City councilors approve Harbor Walk funding
Belfast — The Harbor Walk Project is moving forward after city councilors met Tuesday, Aug. 21, and approved two bond resolutions for a total of $1.2 million to complete construction of the waterfront walkway.
Councilors approved an $800,000 general obligation capital improvement bond and a revenue anticipation note in the amount of $400,000 to cover a grant Gov.Paul LePage froze earlier in the summer. During a public hearing regarding the issue, residents spoke out in favor of and against the proposed borrowing.
With the approval, City Planner Wayne Marshall outlined a rough schedule of how the project will proceed. He anticipated receiving all bids by Oct. 4 to then bring those numbers to the Oct. 16 Council meeting. He said if the numbers are not acceptable, the project would need to be revised before the plan is resubmitted to the Maine Department of Transportation for approval.
Belfast residents Blaine Richardson and Rita Horsey, who have vocally opposed the borrowing during previous meetings, again requested the Council to consider alternative revenue sources, instead of taking on additional debt.
Richardson characterized the intent to borrow against the $400,000 grant as being the same as if he went to a bank to get a loan against any of his future winnings at Hollywood Slots Casino.
“I’m very frustrated. You say we don’t participate, but when we do participate I feel like it falls on deaf ears,” Richardson said.
As an alternative to borrowing, Richardson suggested the city attempt to raise the capital through private fundraising. Both the Belfast Common and dog park projects were completed through private fundraising, Richardson said.
Horsey expressed similar sentiments and said she feels there is no payback to the community for completing the Harbor Walk Project. She suggested that if people want the walkway, they would contribute money to see it completed. She also challenged the view of supporters who said at past meetings that the project would provide a valuable walking resource in the city.
“This Harbor Walk will not make money,” she said. “As for walking, all of Belfast is a great walking place. We don’t need the Harbor Walk for walking.”
Resident Paula Johnson said she is in favor of the Harbor Walk, and also urged the Council to consider finding other ways to fund the project. She said she feels there are social benefits associated with the walk that would in turn benefit the local economy as people ride bicycles and walk on the path.
Resident Petra Hall noted that delaying the project could be risky, because bond rates and material costs would most likely increase. She said she believes the Harbor Walk is an investment that could provide a boost to the area, both economically and residentially.
“To put off the project to a future date carries a financial risk,” Hall said.
10-year vs. 20-year bond
A borrowing estimate from the Maine Municipal Bond Bank shows an $800,000, 10-year bond would cost the city about $963,587.20 by the time it’s paid off in 2022. Yearly payments would begin at $108,907.20 before decreasing each year to a final payment of $83,200.
The 20-year bond would cost the city $1,143,145.60 by the time it’s paid off in 2032. Yearly payments would begin at $70,440 before decreasing each year to a final payment amount of $40,850, according to the cost estimate.
Interest rates for a 10-year bond would begin at 3 percent in the first year and go up to 4 percent in the final year of the bond. The 20-year bond would see interest rates begin at 3 percent and increase to 4.25 percent in the final year, according to the cost estimate.
City Manager Joseph Slocum requested direction from the Council as to whether the city should apply for a 10-year or 20-year bond. Councilor Marina Delune suggested a 20-year bond would be the better option, because it would mean the city would pay lower payments, albeit with more interest over the life of the bond.
“I think we’ll need that money for other projects,” she said.
Delune also said the approval of the bonds does not mean taxes in the city will increase. In fact, she said, the bonding packages have no impact on taxpayers, as the money to pay for the bonds will come from the Tax Increment Financing fund.
Councilor Eric Sanders said he supports the $800,000 bond and the 20-year term because the TIF will cover the payments.
Councilor Nancy Hamilton said a 10-year bond would result in nearly all of the TIF being spent, and she felt there were other important projects in town that would need to be addressed in the future.
Councilors Roger Lee and Mike Hurley both highlighted the need for Belfast to invest in projects that increase the attractiveness of the city to continue drawing people to the area. Lee said the job of the councilors is not just about making sure the roads are paved and the sewer lines are flowing; he said there is a responsibility to make Belfast as attractive a place to visit and live as possible.
Hurley agreed and said he remembered when people were originally against the footbridge renovation, but after completing that project, Hurley said, he hears from residents who say they really enjoy it now.
“I think we're on a really great track,” Hurley said.
Currently, the city makes total yearly payments of $485,899 for projects that were bonded in 2003, 2004 and 2005. The city has a total debt service load of $5,588,164, which does not include the $800,000 bond or $400,000 revenue anticipation note.
$400,000 revenue anticipation note
Councilors were optimistic that the $400,000 Communities for Maine’s Future Grant would be released to the city, with Sanders noting the payments would be about $6,000 year.
Delune, who had previously expressed concern about the $400,000 anticipation note, said she had reconsidered her position because she realized that to make changes to the plans for the portion of the walkway at Steamboat Landing would be too costly.
After approving the revenue anticipation note, Slocum asked councilors to approve a quote he received for the revenue anticipation note from Bangor Savings Bank, which came in $300 lower than the quote provided by Camden National Bank.
Councilors unanimously approved the Bangor Savings Bank quote.
Republican Journal reporter Ben Holbrook can be reached at 338-3333 or at email@example.com.