2007-02-17 / News

Commissioners to seek Ohio EPA loan for plant

By Charles Prince

NEWARK - Licking County's Water and Wastewater Department will seek a Water Pollution Control Loan Fund (WPCLF) loan to fund the Buckeye Lake Sewer District plant expansion.

County Commissioner Marcia Phelps, Water and Wastewater Director Ken Salsberry, Assistant Water and Wastewater Director Kevin Eby, engineering consultant Dale Kocarek, P.E. of R.D. Zande & Associates and Joseph Robertson of Seasongood & Mayer meet with representatives of Ohio EPA's Division of Environmental and Financial Assistance last Friday. The meeting confirmedinformation about the lower interest rate WPCLF loans detailed in a Feb. 3 Beacon editorial.

"They will allow us to apply," Salsberry reported. "Kevin, Dale and I will work through it (the application) and get it submitted." He said most of the data needed for the application had already been done as part of the permitting process. However, an archeological survey wasn't done.

Salsberry said the district would definitely qualify for the standard 3.25 percent interest rate and might qualify for the 2.75 percent small community rate or the 1 percent hardship rate. The hardship rate requires a service area population of less than 10,000 and an average median household income of less than $38,000. Salsberry said he is working with Sue Spiker of the Licking County Planning Commission to get the population and income figures.

"There's a lot to be done if this is the direction we go," Phelps said. "There is no guarantee we will qualify. They are willing to work with us."

She said the Division of Environmental and Financial Assistance representatives want to talk with John Owen of Ohio EPA's Division of Surface Water who handled the review of the plant's new operating permit. Phelps said after that conversation, they are willing to come to speak with commissioners.

"It (a WPCLF loan) won't have much effect on the annual payment," Salsberry said since the WPCLF loan has a 20 year term and the district planned to issue 30-year revenue bonds. The district is currently projecting a $572,882 annual payment for 30 years based on 4.62 interest. A 1 percent WPCLF loan would save $63,061 a year. The total savings to customers from reduced interest would be nearly $7 million. Both Salsberry and Phelps agreed that the new plant won't last 30 years.

"I think we should proceed," Commission President Tim Bubb said. "We're in short term notes now. We have some time to explore financing with Ohio EPA. Let's take it as far as we can go."

Salsberry said the district's application will probably rank fairly well due to the consent decree with US EPA and Ohio EPA. DEFA Chief Greg Smith told The Beacon in late January that the WPCLF program will have about $250 million for 2008 projects versus $400 million for 2007 projects. All 2007 projects that were ready to go were funded. If project requests exceed available funds, projects will be ranked on the basis of environmental benefit.

A handful of customers have been attending Salsberry's weekly updates with commissioners. "I'm real pleased that you went over and talked to Ohio EPA," Merv Bartholow said. "We're always open to suggestion," Commissioner Doug Smith responded.

Salsberry also briefly reviewed a revised spreadsheet with commissioners. It sets a rate of $40 per month per EDU for 10 months in 2007, increasing to $43 per month in 2008, $45 per month in 2009, $47 per month in 2010, $49 per month in 2011 and $51 per month in 2012. The original proposal called for a $49 per month rate this year. The overall rate increase to 2012 was 115 percent.

This latest spreadsheet, which doesn't include any of the possible savings from lower interest rates, represents a 76 percent increase to 2012. This version does cut the annual increase for salaries/ benefits/travel from 9 percent to 6 percent and the annual increase for contractual services from 4 percent to 3 percent.

The current $3,000 residential tap fee is doubled to $6,000 with all of the increase applied toward retiring the plant expansion debt.

"The thing that scares me about the $6,000 tap fee is the extra $3,000 for the STEP system," Salsberry told commissioners. The spreadsheet also increased the projected annual increase in EDU's from 26 a year to 52 a year. "I'm not comfortable with doubling the number of new taps from 26 to 52," he added.

Salsberry's next update meeting with commissioners is tentatively set for 11 a.m. on Monday, Feb. 26.

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