SNOW HILL – Federal stimulus dollars will finance the construction of the new Mystic Harbor wastewater plant, to the tune of $8.8 million.
The funding, which comes from the United States Department of Agriculture (USDA) Rural Utilities Service funding, is split into a loan and a grant.
The Rural Utilities Service loan for $5,062,000 has a 40-year term and a 2.62-percent interest rate. The rest of the money necessary for the new Mystic Harbor plant will come in the form of a $3,738,000 USDA Rural Utilities Service grant.
“We’re not going to get these types of terms commercially at least,” said Ed Tudor, director of Development Review and Permitting.
“We were very lucky to get this,” said Commissioner Virgil Shockley.
“That’s why we don’t want to hesitate,” said Commissioner Bud Church.
Staff had some concerns over the conditions of the loan, which need clarification before final acceptance.
Conditions arising from the 2009 American Recovery and Reinvestment Act, known more simply as federal stimulus funding, require projects funded under the act to buy construction goods from American sources only. According to a memo from Public Works Director John Tustin, the Buy American condition might be in conflict with the county’s contract to buy membrane equipment for the new wastewater treatment plant.
Staff will also seek to establish that the county can borrow money in the future for the north water tower and spray irrigation land under the loan and grant conditions laid out in the offer letter.
Those conditions appear to be included to make certain that the service area has a large enough customer base to service the debt, and that the service area does not take on too much debt, which it would have difficulty paying or which would be a heavy burden on the ratepayer.
The county staff also needs to clarify that the project can be underway within six months, as required under the 2009 reinvestment act.
Staff also had questions, Tudor said, about a provision that appears to require sewer service be provided to anyone in the service area, which is very large, if doing so if feasible. What does feasible mean, in this case? Tudor wondered.
The county must accept the loan by next week.