Herald Journal - Enterprise Dispatch - Delano Herald Journal
Howard Lake’s portion of WWTP will save taxpayers $10 million

June 8, 2009

By Jennifer Gallus
Staff Writer

HOWARD LAKE, MN - Since the decision was made about one year ago to partner with Annandale and Maple Lake for the construction of a joint wastewater treatment facility, the City of Howard Lake sought Minnesota Public Facilities Authority (PFA) loan money.

“We were going to seek PFA funding regardless, because of the low interest loans they offer,” said Howard Lake City Administrator Kelly Hinnenkamp.

Timing couldn’t be better as the application for infrastructure financing, which includes financing the forcemain construction from Howard Lake to the wastewater plant, was approved just as funds were made available from the 2009 federal American Recovery and Reinvestment Act (ARRA).

The stimulus financing package from ARRA consists of a $3,998,476 Clean Water Revolving Fund loan for 20 years at 1.076 percent interest, as well as principal forgiveness in the amount of $5,999,619, which does not have to be repaid.

Essentially, 60 percent of the cost of Howard Lake’s forcemain project will be eliminated because of this package from PFA.

“Compared to market rate financing for the project,” PFA Chair Dan McElroy informed the City of Howard Lake, “we conservatively estimate this financing package will save local taxpayers approximately $10,163,546 over the term of the loan.”

The city was congratulated by McElroy, and was told that the project will, “simultaneously create jobs, promote economic recovery, and improve water quality.”

“The cooperative efforts of all three cities have allowed us to capitalize on the grant opportunity for not only the City of Howard Lake’s forcemain project, but the entire joint regionalization project,” Bolton & Menk Engineer Barry Glienke said.

Because the cost of construction of the forcemain from Howard Lake to the plant is the obligation of the commission, all three cities will benefit from this 60 percent decrease in anticipated costs.

“The future impacts of rate increases for all three cities will be lessened because of this grant,” Glienke said.

Howard Lake city residents will see an additional direct savings on the $766,000 buy-in to the joint commission, because the grant will cover 60 percent of this cost, as well.

The grant will also make a 60 percent dent in a $2.7 million price tag for various changes that were made at the regional wastewater plant to handle the additional flow generated by Howard Lake, according to Glienke.


 

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