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05/16/2017 12:00 AMAfter years of studies, discussions, and resident complaints, the possible water main extension project to Mulberry Point, Tuttles Point, and Long Cove took a big step forward this month. The town recently announced that, of the 145 homes in the area that could be served by the water main, 83 percent of residents signed formal commitment letters to connect with the main, well exceeding the necessary commitment level and pushing the project forward.
At the Board of Selectmen (BOS) meeting on May 8, the board and town officials discussed the project history and the next steps to get the project to town meeting and eventually referendum.
Water contamination has been a longstanding issue for some residents in the coastal area. A January 2016 study of water samples collected in the area revealed approximately 74 percent of the 29 wells tested are contaminated with salt water substances and pollutants from septic systems including nitrates, bacteria, sodium, and chloride according to Health Director Dennis Johnson.
The water main extension is expected to stretch over 2.4 miles and cost approximately $3.4 million, servicing 145 homes in Mulberry Point, Tuttles Point, and Long Cove. In January, the town signed a service agreement with the Connecticut Water Company (CWC) that outlined the financial rate of contribution from CWC.
The rate of contribution from CWC is dependent upon the percentage of the 145 homeowners in the area who commit to the project. If 40 to 60 percent of homeowners commit, CWC contributes $1 million. If 60 to 80 percent of homeowners commit, CWC contributes $1.4 million to the project. If more than 80 percent of homeowners commit, CWC contributes $1.5 million. With an 83 percent commitment rate demonstrated by residents who sent the water company signed commitment letters and financial deposits, CWC will contribute $1.5 million. First Selectman Joe Mazza said he is pleased with the level of commitment.
“The response was fantastic…We are very encouraged,” he said.
After CWC’s contribution, the remaining cost of the project, $1.9 million, will not be distributed town-wide, but will be distributed among homeowners who are direct beneficiaries of the water main extension. The town has applied for Drinking Water Revolving Funds, a low-interest loan from the State of Connecticut that in 2012 became available for the project, contingent upon a successful referendum. With the 83 percent contribution rate, Attorney Norb Church said resident will likely be assessed for approximately $13,161, which can be paid back over 20 years at a two percent interest rate.
At the BOS meeting, board members asked about the certainty of the total project cost and how all of the soft costs, such as preliminary studies and legal fees, will be covered. Johnson said all soft costs to date are included in the total project cost and will be paid by the 145 homeowners unless the project is defeated at referendum, in which case the town will have to cover the soft costs.
“There is quite a bit of contingency in the cost,” he said. “If the cost goes over budget or under budget, the residents that would bear the assessment cost would be given the extra cost…That price may go up or down once we have the final construction plan, but the estimates were reviewed by our engineer and the water company and they felt they were fair estimates for this kind of terrain.”
Beyond securing commitment and financing for the project, the town recently obtained all seven easements needed for the water main route. Church said all easements are currently being held in escrow.
“Over the last year and half or so, we have been securing easements to run the water line ultimately to service lower road and then Mulberry Point and Tuttles point,” he said. “A number of easements were required either from private property owners or the associations.”
With the BOS satisfied by the project plan, the board voted to approve a resolution to move the project to town meeting and move the project on to the Board of Finance (BOF) for consideration on May 15. At the BOF May 15 meeting, officials continued discussions over financial details of the project.
Mazza said residents will pay for the project in the form of a special assessment. However, as the project exceeds $1 million, the project must go to a town-wide referendum.
“We have to go to a town referendum because we are actually indebting the entire town even though the 145 property owners will pay the amount of this project,” he said.
BOF Chair Matt Hoey said financing for the project is not bonding in the traditional sense, but more of an appropriation.
“The term ‘bonding’ is an art form,” he said. “We are authorizing bond appropriations in the amount of $3.4 million. On day one, if it is approved, we will not be going to the market bonding that amount of money. We will be going to the market at various times to bond what we need…The methodology is we get voter approval for the whole amount—similar to what we do with the Board of Education building program—so we will not be going to the street for the total amount of the authorization that is going to be approved by the voters.”
At the BOF meeting, presidents of the Mulberry Point and Tuttles Point associations spoke to emphasize that only the residents in the service area will cover the cost of the project. Resident Don Knapp spoke about the need for clean drinking water in the area. He said he is getting tired of buying drinking water.
“You cart 32 empty gallons into your car and you go find a place to fill it and that is easy,” he said. “It is carting the 32 gallons back into the house that changes your mind. Please, we are willing to pay and I am too old to keep hauling water.”
The BOF approved the resolution for an appropriation for project borrowing costs unanimously with one member recusing himself due to a conflict of interest. The proposed water main extension project moves to town meeting on Wednesday, May 24 at 7:30 p.m. in the Community Center. The referendum date is set for Wednesday, May 31 from 7 a.m. to 8 p.m. at the town’s five polling places.