By Ashley Rader
Elizabethton’s director of utilities told City Council Wednesday its application for a low-interest loan could reap benefits even beyond its effective interest rate of less than one percent.
City Council approved an application for a $650,000 State Revolving Loan Fund grant to be used to reduce water loss in the East Side community.
Director of Utilities Johann Coetzee said the East Side area was the worst in the city’s system for water loss because of leaks.
The loan will pay for the installation of new meters and water lines in that area.
The $650,000 loan would come with $195,000 in principal forgiveness, which would mean the city would have to repay $455,000. The loan would come with an interest rate of .77 percent.
Coetzee said the funds for the loan principal and interest were already included in the utility department’s budget.
“When we reduce our water loss, we are actually going to be making our money back, so this will be a gain for us,” Coetzee said. “We will not only be getting this grant. We will make money when the water loss is reduced, and that is fantastic.”