an additional $1 million more than the $5.5 million originally estimated.

At that time, council agreed to spend $989,000 on a cannibal treatment process, as well as $300,000 for an ultraviolet disinfection system.

Council agreed to that measure after it heard a presentation from Michael Sassaman, of ARRO Consulting Engineers.

Sassaman told council at that time the new option came to light after ARRO and borough officials visited the Jet Tech Factory in Kansas City, Mo., as well as an operating cannibal facility in California.

The new innovative process is now offered with the SBR Treatment Process that is being designed at the borough's wastewater treatment plant, Sassaman previously said.

Sassaman previously said the cannibal process is proven to modify the treatment process so that the plant eats up 90 percent of its own biological sludge.

The annual savings is expected to be about $57,000 per year, said Sassaman, who noted the cost of the cannibal system is $624,000 more than the previously proposed aerobic digestion system upgrade.

The estimated payback on the cannibal process is between six to nine years, after which ongoing savings will be realized, Sassaman previously said. Plus, he said Jet Tech has agreed to double the warranty period from one to two years for the system.

Sassaman said the life expectancy of the system is between 20-40 years. He previously said construction was slated for September, and that the project could be completed by 2012.

Council approved this year's budget with a 1-mill reduction in property taxes. However, as part of that budget, it approved a $10 increase in the monthly sewer rate due to the project.

Also on Thursday, council on a 5-0 vote approved a lease agreement for the Seventh Street field with Palmerton Area School District.

As part of the agreement, Danielson said the borough has agreed to lease the field to the district for one year.

In turn, he said the district has agreed to contribute $7,500 for the maintenance of the facility, which he said it has used more often.

In an unrelated matter, Councilman Chris Olivia said kids have been observed bicycling on the south side of the 200, 300 and 400 blocks of Delaware Avenue.

Olivia noted bicycling is not permitted along the soute side of those blocks, and asked that kids refrain from doing so.