Paddock Lake to apply for $5 million USDA loan for water system improvements

/Photo by bruno rebelo via freeimages.com

/Photo by bruno rebelo via freeimages.com

The Paddock Lake Village Board on Wednesday approved applying for a $5 million loan from the US Department of Agriculture for improvements to the village’s municipal water system that would connect wells on its east side to newer wells on its west side and allow customers to be added to the system.

The vote to apply for the grant was unanimous. Trustees Dick Fish and Gary Kaddatz were absent.

Before the vote, the village conducted a required public hearing outlining the situation with the current water system and the proposed improvements and costs.

The village currently has a system that supplies water to mostly homes in what is known as the Dells neighborhood, on the lake’s east side. It was constructed in 1958 and largely operates with its original equipment, said village administrator Tim Popanda, who led the presentation. It has 287 customers.

The Dells system delivers safe drinking water, but the state does not allow it to add customers due to capacity problems and a lack of a redundant water source. Despite having hydrants, it cannot be used by fire engines, though it can be used to fill fire department tenders (tankers).

The Dells system is “at the end of its useful life,” Popanda said.

In 2008, with five subdivisions platted on the west side of the village west of Highway 83 and south of Highway 50, the village started construction of a west side water system to serve those planned homes. Two new wells were dug. Developers were to pay for the system through special assessments.

But the downturn of the economy in 2008-2009 led to those developments being put on hold and the developers eventually not paying their assessments. The land passed into the hands of banks and eventually the village.

With the current project, the village proposes connecting the west side system with the east side system through a trunk line running along Highway 50. That connection will provide the redundant source needed to allow the east side system to expand as needed, Popanda said.

As the trunk line goes in, Central High School will connect, but other properties along Highway 50 will not have to connect until Highway 50 is reconstructed in 2022 or so, Popanda said.

Only properties abutting Highway 50 will have to connect to the new system. No one on a private well who is not along the Highway 50 corridor will have to connect to the village water system, officials emphasize.

Village officials estimate a total cost of just under $5 million to cover:

  • Improvements to the two original east side wells.
  • Improvements to well three on the west side so it can become the redundant water source for the current system.
  • The water main down Highway 50.
  • Service connections to Highway 50 properties.

The USDA loan was the best option for financing, Popanda said, because it offered a 40-year term at 2.75 percent interest. That should result in about $205,000 in annual debt service.

The village expects to be able to eventually pick up about 90 water system users along Highway 50 — maybe more if development begins again, Popanda said.
“We need to keep the annual costs as low as possible so as to not shock the current users,” Popanda said.

The loan will be paid back through a combination of funding sources, including revenue from existing and future water system users, special assessments for those added to the water system along Highway 50, general fund unrestricted reserve funds already earmarked for water system debt service and the tax incentive district created for the west side development area, Popanda said.

If the loan is approved this fall, construction of some aspects of the project could begin as early as winter 2017-18, Popanda said.

Alternatives such as only renovating the east side wells or extending a line to the Bristol municipal water system were about the same cost or more expensive, Popanda said.

There was no extended public comment on the project and the only person in the audience is one of the few homeowners on Highway 50. That resident asked why more formal notice of the hearing was not made to effected property owners.

Village President Terry Burns said there would be more opportunities for the public to have a say.

“Tonight is just a basic overview,” Burns said. “We’re not approving (spending) $5 million dollars tonight, because we don’t have $5 million to approve.”
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