Ordinance 2494: Bond Ordinance For Capital Improvements

Ordinance 2494: Bond Ordinance For Capital Improvementsthumbnail
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Published: June 10, 2017 @ 6:00 AM EDT

Even though council voted to approve amendments to this year’s $2,468,000 capital budget with Resolution 159-17 at the June 1st Mayor & Council meeting, Ordinance 2494 needs to be voted on in order to issue the debt.

Resolution 159-17 is a formality that lists the four (4) major categories of the capital budget and files the resolution with the Office of the Director of Local Government Services. Those are:

  1. Purchase of Equipment & Capital Items
  2. Various Improvements to Borough Property
  3. Resurfacing of Three (3) Streets
  4. Open Channel Storm Sewer Improvements

The ordinance is the official document that gives the authorization to issue the debt and allows the capital funds to be spent.

The details of the four categories are listed below:

Purpose
Appropriation and Estimated Cost
Estimated
Maximum Amount of Bonds or Notes
Average Period of Usefulness
(i) Purchase of equipment and capital items for various departments including but not limited to:

(a) street sweeper and signs for the Public Works Department;

(b) emergency communications radio system for the Public Works Department, Police and Fire Department, First Aid Squad and Office of Emergency Management;

(c) Scott SCBA air bottles, turnout gear and pagers and batteries for the Fire Department and;

(d) computer equipment and software for all Borough Departments.
$1,042,000
$980,000
10.8 years
(ii) Various improvements to Borough property including but not limited to improvements to municipal buildings and grounds, sidewalk improvements, tree plant Borough-wide, improvements to Library buildings and grounds ADA ramp and replacement of roof and gutters at the Casano Center, including all work and materials necessary therefor or incidental thereto, all as shown on and in accordance with the plans and specifications therefor on the file in the Office of the Clerk.
$360,000
$313,000
15 years
(iii) Resurfacing of various streets, including but not limited to East Colfax Avenue from Chestnut Street to Walnut Street, resurfacing of Butler Avenue from Meadow Street to Locust Street, resurfacing of Spruce Street from East Clay Avenue to East Lincoln Avenue, including all work and materials necessary therefor or incidental thereto, all as shown on and in accordance with the plans and specifications therefor on the file in the Office of the Clerk.
$716,000
$677,000
10 years
(iv) Open channel storm sewer improvements between East Lincoln Avenue and East Webster Avenue and various improvements to sewer system, including all work and materials necessary therefor or incidental thereto, all as shown on and in accordance with the plans and specifications therefor on the file in the Office of the Clerk.
$350,000
$330,000
40 years
TOTAL
$2,468,000
$2,300,000

$2,468,000 is the total amount budgeted for all capital projects this year. $2,300,000 is the amount not covered by grants and is to be paid by property taxes over a specified number of years – like a mortgage – through a bond. The average period of usefulness of the improvements, according to the reasonable life thereof computed from the date of the bonds authorized, is 15.32 years.

The single largest expense in this year’s capital budget was $700,000 for an upgrade of the municipality’s radio system for police/fire/first aid. This is a requirement in order to have communication more secure and to be able to communicate with the county or other police departments in the event of an inter-municipal emergency such as the pursuit and apprehension of bombing suspect Ahmad Khan Rahami who was captured in Linden. Police Chief Paul Morrison calls the upgrade an issue of public safety and although expensive, necessary to provide safety for officers and he public.

Emergency channel repair between East Lincoln Avenue and East Webster Channel was another major expense for $60,000.

For 2017, the municipality will be making around $1.54 million in payments and budget $2.3 million in debt. This $760,000 difference means that the borough will spend more than it will pay back this year. Usually, Chief Financial Officer (CFO) Ken Blum tries to keep expenses in the capital budget equal to what is owed but the $700,000 for the required radio system upgrade and $60,000 for the emergency channel repairs made that impossible. Had these two expenses not been included, the amount for debt services that is to be paid back would equal the capital budget expenses for the year.

Ordinance 2494 is scheduled to have its public hearing and vote at the June 15th Mayor & Council meeting in Borough Hall at 7 p.m.

A copy of the ordinance is included below:


Download RP Ordinance 2494