Jefferson water customers who noticed an increase in sewer rates starting July 1 “ain’t seen nothin’ yet.” The Jefferson city council at its regular meeting Aug. 9 approved the first reading of an ordinance increasing sewer rates by 11 percent effective July 1, 2023, another 11 percent effective July 1, 2024, another 9 percent effective July 1, 2025, and 9 percent effective July 1, 2026. That’s on top of the 5.5 percent that went into effect last month.

The increases are to pay for a required upgrade to the wastewater treatment facility.

Tim Oswald of Piper Sandler, the city’s financial advisor on the project, attended the council meeting. He led the council through three tasks relating to the project, the third of which was to approve the first reading of the rate increase ordinance.

The first step was to set a public hearing on the issuance of an amount not to exceed $15 million in bonds from the state revolving loan fund (SRF). That hearing was set for the Aug. 23 regular meeting. The exact amount of the bond will be determined after bids are received on the project.

The state revolving loan fund is the least expensive place to fund the project, according to Oswald, with an interest rate of 1.75 percent plus an additional 0.25 percent administrative fee. The term of the bond would be 20 years.

The council had previously increased sewer rates in anticipation of the project, and now has a balance of $1.5 million in the sewer fund. However, a cash-on-hand balance doesn’t factor in to the calculations of revenue and expense in selling bonds.

Oswald recommended the council use $565,000 from the sewer fund to pay off sewer bonds issued in 2012. With those bonds paid off, the city would be paying only on the SRF. He also recommended putting $500,000 from the sewer fund into the project, decreasing the amount of bonds sold. The council also approved that action.

Construction is scheduled to begin in December and be completed by June, 2024.

In other business, the council approved an application from Nikki Uebel, doing business as Corner View Properties LLC, for a $137,500 grant for façade improvements at 100-102 N. Wilson Ave, now Re/Max Legacy.

The council accepted a $600,000 grant from the Iowa Economic Development Authority for housing at 203 W. Harrison St (former middle school). The city is now a subapplicant on the grant. A development agreement will be entered into with Nate Adams, developer of the project.

During the reports portion of the meeting, council member Harry Ahrenholtz reported from a Greene County Development Corporation board meeting held earlier in the day that “a slight hitch” has arisen on the project. Adams has applied for and needs a $2 million historic tax credit to get the project off the ground.

Adams was previously told the building wouldn’t qualify for the tax credit with the 1950s gymnasium attached. The Greene County Schools board approved $150,000 to raze the gym, but work was delayed because both parts of the building use the same heating system.

It now appears the project won’t get the tax credit if the gym is removed. It must remain attached to the building for at least five years after the project is completed. “Hopefully he can work through that, because that tax credit is a big part of the project,” Ahrenholtz said.

Demolishing the gymnasium would be needed to implement the Three Block Project proposed as part of the Vision 2020 plan. That project includes the middle school renovated into apartments, the new Greene County Early Learning Center (very close to completion), the demolition of the former south grade school once the Early Learning Center moves to its new building, and a centerpiece park.

The council approved bad debt write-offs from 2008-2009 utility bills totaling $16,901.22.  The council also approved a new plat of survey for Landus Cooperative shows the fertilizer tank as part of the larger parcel that handles grain and agronomy and the SoyChlor building on the north end of the parcel as part of the feed division.

The council agreed to hold a workshop to set priorities for FY 2023-24 on Sept. 27 as part of the regular council meeting.

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