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Council passes $5M bond issue

 

Columbus resident Spencer Smith voices concerns over a bond issue intended for Columbus infrastructure repairs. The motion for the bond issue passed.

Columbus resident Spencer Smith voices concerns over a bond issue intended for Columbus infrastructure repairs. The motion for the bond issue passed. Photo by: Luisa Porter/Dispatch Staff

 

The following related files and links are available.

 

PDF file File: Infrastructure survey for Columbus.

Nathan Gregory

 

Columbus councilmen voted Tuesday in favor of issuing a $5 million bond to finance capital improvements. 

 

With the issue comes a 1.1 mill property tax increase, which will be used to help pay off the bond over 15 years. The vote was 5-1 with councilman Bill Gavin the lone opponent. The decision will be made official June 17 when the council votes to approve the minutes for Tuesday's meeting. 

 

At the request of councilman Kabir Karriem, the council will hold a workshop to prioritize projects on the infrastructure survey compiled by city project managing and engineering consultants. Councilmen will also determine whether the money will be split evenly among the city's six wards, or used to address the most critical needs citywide. 

 

City legal, engineering and project managing fees will amount to roughly $500,000, leaving $4.5 million for actual infrastructure work. 

 

Before councilmen voted, Columbus resident Spencer Smith addressed them. He said one of his concerns was the added expense of interest over a 15-year period. Councilman Charlie Box said the only way the city could finance road paving, ditch work and sidewalk improvements was through taxes and bonds. 

 

"We're going to pass the bond and sell bonds, which are going to be very cheap right now, or we're going to raise taxes," Box said. 

 

"Or you're going to do both, which is what you're doing," Smith replied. 

 

"You're raising one to pay the other off," Box said. "The alternative would be to raise taxes three or four mills to come up with enough capital to do basically the same thing." 

 

Bond counsel Steve Edds reminded councilmen that Columbus was among the lowest in the state in terms of outstanding debt compared to what the city could issue based on its assessed valuation. 

 

Smith suggested implementing a yearly capital improvements list that the city could pay for out of its general fund.  

 

"We wish we could get to a situation where we could pay for everything as we go," Box replied, "but I don't know of a city in this state that does that." 

 

Smith referred to a Dispatch article in which city project managing firm J5 Broaddus found roughly $1 million in waste in a study of the city's public works department and said the idea of wasted taxpayer dollars coupled with increasing debt and taxes made him uneasy. 

 

"It's hard to be very comfortable with having waste, debt and an increase in taxes," Smith said. "It seems that efficiency in some places may allow us to do a little more pay-as-you-go and pay-as-you-go would save us some money. Even though the interest rates are very low, it's not free. It's an added expense." 

 

After the meeting, Gavin said he was not against the bond issue itself. Rather, he thought 15 years was too long a financing plan and couldn't vote for it without establishing how the money would be allocated. 

 

"I think borrowing $5 million over a period of 15 years is a little bit too long," Gavin said. "I'd rather see us borrow the money for 10. The financing is accruing too much interest over too long a time. I think the majority of those roads 15 years from now will need paving again and we'll be right back here. Some of these roads will probably already be deteriorated by the time we're done paying." 

 

Councilmen have not set a date for the workshop.

 

Nathan Gregory covers city and county government for The Dispatch.

 

 

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