The city of Pilot Rock has decided to try its hand at grabbing some of the stimulus funds for its city water project.
At a work session Monday night, Brad Baird, president of the consulting firm Anderson-Perry and Associates, brought the idea of applying for stimulus funds through the state Safe Drinking Water Revolving Loan Fund before the board.
At first, some board members were reluctant. The council had previously approved beginning Phase I of the project, replacing piping from the city's water reservoir to the junior/senior high school and replacing a three-block line down Alder Street. The city planned to pay for this with $466,000 of its own money. The board members didn't want to slow down the work.
But Baird urged the council to hear him out.
"The way to look at it is, it's one hell of an opportunity," Baird said. " ... this is just to give you a chance to look at what's coming, what's available now. A lot of cities are jumping all over this. ... It's an incredibly lucrative opportunity."
He said the goal of the stimulus money is to beef up projects and packages so they would do more than originally intended. He said the city could always fall back on its original plan to take on just Phase I at this time, but all the city has to do to look into getting stimulus dollars would be amending its application.
"Take this out for a drive and see what kind of deal we can get," Baird said. "If it comes back and the deal isn't that good than stick with what you've got. But you don't want to miss the opportunity is the point I'm trying to make."
The Phase I project will cost Pilot Rock its $466,000 savings. The project's budget is about $650,000, based on 2005 prices, as a rough number and calculated in a $2.50 water rate increase, Baird said.
Baird offered several funding strategies for the city to bridge the gap stimulus dollars and principal forgiveness won't cover. Those options included raising water rates, using the city's $466,000 for a down payment on a loan, using rental dollars from the Masonite property to pay off a loan or a combination of those options.
These additions to the project would move the total cost to about $2 million.
The added costs would be to add new water lines to all four wells in town, add pump stations to the two wells on the Masonite property and install meters that can be read by radio on all the city's 650 residential meters.
But the real opportunity, Baird said, is stimulus dollars could pay anywhere from 0-50 percent of that cost. There also could be principal forgiveness, further reducing the city's actual cost.
"This is unheard of these days," Baird said. "You'll never have this opportunity again, in my opinion."
Throughout his presentation, Baird cautioned this was the most recent information he'd received from the state and the information was always changing.
"This is a moving target," he said. "... Every time you turn around, it's different. Every time you turn around, it's better."
Until the application is in and the state replies in writing, the city won't know exactly what kind of deal it will get.
"They'll come back and say, 'here's your deal,'" Baird said. "At that point you can say, 'wow!' if it ends up being better or if it's worse you can say, 'naw, I'm going to stick with that (the Phase I plan),'"
At the council's Tuesday night meeting, it approved asking Anderson Perry to apply for the stimulus dollars.
Doing so will add about six weeks to the project. The application has to be in by April 15 and the state will let the city know if its application has been approved on May 1. That's when the city will learn what kind of deal it has gotten and whether it wants to follow the stimulus-funded plan or the original city-funded Phase I plan.
"So we're willing to make gamblers out of ourselves and roll the dice because we're in a smoke and mirrors game and we could maybe get the pea under the shell," said Councilman John Standley. He emphasized that no matter what, Phase I will happen.
Whether the council decides to accept the stimulus funding or fund itself for Phase I, the city will be able to go out for a bid by May 15 and look at starting construction in July.