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New Richmond approves 10‑year lead service line replacement plan with 3% customer financing option
Summary
After an EPA-mandated inventory identified about 100 lead or unknown water service lines, the council approved a 10‑year replacement program whereby the city replaces the public side and homeowners finance the private side with a 10‑year loan at 3% interest, subject to PSC tariff approval.
The New Richmond City Council approved a plan to replace suspected lead service lines across the city over a 10‑year program after staff reported results of an EPA-required inventory.
Staff said the inventory identified a little over 100 known or suspected lead service lines. The proposed program would replace roughly 10 lines per year for 10 years. Under the policy as discussed, the city would pay to replace the service from the water main to the shutoff (typically in the yard or driveway) and homeowners would be responsible for the portion from the shutoff into the house to the meter. Staff told the council the customer’s private portion can cost around $3,500 on average.
To reduce the immediate cost burden on residents, the utility commission recommended offering a 10‑year loan to customers at a 3% interest rate rather than a 0% rate; staff said the difference between 0% and 3% across the program would reduce utility revenue by roughly $66,000 and the 3% rate aligns with current borrowing/market assumptions. Staff noted the program still needs Public Service Commission (PSC) approval and that the utility could adjust annual funding levels if conditions change.
Council members asked whether the city would hire contractors directly or require homeowners to hire plumbers; staff said the policy currently anticipates homeowners hiring their contractor, though the city could consider contracting for both sides to gain efficiencies but that approach would add administrative and liability considerations.
A motion to approve the lead service line replacement program with a 3% customer loan over a 10‑year term carried on roll call.
What’s next: Staff will file required tariff updates with the PSC, outline implementation logistics, continue to pursue grant funding, and prepare homeowner outreach materials.
