MAGNOLIA, Del. - Time has taken a toll on the town's old water tower, but financial challenges have delayed a potential replacement project.
According to Magnolia's mayor, James Frazier, the structure was built in 1928 and is in dire need of an upgrade.
"That is something that keeps me awake at night," said the mayor.
House Bill 38, signed by Gov. John Carney earlier this year, raised the town's borrowing limit from $15,000 to $50,000.
HB38 sponsor, Rep. Charles Postles (R-Magnolia), explained it as "a charter change to give Magnolia more authority to borrow money for any capital projects they had."
This prompted Magnolia town officials to pursue multiple loans that could help repair the water system.
The town was then offered an $850,000 loan from the state, which was initially believed to come with principal forgiveness.
"At the last moment, they were told it was not going to be a forgiven loan," Rep. Postles noted.
The loan entailed an annual repayment of approximately $50,000, a figure that Mayor Frazier emphasized would have posed a significant financial burden on the town's modest $150,000 annual budget.
Frazier said the only feasible source for such funds would have been community members' pockets, which would require doubling customers' water bills. Town Council ultimately declined the loan.
"We are not living large in Magnolia; we have some really nice structures, but we have a fair number of folks who are struggling paycheck to paycheck," Mayor Frazier said.
He worries the formula used to determine affordability may not adequately consider the town's relatively small population of water customers.
"If you start crunching the numbers and include the whole population of the 19962 zip code, you're obviously going to have a higher affordability rating than you would if you just focused on the roughly 325 actual users of the water system."
Frazier said the town now plans to use available American Rescue Plan Act (ARPA) funding to create a water tower replacement plan and continue searching for grants. This way, when they secure funding, the planning process will already be complete.
