WATERTOWN, N.Y. (WWNY) - Watertown Mayor Jeff Smith sees a new city council as an opportunity to revisit how the city pays for the Thompson Park Pool and bathhouse.
He’s proposing a bond ordinance to lower the amount coming from the city’s fund balance.
“It’s a way to pay for some of it upfront, through cash. And some of it through bonding, which is low interest bonding,”said Smith.
The ordinance calls for a bond of $1.6 million, which is about half the cost of the project.
The rest of the$3.1 million will come from the fund balance and a New York State grant.
Smith says this plan makes the most financial sense.
“There’d be some finance costs, but we’re borrowing money on bond notes at anywhere from 3-4 % interest, 5% is high. So, we’re deferring some of that cost now, but not draining down our reserve fund," said Smith.
In August, Councilwoman Lisa Ruggiero voted in favor of amending a bond to help fund the project, which was ultimately rejected.
This led to the pool and bathhouse being paid for by the reserve fund.
Ruggiero says paying out of pocket, will save the city money in the future.
“We’re not going to have the long-term debt associated with a pool. By bonding, we still will have 10 years worth of debt, the interest on it, and the expenses to bond. So really, by doing what we’re doing, we’re saving money in the long run,” said Ruggiero.
The city would be responsible for paying back the money it borrows. But, some council members in favor of the bond say it’s worth it to protect Watertown’s bond rating.
“Anytime your general fund goes down, your ability to borrow money comes at a more expensive rate. So, by depleting our general fund we put ourselves in jeopardy of having our bond rating lowered,” said council member Jesse Roshia.
Mayor Smith says this could raise the cost of future city projects.
“When you’re talking millions and millions of dollars, that drop in bond rating, and increase in your interest rate has a big impact on the city budget," said Smith.
The bond ordinance needs four votes in favor to pass.
At this point, Smith and council members Jessie Roshia, and Sarah Compo say they support the bond.
Council members Ruggiero and Ryan Henry-Wilkinson say they are leaning towards voting against it.
The discussion will continue when council meets Monday at 7 P.M. at City Hall Chambers.