Board approves seeking SRF eligibility for proposed $20 million water treatment plant; staff warns of rate impact

The Water and Sewer Board voted Nov. 25 to pursue eligibility for State Revolving Fund (SRF) financing for a proposed new water treatment plant, with staff cautioning the board about potential long‑term rate impacts.

Staff described the project as a 3–5 million gallon plant currently in design with an estimated total cost of about $20,000,000 while design continues. Staff said ARP funds are being used for design work and that being on the SRF list is an early, nonbinding step that preserves eligibility for forthcoming SRF solicitations.

Staff provided a worst‑case illustration that, if the district borrowed the full amount at an SRF rate of about 4.14% with no grant funding, annual debt service could be roughly $1.2 million — an example that translated to about $27.70 per customer per month in the staff presentation. The board discussed USDA loan options, bonds and grant-seeking to reduce borrowing needs; staff noted USDA loans may offer 40‑year terms but include ‘‘Buy America’’ and certified payroll requirements that could increase costs.

From the transcript: "Right now, we're in design ... Our estimated cost right now ... It's 20,000,000," and staff added, "If you did their right now, their rates are 4.14% ... for 21,000,000 is about 1 point let's say, 1,200,000 per year of payment." The board approved the motion to apply for SRF eligibility by voice vote.

Board members directed staff to pursue eligibility, continue design, and seek grants where possible to limit borrowing and rate impacts.