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Cities Receive $702M to Fund Water ProjectsLock Icon

4 min read

Arkansas cities will soon see a flood of money for water projects.

Last month, the Arkansas Department of Agriculture’s Natural Resources Commission approved $702.3 million in funding for 122 water and wastewater projects, the agency’s largest total ever awarded for water and wastewater projects.

Communities will use the money — most of which comes in the form of low-interest loans — for projects such as replacing meters and distribution lines for drinking water systems or water tanks, said Chris Colclasure, director of the Agriculture Department’s Natural Resources Division. For wastewater projects, the funds will be spent on efforts such as replacing distribution lines and infrastructure at wastewater plants. “That can be physical repairs of lagoons to the actual components of the water treatment itself,” Colclasure said.

Chris Colclasure

Chris Colclasure

A total of $633 million was provided in loans, $69 million in loans with principal forgiveness and $223,013 in grants.

But not all cities were thrilled with the awards.

The city of Keiser in Mississippi County probably won’t accept a $4.6 million loan to renovate its 50-year-old wastewater system because of the cost to repay the loan.

 

Keiser Mayor Rick Creecy said that if the city accepts the money, it will have to raise water rates to the community of 751, which has “a lot of retirees.” The average water bill will jump from $53 a month to $119, “and that’s going to be a little tough for some of our citizens,” Creecy said.

The city has until Aug. 18 to make the decision on taking the loan, but the answer will likely be no. Creecy said that he had hoped that part of the loan would have its principal forgiven.

If the city rejects the loan, it will take a targeted approach to replacing what it can on its sewer system. It will also seek grants.

“As long as we don’t have torrential rains, it operates fine,” he said of the sewer system. “It’s just when we get so much rain so fast, it floods and gives us issues.”

Tremendous Need

Colclasure said there is a “tremendous amount of need” for water projects in the state. “Arkansas has some really outdated community infrastructure.”

Colclasure said that a water plan for Arkansas released in 2014 projected that water and wastewater infrastructure required expenditures of $9 billion by 2024, mainly because of the age of the systems.

“Some parts of our state have lost population, which means they don’t have as many ratepayers to help maintain the system, and that causes a significant issue at times,” Colclasure said.

Smaller water departments are encouraged to merge or join with a larger system, “so that you can spread the cost out,” he said.

Once the projects are completed, in about three years, Colclasure expects to see an improved infrastructure. “So that’s less boil orders” and fewer administrative orders from regulatory agencies such as the Arkansas Division of Environmental Quality or the Arkansas Department of Health, he said.

*The money comes from a program of the U.S. Environmental Protection Agency that allows funding to treat water for a specific list of emerging contaminants in drinking water. (Source:  Arkansas Department of Agriculture’s Natural Resources Commission)

The improvements also will inspire greater trust from the citizens of those communities in their infrastructure, an assurance that they’re going to be able to have dependable water, Colclasure said.

The money for the projects came from federal and state funds. The Arkansas Department of Agriculture’s Natural Resources Commission receives federal funds through the Environmental Protection Agency’s Clean Water State Revolving Fund or its Drinking Water State Revolving Fund.

The commission matches those federal funds and they are placed in the State Revolving Fund, where the money is loaned to communities at low-interest rates, Colclasure said. The cities pay the loans back with interest, and then that money is loaned out again, he said.

“One of the things that we’re able to do with the recurring federal funds is that we can keep our rates lower than the current market,” he said. “That incentivizes communities to do projects, and two, it allows them an easier source to get financing, especially for some of the smaller communities.”

Little Rock Water

The Little Rock Water Reclamation Authority will receive a $65 million loan to fund its water improvement projects.

It has about 1,400 miles of pipes, which is the same distance from Little Rock to Las Vegas, said Greg Ramon, CEO of the Little Rock Water Reclamation Authority.

It will spend the money on two major projects: underground piping and its three wastewater treatment plants.

The LRWRA will rehabilitate its wastewater pipes, which “minimizes the digging, reduces the costs and provides us with a great pipe,” Ramon said. Those pipes are expected to have a lifespan of 50 to 100 years, he said.

To rehabilitate them, the LRWRA will use a method called pipe bursting. “We force a high-density polyethylene pipe through the existing clay pipe,” Ramon said. The clay pipe is broken and “this new pipe becomes the host pipe,” he said.

Another method involves using a fiberglass liner in the existing pipe. “It’s almost like an inverted sock that goes into the sewer system,” Ramon said.

 

The LRWRA also will spend about half of the loan amount on improvements to its wastewater plants, biosolids handling or biogas handling. “There’s so many components to a treatment plant that we have to continue to upgrade and improve,” Ramon said.

Some of the improvements will be to the treatment plants’ screens. “It’s amazing how many things come to our treatment plants — from toys to boulders to chunks of wood that fell in from somewhere,” he said.

The debt service for the $65 million loan will be supported by the LRWRA’s existing rate structure, and ratepayers will not be affected, the utility said.

“The strongest part of our mission is to protect public health and the environment,” Ramon said.

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