Mayor Keith Gaskin broke a tie during a Friday morning special call meeting to kill an effort to sell about $3 million in revenue bonds intended for a $4.4 million parks renovation plan that would have mostly focused on improving Propst Park.
Friday morning Gaskin, Chief Financial Officer James Brigham and Government Consultants Financial Advisor Nnamdi Thompson presented an offer from Mississippi Development Bank at an interest rate of 5.35% over 10 years.
The council voted in August to begin the process of selling the bonds, which would have complemented about $1.7 million in proceeds from the 2% tourism tax the city already has on hand.
The tourism tax collects an extra 2% on prepared food and beverage sales within the city limits. The funds from that tax may only be used to fund recreation.
The lion’s share of the bond money would have gone towards Propst Park’s softball and baseball fields. It would have also improved playgrounds and the splash pad, installed pickleball courts and upgraded lighting at the Field of Dreams.
The city only got one bid on the bonds, Brigham said.
“The demand right now is low, and there is a lot of uncertainty in the economy and interest rates continue to rise,” Brigham said.
“(Government Consultants) said there is significant risk that the interest rate will continue to go up in the short term.”
The average yearly payment on the bond would be around $389,335, Brigham said, which is within the $400,000 revenue stream the city receives annually from the tourism tax.
Ward 3 Councilman Rusty Greene asked if the city would be better off holding off for a year to borrow money while it uses the approximately $1.7 million it already has on hand, but Brigham didn’t think that was a good idea.
“It could be a loss for the city,” Brigham said. “… If there’s any significant shift in the interest rate (upwards), it would cost us.”
Greene asked if the city might get a lower interest rate once the Fiscal Year 2021 audit was complete.
The city is still working to complete its FY 2021 audit, which is being conducted by Watkins, Ward and Stafford. The FY 2020 audit was completed earlier this year. It found the city overspent its budget by $3 million, and lacked many internal controls.
Brigham said it probably wouldn’t help.
“The 2021 audit is still not going to be pretty,” Brigham said. “There will still be a lot of exceptions. It will be very much like the 2020 audit, which had some internal control findings. I don’t know that you can bank on … the banks making that much of an adjustment.”
Ward 5 Councilman Stephen Jones attempted to prod things along.
“We know it’s not about the interest,” Jones said. “It’s not about anything for (Greene). He didn’t want to do it in the first place. Either we’re going to vote on it or we’re not.”
Ward 4 Councilman Pierre Beard moved, with a second by Ward 1 Councilwoman Ethel Stewart, to approve selling the bonds. The motion deadlocked, with Stewart, Beard and Jones voting yes and Vice Mayor and Ward 2 Councilman Joseph Mickens, Greene and Ward 6 Councilwoman Jacqueline DiCicco voting no.
“I was not expecting this,” Gaskin said, visibly torn.
Beard voiced his confusion.
“We’re split, and I’m really having a hard time understanding,” Beard said. “… I can’t tell people how to vote, but it’s becoming real theatrical in some of the decisions you guys are starting to make.”
Gaskin cast his vote against, defeating the bond.
“I want to move forward with refurbishing Propst Park,” Gaskin said. “But when I look at the overall financial shape of the city and the fact that we need new roofs on buildings I’m going to have to vote no.”
The municipal complex — which houses Columbus Police Department and municipal court — needs a new roof, as does the adjacent city-owned strip mall. The cost estimate for those projects is over $1 million.
Gaskin also said he wanted to wait for a proposed parks study to be completed. The city and county are seeking a federal United States Department of Agriculture grant that would fund a holistic study of recreation in Lowndes County, identifying needs and areas of overlap.
After the meeting, Mickens — who has historically voted in favor of the Propst Park revitalization — told The Dispatch he didn’t think he had enough information to vote yes.
“I want to get the (FY 2021 audit) back,” Mickens said. “I need to know if we talked to any bankers in the area (about the bonds). I know nobody else applied, but I want to know did we go and talk to Cadence Bank, Bank of Vernon. Those questions haven’t been answered.”
Gaskin said he would work going forward to try to identify grants and private funding sources for work at Propst Park beyond the city’s tourism tax revenue.
He said the decision whether or not to rebid the bonds would be up to the council.
Brian Jones is the local government reporter for Columbus and Lowndes County.
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 41 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 41 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
Join the Discussion