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GC water issues solution 'well' under way

MADISON - State regulators last week authorized construction of a new well and well house for the Glenwood City Municipal Water Utility to replace an aging well the Department of Natural Resources considers "unsafe" and undersized.

For the past few years, the city has been using Well #3 and keeping Well #2, a well that does not meet DNR health standards, as a backup. The $1.202 million well project allows the city to drill a new well near the water tower, abandon Well #2 and then alternate usage between Wells 2 and 3, which meets DNR recommendations to prolong the well's useful life.

The DNR required the city to update or replace Well #2, constructed in 1928 and modified in 1988. A review showed that it was almost as costly to rehabilitate Well #2 as it would be to drill a new well said, and Kevin Ouim, a consulting engineer with Cedar Corporation.

"Well #2 is in a floodplain, the existing well house is fairly old and would be costly to rehab it to code, and future expansion capacity of the well is limited," he said.

Well #2 is located along Oak Street, near the city's center, close to potential sources of contamination, according to documents filed with the Public Service Commission, than the Well #4 site, which is northeast of the intersection Third Street and Walnut Ridge Drive.

The city has contracted with Mineral Services, Inc. of Green Isle, Minn., which will begin drilling Well #4 this month and expects to finish in June, said Ouim. The well will be drilled to a depth of 750 feet, deep by area standards, but necessary because the well site is on high ground and the well needs to reach an aquifer the DNR recommends, Ouim said.

A construction bid for the well house will be awarded next month and construction should be completed by the end of the year, Ouim said. The well house, chemical equipment to treat the water, electronic controls, an emergency generator and repairs to Well #3 are part of the $1.202 million project.

The city will fund 41 percent of the well project with a Community Block Development Grant and finance the remainder with a state Safe Drinking Water Program loan, said City Clerk Shari Rosenow.

The city filed a water rate application with the PSC in October seeking a 56 percent increase in revenue and a 5 percent rate of return on the value of its infrastructure.

The city last raised rates in June 2016, a 25 percent hike for residential customers. Prior to that, the utility had not increased rates since 1993. The utility projects a $24,249 negative income this year under existing rates and needs more revenue to achieve a positive cash flow and finance the loan for the well project, Rosenow said.

Average residential customers currently pays $37.40 quarterly for 10,000 gallons of water. A 56 percent rate hike would add $20.94 to current average residential quarterly water bills bumping them up to $58.34. PSC staff has not completed a review of the water rate request, scheduled a public hearing or, recommended an amount of revenue it deems the utility needs to remain financially viable. The amount of increase will depend on the rate of return the utility will accept, customer growth, and other factors.

Between 2011 and 2015, overall water sales declined by 1.9 percent, and average gallons per residential customer declined by 3.3 percent, according to annual reports the utility files with the PSC.