City sanctions loan

Jacob Lane · Wednesday, January 22, 2014
Water was the forefront issue, once again, at the first city council meeting of the year Tuesday, Jan. 7 in West Liberty. The council finalized payment for phase one of the water treatment construction project, and talked about phase two.

The council authorized a loan agreement to pay off the the first phase of the water construction project for an approximate total of $1.3 million.

With an interest around 4 percent and other additional equity contributions, the final price tag will be around $1.8 million after all is paid off years from now, according to a report made by Northland Securities, Inc.

The city plans to take care of the loan through yearly payments of $90,000 to $95,000 over the next 19 years, finishing sometime around the year 2033.

Since the council re-examined all the billing when it comes to the water project, the city staff was able to find money, making the payment of phase one more feasible, according to Interim City Manager Lawrence McNaul.

Also, Northland Securities was able to make several small adjustments to the loan as it examined the details, saving the city approximately $76,000 in interest.

"They did secure some of the better rates that were available for us for this project, so it's going to pay dividends for the next thirty years," said McNaul.

The first phase expanded the water plant as well as replaced the iron filter for the first step in water treatment. Construction will be completed around April this year.

The second phase will provide a secondary step in water treatment. Originally electrical dialysis reversal (EDR) was going to be implemented for the phase. However, in recent months the city has begun debating between EDR and reverse osmosis (RO).

The reason; RO systems are a lot cheaper to install, but remove all of the same things an EDR system would from the water. City Engineer for Veenstra and Kim Leo Foley emphasized both systems provide similar results.

He stated they both remove radium, as well as hardness from the water. They also help improve the taste. The big difference occurs with the cost.

"RO used to be about same cost of EDR, but we noticed about two years ago prices of RO were dropping dramatically while the prices of EDR stayed the same," said Foley, "Once we got to the end and we asked for hard bids…the RO came in way cheaper."

Part of the reason is that an EDR system is only made by one company, General Electric. RO systems, on the other hand, are made by a variety of other companies forcing them to compete with each other.

"It [the report] shows the EDR system, just the construction cost, that first cost is $2.1 million. You turn the page and the RO, for the exact same type of system, came in at $1.5 million. That's a $600,000 difference."

He added that no matter which system the council chooses, a system to add fluoride to the water will need to be installed as well.

Also, he said the city will need to look into digging a new well in about five years. Both of the wells in West Liberty are old and have been repaired as much as they will allow.

The council voted 5-0 in favor of continuing to move the study of EDR versus RO forward, but as of yet has not made any final decision on which system to implement.

In other news:

-Mayor Hartman appointed council member Melody Russell to the position of Mayor Pro-Tem, meaning she'll cover council meetings and other events should Hartman be unavailable.

-Hartman named the West Liberty Index the official newspaper of West Liberty, as well as naming the Muscatine Journal as the secondary in case of immediate news.
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