March 6, 2019
City to receive $12 million grant/loan from USDA to build Fort Phantom Lake pipeline
The City of Clyde has been informed it will receive a grant and loan package totaling over $12 million to construct a pipeline from Lake Fort Phantom to Clyde’s water treatment plant.
Clyde City Administrator Mike Murray announced recently the United States Department of Agriculture will provide the grant/loan package to the City of Clyde. The USDA will provide grant funding for nearly half of the pipeline.
Murray said the total grant amount will be around $5 million, while the loan amount will be around $7 million for a total package of approximately $12 million.
He said the $7 million load will be a 40 year term with an interest rate of 3.125%.
In 2013, the City of Clyde sold bonds totaling $10.9 million to purchase water rights in Lake Fort Phantom. Previous droughts proved that Clyde Lake was not sufficient to meet the needs of the City of Clyde and residents of Callahan County. When Clyde Lake water isn’t available the City of Clyde has to purchase water from Abilene at rates that continue to rise.
Murray said currently, the City of Clyde makes an annual payment totaling $715,000 on those bonds for the Fort Phantom water rights. “Currently, we have $10.9 million borrowed at approximately 5% interest for water that sits in Lake Fort Phantom. The USDA will also refinance those bonds which have an interest rate of approximately 5% and 15 to 30 year terms.” The refinanced bonds will be at 3.125% for 40 years. The grant, new loan, and refinanced bonds will total nearly $22,000,000 but due to the lower interest rates and longer term, debt service will only increase by approximately $50,000 per year to actually deliver the water to Clyde. The current debt service is $715,000 and the new debt service will be $765,000.
The city administrator said the City’s engineer, Jacobs & Martin in Abilene, is still negotiating with property owners to purchase right-of-way to construct the pipeline from Lake Fort Phantom to the city’s water treatment plant. He said of the 22 total property owners from whom the city must purchase right-of-way, there remain about 9 owners still not committed.
Back in 2013, the City of Clyde purchased senior water rights to Lake Fort Phantom. Those water rights purchased include 11,834 Acre Feet with which the old WTU electrical plant operated and another 2,500 Acre Feet annually of water in perpetuity.
One acre foot of water is 325,821 gallons.
Murray said based upon the city’s current water usage, the 2,500 Acre Feet is three times what the city’s annual usage is thereby leaving excess water to attract industry and allow for future growth.
Murray said that when all the property owners’ right-of-way is obtained and the engineering to construct the pipeline is completed, the city will receive the $12 million USDA grant/loan package. Construction on the pipeline could begin as early as the beginning of next year if no delays are encountered.
Published in the Clyde Journal
Wednesday, July 22, 2015
Clyde City Administrator Keith Selman provided this project update on the City of Clyde’s purchase of Lake Fort Phantom Hill water rights:
Below is an abbreviated listing of activities associated with the purchase of the 2,400 acre feet of water from Lake Fort Phantom Hill and the piping of the raw water to Clyde’s water treatment plant.
- Earnest Money Contract: The City of Clyde entered into an earnest money contract with Eagle Construction in March of 2012 for the purchase of Certificate of Adjudication Number 12-4151 which allows for the impoundment of 6,500 acre feet of water and 2,400 acre feet of diversion from Lake Fort Phantom Hill.
- Application Submittal: Application for the conveyance was formally submitted to TCEQ (Texas Commission on Environmental Quality) in September of 2012.
- Water Purchase: TCEQ approved the conveyance in November of 2013 and the water was purchased in December of 2013; approximately 15 months after application submittal and 19 months from the present day.
- Water Pipeline: Pipeline efforts did not begin until water rights were secured.
- Pipeline Alignment Identified: Several viable alignments were considered. The three primary alignments were 1) cross country, 2) using establish roadway systems, and 3) an alignment to Elmdale and relocation the water treatment facility to that location. Costs associated with these were determined and Clyde City Council selected a cross country route to be the most cost effective and feasible. The pipeline will be approximately 21 miles from Fort Phantom Hill to Clyde and traverses three counties: Jones, Shackleford, and Callahan. (Task Completed)
- Property Owners Identified: This required research in three county courthouses. Properties had to be identified, property owners had to be identified, and contact information had to be obtained. Approximately 20 property owners were identified. (Task completed)
- Permission to access the property for survey purposes: Notices were sent to each of the twenty property overs requesting permission to enter the property for purposes of surveying the alignment. (Task completed)
- Survey of the Property: The 21 mile, cross country alignment survey is still in process. First, the corners of each property must be surveyed followed by a survey of the alignment with calculation of the amount of acreage required for the easement. (Task in Process)
- Easement Offer: Once actual acreage for the pipeline easement was determined for each property, an offer was made to the owners for the construction and maintenance of the raw water line from Lake Fort Phantom Hill to Clyde’s water treatment plant. The city has offered to purchase the easement. (Task in Process)
- Easement Acquisition: We have acquired three easements thus far. (Task in Process)
- Pipeline Design: Jacob and Martin Engineering have been the preliminary design of the pipeline. Final design will not be completed until all easements are secured. (Task in Process)
- Seek Funding Mechanism: The city is looking at three options for funding: a) Water Development Board, b) U.S. Department of Agriculture, c) The Bond Market. (Task in Process)
- Bid Requests: Once funding is secured and plans are finalized, the City will solicit bids for construction. (Task in Process)
- Pipeline Construction: Pipeline construction will include the platting of the property and acquiring building permits from the City of Abilene at take point for the pump station. (The platting process has been initiated.)