DONGOLA, Ill. -- Construction of a new water-treatment and distribution center that will serve as many as 2,700 families in three Southern Illinois counties by early 1998 could get under way within 10 days.

Loans were closed, grants signed and pre-construction meetings held with contractors during a SouthWater Inc. meeting at the offices of Southern Illinois Electric Cooperative (SIEC) near here Friday.

"We can see construction starting within 10 days to two weeks," said Glen Clarida of Clarida Engineering of Marion, which helped design the SouthWater project.

Southwater Inc. is a not-for-profit corporation created by SIEC four years ago to provide safe water to residents in Alexander and Pulaski counties and a portion Union County in the first phase of the $20 million project.

The new water-processing plant will be alongside the Olive Branch-Tamms Blacktop south of Egyptian High School in Alexander County.

Phase I construction also includes 59 miles of transmission pipe, which will provide water wholesale to a half-dozen water districts -- Pulaski, Mill Creek, Mounds, Dongola, the McClure-East Cape Water District and the Central Alexander County Public Water District, which have already agreed to use the water service.

A number of individuals have already signed on as retail customers of SouthWater.

"Phase I will serve from 2,600 to 2,700 users," said Larry Lovell, executive vice president of SIEC, which will provide management services for SouthWater.

Phase II will include another wholesale user -- Ullin -- and a number of individuals. This will boost the overall user list to more than 3,000.

"We hope to see Phase I water service start in early 1998," said Lovell.

SouthWater representatives met with eight contractors Friday afternoon. They included contractors for the water plant, water towers, plant equipment, well and water lines.

"It may seem that this system is taking a long time," said Marvin N. Teckenbrock, district director of the U.S. Department of Agriculture's Rural Development. "But for a system of this size, we're moving along good."

Teckenbrock traced the history of the project from its start on Nov. 18, 1993, to Friday's meeting at Dongola.

"The regional water concept is great for economic growth," he said. "Water is important to people living in the area and to industrial prospects."

Dick Lockwood of the office of Economic Development at Marion agreed.

"We need good water," he said. "The SouthWater system started cold turkey in 1973, and today we're looking forward to the start of construction of a system that will provide good water throughout the immediate area."

On hand for Friday's meeting were representatives from the offices of U.S. Reps. Jerry Costello, D-Belleville, and Glenn Poshard, D-Marion, and state Rep. David Phelps, D-Eldorado.

For Phase I, SouthWater will receive $4 million in grants and $3.8 million in loans from Rural Development, formerly known as the Farmers Home Administration. The Illinois Department of Commerce and Community Affairs has committed $2 million to the project.

Tentative plans call for building a 2.4 million-gallon-a-day water-treatment plant, three wells, a booster pump station, a 500,000-gallon ground storage tank, a 750,000-gallon elevated storage tank and 59 miles of 8-, 10- and 12-inch water mains with valves and meters.