This outdated water tower off Railroad Street in Leesburg may be replaced by a new 300,000-gallon tank near the Lee County public schools. (July 6, 2013)
LEESBURG, Ga. -- A water system that is badly in need of repair may be in line for substantial improvements -- pending grant approval and a decision next month by the Leesburg City Council.
Council members are considering two proposals that would result in the construction of an elevated water tank and the replacement of underperforming water lines.
The price tag for both projects is more than $1.8 million. The good news is that almost $700,000 of that expense could be covered by federal and state grants. And, the remaining loan amount could be obtained at an interest rate of 1.4 percent.
Chad Griffin is project engineer for Carter & Sloope, consulting engineers for the city of Leesburg. Griffin outlined the proposed work recently for council members.
Griffin said the city previously submitted an application for $725,000 in loan financing from Georgia Environmental Finance Authority for a 300,000-gallon elevated tank.
According to the application, the new tank would "provide necessary storage and fire protection for a community that is in need of both fire protection and excess storage.
"With the installation of the new tank, the existing deteriorating 100,000-gallon water tank, which had lead paint on it, will be abandoned."
GEFA initially rejected the Leesburg application, Griffin said, but recently funded the project "when the federal government released a second wave of money."
Actually, GEFA did better than approve the loan money. It agreed to forgive $181,250 of the principal, meaning Leesburg would have to borrow just $543,750 for the tank project.
Additionally, Leesburg may be able to obtain up to $500,000 in a combined Community Development Block Grant and GEFA Georgia Fund grant to implement replacement of outdated and faulty water lines.
The total cost of this separate project, Griffin said, is $1,192,544, of which Leesburg would have to provide $692,544, also at a lending rate of 1.4 percent.
"This will help Leesburg in not losing so much of its water," Griffin said. "By this being a water conservation issue, it drops the rate from 2.4 percent to 1.4 percent."
Griffin noted the city replaced most of its water meters in 2011. This work, which cost $651,480, was accomplished with the assistance of a $195,444 grant from the 2011 Drinking Water State Revolving Fund.
"Those meters are your cash registers and were not working properly," Griffin said. "It's been accomplished and you are seeing the revenues from that."
"The bottom line is you could have $2.6 million in work done since 2011 and $876,694 of that was grant money.
"For every dollar that is spent, the City of Leesburg is acquiring 34 cents in grant funds," he said.
Leesburg Councilman Bob Wilson questioned Griffin about which project should be financed if the council could afford just one.
Griffin said the elevated water tank is the priority, but some line replacement will be needed even if the council does not proceed on water line replacement, assuming the grant is approved.
City Attorney Bert Gregory noted that Leesburg has been conservative in past fiscal decisions to keep the municipality's finances strong.
"When you are talking about spending this amount, you are concerned because other cities are having financial trouble," Gregory said. That is something we don't want to do given the conservative nature of this council."
City Clerk Casey Moore says she estimates the council could finance both projects at an additional cost of about $35,000 a year.
Moore said the council financed water system improvements in 1998 and still owed about $400,000 on that loan. The debt load annually is about $65,000, Moore said.
"I would suggest paying off that note and we have the ability to do it," Moore said. "Then we replace that $65,000 debt each year with about $100,000."
The City Council just implemented a rate increase for water, sewer and trash customers that is expected to generate an additional $157,700 each year.
Moore said the need for water system improvements was considered when the council determined the exact price adjustment for water customers.
The water system projects, if approved, would likely begin in 2014, Griffin said.