A $10 million bond issue approved by the Kearns Improvement District board of trustees Wednesday will help fund sewer improvements and the construction of a large water storage tank in the foothills.
The sewer and water revenue bond issue appears to be the largest in the history of the Kearns special service district, said trustee Royce Gibson.District officials expect to close on the bond transaction April 21.
There are three components of the bond issue:
- Some $6.6 million is earmarked for sewers. That includes $2.67 million to refund a series of old revenue bonds currently collecting a higher rate of interest and nearly $4 million in new money.
That new money will cover half of an $8 million project to replace old sewer lines in about a third of the district. The rest of the project will be funded through a $2 per month increase in sewer fees levied in early 1997.
- $3.3 million will be used to help fund a new 8 million-gallon drinking water reservoir that will be built in the foothills west of Kearns. Water will be pumped to the new storage tank at night when electrical rates are least expensive and supplement the district's system during the day.
- The remaining $100,000 will be used to cover the cost of issuing the revenue bonds.
Gibson said the district will benefit from "an excellent interest rate" on the bond that will net out as slightly less than 5 percent over the life of the issue.