Council backs tax-exempt financing request for wastewater plant bell press replacement

The town council approved a resolution authorizing tax-exempt financing to support replacement of a bell press at the regional wastewater treatment plant operated by the Joint Facilities Committee.

Staff explained the bell press being replaced was installed in 1991 and has exceeded its designed useful life; the proposed financing is structured as a tax-exempt lease under the Internal Revenue Code rather than a conventional bond. Tony, the wastewater facility director who presented the request, said Joint Facilities would be responsible for the lease payments and that the cost would be covered from user fees collected by the joint utility.

Council members sought clarification about whether the town would be using its credit for other communities served by Joint Facilities and whether taxpayers could be at risk in the event of a default. Town staff said the dollar amount — roughly $837,000 — is small relative to the town’s outstanding debt and that there is no direct appropriation of East Hampton general fund tax dollars for the equipment; Joint Facilities holds the obligation and user fees fund the payments. Staff noted most of the installation costs could be paid by existing Joint Facilities capital funds, with the financing intended to avoid exhausting those reserves.

A motion to adopt the resolution was made and seconded; the council voted to adopt the resolution authorizing the tax-exempt financing. Staff said future installation costs could lead to additional financing requests if needed.