Waynesville seeks forgivable loans for storm-damaged utilities
Waynesville sewer plant.
File photo
Facing aging infrastructure and costly repairs made worse by Hurricane Helene, the Town of Waynesville is preparing to apply for state funding that could cover the tab for several major water and wastewater projects — at no cost to utility customers.
“This loan should turn into a grant, if the state is good to its word,” Town Manager Rob Hites told Town Council members during the July 8 meeting.
The North Carolina Department of Environmental Quality has designated Waynesville as a “distressed” community, making the town eligible for 100% principal forgiveness through the State Revolving Fund program, funded by President Joe Biden’s 2025 American Relief Act. North Carolina has set aside $409 million for water projects and $253 million for wastewater projects.
In a unanimous vote July 8, the Waynesville Town Council approved two resolutions allowing town staff to apply for funding under the SRF program.
The first is for a water project, the Browning Branch booster pump station, which is aging past its expected service life and could fail without significant refurbishment. Its replacement would ensure consistent water pressure and delivery across the system.
The second is for three wastewater projects — sewer improvements at “Little Champion,” reconstruction of the return-activated sludge/waste-activated sludge pump station and redesign of the chlorine contact chamber at the wastewater treatment plant.
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The wastewater system, in particular, has long needed major investment. Overflow incidents from the Little Champion station have affected Richland Creek, but the RAS/WAS project could not be completed due to the expense of the town’s new $29 million wastewater treatment plant coming online later this year.
Hites said that communities that are both distressed and Helene-damaged would be eligible for 100% principal forgiveness. The loans carry 0% interest and payback periods of 20 to 30 years.
Council’s vote came just minutes after Hites provided an update on the town’s second round of 0% cashflow loans offered by the state treasurer’s office to help cover immediate post-Helene recovery expenses in anticipation of FEMA reimbursements down the road. Waynesville has already come out-of-pocket for at least one major storm-related expenditure it just couldn’t wait on anymore — the Depot Street bridge, which reopened in April.
During the first round, the town asked the state treasurer’s office for $1.5 million but only received $503,000. During the second round, the town upped its estimate to $2.1 million and requested the balance of that figure from the treasurer but only got an additional $332,000.
“Clearly, that doesn’t make us whole,” Hites said.
Combined, the two loans provide approximately $836,000 in short-term budget relief for the water and sewer fund and must be repaid over four years regardless of FEMA reimbursement. For the first year, the Town owes only $1. In the second year, it must pay 10%. In the third year, it must pay 20% and in the fourth year, the remaining balance — with the expectation that somewhere along the line, FEMA will have reimbursed the town. That’s not guaranteed, but if even if it doesn’t happen, Hites said the town is in a good position to pay off the loan, if it must.
“We could pay the state back in 2029 that entire amount,” Hites said. “So I’m not real concerned.”
The resolutions will now be transmitted to NCDEQ as part of the formal application process. The town will await response from NCDEQ on whether the projects will be accepted — and whether the full amount of each loan will indeed be forgiven.
