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Council approves short‑term bond anticipation note to bridge DWSRF loan timing; Machias Savings Bank selected
Summary
Facing unpaid bills on the Surrey Road water main project while the Drinking Water State Revolving Fund (DWSRF) loan was still pending, the council authorized awarding a bond anticipation note to Machias Savings Bank at 5.35% on an as‑needed basis to bridge cash‑flow timing until the state loan is completed.
The finance director, Nate Moore, told the council on June 16 that the long‑anticipated Drinking Water State Revolving Fund (DWSRF) loan paperwork had not been fully executed and the city faced near‑term vendor invoices for the Surrey Road water main project. Moore presented five local bank quotes and recommended Machias Savings Bank’s offer at 5.35% for an as‑needed bond anticipation note (BAN) to cover short‑term cash needs until the DWSRF loan is completed.
Council approved the award unanimously. Moore said the municipal bond bank and DWSRF loan approval are expected in August and that once the state loan is executed the city would use those funds to pay down the BAN. He estimated the interim interest cost would be modest for a short bridge (staff cited about two‑week to 60‑day timing after an August approval), but councilors discussed raising the BAN cap if requisitions exceed initial estimates.
Why it matters: The BAN will allow the city to keep the Surrey Road water project moving and pay current invoices without interrupting contractor work while final state loan documents are completed.
Next steps: Council awarded the BAN to Machias Savings Bank at 5.35% on an as‑needed basis; staff will monitor requisitions and return to council if additional short‑term borrowing is required.
