IRON MOUNTAIN — Bacco Construction of Iron Mountain is the apparent low bidder for a water and sewer project in the city, presenting an offer that’s $1.6 million less than the engineer’s estimated construction cost of $17 million.

Three bids were opened Monday during a special city council meeting. Bacco’s total of $15,403,788 came in below bids of $16,249,911 from James Peterson Sons Inc. of Medford, Wis., and $19,827,785 from Payne & Dolan Inc. of Gladstone.

The water portion is funded through a $10.64 million loan at 2% interest from Michigan’s Drinking Water State Revolving Fund, plus a $2.666 million grant from the same source. The work chiefly involves water main and service line replacements in the areas of West A, West Hughitt and East C streets.

The city wants to replace sewer infrastructure while streets are torn up for the water project, but financing for that portion is less certain. A low-interest loan is being sought through USDA Rural Development, but it’s not known when a decision will come through.

Under terms of the DWSRF portion, a tentative notice of bid award will be needed by July 7. City staff and project engineer Coleman Engineering of Iron Mountain will review the bids and schedule a special council meeting to act on the engineer’s recommendation.

The sewer portion of the project was roughly estimated at $6 million by Coleman. About 425 lead service lines are expected to be replaced in the water portion.

The DWSRF funding was awarded through the Michigan Department of Environment, Great Lakes and Energy.