Perryville selling $1.45 in bonds to help with sewer plant upgrade

Debra Laubach, finance director for Perryville, explained to the mayor and commissioners why the sale of bonds would be needed as the town pursues a $6.3 million upgrade of its sewer plant.

PERRYVILLE — Town officials approved an ordinance Tuesday that will send Perryville to the bond market selling $1.45 million in bonds to aid in funding an upgrade to its wastewater system.

“The sewer plant is currently in compliance with denitrification,” said Debra Laubach, director of finance.

Commissioner Robert Taylor pointed out that the denitrification system, which removes nitrates from the wastewater before it gets discharged into the Susquehanna River, is monitored closely by the Maryland Department of the Environment.

“If we go above (the threshold) we get fined. If we go below we get money from the Bay Restoration Fund,” Taylor said. Earlier this month, Taylor told the board that Perryville got its $60,000 BRF award plus another $12,000 in additional COVID-related money.

Taylor explained that as the town continues to grow, staying under that tolerance will become an issue without these upgrades.

The Bay Restoration Fund, referred to as ‘the flush tax’ by some, is supported by the tax collected quarterly on every household and structure in Maryland that is connected to a public or private wastewater system.

Laubach said that bond money would be used to pay the bills to upgrade the plant, but much of that cost would be reimbursed by grants waiting in the wings.

“MDE gave us a $1 million grant to design the plant which is 99% complete with money left,” Laubach told the mayor and commissioners. “The remaining portion of that million will go toward construction.”

Jay Apperson, MDE spokesman, said grant amounts do change with a project’s estimated costs.

“We are currently reviewing the cost estimates and if all the proposed items are related to Enhanced Nutrient Removal, we will fund the project at 100%,” Apperson said Thursday.

Perryville initially received a $7.8 million grant from MDE to pay for the denitrification project. That amount dipped to $6.2 million. Laubach said the bond sale proceeds would cover costs not covered by grant funding.

“If we had to borrow the entire $1.4 million we would pay $88,000 over 20 years,” she said.

The town has received other funding for the project including a May 2018 grant for $20,000 for planning and in April 2020 another $330,493 came in for design.

“For construction, there was an initial $1 million in the fiscal year 2020 budget and there is an additional $5,721,796 in the fiscal year 2022 budget,” Apperson said.

Taylor called the project ‘an excellent investment for the town.’

“Especially since the state is paying $6.3 million,” Taylor said.

To which Laubach added, “And we do need it.”

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