City warns of multimillion‑dollar lower reservoir repairs, funding shortfall

City officials told the council the lower reservoir requires immediate stabilization and that preliminary engineering estimates show a large funding need.

The city administrator said the repairs already planned for the lower reservoir ‘‘are going to be between 3.5 and $5,000,000.’’ He told councilors the city has been pursuing several funding sources — including an identified $125,000 potential from rural loans, a referenced MSAP contribution and a possible $600,000 from CDBG — but said those sources would still leave a substantial shortfall of ‘‘2.3 to 3,800,000.0’’ as spoken in the meeting transcript. Officials warned the project ‘‘can't wait another 20 or 30 years’’ and described interim mitigation measures and the need for a capital improvement plan.

Staff described an immediate temporary approach to stabilize the bank: locating clay locally, using underwater epoxy to seal cracks and repacking riprap while awaiting DNRC and grant decisions. The administrator said DNRC funding of $30,000 for repairs had not been confirmed and emphasized the risk of catastrophic failure if the reservoir bank were to fail.

Councilors and staff discussed the fiscal implications: repaying any loan or bond would require a rate analysis, adding principal, interest and reserve requirements that could increase base rates ‘‘an additional 5 to $7 a month per end user’’ according to the administrator's quick estimate. The council did not adopt any financing measure at the meeting, but staff signaled intent to pursue grants, complete engineering and return with cost estimates and options.

The transcript contains several numeric items that are unclear and will need confirmation (see clarifying details).