Buchanan City Commission talks downtown infrastructure project – Leader Publications

BUCHANAN — Monday, Buchanan City Commissioners heard updates about the upcoming downtown infrastructure project and the results of water and sewer rate studies. They also brainstormed about what will happen if the Buchanan Rite Aid store closes.

The $18.2 million downtown infrastructure project is getting closer to starting after years of preparation with bids already received, city officials said. The city is getting a 40-year $16.2 million low interest loan from the U.S.D.A. Rural Development to pay for most of the project with the rest coming from the general and water and sewer funds.

The project will pay for improvements to the aging water and sewer systems to replace pipes installed a century ago as well as streetscape work on Front, Main and Oak Streets, Red Bud Trail and Days Avenue.

In connection with the downtown project, Roger Swets of the city’s bond counsel, Dickinson Wright, introduced an ordinance the commission will vote on later this month. He said the ordinance details the bonds the city will have to issue for the U.S.D.A. low interest loan.

He noted that the interest rate the city is getting for the loan, 1.375 percent, is much lower than other loans the city could get which are in the four to five percent range over a shorter time period. “You will have a lot lower debt service than you would have gotten in the bond market,” he said.

City Manager Tim Lynch said the city commission will also be voting to accept bids for some of the streetscape work in July. He said some work will be done this fall with more done starting next spring. The entire project should be done in 2027.

Swets and Jeffrey Rowe of the Baker Tilly financial advisor group also talked about the water and sewer rates the city needs to have in order to pay back the U.S.D.A. loan.

Rowe presented the results of water and sewer rate studies recently completed. He said his firm is recommending eight percent annual rate increases for both water and sewer to pay for $9 million worth of water work and $7.5 million worth of sewer work. They are recommending the water rate increases stay in place for five years and the sewer rate increases for four years.

He said the focus of their studies was to come up with rates that will cover operating and maintenance, replacement and future capital needs costs. He anticipates that the average residential bill will go up by $4 a month for water and $6.50 a month for sewer.

“Our infrastructure is 100 years old,” City Commissioner Dan Vigansky said. “People complain about their bills but we haven’t done anything about the infrastructure for years. There are forces out there screaming bloody murder but we had to do the new sewer treatment plan and the DPW building.”

Vigansky noted-and Rowe agreed-that other communities are raising their rates much higher. Rowe said his firm recommends small regular rate increases so rates don’t have to be increased so much so quickly. He also pointed out that rates might have been lower in the past for the city when there were more large volume industrial users.

Lynch also reported on two ongoing infrastructure projects, the Days Avenue culvert work and the Front Street retaining wall. He said the culvert work is going to take a little longer to get through the state permit process but that design work is continuing. He said soil borings will be done next week.

Soil borings have already been done for the retaining wall and he said he hopes to get design drawings by the end of this week. Those two projects are separate from the downtown infrastructure streetscape project.

In other business, the commission approved a contract with the Ramsay Group to administer the $300,000 community development block grant the city is receiving. The city will use the money for select demolition and home improvement work in the North Side Neighborhood.

Community Development Director Rich Murphy said Sanya Vitale will be the city’s contact person with the Ramsay Group and noted she has many years of experience in grant administration including several years working for the city of Niles.

As for the Rite Aid situation, a local resident told commissioners that she had sent a message to Walgreens asking them to come to Buchanan if Rite Aid closes. Vigansky said that he had already contacted people he knew in the Walgreen company and was told they would not come to Buchanan.

Vigansky said Rite Aid is closing all their Michigan, Minnesota and Ohio stores and added that the Buchanan store will close in August and the Niles store in July.

Mayor Sean Denison said that the Live Buchanan group had been discussing the possible Rite Aid closure and realtors in that group are working with an independent pharmacist to open a small store front business in the downtown.