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Published 4 years ago
Last updated 4 years ago
Homewood village government will consider selling up to $1.9 million in bonds to finance capital projects.
A public hearing will be held June 27 at 7:30 p.m.
Finance Director Dennis Bubenik said the state allows non-home rule municipalities like Homewood to issue general obligation bonds no larger than 0.5 percent of equalized assessed value without a referendum. Homewood did so in 2002, 2006, 2010 and 2014 to pay for infrastructure and capital equipment.
A new engine for the fire department is the biggest item on the list of proposed expenditures that the bond issue would cover. The fire engine, according to a village estimate, would cost about $650,000.
The bond issue would also pay for new finance department software, estimated at about $250,000 and fund $100,000 in improvements to the Homewood Science Center.
A list that includes 13 other projects was included in a memo to the village board this week from Assistant Finance Director Amy Zukowski. The total estimate of the list is $1.6 million. The extra $300,000 would cover the village in case the estimates were incorrect.
“In the world of bond issuance, $1.6 million is considered a small bond,” Bubenik said.
The bond, if approved, would be issued via private placement, Bubenik said. With private placement, a bank buys the bond and holds it as an asset on its books.
“The village of Homewood debt is considered good as gold,” Bubenik said. “So, there should be plenty of banks that are interested in looking at our debt.”
Homewood’s 2010 bond was given a AA rating by Standard and Poor’s.
Bubenik said Homewood used private placement in 2014 and the village saved about $26,000 on issuance cost. That money was turned over to purchase more capital equipment.
Zukowski’s memo contained a timetable for the bond issuance process. The village is expected to finalize the sale on August 31.
At the May 23 board meeting, the 2016 tax levy was amended to $576,000 in bond principal and $9,012 in bond interest. Bubenik said he made an error that has already been corrected by Cook County.
That debt is expected to be paid off by Dec. 1.