ST ALBANS CITY -- On Monday night, the St. Albans City Council unanimously approved the 2021 Financing Documents for Vermont Municipal Bond Bank (D&V) in a roll-call vote, according to City Chief Financial Officer and Director of Administration Tom Leitz.
Officials say the $2.5 million was previously approved by the voters in the City on Town Meeting Day and will go toward sidewalk improvements according to documents from the Vermont Bond Bank’s website and Executive Director Michael Gaughan.
On the Vermont Bond Bank site, St. Albans City is listed to owe the bond bank a balance of 28,859,946, which does not include debt incurred outside of the bond Bank.
Once finalized, the new sum will bring the amount owed to the Bond Bank $31,359,946, though Gaughan said that with biannual payments -- the next being in November-- the amount would continue to decrease.
Leitz sang the praises of the Vermont Bond Bank in an interview on Tuesday for the low rates and pooled loan program that the Bond Bank provides for the City and their efforts to improve infrastructure.
“(I can’t stress) how much of an asset they are for us,” Leitz said. “The Bond Bank pools for all the municipalities and schools. The rate they get us in this market is incredible and they make it all administratively easy for us. Without them, we would need to get a credit rating...and do an awful lot of work ourselves.”
The earliest loan maturity date is listed currently at the Bond Bank is from December of 1969, while the latest loan maturity date is listed on the site for November of 2049.
“One payment is in May which is interest only, and one in November which is interest and principal,” Gaughan said.
According to documents provided by the city, a total of $488,625.22 was paid in May of 2021 toward interest payments.
Before that, in accordance with a September invoice for November 2020, a total of $2,053,197.11 was paid.
“At the bond bank, the way we fund our loans, we go out to the broad municipal bond market and sell bonds to provide funding for municipalities,” Gaughan said. “We access the market very efficiently, and then pass along that low cost to our borrowers... on Thursday of this week we will price the next bond, and then next week we will close on our bonds.”
Leitz said about $2 million will be paid this November toward the projects, and the City plans to have the total amount paid off in 20 years.
"We will likely have some more bonds to finish up our TIF district, but those projects are still being worked out," Leitz said. "The Aldis Hill Water Tower is a $2.3 million dollar project, and that may go to the bond bank. We have applied to the USDA for funding, and we're looking to see who will give us the best option."