The project to connect Mill Wood Boulevard will start next year, and the city is looking to issue some debt to fund it.
City officials spoke to the Marysville Finance Committee Thursday night about the debt.
Finance Director Justin Nahvi said the project to extend Mill Wood Boulevard to Route 4, in the Cook’s Point development, will cost about $4.2 million, but the city is looking to borrow $4.4 million. He said this is because if the city were to issue debt, it would likely need to do so at a discount.
Essentially, investors will front an amount to the city. Since it will be at a discount, the city will be expected to pay back more over time. For example, if the city were to issue debt that was 98 cents on the dollar, an investor buying $1,000 will give the city $980, and will receive $1,000 back over time.
Mark Reams asked whether the city is taking on any risk with the debt. Officials said the way the Tax Increment Financing agreement at Cook’s Point breaks down means the city is taking on no risk.
The city will front about $200,000 to pay for the design of the project, which will be reimbursed per the agreement.
In an interview with the Journal-Tribune, Nahvi said there is no risk because the city will take on a letter of credit from the Richwood Bank for $4.4 million cost of the project, which he said is an insurance policy for debt payment. If the city runs up against any problems with repaying this debt, the letter of credit will back the city up.
According to Nahvi, the debt likely wouldn’t be issued until October. It would have to go through the standard three readings at city council before issuance.
He also said City Engineer Jeremy Hoyt is looking to get started on project design soon. City Manager Terry Emery said, if all goes according to plan, work on the road can begin soon.
“We’ll be in a position to get the project bid out early in 2018, get good pricing, be able to begin and complete that project by fall,” Emery said.
Nahvi highlighted the increased safety in the area, since units from Decker Fire Station on County Home Road will have quicker access to Mill Valley.
He said, with the committee’s blessing, he plans to begin pursuing the legislation in July.
Emery said the project will likely coincide with the first phase of the city’s Route 31 widening project.
“Both will be ending pretty close to around the same time frame, which would be very nice,” he said.
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