By BOB SHRALUKA
WZBD.com
Decatur’s board of works and safety and its city council on Tuesday approved a $21 million project which will remove all lead service lines throughout the city and replace numerous aging water mains.
The $21 million isn’t quite as severe as it seems on the surface. A loan-grant agreement calls for $5.5 million grant (no payback) and an interest-free loan of $2.5 million to come the city’s way, along with a $10 million low-interest loan at 2.898% and a $3 million loan at a rate a little higher but still lower than through the open market.
And the loans may be spread out over a period of 35 years.
The grant and interest-free loan will be provided by Indiana’s State Revolving Fund (SRF).
Such a project is mandated by the federal government to target lead service lines across the nation.
Jennifer Wilson of Crowe Accounting was on hand at the meeting to explain all manner of financial matters involving the project.
Also attending, as they have for two previous meetings, were Ben Adams, engineer, and Chris Harrison, business development manager, both with Commonwealth Engineers.
RATE HIKE: Where the project will be felt soon is in city water rates. An increase of $4.40 for minimum users is scheduled to take effect January 1.
Now, an additional $6.60 will be added for a total of $11 for the water line of a utility bill.
When the addition will be tacked on is undecided at this time. It could be in January or it could be later in the year as a rate study will be needed and an ordinance approved before the $6.60 can be added.
The city originally was moving toward a $12.5 million project to get the overall lead-removal project started. But Adams was told by SRF representatives that if the city went as high as $18 million, it would receive the grant and the interest-free loan.
So local officials decided to accept the offer and also to go all the way to the $21 million.
“(Doing) the $18 million was the only way we could get the grant, “Mayor Dan Rickord said.”These numbers are crazy; I know they are high. But we have to do this; we are being mandated.”
“You will never get it any cheaper than it is right now,” Adams remarked.
“It’s a great deal and that money likely will not be there in the future,” Wilson added.
“It’s an incredible opportunity for Decatur,” City Attorney Anne Razo said of the SRF offer.
“If we don’t take it, they will pass it off to someone else,” the mayor remarked.
ONE OF JUST 14: He added that over 100 other Indiana communities – also under federal mandate – have applied for SRF funding, but only Decatur and 13 others are getting the sweet offer.
Part of the project will involve replacing numerous aging water mains – some 50 to 100 years old – among the city’s approximately 25 miles of such mains.
Rickord said that after the city emptied a water tower for painting a few years ago, “We had 50 main breaks in a month and a half. So that shows you how old our system is.”
Replying to a question, Adams said the project could take as long as 12 to 18 months. “It’s a massive undertaking, it really is,” he said.
The mayor noted that “some of these projects should have been done 10 years ago. We’re not picking projects that are fancy, fun. These things just have to be done.”
“I think it’s a good deal; we should take it,” said Craig Coshow, a member of the board of works.
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