Council OKs issuing of bonds


By Andrew Wigger - [email protected]



Adams


NEWBERRY — Newberry County Council has passed first reading of an ordinance to provide the issuance and sale of general obligation bonds not to exceed $1.9 million in aggregate principal amount.

“This ordinance pertains to the annual lease-purchase payment of principal and interest related to (past) rolling stock purchases (ambulances, fire trucks), and to indebtedness related to the county’s public work complex. Payments on this short-term borrowing are made each Dec. 30,” County Administrator Wayne Adams said.

Since fiscal year 2010-11, county council has been using this method to purchase emergency services rolling stock and other heavy equipment. This has two advantages, according to Adams, over using general operating funds for the same purpose.

The first, Act 388, imposes severe millage increase limitation on the operating levy, making it extremely difficult to use operating funds for these types of purchases. The indebtedness levy is not subject to Act 388 limitations.

“Also, this method only counts a given year’s borrowing, not the original principal amount or even the declining balance, against a county’s constitutional debt limit. The constitutional debt limit for any county is equal to eight percent of the assessed value of all taxable property within its borders. Borrowing beyond this limit requires a public referendum,” Adams said.

Since fiscal year 2010-11, county council has purchased $4.9 million in emergency services and public works equipment and rolling stock utilizing the lease purchase method of financing.

Examples of items purchased through this method include fire trucks, ambulances, fire engines, emergency radio upgrades, solid waste compactors and heart monitors.

“Where the public works facility is concerned, indebtedness against it is related to some of the funding used to build the speculative building in the Mid-Carolina Commerce Park. Banks resist lending for speculative buildings as such under lease-purchase arrangements,” Adams said. “This concerns the fact that a county council could vote in any given year not to renew the annual lease purchase debit, potentially leaving the bank stuck with a non-performing asset.”

The bank’s ownership of the speculative building would make no practical difference to a defaulting county government, since the building would still be located within the county, would still be attracting industrial prospects and would be owned by a motivated seller.

“Accordingly, lease-purchase debt must typically be tied to a building that is essential to the county, something the county cannot afford to walk away from,” Adams said.

It is worth nothing that Santee Cooper provided a portion of the financing for the spec building, that financing is applicable to the county’s constitutional debt limit.

Currently, this ordinance does not include any new lease-purchase indebtedness. This could change before third reading, and as county considers the debt service levy’s budget in the coming weeks.

The first reading was approved after Councilman Scott Cain made a motion and Councilman Travis Reeder seconded the motion. Cain also noted that this is a regular expenditure.

In other business, council approved a bid from Cannon Associates for $84,392 for IT suite renovations at Newberry Square.

The current budget contains $121,200 for this project, which will place the county’s servers in a secure environment adjacent to Piedmont Technical College, where they will be connected to communications fiber maintained by the City of Newberry.

For the past several years, servers have been located in a small room upstairs in the Agriculture Building on Martin Street. However, space, temperature control and security are less than optimal at that location.

“The low bidder, Cannon Associates, has converted similar space at this same location for use by County offices,” said Ervin West, director of Facilities Management.

Three bids were received for this project, along with the Cannon Associates bid. The county also received a bid from Smith Construction for $107,000 and another for Highlands Construction for $125,000.

Council accepted the low bid from Cannon Associates after Councilman Bill Waldrop made a motion and Cain seconded. Councilwoman Dr. Harriett Rucker noted that Cannon Associates is also a local company.

Other business

• Mike Briggs, president and CEO of Central SC Alliance Upstate, gave an update on his organization’s industrial recruitment efforts on behalf of Newberry County over the last year. A highlight from his update was that there are 11 active projects looking at Newberry County, 10 new and one expansion.

• Council had a public hearing and approved third reading of an ordinance that amends the 2016-17 budget ordinance. The county had undertaken non-budgeted expenditures in the current fiscal year. This amendment reconciles those expenditures prior to the end of the current fiscal year. The 10 items involved in this amendment total $909,419, of which 92.7 percent pertain to economic development.

Adams
http://newberryobserver.com/wp-content/uploads/2017/03/web1_Wayne-Adams-2-.jpgAdams

By Andrew Wigger

[email protected]

Reach Andrew Wigger at 803-276-0625 ext. 1867 or on Twitter @ TheNBOnews.

Reach Andrew Wigger at 803-276-0625 ext. 1867 or on Twitter @ TheNBOnews.

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