OXFORD — The town has been approved for a $13.7 million loan to pay for a wastewater treatment plant near the Welchville village dam, Town Manager Michael Chammings told selectmen Thursday night.

Selectmen signed the 20-year loan agreement with the Maine Municipal Bond Bank, which facilitates the federal and/or state money from the Clean Water State Revolving Fund Program. The loan will pay for the first phase of a state-of-the-art treatment facility that uses no chemicals.

The town has applied for rural development grants that could offset part of the cost of the plant. If that happens, the town won’t have to take out the full loan, Chammings said. If the town doesn’t get the grants, the loan will be transferred to a permanent loan of about $19 million to pay the full cost of the project.

Chammings has said a sewage system will encourage businesses to move to the Route 26 corridor.

At their meeting Thursday, the board also agreed to leave open the possibility of hydroelectric power on the dam because the treatment facility will require a lot of energy.

The town is awaiting approval from the Maine Department of Environmental Protection to begin work on the treatment plant.

Also Thursday, selectmen approved a liquor license for Polly’s Pit Stop and a liquor license for a fundraiser at Boxberry School.

The board held an executive session on economic development with Glenn Holmes, executive director of the Western Maine Economic Development Council. No action was taken after the session.

treaves@sunjournal.com