The Vidalia Board of Alderman during its regular meeting Tuesday night authorized Mayor Buz Craft to apply for up to $7 million in electric utility revenue bonds.
Permission to do so ultimately must be approved by the State Bond Commission.
The $7 million line of credit is to be used for construction of a new substation to meet future demand for electrical power.
Also at the meeting, Craft announced that $795,000 in utility rebate checks were printed Wednesday and will possibly be mailed Friday.
“By next week, the checks will be in the mail,” Craft said.
Concerning a new substation, Craft, aldermen and the audience wrangled for nearly an hour before a decision was made. The majority of those in attendance seemed to agree on the substation need, but the prospect of borrowing millions of dollars did draw questions.
Alderwoman Sabrina Dore’ was the most outspoken concerning the loan.
“We need to separate this into two conversations: the need for electricity, and the need for a loan,” Dore’ said. “These are two separate conversations. We need electricity, but do we need a loan?”
Craft assured Dore’ that Vidalia’s current utility customers would not see an increase in their bills and future rebates were safe.
“Number one, “Craft said, “this is not going to increase and be on the backs of the people because right now the people have been paying the fixed costs of the electrical system. Through hard work, we are growing as a town. This is a growing pain, and it is something we have to have.
“It is not going to cost the existing customer anything. You are not going to lose your rebate. It is not going to cost you your future rebates. It is not going to cause your electricity bill to go up. We are going to pay for this out of the revenues from our new clients - our industrial people.”
Alderman Tommy Probst and Dore’ said aldermen were not presented a plan for the substation.
According to Craft, he and Probst met “two or three weeks ago” and discussed substation plans “in length.”
The need for a new substation became apparent in 2011 after one of Vidalia’s two substation transformers failed and put the town in considerable risk.
Normally, substation transformers have a 30-50 year lifespan, Jeremy McElwee of Vidalia’s utility department said. The failed transformer was only 16 years old and took one year to rebuild.
“(After the incident) this has been an ongoing process,” McElwee said. “If we continue to grow like we have been growing, we will need more power.”
McElwee said new substation construction normally takes two to three years to complete and get online.
“It takes at least one year to get a new transformer,” McElwee said. “And you are looking at six months to a year on the (construction of the) substation yard. In that two to three years, we will have a lot of industry coming online. In the next two to three years, we will be topped out with the industrial transformer.
“We need to be proactive and look far enough ahead into the future because if we don’t, we are going to get to a point where we don’t have the power to run new business.”
Alderman Triand McCoy made the motion to go forward with the application with a second following from Jon Betts.
Immediately after the second, Dore’ sought to add a motion decreasing the amount from $7 million to $4 million, a move that displeased some in the audience.
However, the motion for $7 million was unanimously passed.
Also at the meeting, Craft announced that he would be seeking re-election as mayor in 2020.