Downtown Greeley should get relief from some of its flooding problems after the city council voted unanimously on Tuesday to approve up to $17.5 million in 20-year stormwater bonds for fund improvements along an important drainage corridor.
The bonds are for “costs associated with the construction of various upgrades and additions to the stormwater system to…increase the system’s ability to safely discharge stormwater and floodwater” and to replace infrastructure aging stormwater, according to city documents. The bonds carry an annual debt service of $900,000 to $1.6 million, and they will market in mid-March and close on April 5.
The bonds represent the second stage of a roughly $81 million, 10-year project to replace the 12th Street outfall, which staff said Tuesday has been planned to improve for years. The project will provide a new, more efficient way for stormwater to move from downtown to the Cache La Poudre River, according to the city.
“Some low- and moderate-income homes” would benefit the most from these improvements, Ward III Councilman Johnny Olson said Tuesday. “If we have a major flood in this area, we are going to lose some of our most vulnerable people in the city. It’s important to say that. So I appreciate those efforts.
The first stage of the project, which was funded by stormwater fee revenue, was to design Phase 1 and cost just over $1 million. Bonds approved on Tuesday will fund the construction of Phase 1.
Phase 1A of the project aims to relocate utility lines along 10th Street near US 85. The $350,000 design for this $4.1 million phase is still underway, but work Construction is expected to begin within the next two months and last until the end of next year.
Phase 1B, which city staff said on Tuesday may be the largest and most expensive component of the entire $81 million project, is the installation of the new storm outfall at off US 85, which runs from 12th Street north to the Poudre River. It cost the city $700,000 to design, and construction is expected to cost around $12 million. Work is expected to begin on the outlet once the utility relocation is complete, and is also expected to continue until the end of next year.
The bonds will fund the design of Phases 2 and 3 of the project, which city staff expect to begin designing early next year. Phase 2 runs along 12th Street from US 85 west to the rail lines near 6th Avenue. Its design is expected to cost around $1 million. Phase 3 is primarily for work near the railroad tracks and is expected to cost around $400,000 to design.
The full project, which consists of seven phases, will not be completed until at least 2032. Another bond issue of approximately $21 million is planned for 2025. These bonds are intended to finance the construction of phases 2 and 3, as well as the design and construction of phase 4. Revenues from stormwater charges are expected to cover the remaining three phases.
To pay off the bonds, the city raised stormwater rates, and there are several rate increases on the horizon. An 8% rate increase that began this year has brought stormwater rates in Greeley to around $12 per month for a single-family home. This still leaves Greeley just behind some of its nearest neighbors in terms of stormwater rates; Loveland and Fort Collins have single family home rates around $15, and Boulder is around $21.
Greeley plans to raise its stormwater rates by 15% later this year to around $14 per month for a single-family home, though that rate won’t hit bills until 2023. After that, the city aims to increase rates of 18% for 2024, an additional 18% for 2025, 10% for 2026 and 8% for each year from 2027-29. The steady increases, according to city staff, have to do with Greeley catching up with the surrounding communities in terms of stormwater rates, which staff say have historically lagged other Colorado cities.
The bonds make up the last tens of millions of dollars of bond issues by Greeley this year related to water, stormwater and sewer infrastructure, but the city’s chief financial officer, John Karner, said that Greeley was in good financial shape and his debt was far from unmanageable. He noted that the city can easily pay more than 1.5 times its annual debt, which he said is a typical goal for municipalities. In fact, Greeley should be able to pay more than 3.5 times its debt service this year and about 4.5 times its debt service next year, according to city documents.
Karner also said Greeley has strong credit ratings from Moody’s (Aa2) and S&P (AA+). The S&P rating has been reaffirmed over the past two months. He noted that recent bonds all benefit from repayment coming in part from new water, stormwater and sewer customers during constructions, which he says is one of the fairest ways for cities. finance infrastructure improvements.
— Trenton Sperry is the government and political reporter for the NoCo Optimist. Do you have any advice? Let The Optimist know at TheNoCoOptimist@gmail.com. Find more NoCo Optimist content at www.thenocooptimist.com.