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Council hears first reading of proposed galvanized service-line replacement loan program; auditors and council members press for cost details
Summary
Council reviewed the first reading of Ordinance 06-25, which would create a city-administered loan/assessment program to help homeowners replace galvanized water service lines. Staff warned the program could grow quickly depending on homeowner take-up and discussed repayment terms and administration logistics.
Council received a first reading on Ordinance 06-25 on Jan. 28, a proposed galvanized water service-line replacement loan program meant to help property owners replace privately owned galvanized service pipes that the U.S. EPA has reclassified as a higher-priority replacement need.
Councilmember Saad introduced the legislation, saying the EPA “is tasking communities with making sure that we are changing these out to become… replaced with copper or PVC.” Auditor Audra McPeek and staff discussed potential financial exposure and program mechanics. McPeek said the program’s size depends on homeowner participation: “If a 1000 people take this up, that's a $4,000,000 in total loans,” she told council, and added the city could act as the lender and may need to manage liquidity if take-up is high.
The draft ordinance includes a per-property maximum loan cap; section 1(2) sets the proposed maximum loan amount at $4,000 or up to 80% of the total cost of the service-line replacement, whichever is less. Council and staff discussed the range of likely replacement costs — staff noted national averages can vary widely, from roughly $1,500 to $15,000 per property depending on site conditions — and flagged the need for bulk pricing from contractors to limit homeowner costs.
Council members pressed on repayment terms and administrative burden. Councilmember Marcelino asked whether the proposed loan would be repaid over 10 years; staff said the current ordinance contemplates a 10-year assessment but that the repayment period could be set differently by council. Councilmember Fiebel asked whether city staff would need new hires to administer the loans; staff said billing and assessment experience from prior programs would reduce overhead but third-party administration tools could be used if demand rose.
Staff noted an initial appropriation of $200,000 in the infrastructure fund as seed money tied to the city’s 2025 water-main projects and said the full scope of demand will determine future budgeting. Councilmembers asked staff to refine cost estimates, contractor pricing assumptions and the proposed repayment schedule for a future reading.
