Leader Blues

Tuesday, August 18, 2009

TOP STORY >> Water project hits dry hole

Leader staff writer

Funding problems continue for the 15-year-old Lonoke-White water project that is supposed to connect communities in the central part of the state to Greers Ferry Lake.

Participants were told at the noon meeting Tuesday that Arkansas Natural Resources Com-mission, which is expected to distribute the federal loan money to pay for much of the project, will not bend the rules to make it happen.

The Lonoke-White Public Water Authority, which plans to build the project, can’t borrow money because it has no customers of its own. Only existing systems with existing customers are eligible. And the plan to take on someone else’s customers in name only is not acceptable. The only way the project can get funding is if some of the larger water providers in the group agree to take on the responsibility of borrowing the money.

The U.S. Environmental Protection Agency told the ANRC in a July 23 letter that the project, now estimated at $45 million, is for long-term state water planning and not in response to an existing public health problem which was counter to the requirements for Drinking Water State Revolving Fund money.

DWSRF is the fund through which federal money in the form of a low-interest loan was to be funneled. The project is also earmarked for a $15 million stimulus grant.

When the problem was discussed last week, members agreed that a viable solution was to get a permit from the state Health Department and take on either 77 water customers from Bayou Two or 300 or so from McRae.

Clint McGue, project attorney, told project members Tuesday that a Monday afternoon meeting with ANRC didn’t go well.

“The ANRC has done sort of a 180,” he said. “We’ll have to take a different approach to find $30 million.”

McGue said last week that the options of each member getting a loan to pay their part of the project or for some of the members with large customer bases to borrow the money for everyone were not viable solutions.

This week, he said the only solution was for the members with large customer bases to borrow the money.

“The EPA has decided they must have strict compliance with regulations,” he said. “We’ll need volunteers to get funding.”

McGue said the money is still set aside to pay for the project. But the question that must be answered soon is who will access that money. The deadline for signed contracts for construction is Feb. 17, 2010.

Although there are no firm commitments, representatives from Vilonia, North Pulaski, Grand Prairie and Cabot said they were willing, with their boards’ approval, to consider borrowing the money.

Jacksonville also needs assurance from ANRC that its $24 million loan will not be placed in jeopardy if it also applies for a loan to help build the Lonoke-White project.

Cabot is committed to paying $35,000 a month for the project. Bill Cypert, spokesman for the Cabot Water and Wastewater Commission, said Cabot won’t pay any more than that.

Woody Bryant, the newly hired project manager and member of the Grand Prairie Bayou Two Water Commission, said he had expected more resistance.

“The consensus is better here today than I thought it would be,” Bryant said.

The meeting comes on the heels of a recent Lonoke City Council meeting, which voted unanimously to accept their share of financial responsibility if the association gets its grant, and also to buy its allocation of water from the Mid- Arkansas Water Alliance.

“We won’t have to go up on our rates unless the grant comes through,” Mayor Wayne McGee said.

Leader senior staff writer John Hofheimer contributed to this report.