$28M Bond Ordinance Advances

OCEAN CITY – Resort officials this week agreed to advance an ordinance authorizing the sale of $28 million in general obligation bonds to a second reading.

On Monday, the Mayor and Council voted 5-1, with Councilwoman Carol Proctor absent and Council President Matt James opposed, to approve the first reading of an ordinance authorizing the Mayor and Council to sell no more than $28.4 million in general obligation bonds. City Solicitor Heather Stansbury said the sale would allow the town to fund several capital projects in fiscal year 2024.

“This is to authorize the Mayor and City Council to issue and sell general obligation bonds not to exceed $29,410,000 for the water infrastructure projects, Montego Bay street paving, OCPD mixed-use facility, convention center improvements, and the bond issuance costs,” she said.

As proposed, the bond sale will finance a $2.2 million water main upgrade on 94th Street, an $11.25 million clarifier improvement project at Gorman Avenue Water Treatment Plant, and a $2 million chloride system addition at Gorman Avenue Water Treatment Plant, with the debt service of each project to be paid by user fees.

The bond sale will also finance a $4.26 million downtown mixed-use facility for the Ocean City Police Department and a $2.5 million street paving project at Montego Bay. Officials noted that specific project was above and beyond what the town typically allocates for street paving.

“So it doesn’t affect the $2.5 million we are spending on our regular street paving projects,” Mayor Rick Meehan said in a council meeting last week.

The bond sale will also finance $4 million in improvements to the convention center, the debt service of which will be paid for by food tax revenue. City Manager Terry McGean told the council last week that request was nearly $1 million more than he initially requested.

“What it does is include replacing all the carpet on the second floor,” he said.

During last week’s council meeting, Finance Director Chuck Bireley said cost estimates of $28.21 million and bond issuance costs of $200,000 brought the total not-to-exceed cost to $28.41 million. He said that would result in an annual debt service of $2.07 million – $1.12 million for the water department, $292,447 for the convention center, and $655,079 for the general fund.

Back on the agenda for a first reading on Monday, James announced he would not support the ordinance.

“I’m not going to vote against this for all of the projects,” he said. “I just don’t support the mixed-use facility downtown. So I will be voting against it.”

With no further discussion, the council voted 5-1 to approve the first reading of the bond ordinance.

About The Author: Bethany Hooper

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Bethany Hooper has been with The Dispatch since 2016. She currently covers various general stories. Hooper graduated from Stephen Decatur High School in 2012 and the University of Maryland in 2016, where she completed double majors in journalism and economics.