County Bonding Update

Linn County Supervisor Lu Barron and county staffers visited The Gazette’s editorial board this afternoon to discuss issues surrounding the possibility of floating bonds to expanded the county’s Administrative Office Building, or AOB.

Last week, supervisors talked about using new powers granted by the Iowa Legislature allowing counties and cities hit by disasters to sell bonds without first seeking voter approval. That sparked some controversy, because the $11 million AOB project being discussed includes costs that go beyond simply repairing flood damage. 

One piece of the project involves adding a new floor to the building to house offices, including new digs for the supervisors. I wrote about the issue last week.

Now, Barron says disaster bonds are just one of several options being considered.

“Our intentions are good in the fact that we want to come back better after the flood,” Barron said.

First, the county plans to seek a state grant for the AOB through Gov. Chet Culver’s shiny new I-Jobs bonding program. Linn County will be competing against scores of communities for a slice of $118 million in state bucks for local infrastructure projects.

If that doesn’t work, the county has three bonding options.

One is the disaster bonding power discussed above.

If supervisors take that route, residents could still seek a public vote through a “reverse referendum.” But they’d need to gather signatures equal to 20 percent of the turnout for the last presidential election. That’s more than 20,000 voters.

Second, because the AOB is in an “Urban Renewal Area,” the supervisors can issue bonds for repairs and improvements without a public vote.  This was a new one to me, but very much in play, according to Finance Director Steve Tucker.

Again, a reverse referendum is possible with urban renewal bonds, and this time it would take 10 percent of the last general election’s turnout. That’s 10,000 signatures.

Third, they could use good old general obligation bonds and have a public vote, first. It would take a 60 percent vote for passage.

So does the county really have a chance of landing an I-Jobs grant?

 Sure, although the competition will be fierce. The state is already spending $46.5 million from the program on public facilities in Linn County. That’s a drop in the bucket compared to needs, I know, but it means that an AOB grant could face tougher sledding.

And if you believe that I-Jobs money should be spent on projects that both create jobs now and help the state build an economic infrastructure foundation for the future, like upgrading the power grid, then forking over millions of dollars to fix up the AOB is probably not on your priority list.

It’s also not on you list if you want to see flood mitigation or watershed management projects get bucks. Or public housing. Or mass transit. Or rail. Or any number of things on shovel-ready wish lists.

So if the I-Jobs bid fails, it’s back to bonding. And Barron said the board will not commit to any option now.

FEMA is willing to kick in at least $2.2 million and perhaps more to repair the building. But it won’t pay for the whole expansion project. The gap is what’s at issue.

Also new today, Garth Fagerbakke, county construction director, said that buying and remodeling the county’s current temporary home, the former Steve & Barry’s store at Westdale, would cost in the neighborhood of $14 million. He bases that on a $3 million purchase price and $100 per-quare-foot remodeling costs for the 110,000 sq. ft. building.

That’s not a definitive estimate, however. No comprehensive assessment has been done.

So, bottom line – voterless bonds are only one option being considered. And there’s a chance the Big Lug’s big program will solve the debate for us.

If it doesn’t, we’ll be back to the pivotal question — if expanding the AOB is such a great idea, why not let the people vote on it?

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