Gov. Mike Rounds recommended the funding, which was approved when the board met Thursday and Friday in Pierre. This $700,000 amendment will be added to a $3,631,000 Drinking Water State Revolving Fund loan awarded to the rural water system in September 2005 and a $500,000 Consolidated grant awarded in March 2005 for the expansion project.
The additional $700,000 was needed after bids for the expansion project were higher than expected.
"Clay Rural Water officials have been working hard to develop a project to expand their drinking water system into southern Union County to serve 90 rural users and several housing developments," said Rounds. "This additional loan will help them complete their expansion and bring a safe, reliable drinking water supply to new customers."
Rural water system officials propose to purchase and upgrade the existing drinking water treatment plant at the Wynstone housing development to provide additional capacity and water treatment. This plant will be the primary water source for the project. The project will also include a new 200,000 gallon elevated storage tank.
The total estimated cost of the project is $5,413,000. The loan will be at 3.25 percent for 30 years.
The EPA Drinking Water State Revolving Fund provides low interest loans for public drinking water system projects.