On Monday, December 14, Milford City Council approved the issuance of General Obligation Bonds in an amount not to exceed $20 million and scheduled a referendum on the issuance of the bonds for January 26, 2021. Council was provided an estimate for a new police station of just over $19 million.
“The plan is to work on the scoping and cost of the project to try to minimize costs as much as possible, “Lou Vitola, Finance Director, said. “If we are able to make some changes and reduce the costs, that will be great, but this resolution gives us the authority to borrow up to $20 million if there are any overages at all. Our goal, however, is to borrow less than that.”
Vitola reported that it had been determined the City would not have to pay prevailing wages for the new police station as USDA projects do not require it. This could save as much as 30 percent on the project which indicates that the project could come in well under $20 million. However, he cautioned that it is still too early to know where savings could be found during the planning of the new station.
“Just to simply it, this will be like a credit line,” Councilman Todd Culotta said. “We will use what we have to use. If we drop this amount to $15 million, we will have to come back to the public for another vote if we go over that amount. This way we don’t need to do another vote because changes or other factors caused us to go over budget.”
City Solicitor David Rutt cautioned Council that the resolution was part of a public hearing that was advertised as “not to exceed $20 million.” He stated that if Council changed the amount, they would need to table the discussion and schedule a new public hearing. Councilman Doug Morrow pointed out that Council had a lot of time to discuss and rehash the amounts prior to this meeting.
“We have a resolution on the table,” Councilman Morrow said. “If we come in under $20 million that is great but this gives us some cushion so we can get the police what they need.”
Mayor Archie Campbell asked if the police station came in less than $20 million, when would the City be able to inform the public that taxes may be lower.
“If the vote is approved on January 26, there will be a long delay between that date and the time that debt is actually incurred,” Vitola said. “That decision can be made down the road. We can stagger the tax increase based on the actual amount borrowed and the resulting debt service. It can be delayed and if the debt is issued in staggered increments, the resulting debt service would also require incremental tax increases. I don’t think it is advisable to make a blanket statement or promise that it would be staggered over three years at this time.”
Mike Svaby, Director of Public Works, pointed out that these projects often have changes throughout the construction process and those changes are not free. The plans can be fine tuned when the project goes out to bid and provide for some savings at that time.
“We are heading in the right direction,” Councilman Jason James said. “We have discussed this many, many times. These are not to exceed numbers. We don’t have to spend it all, the rate may not be five percent. WE may not go above $20 million. It is confirmed we don’t have to adhere to the prevailing wage rate which can save us up to 30 percent. The last rate I saw provided by Lou was three percent and he is giving us up to five. I think these do not exceed numbers are what we want.”
Council voted seven to zero to authorize the bonds and schedule the referendum.
“Chief Brown has sufficiently demonstrated a need for the police station due to the growth of the City,” Councilman James said. “the news around is that Milford is the fastest growing cities in the state and the current station is not large enough to support the current police force. I believe this is a win-win for the police force and the citizens of Milford.