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Warren auditor wants to refinance

Plan would replace bonds, save money

WARREN — City Auditor Vince Flask asked council’s finance committee to consider allowing him to sell a new bond to replace three existing bonds sold in 2013 for $8.59 million.

Proceeds for the three bonds, sold for $2.16 million, $3.96 million and $2.44 million, were used for a building acquisition project, renovating various city-owned buildings and making street improvements.

Not all of the projects from the initial bond offering have been completed. While the street resurfacing has been done, building renovations and upgrades have not been completed.

To refund the three existing bonds, the city would sell a new bond.

“Rates have dropped dramatically since we sold the original bonds in December 2013,” Flask said. “We have an opportunity to achieve savings over the life of the bond that can range between $300,000 to $350,000, depending on the rate.”

The original 20 year bonds were scheduled to be paid off in 2033. The term would remain the same.

Flask made a presentation to the finance committee to prepare its members before asking the full council to pass an ordinance. He expects to present the bond ordinance during council’s June 28 meeting and place it into first reading.

Councilman Dan Sferra, D-at large, however, told the auditor to seek emergency passage instead, so he can seek the best possible rate.

“Doing this is like a homeowner refinancing his home to get a better rate and save thousands in mortgage interest,” Sferra said. “No one should have a problem with this. This is a no brainer.”

Eddie Colbert, D-at large, chairman of the finance committee, told members that general fund revenues are about where the city expected them to be.

“So far, we’ve collected about $11,094,124 in revenues and have had expenses of $10,417,960,” Colbert said.

The city, so far, is about $1 million ahead in revenues than it was at this time in 2016.

“Every year, the city attempts to spend less than it took in the year prior,” Colbert said. “So far, it has done that.”

However, he warned, there will be a shift in spending as the city hires more police officers and firefighters and begins to do the road resurfacing work promised in last year’s 0.5 percent income tax increase.

Mayor Doug Franklin said starting next month the city’s street resurfacing projects will become increasingly aggressive.

“It will be a problem for some, but the work will be a sign of progress,” he said.

rsmith@tribtoday.com

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