RED SPRINGS — The Red Springs Board of Commissioners is looking to borrow more than $2.8 million to pay for upgrades to the town’s electrical system, meters and the roof of a building it owns.
The board on Thursday discussed ways to finance the four projects, three of which deal with the town’s electricity and water use and one to place a new roof over a portion of the Sanfatex building. John McNeill, mayor of Red Springs, said officials hope the projects will eventually pay for themselves.
“We’re not making any firm decisions,” McNeill said, “but I don’t want to get hit cold with what we’re doing and how we’re going to pay for it. In our September meeting, we will be in a position to take action on this.”
The big-ticket item, estimated to cost $1.7 million, is to upgrade electrical lines so they can carry more voltage, making them more efficient and easier to repair. Town Manager James Bennett said he is seeking a 30-year loan through the USDA.
Bennett said a private bank would expect the loan to be paid back in 15 years.
McNeill said the conversion could save the town money through peak shaving, a process that reduces the amount of energy purchased from a utility company during “peak hours,” when rates are high.
“By doing that, we will be able during the peak to still decrease the voltage,” McNeill said. “It will reduce the overall electrical usage of the town.”
The town is also considering installing smart meters for electricity and water usage that would require an $850,000 loan.
Smart meters alert the town of an electrical outage or water leak even if the customer is unaware.
“With smart metering, we will know in two to three minutes if there is a leak and the homeowner might not even know about it,” Bennett said.
The meters enable customers to see how much water or electricity they are using. McNeill said the town could offer a $5 monthly credit per switch to participating homeowners. The switch automatically turns of the hot water heater or air conditioner periodically as a means to conserve without the homeowner noticing.
McNeill said the smart meters would pay for themselves in two and a half years.
About 60 percent of the roof on the Sanfatex building needs replacing.
“Sanfatex has kind of been our cash cow,” McNeill said. “We own the building and we have three tenants in there.”
McNeill said one tenant, Dayco, said that some electrical equipment had been damaged after heavy rain. The estimated cost to replace the roof is $350,000. The town would have to borrow the money from a private bank.
Bennett said one bank estimated that the annual payment for a 10-year payback period would be $39,990.57, and the annual payment for a 15-year payback would be $29,001.13.
Gabrielle Isaac can be reached at 910-816-1989 or on Twitter @news_gabbie.