OCEAN CITY – Officials agreed this week to adopt a $28 million bond ordinance.
On Monday, the Mayor and Council voted 5-1, with Councilwoman Carol Proctor absent and Council President Matt James opposed, to approve the second reading of an ordinance authorizing the Mayor and Council to sell no more than $28 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 $28,410,000 for water infrastructure projects, Montego Bay street paving, OCPD mixed-use facility, convention center improvements and 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 earlier this month.
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 earlier this month that the 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 at the time.
During a council meeting earlier this month, 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 Monday, the council voted 5-1 to adopt the bond ordinance on second reading.
James has indicated he would not support the bond issuance, as he did not support plans for an Ocean City Police Department mixed-use facility downtown.
