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Frank A. Douglass Insurance Agency

Torch Lake Sewer Authority getting $3 million upgrade

The United States Department of Agriculture Rural Development Program is investing millions in the area’s sewer infrastructure. Announced last Thursday, there are four projects across the Upper Peninsula, including in Houghton and Ontonagon County. Torch Lake Sewer Authority is receiving $3 million. Assistance for Carp Lake Sewer Authority totals about $1.9 million.

State Director Brandon Fewins says the upgrades are a result of the federal infrastructure bill.

Rural Development is basically the economic development arm of rural America. This fits right underneath some of our water and environmental programs. With the renewed focus of the Biden Administration geared towards infrastructure, this is just the perfect example of what the president is speaking of when he says, “Build. Back. Better.”

Each sewer authority benefitting had to apply for support from USDA. Fewins says the assistance is a combination of grants and loans.

Over in Carp Lake, that was a $713,000 loan with a $1.2 million grant.

He says rates are fixed and below what could be found in the private sector, but still determined by the overall market. It looks like the window is closing on excellent terms for borrowers in the near future, so the projects come at the right time. During the pandemic, treasuries have traded at historically low yields, brought about by loose Federal Reserve monetary policy. Quantitative easing involves the actual purchase of debt securities by the nation’s central bank, therefore ensuring bond prices remain high. Yields and price are inversely related. The more demand for a government or corporate bond, the lower return it will generate. Mortgages and commercial loans are often tied to the federal treasury rate. The Fed has signaled that it intends to hike rates three, maybe four times, throughout 2022 to cool off inflation, currently running at a 39-year high.

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