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Council OKs proceeding with water line improvement bonds
However, scope of project may increase
new deh city council 6-21-16 pic web
Pictured is a stretch of Main Street in Great Bend that could see water line improvements. - photo by Tribune file photo

 Citing the long-running need to revamp the city’s water system, the Great Bend City Council Monday night gave a green light to proceed with the development of a bond financing plan to fund the multi-million-dollar project. This was only the first step in the process and no further action was taken.

The city was initially looking at a $3.1 million effort to improve water lines in the downtown area. But, with interest rates at historic lows and an aging water network, the council instructed city officials to look at expanding the scope of the project to include more lines.

“Tonight is the kickoff for the bond issue,” said David Arteberry of Kansas City-based George K. Baum & Company, the city’s advisors on bonds. He was present to discuss how the bonds would be paid for and the time line required to make them happen. 

His presentation was based on the $3.1 million. 

Over 15 years, this comes $245,000 per year payment that would require a 15 percent increase in water rates. And over 20 years, the payments would be $205,000 and require a 12 percent rate hike.

Since these are long-lasting improvements, Arteberry said he had no trouble recommending the longer payoff.

However, “I am leaning towards 15 years,” Councilman Wayne Henneke said. The rate increase was still relatively small and the city would wind up paying more interest if it took the additional five years.

Others on the council echoed these sentiments. It was also the consensus of the council that if it opts for a larger project, the 20 year payoff made more sense.

“There’s no right or wrong answer,” Arteberry said. 

The downtown piece is the first of five phases and it seemed like a manageable portion to bite off first, City Administrator Howard Partington said. But, “it’s entirely up to the council what you want to spend.” 

If the size of the project is increased, he said, it would have to be re-engineered by the city’s on-call engineering firm Wichita-based Professional Engineering Consultants. But, that probably wouldn’t be a big deal.

Arteberry said his firm can still go ahead and start the paperwork. The council has until the end of July to decide what it wants to do..

The next steps would then be authorizing the bonds to be sold on Aug. 15 and final approval by the council on Sept. 19. The city should get the money in October.

“We’ve been working on this project for a while,” City Administrator Howard Partington said.

Bond issues are not something the city takes lightly. So, the next water improvement bonds could be years away, adding to the urgency to tackle more now.

In 1999 when the city purchased the water system, Partington said. “We inherited a lot of problems.”

At that time, there was a $2.5 million bond issue to improve lines on 10th Street from Washington to McKinley and Grant Street to what was then Central Kansas Medical Center.

Last October, the council authorized Partington to proceed with preparations for a bond issue for around 9,000 feet of water line improvements. The main priority was replacing the current 10-inch cast iron line along 10th Street and in the downtown area with a 12-inch plastic line.

There are other streets, such as Broadway and Stone, and many in residential areas that need lines replaced as well.

It is estimated that about one third of Great Bend is served by old, cast iron water lines that date back as far as 80 years. These all could need to be replaced eventually.

In addition to moving forward with the bonds for the new work, the council approved refinancing $1.8 million in older debt. Arteberry said this could save the city around $128,000.

This action is independent of the other and does not play into the rate increases or project expansion.