Council begins review of up to $29 million in notes to fund police station; advisory team outlines options

Mount Vernon City Council on Feb. 23 heard a presentation from Andy Burrows of Bradley Payne about financing options for a proposed police station and related facilities. The ordinance on first reading would authorize the issuance of notes in anticipation of bonds in an amount not to exceed $29 million; council will consider a follow-up committee meeting on March 9.

Burrows described typical municipal practice for construction financing: issue one-year notes to obtain cash quickly for construction draws, then convert to long-term fixed-rate bonds later when project costs and market conditions are better known. "The legislation before you tonight would authorize up to $29,000,000," Burrows said, adding that if bids come in lower the city simply would borrow less. He estimated short-term interest in the current market could be "about the 4% range" while noting the one-year note gives flexibility and may be rolled or converted.

Council members pressed on debt capacity, certification of funds when executing contracts, and how investment income on unspent proceeds could offset interest costs. Burrows noted several older bonds are scheduled to roll off in coming years, which helps capacity, and explained that the city's unvoted debt limitations and assessed-valuation limits are relevant to structuring the borrowing.

Council and staff agreed to schedule another committee meeting on March 9 to review a revised draft of the legislation (staff said section 15 referencing an Ohio Market Access Program could be removed) and to bring in outside experts: municipal advisors, bond counsel and the owner's representative to answer specific market and legal questions. No final borrowing decision was taken; the ordinance remains at first reading and staff said additional committee review will precede any vote.