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Rezoning the GA White commercial is on City Council's agenda Tuesday night.

City of Huntsville Receives Prop 3 Bond Money

by Walker County News Today staff

The City of Huntsville has, over the past weeks, begun to implement the three major ballot propositions approved by the voters in November 2016. That 2016 vote authorized the City to assume up to $128 Million in long-term debt to improve public safety facilities (Proposition 1), city service facilities (Proposition 2) and water and wastewater facilities (Proposition 3).

The largest of these initiatives, Proposition 3, authorized up to $73 million in new debt for water and wastewater facilities. That proposition is also the first to be implemented in terms of the City actually issuing new debt.

At its May 1, 2018 regular meeting  Huntsville City Council passed an Ordinance authorizing the sale of “Series 2018 Water and Wastewater System Revenue Bonds.” This is a $52.83 Million series of tax-free municipal bonds to be paid back with interest (3.5362% per annum) over 25 years from revenues that the City collects from its water and wastewater customers.

The yearly amount that the City will pay back to the bond holders is estimated to be approximately $2.86 Million for a total payback cost of approximately $71.5 Million.

At their most recent meeting on June 19, 2018, Council was advised by City Finance Director Steve Ritter that the 2018 Series sale had successfully closed and that the expected amount of bond money has been received by the City. This allowed Council to formally approve a budget amendment for several utility upgrade projects as follows:

A.J. Brown Wastewater Treatment Plant $20,875,247.00
Elkins Lake Dam Lift Station 3,626,800
New 2.5 MGD Elevated Storage Tank 4,144,000
7,500 GPM Palm Street Water Plant Replacement 2,914,000
4,800 GPM LPP Plant with 2MG Ground Storage Tank 4,912,000
Spring Lake Water Plant replacement pumps 120,000
New Water Lines 10,182,953
Total:   $46,775,000

Though not discussed in this meeting, according to the May 1 Ordinance the remaining $6 Million will be held in reserve or used to pay for the costs of issuing the bonds.

Planning for these projects has been well underway in anticipation of receiving the bond money. Brent Sherrod, Interim Public Works Director, advised Council that these projects have now been placed under contract and that onsite work would start within the next week. He told the Council that the elevated storage tank construction would begin first and be completed in January 2020. That tank will be located behind Fire Station Number 1 on Veterans Memorial Boulevard near the Spring Lake subdivision.

According to Sherrod, the A. J. Brown Wastewater Treatment Plant, located just off of State Highway 19 northeast of the Huntsville city limits, is set to begin renovations on July 5 with a projected completion date of January 2020. He noted all water projects are to be done at the same time since they work in conjunction with each other.

“Plans for the two pump stations and ground storage tanks are almost final and set to bid at the end of June,” Sherrod said. “Those projects should be finished in February 2020, along with the water lines.”

Sherrod also explained that the wastewater improvements at the Elkins Lake Dam Lift Station are independent of the other systems and would be going out for bid shortly, with expected completion in September 2019.

Mayor Andy Brauninger asked about the budget for the elevated storage tank and A. J. Brown projects already in the works. Sherrod said that the bids had come in well under the estimates and that vendors had responded actively, with more interest in upcoming plans, leading to better pricing for the City.

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