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Loudon Utilities Board discussed at a workshop last week a memorandum of understanding to support a water infrastructure project at Tennessee National.

The proposal was presented for approval Aug. 22, but the board declined to take action, citing the need for more due diligence.

The MOU, which would remain in effect until Aug. 22, 2024, sets forth various water facility improvements a recent water model indicates are needed for the continued buildout of the housing development. The MOU includes a division of responsibilities, as well as when and who will perform the work.

The agreement specifies the need for a secondary water main in the development, a new 1 million gallon water storage tank at or nearby and a booster pump station in the development.

The developer is obligated to install the secondary water main from Corporate Park Drive and the water booster pump from the “ridge” pond site within two years of the date of the agreement. Tennessee National will need a letter of credit with a two-year expiration date.

LUB is obligated to complete the water tank project, which will be located beside the existing Matlock Bend water storage tank, within two years. The developer is responsible for paying 50% of the actual cost of the tank with the utility paying 50%. The developer will collateralize 50% of the cost with a letter of credit with a two-year expiration date.

“They’re paying for everything save the water tank,” LUB General Manager Ty Ross said.

Ross said the utility should manage construction of the water tank because it has recent experience installing a water tank on Watt Cemetery Road. He said the added infrastructure would also serve the Monterrey Mushroom plant, CVS warehouse and other residents on Matlock Bend.

A second booster pump will be added to the existing Roberson Springs station. Ross said the utility had already budgeted the $300,000 cost of the second pump, which would increase reliability of the system.

“This was in our existing plan already,” he said.

Bart Watson, LUB board member, asked Ross how the utility would pay for the projects.

The utility will borrow about $1 million and the projects would be paid back within seven years, he said.

Jack Qualls, Loudon County Economic Development Agency executive director, told the board Aug. 22 about the potential for millions in tax and utility revenue that could come from Tennessee National’s expansion.

Watson asked whether the development, which includes a golf course, could procure irrigation water from the river. Ross said that is already happening.

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