The Washington City Council met in regular session Tuesday. Photo by Sally Y. Hart

Over half a million dollars in planning and design loans were approved by the Washington City Council this week for water plant improvements. The council approved a resolution to institute proceedings to take action for the authorization of a loan and disbursement agreement not to exceed $507,000.

City Administrator Brent Hinson said the increases have already been done to support this debt. In 2012, the City started planning these improvements but at that time the water utility fund was $300,000 in the hole. That has been reversed and the rate increases for these improvements have already been done. He explained this is the first piece of financing and the plant needs upgrades.

The loan covers planning and design and engineering costs. It’s a zero percent loan from the Iowa Finance Authority and once the project is complete it will get rolled into the permanent loan with the state revolving fund with an interest rate of two percent.