Summit County officials are moving forward with plans to finance a new building project through the issuance of a water revenue bond, as discussed in the County Council meeting on September 27, 2023. The council is seeking authorization to issue this debt due to insufficient funds to continue the project, which has been in development since the county purchased lot 5 of the FJ Gilmore site last year.

The proposed financing will be structured as a direct placement water revenue bond with a local bank, which offers several advantages over traditional market bonds. This approach allows for greater flexibility, including the potential for refinancing if interest rates decrease in the coming years. The total budget for the building is estimated at $18.3 million, which includes contingencies and previously allocated reserves.

The council highlighted the importance of maintaining a strong credit rating, which currently stands at AA with a positive outlook. This rating has improved over the past few years, reflecting the county's financial stability. The anticipated interest rate for the bond is around 5%, a significant increase compared to previous years when rates were much lower.

Officials emphasized the need for careful financial planning, as the district's outstanding debt would increase from $32 million to $50 million with this new bond. Questions were raised about the impact on cash flow and water rates, indicating that the council is considering the long-term implications of this financing decision.

As the project progresses, the council expects to refine budget estimates and monitor the use of contingency funds. The building is not scheduled for completion until 2025, and the council is committed to ensuring that the financing structure remains adaptable to changing economic conditions. This proactive approach aims to secure the necessary resources while minimizing financial strain on the community.