City set to take on new debt
Appeal Staff Writer
Carson City is poised to take out $24.5 million in new debt for a bevy of upcoming projects totaling an estimated $26 million, but, according to city officials, taxpayers won’t notice anything in their bills.
Money to pay off the bonds, which will wind up costing nearly $53 million over the next 28 years, will come from revenue freed up by the city paying off existing debt and from some of the city’s investment bonds that will soon be ready to cash in.
The city will also collect rent from office space in a proposed health services building on Long Street, which it plans on buying from Carson-Tahoe Hospital as soon as the hospital’s new building is ready to house the C-TH rehabilitation center.
“There will be no net increase in the tax rate because of this,” said Carson City Finance Director Tom Minton.
About $12 million will be slated for the new sheriff’s building, along with another $1 million to tear down an existing building to make room for it, while $8 million is targeted for citywide upgrades in equipment and facilities. The other $5 million is slated for purchase of the hospital’s rehabilitation center to house the multi-purpose health services building.
The city has about $2 million in cash to contribute to the projects.
Concerned with the impact of the new property tax cap, Supervisor Shelley Aldean wondered aloud whether the debt plan could withstand a slower than expected growth in the city’s revenue.
“Have we prepared for the worst-case scenario?” she asked.
Minton answered that the financing plan was drawn up with a projected 1.5 percent annual revenue growth; the new cap holds property tax increases at 3 percent a year.
The payment plan calls for the city to pay $672,500 next year and between $1.5 million and more than $2.5 million annually for the following 27 years.
Carson City supervisors have not yet issued the general obligation bonds, but on Thursday they unanimously approved a resolution stating an intent to do so.
– Contact reporter Cory McConnell at firstname.lastname@example.org or 881-1217.