October 19, 2018 – The Clay County Commissioners voted 2-1 Monday to sell Certificates of Participation bonds to fund approximately $52 Million in improvement projects.
According to a prepared statement provided by Deputy Public Information Officer Payton Docheff, these funds will result in no tax increases for the residents of Clay County.
“Clay County budgets millions of dollars per year to keep up with the compounding effects of deferred construction, maintenance and safety upgrades. The estimated annual bond payment is $3.5 million, to be satisfied by reallocating funds used routinely for these types of projects. Rather than leaving important projects untouched, the county will take meaningful and responsible steps forward.”
Michael Short with George K. Baum & Company said the county will receive a good interest rate due to its credit rating. During the credit rating process, Short said the county’s credit rating increased from AA2, the third highest credit rating to AA1. Short said the funds will be obtained in a series of bonds that will be distributed to United Missouri Bank, who will act as trustee.
To request funds from the trustee, the county will have to submit requisition requests showing qualified repairs have been made, he said.
During the meeting, Eastern Commissioner Luann Ridgeway said the bonds will be repaid with funds generated from the use tax, a tax adopted in 2001. Ridgeway said the county currently uses funds from the tax to repair roads and bridges, on parks improvements and on capital improvement projects. Ridgeway said this tax does not generate enough funds to make the impact these repairs require.
“We can no longer take a Band-Aid approach when major surgery is required to address long overdue maintenance issues as well as making progress on new projects,” she said.
Short said to this date, $4.4 million have been generated, with county officials projecting a total of $5.8 million to be generated by the use tax by the end of 2018. Short said these funds will be more than enough to pay the $3.5 million per year required by the bond.
Presiding Commissioner Jerry Nolte said he felt the county would overextend itself by taking out these bonds. He said because the use tax funds repair projects throughout the county, if officials use it for bond repayment, funds will not be available for future repairs.
Western Commissioner Gene Owen said he supports the bonds which will allow for the building of a new county annex facility.
“The current building has insufficient space and infrastructure to serve the citizens who use it – officeholders have estimated that as much as half of their foot traffic uses the annex location,” he said.
Nolte said he opposes the debt placed on Clay County residents, to be paid out over the next 20 years, without a taxpayer vote. He said the county held no public meetings in advance to allow residents to express their concerns except for his town hall meeting held Thursday, Oct. 11.
“While I favor increasing the County’s investment in roads and bridges, many items on the list are foolish for long-term debt, like golf carts and carpeting,” he said. “Constructing a 60,000 square foot government building with almost no public discussion is outrageous.”
For a list of all proposed projects to be funded by the COP bonds, please click COP Projects.