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Monday, May 2, 2016

Council OKs $945,000 loan refinancing agreements

Friday, May 15, 2009

Also reviews County offer if new jail bond issue passes

The Cherokee City Council conducted Public Hearings Tuesday night on the authorization to restructure two loan agreements to evidence the obligation of the City in regards to spreading the costs with the intent of lowering the City's total principal and interest payments in the next fiscal year.

The procedure enables the City to go through the legal steps to refinance an existing 2002 bond issue for $710,000, and to provide long-term financing for that part of the Bacon Aquatic Center project yet to be raised by the on-going fund drive, totaling $235,000. The issuing of new bonds for the Bacon Aquatic Center is to provide a long-term solution for the fund drive deficit, should additional pledges for the new City pool not be successful in the next two years.

With the support of the City's Bond Agent and the Council, the two amounts are being consolidated into one new 2009 issue. In the process, the Council passed a resolution calling for the issuance of General Obligation Capitol Loan Notes totaling $945,000.

City Administrator Don Eikmeier advised the Council that the action will save the City an estimated $11,300 in long-term financing.

The original $710,000 2002 G.O. Bond was for City infrastructure improvements, including West Cedar Street, the downtown alleys, and Cherokee Fire & Rescue's aerial fire truck.

In other action, the Council also approved the City's restructured hotel/motel tax business incentive program, with the City maintaining the existing grant program, and the Cherokee Industrial Corporation (CIC) maintaining the loan program.

Eikmeier and Mayor Pam Pierce previously met with the CIC to review final revisions to the program, whose major focus is storefront restoration only for buildings in the City's Central Business District as defined by the Zoning Ordinance. Applicants must match 60-percent to the City's 40-percent, with 20-percent of that obligation to the CIC.

The size of the grants is not to exceed $5,000, with a maximum grant limit in fiscal year 2009-2010 proposed at $12,500, including $10,000 City funds, and $2,500 CIC funding.

Use of the funds is restricted to structural improvements that maintain or restore the historical integrity of the building. Signs and awnings are not eligible unless they are part of a comprehensive restoration project. Competitive quotes from at least two vendors are required, with preference to bids from Cherokee vendors if that bid is competitive.

Subject to voters approving a $3.3 million bond issue on August 4 for a new County Jail, Sheriff's Office, Communications Center, and Emergency Operations Center, the Cherokee County Board of Supervisors is offering the City the office space currently occupied by the Sheriff's Department. The offer does not include the present jail space, which the County wishes to retain for storage.

The County is offering the space in the current Law Enforcement Center to the City for $1 per year lease. The LEC's heating/cooling plant will be totally replaced this summer with a high efficiency system, and the County will remain as owner responsible for structural, mechanical, and plumbing improvements. As tenant, the City will be responsible for annual operating costs such as furnishings, utilities, etc. The City's share of utilities will be proportionate to the square footage to be occupied by the City.

If voters do not approve the bond issue on August 4, the current LEC agreement will remain intact. If the voters approve the bond issue, the CIty will draft a new cost sharing agreement with the County.

In other business, the Council reviewed the Cherokee Fire & Rescue proposal to apply for a possible Federal Emergency Management Agency (FEMA) Firefighters Assistance Grant in the amount of $367,463 to pay for 95-percent of a new pumper truck to replace the department's current 1967 American LaFrance pumper. The City's 5-percent share would total $18,373.

If the grant should be successful, the preparation of specifications, bidding, and building the pumper would extend delivery time to the 2010-2011 fiscal year, when the City would need to budget for its 5-percent share.

The Council also awarded the low bid for resurfacing the River Road in the City limits to Blacktop Service Company in the amount of $233,270. The federal stimulus grant received for the project will pay for $180,000, or 77-percent of the project, with the $53,270 balance to be raised by local funding from local option sales tax revenues designated for street repair. That fund balance as of June 30, 2009, is projected to be $609,000.

The Council also granted a Tax Abatement for First Coop Association in Cherokee to install a new grain dryer at a cost of $440,242 at its facility on the River Road. The Coop is seeking the City's 10-year Tax Abatement that graduates from 80-percent of value in the first year to 20-percent of value in the 10th year.



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