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Thirty-Five Year Utility Financing Option

By Christina De Witt, CPA, Principal, October 12, 2017

Umbaugh completed the first financing through the Indiana State Revolving Fund’s (SRF) new program that allows for up to a 35-year repayment period for pipe components of utility improvement projects. The Town of Michigantown was the first to finance the pipe components of their sewer project with the new SRF program.  The repayment of the pipe components of their project, which totaled $274,000 of the overall $1,156,000 project, allowed the community to save each sewer customer over $4.50 on their monthly bill.

As long as the useful life of the overall project improvements are equal to or exceed 35 years, the pipe component repayment period can be extended from the typical 20 years to a maximum of 35 years. The extended repayment period lessens the rate impact to customers and better matches the useful life of the assets. The extended repayment period does increase the interest rate 30 basis points (.30%) over the conventional 20-year repayment period.

This program can be beneficial to communities that are in need of upgrading and replacing pipe infrastructure. As you are working through the planning process of your utilities’ upcoming improvement projects, this new SRF program is one more option to consider.

To discuss more details of the program’s applicability to finance your communities’ upcoming utility improvement projects, please contact us at .(JavaScript must be enabled to view this email address).

Information in this article was believed current as of the date of publication. As you know, changes occur frequently. The information presented is of a general educational nature. Before applying to your specific circumstances, please contact us at vision@umbaugh.com.


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