OGDEN -- The city council adopted a resolution Tuesday night to issue $4.5 million in bonds to fix a century-old water pipeline that supplies Ogden with much of its water.
The city wants a major upgrade and rehabilitation of a 24-inch steel water pipeline that runs from the city's water treatment plant at the top of Ogden Canyon to the 23rd Street reservoir.
Ogden City Engineer Justin Anderson said the pipeline is in poor condition and because it is a major water supply line to the city, the project can't wait any longer.
Anderson said the project will greatly reduce water loss and ensure continual service for years to come.
The environmental and conceptual design for the project is currently under way and the Sunsrise Engineering firm has been assisting Ogden with management of the project.
The Utah Division of Drinking Water had previously committed $4 million toward the project, but the additional money is needed to complete the entire project.
To come up with the additional funds, the city will issue nearly $5 million in bonds.
The state drinking water board has agreed to purchase the bonds for a term not to exceed 20 years and an interest rate not to exceed 3 percent.
The city will repay the bonds with water utility revenues.
The city will also establish a Capital Facilities Replacement Fund and deposit 5 percent of the water utility's annual operating budget, including debt service and depreciation, and will continue the annual deposits until the bonds are redeemed.
It's also expected that $13 million in bond funds will be requested in fiscal year 2014 to pay for the design and construction of a new water treatment plant.
In June, the city borrowed $1 million from the sewer fund and lent it to the water fund to allow the water utility to begin design work and other preparations so the plant can be constructed immediately after funds become available.