By Derek Spellman
dspellman@joplinglobe.com
NEOSHO, Mo. — Neosho voters on Tuesday will decide the fate of a proposed $9.5 million bond issue that city officials say is needed to upgrade an aging water system.
If approved, the measure would enable the city to obtain loans through Missouri’s revolving fund at low interest rates, thanks to federal stimulus money. The city would then issue revenue bonds, with revenue from city water bills to pay off the debt over the next 20 years.
The proposed projects involve the water plant, the replacement of deteriorating water mains, and updates to several water pumps and wells. The work should also help reduce water leakage and sediment infiltration, two problems that have plagued older areas of town for years.
“Much of the equipment is 68 years old,” City Manager Jan Blase said.
About a third of the upgrade cost would be for work the city must do to comply with pending state and federal environmental mandates.
Economics
If the city secures a 2 percent interest rate, the work would cost $581,000 a year between principal and interest over the 20 years, according to estimates from Archer Engineering.
Assuming that cost is divided equally over each of the city’s water connections, a monthly increase of $9.46 on water bills would be required. City officials have acknowledged that number could change depending on the ultimate rate structure that is adopted and whether that structure allocates more of the cost to commercial or residential users.
The monthly bill for the average Neosho household is now about $13.97, assuming usage of 4,000 gallons a month.
City officials note the national economy is still wobbly, although they said that the recession and the federal stimulus package have led to lower interest rates and heightened competition within the construction industry, which in turn translates into savings.
But Mayor Jeff Werneke said the city would be mindful of the economy if the issue passes. The project, and its attendant rate increases, would be phased in over time.
“We realize the economy is not great right now,” Werneke said.
Previous issue
If approved, Tuesday’s measure would be the second multimillion dollar bond proposal passed by Neosho voters in one year.
Voters last August approved an $8.5 million sewer-bond issue to replace aging infrastructure, increase the size of collection pipes through downtown, and pinpoint areas where groundwater is infiltrating the sewer system. The city is to participate in the revolving loan fund program for that work too.
The city has issued a request for bond proposals for most of that sewer work, which will be undertaken as one project.
The average sewer bill for a Neosho household is to increase from about $12.86 a month to just less than $24 a month. That increase is beginning to take effect now, Blase said.
And the sewer increase is causing at least some residents to balk at Tuesday’s proposal.
Bill Millender, for example, said his sewer bill has increased and he still hasn’t seen any sewer work to justify it. He also said neither the federal government nor the state government had any right to tell Neosho how to build its infrastructure.
Neosho resident Jim Hughes said he was not necessarily opposed to the water issue if there was a demonstrated need. The problem, he contended, is that the city has not circulated a lot of information about the bond measure to underscore that need.
“They’re really not making much of a campaign down here,” he said.
Werneke said the city was the host for a meeting about the proposal Tuesday, and that he sent out an informational letter and has done radio interviews about the plan. He also said much of the water issues in the city have been known for years.
He also said the city is being cautious not to come off as “threatening” when it says the work, especially those projects required by state and federal regulations, need to be done.
“You can’t really hammer people over the head on this stuff, or it’s like you’re overselling,” he said.
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