April 8, 2003

 

Low-interest loans for PI project nixed in Romney budget plan. Organizers say not time to worry.

By CHRISTOPHER BOLICK

Staff writer

NEWBURYPORT -- If Gov. Mitt Romney's budget plan passes as he's presented it, Plum Island residents may have to dig a bit deeper into their pockets down the line to pay back loans for a $22.9 million water and sewer project.

George Gustafson, the Plum Island Project Coordinator, delivered this potentially unwelcome news yesterday morning at a meeting of the Plum Island Work Group at City Hall.

When asked what impact the loss of a subsidized loan would have on the water and sewer project, Gustafson said it would cause "a significant increase" to the betterment fees residents will have to pay over the next 20 to 30 years to fund the work. The loans cover about 90 percent of the total cost, he said.

But Gustafson was quick not to sound the alarm. "I don't want to make too big a deal out of it" because the governor's level-funded budget "is only proposed, and he will probably change it," he said.

In the same meeting, project organizers also agreed to hire a public relations firm to improve communications on the project, settled up on more than $79,000 in unpaid bills, and laid the foundation for a new training and education program about island zoning and environmental regulations.

But the biggest development at the meeting was Gustafson's announcement about the uncertain funding status of a state program that awards subsidized loans to cities and towns for water pollution abatement projects.

During his project update to the work group, Gustafson said there is "no money" for additional projects in the Massachusetts Clean Water State Revolving Fund Program (SRF) in the governor's proposed budget for the next fiscal year.

If Romney's proposal is approved as is, he said, Newburyport and Newbury would be out of the running for a promised low-interest loan from the fund. Without the state loan, interest rates would be approximately 4 percent, Gustafson said, as compared to a zero or 2 percent rate through the state program.

"The best analogy is that it's like when the U.S. government passes a bill, but money still has to be appropriated for that bill," Gustafson said of the potential loss of the loan through budget cuts after the meeting. "If we're promised money, but it's not funded, that promise is not a good promise."

Gustafson told the work group that he "had a scare" over the proposed 2004 fiscal year budget for the Revolving Fund program at first, but these fears were largely allayed after he called Steve McCurdy, head of the program at the Department of Environmental Protection.

"Everybody's on pins and needles with budget cuts at the state level, but Steve is not overly concerned," Gustafson told project organizers. "He's concerned, but he's not worried at this time. The word we're getting is, 'don't worry about this now.'"

Gretchen Friede, the Newburyport Water Commission representative on the Plum Island Work Group, said she thought the revolving fund program operated like a trust fund "so once it's granted, the money is locked in."

Gustafson said that because the water and sewer project hasn't been bonded yet it would be considered an "additional" project by the fund program, and Romney's budget proposal gives no money for additional projects next fiscal year, which begins July 1.

Gustafson said letters are being sent to the Water Pollution Abatement Trust, which administers the loans in cooperation with the DEP and Division of Municipal Services, to address loan holdups.

He said project organizers have also contacted local state representatives and state senators and requested money be kept in the state budget for the revolving fund program. "A lot of people are working on the issue and a lot of proposals are being floated around to address it," Gustafson said.

Education and outreach

Project organizers hired a New Hampshire-based public relations consultant, Laurie Storey-Manseau, to provide a "consistent flow" of information to the community as developments are made in the water and sewer project.

Storey-Manseau, who attended yesterday's meeting, will be paid with $10,000 in unused funds left over from the design phase budget, Gustafson said. Friede, who said a consultant "should have been hired two years ago, in my opinion", said the contract should be capped at $10,000 to avoid cost overruns.

Storey-Manseau said she will help with newspaper articles and guest editorials, set up a phone line and web site for people with questions about the project, arrange neighborhood information sessions and draw up a "fact sheet" on the fundamental project particulars.

The PI Work Group also gave Gustafson the go-ahead to organize a Plum Island Overlay District (PIOD) education and training program as required by a Environmental Impact Report (EIR), which will train the building inspector/commissioner, zoning board of appeals and conservation commissions in each community.

The PIOD by-law restricts building and development on Plum Island.

The mayor of Newburyport and the Chairman of the Newbury Board of Selectmen will nominate three people to serve on the committee by the next meeting of the PI Work Group, which will be at 7:30 a.m. at City Hall April 28.

 
 
(This article replicated online with permission of the Newburyport Daily News, an Eagle Tribune Newspaper.)
 
 
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