Dillon to vote on financing for $2.2 million marina project
November 16, 2010
Dillon Town Council will vote today on an emergency ordinance to provide financing for a $2.2 million revamp of the Dillon Marina.
The ordinance requires a super majority vote of 5-2 to pass, but if it receives approval, it will not be subject to a second reading.
The ordinance was placed on the docket as an emergency to allow the town to close a time-sensitive financing agreement under specific terms and to allow crews to begin work on the project while water levels are low.
Town staff originally thought the project would carry a $2 million price tag, but the only bid the town received for the project came in at $2.6 million. Staff and council will attempt to pare pack the project by $400,000 to reach the $2.2 million mark during part of a worksession at 4:30 p.m. before Tuesday’s regular council meeting.
As part of the financing agreement, the town will issue certificates of participation using the town’s only asset that nears $2 million in value – town hall. Dillon will lease its town hall to UMB Bank, which will provide the $2.2 million to the town. The town will make annual payments for 20 years at a 4.65 percent interest rate with annual payments of $170,153 to the bank. UMB will then sell the certificates of participation to Alpine Bank, which will collect the principal and interest payments from UMB.
Dillon finance director Carri McDonnell said there is no chance the town could lose town hall as part of the deal. In a worst-case scenario, UMB could lease town hall to another party for the remainder of the 20-year deal, but the town would take possession of town hall back at the end of the contract.
“We are not selling or giving up ownership of the town hall,” she said.
The loan will be paid back entirely from marina revenues through the Marina Enterprise Fund, McDonnell said.
Marina manager Bob Evans said the town would like to begin construction on the first phase of the project in the next few weeks. Water levels in the Dillon Reservoir are lower than normal – around 14 feet according to Evans – making it an ideal time to begin construction. The first step in the process will include installation of a stormwater detention system.