The board heard a staff presentation on a proposed Lake Creek Irrigation Company project to install a new diversion structure, install roughly 12,500 feet of pressurized pipeline in two sizes, add a system loop, install a pressure‑reducing valve and add a system meter to address pressure and water‑quality issues as the service area transitions from agricultural to residential uses.
Ben Merritt, a division staff presenter, said the project is "expected to cost about $10.2 million" and that the company is seeking 85% of eligible costs from the board. Merritt said the division's economic feasibility work produced a benefit estimate of roughly $407,000 and that staff recommended applying 85% of the feasible benefit (about $346,000) toward the board payment recommendation. He also described staff's recommended weighted interest rate of about 1.26%, reflecting separate ag and municipal rate guidelines.
Board members asked technical and timing questions. Chair Mike Davis asked whether engineering and estimated costs were reasonable; Merritt said the project is under design and the figures are preliminary. Merritt told the board staff expects a construction bid later this fall and plans to return to the board for a committal of funds after bids are received.
Board member Dana Van Horn asked why the interest composition differed for the agricultural and municipal components. Shalane DeBernardi (division staff) answered that board guidelines treat secondary (municipal) use at a municipal rate while agricultural components receive the 1% ag rate and that secondary meters had previously been incentivized by a 1% rate to encourage metering.
Why it matters: The project aims to address low pressure, head loss and water‑quality issues as land use changes in the service area. If funded and built, the work would alter conveyance and distribution in a way that staff says will accommodate growth and preserve agricultural service where possible.
What happens next: Staff will return with bids and a final cost for a committal of funds, currently anticipated in October.