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Columbia County refinance expected to save millions on debt repayment

October 19, 2018 GMT

By refinancing part of the $45.5 million debt for Columbia County’s biggest-ever building project, the Columbia County Board on Wednesday saved taxpayers millions of dollars.

That’s the assessment of Jeffery Belongia, of Milwaukee-based Hutchinson, Shockley, Erley and Co., who has long worked with Columbia County officials on matters related to borrowing.

With the County Board’s unanimous approval Wednesday of refinancing $14.9 million, Belongia said, Columbia County will save between $5 million and $7 million in avoided interest costs, and will likely pay off the debt at least three years earlier than its 20-year life.

“This is a beautiful building, whose life will extend well beyond when you finish paying for it,” Belongia said at Wednesday’s County Board meeting, held in the boardroom of the year-old Administration Building.

On Nov. 12, 2014, the County Board voted 23-3 on an “intent to bond” resolution for an array of building projects — principally, the construction of the Administration and Health and Human Services buildings on opposite sides of the Portage Canal and remodeling of the Columbia County Courthouse for court-related uses only.

The Admin building, 112 E. Edgewater St., has been in use since June 2017, and workers from the Department of Health and Human Services moved last summer to the HHS Building, 111 E. Mullett St. — about the time when the court-related offices returned to the courthouse, after using the HHS structure as a temporary location for a little less than a year.

By refinancing, the County Board is not borrowing any additional money, for the building project or for anything else, Belongia emphasized.

Rather, he said, it’s getting a jump start on paying down the principal of the $45.51 million, which the County Board borrowed in February 2015 ($10 million), February 2016 ($18 million) and November 2016 ($17.51 million).

And, with an interest rate on the refinancing of 3.32 percent, the cost to taxpayers is actually a bit less than county officials had promised when they took on the building project debt. Belongia noted that the County Board had vowed the mill rate for debt service would not exceed $1.80 per $1,000 assessed valuation; with the refinancing, the mill rate for repaying the borrowed money is about $1.72 per $1,000 evaluation.

Supervisor Kevin Kessler of the town of West Point asked why county officials couldn’t charge the full $1.80 per $1,000, and still keep their promise to taxpayers but pay down the debt even faster.

County Comptroller Lois Schepp said the lower debt service mill rate is due in part to an increase in the county’s equalized assessed valuation.

However, she said, Columbia County may have to borrow money in 2019 to pay for required upgrades of the 911 system at the Columbia County Sheriff’s Office, although the extent of the upgrades that might be needed, and their cost, are still unknown.

County Board First Vice Chairman Dan Drew of the town of Pacific — who also is chairman of the County Board’s Finance Committee — said the refinancing of the existing debt is a good deal for the county and its taxpayers, even if more borrowing is necessary soon.

“We’re never going to have another building project, I can’t imagine, of this magnitude in terms of dollars and center, maybe ever,” he said.

In other business, the County Board welcomed its newest member — Christopher Polzer of Poynette, who will fill the remaining 18 months of the term vacated with the recent resignation of Andy Ross of Poynette.

The County Board unanimously ratified the Executive Committee’s recommendation to appoint Polzer to the seat representing District 17, whose boundaries lie entirely within the village of Poynette.

After taking the oath of office, administered by Judge W. Andrew Voigt, Polzer introduced himself to the County Board, and spoke of how his parents instilled in him the obligation and commitment of community service.

Polzer was appointed to the County Board’s Public Safety and Solid Waste committees.