Commissioners green light acceptance of second state loan
Posted: Friday, June 6, 2014 6:00 pm | Updated: 1:06 pm, Tue Jun 10, 2014
By Robbie Schwartz
MONROE — Commissioners on Tuesday voted to approve additional funding through the Governor’s Water Supply Program for completion of the Hard Labor Creek Reservoir, though it will not require as much as originally thought.
The reservoir is trending about $6 million under budget, according to a presentation to the Walton County Board of Commissioners by project manager Jimmy Parker, senior vice president of Precision Planning Inc. The lone bad note was a wet winter has resulted in a delay of a few months of the final completion date for the dam — from January 2015 to March or April of the same year. Otherwise news was good from Parker, who noted stream and wetland mitigation for the project is 100 percent complete while work on the dam varies from 20 to 95 percent complete depending on the component. Social Circle-Fairplay Road relocation work is expected to wrap up for the most part this summer while most of the work on Mount Paron Church Road has finished and the road is now open to traffic. Officials are even starting to work on a plan for the recreation options that will be offered at the 1,370-acre lake.
But money was the focal point of last week’s discussions. The projected cost at completion for the Hard Labor Creek Reservoir is $85 million, which includes about $11.3 million from local funding and then a combined $47.7 million in bonds issued by both Walton and Oconee counties, who are working together on the project. The budget also includes a $20 million loan from the Georgia Environmental Finance Authority, awarded to the project in 2012 as part of the Governor’s Water Supply Program. Now the project has reached a point where local officials are ready to accept the second loan from the Governor’s Program, though Parker said the project will likely only require $10.3 million of the $12 million allocated. Like the first loan, the duration is for 40 years with no interest and no payments during construction. There are also no closing costs or prepayment penalties but unlike the first loan, where there was a single balloon payment due at 40 years with 1 percent simple interest per year, the second loan sets the interest rate at 2 percent once construction is complete, with the first five years paying only interest while the remainder of the payments will be for principal and interest.
“We want to make sure people know that we have set aside money and are working on designing a payment plan so that when this money comes due, whomever is on the board then will not be stuck with this,” Chairman Kevin Little said. “We are working on the details right now, but we will be putting our money into interest bearing accounts or find some way to invest it and be prepared for the future.”
The second loan is needed to essentially wrap up work and get the reservoir up and running, with funds to be used to finish the dam and remaining road work as well as the raw water intake structure.
While the project is trending under budget, with the possibility of the savings increasing as a 10 percent contingency was built into each line item, Parker said it was time for leaders to turn their eye toward the longer range financial goals. While the second loan would wrap up the project, it would also afford the county to set aside about $4.3 million not only as a operations and maintenance reserve fund but also to go ahead and design about 60 percent of the water treatment facility that will be needed in the future. As the project stands now, Walton County will get about 37 million gallons a day from the reservoir and Oconee County 15 MGD, but the water output could easily be expedited if there was a catalyst - if either county were to lure a large industry that would demand a lot of water.
Commissioners voted unanimously to accept the second loan amount of $10.3 million, of which Walton County will be responsible for $7.33 million based on its 71.2 percent ownership in the regional project.