By MARK EVANS
STE. GENEVIEVE HERALD
Bloomsdale officials will be making some tough decisions in the next month or two.
Cochran Engineering personnel laid out exact dollar figures for the proposed water projects for the city at the May 12 board of aldermen meeting and also looked at how the city can pay for them.
The price tag for the total, four-stage project is $1,917,625, while the first step – replacing the 79,000-gallon stand pipe with a 200,000-gallon elevated water tank – would be $1,077,500 by itself.
Cochran’s David Van Leer and T.J. Garbs went through the project’s financing and how annual and monthly payments would look.
If the entire project is taken on and financed at one time, based on a $2 million loan at a 3.25% interest rate, a yearly payment of $105,363 for 30 years could be expected. That works out to $8,780 per month.
They also went over how this amount can be covered. The half-cent infrastructure sales tax has been bringing in an average of about $93,000 a year. Garbs’ figures showed the city putting a bit more than 2/3 of that into the payment, or $67,000 a year. Another $20,000 of the $29,000 or so current annual revenue from water users could also be thrown into the pot.
The remainder could come from a water and sewer rate increase. The Cochran team surprised Monia the previous month by showing that the city’s rates are well below neighboring entities like the city of Ste. Genevieve, the cities of Perryville, Bonne Terre, Cape Girardeau, plus Public Water District No. 1, that handles most of the county, and the water district that supplies Perry County.
A spirited discussion about raising rates took place later. Both Cochran and the mayor had proposed possible rate increases to consider.
Either proposed increase, which would bring the city more in line with its neighbors, would add another $17,915 a year, thus bridging the gap.
“The nice thing is we’ve not gone into any reserves,” Monia said. “The general (fund) can offer some assistance to that and we’re not doing that, either.”
The project is a big one, but appears to be a doable one.
“I’m not trying to sugar coat it,” Monia said. “I can quite honestly say I won’t be sitting here 30 years from now; I won’t be on Earth 30 years from now. For us to take on something like this is huge.”
He said he hates to cause some future mayor and board to “walk into quite a debt.”
“But, I also feel pretty confident, the way this is structured, that hey, I may have left you with debt, but I did it with good intentions because (a.) We need it, (b.) We can see how we can pay for it and (c.) It’s all-around better for everybody,” Monia said.
“The other thing we’re not accounting for in any of these numbers is growth,” Van Leer said. “Growth creates more revenue, and that’s only going to help you in this situation.”
Monia did have one bit of bad news for both Van Leer and the aldermen.
“Where that tank goes, we don’t own enough property,” he said. He said land bordering the site is available for purchase, though, and should present “no hurdle.”
WATER TANK COULD BE DONE
Van Leer and Garbs also ran the figures for just tackling the first phase to begin with. Just to install the 200,000-gallon tank would cost $1,077,500. A $1.1 million loan at 3.25% interest would be a $57,950 annual payment or $4,829 a month.
The aldermen, though, seemed more included to tackle the whole project, rather than leaving the replacing of the aging transite lines for later.
“Materials aren’t going to get any cheaper, Ward 2 Alderman Chris “Sappy” Basler said. “Labor’s not going to get any cheaper; interest rates are just going to go up.”
“That transite pipe has long since paid for itself,” Ward 2 Alderman Brandon Shortt added. “I think everyone of us will agree that we dodged the bullet not having any water main breaks this year.”
The venerable asbestos-concrete transite pipes have lasted nearly 60 years, including the sub-zero stretch of weather this winter, that Shortt mentioned.
The second, third and fourth phases of the project would replace the 1963 four-inch transite pipe with six-inch plastic pipe.
“If we replace that tank, disrupt the water a little bit, obviously, we could cause some pressure variations and maybe bust some of that pipe,” Shortt said.
While the annual payments will be smaller to begin with, he noted that, “A year from now, we’re going to have to choke this down. What have we really saved, if we save anything?”
“You’re absolutely going to spend more.” Monia said.
HOW SHOULD RATES BE INCREASED?
Just how to increase water and sewer rates were a matter of some debate.
Right now the city charges $15 a month for the first 2,000 gallons of water used. An additional $4 is charged for each additional 1,000 gallons. Bloomsdale’s customers pay an average of $32.69 per month for water.
Monia’s plan was to increase the minimum charge to $25 a month and to raise the additional charge from $4 per 1,000 gallon to $6.
Basler expressed concern about raising the minimum. He argued that it could be difficult on senior citizens, who probably only use the minimum in most cases. He suggested getting all the increase from the additional usage.
Monia and city clerk Lynnette Randoll replied that this would not raise enough money. The base rate, they said, will need increased.
Monia stressed that the need for the proposed increase is because the rates have been the same since 2014.
“If this had been $2 every year, nobody would have thought anything of it, and we’ be on our way,” he said.
He requested figures by next meeting on how much the increase would raise the bill on residents using 3,000, 7,000 and 10,000 gallons a month.
A DOABLE JOB
Monia expressed pleasure with the information from Cochran.
“This is now our pill,” the mayor said. “So, it’s up to us to come to you and explain how we want to move forward with it.” He added that he “couldn’t be happier” with the information Cochran provided.
“We can do this, and sure we’re going to be tight, but probably not as tight as we think we are,” Monia said. “And, we’ve not touched anything we’ve got [in reserve]. That’s the good thing.”
Monia wanted the others to think on the situation and be ready to make a commitment at the June 8 meeting.
“The takeaway from tonight is, think real hard on this and let’s see what kind of a decision we can come up with at our next board meeting, to see how we would like to move forward on this,” Monia said.