FLINT TWP. — After a few financing ideas being tossed around since March, it looks like the police station debt is headed towards an early pay-off.
At its Aug. 12 meeting, the township board approved hiring bond and finance attorneys to oversee the process of obtaining a bank loan to pay off the police bond.
At its July 15 meeting, the board unanimously agreed to seek proposals from various local banks to find the best loan terms to pay off the police bond and retire the debt about ten years ahead of schedule.
That idea came about because there appeared to be resistance from some board members to the original idea of using cash reserves from the sewer and water fund which has accumulated to about $6 million.
Paying off the police bond from the fund would require approximately $1.4 million but is estimated to save the township up to a half a million dollars in interest fees in the long run.
Township Controller Beth Takacs was given the green light to shop around for the best quote from local lending institutions. She came back to the board with the request to hire counsel.
“If Flint Township is going to obtain a bank loan to redeem the Police Station Bonds, it will be necessary to engage he services of bond and finance counsel to ensure the process complies with regulations,” Takacs said in memo to the board.
She recommended the services of Carl Stafford of Bodman LLP as bond counselor and Tom Enright as finance counselor. Both served as counsel for the existing police bond and for a Dyewood Bond issue.
Takacs said there is about $25,000 in fees associated with obtaining the bank loan to pay off the bond and hiring bond and finance counselors to oversee the process.
“Since we will be saving a significant amount of money in interest expenses by redeeming these bonds, the $25,000 expense is certainly worthwhile,” she stated.
The board’s unanimous 5-0 vote to approve hiring counsel was followed by an enthusiastic “yes!” from Supervisor Karyn Miller. Treasurer Marsha Binelli and Trustee Frank Kasle were absent.
Trustee George Menoutes asked if the attorneys needed to be hired before the board made a loan commitment with a bank.
Miller said the approval vote to hire counsel effectively made that commitment.
Interest payments on the police bond come due twice a year so getting the loan in place to pay it off needs to be done expeditiously, she said.