Council members are insistent that the money be spent as directed.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
SHARON, Pa. -- City council is moving ahead with plans to borrow $6.1 million to refinance an old bond issue and provide $2 million for capital improvement projects.
Some members had recently expressed reluctance to approve the borrowing based on the city's finances, but the vote was 5-0 Wednesday to pass the first of two required readings of an ordinance authorizing the debt.
Refinancing now will save the city $104,000 in interest costs because of a lower bond-market rate, but it will also save the city $327,000 in a bond payment that would have been made this year but can now be delayed until 2003.
The latter amount will help reduce some of the $865,000 in red ink Sharon started this year with, said Mayor David O. Ryan, who took office in January.
Council members were insistent that the $2 million for improvement projects be spent exactly as earmarked in the ordinance.
Councilman Lou Rotunno said council has gotten inaccurate financial information from the city administration in past years and wants some guarantees that this money won't be diverted to general operating expenses.
"I really don't know how we can trust you guys with this money," he said to Michael Gasparich, city finance director.
Gasparich replied that the ordinance puts the money into a construction account and spells out where it will be spent. Council will have to approve all contracts and vote to pay all bills, just as is done with any other capital improvement projects, he said.
Of the $2 million, $1 million is set for street and curb improvements, $650,000 for replacement of the upper level of the Shenango Valley Community Library parking deck, $175,000 for heating and air-conditioning improvements to the city building and $50,000 to improve the library elevator. The rest of the money has not been specifically earmarked.
Rotunno said he would like to see some of the money set aside for sidewalk repair around the city.
Sharon is applying for some state grants to help with the library work, and if that money is secured, some of the bond funds can be diverted to other council-authorized projects, such as a sidewalk-replacement program, he said.
Council is expected to pass final reading of the ordinance at its September meeting.