OXFORD — The town is applying for nearly $24 million in federal funding to build a new sewer system that will serve commercial and residential users along Route 26 and in other parts of Oxford.

Selectmen plan to hold a public hearing on April 18 to discuss the town’s application for $23,890,000 in funding from the U.S. Department of Agriculture’s Rural Development program.

In a phone interview last week, Town Manager Michael Chammings said the application includes a combination of loans and possibly grants that will help the town build both phases of the project.

Last April, Selectmen approved borrowing $13.7 million through a Maine Department of Environmental Protection and the Maine Municipal Bond Bank to fund construction of the project’s first phase. At a special town meeting in December 2012, Oxford voters approved borrowing more than $20.2 million to fund the project.

Phase I includes construction of the sewer plant itself and installing sewer lines and pump stations along Route 26 from the Mechanic Falls town line to Fore Street, within the town’s commercially-advantageous Omnibus Tax Incentive Financing District.

The second phase of the project includes installing sewer lines north on Route 26 and west into residential sections of the town.

Chammings said the town intends to use Rural Development funding to help pay down the DEP loan after it refinances following construction. He previously said that TIF funds and user fees will also be used to pay down the town’s construction loan.

If Rural Development funding falls through, the town may postpone the second phase of the project, Chammings said at a meeting last Thursday.

The first phase is being timed to coincide with construction of a 90-room hotel and restaurant across from the Oxford Casino on Route 26.

Chammings could not provide a copy of the town’s funding application and said he had not kept any working documents on the project.

A request for the application submitted to the Rural Development program last week was denied because it is not considered public information, according to USDA spokesperson Emily Cannon.

The agency’s Maine office received “guidance” from the national office that “until a proposal or application is approved, it is not subject to (Freedom of Information Act) release guidelines and we do not have the authority to release information on an applicant. At this point, the town is not considered a USDA borrower,” Cannon wrote in an email.

Cannon did not respond to an follow-up email requesting clarification about what state or federal law or regulation allowed USDA to keep the application’s content a secret.

Brent Bridges, a vice president from the Woodard and Curran engineering firm, told selectmen at a meeting last week that groundbreaking on the project should begin by Memorial Day.

The town is still finalizing land purchases along Route 26 for the pump stations and needs to finish getting 43 easements from property owners so it can put in sewer lines, Chammings said.

So far, the town has spent more than $175,400 purchasing property, including $142,996 to buy 0.66 acres at the proposed treatment plant site on Route 121 from Bob Bahre’s Speedway Inc. The figures are the full cost of acquiring the properties, not necessarily what the owners were paid, Chammings said.

On Thursday, Chammings said Speedway Inc. bought the plot with the intention to re-sell it, at cost, to the town. So far, the town has stayed well within its $200,000 budget for property purchases, Chammings said.

According to Bridges, bidding for construction of the project is expected to begin within a month’s time. Woodard and Curran are still working on a final design for the treatment plant, which uses a state-of-the-art ultraviolet treatment system — instead of chemicals — to sterilize waste water. Last December, selectmen bought a $1.2 million treatment system from Ovivo USA.