Utility exploring options to deal with big debt

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Published: August 2,2010

Tags: energy, utilities

BAY ST. LOUIS — The Hancock County Utility Authority is looking for options other than raising customers bills to pay off a $10.6-million debt.

However, the authority’s board of directors say a $10 per household per month increase may be the only way to deal with debt.

The authority owes more than $10.6 million. Payments were deferred in 2005 after Hurricane Katrina. Payments of more than $87,000 each, mostly for utility construction projects, are scheduled to resume on Oct. 1.

Authority board members decided this week that they will ask the governor’s office if surplus Community Development Block Grant funds, already dedicated to the authority, can be used as partial payment on the debt.

Authority director David Pitalo tells the Sea Coast Echo that the debt was incurred by the former Southern Regional Wastewater Treatment Authority, which was replaced by the Utility Authority after Katrina. The new authority inherited the old wastewater authority’s assets and debts.

The debt stems from 2001. Twenty-nine debt payments had been made by 2005, then were deferred because of Katrina.

Officials say it’s unclear how much of a surplus the authority may have in CDBG money, since projects are still under way. They say it is unlikely to cover the whole debt.

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