The Independence City Council considered a resolution authorizing the city to borrow up to $7,500,000 to fund the design phase of a planned surface-water treatment plant, prompting debate about regional river levels, the condition of existing wells and the urgency of putting city-held water rights into beneficial use.

Finance staff described a proposed bank line-of-credit (a taxable bank arrangement rather than a state revolving fund loan) to cover the design phase. Staff said the city sought state drinking-water revolving-fund financing but was told insufficient funding was available, and that the city negotiated a bank line of credit offering terms roughly comparable to what the state loan would have provided. Staff said the initial expected draw at closing would be about $500,000 to cover issuance costs and early design expenses, that the line allows periodic draws as needed, requires annual interest payments, defers principal until maturity, and allows prepayment without penalty. The interest rate mentioned during the presentation was 6.75% with a five-year maturity for the interim facility financing.

Councilor-level speakers raised concerns about water availability after the U.S. Army Corps of Engineers announced planned reservoir-level changes upstream. One councilor warned that lowered reservoir levels could reduce flows in the Willamette River and said the city risked spending large sums to build a plant it might not be able to use. That councilor urged the council to delay borrowing and seek updated engineering review in light of the Corps’ announcement.

Staff and other councilors countered that existing wells are under stress, with frequent pump failures and reduced well performance in dry periods; planners and engineers recommended moving forward to protect long-standing municipal surface-water rights by putting them to beneficial use. Staff said the design phase work can evaluate these hydrologic issues and that proceeding with design is necessary to secure regulatory timelines tied to water-right use requirements.

A motion was made on the council floor to approve the proposed resolution authorizing borrowing up to $7,500,000 for design of the water treatment plant (referred to in the packet as Resolution 25-622). The transcript shows debate and multiple requests for additional engineering review; the meeting record in this excerpt does not include a completed roll-call vote on the motion.

Key fiscal details from staff: the proposed interim borrowing is structured as a bank line of credit with interest-only payments until maturity, an illustrative interest rate reported at 6.75%, and estimated initial closing draws of roughly $500,000 to cover issuance costs. Staff also said grant opportunities and potential lower-rate loan alternatives were being pursued to reduce future borrowing needs.

Council directed staff to continue outreach on grants and to ensure that engineering analysis during design addresses the Army Corps’ reservoir changes and local well performance.