Board Continues to Negotiate Funding Offer

SEELEY LAKE - The Seeley Lake Sewer District (SLSD) board had a special meeting April 15 to discuss details of a funding offer they received in March. The board is currently negotiating some aspects of the offer in attempt to lower the projected monthly rates.

Representatives from the United States Department of Agriculture Rural Development (RD) were on hand to further explain the offer.

The funding package consists of $5.7 million in grants and $4.4 million in loans for the construction of the proposed wastewater treatment plant and Phase I of the collection system.

According to RD’s estimate, the users in Phase I would be paying $167 per month for operations and debt service. That figure would drop as future phases go online.

District Manager Greg Robertson and the board feel that the monthly cost could be significantly lower if some of the conditions of the funding are changed. The district is also looking for places to cut construction and operating costs.

RD Community Program Director Steven Troendle explained how RD calculated the monthly figures. RD used numbers off the SLSD funding application and from the district’s Preliminary Engineering Report.

Of the estimated $167 per month, $88 is for operation and maintenance, $15 for short-lived assets, $30 for the debt service for the treatment plant and $34 for the debt on Phase I of the collection system.

Robinson feels that the operating cost will be significantly lower based on the other five sewer systems that Missoula County runs. He also sees an opportunity to save by sharing employees with the Seeley Lake Water District.

Troendle explained that the part of the reason for the high operating cost is the small number of users in Phase I and stressed the importance of constructing Phase II. The monthly figure would drop to $141 per month when Phases II users come online and would drop further as future phases are added.

If possible, adding a few streets worth of properties to the first phase would help to some degree.

As to the debt service for the treatment plant and the short-lived assets, RD originally spread the full cost over the first two phases. RD is allowing the district to look into spreading the cost over the full district because the full district will see benefit in the future.

The treatment facility has been designed to treat the full district with minor modifications for future phases.

Phase I will be responsible for all the debt for the construction of its collection system but the district is looking at ways to cut costs.

One possible way to save money is to not pay for restoring private property when they are hooked up. $500,000 in savings or extra grants could cut the monthly cost by $11 per month over 40 years.

The district remains committed to connecting to individual homes for free but discussed limiting the lengths of the free hookups to a set distance from the sewer main. It was also discussed whether businesses should also be hooked up for free.

Troendle said any of the changes to funding scenario would need to be submitted so that RD could make sure it doesn’t impact the grant loan split.

“We want to be working with you guys in any of these scenarios that you’re wanting to run to attempt to get savings in this thing to where it’s affordable,” said Troendle.

RD representative Dan Johnson expressed concerns that the process needs to be moving forward. If Seeley Lake doesn’t vote this in, the money will go back into the national pot and can’t be used on another Montana project.

“We still need to keep moving this based on the numbers we have today. Make this happen and then we can work at reducing those costs,” said Johnson.

Phase I of the collection system includes all commercial property on the east side of Highway 83, between Cedar Lane and Redwood Lane. Also included are all properties between Tamarack Drive and Highway 83 that are north of Redwood Lane and south of Larch Lane, including all properties fronting Larch Lane and Pine Drive, north to Cedar Lane.

Phase II of the collection system covers the land between Highway 83 and the lake, north of Lindey’s to the Heritage building. Also included is the residential land south of Cedar Lane and west of Tamarack Drive, north of School Lane and East of Pine Drive.

The next regular SLSD board meeting is scheduled for 5:15 p.m. April 21 at the Missoula County Satellite Office.