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City plans to ‘authorize’ 100 percent of the bonds for $57 million plant PDF Print E-mail
Friday, 11 August 2017 12:27


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National Beef will sign contract with City to pay for 70 percent, but bonds will be issued by City



By EARL WATT

• Leader & Times




During Tuesday night’s Liberal City Commission meeting, City Manager Mark Hall and Liberal City Commissioner Jack Carlile discussed the upcoming plans for the replacement of the wastewater treatment plant, and in the discussion, Hall indicated that no decision has been made between a water plant that would be city-only, and a water plant that would serve both the City of Liberal and National Beef.

But documents obtained by the Leader & Times indicate a “commitment” to the joint venture.

In a memo dated June 21, Hall told the Kansas Department of Health and Environment, “The City of Liberal would like to take this opportunity to express our commitment to the Regional Wastewater Treatment Plant Approach (specifically alternative 2) outlined in the facility plan report prepared by HR Green. The City and National Beef are currently working out the details of funding construction cost sharing.”

Hall pointed out that the “City understands the significant cost savings that will be realized for the residents for embracing the Regional Wastewater Treatment Plan Approach because of the economies of scale.”

No plan has been submitted to the KDHE yet, according to KDHE spokesman Matt Keith, and having a public hearing on the plan will only take place if the plant is a discharge plant, which it is expected to be.

“It depends on the final request or what the application looks like,” Keith said. “We do require a public comment if it requires discharge. It will depend on what the city asks for.”

In the preliminary memorandum of understanding sent from the City of Liberal to the KDHE, a financial agreement states the City will authorize “general obligation or utility revenue bonds” to fund 30 percent of a joint facility.

For National Beef’s portion, the City will also authorize “special obligation revenue bonds” that will be “secured only by the revenues received by the City pursuant to a contract with NBP” to finance 70 percent of the costs including the engineering costs. Since the City will be authorizing the bonds, should National Beef not be able to make the payments, the residents would have to honor the bond payments, which would either be paid with higher water rates or increased taxes.

The KDHE offers low interest loans for these types of projects, but the city has declined to use the plan. According to the KDHE, there are strict guidelines on how much customers can be charged to service the loans.

“Basically, from a funding standpoint, it depends whether or not we are involved with loan funding,” Keith said. “If a city is using our loan funding, then there are conditions — fair and equitable billing, things like that — that have to be met. If a city is not using KDHE funding, we are strictly look at the permitting side from an engineering standpoint.”

Once an official request for a permit has been made to the KDHE, they will evaluate the proposal, and if discharge is involved, they will hold a public comments hearing.

According to Keith, the City has the option on its own whether or not to host a public comment period before requesting the permit for a joint wastewater treatment plant which Hall indicated was what the City of Liberal’s intended to request.

During the Tuesday night meeting, Hall indicated that a Liberal-only engineering plan was 85 percent complete but was suspended until the joint plan was considered.

Carlile questioned if Mayor Joe Denoyer was aware of the joint plan which according to the memorandum of understanding would cost $57.65 million, but Hall said emails were sent to all commissioners.

No public hearings have been announced for the combined wastewater treatment plant or a Liberal-only wastewater treatment plant.

 

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The High Plains Daily Leader and Southwest Daily Times are published Sunday through Friday and reaches homes throughout the Liberal, Kansas retail trade zone. The Leader & Times is the official newspaper of Seward County, USD No. 480, USD No. 483 and the cities of Liberal and Kismet.  The Leader & Times is a member of the Liberal Chamber of Commerce, the Kansas Press Association and the Associated Press.

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