By Ben Rodgers
HOBART – The Hobart village board approved a series of bond resolutions to look for low-interest rates for various upcoming projects at its Tuesday, May 19, meeting.
The proposed 2020 borrowing resolutions include four components, presented to the board by PMA Securities.
The first is a water loop extension in Centennial Centre with an estimated cost of $600,000.
The project is located within half a mile of Tax Incremental District (TID) No. 1 and will generate no tax increment.
It will be paid back with TID No. 1 revenues.
This project has already been bid out.
The second is Blackberry Ridge subdivision with an estimated cost of $1.3 million.
Twenty percent is located within half a mile of TID No. 1, so 20 percent of the cost, or $260,000, will be repaid from the TID.
Of the remainder, $375,000 will come out of the tax levy, $125,000 will come from the stormwater fund and $540,000 will be repaid by lot assessments from the developer.
The final plat for this project still has to be approved by the Planning and Zoning Commission and the full board.
The third is infrastructure for the Southwind Estates subdivision, with an estimated cost of $1.65 million.
This project is located within a half mile of TID No.2 and will be repaid with TID No. 2 revenues.
A bridge project to connect the development with an existing subdivision was previously approved, and the second part, a $1.1 million bid for utility and street construction, was later approved at the Tuesday meeting.
The final component is refinancing $885,000 of taxable bonds from 2010.
Village Administrator Aaron Kramer said he wanted to start these borrowing projects when interest rates dipped to near zero with the onset of the pandemic, but the bond market was saturated with sellers of municipal bonds, not buyers.
“I’m much more optimistic than I was two months ago, and it’s nothing anybody here in Hobart could do to benefit from this,” he said. “We just had to wait for it to thaw out, for the stars to align again.”
The board will not know how much will be saved with this combination of bonds until the lowest overall bid is accepted at the June 23 meeting, but there is an estimate, he said.
“The current estimate is this will save the village, after all the expenses, $50,000,” said Brian Della, director of public finance for PMA Securities. “Remember there are two components, refinancing and new money. So refinancing is really beneficial because you’re saving money, but it’s also covering all the costs for the (bond) issues. There’s no reason not to do it.”
Kramer said he is hoping for a stable next five weeks, otherwise the hodgepodge of bonding may not continue.
“This is just saying go forward, presuming the plan is executed as presented,” he said. “If something crazy happened, we would just adjust the plan and not do the refinancing situation.”
The board unanimously approved five separate bond resolutions to not exceed costs, one for $385,000 in general obligation bonds for street improvements, another for $125,000 in general obligation bonds for storm sewer projects, a third for $2.47 million in general obligation bonds for projects in tax incremental financing districts, the fourth for $2.98 million for the sale of general obligation corporate purpose bonds and the final for the sale of $1.2 million in taxable general obligation promissory notes.
Board president Rich Heidel and trustee Tim Carpenter were absent.
In other news, the board heard an update from Jerry Lancelle, public works director, on the results from the annual televising of sanitary sewer lines.
Lancelle reported three cracks in the lines, one severe enough it needed to be repaired immediately.
He also reported seven manholes are leaking water into the system.
Lancelle said the combined rate at which the infiltration is leaking into the sanitary system is bringing in up to 15 million gallons of water a year, adding unnecessary costs in treatment and capacity loading of sanitary pipes.
He said the combined cost of repairs is estimated to be $13,000-$15,000 and will come from the sanitary sewer fund.
Kramer also reported on a major project with NEW Water, or the Green Bay Metropolitan Sewerage District, with the Dutchman Creek interceptor pipe.
Hobart’s share of the cost could be as high as $981,000, which would be paid for by customers, but Kramer said a previous project is anticipated to come off the books and this new one could slide in to potentially avoid increased costs.
He said more information will be presented at the next village board meeting.