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Assembly advances $3.5M school bond in first reading; authorizes loan application for pump station replacement
Summary
The Petersburg Borough Assembly gave unanimous first-reading approval to an ordinance allowing up to $3.5 million in general obligation bonds for school capital improvements and unanimously authorized the borough manager to apply for an Alaska Department of Environmental Conservation loan to replace Pump Station 3.
The Petersburg Borough Assembly on Nov. 16, 2024, unanimously passed the first reading of Ordinance 2024-24, authorizing general obligation bonds in a principal amount not to exceed $3,500,000 to fund public school capital improvements, and unanimously approved Resolution 2024-19 authorizing the borough manager to apply to the Alaska Department of Environmental Conservation (ADEC) for a Clean Water Fund loan for the Pump Station 3 replacement project.
The bond ordinance, which the assembly advanced in a first reading, implements a measure previously approved by borough voters at the Oct. 1, 2024, municipal election. Cynthia Cartlidge, the bond counsel appearing by Zoom, told the assembly that a general obligation (GO) bond is the municipality’s highest form of credit because it pledges the full faith and credit of the community to repay debt service; if necessary, taxes would be raised to meet bond payments. “Any available funds of the community are pledged for payment and if those funds are insufficient that you will raise taxes to whatever level is necessary in order to pay debt service on the bonds,” Cartlidge said.
The motion to adopt Ordinance 2024-24 in its first reading was made by Member Linn and seconded by Member Newman. The clerk recorded unanimous aye votes from the members present (Bob; Jay; Mark; Scott; Donna; Rob; James). The ordinance will require two additional readings before final adoption.
On the Pump Station 3 replacement, the assembly voted to authorize the borough manager to execute a loan agreement with ADEC for a Clean Water Fund loan for the project, as provided for by the voter-approved measure. The motion to approve Resolution 2024-19 was made by Member Greager and seconded by Member Newman; the clerk recorded unanimous aye votes from members present (Mark; Jay; Rob; Scott; Donna; James; Bob). The resolution enables borough staff to pursue the loan application and, if successful, negotiate the loan agreement, but does not itself obligate funds beyond the application and authorization steps.
Why it matters: The bond ordinance, if adopted after subsequent readings, would allow the borough to issue GO bonds to pay for school capital work voters approved in October. The ADEC loan authorization opens the formal application path for replacing Pump Station 3 — a project on the borough’s capital list that the assembly and staff discussed during the meeting.
Next steps: Ordinance 2024-24 will return to the assembly for second and third readings before any bond sale. The borough manager may proceed with an ADEC loan application for Pump Station 3; any finalized loan agreement would return to the assembly for execution and any required fiscal approvals.
