KIMBALL -- The City Council discussed applying for a loan of over $5 million to finance the Wastewater Treatment Facility improvement project. 

The city is seeking a 40-year loan of $5,863,000 with USDA Rural Development. 

For the city to afford the loan costs, Chair of the City Board of Public Works Jim Cederburg says utility rates would increase in small increments over the next three years. 

“We are looking at increasing rates this year by $2.25, next year $2.50, and 2027 $2.25,” Cederburg said. 

After having looked at alternatives like pumping through a neighboring town like Scottsbluff or Sidney, which came back as an estimate of $20 million, Cederburg said this is realistically the most practical solution. 

“It’s going to cost more next year if we don’t do it this year,” he said. “We’re really trying to do the best for the City of Kimball.” 

Certain areas of the plant are in need of a major upgrade to run properly and support the growth of the town, said Doug Louden with Olsson engineering, who oversees the construction project. 

Louden is recommending that the city address the issues in one project rather than replacing and repairing pieces at a time. 

Louden posed three main concerns to tackle with the project: 

  • Parts of the plant need repairs/maintenance or replacement due to not having had a major rehab in roughly 25 years 
  • There is an issue of capacity based on the intended growth that Kimball will see in the next couple of decades 
  • The advancement of technology has outgrown some of the old parts of the plant, which will cause issues down the road if they are not updated  

The last major rehab of the plant in 2002 brought the capacity up to 7,500 people; however, a change in state regulations derated it to support a population of 5,000 – with the most recent consensus recording a population of 2,559 residents. 

According to the engineering report, “All improvements should be designed for flows that are two times higher than what the plant currently experiences and loadings commensurate with this residential population growth.” 

Louden says the intent is to bring the capacity back up to 7,500 due to the projected population doubling over the next decade or so. 

Community member Gabriel Miller voiced his concern, saying that he does not foresee Kimball’s population increasing to that number to justify bringing the capacity back up to 7,500 and suggests scaling it back to remain at a capacity of 5,000. 

When Louden was questioned about the lifespan of certain parts and systems of the plant, it varied from some pieces giving way in the next five years while other pieces may have another 20 years of life left but most parts needing repairs will need to happen within the next 10 years. 

He added that unfortunately, most pieces of the plant do not have a lifespan of 40 years to last the length of the loan the city is needing, which is what Council Member Austin Garner posed as a concern. 

“We’re on a 23-year cycle of major rehab, and if we have a 40-year loan, then we will have two loans of a large amount going at the same time,” Garner said. 

Miller also expressed his concerns, saying: “To get a 40-year loan – that’s two generations that’s going to be paying that loan back. Utilities are high now, and now we’re talking about raising them again.” 

Mayor John Morrison points out that the city does not need to take the full 40 years to pay off the loan. 

This project has been in the works for almost four years, during which time Louden and city officials have been seeking grants, but there has been no luck finding other funding than this loan through USDA Rural Development. 

Community member Julia Gehrig suggested that the city wait until the new federal administration is in office to see what other funding and grants will become available. 

“Exactly what are we doing to keep the costs down because the citizens are struggling,” she said. 

The alternative option is to have a line item in the budget to make repairs as needed; however, Louden said it’s a more complicated process fixing the plant piece by piece.

“If you’re going year-to-year, it’s really hard to plan ahead for growth and changes,” Louden said. “Costs are going up, so it gives you the ability – at one time – to get ahead of population growth if that happens, and you get one contractor in who is responsible for everything. It is a lot simpler of a process.”

Council Member Creg Pike said due to inflation, the costs are going to keep going up, so he doesn’t see why this should be stretched out to fix it pieces at a time.

“We’re going to end up paying more if we hold off,” he said. 

The City Council will make a final decision regarding the loan in the Jan. 21 meeting. Should they approve moving forward with the application of the loan, they will also award the contractor to work on the project. 

In a special meeting on Jan. 20, The Board of Public Works will choose and recommend the best bid. 

“That will tell us the actual price of what the construction will be,” said City Administrator Annette Brower. “The estimated price we are talking about right now is what the engineer has estimated, so the hope is it could be cheaper.”