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Hot Springs puts $16.35M water plan and $27.24M wastewater plan on state water plan to preserve funding options
Summary
City council voted to submit the 2025 drinking water facility plan ($16,349,697) and the 2025 wastewater facility plan, Alternative 3 (MBBR) ($27,241,000) to the South Dakota state water plan so the city can apply for low-interest loans, grants and loan forgiveness in future funding rounds.
The Hot Springs City Council voted to submit two facility plans to the South Dakota state water plan on motions that passed by voice vote, giving the city the ability to seek state funding later for upgrades to the city's water and wastewater systems.
Jim Jones, with engineering firm AE2S, told the council that placing the plans on the state water plan does not obligate the city to build the projects now but is required to be eligible for future state loans and grants. "You're under no obligation to seek state funding for any of those projects by having them on the state water plan, but you cannot ask for state funding if they are not on the state water plan," Jones said.
The drinking-water plan includes four recommended projects that together total $16,349,697. Jones highlighted work at the Evans pump station as an early priority: the facility's pumps and related piping, controls and metering would be rebuilt or upsized so a single pump could deliver roughly 2,300'2,500 gallons per minute while preserving a second pump for redundancy. Jones described the scope as new pumps, motors, VFDs, piping, a master meter and updated SCADA controls.
On the wastewater side, council approved submitting the 2025 wastewater system facility plan, Alternative 3, a moving bed biofilm reactor (MBBR) approach, with an estimated cost of $27,241,000. Council members and AE2S staff repeatedly described the wastewater plant as the city's highest priority because of the facility's age, equipment deterioration and odor and safety concerns.
Alderman Randy Graham pressed for action, saying the community has endured the plant's odors and operational strain for years. "It's time we take care of that, folks," Graham said, urging the council to pursue the planning steps needed to secure state assistance.
AE2S recommended a phased approach for wastewater replacement rather than seeking funding for a single, full-scale replacement. Jones said the state reviewers generally prefer phased applications because each phase can be considered separately for loans or grant/forgiveness. He described a likely Phase 1 focused on preliminary and headworks improvements (screening and grit removal) that could reduce staff labor and damage to equipment by removing abrasive material up front.
Jones explained eligibility timelines and next steps: if the city is placed on the state water plan on Oct. 1, 2025, the city will have about two years and three months of eligibility before the plan entry needs renewal. The state evaluates funding applications after a January 1 application deadline and typically notifies communities of available funding packages in March, Jones said. "You have off-ramps up until really you're starting the design," he said, describing public meetings and additional engineering steps that would come before construction.
Council members, the city administrator and AE2S staff said the next steps would include public outreach if the city elects to seek funding: design work, public meetings on proposed rate changes and applications seeking the particular mix of loans, low-interest financing and grant or loan forgiveness that the state can offer.
The council voted to place both facility plans on the state water plan by voice vote. The motions were recorded on the meeting agenda as: "submit application to place the 2025 water system facility plan prepared by AE2S on the state water plan in the amount of $16,349,697" and "submit application to place the 2025 wastewater system facility plan, alternative 3, moving bed biofilm reactor prepared by AE2S on the state water plan in the amount of $27,241,000." Both motions passed.
The council and consultants emphasized that being on the state water plan simply preserves the option to apply for funding; it does not commit the city to proceed with construction or borrowing until later public-review and approval steps.
Votes at a glance: the council approved both submissions by voice vote during the meeting.
Ending: AE2S and city staff said the facility-plan documents are posted on the city's website and that public meetings would be scheduled in coming weeks if the council chooses to pursue state funding.
