Leader Blues

Tuesday, July 07, 2009

TOP STORY >> Authority to borrow funds for water line

Leader staff writer

The Lonoke-White Public Water Authority board voted Tuesday to borrow $721,000 from the Arkansas Natural Resources Commission to begin the project to bring water to the area from Greers Ferry Lake.

The board did so after hearing reports that indicated the project can be built even if Cabot does not participate.

Current members of Lonoke-White Public Water Authority include Grand Prairie, Jacksonville, North Pulaski Water Association, Vilonia, Cabot, Ward, Austin, Lonoke, Furlow, Beebe and McRae.

The borrowed money will be the authority’s match for a federal grant of about $800,000. The combined funds of more than $1.5 million will allow the board to hire a project manager, and other professionals needed to continue the project that has now been in the planning stages for about 15 years.

It will also pay Jacksonville engineer Tommy Bond who has worked on the project for several years without pay.

“You owe me about $150,000 right now and you don’t have any way to pay it unless you close on this loan,” Bond told the board.

Bond came to the Tuesday meeting with new cost estimates for the project that could allow the project to move ahead without Cabot, which is not willing to participate at a level that would require raising its customers’ rates.

Instead of $65 million, Bond said the project could be completed for $45 million if a traditional sand filter treatment plant was built instead of one using membrane technology.

ANRC had agreed to provide a $15 million grant and a $50 million loan.

He said during the meeting that if his calculations were correct, and if ANRC will give a $15 million grant and a $30 million loan, repayment of the debt would require collecting $5 a month from 34,000 customers instead of 46,000 customers, a difference of 12,000.

Afterward, he confirmed that the new calculations were to eliminate the need for Cabot’s participation.

Earlier, Terry House, manager of the combined Grand Prairie and Bayou Two water associations, said the project could move forward even without Cabot’s 1.2 million gallons a day water allocation in Greers Ferry Lake.

The Cabot Water and Wastewater Commission has said publicly that it will not give up the allocation. But House said the allocations belonging to Ward, Grand Prairie, Lonoke and North Pulaski Water Association are sufficient.

Vilonia, which is a member of the LWPWA but does not have a water allocation from Greers Ferry Lake, can use its allocation from a project that was completed several years ago, House said.

Cabot doesn’t need water from Greers Ferry Lake except possibly as an emergency backup source. The city-owned wells and a contract for surface water with Central Arkansas Water should supply Cabot until 2070.

For future water, the Cabot Water and Wastewater Commission voted last month to try to get the last 7 million gallons a day allocation available from Lake DeGray and use CAW’s infrastructure to get the water to Cabot.

Bond told LWPWA board members that although many don’t need the water now, their situations could change with little notice. Wells dry up, he said.

Ward Mayor Art Brooke told the members that before they could do anything else, they had to decide about the $721,000 loan.

“If we don’t get past this issue, we’re back to square one,” he said.

Woody Bryant with Grand Prairie/Bayou Two added that if the board didn’t move forward it would lose the $15 million grant for the project.

The yes votes to proceed included Cabot’s vote. At stake, if the project isn’t built, is the 110 acres at Cove Creek where the intake and treatment plant will be built.

ANRC will hold the mortgage on the property.

But bond attorney David Menz pointed out that with the way the area is growing, if the LWPWA doesn’t build the project, someone will. So selling the land to pay the debt should not be a problem.

Howard Williams, of the ANRC, the last person on the agenda for the Tuesday meeting, reminded members that ANRC needs signed commitments from project participants by Sept. 1, so contracts can be let by February 2010.