Louis Hoglund
A $355,000 upgrade of the New York Mills natural gas distribution station and lines is nearly complete.
About 2,500 feet of 6-inch gas transmission line is included in the project.
The city will bond for the improvements, and the financial consultant for the project is David Drown Associates.
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The bond will be repaid over a 10-year period, through user fees and billings, said Mayor Randy Clarksean. Interest rate on the bond is 4.7 percent.
Repayment of the 10-year bond is expected to have little or no affect on the gas rates to users, at least initially. With energy prices down, Clarksean expects rates to actually lower this year.
The project involved moving distribution stations further out of town, which will enable staff to check the integrity of the gas lines, said Clarksean.
Utilities loan may save NYM taxpayers $1.3 million
In other action at the Nov. 14 New York Mills City Council meeting, the council approved a resolution for funding the cities $4.5 million wastewater treatment plant improvements.
Most of the financing for the project comes from a Minnesota Public Utilities Authority loan of $3.77 million. This Water Pollution Control Revolving Loan Fund loan is for a term of 20 years--at an interest rate of only 1 percent.
The city is bonding for part of the project, through a general obligation bond.
But with the Public Utilities Authority loaning the money for the largest share of the project at only 1 percent, local taxpayers are expected to save about $1.37 million in interest costs, compared to the city bonding for the entire project.
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Economic development loans reviewed
The council lists 10 outstanding loans through the Economic Development Authority.
As of the end of October, more than $300,000 in loans were on the books, with 10 different enterprises. All are current in payments, except one of the businesses.
The city EDA has a Revolving Loan Fund balance of $30,178 available for future loans.
