Following the annexation of 459.6 acres of land on the city's west side last month, Sherman issued over $6 million in bonds Monday for work on the water systems of that and several other areas.
The Sherman City Council unanimously approved a bond issuance of $6,065,000 through the Greater Texoma Utility Authority for the construction of water and wastewater infrastructure throughout the city as well as repair work on the Gallagher water tower.
"This is another issuance on behalf of the city that GTUA has bid out for us," Director of Finance Mary Lawrence said. "It is mostly for our in-house utility projects, such as Preston Club water line, the Taylor-Washington Street water, Travis Street water, Canyon Creek wastewater, Swan Ridge wastewater, Gallagher tower painting and repair."
In addition to the work Lawrence listed, a document prepared by city staff for the council stated funds from the bond issuance will also help pay for utilities infrastructure in the High Country Estates area, as well as on Lamberth Road West and Highway 56 West.
"We received six bids on May 31," GTUA General Manager Drew Satterwhite said of the issuance. "The lowest bid came from Citigroup at 2.93 percent and that's for a 20-year note. GTUA then meets on June 19 and would ultimately adopt a bond resolution and we would be funded and have the money ready for projects on June 29.
The resolution passed by the council states the funds from the bond issuance will be used for the "construction, acquisition and improvement" of water and sewer systems, as well as the rehabilitation of the Gallagher elevated storage tank. While the city has already accepted a bid for the repair work on the water tower, city staff said Sherman's in-house utility crew will primarily be handling the other projects.
"I do want to just reiterate that a good chunk of these projects are projects that we'll be doing in-house," City Manager Robby Hefton said. "If you remember a year or two ago, we started to do some projects with an expanded utility crew and additional equipment we purchased. A good chunk of this will be funding to allow them to buy the materials for which they would (use to) do these type of projects. (It's) pretty significant, the amount of work we're able to do with this project with this new crew."
The resolution states the true interest cost rate for the bonds will not exceed 4.75 percent. Debt service on the bonds will be paid to GTUA with funds generated by the city's water and sewer revenues.
"Six million dollars initially may sound like a lot but these needed water projects would easily cost us at least three, four times more if city staff and us as a council had not moved forward with hiring that city crew and been a little more forward-thinking," council member Kevin Couch said. "So those upfront costs that we paid are already starting to pay themselves off a year later. I think that's a huge home run for our city."