Woodland Park City Council had a special meeting on July 30 to hash-out details for funding three proposed city construction projects, the Woodland Park Aquatic Center, a Memorial Park upgrade and a new fleet maintenance facility.
As recent as a month ago, City Manager David Buttery was working toward putting a bond question on the November ballot that would bundle the funding for these three projects.
Since then he said he realized there were easier ways to get the funding for the park and maintenance facility without raising taxes or asking voters to approve a complicated bond question that also would not raise taxes.
His suggestions called for funding the park upgrade and maintenance facility through a certificate of participation and asking voters to approve a bond question for the aquatic center.
Buttery explained that certificates of participation borrow against collateral and that bonds borrow against city revenue streams.
In the past, the city used a certificate of participation to fund the construction of the Public Works Facility and the Police Operations Center. As collateral, these two facilities would provide up to $3.55 million for construction of the two new projects. In addition, because the new certificate of participation would have substantially lower interest than the earlier certificate, the city would save $140,000 a year in interest over the next five years by rolling the older certificate into the new 20-year certificate.
“I’ve tried to take a very conservative approach,” Buttery said. “I have deliberately underestimated expected revenue streams and overestimated projected city expenses to make sure the city has enough money in its budget to pay off the COPs and any bond the voters approve.”
The estimated annual payment for the two projects will be $366,418, with 77.42 percent of the money coming from the city’s general fund, 14.29 percent coming out of the 410 street fund, 4.7 percent coming from the 510 water fund and 3.6 percent coming out of the 520 wastewater fund.
Because the aquatic center is much more costly, coming in at an estimated $10.1 million (not including interest) for land purchase; designing, constructing and equipping the facility; and designing and creating the associated infrastructure, Buttery said he thought it made more sense to ask citizens to approve a 20-year bond.
In the past, members of the Woodland Aquatic Project Board have estimated that the aquatic center will cost $7 million to build and that still holds true but there is more to constructing an aquatic center than just the building itself, Buttery said.
“For many years, Woodland Park residents have said they want an aquatic center,” Buttery said. “There is an emotional component to this that wasn’t there for the other two projects. We need to ask the citizens if this how they want the city to spend their taxes.”
He reiterated that the kind of bonds the city will be asking citizens to approve will not raise taxes. Both the bond payment and the COP payment can be covered by projected city revenues.
“We have to be disciplined to keep costs down,” Buttery said, adding that every amenity added to the aquatic center design will come with a cost. “If you want another water fountain get someone to donate one.”
Because it will take a while for the aquatic center to open and start generating revenue, if the bond question passes, the plan calls for making an interest-only payment of $196,950 in 2015, and an interest-only payment of $393,900 in 2016. In 2017 and thereafter, the annual payment was estimated at $815,621.
“There are some scary numbers involved with this bond question,” acting Mayor Carrol Harvey said.
Other council members agreed and told members of the aquatic project board that they would have a steep road ahead of them educating the public to approve the needed funding.
“If they don’t approve the funding, this all goes away,” said Councilmember Bob Carlsen, who is the council liaison to the aquatic project board.
The council approved Buttery’s suggestions unanimously, allowing the city’s bond counsel to create the bond-question language in time to bring it to the Aug. 7 council meeting as an ordinance on initial posting. The public hearing would take place on Aug. 21.