Discussion regarding financing options for the Ash Flat Fire Department's new building was the main topic of discussion at the city's first regular meeting of the new year on Jan. 18.
The urgency for the department to begin construction is being hastened by the impending library, which will be housed in the department's current location. Mayor Danny Traw has been attempting to obtain the best option for financing the department, based on estimates provided by the architect.
Traw reported to council that due to Amendment 78, cities can not go into debt for a period longer than five years and also can not lease a building for more than five years. Several options were discussed in regard to ways to finance the construction. The estimated cost of the building is just over $500,000. Fire Chief Stacy Horton explained the cost could be reduced by about $90,000 if the police department was taken off the building cost.
Members of council discussed this option and Alderman Sue Ross and Marty Goodwin seemed to agree that if the city would have to construct a police department later, or even pay rent or a lease, the cost would be significantly higher. Ross said, "One thing is for sure, the library is coming and we need to do something fast and we need to do it right." Other members of council also agreed it would be in the best interest of the city to consider all options and move forward with the most feasible choice.
Fire Captain Jared Allen addressed council regarding a bond option as a way to finance the fire department construction. Allen said he had spoken with Bob Wright, a representative with Crew and Associates, a company which specializes in bond issues. Allen said the company does most of the footwork, including public hearings and is lower on interest rates than others. The option that seemed most attractive to the city council was a revenue bond. This type of bond allows cities a means to finance debt for greater than five years. Allen explained there are two types of revenue bonds, both of which require public hearings, but one option can be completed faster with no public vote required. Allen said this option allows the city to pledge money from franchise fees and other income sources, if they are great enough to make payments. The timeframe required for this option is from 60-90 days. Allen said he would put the city in contact with Wright, who needs audit reports or other documentation to price the bond, which averages five to five and a half percent interest.
Fire Chief Stacy Horton also explained banks usually buy these bonds quickly. Allen said Wright is known locally for his bonds. An example of a $650,000 bond for 30 years would cost $60,000 annually. Allen explained the bond could be financed for more or less time. Traw told council one of the banks which he has consulted said it would provide a construction loan for the city, so they could begin construction and take the amount out later if the city opted to go with the bond issue.
After a great deal of discussion, council asked Allen to contact the bond company and have it set up a special meeting with the council as soon as possible. Alderman Tom Rigsby agreed with other members about moving forward with the project, saying, "If we piece this together it is going to cost more in the long run." Rigsby was referring to the option of not completing the inside of the department.
The meeting will be announced in an upcoming edition of the Villager Journal and on local radio stations.
In other business, the city accepted an offer from Shackleford Media for a city Web site. Previously, Shackleford presented his Web site idea to council at a cost of $2,500. Scott Shaffer, a representative of Shackleford Media, addressed council regarding the site, stating it was about 95 percent complete. Schaffer offered the city a much better deal. He said Shackleford Media would give the site to the city for a $500 donation to the Veterans Memorial. Council voted unanimously to contribute the $500 for the Web site. Schaffer also told them the first year of maintenance and upkeep would be free.
City council also voted to increase the cost of rent for the community center from $30 to $50 for a half day and from $50 to $75 dollars for a whole day. Council discussed some issues the city was encountering regarding renters not cleaning the facility properly and not having a person to check the building after each rental, since rentals can be back to back and it is sometimes hard to determine which group did not properly clean the facility.
In 2011, the Ash Flat City Council will continue with their third Monday meeting schedule at 6:30 p.m. The public is always welcome to attend these meetings.