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City approves $4.491 million water‑revenue bond to replace lead service lines
Summary
The commission approved a $4,491,000 water‑revenue bond for lead service line replacement; staff said roughly two‑thirds of the loan will be forgiven under federal subsidies, leaving the city responsible for about $1.5 million, with principal payments beginning in 2031 and a maturity date of Sept. 1, 2050.
City finance/staff summarized a loan and bond package for the lead service line replacement project and the commission approved the bond resolution by roll call at the Feb. 17 meeting.
Greg told commissioners that the state and federal funding structure results in substantial loan forgiveness: "the North Dakota Industrial Commission approved a $4,491,000 loan requested by the city... that loan forgiveness will amount to about $3,000,000," he said, explaining that the federal subsidy and state program reduce the city's obligation to roughly $1.5 million. Greg said the loan will mature Sept. 1, 2050, the interest rate for the borrower is effectively 0 percent (with a small administrative fee retained by the state), and principal repayments will not start until 2031 after the project is complete.
Commissioners asked whether the work covered service lines into private residences; staff said the replacement will run from the main to the house (the service line into the home). Commissioners then moved and approved the bond resolution on a unanimous roll call.
Staff said the city’s share of repayment will come from the water and sewer utility fund and that the bond resolution was prepared by bond counsel; further implementation steps will proceed through the utility fund and project schedule.
