PORT TOWNSEND — The city has been awarded a $3 million loan for the construction of a $9.9 million water filtration facility designed to remove cryptosporidium, a bacteria that causes digestive problems.
The Port Townsend City Council voted unanimously Tuesday night to defer acceptance of the state construction loan until its next meeting because the city manager and finance director were not present.
“I am confident that everything is being done correctly,” said Mayor David King.
“I thought we needed more explanation about the process.”
Both City Manager David Timmons and Finance Director Michael Legarsky are on vacation this week and so could not explain the effect of the new loans on the city’s overall debt.
“I think the public needs to know how this works and how it fits in the city’s financial picture,” King said.
The vote to postpone the matter was unanimous.
Approval of the resolution authorizing Timmons to accept the loan will be on the agenda of the next City Council business meeting, scheduled for 6:30 p.m. Sept. 17 in council chambers at City Hall, 540 Water St.
Construction of the facility is mandated by the federal Environmental Protection Agency — or EPA — to provide for the removal of cryptosporidium.
Construction of the facility will begin in 2014 next to the current city water facility on Howard Street north of Discovery Road and will take about a year, becoming operational by 2015.
The EPA requires the plants to be operational by Oct. 1, 2014, though exceptions are available.
The loan from the state Department of Health Drinking Water State Revolving Fund is in addition to two loans from the Public Works Trust Fund, adding up to almost $7 million.
The new loan carries a 1.5 percent fixed interest rate with a repayment period of 20 years or the life of the facility, whichever is less.
King said the loan will be repaid through utility fees.
The loan is different than a bond issue because money can be used for other sources.
“If we get the loan and don’t need the money, we won’t borrow it, and it won’t cost us anything,” King said.
“If we do a bond, we need to pay it back whether we end up using it or not.”
Jefferson County Reporter Charlie Bermant can be reached at 360-385-2335 or at charlie.bermant@peninsuladailynews.com.
