The city is poised to approve borrowing $3 million in revenue bonds on Tuesday for renovations at Propst Park.
But before actually trying to sell those bonds, one of the city’s bond consultants is advising it wait until project bids are in-hand and the Fiscal Year 2021 audit is complete.
“If we can hold the financing piece a little bit longer to complete that audit, I think that will potentially help with the breadth of purchasers,” Nick Schorr, with Madison-based Government Consultants, told council members during a Thursday work session at City Hall.
Schorr noted the audit, being completed by the Watkins, Ward and Stafford firm, should be finished within 30 days. Mayor Keith Gaskin told The Dispatch after the meeting that the firm had set that time frame as a “realistic” goal.
The city approved a resolution of intent to issue bonds to support a $4.4 million parks renovation, with the majority committed to improving Propst Park. Of the total, $643,000 would be spread across seven community centers and $250,000 would be set aside for maintenance.
It would repay the bonds through the 2% tourism tax, collected on prepared food and beverage sales, which will provide the city $400,000 annually over the next 10 years. The city already has more than $1.4 million to put toward the project from the previous four years of collections.
The intent resolution triggered a period where the city had to advertise the resolution and citizens could protest. More than 900 citizens protested the city taking on the debt, either through signed petitions or emails to City Hall by the July 18 deadline, but that falls short of the 1,500 registered voters legally required to force the action to a public vote.
Gaskin asked Schorr if the completed audit could help the city obtain a lower interest rate on the bonds. Current estimates show the city could pay as much as $1 million in interest and fees to borrow the money.
“It’s part of (it), right? There’s a lot of factors that go into it,” Schorr said. “Obviously, having those up-to-date financials changes in terms of the number of purchasers. … The more current and up-to-date you can get, the more comfortable you can get to find purchasers who want to make an offer to buy into your obligation.”
As for waiting for the construction bids to come in, Schorr said that was simply matching financing to needs.
“Generally, we take the position that we don’t want to just move forward and deliver the funds, (then) the project bids end up coming in less … or more,” he said.
City Engineer Kevin Stafford, with Neel-Schaffer, said he has been working with Parks Director Greg Lewis on plans within the $1.4 million the city already has. Stafford expects a 90 to 95% design for the first phase of the project – switching the softball fields and baseball fields – should be ready as soon as next week.
That will cost about $1 million, he estimated, while the remainder will be used for roof repairs at parks across the city.
Once the council formally approves issuing the bond, Stafford said necessary bids packages for the remainder of the $4.4 million project could follow quickly.
Paving
During the work session, the council also began discussions for how it would parse out money for its next round of paving projects.
The city expects to have $6.9 million by July 2024 for paving, mostly from the internet use tax that can only be spent on roads and bridges. That amount would cover a paving program without borrowing funds, city officials said.
Stafford said he has ridden through the city with Gaskin already and plans to ride with each councilman through his or her ward to compile a paving priority list over the next three or four months.
In the past, the council has divided money evenly among the wards to attack individual priority lists. Stafford proposed the council could modify the approach this time around, setting a minimum and maximum amount for each ward and appropriating funds within that range according to need.
Gaskin noted in past years, there had been a “Ward 7, for the mayor” included in the division, noting he wanted to improve some city-owned parking lots.
Stafford said historically that amount has been much smaller than the other wards’ shares and usually dealt with citywide needs, specifically parking lots.
Zack Plair is the managing editor for The Dispatch.
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