Plymouth Council Adopts Water & Sewer Lateral Revolving Loan Fund Pilot Program

Water & Sewer Lateral Revolving Loan Fund (RLF) Program
On August 27, 2019 the Plymouth Common Council adopted resolution 23 of 2019 creating the water lateral and sewer lateral revolving loan fund pilot program. The initiative sets aside approximately $500,000 in funds to provide 100% financing of private lead water laterals and private sewer lateral replacements through a low-interest revolving loan fund program. Eligible property owners would repay the low-interest loan through a special charge on the property tax bill.

The program is being called a pilot program because earlier this year the Common Council passed a resolution stating its intent to extend the life of tax incremental finance district (TID) no. 4 one additional year in 2027. The TID extension would provide funding to create an affordable housing revolving loan fund program. This long-term housing program would provide funds for home repairs including replacement of lead water laterals. In the interim, the short-term loan program approved in 2019 will provide the financing necessary to support voluntary lead water lateral replacements as well as funding to those water laterals that are leaking and/or sewer laterals that are in need of replacement.

Eligible applicants include residential properties limited to 4 units or less and/or a licensed day care facility. Project eligible for funding include lead water laterals, water service with lead goose necks, a failed or leaking water service, non-code compliant sewer laterals, or a deficient sewer lateral.

If you are interested in the RLF program, please contact the City Clerk-Treasurer’s Office at Plymouth City Hall.

What are the RLF program priorities?
First priority will be given to those proposed projects that are located within officially approved capital improvement project areas (water/sewer/street projects). This includes a higher emphasis for projects that eliminate a lead water service. Second priority will be given to those proposed projects that meet an immediate emergency situation where privately-owned water or sewer laterals have failed. Third priority is to provide funding for those that voluntarily replace their privately-owned water laterals outside of a city capital improvement project. Overall funding decisions will be based on the amount of funds available and funding priorities.

Who is eligible for a loan?
Eligible applicants include: Residential properties limited to 4 units or less and/or a Licensed Day Care Facility.

What types of projects are eligible?
-Water Laterals: Lead water services, services with lead goose necks, or a failed water service as approved by the Director of Public Works/City Engineer.
-Sewer Laterals: Sewer laterals that are non-code compliant (clay) or that have a deficiency or failed as approved by the Director of Public Works/City Engineer.

Please note that landscaping costs or tree removal are not eligible for funding. However, RLF loan funds will be made available for road repairs in the case of a sewer lateral that requires the road to be excavated and repaired.

What is the application process?
An application will be available through the City Clerk/Treasurer’s office at Plymouth City Hall. Applicants will be required to provide an application form and receive approval prior to work being done by a plumber. A cost estimate is required to be submitted as part of the application process. The city will pay the plumber for work completed based on a request from the property owner along with documentation that the works meets all building code requirements.

Special instructions will be provided to property owners that are seeking to replace laterals during a city approved capital improvement project (water/sewer/street project). Information will be shared as part of the public informational meeting for the project.

What is the interest rate and how are payments made?
Based on household income levels, the interest rate will be between 1% to 2.5%. The amortization or repayment schedule will be based on a 10-year period. An annual payment will be due as part of the annual property tax bill and will be a special charge on the tax bill. Pre-payment of the entire loan balance will be an option for borrowers.

What is the source of funding for this initiative and will my tax bill or utility bill increase if I do not participate in this program?
In 2019, the State of Wisconsin and HUD defederalized the City of Plymouth’s Community Development Block Grant (CDBG) business revolving loan fund program. Funding for the short-term initiative is coming from the defederalized CDBG grant funds that previously supported the business revolving loan fund program. As a result, neither the property tax levy nor utility rates will increase as a result of this program.