Committee approves three appropriations of unexpended bond proceeds including $2.86M Canal Street release
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Summary
The Committee on Administration and Finance voted to recommend three appropriations of unexpended bond proceeds, including a $2,861,344.99 repurposing of Canal Street proceeds, to reduce borrowing and fund current capital projects.
The Committee on Administration and Finance voted Tuesday to recommend three separate orders to appropriate unexpended bond proceeds and repurpose them for active projects.
The three appropriations recommended to the full council are:
- $50,000 appropriation of unexpended funds to pay costs incidental to CIP projects (including payment related to recreational golf cart paths and Mansfield Field renovation items and kiosk costs).
- $91,236.71 appropriation of unexpended funds relative to First Swampscott Road intersection improvements (project complete; proceeds to be applied to CRP24 road projects).
- $2,861,344.99 appropriation of unexpended funds from a 2013 Canal Street utility authorization. Finance Director Anna Friedman explained that bond counsel advised the language and release because these older proceeds have a statutory requirement to be expended or repurposed; she noted repurposing the proceeds does not prevent new future authorizations for related projects.
Why it matters: Reallocating unspent bond proceeds reduces year-end borrowing needs, lowers the amount of new debt the city must issue and can free funds for current capital needs without raising taxes.
Committee discussion and action
Finance Director Anna Friedman told the committee the Canal Street authorization dates from February 2013 and that, after consultation with bond counsel, the city must clear and repurpose proceeds that have remained unspent beyond the period bond counsel advises. "The specific language is drafted, is required to indicate that the project is now complete in order for those proceeds to be released and repurposed," Friedman said. She added repurposing the proceeds does not preclude future related capital authorizations.
Each appropriation was moved in committee by Councilor Stott, seconded as noted in the record, and carried by committee vote. The orders will appear on the full council docket for final approval.
