News for those who live, work and play in the Santiam Canyon

Mill City turns to Business Oregon for sewer funds

Reporter for The Canyon Weekly

Mill City has reached out to Business Oregon for help raising roughly $5 million for sewer expansion as officials attempt to avoid a slowdown in real estate development.

The city has requested a “one-stop” meeting with the state development agency to explore available financing options and get started on a funding package for the project.

City Recorder Staci Cook said identifying revenue sources has been easier than finding funds that will be available in time to expand sewer capacity without delaying planned developments.

“Getting timing and money together so that they mesh will be the largest challenge,” she said.

As of Tuesday’s Mill City Council meeting, a tentative meeting between city officials and Business Oregon has been set for April.

The city has been working to expand system capacity since learning in September, 2021, that the 30-year-old sewer plant could only handle 40 to 50 new residential hookups before being overwhelmed and consistently polluting the local aquifer. However roughly 300 new residential units are either in development or have been proposed for Mill City in the next three-to-five years, and if the system reaches maximum capacity the city would be obligated to issue a moratorium on new construction.

Mayor Tim Kirsch said Tuesday he remains optimistic a moratorium can be avoided, even as project funding remains uncertain. 

“Hopefully we’re able to come up with something that allows all these folks to move forward with their projects,” said Kirsch. “The last thing we want to do is impose some sort of building moratorium. That would not be an advantage to anybody.”

Of the 300 potential or planned units, several dozen could be added by the end of this year including a 54-unit low-income apartment complex backed by the state and county, and a 15-unit subdivision that has land use approval but has not started construction. Marion County is also in talks with Mill City for a low-income development of roughly 75 units, but no official planning has taken place.

Kirsch said it is important to avoid delaying these developments due to local housing needs, including those impacted by the Santiam Fire, and logging operations that need employee housing. He said, if anything, this housing crunch highlights how closely development and public infrastructure are dependent on each other.

Kirsch also said, as the city explores funding options, he hopes to avoid throwing good money after bad in light of a regional sewer system expected to come online in five to seven years. Kirsch said, when the regional plant is completed, the North Santiam Sewer Authority (NSSA) will purchase Mill City’s existing system, and the city should look for expansion improvements that add value to the system.

“We’ve got to remember, in the endgame when we come up with the sewer authority, the sewer authority is going to purchase the sewer system,” said Kirsch. “If [expansion] adds value to it, then hopefully we’ll see it come back to us in some other form.”

The highest priority is finding 32 acres of land for a new drainfield, which the Department of Environmental Quality is requiring to lessen pollution risks to the North Santiam River. 

Because the soil in Mill City is so porous, the field needs to be large and far enough from the river to avoid infiltration risks.

The cost of such a large parcel could be multiple millions of dollars, but Kirsch said he hopes the city can find land that will be useful to NSSA, further improving opportunities for recuperated costs. 

He said land acquisition, funding sources and other improvement options remain “a moving target” and officials are working to find the best option for Mill City and NSSA.

“It’s all up in the air, and we’re working toward a final solution, but it’s complex,” he said.

“I would say optimism is high,” said Kirsch about avoiding a development delay, “and we’re pushing to do everything we can to support all those projects.”

“The last thing we want to do is impose some sort of building moratorium. That would not be an advantage to anybody.” – Mill City Mayor Tim Kirsch

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