Plymouth City Council members held the first readings over two ordinances that would establish funds related to the major projects on Miller Drive when they met for their final meeting in May.
The city recently sold two bonds that generated approximately $6.6 million dollars for these projects.
As previously reported, the projects on Miller Drive will include the construction of a 10-lane indoor pool facility, a new building for the Marshall County Community Foundation offices and an early childhood learning center. For the sake of brevity, all of these projects are collectively referred to as the “Aquatics Center Project.”
Clerk-Treasurer Jeanine Xaver stated that the first ordinance considered by the council would create the “Aquatics Center Project Fund”.
Xaver explained, “The bond proceeds will be receipted into that and then the expenses will be everything associated with the Aquatics Center Project.” She elaborated, “That will be spent on bond issuance costs because we have to pay Ice Miller, the legal counsel and we have to pay the accountant so that kind of stuff will come out of that, as well as the construction costs.”
City Attorney Sean Surrisi said that the second ordinance considered would establish something called the “TIF 3 Debt Service Reserve Fund.”
In order to explain why that fund is needed, Surrisi stated that one of the bonds that was taken out will be paid back over the next 25 years. He said the money to pay off that bond will come from the revenue generated from the lease payments made by the entities supporting the project.
Surrisi said to guarantee that all the necessary payments will be made to the lending institutions, the Redevelopment Commission pledged a “debt service reserve.”
The attorney explained, “That is basically money that is set aside that if for any reason, one of the four entities failed to make a lease payment so that there wouldn’t be enough funds to pay off the semi-annual bond payment, that they would step up and use money from this debt service reserve to make those bond payments.”
Clerk-Treasurer Xaver added that the money for the debt service reserve will be transferred out of TIF 3 or the 2005 Tax Increment Financing area, which is the location where these facilities will be constructed.
The ordinances were approved on first reading and will be considered again this month when council members meet on Monday, June 11th.
