RD Demands Updated Schedule from "New" Board

SEELEY LAKE - The Seeley Lake Sewer District received an ultimatum June 21 from Rural Development (RD): Update the district’s construction schedule within 30 days or RD will “very pointedly assign a schedule.” The meeting was the first regular meeting where three newly elected directors were seated.

The district received a letter from RD outlining a couple of concerns including change to the overall budget and scheduling of the proposed sewer and collection system. RD Area Specialist Dan Johnson was in attendance to help answer questions regarding the letter and any other questions on RD’s funding offer laid out in the Letter of Conditions the district accepted last fall.

Director Beth Hutchinson asked Johnson to explain condition of requiring the district to obtain user agreements ahead of bidding the project.

Johnson said 148 signed sewer user agreements from landowners in Phase 1 are required because there is no point in building the system if not enough people are going to use it. Johnson added that the benefit of signing up users is that the cost of the hookup is paid for from within the project. The district is not behind schedule in collecting these but they must be done before going to bid.

In the sewer user agreement section the Letter of Conditions also said that users will be required to make cash contributions but Johnson said that is not true with this project. The Letter of Conditions is based on a template with generic language and because the district has included the hookup costs in the overall project, that section does not apply. Hookups remain free to the landowners that sign the user agreements.

As to the district’s schedule, Johnson said the project is about six months behind the schedule that was provided to RD by the district. He said the project was held up because it took longer than anticipated to get the Notice and Protest process going and results processed last fall. The District has only three years from the date on the Letter of Conditions to commence construction. The clock started ticking Sept. 11, 2017.

Johnson said that RD is being pressured to cut the deadline down even further because if people are not going to use the funding it needs to be made available for other projects.

Johnson asked if it was the new board director’s intention to stay engaged, learn about and continue the process of moving forward. He didn’t ask for a vote, he just wanted the board members thoughts.

Hutchinson said the intent of the new board members has never been to just cut the project off because there has been a great deal invested in it. They are going to simultaneously be checking on alternatives and moving forward with the project as planned. They will look at other options for some portions of the district as well.

Hutchinson felt that they were elected because the voters didn’t have enough information. She said she plans to gather that information so that people can feel more comfortable making the decision about the sewer.

Director Juli Cole said she is definitely interested in learning more and moving forward. She felt that information is power and people need more information.

Director Troy Spence said he wasn’t against the sewer but wanted to see if there were options that might have been overlooked and could be more affordable for Seeley.

Director Davy Good said he has been for the sewer and is excited for the opportunity they have been given. He thinks once the new members are brought up to speed, the project will move forward. He added that he knows the system is expensive but that there is time for the board to solve the financial issues before any bills actually go out.

Hutchinson added that one of her main concerns is that the solution for low-income families must be found before committing to the project. She wants “many birds” in the hand to make a firm commitment.

Johnson warned the board that if there were changes to the project that the district would lose the RD funding package and would have to start all over. Alternative projects will not be financed with the current funding package.

Another issue is that RD now has a limit of $5 million for grants and the Seeley Lake project currently has $6.7 million in RD grants. If the district starts over and has to reapply for the grants, it will be limited to $5 million.

The other issue raised in RD’s letter to the district was any changes to the budget needed to be reported and RD concurrence must be requested. There has been an increase in professional services and a decrease in a Water Resource and Development Act grant. The letter stated that it is not unusual to have changes but that the district needs to make the request.

Johnson said the District shouldn’t take any of this as a threat but felt the board needed to know the information as they considered the options moving forward. Hutchison thanked Johnson for providing the board with the insight.