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Finance committee authorizes promissory notes, accepts state financial aid for 2024 lead service‑line work
Summary
The Wausau City Council Finance Committee approved issuing up to $2,172,756 in taxable general obligation water system promissory notes and accepted a state financial assistance agreement that provides principal forgiveness and a low‑interest loan for 2024 lead service‑line removal projects.
The Wausau City Council Finance Committee voted Tuesday to authorize issuance of up to $2,172,756 in taxable general obligation water system promissory notes and to accept a state financial assistance agreement that will cover most of the city’s 2024 lead service‑line replacement costs.
City staff said the 2024 work totaled about $5.6 million, and the state offer documented in the financial assistance agreement is for $4,922,001.91. Mary Anne, a city staff member, said the agreement includes $2,700,000 in principal forgiveness and roughly $2,000,001.72 structured as a 10‑year loan at a 0.25% interest rate. "So a pretty good deal to, you know, do a project of almost $5,000,000 with a a $2,000,000 loan at point 25%," Mary Anne said.
Mary Anne told the committee the city has already paid Community Infrastructure Partners for the work and that the lead service lines have been removed; the promissory notes and the state agreement are intended to provide the financial resources to cover those expenses. She also said the state review disallowed some expenses totaling $251,004.07 and staff will return to a future finance meeting with options for covering that gap, including using general fund reserves or rolling the shortfall into the city’s 2025 general obligation promissory note issuance.
Committee member McElhinney asked why those expenses were disallowed and whether the city could push back. Mary Anne said the disallowed costs included professional/legal fees billed through the project partners and that the state (CIP review staff) "just kind of drew a line in the sand" on what professional services they would cover. She said staff has discussed the issue with Community Infrastructure Partners and will follow up as needed.
The committee approved the action on a voice vote. The motion to authorize issuance of the promissory notes was moved by Henke and seconded by McElhinney; the motion carried unanimously by voice vote with no roll‑call recorded.
Next steps noted by staff include returning to the finance committee with a proposal for dealing with the roughly $251,004.07 of disallowed expenses and completing closing on the state financial assistance agreement.
