AUBURN — A $5.46 million water district bond issue took a step forward as city councilors gave their first reading consent Monday night.

The bond plan would refinance $2.16 million of water district debt, set aside $1.75 million for the second phase of a ultraviolet treatment facility, $1.05 million to replace water meters and $500,000 for a chemical chloramine facility.

Councilors voted 7-0 to recommend the bond package. They’ll vote on it a final time at the Sept. 7 meeting.

The water district has planned a public hearing on the bond package at its meeting at 4 p.m. Wednesday at the district office, 268 Court St.

District Superintendents John Storer said the Public Utilities Commission also needs to approve the bonds.

“We have our application there ready to go, but they won’t review it until we get all of the local officials to sign off.”

Storer told councilors that water rates are scheduled to rise 13 percent in January, taking the average bill from about $170 to $190 per year.

“But that’s not because of this borrowing,” Storer said. “As a district, we have not raised our rates for three years and it’s just time. We still have some of the lowest water rates in the state.”

The bulk of the borrowing package would help finish the UV treatment plant at Lake Auburn.  The district hopes to build an office, lab and storage building nearby. The cost of the $3.5 million building would be split with the city of Lewiston. Auburn’s share, $1.75 million, would come from the bonding package.

Another $1.05 million would pay for a water meter replacement program that began last spring.

Storer said the district hopes to build a chemical chloramine facility between the ultraviolet treatment plant and Central Maine Community College campus. The district plans to borrow $500,000 for that building. The Maine Municipal Bond Bank would rebate $125,000 of that, he said.

Another $2.16 million would refinance debt from 1994, 1998 and 2005.

“At the time, we got the best interest rate we could,” Storer said. “But interest rates now are so much lower that we can save significant money.”

According to Storer, the district will save between $600,000 and $740,000 with the lower interest rate.

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