USDA rep tells White Hall Council water/sewer loan debt requirements

Published 4:27 pm Monday, September 14, 2015

By Fred Guarino
The Lowndes Signal
The White Hall Town Council heard from USDA Area Director Nivory Gordon Thursday night, Sept. 10, that USDA requires the establishment of a debt service account for the town’s 1997 water project loan and its current Sewer Treatment Project grant and loan.
The council also learned that it must charge sufficient rates to cover the debts.
Gordon reminded the council that White Hall has a 1997 loan with USDA in the amount of $317,900 at 4.5 percent interest for the town’s water system. He said the town must put enough money aside for debt service in a debt service reserve account.
He said, however, that in review of the town’s audit, “that is not the case.” He said, “I’m here tonight to say to loud and clear we will bring this into compliance.”
He said it is at the point in time the council needs to establish that account and not remove any funds without agency approval, “otherwise you are in non-compliance.”
Gordon also said the town must charge a water rate sufficient to meet their debt service requirements. He said rate studies have been put on the table for the council to study.
Gordon went on to tell the council that with the existing loan in place for the town’s sewer and wastewater treatment facility, “those same requirements will be placed upon you.”
He said the large grant the town is getting for the sewer and wastewater treatment facility will help soften the impact.
Gordon also pointed out that the town will also be required to employ a wastewater treatment operator to help operate the sewer system once it is installed.
He said the council has 18 months on that sewage project to get these things established.
Gordon said, “The purpose for me being here tonight is to work with communities and help you.”
Gordon also made it clear to the council that water and sewer revenues cannot be used for any other purpose than the water and sewer systems.
Gordon said he extracted his data from the town’s previous audits in 2013 and 2014. He also read to the council from a current audit, which Mayor James Walker stated the town has not received at this point because it is incomplete.
Gordon further pointed out, “There is no free water to anyone on the system regardless of who you are or where you are. And if you owe anything to the system…you need to pay. There is no forgiveness on water.”
In discussion of the $1,024,000 grant and $112,000 loan funded project from USDA for a sewer and wastewater treatment facility in White Hall, Gordon told the council that regardless of a groundbreaking display drawing, the specs and plans approved by USDA for the U.S. 80 portion include three businesses and 57 residential customers.
He stressed that the town needs to have the 57 residential customers and the three commercial establishments signed up for sewer before the project can go forward.
Walker stated he wants a meeting between the council and the engineer on the sewage project.
Related to the water system, Patricia Young of the White Hall Water Board and Generation Nextest Inc. told the council that Mosses charges residential customers $24.50 per month for 3,000 gallons while White Hall charges $18 for 3,000 gallons. She said the Water Board had wanted to see a water rate hike in White Hall at the beginning of the fiscal year.
Walker said the council will address water rates and will sit down with the water committee.
He said, “We do need some sort of revenue increase.” He said, “We can’t sustain what we’re doing with an aging system breaking down that’s constantly leaking, constantly tearing the road open and going back to repair the road.”
Walker said the town is going to “need to do whatever we need to do.”
In other matters:
Walker asked council members to look at the committee list sheets and tasks.
He commended the volunteer fire department for its response to a struck pedestrian in the Black Belt Community. Walker said he received a letter of appreciation and wanted to commend Fire Chief Antonio Stringer and volunteer Sherita White for their response.
Walker said the town still needs more fire department volunteers.
He asked the council to look at business license fees from Hayneville, which he said he would like to follow and which he said needed to go into effect at the first of October.
Walker said the town will need a new representative on the board of equalization who is not a council member.
And said anyone wanting to be on the council’s agenda should notify the clerk by the 25th of each month.
Young, who also represents Generation Nextest Inc., a non-profit organization, presented a check for $500 to Walker to say thank you to the town for the use of town hall and it electricity for a summer feeding and enrichment program .
In making the presentation, Young said the program “was a great success” and that it served hot breakfast including, grits, eggs, pancakes, waffles and sausages to the children.
She said the program served 1,310 breakfasts to children over a six-week period and served 6,058 lunches.

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