BRIDGEWATER — One of the Upper Valley towns hit hardest by flooding in July 2023 was Bridgewater, which incurred extensive damage to homes, roads and bridges.

This Town Meeting, more than 18 months after flooding brought extensive damage to the state, Bridgewater will seek voter approval to refinance two loans, totaling $3.5 million, which the town incurred to pay for infrastructure repairs. The loans currently have an interest rate of 6.5%.

The idea is to save the town money ahead of a reimbursement from the Federal Emergency Management Agency.

Because FEMA Public Assistance is a reimbursement program, infrastructure work is only repaid as it is completed, so affected towns have to cover the initial cost of repairs. In Bridgewater, this has been especially difficult and meant the town has had to acquire multiple loans from Mascoma Bank and the Vermont Bond Bank.

“The Town is in a cash flow crunch due to the delay in reimbursement from FEMA in approved infrastructure projects and it is uncertain when the funding for the approved projects will be reimbursed,” a January letter from auditor Ron Smith says. “The Town has also exhausted many if not all of its reserve and general fund cash flow to also pay for these infrastructure needs.”

So far, repairs have cost about $6 million and the work is not done yet, Treasurer Melissa Spear said in an interview. The town has received just over $3 million in federal reimbursements issued by the state.

There are about four projects that still need to be completed, including work on a bridge on Hale Hollow Road, a box culvert on Pearson Road and some “major repairs” on other town roads, Spear said. The estimated cost of these projects is still unknown, though other bridge repairs completed so far cost about $500,000 each.

Smith audited Bridgewater’s finances and reported in a January meeting that the town did not have the cash flow to make it through the end of the year. He recommended refinancing the two loans and trying to seek additional funds to pay for projects that will be done this spring.

Following Smith ‘s recommendations, the town held a special town meeting in January where voters rejected — by a three vote margin — a motion that would have given the Selectboard the authority to issue $6 million in revenue anticipation notes to cover the two loans, deficits and a $1 million buffer for upcoming repairs.

After the vote failed, Bridgewater resident Don McNeil asked the board to add the refinancing item to the March warning without including the other costs because “tying two things together is not the way that people are going to vote for what you want,” McNeil said in a recording of a Jan. 14 Selectboard meeting.

In order for the motion to pass at Town Meeting, it will need to be amended on the floor, because the town has received additional reimbursement that allowed Spear to pay off one of the loans, she said. Bridgewater now only has to pay back one $2.5 million loan at the 6.5% interest rate.

Even if the item passes at Town Meeting, Spear said by the time it can be acted on it will likely be a “moot point” because the town is well on its way to recouping the cost of completed work.

The state has sent an additional $1.5 million to Bridgewater and the disbursements are either processing or waiting on the applicant’s signature to be transferred, according to Vermont Public Assistance Officer Kim Canarecci.

In total, Bridgewater is working with FEMA to pay for 28 projects, though some include multiple components, Spear said. For example, work on several roads was counted as one project at the recommendation of FEMA project managers.

The FEMA public assistance process can take time and varies from town to town because it is an “applicant driven” multi-step process that requires towns to submit extensive documentation of the damages and estimated cost of repair, FEMA Federal Coordinating Officer William Roy said.

The documents are reviewed and approved by FEMA before the funding is distributed to the state. From there, the Vermont Emergency Management Department distributes the funds to towns as work is completed.

“We depend upon the applicant to provide the required information we need to move forward with a project and that can be a challenge sometimes for small communities,” Roy said.

FEMA assigns staff to help towns through the process, but in some cases this has made things more complicated.

The process definitely involved a “learning curve,” Spear said. While the FEMA staff assigned to Bridgewater have been helpful, turnover in the assignments often made the already “cumbersome” process more complicated.

“Things were being kicked back to us and I felt like we were reiterating,” Spear said.

Bridgewater is not the only town still working on 2023 flood repairs and waiting on federal funding. As of Monday, FEMA had obligated 84% of more than 1,500 public assistance projects statewide for the July 2023 flooding, a FEMA spokesperson said via email. That means these projects were approved by FEMA and have now been or will be repaid by the state of Vermont when the projects are complete.

Chelsea, another hard hit Upper Valley town, is working on 12 projects with FEMA and has received about $4,000 so far for one project. Five others have been obligated but are not yet complete so the town has not been paid back, Town Administrator Tierney Farago said.

The town has been assigned five different project managers by FEMA since July 2023, Farago said.

“With each changing person we get new information that we weren’t aware of before, so it definitely has not been a straightforward process,” Farago said.

Though FEMA continues to obligate funding for the disaster, there is some fear that President Donald Trump’s executive orders will threaten funding. In January, Trump issued an executive order creating a committee to review FEMA operations and, as reported by NPR, more than 200 FEMA employees were fired nationwide last week.

For her part, Farago said she is working to get funding “as quickly as possible” to avoid any issues, and has heard from FEMA staff that they have been “directed to continue as normal.”

In contrast, Spear said she feels confident that Bridgewater will ultimately receive all of its funding and, even if disbursements are paused: “I don’t think President Trump’s going to withhold the money forever.”

Bridgewater Town Meeting will take place at the Bridgewater Community Center, 76 Southgate Loop, on Tuesday, March 4 at 9 a.m.

Clare Shanahan can be reached at cshanahan@vnews.com or 603-727-3216.