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Commission to consider KDHE construction loan resolution for Bucyrus sewer project
Summary
County staff outlined a KDHE temporary construction loan and project budget details for the Bucyrus sewer project and asked commissioners to approve a resolution this afternoon to authorize application and bond‑counsel review.
County staff told commissioners on Feb. 26 that the Kansas Department of Health and Environment (KDHE) has offered a temporary construction loan for the Bucyrus sewer project and that the county will ask the commission to approve a related resolution at the afternoon meeting.
Shane, a county staff member working on the project, described the loan as about $1,420,000 to bridge construction costs. He presented a project budget that totaled roughly $4.4 million after adding construction, contingencies and associated costs. Funding sources included approximately $1,250,000 in county ARPA funds, $1,500,000 from KDHE small-town grant, a community development block grant (CDBG) of about $305,000 and $1,000,000 from the city of Spring Hill.
Shane said KDHE indicated principal forgiveness of about $852,000, which would reduce the county’s eventual loan obligation to about $570,000, though final amounts depend on actual bids and potential changes. "That is, temporary nature during the construction process of the Bucyrus Sewer Project... We're applying $1,250,000 in county funds that is coming from the ARPA moneys," Shane said.
Shane told the commission that bond counsel must review the loan agreement before final execution and that the county had received KDHE’s acknowledgment to go out to bid. He cautioned that USDA participation looked uncertain because several staff changes within USDA rural development in Kansas have slowed communications. He also noted the county is working against deadlines for CDBG expenditure.
What was decided and next steps: Staff asked the commission to approve a resolution in the afternoon session authorizing the loan application and to forward documents to bond counsel for legal opinion. No final loan signature or construction contract was executed during the study session.
The county also flagged potential easement-acquisition timing and costs and said condemnation historically takes six to eight months if required. The project timeline and final county loan obligation will depend on bid results and interagency approvals.
