The Waupaca County Board considered three bonding resolutions Tuesday, Sept. 21.
The bonds totaled more than $16 million.
The first resolution passed unanimously. The second failed to obtain a necessary three-fourths majority. And the third resolution, which was needed for the first two bonds to be issued, was tabled.
The first resolution was to refinance $11.34 million in bonds issued in 2002 to finance the construction of the new Waupaca County Law Enforcement Center.
Todd Taves, a financial advisor with Ehlers & Associates, told the board that the county could save nearly $570,000 in debt payments from 2012-17 if it approved refinancing the older bonds.
Supervisor John Trambauer, of rural New London, asked Taves about the county’s current total debt.
According to the latest financial audit, Waupaca County had just over $31 million in debt as of the end of 2009.
“It would be less than that because of the payments you’ve made on the principle in 2010,” Taves said.
Supervisor Dennis Kussmann, of Clintonville, asked how much the county has borrowed over the past five years.
Taves said the county has borrowed about $16 million since 2005 and is currently paying down about $4.7 million in debt principal annually.
“All existing debt would be fully amortized within 10 years,” Taves said, adding that Waupaca County has a strong record of paying down its debt at a fairly rapid pace.
After they approved the first resolution to refinance the 2002 bonding, county supervisors began discussing a proposal to borrow $3.93 million to fund capital improvement projects in 2011.
The projects include $3.6 million for county road improvements, as well as new forensics software for the sheriff’s department, a new boiler for the courthouse, upgrades to the air-conditioning control system and a new recycling baler.
“I thought long and hard on this resolution after the last meeting,” said Supervisor DuWayne Federwitz, who represents the Clintonville area. “Why would nine people vote against this assuming that it amounts to the cost of a small Blizzard.”
Federwitz noted that the $3.93 million bond would increase the mill rate for the county’s debt from $1.41 per $1,000 of assessed valuation to $1.44 per $1,000.
He said the owner of a $100,000 home would see an increase of $3 to pay for the bonding required to keep county roads maintained.
“There are 340 miles of county highways,” Federwitz said. “A road lasts approximately 20 years. Do the math. You need to do 17 miles of road work a year to keep up.”
Without the bonding, Federwitz said the county would fall behind in its road maintenance plans.
He also noted that the county had the opportunity to borrow at a 2.1 percent interest rate.
“We will not get an interest rate this low again for a long time and the cost of the materials will only go up,” Federwitz said. “Instead of costing taxpayers less than a Blizzard, you could be costing them two Blizzards and two milkshakes down the road.”
Supervisor Jack Penney, of the town of Lind, asked how much of the county’s tax revenues go toward debt payment.
Taves said that of the county’s total $5.80 mill rate, $1.41 went to pay debt. He estimated that less than 25 percent of the county’s tax revenues are used for debt payments.
“I think it’s important that we pass this bonding so we can keep improving our highway system,” said Supervisor Jim Loughrin, of New London. “We cannot close shop and go out of business. We must provide the services for the citizens of Waupaca County.”
Supervisor Don Morgan, of Weyauwega, said the county “is playing the same budget game the state played. We’re taking money from the highway department and using it for other departments.”
Morgan noted that the county had lost close to $2 million on its nursing home, Lakeview Manor.
“I believe strongly that we should look for savings and efficiencies in every department in the county,” Morgan said.
The resolution to borrow $3.93 million needed 21 yes votes – a three-fourths majority – to pass. It was defeated by a vote of 17-10.
The 10 supervisors voting against the resolution were Kussmann, Darrell Handrich, Donald Peterson, Jim Boyer, Gerald Murphy, Bob Ellis, Penney, Dave Johnson, Pat Craig and Morgan.
Then the county board discussed a third resolution to issue $16.75 million in promissory notes. The final resolution combined the first two bonds, as well as two previously approved expenditures of $610,000 for road work in 2010 and upgrading the county’s emergency radio system.
Supervisor Martin Mares, of New London, made a motion to approve the resolution as written. However, the county’s legal counsel, Jeff Siewert, said the motion was invalid because the board had already defeated the $3.93 million resolution.
Supervisor Boyer, from Waupaca, then made a motion to table the resolution. The motion passed by a 14-13 vote.