Matt Lasley | GC News-Gazette An artist's rendering of what the new Leitchfield water treatment plant will look like.

Matt Lasley | GC News-Gazette

An artist's rendering of what the new Leitchfield water treatment plant will look like.

Leitchfield Utilities announced this week that it has been awarded additional funding to move forward with construction of a new city water treatment plant.

Leitchfield Utilities Attorney David Vickery said during Monday's Leitchfield City Council meeting that the agency requested additional funding for the project last November after the low bid from Smith Contractors Inc., of Lawrenceburg, Kentucky, came in at $11.4 million, which was more than $3 million above the original $8 million estimated cost.

Then, on Feb. 22, the agency received an offer of more funding from USDA in the amount of $5.5 million, which consists of a $4.5 million loan, which will be repaid over 40 years at a 3.375 percent interest rate, and a $961,000 grant.

In Sept. 2017, Leitchfield Utilities obtained $8 million in financing from USDA Rural Development for the project. That funding consisted of a $5.5 million loan, which will be repaid over 40 years at a 2.625 percent interest rate, and a $2.5 million grant.

The additional funds bring the total fund package to $13.5 million, but, Vickery said, the agency does not anticipate needing that much for the project, given the cost set by Smith Contractors.

Following Vickery's presentation, which, he said, is the best the city can do to provide water for the city of Leitchfield and eastern part of Grayson County, he requested that the council authorize the utilities to accept the additional financing and move forward with the project.

According to Vickery, the current water treatment plant, located at 3245 Lewis School Road, is 50 years old and antiquated. This has resulted in water quality issues because the plant cannot meet new regulations.

Leitchfield Utilities Superintendent Dwight Embry said that in order for the current plant to meet new regulations, around $5 million to $6 million would need to be spent to upgrade its filtration system among other things, and additional upgrades would be required in the years that followed these improvements.

Vickery added the current plant also struggles to meet the rising needs of its customers due to a limited output capacity. The new water plant, which officials estimate will take two years to construct, is expected to alleviate this issue as well.

The city council then voted to authorize Leitchfield Utilities to move forward with the project on a five-to-one vote, with City Councilman Clayton Miller voting against it.

Miller said he voted against the project because his constituents do not support the utility rate increases that will accompany the project.

One of the conditions for Leitchfield Utilities to receive financing from the USDA is that it increase its water rates periodically over time. The first rate increase, which raised the minimum bill for in-town customers from $16.40 to $17.76, was implemented in November, and more increases are expected in the coming years.

Leitchfield Utilities also implemented a 4 percent increase to the city's sewer rates in December as well, which increased the minimum sewer bill from $10.61 to $11.03.