The Brown County Council has approved the first step in the process to borrow up to $3 million for road work, county-owned buildings and other capital projects.

County commissioner Diana Biddle presented the resolution to the council on June 21. The county has been borrowing $2 million every two or three years for capital improvement projects. The last such loan they took out in 2018 is set to be paid off within the next month. The interest rate is not to exceed 3 percent.

“With the rate being so low, it’s a pretty good bet that the tax impact will be tax neutral. This one should just pop in right as our other one is going off,” Biddle said.

An ordinance approving borrowing the money will be presented to the council next month. The council will meet at 6:30 p.m. Monday, July 19 and public input will be accepted about the loan at that time.

The commissioners will also have to adopt a resolution before the financing can be finalized. That will happen sometime after July, according to a timeline from law firm Barnes and Thornburg.

What’s it for?

Biddle said borrowing $3 million instead of $2 million is being suggested since interest rates are “exceptionally low” and some of it could be used for bridge projects and road improvements. Severe flash flooding the weekend of June 18 peeled asphalt completely off the decks of five bridges on Bear Creek Road and Clay Lick Road, Biddle said.

“The worst structural damage was on Bear Creek and we didn’t discover it until after 3:30 in the afternoon on Saturday because no one called to report it. They posted it on Facebook, but no one called the sheriff’s department to report the damage,” Biddle said. She said posts in groups like “Brown County Road Conditions” are not reported to the commissioners.

“With the five bridges damaged over the weekend, that will eat up close to all of that (extra $1 million),” Biddle said.

Other projects Biddle said she would like to fund with the remaining $2 million include upgrading the 911 dispatch center at the Brown County Law Enforcement Center. “That hasn’t been done since we built the jail,” she said.

“It is a pretty major undertaking and that will include antennas and radios for the highway department, so our highway department trucks will have GPS. Mike (Magner, highway superintendent) will have a computer program where he can see where the trucks are when plowing snow and mowing.”

Biddle said she had a list of other projects, but that has not been made public yet.

Another possible use for this new round of borrowed money is to buy the Brown County Career Resource Center building from the school district for $445,000 or another agreed-upon price. Negotiations are ongoing. The prosecutor’s office would then be moved to that building.

Taxpayer impact?

Council member Scott Rudd expressed concern about approving the resolution allowing the commissioners to further finalize the details of the loan since it was not listed on the agenda shared with the public ahead of time.

“It also went from $2 million to $3 million,” Rudd said.

“I’m leaning towards just pushing this back. I am reacting to the extra million as we speak. … It’s a lot of changes without a lot of notice.”

Biddle said if the timeline is pushed back and the resolution was not approved that evening, then funding would not be available until September or October instead of in August, which was when the loan was supposed to be closed per Barnes and Thornburg’s timeline.

“We’re not approving $3 million. We’re just saying get it started,” said county council President Dave Redding.

Biddle said since the resolution states that the principal amount should not exceed $3 million, the council could dial back the amount borrowed to make sure it does not impact the tax rate. “This is a determination to issue notes, which says the need exists. You’re recognizing the need exists,” Biddle said about approving the resolution.

Biddle said the “worst-case scenario” is that the tax rate would go up by one penny per $100 of assessed property value due to the extra million being borrowed, but those numbers will not be known until an interest rate is set.

Rudd said he would like to see a “whereas” added to the resolution that states, “whereas the council has no intention of raising taxes and this amount will be reduced to reflect that.”

“If we have to reduce the amount we’re asking for in order for that to happen, then we just won’t have as much money to give to the highway department,” Biddle said.

Veronica Schilb, the county’s attorney, was not available by phone and did not attend the Zoom meeting to answer Rudd’s questions about adding to the resolution Rudd’s proposed “whereas.”

“I think we could just say, and this is just my opinion, that this should be tax-neutral. We’re not saying tonight we’re raising taxes. We just got this tonight,” Rudd said.

Critser said that if the council wants to get anything done in the county, taxes may have to be raised.

“You’re going to have to say, ‘I will raise taxes.’ I’ve said that every damn year that I have ever been here, but we have done it only to help Brown County,” he said.

“If you want to get the bridges fixed, if you want to get the 911 upgraded to where they don’t have problems, which one mistake is a life, let’s go up a penny to save this life. … I will go up that penny to save that life.”

Rudd said his problem was not knowing the impact on taxes before approving borrowing the money.

“I hear you’re saying which project you’re looking at. You have a list. I don’t have that list,” he said.

Redding said the council will better be able to understand what this loan will do to the tax rate once county department budget requests and projections are received before budget hearings in August.

“You can take other expenses down to net this term to be tax-neutral,” he said.

“I think we can achieve your goal of making this tax-neutral. If it was $2 million, I wouldn’t be blinking, but you raised it to $3 million.”

Biddle said they decided to borrow more due to the low interest rates.

“There’s that mentality out there, but at the end of the day, there’s a lot of people with fixed incomes that can’t take any more,” Redding said.

Rudd also noted that the county is set to receive more federal COVID-19 relief funding, too. “The 911 system, to Dave’s point, I agree, that’s deferred maintenance there and we have to fix it. It doesn’t matter where the money comes from, it has to be done, but I just want to make sure all of those pieces, we can see them, we know what we’re doing, we’re not over-borrowing, etc.,” Rudd said.

Rudd motioned that the county council was not considering raising taxes, but would like to move the resolution forward. That was approved unanimously.