To: Martin L. Cousineau, Finance Committee Chairperson
From: Jeffrey Wright, Drain Commissioner
title
RE: Approval of the Kearsley Creek Grandview Branch Drain Note in an amount not to exceed $205,000.00; the cost of this Note will be paid by special assessment of the drain district
recommendation
BOARD ACTION REQUESTED:
The Genesee County Drain Commissioner has determined that there is a need for the construction of improvements to the Kearsley Creek, Grandview Branch (#1702). The estimated total cost of these improvements is $205,000.00. To reduce costs to the district, it has been determined that it would be in the best interests of all parties if Genesee County purchases the Drain Note. The current annual percentage rate that Genesee County is receiving for cash investments is 3.5% and that amount will be used for the interest rate on the note. The Note will be paid back over Ten years.
BACKGROUND:
Drain Projects pursuant PA 40 of 1956 the "Drain Code " have to be financed and paid back through special assessments. In the past we have borrowed from Genesee County for other projects and ask for approval to do so again.
DISCUSSION:
In the current environment, many banks have been asking for full faith and credit on all borrowings not just large bonds. Drain districts pay for the borrowings through special assessments and are very safe. Loaning the Drain district the money for this project is a tax-free way for the County to earn interest on unused funds and benefits all.
IMPACT ON HUMAN RESOURCES:
No impact on Human Resources
IMPACT ON BUDGET:
Money will be borrowed and paid back with interest over 10-years
IMPACT ON FACILITIES:
No impact on Facilities
IMPACT ON TECHNOLOGY:
No impact on Technology
CONFORMITY TO COUNTY PRIORITIES:
Drain Projects promote safe communities and by borrowing from the County, the drain district is able to avoid costs associated with public finance bidding.
resolution
TO THE HONORABLE CHAIRPERSON...
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