City of Chelsea to borrow $2 million for sports complex, capital projects
The city of Chelsea will borrow $2 million to complete its new sports complex and other capital projects.
“The reason we’re borrowing this money is not because we’re in a bind for money,” Mayor Earl Niven said during pre-council. “But the reason we’re borrowing it is to complete the capital projects, to hold our reserve to where we can keep a AA rating.”
Matt Parker with Joe Jolly & Co. spoke during the Feb. 2 pre-council meeting to discuss the terms of the new bond. The bond deal includes refinancing at a lower interest rate, and the city’s repayment of this and other loans will continue at a similar rate — $1,250,000 annually until 2024.
Before the new bond, Chelsea was set to have no debt as of 2024. Now, that timeline extends to 2030, with payment from 2024-30 dropping to $380,000 annually.
“2030 sounds like it’s forever and it’s never going to get here, but that’s only 15 years,” said council member Dale Neuendorf.
Parker said Chelsea’s debt structure is short compared to similarly sized cities, and the city benefitted from its AA/Stable rating on its credit profile.
“We’re very, very proud of our city,” Niven said, “the financial conditions and with other people recognizing it.”
Borrowing this money will allow the city to complete the new sports complex on Highway 11 and other potential capital projects, while maintaining around $2 million in its reserve fund.
The sports complex, Niven said, will help benefit Chelsea in the future. He said the complex will help bring tournaments to the city, which thereby helps businesses and increase sales tax revenue.
During pre-council, Niven also discussed projects the city has completed or has in progress. The city has completed around $4,371,000 in projects that are also paid off, and it has paid around $5.4 million for projects that are in progress.
“This, again, is something to be proud of,” Niven said.
Council member Tony Picklesimer asked Niven why the list did not include the cost of land for a new fire department, which was budgeted for and set to be purchased this year.
“We’re working on it not costing [anything],” Niven said.
Also at the Feb. 2 meeting:
- Boy Scout Troop 354 attended and led the Pledge of Allegiance. Troop members attended the pre-council and council meetings for their citizenship and community merit badges.
- Niven discussed a 50-foot-by-70-foot plot of land where Brogdon Properties plans to build a new pumping station for The Highlands Community. The land is located by the new sports complex, and Niven said they are planning an exchange where the city gets the dirt from the property, and Brogdon receives the plot of land. The dirt will be used at the sports complex, he said, thereby saving the city money on the project. “He’s got dirt available and we need dirt, so it will benefit both of us,” Niven said.
- Niven discussed donating one of the fire department’s older engines which is not used anymore. Fire and rescue Chief Wayne Shirley discussed the Terry Farrell Firefighter’s Fund, which helps support firefighters, families and fire departments in need. Shirley said the organization could help do any necessary work on the engine and help pair the city with a department in need.
- Niven noted the Chelsea Community Center continues to see a rise in attendance, with a total of 4,320 visitors during the month of January.
- The council approved to pay the city’s bills.
The next city council meeting is Feb. 16 at 6 p.m.