Ashland City Hall Tidbits (Update)
City Hall Tidbits
4/15/24
By David Runkel
$75 million EPA Loan for Water Plant Construction
Supersedes Two Previous Funding Plans
Two previous plans to pay for construction of a new water treatment plant were set aside by Ashland city leaders in recent years in favor of the latest proposal to borrow up to $75 million at four percent interest from a federal government program.
This loan, plus $65 million in interest charges, would be paid off by utility ratepayers over the next 35 years through substantial increases in city water rates, already the highest in the Rogue Valley and among the highest municipal rates in the state.
Under the original financing plan, the city started raising water rates annually beginning in 2012 to build up a fund to pay a large part of the construction costs then estimated in the $30 million range. Mayor John Stromberg sold the annual increases as steps necessary to prevent a huge increase all at one time and to lower borrowing costs.
As a result of annual increases through 2019, the water fund currently has a balance of $18.6 million which Public Works Director Scott Fleury said will be tapped for other water projects, not the new plant.
Second, in 2016, the city received a $14.8 million, 1.79 percent interest rate loan from the Oregon Infrastructure Finance Authority for design and construction of a new plant. Six years later, City Council agreed to a Public Works Department request to reduce this loan to $4.7 million for design work only. This was a reimbursable loan and the city has been paid back.
Two years ago Fleury informed Council of an opportunity to apply for a construction loan from the federal Water Infrastructure Finance and Innovation Act administered by the Environmental Protection Agency that would cover the full cost of the new plant, now estimated to be between $55 million and $70 million.
To pay off the loan, a consultant proposed six additional 10 percent water rate increases this decade, which compounded would increase rates by 77 percent. Between now and 2028, the consultant found, the monthly bill for a single family residence using 1,000 cubic feet of water would rise from $61.71 to $109.29.
In March Council approved, 5-1, a resolution authorizing the city to accept debt of up to $75 million to facilitate the application for a loan from the US Environmental Protection Agency, but has taken no action on the water rate increase proposal. A petition drive is underway to put this loan proposal before city voters in November.
Over the past decade, the size of the new water facility has also changed. The original plan was to build a plant processing 2.5 million gallons of fresh water a day as a backup to the existing facility. This idea was dropped, however, in favor of an entirely new plant with a 7.5 million capacity. As a result of successful conservation programs and to cut construction costs, the water production capacity of the plant currently proposed is 7 million gallons of fresh water a day, with the possibility of increased production to 9 million. Capacity of the existing plant is 7.5 million gallons..
Editor’s Note: A previous version of this story said the Council’s resolution authorized the city to accept the EPA loan and that the capacity of the proposed new plan was 6.5 million gallons per day. We apologize for the error.
Homeless Weather Shelter Open 39 Nights
The cold weather homeless shelter in the garage of the former Coming Attractions office building at 2200 Ashland Street was open 39 nights last winter with as many as 28 persons staying each night.
Supervision of the shelter by Options for Housing, Resources and Assistance (OHRA) cost $25,575, according to figures in a report to City Council from Kelly Burns, the city Emergency Management Coordinator. He also said “special thanks” is due to Avram Sacks and “his dedicated team of volunteers who provided warm meals, coffee and helped obtain donations for comfort items including lamps, carpet remnants and carpet pads to make the stay more comfortable for overnight guests.”
The shelter was open on nights when the temperature was predicted to drop below 32 degrees. Medford’s center, with a 25 degree opening rule, was not activated this past winter.
The Ashland facility will be open this summer on hot nights and smokey nights if any occur. OHRA’s contract to operate the shelter, however, has expired.
This weather related shelter was run separately from the 24/7 homeless shelter in the same building. More than 70 people lived in this space for varying lengths of time during the five months it was in operation. Mayor Tonya Graham is seeking people to serve on an ad hoc committee to come up with a long term plan for use of the building purchased last September for $2 million, plus $250,000 in interest of a $600,000 note with the former owners. A state grant provided $1.4 million toward the purchase price, currently subject to a dispute between the city and state.
City Police Getting Pay Raise
An agreement has been reached between the city and the Ashland Police Association on a new contract replacing one that expired 10 months ago.
Under the terms, a 4.5 percent increase in pay retroactive to last July 1 goes into effect if approved by City Council Tuesday night. Four percent increases will be provided July 1 this year and another four percent next July 1.
Continued Renovations Former Briscoe School
Upgrades of the former Briscoe Elementary School on North Main Street which the city bought from the school district for $2 million in 2018 are continuing. The roof is being replaced at a cost of more than $560,000 and Council is being asked to approve a $180,990 contract with Vitas Construction of Gold Hill for installation of new floor coverings to replace existing asbestos floor tiles.
Next will be heating and air conditioning updates. The work is being paid for out of a $1.3 million grant from the state.
The Oregon Childhood Development Corporation operates a Head Start program in the building. Its lease was recently extended to June 30, 2025 with the possibility of a three-year extension.
