Arenac County approved for infrastructure bond
ARENAC COUNTY — Last week, Arenac County was approved for a $3 million infrastructure bond through the American Recovery and Reinvestment Act of 2009 (ARRA).
According to Arenac County Treasurer Dennis Stawowy, the bond is eligible to be utilized on any project in the county’s jurisdiction up to $3 million. He says the federal government will subsidize the interest on the bond.
“For example, on a 20-year loan at 5-percent interest for $3 million dollars, there would be almost $2 million in interest over 20 years,” he said. “The [federal] government would pay almost half of that interest; so there would be about $1 million in savings.”
Stawowy says there are also a couple of strings attached to the bond.
“As there is with any government loan, there’s a few strings attached,” Stawowy said. “First, the job has to pay [laborers] a prevailing wage, which means on a union scale.
Secondly, the interest wouldn’t be tax-exempt as it would be if you were borrowing money from a bank.”
Stawowy says the bond, despite having restrictions, is still enticing and that how it will be used is entirely up to the county commissioners.
“Every county in the state received this same kind of bond,” he said, adding the deadline to use the bond isn’t until later next year.
He says if counties don’t use all of the monies granted, they’ll have the option to give the excess to the state.
“They (state) could then use it for a highway project or something like that,” the treasurer said.
One project immediately crossing the commissioners’ minds was the AuGres River Drain Project set to begin soon by the Arenac County Drain Commission.
Currently, the drain project, which Arenac County Drain Commissioner Larry Davis says will cost about $620,000, is scheduled to be paid for by an assessment increase to residents in the river’s drainage district, which includes five townships, AuGres City and the villages of Turner and Twining.
“Some of it (assessment) doubled, some of it tripled,” Davis said, adding aboard of review session was held to discuss the assessment hike.
“The drain commissioner wasn’t interested in using prevailing wages for the project,” Stawowy said. “He figured it would drive up the interest for the project (which would leave more money to be paid out-of-pocket by affected residents).”
Stawowy suggests a different project in the county that could utilize the bond is the proposed Omer sewer project, which has the city seeking a United States Department of Agriculture (USDA) rural development grant to install a sewer collection system and treatment facility.