MEXICO — Selectmen took action Tuesday night following a public hearing to apply for a Community Development Block Grant, together with other funding, that could result in new water and sewer lines and road reconstruction for three town streets.

Town Manager John Madigan said the town is applying for $500,000 for new water and sewer lines for Alder Street, South Main Street and Osgood Avenue. An additional $100,000 each would come from the Mexico Water District and Mexico Sewer District.

Also, about $700,000 would come from a resident-approved bond to be used to reconstruct all or portions of the three streets.

The entire project is expected to cost about $1.4 million, and if the CDBG grant is approved, work would begin in the spring, Madigan said.

The town should know within the next few weeks whether the $500,000 grant has been approved.

Also at Tuesday’s meeting, Madigan said a team from the state’s Department of Labor has inspected or will soon inspect several municipal buildings including the Fire Station, library, Public Works Department, Police Department and Recreation Center. The inspection was requested by the town so that infractions will be identified. Information received will be used during the development of the 2011-12 municipal budget.

In other matters, Selectman Byron Ouellette was authorized to learn from Oxford County Sheriff Wayne Gallant whether his office can provide police coverage for the town and what it would  cost.

Madigan said that information will also be used in the town’s budget development process.

The board also appointed retired banker Donald Cummings to fill out the remaining 18 months of a three-year term of longtime Water District Trustee David McDonald.

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