RutlandHerald.com - We Are Vermont

Mayors fume at priorities

Small private projects ahead of municipal works

Alan Shelvey, engineer for the City of Rutland, shows a cast iron drinking-water pipe cut out of a line on Woodstock Avenue. The pipe was installed in 1858 and is covered in rust. The rust does not seep into the drinking water because of a chemical the city uses to coat it, according to Shelvey. The pipe still runs along Woodstock Avenue and the city would like to replace it, he said. In the background, City Clerk Henry Heck takes a look at the pipe. Vyto Starinskas / Rutland Herald

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MONTPELIER – State and local officials are trying to figure out which communities will – and should – benefit from millions in federal stimulus money for drinking water and sewer projects in Vermont.

But, like all such programs in which demand is greater than funding, some towns will win and get federal money while others won't and will have to either spend more in local property tax revenue to build wastewater and potable water systems, or put the work off.

The stimulus project money for drinking water and sewer projects will provide for low-interest loans, and municipalities will have to pay roughly half the money back to the fund.

There will be about $20 million in drinking water stimulus funding in Vermont, about $2 million of which goes to assistance for towns and administration. The remainder will go to projects – but the state has already received nearly 150 requests for projects totaling roughly $120 million.

Some aspects of the draft list of drinking-water projects that will get funded in the first round of stimulus spending worry Rutland Mayor Christopher Louras.

Projects that are closer to being ready to go – with local bonding in place and permitting complete, for instance – get higher priority. And that means some private drinking water systems – at private schools or condominium developments in some ski resort towns for instance – will get public money before projects by some cities and towns.

Projects at Mendon Mountain Apartments and Catamount Bolton, for instance, are both among the top 20 on the state's priority list. Rutland City's first water project, meanwhile, is at number 82 and unlikely – at this point – to get funding in the first round of water projects at least.

"At the risk of opening a new front in class warfare, I would contend that it is neither in the state's interest nor within the spirit of the legislation to provide loan forgiveness for nonresident/second homeowners at private resort condominiums when true public infrastructure is in critical need of public funding," Louras wrote in comments to the state's Department of Environmental Conservation.

Louras also notes that the Drinking Water State Revolving Loan Fund is the sole source of funding for municipalities with populations greater than 10,000, while smaller communities have the option of utilizing U.S. Department of Agriculture's rural development funding.

The state revolving fund that helps pay for cities and towns to build drinking water systems has always provided help for private community water systems, said Eric Blatt, of the Department of Environmental Conservation's Water Supply Division.

The argument has been that since those community water systems – in a trailer park or housing developments – serve similar populations as municipal or fire district systems they should also be eligible for state help, Blatt said.

And the agency is still accepting public comments, re-evaluating its list and verifying that the information provided by towns – for instance on whether their permits are complete – is accurate, Blatt said. Therefore the final list of projects may be quite different from the current version. And even the first half of the project list is final sometime in June, some projects might lose their ranking or be passed over if they fall behind.

"When the stimulus funds came in some of us thought our target population was going to be larger municipal projects that never ranked high (normally)," said Brian Redmond, who also works on the state revolving fund that helps fund with drinking water projects. "The way it sugared off is the top 20 projects are smaller projects with significant public health risks that ended up ranking very high."

Barre Mayor Thomas Lauzon, whose city has a water project ranked at 127 on the state's list, said he has many of the same worries in general about stimulus funding.

"I share some of the same concerns," he said. "All of a sudden projects no one heard of a year ago are getting priority because they are 'shovel-ready'," he said.

But both mayors caution that the proof will be in what is finally funded and built with the money – and that it may be quite different than it now appears.

"It will be interesting to see how that all works out," Lauzon said. "It is a little bit premature for anybody to judge. The scope of these projects is just so huge. In fairness to everyone, to the mayors, the select boards and to the state departments, you have to give the dust a little time to settle."

But "the other concern I have is what is this going to do to the price of construction" he added.

Meanwhile there are similar questions about the other state's other major revolving fund, this one dedicated to help the building of wastewater projects.

The federal government is expected to provide about $20 million in stimulus funding for those projects as well. And while private systems have not traditionally been able to get that money – and won't this year either – some municipalities would like to be higher in the rankings than they are under the new schedule provided by the state.

Brattleboro's $33 million sewer plant construction project – ranked 76 on a list of which the state expects to fund the first 15 projects in the first round of spending – could easily have been higher up the list if the only thing that mattered were the priority points awarded by the state for projects that need to be done because of high usage or bad condition, said Brattleboro Town Manager Barbara Sondag said. However, since the town included a date of January 2010 in its construction contracts it had to make way on the list for cities and towns with fewer priority points but which were deemed to be closer to ready to use the money, she said.

Montpelier, with combined sewer overflow projects expected to cost roughly a half-million dollars, is at the top of the wastewater project list.