Victoria MN Newspaper

VICTORIA COUNCIL VOTES 4-1 “FOR THE POSITIVE”

WITH CASH RESERVES AND LEASE REVENUE BONDS

City councilmembers responded on Tuesday, May 27th, to a petition they received on May 12th by voting 4-1 to finance the new City Hall/Library and new Public Works facility using Lease Revenue Bonds, a method of financing that is not subject to petition.

By using a combination of cash reserves on hand plus financing, the City was able to decrease the cost difference between using Capital Improvement Bonds and Lease Revenue Bonds from a projected $600,000 down to $255,000.

Finance Manager Kelly Grinnell said it amounts to $23,000/year difference in annual payment on the bond. The impact of the financing alternative to a median valued home in Victoria ($350,000) is roughly a $20/year increase in city property taxes.

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Approximately 40 residents were in attendance. Perhaps half were present for this issue. Seven stepped up to speak at the podium. Two spoke against the City.

City Manager Don Uram introduced the agenda item. "This item has been in discussion for several years," he said. "There are a number of environmental concerns in our buildings, and the buildings are too small. We've looked at a number of financial alternatives."

He said the the petition was signed by 345 residents. Seven of them were invalid. Number of required signatures was 216.

"The discussion tonight is not about if the buildings will be constructed," continued Mr. Uram, "but about the financing. We've presented designs, locations, costs. We rebid the electrical and saved $135,000. Contracts are signed. Groundbreaking is June 2nd. Work has started. We're moving trees at the Public Works site."

The finance manager said that by using $1.7 million in cash reserves plus $600,000 from the Revenue Stabilization Fund, the City only has to bond for $2.9 million.

In review, she confirmed $4,960,500 in total construction cost for the new City Hall/Library and new Public Works facility (which is less than the $5 million ceiling imposed by council) plus $1,186,350 in total labor costs. Total combined construction and labor cost of the two projects is $6,146,850.

Kelly further showed that financing the projects using CIP bonds would bring the cost to $2,975,000 while financing the projects using Lease Revenue Bonds would bring it to $3,230,000. The difference between the two methods of financing becomes much smaller by using cash reserves to help pay costs.

Clarified Mr. Uram, "In order to do the CIP bonds, you must hold a referendum and it must pass. The City does not have to act on the petition."

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Peter O'Gorman, a resident on Gannon Way, was the first resident to speak under this agenda item, prior to any vote on the issue. He said by not acting on the petition and by not holding a referendum, the City was denying the people their rights.

"We are not the ones who have been misleading people," he said. "A petition is a way to check your power. It's clear you intend to use the Lease Revenue Bonds. You're in a bind. You've made a commitment. We will remember who voted for this. You intend to disregard the outcome of a petition and referendum."

Randy Miller, resident at the Stieger Lake Condos and president of the Victoria Business Association, said he was speaking on behalf of the VBA, the business people in Victoria. "We publicly and strongly support the location and construction of a new City Hall/Library and Public Works facility," he said. "It helps create a sustainable business community."

Tom Funk, resident on Acorn Circle, said he gives more credit to the residents who signed the petition than does the City. "I did not lie or mislead people," he said. "We talked to 400 people. 85% of them signed the petition. You can take those results and extrapolate to the larger population. That means three out of four people want a referendum. I read the PCA report. There are only minor problems in this building. I've filed a law suit."

Mary Meuwissen, currently a resident at Mayer, spoke next. "I served two terms as mayor of this great city of Victoria from 1994 to 2002. I have a business in Victoria, Counselor Realty, in the Clocktower Building, and I own the Creamery.

"The City has needed new buildings for the past 15 years. The existing City Hall and Public Works facility are outdated, inadequate, and inefficient in many ways.

"Citizens want a viable strong downtown. That includes three anchors -- a City Hall, a library, and a grocery store."

Looking at Mayor Tom O'Connor and councilmembers, she stated, "Your vision to swap land in the downtown demonstrates your foresight. The City now has the lake, the park, the trail, and the future amphitheater. Thank you, Jerry and Terry Hartman, for swapping your lakeshore property for the Johnson house.

Click here to continue “For the Positive.”