A decision made by the Oxford Township Board last week is going to save municipal sewer users a huge chunk of money over the next two decades.

In a 7-0 vote, officials voted to “prepay in full” a special assessment that’s going to be imposed by the Clinton River Water Resource Recovery Facility Drainage District to help fund an estimated $38.5 million in improvements to two wastewater treatment facilities in Pontiac. The amount of this assessment is estimated to be $760,262.

The full amount must be paid to the district on or before June 15.

Oxford Township is one of 13 communities that make up the drainage district.

To fund the project, the drainage district is planning to sell bonds in an amount not to exceed $42 million. This bond debt would be paid off over a period of 20 years at an estimated interest rate of 2.5 percent.

Had township officials chose to be part of the bond and help pay off the debt over time, Oxford would have been responsible for the estimated $760,262 in principal, plus an estimated $231,017 in interest. This would have increased the township’s total obligation to an estimated $991,279 over 20 years.

Those estimates are lower than the ones previously given to the township. Originally, the township was expected to owe $775,740 in principal, plus $235,735 in interest.

By paying all the principal up front, the township will not be responsible for any interest payments.

The township’s sewer fund can handle this payment. As of April 1, it has a cash balance of $3.13 million.

Prepaying sewer bonds is nothing new to the township. In order to avoid interest costs, it has previously prepaid a total of $1.478 million for four bonds related to the Oakland-Macomb Interceptor Drain, to which Oxford is connected.

Improvements are needed at the two Pontiac wastewater treatment plants because “most” of the current equipment “is beyond its useful life and is not performing at optimal levels,” according to a March 30 letter to the township from engineer Steven A. Korth, a manager for the Oakland County Water Resources Commissioner’s (WRC) Office.

One facility went into service in 1921, while the other was constructed in 1962. Both were renovated in the 1980s and upgrades were made to both in 2010, 2012 and 2014, according to Korth’s letter.

In 2015, these facilities began receiving wastewater flow diverted from the Clinton Oakland Interceptor Drain.

“Improvements are necessary to efficiently accommodate this extra flow,” Korth wrote.