Grosse Pointe City could issue bonds in spring for water, sewer improvements

By: K. Michelle Moran | Grosse Pointe Times | Published November 21, 2022

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GROSSE POINTE CITY — Grosse Pointe City officials are gearing up for what they say will be needed upcoming underground infrastructure work.

“We’ve been assessing our infrastructure needs for over a year now,” City Manager Peter Dame said during an Oct. 17 Grosse Pointe City Council meeting.

Although Dame said that investigation “is still ongoing,” they know they’re going to need money to pay for anticipated repairs and improvements to water and sewer lines. As a result, the council voted unanimously Oct. 17 in favor of a notice of intent to issue bonds.

“This is not going to increase your property taxes,” said Dame.

The bonds, which would be tax-exempt because they’re for a public purpose, would be paid off over time using water and sewer funds or capital improvement funds, Dame said.

The City last issued bonds like this in 2016. Dame said those were for water main improvements.

Dame said the City is seeking funding assistance, pointing out that they’ve already applied for Federal Emergency Management Agency grants for flood mitigation; he said they hope to know in early 2023 whether they will be receiving any of those. The City has also applied for state grants to replace lead water lines, and Dame said they’ll be applying, as well, for low-interest-revolving loan funds from the Michigan Department of Environment, Great Lakes and Energy. These loans — being made possible through federal and state infrastructure funds — could be applied toward lead line replacement, sewer lines and water mains.

There’s a chance an EGLE loan, if approved, could be forgiven.

Mayor Sheila Tomkowiak said EGLE is changing its standards for needs and how it determines the affluence of a community.

“That may help us qualify for (funding),” Tomkowiak said.

She said that the city has a number of smaller homes in areas that need the most work.

Dame said the City won’t know if it has received any money from EGLE until late 2023. Because of the urgency of getting started on these projects — City leaders don’t want to see another catastrophic flood like the ones that hit homes and businesses in the summer of 2021 — Dame said they will probably need to issue bonds next spring to cover the cost of projects that will be undertaken in 2023. Those bonds — which could be up to $3 million — would fund lead service line and water main replacement under roads being replaced, to avoid tearing up roadways or paying for new paving materials twice. In addition, Dame said they plan on making stormwater improvements in The Village next year to reduce the likelihood of flooding.

Even if the City fails to get any state or federal dollars, Dame said they “still need to fix” their infrastructure.

Dame said the notice of intent doesn’t require the issuance of bonds in the future, should officials decide not to do that.

If the City does decide to issue a bond next spring, Dame said the council would vote on a resolution to that effect. By that time, he said, they would also know the exact amount of the bond.