County Delays Action on School Bond Refinancing
Moore County is looking for more information before refinancing the school bonds issued in 2003.
At a Tuesday meeting, the board of commissioners delayed a decision on a recommendation that the bonds be refinanced to take advantage of today’s much lower interest rates. Instead, the board asked the staff to pursue further research on the issue.
“We don’t have the numbers yet,” Commissioner Tim Lea said.
Chairman Nick Picerno said he wanted to know how quickly the board needs to make a decision and noted that interest rates might go even lower.
“This has not been debated,” Picerno said. “We’re talking about too much money.”
Their debate followed a presentation by personnel from Davenport & Co., a consulting firm that advises the county on financial issues.
However, Lea asked if it would be wise to apply the county’s existing capital reserve fund toward the interest due on the remaining bonds, thus lowering the county’s overall debt.
The county has accumulated a reserve fund of about $7 million, set aside to assist with the financing of future capital needs, such as a new courts facility and a government office building.
The capital reserve fund was built up through allocations in recent years from the unappropriated fund balance, the amount based on sums exceeding a percentage designated by the board.
But Commissioner Larry Caddell pointed out that the reserve fund was established to provide a “pay-as-you-go” process to ease the financing of future capital project.
If the fund is applied to the 2003 bonded indebtedness, the money will not be available for future projects.
Records show that the county owes $8.3 million on the bonds issued in 2003.
The proposed refunding would apply to general obligation bonds approved by voters in previous referendums.
Chief Financial Officer Carrie H. Neal advised the commissioners that under the Local Government Bond Act, local governments may qualify to refinance these bonds at a lower interest rate.
Such a refunding would be subject to final approval by the Local Government Commission, and the county would be under no obligation to accept the new funding if the bids do not meet the criteria.
In other business during the Tuesday meeting, the commissioners approved a change order on a Pinehurst water tank project to assess $37,000 in damages for late completion of the project.
The assessment is directed to CB&I Constructors, which was awarded a $1,227,000 contract to build an elevated storage tank on Monticello Road.
Michael Apke, project manager for the McGill Associates engineering firm, recommended a time extension in September but reported that the contract provides for payment of $1,000 for each day the contract is extended beyond the deadline spelled out in the construction contract.
The delay before completion amounted to 37 days.
Public Works Director Randy Gould recommended that the board approve a change order increasing the contract term by 49 days and assessing liquidated damages in the amount of $37,000.
The board also approved contract amendments for the Old Town and Lake Pinehurst sewer project. Under the amendments, the county manager is authorized to approve up to $50,000 to cover additional costs related to a sewer main issue on Magnolia Road. The engineers estimated that other similar issues may arise before the contracts are completed.
Hydrostructures holds the engineering contract, Atlantic Coast Contractors the construction contract.
The commissioners adjourned the meeting as the county board and reconvened as the East Moore Water District board to transact two pieces of business for the third phase of the East Moore water system.
They approved a contract amendment to provide an additional $35,099 for engineering design and $30,672 for inspection costs to cover several roads added to the system after the contracts were awarded.
The board also approved the purchase of Badger Meters from Carolina Meter and Supply for installation in the third phase, not to exceed $101,341.
Both items are included in the $5 million loan awarded to the district by the Rural Development arm of the U.S. Department of Agriculture. The third phase, as was the case with the first two phases, is being financed through the low-interest loan and through payments by future customers.
The board also took these actions:
n Approved a $746,998 Home and Community Care Block Grant contract to provide services through the Department of Aging, including in-home aide services, nutrition programs, transportation, senior center operations, information and referral.
n Approved a grant agreement with the N.C. Department of Transporta-tion-Public Transportation Division for Moore County Transportation Services. The Community Transporta-tion Program grant of $240,750 covers administration and capital expenditures.
The required local match of $47,947 will be met with user fees.
n Accepted a grant agreement and funding approval associated with the $70,000 Individual Development Account Community Development Block Grant and adopted the grant project ordinance establishing the budget and financial management standards.
The program is administered through the Northern Moore Family Resource Center, which is to provide the $15,000 local match.
n Approved a service contract with Vanderveer’s L.P. Gas Service Inc. of Biscoe to provide 36,000 gallons of propane gas at $1.92 a gallon for delivery to 17 county facilities.
The company does not charge a fee for leased propane tanks.
Contact Florence Gilkeson at firstname.lastname@example.org.
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