By Benjamin Bullard
The Cullman Times
HANCEVILLE —
Work can now begin on a massive overhaul of the waste water treatment plant in Hanceville, an underpowered facility that has given the city’s water & sewer board problems almost from the time it was built more than 20 years ago.
In a specially-called meeting of the water & sewer board Friday, the panel approved a revenue-secured bond to fund $5.43 million in water and sewer projects, the biggest chunk of which—about $4 million—will be spent to completely refurbish the sewer plant on the city’s south end.
All board members present voted in favor of the measure. Board member Kim Brown did not attend the meeting.
The 30-year bond issue is structured to pay mostly interest over the first 15 years of its repayment schedule. In 2026, the board would begin gradually paying more on the principle of the debt than it does interest. While rates have not been set (the bond will not go to market for another 50 days), the total payout is projected at around $15.5 million.
The bond will be issued through Merchant Capital LLC of Montgomery.
After considering whether to include the City of Hanceville as co-signer on the bond note, the water board decided to go it alone. The city’s partnership would have meant an approximate $15,000 per year in savings, but would have potentially encumbered the city—a separate incorporated entity from the water & sewer board—and compromised its ability to borrow money for municipal projects over the next three decades.
A recent sewer rate increase will have to be followed by another before the bond can be offered to potential holders. Preliminary figures indicate an increase of 12.86 percent will have to be passed as soon as possible to guarantee to bondholders that the board has in place a mechanism to generate sufficient revenue.
An outstanding $400,000 loan to Merchants Bank was rolled into the package, as was the balance on a 1989 note held by the board. In addition to the plant upgrade, the bond will also allot $500,000 for the pursuit of additional water sources in the city, as well as just over $500,000 to pay for the first of three phases of long-term upgrades to pipe infrastructure throughout the city.
For officials, the move comes not a moment too soon—and may be overdue. The city received word last week that it had been placed under a long-threatened moratorium by the Alabama Department of Environmental Management (ADEM) restricting new sewer tie-ons throughout town.
According to water & sewer department superintendent Chris Freeman, the moratorium cannot be lifted until the upgraded treatment plant comes online. While the ADEM mandate does effectively kill new construction from happening during that time, it does create some provisions for extenuating projects—most notably at Wallace State Community College.
Wallace State will be able to work on new projects so long as its overall contribution to the city’s sewer burden does not increase by more than 5 percent over existing levels. The college must also allow the water board to conduct a comprehensive study in an effort to locate whether any points of storm water infiltration into the city’s sewer system are originating from on-campus sources. Finally, the college must eradicate any storm water infiltration into its own sewage conveyance system, since that sewage ultimately ends up being treated at the Hanceville plant.
Only projects that hold existing building permits are exempt under the pending moratorium. The two that qualify are a CVS pharmacy and a small curb market.
When finished, the treatment plant will occupy only slightly larger a footprint than it currently does, but will see the installation of new equipment across the board that will bump its capacity to treat sewage from a current daily average of 570,000 gallons to about 1.5 million gallons.
Goodwyn Mills & Cawood, Inc., parent company of plant operating firm ClearWater Solutions, will assist the city in readying construction documents and coordinating project work.
“This is a building block that we can move forward on,” said board member Doug Batemon after the meeting. “I hope this is something that will enhance our community for years to come.”
* Benjamin Bullard can be reached by e-mail at bbullard@cullmantimes.com or by telephone at 734-2131 ext. 270.
