MIDDLETOWN – It looks like it will cost the City of Middletown more to borrow money to repair its massive Sterling Street sewer problems.

The project is expected to cost about $2.5 million and the city is under state order to do the work.

It had hoped to secure an interest free loan from the state Environmental Facilities Corporation, but Middletown Finance Commissioner Dawn Gobeo said that may not happen.

“We do not have sufficient points to qualify under the zero percent financing with the EFC, so most likely what we can do, one option available to us is to piggy-back on EFC and get their market rate,” she said. “They triple A so we might be able to get a little less than four percent. Right now the city is looking at anywhere between four and 4 ½ percent for long term financing, but with EFC, we might be closer to four percent.”

Gobeo told the city common council that if they go that route, and they can refinance in the future, they might be eligible for a lower EFC rate.