OKTIBBEHA COUNTY — Supervisors are pondering a bond issue to pay for a wishlist of road department equipment.
Based on projections compiled by Government Consultants Inc., the county could borrow up to $7.5 million as soon as this year.
That would more than cover Road Manager Victor Collins’ equipment needs. Two weeks ago, Collins informed the board his department needs to replace aging equipment to keep up with growing demand. His list includes motor graders, street sweepers, a chip machine and new trucks.
He estimates a cost of $3 million if all his needs are met.
Supervisors on Monday discussed the county’s bond capacity, but took no action.
Another work session is scheduled for 3:30 p.m. Tuesday and will specify what supervisors want to buy and how they will pay for it.
“It’s just that we’ve got so much we want to do, and of course, we’re limited on what we can do,” District 2 Supervisor Orlando Trainer told The Dispatch this week.
Based on the projections, the county currently carries about $38 million in debt. That is 7.69% of the county’s 2022 assessed valuation of $497 million. That percentage is a little more than half the county’s legal debt limit of 15%. In this year’s budget, the board pays about $4.3 million a year on outstanding debt.
In order to issue a $7.5 million bond this year, Government Consultant’s projections assume the county’s valuation will continue to increase 1.6% each year. It also assumes the county chooses to reallocate or increase its property tax rate by 0.6 mills to keep pace with its debt payments. One mill generates $467,000 for the county, Trainer said. A 0.6-mill increase in the tax rate would cost the average homeowner an additional $6 per every $100,000 of property value.
Another projection, Trainer said, assumes no growth and no millage reallocation or increase. In that case, it will be several years before the board could issue a $7.5 million bond, Trainer said.
Multiple options available
District 3 Supervisor Marvell Howard, who serves as the board’s president, said his focus is not just on road equipment but any project that supervisors want to consider.
“I want to look all around the county and see what the needs are,” he said. “… At this particular point, I’m open to all the options out there. I just want us to make sure we lay everything on the table and explore our options before we make decisions.”
And while a bond is on the table, supervisors will discuss applying for small loans or cash purchases, Howard said.
District 1 Supervisor Ben Carver said he is taking a “needs-based approach” on how big the discussed bond issue should be.
“I’m going to identify a need and see how much it costs and not just go spend the money on something,” he said. “… (The bond) could be $5.5 million. It could be $2 million. I think we need to identify where our greatest needs are in the county, how much it’s going to cost to do it and a (measure) of the board to see if they want to spend that kind of money.”
Carver acknowledged the road department’s needs are “critical.”
Trainer said he favors purchasing the needed equipment. He said the county could pay for some equipment from its general fund or apply for a small bank note.
A bond issue, he said, should be saved for another project.
“We’ll get a good product that will last this county for years and years to come,” Trainer said. “If you’re making those kinds of (road equipment) purchases, that’s going to improve efficiency. … I do know that (Collins) has done his due diligence, and he’s saying that with these pieces of equipment, it will enhance the county’s capability tremendously.”
Kevin Edwards is news editor and reports on Starkville and Oktibbeha County government.
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