Nibley's new well: a $3.5 million state loan the FY2027 budget still lists as proposed debt

Nibley plans to borrow from the state to build a new culinary water well, and the records show the financing in stages: a ceiling the council could authorize, the loan the state approved, and debt the city says it will take on. ^[1][6]

The notice

A July 15, 2025 notice set a July 31 public hearing on issuing up to $3.8 million in taxable water revenue bonds to pay for water system improvements, including a culinary water well. ^[1]

The notice said the state Drinking Water Board had approved a $3.5 million loan carrying a hardship grant assessment, in lieu of interest, of 2.5% a year over 20 years, at an estimated total cost of $4,451,185. At the maximum terms of 25 years and 2.5%, the notice put the cost at $5,114,231. ^[1]

The notice said no property taxes would be pledged and that the city had no bonds secured by water revenues. ^[1]

The council action

The July 31, 2025 agenda listed Resolution 25-26, authorizing the issuance and sale of taxable water revenue bonds, Series 2025, for a first reading. ^[2]

The council's minutes, a scanned document that The Ledger first could not read, record the outcome. After a public hearing that closed at 10:25 p.m., City Manager Justin Maughan and City Attorney Eric Johnson answered questions. Councilmember Erin Mann moved to adopt Resolution 25-26 on first reading and waive the second reading, and Councilmember Norman Larsen seconded. Larsen, Kay Sweeten, Mann and Garrett Mansell voted yes. The minutes say the motion passed 4-0, and that Councilmember Nathan Laursen was absent. ^[7]

The resolution authorizes the bonds. The minutes do not show that they were sold, what terms they carry, how much of the state loan has been advanced or what the drilling contract costs. The minutes carry Planning and Zoning Commission page footers, but they open as a meeting of the City Council, so the Ledger treats them as the council's record. The signed copy carries the assistant recorder's name and no approval date. ^[7]

The city's audited statements for the year ended June 30, 2025, a month before that meeting, list no water bonds; its revenue bonds were for sewer and the municipal building authority. ^[5]

The well

In May 2025, the council voted 5-0 to issue a notice to proceed and approve a contract with High Plaines Drilling to drill the new well. The minutes say one bid was rejected and three others were received, and that Sunrise Engineering recommended locking in the bid price. They don't give the contract amount. ^[3]

At the same meeting the council accepted a $400,000 federal Bureau of Reclamation grant tied to the test well and design. In September 2025, staff reported that drilling was going well. ^[3][4]

In the budget

The fiscal 2027 budget lists $3.5 million under "Proposed New Debt that will be entered into for the new well and tank" and says the city intends to borrow for the portion not covered by grants. It budgets grant revenue of $400,000 from the Bureau of Reclamation and $760,000 in a line labeled DWRE for the well. ^[6]

The water impact fee fund begins the year with an estimated $1,897,606 and appropriates $1,764,000 of it. ^[6]