Village Postpones Purchasing Bonds for $2.5 million

The Fox Point Village Board on Tuesday postponed a vote on borrowing $2.5 million in bonds for capital improvements this year.

Village Manager Susan Robertson told the board the money would be used for projects in 2011 ranging from street resurfacing to purchasing trees.

The street resurfacing would cost $60,500 and would include work on Lake Drive and Green Tree Road.

The village also budgeted $1.1 million for "improvements" to the Bridge Ravine footbridge, but as , the board is looking to delegate only $550,000 toward the bridge, relying on donations for the remainder of the cost. The improvements the village would approve, however, are still uncertain and could range from demolition to replacement of the bridge.

The proposal also calls for new vehicles and equipment for the Department of Public Works. With new dispatch equipment and updates, a pressure washer, a mower, a pickup truck with a plow, a rubbish scooter and a demolition saw, the total for DPW comes to $165,000.

In addition, the proposal calls for $48,660 to go toward recreation and forestry, $50,000 for a retroreflectivity study, $114,290 to the North Shore Fire Department and $79,050 to the North Shore Library. This brings the proposed capital projects budget to $1.6 million.

The final $820,000 will go towards the sewer fund, including a rehabilitation project.

Two projects were dropped from the resolution, including $28,000 for the telephone system and $3,000 for the Village Hall ventilator. Robertson said in her memo to the board, "I think there will be sufficient funds that the projects can be funded out of the Capital Projects Fund unappropriated fund balance."

Trustee Eric Fonstad took pause at the total amount of the proposal, asking Robertson if all the money would be used this year. She said that while it should be, the money would not be lost if it is not spent.

"Why borrow and pay interest if we're not going to use it until next year?" Fonstad said.

The village's financial adviser, Robert W. Baird Co., prepared a financial plan that was also presented at Tuesday's meeting. It showed that if the village borrows the full $2.5 million, the mill rate will increase by 13 cents per $1,000 of assessed value on property.

Fonstad questioned what would be done with the remaining funds if say, for example, the full $79,000 was not used for the library.

West inquired about utilizing unused funds for other projects.

"We can't just go the market and say we're borrowing for x and do y," West confirmed. "We have to tell folks the purpose of our borrowing."

Fonstad had two concerns with the resolution. His first was wondering if the wording "footbridge improvements" is broad enough to cover all three options the village is still considering — deconstruction, repair, or rebuilding.

"I don't want us to paint ourselves into a corner," Fonstad said. "I'm concerned that calling this 'footbridge improvements' would foreclose us from using the money to cover the expense of removal for instance."

Robertson explained that the wording is looked at very closely by the bond council, a group that approves the proposed borrowing.

Fonstad's other concern was with the timeline presented for these projects, potentially not utilizing all  $2.5 million within 2011.

"I have a problem with the first year cost of borrowing $1.1 million," he said. "Why borrow the money today if we don't need it? We're going to pay interest on it."

And that interest, in the first year alone, totals $111,107, including sewer renovations.

The board voted 4-1 to hold the resolution until the April meeting, allowing the bond council to review the phrasing for the footbridge to make sure that "improvements" would also allow for deconstruction.