Tuesday, January 9, 2001
Abilene eyes $20 million in grants for
pipeline project
Federal money would help pay for construction
costs
By Jerry Daniel Reed
Reporter-News Staff Writer
Sharply higher water rates in Abilene may
be easier to swallow if a $20 million federal grant can be snagged.
City officials are looking into the possibility that Abilene's
wholesale water customers - neighboring towns and water districts
- could qualify for $20 million in federal grants to help pay
for construction of a pipeline from O.H. Ivie Reservoir near Ballinger
to Abilene.
"If we could get $20 million from the feds, that would certainly
be worth looking at," City Manager Roy McDaniel said. A disadvantage
is the project could be stretched a few months by the grant application
process.
On Thursday, the Abilene City Council will discuss options to
pay for the pipeline and a water treatment plant, which are expected
to cost about $61 million. In addition to the principal, the city
will pay at least $32.9 million to finance the project over 20
years through certificates of obligation, McDaniel said.
Certificates of obligation are a finance tool similar to bonds
except they don't require voter approval.
The council meets at 9 a.m. at City Hall, 555 Walnut St.
McDaniel said his staff is also crunching numbers to see if a
state program that allows 34 years to repay a loan would cost
the city less.
The council will look at four options that rely only on certificates
of obligation. The least costly would cost an estimated $93.9
million in principal and interest over 20 years. This option would
pay back more of the principal in the early years, lowering the
amount of interest paid - and the amount water users would have
to pay in higher rates.
Other options cost as much as $102 million.
On March 1, water rates will increase 88 cents per 1,000 gallons,
a 48.3-percent jump for the average residential customer, who
consumes 10,000 gallons a month. The increase equates to 72.52
percent for the average commercial customer, who consumes 80,000
gallons monthly.
The Ivie pipeline and infrastructure should be complete in the
summer of 2002.
Also Thursday, the council will consider accepting a $227,490
bid from Starks Construction to build a skate park in Rose Park.
The project should be completed by late spring, said Mike Hall,
community services director.
Contact staff writer Jerry Reed at 676-6769
or reedj@abinews.com. Check out our Web site at www.reporternews.com
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Copyright ©2001, Abilene
Reporter-News / Texnews / E.W. Scripps. Publications
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