Libby awaits final OK on loan to begin sewer project

The City of Libby is awaiting final approval of a federal loan in order to begin construction on the Cabinet Heights sewer extension project.

“As soon as they approve it,” Mayor Doug Roll said, “it’s a go.”

Libby’s bond counsel approved the $1.8 million loan from the U.S. Department of Agriculture Rural Development three weeks ago, which was then passed to Rural Development’s Office of General Counsel for review.

Approval takes three to four weeks and is only granted on Fridays, Roll said, which means that the city could hear from the office as soon as this week.

“Eric Hanson from Rural Development sent them an e-mail last week asking them to make it a priority,” Roll said, “but we can’t really do anything else.”

The project to extend sewer service to about 103 residents between the water treatment plant and Cabinet View Golf Course has been in the works for three or four years now. The city council awarded the project contract to Edstrom Construction during its June 15 meeting on condition that the city acquires all of the funding.

Rural Development offered the bond and a $600,000 grant for the sewer extension initially when it was projected to cost $3.2 million. But when the lowest bidder pegged it at $1.7 million, Rural Development took back the grant. The city will, however, receive a total of $800,000 in grants from three other sources.

The city approved a sewer rate increase in May in order to be eligible to receive the bond, but Roll foresees revisiting rates if the project does indeed cost less than anticipated. 

Sewer base rates increased by $1.79 per month, and the usage fee – $1.34 per 1,000 gallons of water used – increased by 66 cents. Usage is based on water meter measurements during the months of October, November and December.

The sewer line will run right up to the Cabinet View Golf Course property, but future developers will have to pay $750,000 to get the golf course online. In addition, the golf course has about 150 lots that will eventually be developed and need to hook up to the city’s system. Each lot will cost the developer a Plant Improvement Fee of $1,800, along with regular hook-up fees.