Smyrna Town Council voted to move forward with a stimulus loan of up to $6 million for sewer system improvements at Monday night’s council meeting.
Council voted 5-1 to approve a resolution authorizing town staff to start the engineering and design work on the proposed sewer projects.
All five affirmative votes were necessary to reach the five-vote supermajority needed to approve the potential borrowing. Councilman Bill Raynor cast the lone vote opposing the resolution.
The $6 million stimulus loan, at a fixed interest rate of 2 percent over 20 years, covers 10 town wastewater projects, consisting mostly of replacements and upgrades for antiquated sewer lines and pump stations, plus the expansion of utilities north of Duck Creek.
As council considered the issue on Monday, Town Manager Dave Hugg said the individual sewer projects will go before council again through the bid process before the town actually incurs debt.
Hugg said it’s really to the town’s advantage to seek the funding and come back to council on the individual projects.
Mayor Pat Stombaugh expressed reservations about the borrowing and referenced the tax increase recently approved by Kent County Levy Court.
“We have to get money back into the people’s pockets to turn this economy around,” she said. “You’ve got to get to the people. If people can’t support these businesses, they’re not going to be here long.”
The 2 percent interest doesn’t mean much if you can’t afford to pay for it, she added.
Hugg continued to stress the importance of the four projects identified as the top priorities: three pump stations and the South Street sewer.
“One way or another, one day or night or weekend, one of those facilities is going to fail,” he said. “I don’t mean to sound melodramatic, but these are investments you need to make.”
Since council previously approved stimulus funding for water system improvements on South Street, it would only make sense to do the sewer upgrades at the same time, Hugg said.
The fact that previous councils didn’t decide to update the infrastructure “is coming back to roost,” he said.
Councilman Bob Riddagh spoke in favor of using the stimulus funding.
“I don’t think we can afford to let this 2 percent go,” he said. “It’s pay me now or pay me later, the way I see it.”
Councilman Larry Thornton also supported the proposed borrowing. Council has listened to the people’s concerns, and the advice of engineers, town staff and the town financial advisor, ant the consensus is “you’re going to have to do it, so why not take the 2 percent and do it?” he said.
Thornton also raised concerns about potential issues with the Environmental Protection Agency (EPA) down the line if the old infrastructure is not upgraded.
“If your raw sewage gets into a creek and starts killing fish, you’re going to pay for it, big time,” he said.
Thornton made the motion, seconded by Memphis Evans, to adopt the resolution proposing up to $6 million in borrowing through the Delaware Water Pollution Control Revolving Fund. The motion passed 5-1, with Stombaugh, Thornton, Evans, Riddagh and Valerie White voting yes, and Raynor voting no.
After the meeting, Stombaugh said she voted in favor of the resolution because the individual projects will have to come back to council for further approval.
Stombaugh said she will be in favor of the projects “as long as the money’s there.”
“It needs to be done, but we need to be very careful what we’re doing,” she said.