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This relatively straightforward decision is one of the more minor ones as far the Royal Treasury is concerned, but it will determine the fate of Mourningwood. Your decisions in dealing with the sewage of Bowerstone Industrial are:

1. Build a sewage plant. This will create a new building near the docks dedicated to processing sewage. Obviously the good choice, and the cost is not very steep to do so, at 150,000 gold. You'll also notice that Bowerstone Industrial itself looks significantly less polluted, with clearer water and very little smog.
2. Dump sewage into Mourningwood, which of course will turn Mourningwood into even more of a swamp than it already is. The Eco-Warrior Village will become partially flooded with dirty water, and an apparently toxic cloud will hover over the place. On the upside, it costs absolutely nothing, and if you're playing an evil character, well, more bad karma.

There's really no reason here to let stinginess guide your decision. If you want to improve Bowerstone, then building the sewage plant is a no-brainer, as the cost is easily affordable if you've invested anything into real estate by now, and can be made up for in a few minutes of performing level 5 jobs. You're better off simply doing whatever's in fitting with your character.

At this point, you'll return to the Royal Treasury and Hobson will tell you Page wants to meet with you in the old Resistance headquarters. There's no rush, so head over there whenever you're ready.