Cedar Falls council approves up to $11 million sewer planning loan for water-reclamation design

The Cedar Falls City Council on Aug. 18 approved a resolution to institute proceedings for a loan and disbursement agreement and the issuance of not-to-exceed $11,000,000 in sewer revenue capital loan notes to pay for design costs related to the city’s water reclamation improvements project.

City staff said the Iowa Finance Authority’s state revolving fund offers a three-year, no-interest planning-and-design loan that will be rolled into a low-interest construction loan when the project is bid. City staff told council the facilities plan for the project is complete and that the funding will cover design work authorized under an earlier professional services agreement with Strand.

Tyler Griffin, speaking for city staff, described the loan structure and noted the required public notice was published Aug. 7. Griffin said the planning loan is a standard step taken to finance design work before construction financing is secured.

During public comment, a resident raised unrelated concerns about other trust funds and sewer-account activity; staff and the mayor clarified the loan item before council was not related to those trust funds and redirected the commenter accordingly.

The council voted by roll call; the clerk recorded all members as voting in favor and the motion carried.

The planning loan covers design-phase costs only; construction financing and final project scope will be addressed when the city seeks bids for the larger construction phase. Staff said the planning loan term is three years and will convert to construction financing under the state revolving fund’s standard terms when the city advances to bidding.

Next steps include completing design, finalizing the financing package for construction, and returning to council with documents for construction-phase approvals and any required contract awards.