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Lead commission approves $841,000 revenue bond for Park Avenue waterline
Summary
The Lead commission approved Resolution 2024-11 to secure an $841,000 revenue loan to replace the Park Avenue waterline, changing the design to an 8-inch main and authorizing sealed bids. The loan will be repaid from drinking-water revenues; the Deadwood sanitary district agreed to pay about half of the project cost.
The Lead city commission voted Oct. 7 to approve Resolution 2024-11, a revenue bond authorizing up to $841,000 to fund the Park Avenue waterline replacement.
A state representative briefing the commission said the original engineer estimate was about $1.3 million, but design changes and participation by the Deadwood sanitary district reduced the needed draw to roughly $800,000. "This bond doesn't require, doesn't require a surcharge because you didn't designate that you wanted to do a surcharge for it," the presenter said, noting that the loan will be repaid from drinking-water revenues and that the state would analyze the city’s debt-coverage ratio before closing the loan.
Commissioners amended the project description during the meeting to specify an 8-inch line (replacing a previously noted 16-inch figure) and stipulated to the reading of the five-page resolution before voting to approve it. The commission then authorized staff to accept sealed bids for the Park Avenue project, with bids due by the next city meeting on Oct. 21, 2024.
Why it matters: The bond secures funding for a water-main replacement that staff and the state say is needed to improve system capacity and reliability. The loan’s repayment through water fund revenues, rather than a customer surcharge, means the city will fund debt service from existing water receipts. The commission and staff emphasized the flexibility of drawing only needed funds if bids come in under the bonded amount.
What happens next: Staff will advertise the project and accept sealed bids through Oct. 21; if awarded, project draws will begin and the state will issue the amortization schedule. Commissioners noted amortization was calculated for 30 years in the staff presentation but that other terms may apply depending on program rules.
