The Utah Board of Water Resources authorized an 85% state cost share of up to $8,645,000 Tuesday for the Lake Creek Irrigation Company’s system upgrade, including a larger transmission pipeline and a screened diversion, with the loan set at 1.26% interest over 30 years.

Board staff said the project, serving about 1,600 acres and 367 shareholders roughly four miles east of Heber in Wasatch County, will replace an aging diversion structure, add a screening structure to stop debris, and upsized pipe capacity (replacing existing 16-inch mains with new 30- and 24-inch lines and adding a 16-inch loop). That work is intended to reduce head loss, correct pressure deficiencies, improve water quality and reduce evaporation and seepage from an open pond that currently receives diversions.

Ben Merritt, Division of Water Resources staff, told the board the project’s estimated total cost is $10,170,000 and that projected economic benefits from increased crop production total about $407,000. Staff applied a prorated interest rate of 1.26% because the system serves both secondary and agricultural uses and recommended setting the applicant’s repayment at 85% of the economic benefit (about $346,000) and funding up to 85% of project cost, capped at $8,645,000. Staff reported a benefit-cost ratio of 2.0.

Greg McPhee, president of Lake Creek Irrigation Company, thanked the board during the meeting and did not add substantive changes to staff’s presentation.

The board voted unanimously to authorize the recommendation. The motion was offered by Board Member Blaine Ipsen and seconded by Board Member Dana Vanhorn.

Next steps: the project will move to the implementation phase under the terms approved by the board; staff estimated annual payments at about $347,800 over a 30-year repayment period under the proposed loan terms.