Various improvement projects planned in the Oxford Downtown Development Authority district could lead to the village borrowing up to $1.5 million, but officials don’t feel the entire amount will be needed.
‘I don’t think it’s anybody’s intent on the DDA to use the full amount,? said village President Chris Bishop, who serves on the downtown board.
‘It is possible to do it, but it’s certainly not practical by any means,? noted DDA Chairman Mark Young, who later told this reporter he ‘can’t emphasize enough? that the board will ‘most likely? not borrow the full amount.
Last week, the village council voted 4-1 to approve a bond resolution and publish a notice of intention (see notice on page 26) to issue capital improvement bonds in an amount not to exceed $1.5 million.
Exactly how much money the DDA is going to need and how much it can afford to repay has yet to be determined, but Young assured council the board’s working diligently on coming up with those numbers.
‘We want to be very prudent on how much we’re going to borrow,? he said.
The money would be used for improvement and expansion of downtown’s northwest and southwest parking lots this year, extending the downtown street lighting along S. Washington St. to the Oxford Marketplace shopping center, acquiring the house and property located at 21 Dennison St. and various other parking lot and street improvements.
Downtown’s southwest lot is expected to gain 38 parking spaces, while the northwest lot will gain 65 spaces, plus have drainage and ingress/egress problems fixed.
As for the potential property acquisition of 21 Dennison St., which abuts the southwest lot, Young said he can’t discuss the details because they’re part of closed session meetings.
However, he did say the DDA made an offer and it was rejected. The board hasn’t determined whether another will be made.
By publishing the notice of intent in this issue of the Leader, village residents now have 45 days to petition for a referendum on question of issuing the bonds.
In order to have a referendum election, a petition signed by not less 10 percent of the village’s approximately 2,356 registered voters must be submitted to the village clerk by Saturday, June 14.
If no such petition is filed, the bond sale would proceed during June with the closing in early July, according to village Manager Joe Young.
According to the projected debt service schedule the bonds would be paid off by 2028. If the full $1.5 million was issued, the DDA would have to pay off that amount plus $804,225 in interest.
Combined with the $851,607 in bonds the village issued for DDA projects back in 2005 and the authority’s grand total debt service on principal and interest would equal $3,155,832 between 2009 and 2028.
Councilman Tom Benner, who voted against the bond resolution, expressed serious reservations about the DDA being able to borrow up to $1.5 million.
‘In my opinion, you’re more apt to take the whole $1.5 million,? he said.
Benner said he’s ‘not comfortable? approving this amount when the DDA doesn’t yet know how much it really needs and there are no final numbers available. ‘I’d rather see more ducks in row,? he said.
With the northeast parking lot issue coming up in May, Benner’s concerned the village ‘could end up owing a lot of money.?
Last summer, via a consent judgement, the village took ownership of a large portion of the northeast parking lot previously owned by the Knauf family.
On May 15, a three-member independent panel evaluating the case will make a recommendation as to how much the village should pay the Knaufs for the property.
So far the Knaufs have already been paid the $170,000 that the village and DDA had previously set aside in escrow when the legal battle began.
After the panel’s recommendation is made, the village and Knaufs have 28 days to accept it. If they don’t, the case will proceed to a jury trial in July.
Benner suggested the DDA do some ‘aggressive? work to sell the three vacant parcels it owns on E. Burdick St., both east and west of Mill St.
That land could earn the DDA $600,000 to $700,000 in his opinion, which would give the entity more money to spend and less to borrow.
‘There’s a lot of people on the DDA that want those parcels sold,? Bishop said.
According to Young, the property’s being appraised and the DDA is expected to set a sale price at its May meeting. After that, it will be listed on the market.
Bishop stressed that approving the notice of intent for publication is ‘by no means? issuing the bonds.
The village president noted that many people on the DDA were ‘uncomfortable? with the $1.5 million figure.
‘It was the advice of the bond counsel to not ask for just what you need,? Bishop said.
This was so if the projects are estimated to cost $1.2 million and they end up being slightly more, say $1.3 million, the DDA can readily borrow what’s needed without scrapping any projects and starting the process over again.
Councilwoman Teri Stiles agreed with everything the DDA was planning to spend this bond money on with the exception of the acquisition of 21 Dennison St.
‘I’m not understanding why that needs to be a priority right now when there’s so much undone,? she said.
‘I would agree with that and that’s something the board is going to be wrestling with at the next meeting,? replied Mark Young.
‘The property purchase is just a concept,? said Bishop, noting he couldn’t say much about it because it’s been discussed in closed session. ‘Nobody’s said that it’s gonna happen.?
Overall, Bishop defended the DDA’s actions and amount of progress concerning the improvements to be paid for with the bond money.
‘I can assure you that the DDA is researching this and they’re struggling with it much more than we are,? he said. ? I think we should allow them to advertise for these bonds and keep their work and their progress plans going.?
Before the bonds are issued, an interlocal agreement between the village and DDA must be approved. In this agreement, the DDA would pledge its captured tax revenues toward repayment of the bond debt, although the village is technically the entity borrowing the money.
If council is displeased with the DDA’s progress or final numbers before the bonds are issued, it can reject the agreement and stop the whole process.
‘If we don’t want this to be issued, all we have to do is not come to an interlocal agreement and that’s real easy ? we just don’t vote for it,? Bishop said.
‘The stops are still in your hands if you want it to be that way,? noted Mark Young.