The Hancock-Henderson Quill, Inc.

Public Works Committee Discusses 7 Million Dollar Water Project

by Michael Rodeffer, The Quill

Prior to the regular council meeting, the full La Harpe City Council met at 6:00 p.m. on April 9th at the La Harpe City Hall.

Lynn Armstrong, from the USDA's Rural Development Galesburg office met with La Harpe City Council members: Brian Covert, Greg Wisslead, Randy Shumaker, Ryan Olsen, Jerry Burford, Dave Clover, Mayor Kat Hasten Reed, Clerk Lucretia McPeak, Treasurer Maggie Link, City Attorney Chris Scholz, Employees Tim Graves and Monalisa Graves and IMEG Representatives Eric Moe and Megan Crook.

Armstrong is the area specialist with the USDA's Rural Development office in Galesburg. Her area consists of Hancock and 10 other counties.

USDA Rural Development has authority to make loans to public bodies and not for profit corporations in rural areas to construct, enlarge, extend, or otherwise improve water and waste disposal systems.

Related costs such as land, engineering, legal, environmental analysis, interest during construction and certain other costs are eligible as well.

Applicants for these loans must be unable to get credit elsewhere at reasonable rates and terms. Projects in rural areas and communities of not more than 10,000 in population are eligible.

he loan repayment period shall not exceed 40 years or the useful life of the facility.

Armstrong informed the council of the checklist and steps that need to be followed.

A pre-application form which has been done has deemed the City of La Harpe eligible for loans or grants.

Armstrong explained several of the forms which need to be filled out. The Mayor, the City Attorney and the engineering firm besides herself will have several forms to complete. The engineering firm will collect all and submit all as a total package to the USDA state office.

The city will be required to publish a notice of intent to file the application and also be required to hold a public meeting to inform the public.

As for water rates, Clover asked Armstrong what the worst case scenario would be if no grant money was approved. IMEG rep, Megan Crook said $66 for just water should be worst case scenario.

Currently the first $1000 gallon of water costs $19.67. Armstrong had calculated 3, 4 and 5 million dollar loan amounts and suggested the base water rate would probably need to be between $45 and $54 per month just for water.

Armstrong said once the loan and grant monies are established Rural Development will tell you what the recommended rates need to be to be able to repay the loan.

Randy Shumaker, Public Works Chairman, explains he would like to see the water rates raised gradually instead of one huge jump once the project is complete.

Armstrong noted that typically grant money in the state is limited to 1 million dollar grants for up to a 5 million dollar project.

Any project over $5 million has to go to the Washington D.C. federal office for approval and what she would do would be to ask for additional money from the federal office.

Armstrong was hoping for at least a $2 million grant.

The meeting adjourned at 7 p.m.