Brown Cites Examples in Columbiana, Gallia, Madison, Perry, Seneca, and Van Wert Counties 

 

WASHINGTON, D.C. - U.S. Sen. Sherrod Brown (D-OH) today called on the U.S. Department of Agriculture (USDA) to help Ohio communities maintain clean drinking water and disposal services. In a letter to USDA Sec. Tom Vilsack, Brown urged him to work with small villages and rural communities that are at risk of defaulting on their USDA wastewater loans because due to loss of a major employer and water user in the community.

“Access to safe and clean drinking water is an economic development imperative. All Ohioans deserve access to clean water, but too many communities are struggling to afford debt service payments on water and wastewater systems," Brown said. "By helping rural communities—whose financial burden for maintaining safe systems is disproportionately high— we can ensure their financial stability and ensure Ohioans pay less for their water and sewer bills."

Currently, local USDA offices have limited options to assist communities until their loans go into default.  By offering borrowers a wider variety of solutions before they enter default, USDA can help communities maintain healthy and clean drinking water and disposal services. Brown specifically noted a Seneca County community, New Riegel. The community of 226 people lost a large food process, Farmland Foods, after it took out the loan to develop its sewer system. The system was sized to handle food processing wastes from the plant, which represented 60-65 percent of the town’s sewer use. With the industry now gone, the community finds itself unable to meet its debt obligation. 

New Riegel is not the only town with this issue; similar cases exist in Wellsville in Columbiana County, Willshire in Van Wert County, South Solon in Madison County, Vinton in Gallia County, and New Straitsville in Perry County.

Brown is working to ensure that communities across Ohio have access to clean and safe water. Senator Brown, along with former Senator George V. Voinovich (R-OH), authored the Clean Water Affordability Act in April 2009. The legislation aims to update the EPA clean water affordability policy to provide for a full and accurate representation of the financial impacts clean water investment programs place on communities struggling to meet federal regulations for improving water infrastructure.

Studies indicate that for every $1 billion invested in infrastructure projects, between 35,000 and 50,000 jobs are created. Beyond job creation, investment in water and sewer infrastructure meets public health and safety needs and helps communities attract new businesses and residents.

March 23, 2011

 

The Honorable Tom Vilsack

Secretary

U.S. Department of Agriculture

1400 Independence Avenue, SW

Washington, DC 20250

 

Dear Secretary Vilsack:

 

Thank you for all that you do for small towns and rural communities in Ohio and across the nation. It has come to my attention that many small communities across Ohio are struggling to make debt service payments on water and wastewater systems. As you know, the financial burden of maintaining safe water systems is disproportionately high for small communities and has been amplified by a difficult economy and recent relocations of major water users.  Currently, many small villages and rural communities are at high risk of defaulting on their USDA wastewater loans and have few very few options to regain financial stability.  I would urge you to work with these communities before they reach the default phase.

 

Many small towns are home to just one major employer – whether it is a school, factory or other industry. As many of these large water users have closed and moved elsewhere, local residents are seeing their monthly utility bills escalate to make up lost revenue.  Across Ohio, many efforts to refinance or reamortize these loans have been unsuccessful, and many small systems are now in jeopardy of defaulting on their loans.

 

The Village of New Riegel in Seneca County, Ohio provides an excellent example of the problem.  This small village of 226 people had a large food processor, Farmland Foods, in town when its sewer system was developed.  The system was sized to handle food processing wastes from the plant, which represented 60-65% of the town’s sewer use.  With the industry now gone, the community finds itself unable to meet its debt obligation.  Unfortunately, New Riegel isn’t the only Ohio community suffering with these issues.

 

Currently, local USDA offices have limited options to give assistance to communities until their loans go into default.  By offering borrowers a wider variety of solutions before they enter default, USDA can help communities maintain healthy and clean drinking water and disposal services.

 

I look forward to our continuing work to assist small towns in Ohio and across the country. Thank you for your attention to this matter.

 

                                                                 Sincerely,

 

 

                                                                 Sherrod Brown

                                                                 United States Senator  

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