With the city’s new waste water treatment plant near completion, city leaders are frantically trying to determine how the Water Pollution Control Authority will make the first $2.46 million loan payment in 2012.
One tax board member is concerned there won’t be enough money.
“What concerns me the most is defaulting on these payments,” Ed Norman said during the WPCA meeting last Wednesday. “Everyone is surprised we’re not collecting money toward those payments.”
That was originally the plan.
In 2008, the city approved the project and started construction on the new $53 million plant. The WPCA will owe about $2.46 million a year for the next 20 years.
At the time, the WPCA proposed an extra, flat fee for each sewer hook-up in Ansonia to appear on bills starting in 2008.
The plan was to phase in the fee so that by the time the loan came due in 2012, there would be enough money stored up to start making the payments.
But the extra charge was never added to the sewer bills.
Too Much Money
The additional sewer fee would have added about $100 per unit to the sewer bills, a designation that would include churches, office buildings and individual apartments.
The fees were scheduled to increase as the loan came due, according to a presentation given by the WPCA in January 2008. (Article continues after the document.)
But those payments would have been too much money for struggling homeowners, said Acting Mayor Stephen Blume.
Residents came out and complained at three public hearings on the topic, Blume said.
“The numbers were so high,” Blume said. “We’ve been trying to get money from several different avenues. So we didn’t bill and we looked at other avenues to reduce this debt.”
‘This Is Terrible’
Blume said those other avenues — such as trying to get stimulus money or other state grants — have not panned out.
The city was even set to send Mayor James DellaVolpe to Washington D.C. to talk with U.S. Senator Christopher Dodd about the situation, before DellaVolpe had to undergo heart surgery last month.
“The WPCA has not been sleeping. This takes up my whole day late into the night. We are working hard to resolve this,” Blume said. “This is terrible. We were forced to do this. We don’t want a new plant. We were not given any support by the state.”
The new plant was mandated by the state because the old plant was outdated and didn’t comply with updated environmental standards. As of last week, construction was 71 percent complete, according to the WPCA.
The city is looking at other payment possibilities that would decrease the burden on sewer users. One possible solution is as paying the loan through an increase in the city’s tax rate. Residents are already looking at an 8 percent tax increase under a proposed budget for next year.
Blume said that is only one of several ideas that have been thrown around.
A decision needs to be made by the end of the month, Blume said, so that bills can start going out in time to collect the money.
“We’re not going to default. We’re going to make the payments,” Blume said. “It’s just a matter of dollars and cents. We are exploring every avenue we can.”
