PALO - High water last year hit the Linn County town of Palo hard. And in 2009, water could also be a big issue...but in a battle of a very different sort.

The issue this year is whether the town of Palo should invest what could be millions of dollars in a municipal water system. And the first of what could be several decisions for the nearly 1,000 residents there takes place next month.

Every home and business in Palo gets drinking water from individual private wells. After the flood of June 2009, residents could not use those wells for nearly two months due to concerns about contamination from the flood water. A town water system could solve that problem--but at a still undetermined price.

The vote now set for August 4th would not be a "yes" or "no" on a municipal water system. Rather, residents would decide whether or not to establish a town water board. Members of that board would study the question of a public water utility and then recommend a plan for a later vote.

One member of an ad hoc water board, Tom Watson, said "if we vote it in, there'll be more growth for Palo. More growth means more people paying sewer and water bills and less burdensome on everybody else."

Watson says the city has applied for $5.4-million dollars in I-JOBS funding to help pay for a system. The town could hear about that application by the end of July.

He also says a public water system would provide better fire protection and lower insurance rates for home and business owners. It would also put the community in line for more recovery and development grants. For example, one federal block grant program to encourage new home construction isn't offered to communities lacking public water.

But such a proposal will generate opposition. Some residents are happy with their private wells, and current water quality, and don't want another big utility bill now. Palo resident Philip Hughes said "everybody living in town now has had wells ok'd by the Linn County Public Health Department and there's no reason why we have to have a new well system."

Hughes also objects to the fact Palo residents turned down similar public water utility proposals twice in the last eight years.

But supporters say the flood changed the situation and the town could qualify for millions of dollars in state money to help build the system.