FERRIDAY — Mayor Gene Allen will sign final paperwork for an overhaul of the town’s water system Feb. 19 and look at setting a date for construction to begin.

The Louisiana Bond Commission approved a $5 million grant and a $1.6 million loan last month from the U.S. Department of Agriculture to fund the project.

The water improvement overhaul includes three separate projects — switching the city’s water supply from Old River to ground water wells, replacing outdated and non-functioning water meters and improving the town’s water treatment facility.

The town plans to repay the loan over the course of 40 years and maintain the water system with a $6 increase in water rates, which was approved at a board of aldermen meeting last year and went into effect immediately.

Allen said Tuesday evening USDA officials would be at Town Hall Feb. 19 to sign paperwork to close the loan and a construction date could be set after the signing.

Early estimates showing construction beginning this year put the project being finished by 2018.

In other news from the meeting:

Myles Hopkins of Silas Simmons, a certified public accounting and consulting firm in Natchez, presented the board with a copy of the town’s audit, which was recently filed with the Louisiana Legislative Auditor’s office.

The audit, which spanned July 1, 2012 to June 20, 2013, represented Allen’s first year in office as mayor of the town.

“The opinion is the same as it’s been for quite a few years, which is a clean opinion,” Hopkins said.

When asked by one of the board of aldermen for a general synopsis of the town’s financial situation, Hopkins told the board the town was in debt for several projects but was on the road to recovery.

“You’re not in good shape because you owe so much money, but you’re getting there,” Hopkins said. “Fines have increased and payroll has decreased…and you have some notes that will be paid off this year.

“If you stay on this road, you’ll eventually get those debts under control.”

Allen will address town residents during a “State of the City” address at 11 a.m. Feb. 27 at the Arcade Theater in downtown Ferriday.