Local towns clamoring for federal stimulus loans to ease flooding

Posted7/2/2010 12:01 AM

Wet basements that had no chance of drying before because of the high cost of local flood reduction projects may soon see days without mold. Communities, small units of government and even homeowners' associations are clamoring for a piece of nearly $17 million in federal stimulus loans pegged for water infrastructure improvements.

Kane County will oversee the funds and the projects, but must first decide which projects it will choose for the funding. Interest in the loans generated a list of 48 projects from 33 different entities. Not all of them will make the cut. The 48 projects have a combined price tag of $25 million. The projects involve everything from water main replacements to storm sewer repairs and are all relatively small in scale. In fact, the costs of the projects are in a limbo range that makes funding hard to come by, yet too great for smaller communities or homeowners' associations to fund on their own. They are also the type of projects large communities forego during tight budget times.


"A lot of these projects involve old neighborhoods that were developed before we had zoning standards to make sure they were resistant against storm events and flooding," County Board Chairman Karen McConnaughay said. "It's never been the county's obligation to fund those projects (with property tax dollars), however, we have typically used riverboat funds for them. We do a couple of them a year."

The federal stimulus loan program will allow the county to knock out dozens of the projects in one swoop for the first time. The trick is that the money must be paid back. That means any group applying for the money must show an ability to pay it back over time, usually a period of 10 years. County water experts said the typical way of doing that is to set up a special service area that automatically charges a tax only on the residents benefiting directly from the project, such as the homeowners' association members. The tax expires once the money is paid back.

"It is not free money," McConnaughay emphasized.

Whittling the list will involve ranking the projects based on the greatest benefit for the largest number of people and job creation. County board member Drew Frasz said he's looking forward to the loans erasing a lot of stress for local homeowners in flood-prone areas that had no help in sight until now.

"There are residents who cannot leave town, can't go on vacation, because if they hear thunder they are down looking in their basements, putting their furniture on blocks," Frasz said. "It's going to very positively impact many people's lives when we pull this off."