Tuesday, October 7, 2008 9:48 PM CDT
Mayor: Bond issue speeds up projects, avoids higher costs
By HERB MEEKER, Staff Writer hmeeker@jg-tc.com
MATTOON — Not borrowing money through general obligation bonds could push back public works projects, like south side flood control, by several years, city officials said Tuesday night.
Mattoon city commissioners on Tuesday unanimously approved seeking $10 million through bonds next month to help fund several city infrastructure projects, including new sidewalks, additional parking lots, recreational facilities, and a new public works building in addition to the south side drainage project for flood control in the Kickapoo Creek watershed, and renovations of the Cross County Mall.
The bonds, split in two series — one for $6 million for the multiple public works projects and $4 million for the mall redevelopment — will be paid off through sales taxes, including the ½ percent tax dedicated to infrastructure projects, and the new 1 percent sales tax added to retail sales since July 1 in the new Broadway Avenue East business district.
“Part of this is to do it now,” said Mayor Dave Cline during a public hearing on the bond issue. “If we wait longer we would pay more in costs.”
The public works efforts will cost more than $6 million, said Treasurer Preston Owen. For example, the cost estimate for the south side drainage Phase I work is $3 million. The new public works building plans have an estimated cost of $3 million, counting land acquisition.
“If we had to save up all the money we needed for the drainage project, we would have to wait another five years. This way we get the money now,” said Owen.
Some savings from the sales tax kicker has paid for the land acquisition already for building a water detention pond and drainage ditch near South Ninth Street and Old State Road, he added.
Planned Roundhouse Sports Complex improvements — including a new walking and running trail, new athletic fields, a skate park and expanded parking — would cost the city $400,000, which matches a state recreational land use grant. Creating a system of improved sidewalk routes, referred to as arterial walking routes, throughout the city has an estimated cost of $750,000.
The city would also partner with the YMCA to create new public parking after that recreational facility expands in the near future through its own fundraising efforts. The estimated cost for the parking for the city’s midtown would be $400,000.
Owen said the city does collect $1.2 million annually from the sales tax kicker approved by a citywide referendum five years ago. Half of that amount is used for infrastructure improvements, while the rest goes to the city general fund to provide some property tax relief.
Will the city generate enough revenue with the new 1 percent business district tax covering mall businesses as well as other retailers along much of the Broadway Avenue East corridor? It was announced Tuesday the business district sales tax there produced $24,300 during July, which averages out to $291,600 per year.
The hope is that amount of tax revenue would increase with improvements to Cross County Mall and the filling of empty retail spaces in the facility. Work on that project, which has a commitment of $500,000 from the mall owners, is expected to start next year, Owen said.
The city had set a goal of interest rates at 4 to 4.5 percent on the bond issues prior to the financial markets meltdown, Owen said. The sale is scheduled for Nov. 18, mainly due to the volatility of the financial markets.
“We do intend to issue the bonds on Nov. 18. We must spend the money within three years,” Owen said during the hearing, which drew questions only from city council members and the news media.
City residents do have the option to protest the bond issue within 30 days. It involves a petitioning process to create a public referendum early next year. Questions on a protest can be addressed to Mattoon City Hall or explained through a public notice this month in the newspaper.
Owen said he is not aware of any referendum held to fight this type of bond issue by the city. He said the bond issue is based on payments from revenues already received from the city through sales taxes. It does not depend on property taxes.
In other business, the council received only a few questions on the upcoming leaf collection program that requires residents to use 30-gallon recyclable paper yard waste bags for curbside collection by city crews. The program has eliminated the use of aging leaf vacuum units, which were sold at city auction earlier this summer.
During the discussion in the caucus room, one questioner asked if diseased plants could be burned by serious gardeners concerned with contaminating a mulch supply. Mattoon Fire Chief Mike Chism said that limited burning could be completed in fire pits as long as they do not turn into leaf-burning pits. Leaf burning has been prohibited for many years in Mattoon.
The leaf collection officially starts next week with city crews collecting leaves weekly on a rotating basis for each section of the town, Mattoon Public Works Director Dave Wortman said. He said residents can haul leaves and other yard waste to the yard waste facility this fall also. The hours are now 10 a.m. to 6 p.m. daily, but those hours will be adjusted after the time change this fall, he said.
Contact Herb Meeker at hmeeker@jg-tc.com or 238-6869.
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Mike P wrote on Oct 8, 2008 9:25 AM:
Common sense seems lacking so lets throw some at this and see if it sticks. What kind of accountant, takes tax numbers from a new district, for one months revenue increase, multiplies it by 12, and uses that as hard data stating it is sure to increase?
The economy is deflating. Besides its not a good time, to do these extra curricular investments, they spent the money they had in hand, that could have paid for already needed work geting done. They bought a million dollar magic bean field instead. Some genious of an engineer, thinks a several million dollar ditch and hole is going to keep flooding down. What happens when it attracts geese, the pond gets drained and it falls into disrepair and gets sold to a buddy for a huge loss. Its only tax dollars. Drainage is complex enineering, I am sure between the lot of the talking heads, they aren't up to discussing complex issues, without crib notes, and some coaching.
Get the petition moving. Figure out how to put pink slipping some folks, on a seperate one and lets get both issues on the same ballot. "