Yuba to borrow for levee work
County says it will take on debt of $33 million
Yuba County will take on a loan of $33 million to fund the six miles of the Feather River setback levee, the final phase of levee repairs.
"Providing public safety is the outcome we are all looking for," County Administrator Robert Bendorf told supervisors Tuesday night.
The loan will supply the local match from the county for construction of the setback levee, which will enhance flood protection in Plumas Lake and Arboga.
In August, the county was notified it would receive $138 million from the state through Proposition 1E if the county could provide the remaining $53 million for the $191.8 million project.
County officials anticipate $30 million to come from developer impact fees, leaving the remaining money to be borrowed by the county.
County staff presented two borrowing scenarios to supervisors. After nearly three hours, supervisors approved the second scenario of $33 million, which includes six years of interest.
"The price of land is dropping, and it will continue to drop," said Supervisor Dan Logue. "I want to give our staff some time to catch their breath before they have to start paying this back."
Bendorf said because repayment of the loan is largely based on developer impact fees, he is more confident borrowing additional money to provide more time to allow the market to bounce back.
By borrowing $33 million with six years of interest, the county will not need to begin repaying the loan until 2014. Payments are on an escalating scale beginning at $1.3 million and growing to $5.3 million over the next 40 years.
Bendorf noted the funding agreement is not valid until all parties involved, including the county, developers and the state, have signed it.
County officials expect construction to begin in April.
Regardless of the funding choice, supervisors agreed, the project needs to move forward.
"Little ole Yuba County is moving fast and furious to protect its citizens," Supervisor Hal Stocker said. "We are widening a channel and cutting down the possibility of floods. I think we need to progress to provide safety to a number of people."
Contact Appeal-Democrat reporter Andrea Koskey at 749-4709 or akoskey@appealdemocrat.com
