Council adopts declaration of intent to preserve reimbursement options for Westminster Water Reuse Project

The Mayor and Common Council adopted Resolution/Ordinance 26‑07, a declaration of official intent concerning the Westminster Water Reuse Project that preserves the city’s option to reimburse qualifying project expenditures from proceeds of future borrowing.

Staff reported that the Maryland Water Infrastructure Financing Administration (MWIFA) has ranked the project sufficiently on its intended use plan to make loan funding available. Staff described expected financing components: approximately $9,000,000 in tax‑exempt general obligation bond proceeds and $7,000,000 in taxable general obligation bond proceeds that include a principal‑forgiveness structure. Staff said the $9,000,000 tax‑exempt component may carry an estimated interest rate in the range of 1.12% at closing (staff stressed rates are subject to change at issuance).

City staff explained a federal tax‑code rule requiring at least $51,000 of qualifying project expenditures be paid prior to closing for a reimbursable tax‑exempt drawdown; the declaration of intent preserves the city’s ability to reimburse qualifying expenditures paid no earlier than 60 days before the resolution's effective date. Staff emphasized the declaration does not itself authorize issuance of bonds; those actions will come later through separate ordinances and resolutions that fix loan details.

Council asked clarifying questions about the two bond components and principal forgiveness mechanics; staff answered, thanked Maryland Department of the Environment staff for assistance, and the council adopted the declaration by voice vote.