by David Anderson
Kinston Free Press
The members of the Kinston City Council decided not to take any action this week to go after state funds to upgrade the city’s water infrastructure, because the loans could add $1 million to an already extensive municipal debt.
“It would be a long-term (commitment), and we don’t know about our water rates,” Councilman Bobby Merritt said.
Water Resources Manager Steve Miller submitted requests for approval to apply for a $500,000 loan to replace aging and leaky water mains in three neighborhoods, and a $1.5 million loan to replace water meters that must be read manually with meters that can be read electronically.
The money would come through the N.C. Drinking Water State Revolving Fund. The city would only have to pay back half of each loan, at 2.445 percent interest over 20 years. The city would also have to pay $40,000 in processing fees.
Council members and the mayor wanted more information on the loans, though, and the council and Interim Finance Director Catherine Gwynn worried the city was taking on too much debt for too long a period.
“It has the potential to add a million dollars to the debt,” Councilman and Mayor pro tem Will Barker said.
During the meeting, Mayor B.J. Murphy called for votes on both loan proposals. Council members made motions, but no one seconded, and no action was taken.
The deadline to apply for the loans is Sept. 30, and Murphy said the subject could come back up in a special meeting before then, as city officials gather more information.
“We just didn’t have enough time to dissect a 20-year decision and how that could impact our budget,” the mayor said. “We just had too many questions and not enough time.”
David Anderson can be reached at 252-559-1077 or email@example.com.