Mitchell council moves to segregate utility revenue, clears bond step for wastewater project

Mitchell city staff told the City Council on Tuesday that a targeted surcharge will reserve existing water and sewer revenue for debt service on the CW‑10 wastewater treatment plant Phase 2 so the city can close on a State Revolving Fund (SRF) loan.

Council adopted Resolution R2024‑466 to add the surcharge; staff said the measure does not raise overall rates now but segregates a portion of existing revenue for the project’s debt service. In the same meeting the council approved Resolution R2024‑567, which authorizes issuance and sale of a revenue bond to finance the sewer facility improvements and pledges project revenues for repayment. Staff reported the total project cost at $12,899,436.

City staff explained the SRF loan process and said the surcharge and bond resolution are required procedural steps before loan closing. City staff also said the surcharge will be recorded as a separate line item in the utility account to ensure revenues are available for debt service.

Council members asked procedural and timing questions; staff said segregating the revenue now does not increase customer bills but is a prerequisite for finalizing state financing. The council approved both resolutions by motion.

Next steps: staff said the city will proceed toward closing the SRF loan and will return with bond documents and any required adjustments; the council discussed scheduling additional budget work sessions if election results or ballot measures (notably Initiated Measure 28) affect revenue projections.

Provenance: Topics introduced at SEG 1191 and last discussed at SEG 1284.