Warren considers borrowing $24.3 million for capital improvements in city
By ED RUNYAN
City council will probably make a decision in September on whether to borrow $24.3 million by selling bonds in order to make $14.7 million’ worth of capital improvements and refinance $9.6 million worth of debt.
Auditor David Griffing has given council estimates prepared by the underwriter of the proposed bond issue indicating the city will pay around $11.5 million in interest over the next 28 years on the $14.7 million.
Refinancing $9.6 million’ worth of debt will save the city around $2.3 million over the next 25 years, Griffing said.
In both cases, the interest rate will be around 5 percent, whereas the city’s current debt has an interest rate of around 6 percent. In financing of this type, rates are variable, Griffing said, not fixed like some mortgages.
Mayor Michael O’Brien has said this is the time to borrow money because of low interest rates — the lowest Griffing has seen in his 28 years with the city.
Griffing gave council members data to help them evaluate the bond proposal, put forth by O’Brien and Safety-Service Director Doug Franklin, who won the Democratic nomination for mayor in May and will likely become the city’s next mayor in January.
One thing Griffing says he can’t answer for sure how much the capital improvements — such as a new one-stop city administration building, new police and fire vehicles and road improvements — will save the general fund through improved efficiency.
Read the full story Monday in The Vindicator and on Vindy.com.