Water, sewer rotary loan program may be re-established

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A bill pending in the state legislature that would re-establish the Water and Sewer Rotary Loan program has found an ardent supporter in Mark Stahl, an Ottawa County commissioner.
House Bill 635 has been referred to the State and Local Government Committee. If passed into law it would provide no-interest loans to counties, municipalities, and water and sewer districts established under section 6119 of the Ohio Revised Code for agricultural property owners to defer special assessments covering water and sewer extension projects.
Under Rep. D.J. Swearingen’s bill, the program would allow those projects to be funded through a no-interest loan from the state, which would cover the deferred agriculture assessment with no up-front cost to the farmland owner.
The program was ended about 10 years ago.
“Usually when we have to run water and sewer in a rural county to get from point A to point B, we have to go through agricultural frontage. What this program did was to recognize the importance of the agricultural community and provide a no-interest loan that would be paid at a later date,” Stahl said. “It was a great program; it was successful. We’ve talked for many years about needing to bring it back. Especially with all the financial incentives we have for water and sewer projects.”
The County Commissioners Association of Ohio and County Sanitary Engineers Association of Ohio are supporting the bill.
“We’re working on it for this region but there are many rural counties that would benefit from the program,” Stahl said.
The bill also would re-establish the water and sewer commission as a seven-member board that would include directors from four state agencies and three persons appointed by the governor.
The commission would be under the Ohio Water Development Authority for administrative purposes and be tasked with approving specific extension projects.
Jerry Greiner, president of the Northwest Water and Sewer District, said he supports the bill but market conditions could weigh heavily on how well the program fares.
“We’ve seen subdivisions explode in the Oregon and Northwood areas in the last 30 years but look at how it’s slowed in the last 10 or 15. There just isn’t the kind of development coming forward that you’re going to have developers paying premium prices for acreage. In the old days you had 30 or 40 homes per plat. Now it’s maybe 10 lots in a plat,” he said. “The demand has slowed so much that this agricultural land isn’t turning over.
“I think HB 635 is a good idea. Our way around it in the meantime until the rotary fund is replenished; we’ve chosen to not do some projects or do projects with a little different assessment formula to minimize the impact on agricultural property that’s affected. We’re funding them ourselves.
HB 635 doesn’t fit all situations but where you have growth in rural areas it works very well. And if you are confident mortgage rates won’t go up, the economy won’t slow down and your project will succeed it’s a great way to fund it.”
Stahl said he didn’t expect the bill to have any committee hearings until the legislature returns from its summer break.
According to figures compiled by the Ottawa County Sanitary Engineer’s Department, from 1991 until 2008 water and sewer projects undertaken by the department received about $1.5 million in loans through the Ohio Water and Sewer Rotary Commission.
The projects ranged from a sewer project in Allen and Clay townships in the western part of the county to Put-in-Bay and Camp Perry to the east.
If it passes, HB 635 would also benefit projects pending in the department’s 5-year capital improvement plan, said Ryan Barth, deputy administrator of the department.
In all, 19 of 41 projects in the plan would benefit from rotary loan funds, he said.