City okays refinancing deal for City Hall Agreeable rate from Classic Bank brings relief for council
By KEN ESTEN COOKE
Reporter Publisher
After fretting over a $575,000 balloon note that was coming due next year, city council members jumped on a refinancing deal from a Milam County bank that won’t cost them much.
Classic Bank offered three options and the city agreed to a 4.36-percent, fixed-rate loan with a 15-year term. After 10 years there is no early payoff penalty.
“The intent was always to re-finance,” said Jennifer Douglas of First Southwest, the city’s financial advisory company. “In 2002, the market was such that no lenders wanted to go beyond a 10-year note when this was originally financed.” She advised the council to avoid any deal that wouldn’t lock in a rate on a 15-year note.
Present and past council members had taken some heat for the deal, but the new financing brought smiles all around.
“Last year, we paid around $60,000 on the note, but next year it will be about $48,000 and it won’t go above $60,000 for the loan term,” Douglas said.
The loan term brought relief to the council, which is struggling to find funds to cover a shortfall in payments for the city’s new sewer plant, and begin to make inroads on major water infrastructure needs.
The city received two other offers from out-of-county banks. Citizens National Bank, which sold the property to the city in 2002, did not submit a bid.
Calculated tax rates
The city accepted the effective and rollback tax rates, as calculated by Doug Bryan, Milam County tax assessor-collector.
Rockdale’s total assessed value was $185,302,712, with a net taxable value of $183,249,691. Of 4,012 parcels, only one was under protest.
Rockdale’s effective tax rate (which raises the same amount of revenue as the previous year) is 51.7 cents per $100 valuation. The rollback rate, which subjects the city to a rollback election, is 55.9 cents.
The current city tax rate is 53.1 cents.
The council continues to work on its budget and will adopt a tax rate upon approving the budget, Interim City Manager Randy Holly said.
Sewer plant
KSA Engineers’ Division Manager Stephen Dorman told the council that recent problems at the new sewer plant were due in part to last year’s wet weather and possibly faulty work by the manufacturer involving the “drying beds.”
“The problems were documented prior to the one-year warranty period,” Dorman said. “We plan to do a complete evaluation of the plant before the re-permitting process.”
Dorman said designers and the original manufacturer, Gravity Flow Systems, assumed more sludge could be processed during wet weather periods.
The council later tabled a measure to accept septic tank waste at the sewer treatment facility, pending establishment of rules.
David Akin, wastewater treatment plant operator, told the council it would not add further problems as septic tank waste was 98-percent liquid.
“It’s a drop in the bucket to what we treat now and it will not affect the plant adversely,” Akin told the council. “But we will have to have stringent and specific rules. We don’t want to accept drilling mud, grease traps or anything that could hurt the plant.”
Akin and Mayor John Shoemake said accepting septic waste could help with the problem of illegal dumping in the town’s manholes. The nearest places to dump septic waste are in Hearne and Belton.
Shoemake commended the department for looking for new revenue possibilities.
‘Preserve America’
The city also passed a resolution allowing the historical society to submit an application designating the town as a “Preserve America Community.”
Spokesperson Dr. Lucile Estell said this would allow non-profits in town to apply for grants, enhance the presence of our city and become part of a movement to preserve the country’s heritage.
The council also:
• Tabled a waiving liens, pending cleanup by the new owner on a Baxter Street plot.
• After an executive session break, the council took no action on a personnel matter.
• Heard the city’s street sweeper will soon be back after recent electrical problems.
