PTC eyes funding for aging infrastructure

New authority will use bonds to fund improvements

Peachtree City has been looking for a way to borrow more money at a cheaper rate.

They found it in a newly created city Facilities Authority that will address the potential acquisition of new bonds and/or the refinancing of existing bonds.

The authority will also address some of the city’s aging infrastructure needs.

The new board met June 29 to elect officers and again on July 1 in an informational meeting to get a look at potential bond refinancing and to review current facilities maintenance needs.

The make-up of the Facilities Authority board includes members of the City Council, with Councilwoman Vanessa Fleisch elected to chair the authority, Councilman Eric Imker elected as vice-chair and Peachtree City Finance Director Paul Salvatore as secretary-treasurer.

Fleisch at the outset of the July 1 informational meeting gave a brief summary of the context through which the Public Facilities authority would operate.

“This new authority was created out of the need to give the city another funding mechanism to help support its aging infrastructure,” Fleisch said. “Through this authority the city will be able to refinance current bonds and will also have the ability to create new bonds to fund the improvements that the city needs.”

Fleisch also noted that the July 1 meeting was intended to provide an overview of the city’s bond status and would not include any prioritization of projects that might be needed. Nor would any votes be taken, Fleisch added.

“Due to the economic climate over the past few years the city has not been maintained in the way it should have been. From the foundation of the library to the bubble at the aquatic center there are facilities across the city that need immediate attention,” said Fleisch, noting the decisions in the city’s recent history that led to the inability to no longer put off arriving at a solution to some of the aging infrastructure needs.

“These amenities and facilities are at the heart of what all of us know is the foundation of the quality of life here in Peachtree City and this new authority will have the ability to provide the resources that will maintain that quality of life,” Fleisch said.

Once underway, the meeting essentially covered two issues: a look at which of the city’s bonds might be refinanced and an overview of needed facilities maintenance needs.
Salvatore presented three of the city’s bonds that would be eligible for refinancing and where cost savings on interest could be generated. Those included the 2004 General Obligation Bond on the library, the 2007 Brick & Mortar note and the 2006 Equipment Lease.

Present value savings from a refinance on the $4.9 million General Obligation Bond that carries a 3.4 percent interest rate would be $51,706 as of Sept. 1, Salvatore said. A refinance of the $2.35 million Brick & Mortar note that currently carries an interest rate of 3.96 percent would amount to $80,930 while the $1.279 million Equipment Lease note at 4.029 percent interest would generate $29,369 in savings.

Salvatore said the projected savings had been considered by a financial officer familiar with bond refinance though he did not state the interest rate. Salvatore did note that some of the current city bonds would not be eligible for refinancing since the pre-payment penalty would offset any savings that would otherwise be realized.
The second portion of the meeting dealt with current and ongoing facilities maintenance needs. Used for informational purposes only, the board was presented an initial list of needs by city Public Services Director Mark Caspar.

 The list of 141 items was taken largely from maintenance and repair needs at only two locations, the library and the Kedron Fieldhouse. Some of those items represented ongoing needs that spanned a number of years, the issue that Fleisch has addressed earlier in the meeting.

Caspar stressed, and the board agreed, that the list was preliminary and was by no means prioritized. Caspar will prioritize the list and present it at a Facilities Authority meeting in the coming weeks or months.

It was also noted at the meeting that the function of the Facilities Authority is to make recommendations to the City Council. It is up to the City Council to authorize the Facilities Authority to proceed with the acquisition of new bonds or the refinancing of existing ones.

Authority member and Mayor Don Haddix at both meetings expressed the idea that proceeding with the authority before the City Council could undertake upcoming budget talks was premature. The board appeared to disagree and with little discussion continued with the agenda.

The organizational meeting of the Public Facilities Authority occurred two days earlier on June 29. That meeting was held solely to elect officers and adopt the by-laws and required resolutions.

The brief meeting ended with Fleisch elected to chair the authority and Imker elected as vice-chair. Salvatore was elected secretary-treasurer.

Asked after the meeting if there was a reason why he voted in opposition to Fleisch being elected as chair on the 4-1 vote, Imker replied, “No.”

NUK_1
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Facility Authority
Ben Nelms wrote:

Authority member and Mayor Don Haddix at both meetings expressed the idea that proceeding with the authority before the City Council could undertake upcoming budget talks was premature. The board appeared to disagree and with little discussion continued with the agenda.

LOL. Dingbat Don yet again ignored by everyone as he tries to yet again impede progress and assume that his opinion is the only one that matters.

Quote:

Asked after the meeting if there was a reason why he voted in opposition to Fleisch being elected as chair on the 4-1 vote, Imker replied, “No.”

That's interesting...I guess Imker just flips a coin and then decides since he doesn't use reason. What a guy!

ssidenative
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Prosperity carries a cost

Being nice, let's all assume that Mr. King's ultimate motivation is to make PTC a nicer, more livable, stable and safe place to live and raise a family.

That said, it's clear that he would - if given the choice - refuse to fund PTC infrastructure needs, cut personnel/salaries in city government, and refuse to at least maintain the current levels of amenities and services of the city.

So, Mr. King, how does one position mesh with the other? It doesn't. If you want to damage PTC irreparably, if you want to lower living standards to Clayton County/DeKalb County/third world nation levels, just continue to push for zero investment in the things that make PTC stand out. Recreation? Cut it to the bone. Police? Fire some officers.

The result? A broken down shell of a city that once was a wonderful place to live.

Mr. Squirrel had an excellent point - being one of the best places to live costs money, and it's up to PTC citizens (and their children if necessary) to make the necessary investment.

Certainly, proper procedures, checks and balances, etc., must be in place. But Mr. King, if this city were to follow your aversion to anything and everything that carries a cost, it would within months start an inexorable, irreversible deterioration.

Mr. King, if you want to pay lower taxes, move to Coweta County...or Liberty County (look it up; taxes are really low there). Buy you a few acres, go off and live by yourself, and have a ball with all the money you save.

But if you want to live in PTC - one of the best places to live known to man - quit bitchin' and start paying.

Mike King
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More Funding Equals More Debt

The question really should be what is the total cost of what needs to be done over the next ten years, then factor in the current level of debt so as not to act like the feds so as to enact a plan to get to where we should be in, say ten to fifteen years. The problem with the newly appointed Facilities Authority is that it can easily add to the current debt level without so much as a consideration to where Peachtree City stands financially. Will this Council add to the city's debt so that their children will end up paying for it?

Has anyone ever stopped to question why there is a constant rise in the cost of city government over the past five years? One might think there was a five percent inflation added annually. I realize the costs of doing business goes up, but not nearly as fast.

secret squirrel
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Okay, Mike

Those are obviously essential considerations which must be addressed. In the meantime, however, as these services and amenities degrade and decline, what remedy do you suggest? Close them up like Minnesota (which, by the way, is now experiencing a rash of crime and vandalism due to park closures)? The national marketing Peachtree City receives from publications citing it as a top place to live for retirees, families, etc doesn't come from dry financial calculations about amortized debt. It comes from having clean, working amenities. So while your point underlines an important consideration, what do we do in the meantime?

Mike King
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Squirrel

With a reserve fund of $9/10M we could easily prioritize over a ten year period to remedy each issue addressed thus far without raising taxes. What is alarming is those who would write a blank check so that those making decisions could elect to kick some projects down the road in favor of those that serve to make their base likely to keep them in office. Sound familiar?

Identify each and every need, set your priority and set aside funds from the existing budgets toward resolution with an influx of reserve as needed. Should there be a pressing requirement to spend more than allocated for a particular year, then a millage increase with a corresponding reduction in the city payroll for that year should be considered.

What is happening is that even in the city manager's proposed budget, he shows an increase from $27M to $32M for the out years with increased annual millage rates. Unchecked, this could be a pretty expensive place to live in twenty years.

roundabout
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New Bond Authority

It appears that members of the town council are on the board of the new FA, who then recommend to themselves (council) as to what they recommend to take on as long term debt or better interest rates!

I'm not always for a referendum for everything but millions of dollars which can be approved, basically, by the council alone sounds dangerous since they are not professionals.

At the same time I do realize that a place like Fayette County will not approve nearly everything we need in a referendum! (NO NEW TAXES).

What is the purpose of the FA?