Washington is getting great deal when it comes to a loan for sewer rehabilitation.

During its meeting last week, the City Council authorized the mayor to accept the $2 million interest-free loan from the Clean Water State Revolving Fund. Of that amount, the city will pay back $1.5 million, with the remaining $500,000 of the principal forgiven.

The city will save $70,000 a year by not paying interest on the $2 million loan, or $1,050,000 over the life of the 15-year loan, said Matt Rauschenbach, the city’s chief financial officer, last week.

The project includes addressing inflow and infiltration projects.

Previously, the council authorized the city manager to execute a sewer rehabilitation contract with Rivers and Associates, which is being paid $299,000 for its work related to the sewer rehabilitation project. The contract amount is approximately 13.7 percent less than the $340,000 originally budgeted and approved by the N.C. Department of Environment and Natural Resources for professional services related to the project. Of the three companies that expressed interest in the project, Rivers and Associates was the only one to submit a proposal, according to a city memorandum.

The project includes lining existing pipeline, point repairs, pipe replacement and manhole lining.

Inflow and infiltration is when water from outside sources (mostly groundwater) enters sewer lines through cracks, holes and faulty joints. I&I adds to wastewater-treatment costs because it increased the amount of wastewater to be treated.

Two years ago, the city received a $35,000 grant to pay for an I&I study to determine where outside water enters the sewer system. That study uses visual inspection and smoke tests to locate possible I&I sites in the sewer system.

In other business, the council approved a $20,000 purchase order for Booth & Associates to perform the engineering work for the Grimesland Road electric distribution project. Booth will manage the bidding process for the project, with those bids expected later this year. The project is among several the city is undertaking to improve its electrical distribution system.