FAIRMONT - Funding for Fairmont's new water plant was secured Monday, with the City Council agreeing to purchase a $28.9 million general obligation water revenue note.
The 30-year loan comes through the state's Public Facilities Authority at an interest rate of 2.234 percent.
Included in the loan agreement, the city was forgiven $4 million in principal and $1 million in "green" dollars for taking steps to make the new plant more energy efficient and reduce its environmental impact.
The $5 million knocked off the cost of the project "will help with future rate increases," said Paul Hoye, Fairmont's finance director.
In August, the council set a water rate increase of 10 percent for 2012 and the same for 2013, action required by the Public Facilities Authority for the city to secure the loan.
The rate hikes to pay for the plant began in 2008. According to city staff, the average residential customer will pay about $13 more per month after the final rate hike in 2013.
Actual work on the Albion Avenue site began late this summer, with the demolition of Budd School, and completion of the new plant is scheduled for July 2013.
The existing water plant will remain in place until the following year, when it will be removed and replaced with a green space for public use.