$37.6M Bond Ceiling Approved
OCEAN CITY – The Mayor and City Council voted to approve an ordinance on final reading to authorize the issue and sale of General Obligation Municipal Purpose and Refunding Bonds not to exceed $37.6 million.
Finance Administrator Martha Bennett explained that during work session discussions the refunding of 2005 bonds was discussed and the town’s project list was reviewed. The refunding amount of the bond issue is $14,630,000.
“The original estimate that I gave you was just for the refunding of the 2005 bonds,” she said. “That is one part to the bond issue to refinance the 2005 bonds.”
The town’s project list was presented, which included previously approved projects such as the reconstruction of the Boardwalk. The Mayor and City Council were also presented with other much needed projects to consider including in the bond issue.
By second reading, the project list grew to include the Boardwalk reconstruction for $6.1 million, Caroline Street Comfort Station for about $1 million, Caine Woods, Old Landing and 28th Street Pumping Stations all for almost $1 million each, the Clarigester Upgrade for about $1.3 million, Winter Influent Pump Upgrades at about $400,000, St. Louis Avenue Sewer Main for $442,000, St. Louis Avenue Street Improvements for about $4.5 million, land purchases at $1.2 million and fire station improvements around $5 million. The total amount in projects is $22,958,000.
“This is a ceiling,” Bennett said. “What happens is as it is structured for the refunding it does depend on interest rates, and this is an authorization at a ceiling. You estimate depending on what happens with interest rates between now and the date of the sale.”Councilman Brent Ashley disagreed in creating more debt for the city.
“There is some very worthy projects on here … but for me sometimes I think there is a definite disconnects between politicians and bonds,” he said.
Council President Jim Hall agreed with Ashley but asserted the town has to stop delaying capital projects.
“At some point, we have to step up and do something and unfortunately for us they are big expenditures, they are not cheap projects,” he said.Councilman Joe Hall pointed out that the ordinance represented a ceiling for borrowing.
“It is a cap so between now and when we go to borrow the money we find one of these things can be paid for as we go or in a different manner we can make that adjustment, but I don’t foresee that,” he said.