Verndale gets good financial news on sewer and water project
The city of Verndale was to find out how much it would have to borrow to complete this year's sewer and water improvement project. The answer? Zero.
That was the good news brought by Traci Ryan, a representative of financing company David Drown Associates, at the June Verndale City Council Meeting. Ryan said out of the total project cost of $753,493, more than half will be covered by grant money. The city will only have to come up with about $61,943 to finance the project, an amount that can be covered by the reserve funds.
Homeowners who benefit from the project will be assessed $228,212.
Ryan said the city has $90,000 in the water fund in cash and investments, and $130,000 in the sewer fund. She said it would be smarter to draw down those funds to pay the $61,943 owed, because issuing bonds for such a small amount wouldn't be prudent.
"It really doesn't make sense [to finance] because of issuing and finance costs," Ryan explained.
And she didn't think drawing down the accounts would hurt.
"You still have some pretty healthy reserves in those accounts," she said.