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Council introduces amendment to allow surety instead of escrow for sewage revenue bond
Summary
At its June 16 meeting, the Franklin City Council heard introduction of an ordinance that would let the city use a surety bond rather than escrowing about $3.9 million required under its existing sewage works revenue bond ordinance; the item was introduced for public hearing at a future meeting.
FRANKLIN — The Franklin City Council on June 16 introduced an ordinance to amend the city’s sewage works revenue bond rules to allow purchase of a surety bond in place of escrowing roughly $3,900,000 tied to the sewer plant improvements.
City Attorney Lynn Gray told the council the change would not alter the bond’s term or principal but would add an option to secure the debt with a surety policy rather than setting aside an escrowed account. "You have to escrow a certain percentage of that money throughout the entire 20 years of the bond to make sure that the city never misses any payments,"…
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