BLANDBURG — Reade Township Municipal Authority members may have to increase water rates to satisfy pending loan requirements if an agreement can’t be made with the neighboring Glendale Valley Municipal Authority.

The Reade Authority is pursuing $2.1 million in Pennvest funds — grants, low-interest loans or a combination of the two — to cover needed improvements to its system.

Chief among those improvements is the installation of meter pits outside of the homes of each of the authority’s about 500 customers, authority Chair­man Jim Thompson said.

The installation of meter pits, which will be placed below ground near property lines, will make it easier for authority employees to monitor water use, Thomp­son said.

Once meter pits are in place, employees will be able to use a radio system to read water usage from outside of the homes, eliminating the need to approach each house, Thompson said.

The underground meters also will drastically reduce the possibility of inaccurate readings, he said.

“No one can tamper with them, bypass them,” he said, noting customers have altered readings in the past. “It makes it seem like you’re losing water.”

In addition to meter pit installation, the project will include the replacement of main water pipes in two locations, Thompson said.

Authority Engineer Pat Mulcahy, with EADS Group Inc., said pipes are to be installed to replace aging infrastructure near the authority’s wells near Cambria Mills Road.

And a second set of pipes are to be installed in the Fallentimber area, where soil conditions have caused existing ductile iron pipes to deteriorate. New pipes will be plastic, Mulcahy said.

The project, which includes other minor improvements throughout the system, is estimated to cost $2.1 million, Thompson said, explaining the authority is looking to Pennvest for funding.

“It would be nice if it would be all grant money,” he said.

However, Pennvest officials may also offer a low-interest loan, which the authority would have 20 years to pay back, Thompson said, explaining the loan would almost double the authority’s existing debt.

Reade Authority members are obligated to show that they will receive enough revenue to meet their regular loan payment obligations, Mulcahy said.

Currently a large portion of Reade’s revenue comes from the neighboring Glendale Valley Municipal Authority — Reade’s largest customer.

Glendale purchases water from the Reade Authority and redistributes it to its customers. Reade employee Georgia Marlin said those purchases amount to between $13,000 and $17,000 in revenue each month.

Pennvest officials have asked Reade Authority members to form a 20-year pact with Glendale leaders to continue the water sales agreement and incoming revenue. An existing agreement expires in 2022.

But a new agreement likely will be hard to reach, multiple Reade officials have said. The two authorities have long been at odds.

Earlier this year, Glendale officials choose to forgo a Pennvest funding application and prior interauthority agreement.

And Glendale leaders are currently considering drilling their own water wells, so they will no longer have to purchase water from the Reade authority.

Without an agreement and its promised revenue from Glendale, Reade officials will have to increase rates to meet the loan payment obligation, Thompson said.

Reade customers now pay a $35 base fee each month for up to 1,000 gallons of water and an additional $6.80 for every additional 1,000 gallons, Marlin said.

Thompson guessed base rates could increase as much as $20 per month without the interauthority agreement.

Last week, Thompson sent a letter to Pennvest officials promising to meet their requirements — the agreement or rate hike.

And at a recent meeting, Reade Authority members agreed to pursue a meeting with Glendale officials.

Reade members applied for Pennvest funds earlier this month, and grants and loans are to be awarded in October, Mulcahy said.

Mirror Staff Writer Sean Sauro is at 946-7535.