Discussions to use one-percent funds as leverage for infrastructure bonds are apparently back on the table.
Mayor Chokwe Antar Lumumba recently told the one-percent oversight commission that he would like to issue up to $30 million in road repaving bonds and repay the debt with a portion of infrastructure tax revenues.
“It would allow us to pave at a more significant pace and have money for the future,” he said.
Plans are to use half of one-percent revenues to repay the debt, while saving the remaining dollars for other projects and emergency needs.
“Our debt coverage ratio is two times what we’re seeking,” he said. “We’re not going to leverage away our future.”
The tax generates about $14 million a year.
There is no time frame for when the bonds would be issued.
Informal talks were held at the commission’s February board meeting.
The commission was put in place to oversee how Jackson spends the one-percent funds.
In the past, oversight members have been opposed to the idea of leveraging temporary money for long-term debt. The tax was implemented in 2014 and is slated to expire in 2034.
However, at least one member seems amenable to the discussions.
“I’m always willing to have a conversation, but I would have to be swayed,” said Commissioner Jonathan Lee.
Lee would like to see movement on millions of dollars in projects previously approved by the commission that have not yet gotten under way.
Through February, the tax had generated a little more than $69 million, of which $60 million had been obligated to projects. Of that amount, $48 million had been spent, city records show.
Documents indicate for the current fiscal year alone, work had not been allocated on 15 projects, despite some $3 million being allocated for the work.
“We still have quite a bit of one-percent funds obligated that have not actually turned dirt,” he said. “I would love to focus on those, rather than go out and borrow money for projects that might not get through the pipeline.”
Chief Administrative Officer Robert Blaine, a member of the commission, points to the progress made. “There’s a good bit of work happening all over the city. The pace of executing projects has greatly increased.”
Thirteen projects included in the first-year master plan, which was approved in 2015, have been completed. Engineering and design work has wrapped up on another six.
Work is also finished on a $9.8 million neighborhood street repaving project and on a $4.7 million major thoroughfare overlay project.
“There are projects in every ward that have been announced, so I’m looking forward to all of them being done,” Lumumba said.
