Escanaba council approves $4 million in loan applications to speed Lington Street reconstruction and water upgrades

The Escanaba City Council on March 21 authorized applications for two State Infrastructure Bank loans totaling $4 million to fund large-scale work on Lington Street and related drinking-water improvements.

City administration told the council that the 20‑year loan request would be paired with the city’s clean water project to allow full‑width street reconstruction and critical storm‑sewer replacement where systems are undersized or missing. A separate 15‑year loan was proposed for drinking‑water work tied to the same corridor; staff said the shorter term reflects the useful life of pavement versus storm infrastructure.

Administration estimated early repayment of roughly $300,000 per year (for the first 15 years under one scenario) and noted the city’s current annual street construction budget is about $600,000. Officials said the SIB product offers below‑market interest rates, no bond‑issuance cost, and flexibility that makes it preferable to a traditional bond or a street millage.

Councilors asked whether extra loan payments could go to principal, whether an extension would be allowed if revenues fall short, and whether the city has borrowed similar amounts for street work in the past; staff said program rules and final loan terms would determine prepayment penalties and extension options and that other financing avenues (grants and potential tax increment revenue from a future hotel/condo project) could reduce the repayment term.

A motion to apply for the 20‑year, $2 million SIB loan and a companion motion to apply for the 15‑year, $2 million SIB loan were both approved by the council. Council members said the loans would allow the city to “one‑dig” streets — completing utility replacements and paving in a single mobilization to save future costs and extend pavement life.

The council did not authorize borrowing beyond the applications; final loan acceptance and detailed terms will return to council once bids and program approvals are final.