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The authority heard some price estimates for a new treatment plant.
Wednesday, September 18, 2013
BEDFORD — After fielding some questions concerning the affordability of building a new water treatment plant at Smith Mountain Lake to pipe water to Bedford and Forest, the Bedford Regional Water Authority took a hard look at numerous financing options Tuesday.
The authority, which in July consolidated county water and sewer operations with those of the former city of Bedford after it reverted to a town, is in the preliminary stages of the estimated $34 million project.
The new plant would increase the withdrawal from the lake at more than twice the current level. It would carry water from Moneta to the town of Bedford along Virginia 122 and then on to Forest along U.S. 460, calling for a 26-mile line. A backup water supply is required as part of the city-county reversion agreement.
The project is expected to be complete by the end of 2016.
The goal, after millions are spent on capital costs, is to save millions more over the next half-century by no longer purchasing water from Lynchburg to serve the Forest area. Brian Key, authority director, has said water can be generated at a much lower rate than Lynchburg charges.
But some residents have voiced skepticism of the long-term savings and claim the project is an unwise and wasteful move. The loudest critic, a group called Bedford Above Board, has referred to the plan as a “pipe dream” that threatens to financially strain the county.
Sean Ekiert, of Raymond James, the financial consultant on the project, presented the authority board of directors with financial scenarios at a work session Tuesday. The options ranged from a price tag of $38 million to $34 million with about $4 million in added debt to each scenario.
The scenarios factored in a 25-year loan with a 4.5 percent interest rate assumption or a 30-year loan with 5 percent. Another possibility would cost $16 million and would not include the plant. However, it would eliminate the savings potential since water still would be purchased from Lynchburg.
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