John Day may be eligible for economic recovery funding after last spring’s floods.

On Jan. 14, the John Day City Council discussed its interest in seeking assistance from the Economic Development Administration, which could potentially provide funding for various projects in the Innovation Gateway.

John Day City Manager Nick Green said the EDA’s Economic Adjustment Assistance program provides funds for communities under a federal disaster declaration. Because the floods were declared a federal disaster and because the city has a Comprehensive Economic Diversification Strategy approved and funded by the EDA, the city can apply for economic assistance and recovery, Green said.

“They have a lot of funding allocated and approved to spend that no one has applied for,” Green said. “Within the scope of the EDA grant, you have to have a nexus to your disaster, CEDS and projects. In other words, they don’t just look at it as fixing a street that failed, they look at it as fixing a street that failed and also installing fiber-optic lines that could help the economy.”

Green said the applications are not easy because of an abundant amount of paperwork and due diligence required, but added that much of the work was already done when applying for the BUILD and broadband grants and from the work involved in the Innovation Gateway Area Plan.

The goal is to receive $15 million, Green said. The grant funding would require a 20% match, and while local and state funding can be used for the match, federal funds cannot be used, Green said.

“We are estimating we’ll spend $5-6 million in local funds on the new wastewater treatment plant, and the new hotel is another $6 million,” Green said. “Our goal would be to use those investments, plus the local contribution for our planned street improvement projects at the Innovation Gateway, to secure federal funding through the EDA.”

A $15 million federal grant means the city would need $3 million in local investment. Green said the city already has four times that amount committed to these projects.

The components of the Innovation Gateway Project outlined in the area plan and CEDS would be the focus of the application, Green said.

Councilor Elliot Sky asked if having a broad or narrow focus would increase the chances of success for funding.

“Reading through the application instructions, they want to see that it’s an investment priority, they want to see a return and are encouraging multi-dimensional projects,” Green said. “Anywhere we go with new streets for new housing, OTEC and Ortelco and our other utility providers would go to their capital outlay to service those lots, which would count towards our local contribution.”

Green said it could be viewed as a broad-based public-private partnership where an electric cooperative, a local government and two for-profit companies would share resources with the federal government and three private utility providers.

“What’s not to like,” Green said. “This is maximizing public benefit, it’s syndicating risk, creating value and we are exceeding the requirements. The nexus is clear in my mind because of the disaster from the flood.”

The city council will hold a work session to prioritize project elements and help frame the narrative for the application. This will be sent to the program officer in Seattle, Washington, for feedback. Green will then present the final scope of the project to the council for approval before the final submission.

The application must be submitted by July, Green said, and a decision will be made within 60 days of the city submitting the application.

“Regardless of the outcome of this particular grant, our goal is to continue to pursue multiple investment partners and funding sources to help our community succeed and recover from our extended recession,” said Green.

In other city council news:

• The city approved a resolution that raised the base monthly rate of water by $1, making the rate $33.

The resolution also officially adds a drip allowance for all customers during periods with freezing temperatures. While this has always been a city practice, it has never been documented. The allowance will allow up to 500 gallons per unit, but will be determined by the director annually based on need, according to the resolution.

The raise will help with future improvements and keeping up with increasing costs of labor and equipment, Green said.

A community member asked the council why the city continues to raise rates because one of the reasons cited was to help the city compete for grants, which seems to have been fulfilled.

“Auditors that we have recommended it because we are barley in the black, and we are not high enough in the black to cover major break downs and stuff like that,” Councilor David Holland said. “They want us to get a little better in the black and recommend that we slightly raise rates.”

• The city approved a resolution that raised the base monthly rate of the sewer service by $1, making the rate $48 for living units and schools, $54 for service stations, garages and tire shops, $64.50 for hotels, motels, RV parks, laundries, food, meat and dairy processing units and $52 for all other units.