When action stalled during the budget process — especially from June to August — interest rates rose on the roughly $9 million in debt eventually issued by the County Commission for capital projects in late August.
If that debt had been issued when it was first proposed, the county could have realized an estimated $250,000 savings in interest payments, County Mayor Dan Eldridge said Monday.
“In June, interest rates were at an all-time low,” Eldridge said. “The amounts on the various offerings ranged from 1 percent to 2.5 percent. Since that time, interest rates went up by about 50 ‘basis points,’ or about half a percent.”
At the time, Budget Committee members already had become quite familiar with the capital project costs, having generally dealt with the same numbers for months. The obligation bonds will provide for construction, renovations and equipment for the Highway Department, detention center, county archives, public safety, library, courthouse, bridge replacement and repair and renovations and equipment for county schools.
“The schools’ capital outlay note projection was for about $2.8 million, but they were only able to issue a little more than $2.6 million,” he said. “Their debt service on that will be about $260,000.”
What’s done is done. But money saved from the lower interest rates could have been used to pay for a nearly $186,000 increase in the Sheriff’s Department budget due to the expansion of the county’s SRO program, with money to spare.
That’s just one example. The savings also could have funded the $119,000 for the addition of a third Sessions Court judge or the $148,000 to pay for four more detention officers at the jail.
The County Commission last met Aug. 26, and the county’s final 2014 budget numbers were ready to be rolled out and voted on. However, commissioners were not yet in a position to act.
A final adjustment was made by the Board of Education, which in turn needed approval by the Budget Committee. That happened near the end of last month, but there was not enough time to properly advertise a reading of the budget, so the County Commission will meet tonight in a special called meeting to review and vote on a resolution to set the plan in motion.
On July 22, Commissioner Mark Ferguson unexpectedly introduced an amended version of a capital projects spending plan, originally hammered out and recommended to commissioners by the committee. Ferguson’s one-page spread sheet prompted debate, political finger-pointing and a merging of old and new budget numbers taking commissioners near the four-hour mark.
A vote on Ferguson’s amended version failed, as did a vote on the original resolution as presented by Eldridge and recommended by the Budget Committee. So the plan went back to the committee, which a few days later painstakingly raked over the projects and equipment line by line only to arrive at their original recommendation. The committee fired up again Aug. 1, just days ahead of a special called County Commission meeting Aug. 5.
The result of that meeting? Twenty eight capital projects, equipment and other costs in the spending plan all were voted back into the original resolution — one item at a time. Once that was done, a vote on the original resolution followed. Commissioners Sam Humphreys, David Shanks and Phyllis Corso were the naysayers in the 22-3 count.