BY ROGER SMITH
MOUNTAIN CITIZEN

INEZ — The Martin County Water District board has set in motion a plan to refinance two existing loans, projecting savings of approximately $817,902 over an extended period. This board finalized this decision during a special meeting Thursday at the Alliance Water Resources office in Inez.

The board unanimously approved a resolution to secure a new loan of $1.3 million from the Kentucky Infrastructure Authority (KIA) via the Water Management Assistance Fund. This loan features a 20-year duration with a 0% interest rate. Additionally, it includes a clause for 50% principal forgiveness, set to take effect July 1, 2027.

Craig Miller, the manager of Alliance Water Resources, explained the financial mechanics behind this move. The fresh funds will be utilized to refinance two older loans: a $1.3 million KIA loan dated Nov. 1, 1996, with a 3% interest rate and a $1.1 million loan from the Kentucky Rural Water Finance Corporation dated April 20, 2022, carrying a 3.25% interest rate.

The district’s new annual repayment obligation is set at $66,181.

“It will reduce the KIA payment and lower costs operationally through the year,” Miller said.

Under the terms of a Jan. 17 order from the Kentucky Public Service Commission, the district will have paid $264,725 in principal after four years. This will leave a remaining principal balance of $1,058,899, half of which, amounting to $529,449, is slated for forgiveness by KIA in 2027.

Miller expressed confidence in the deal.

“In 2027, as long as we stay in compliance, they will give us a 50% forgiveness of that loan,” he said. “You’re never going to get a better deal.”

Board members Nina McCoy, BJ Slone and Jimmy Don Kerr voted in favor of the resolution. Board members Greg Crum and John Paul Hensley did not attend the meeting.