The Dexter Leader
A Heritage Newspaper
Weekly Publication
DDA authorized to sell revenue bonds
By Sean Dalton, Staff Writer
PUBLISHED: February 14, 2008
The Dexter Downtown Development Authority received authorization to bond for up to $3.6 million from the Village Council Monday.
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The bond proceeds will be sought in two series, one a taxable bond and the other tax-exempt.
The taxable bond will be in the amount of up to $1.6 million and the other will be for up to $2 million.
"Typically we go out for one bond issue," said DDA Chairman Dan O'Haver. "It is somewhat unusual to go out for two separate issues."
According to O'Haver, the $1.6 million bond is separate from the tax-exempt $2 million bond because it will be used to purchase private property that will remain private for a number of years.
"While that use is private it is generating income for profit, so it is not appropriate to use tax-free bonds for that," O'Haver said. "You have to go out into the market and sell a public bond and pay a little bit higher interest in that case."
Once the property is owned fully by the DDA within five years, those taxable bonds will be recalled and tax-free bonds will be issued in their place.
In October the DDA identified eight possible projects for the current fiscal year that came in at an estimated $6.3 million.
Most of the potential expenditures on the project list are tied to the acquisition of property along Mill Creek and a streetscape project on Forest Street.
None of the bond money is in play until project cost estimates are in.
According to O'Haver, tonight's DDA meeting will authorize consultants to prepare the bid documents.
"If a purchase agreement falls through we won't bond for it," he said. "If our projects come in under $2 million, it might be a $1.5 or $1.7 million bond. "At this point in time, we just have the capability to bond for funds, but not funds."
The $2 million will pay for installation of a Mill Creek Bridge streetscape, reconstruction of Jeffords Street between Main and the intersection of Broad and Forest, and other streetscape and road improvements.
It will be used to acquire property along Mill Creek that is classified as a brownfield. "Turning brownfields to the benefit of our downtown is probably one of the greatest accomplishments a DDA can make," O'Haver said.
This will be the DDA's third bond issuance, according to O'Haver, who said there was a $2 million streetscape bond in 1996 and a bond to build a parking lot which cost the DDA $900,000.
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