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Posted: October 4, 2012 9:21 p.m.

County tables $21M loan for Bear Creek

The Newton County Board of Commissioners at their meeting Tuesday tabled a resolution that would enter into an agreement with the Georgia Environmental Facilities Authority for $21 million in financing for the planned Bear Creek Reservoir.

Before the board voted on the resolution, county Chairman Kathy Morgan asked Jenny Carter with the county attorney's office what would happen if the board decided to approve the resolution.

"If we approve this resolution it just says that we intend to enter into this agreement, but it doesn't actually obligate us to enter into the agreement, is that right?" Morgan asked.

"It does not at this time," Carter said. "This does not have to be adopted tonight. So if the board members have questions or would like any more information, the board can go ahead and table this. It's fine."

Carter said the board could also schedule a work session if they wanted to discuss the resolution more. Commissioner Mort Ewing made a motion to table making a decision on whether or not to adopt the resolution until their Oct. 16 meeting.

According to the resolution, the Newton County Board of Commissioners is in the process of obtaining a Section 404 Permit under the Clean Water Act for the construction and operation of the Bear Creek Water Supply Reservoir.

The Georgia Environmental Facilities Authority approved providing the county with a low interest loan of $21 million for a period of 40 years for the construction of the Bear Creek Reservoir.

GEFA requires the county to commit to meeting projected operating revenues and paying off debt associated with the Bear Creek Reservoir.
The resolution states that the county will prepare an updated rate analysis to determine the required operating revenues to meet the terms of GEFA's loan.

County Attorney Tommy Craig said previously that the loan represented a de facto vote of confidence.

The loan was awarded by the Governor's Water Supply Program, which gave out a total of $90.49 million to eight projects across the state; 15 applications totaling $195.59 million were received. The actual money comes from the Georgia Environmental Finance Authority and Georgia Department of Community Affairs.

Newton's loan calls for 0 percent interest for the first three years of construction and 1 percent interest for any construction time after that, which doesn't have to be paid at the time but can be added to the loan amount. Then for the remainder of the 40 years, the interest rate will be 1.82 percent, with the first seven years consisting of interest-only payments and the remaining years of principal and interest payments. There are also no loan closing fees.

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