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Septic loan program helps replace failing systems

Hubbard County septic system inspector Alan Winterberger inspects a failing system that will need to be replaced. Homeowners can use a low-interest loan program. (Sarah Smith / Enterprise)

A low-interest loan program for Hubbard County residents to replace failing septic systems is underused, according to the Environmental Services Office.

Every year about "a dozen to a dozen and a half" people participate in the 3 percent interest program that helps homeowners replace noncompliant treatment systems, Environmental Services Officer Eric Buitenwerf said.

"I couldn't tell you exactly why the numbers aren't greater as far as people that make use of it but it certainly is a good program and a good option for folks to use because the cost of a system is significant enough that a lot of people don't have that money laying around to pay for an installation in cash," Buitenwerf said.

In 1994, the Minnesota Legislature enacted initiatives to provide funding for nonpoint source water quality problems.

One portion of the initiative is the Agricultural Best Management Practices Loan Program (AgBMP), created to assist local governments improve water quality and address local environmental concerns.

The AgBMP program provides funds through local governments and lending institutions, which in turn provide low interest loans to farmers, agricultural supply businesses and rural landowners.

Although the program's primary focus was to address agricultural pollution concerns, it also encompasses on-site sewage treatment systems and shoreline and riparian stabilization practices, according to the program's Web site.

But the program also focuses on addressing nonpoint source pollution problems, including repair or upgrade of existing, non-conforming individual septic treatment systems.

"It's only for replacement of a failing system so we have to verify that through the landowners giving us a certificate of noncompliance that they have a failing system that needs to be upgraded," Buitenwerf said.

Homeowners cannot use the program to build new.

Buitenwerf said homeowners wishing to enroll in the program can fill out a one-page application and turn it in to the ESO. "That's one of the criteria of the program that we have to verify it meets the funding requirements," he said.

"Then they take that application to the participating lenders and it would be up to the lender from a pure fiscal standpoint whether they would want to issue the loan, just like any other type of loan," he said.

Local lenders that participate in the program include Citizens National Bank and State Bank of Park Rapids.

But Buitenwerf said periodically, farmers have taken advantage of the low-interest loans with a typical five-year duration.

"Every now and then we'll get an application for a manure management system or conservation tillage equipment," he said.

"It is a good deal that people should take advantage of," said Hubbard County board chair Lyle Robinson.

But Dave Hacker, a septic system professional, said in years past the program was easier to work with.

"I deal with them all the time," he said. "You used to have to just prove your income when it was a revolving loan program set up by rich people."

He said the eligibility requirements tightened significantly under the U.S. Department of Agriculture and lenders.

He said now homeowners have to ante up collateral "like a title to a pickup" to obtain a loan.

"People are not too fond of payments," he said. "A lot of them are maxed out on credit cards."

Regardless of the paperwork required, Hacker said the program is still a good deal for homeowners.

Typical septic systems run from a low of $4,000 on a two-bedroom gravity system and on up, he said. A typical homeowner, for a three-bedroom home, is looking at spending $4,800 to $7,000, Hacker said.

Alan Winterberger is a septic system inspector for the county.

"If I have to fail a system and it's always bad news, I tell them about this program because the public doesn't know this money is available," he said.

At a recent such inspection on Lake Gilmore, he informed the homeowner, who immediately applied for the loan.

Winterberger said replacing just part of a septic system necessitates a wholesale replacement and often a new well, which can add up.

"People don't under stand they have a biological sewage treatment plant in their yard," he said. "They think if the toilet flushes it works. But it needs to treat the wastewater."

The system that failed this week was letting wastewater seep into the ground, and ultimately, the lake. It never reached the system's drain field.

"There's no aerobic bacteria present to treat the wastewater," he said.

Winterberger said the loan program helps cushion the blow for homeowners who need to replace aging septic systems.

"It gives a glimmer of hope."

Sarah Smith

Sarah Smith is the outdoors editor. She covers courts, business and breaking news in addition to outdoors events.

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