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Posted on: January 27, 2022

Wastewater Agency receives State Revolving Fund Loan to fund construction of sewer system

Sarpy County and Cities Wastewater Agency logo

The Sarpy County and Cities Wastewater Agency crossed a major hurdle this week in its efforts to build a sanitary sewer system in southern Sarpy County. The Agency will use a zero-interest loan from the Nebraska Department of Environment and Energy to pay for the construction of the first phase of the new system.

“For years, Sarpy County and five Sarpy cities have worked toward a common goal of delivering sewer service to southern Sarpy County, and this approval means pipe will be going in the ground,” said Sarpy County Board Chair Don Kelly, who chairs the Wastewater Agency Board. “This is a huge milestone for the future of Sarpy County, the Omaha metro and the State of Nebraska as a whole, because sewer infrastructure is imperative to our collective growth.”

Under the agreement approved Wednesday, the Agency will receive a $69.8 million Clean Water State Revolving Fund Loan from NDEE, with no fees or interest. The Agency will use the funds to build an interceptor sewer line to carry wastewater along Springfield Creek from Fairview Road to Pflug Road near Highway 50 west of Springfield, as well as a cooling water blowdown sewer in the same area to serve nearby data centers. This system will serve new residences and businesses in southern Sarpy County, which today does not have a unified public wastewater system due to a ridgeline that cuts across the county.

The state loan requires the Agency to pay $1 million a year for the first ten years, then $3 million a year until the loan is paid off. The payments will be made using funds generated by the new sewer system, including user and connection fees.

No property tax dollars will be used to pay for the system, according to the Agency’s financial projections. However, in order for the Agency to secure the State Revolving Loan funds, Sarpy County has agreed to sign on as a co-borrower. If the Agency defaults on the loan, Sarpy County would be required to cover the annual payments. The Sarpy County Board of Commissioners on Tuesday unanimously approved a resolution agreeing to serve as a financial backup.

“While this will be a self-sustaining sewer system operated and maintained through user and connection fees, we do need a boost for initial construction,” Kelly said. “We’re confident that County property tax dollars won’t be needed because of the Agency’s strong financial position as more users join the system.”

In full, the sewer system is expected to cost approximately $250 million and be built in phases over the next 20 to 50 years. It is expected to open 44,000 acres up to development and approximately double the number of taxable parcels in the county. Development in the agency’s jurisdiction is estimated to generate incremental tax revenue of:

  • $21 million per year in sales tax revenue for Sarpy cities
  • $74 million per year in sales tax revenue for the state
  • $31 million per year in property tax revenue for Sarpy cities
  • $29 million per year in property tax revenue for Sarpy County

In 2020, the Agency signed an agreement with the City of Omaha for wastewater treatment service. Waste that flows through the system’s pipes will be treated at Omaha’s existing treatment facilities.

Construction on the new interceptor sewer line began this week.

About the Sarpy County and Cities Wastewater Agency

In September 2017, Sarpy County and the cities of Bellevue, Papillion, La Vista, Gretna and Springfield formed the Sarpy County and Cities Wastewater Agency to collectively address the need for a unified sanitary sewer system in southern Sarpy County. The agency’s task is to build the Unified Southern Sarpy Sewer System. Visit the agency’s website: Sarpy.gov/WastewaterAgency 

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