A bond sale by St. Clair County is still pending as the county looks for lenders to buy the county’s bonds.
The St. Clair County Board on Tuesday night authorized County Board Chairman Mark Kern this week to finalize the restructuring of debt the county took on for the construction of MidAmerica Airport.
A sale is expected this week.
The bond sale was not completed on Tuesday as planned. A delayed bond sale in Chicago, which has a junk status bond rating, has led to other municipal bond sales in the state to be delayed, Kern said.
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“(There) wasn’t much time to educate people that the county is double A, it’s a much different case than Chicago,” said bond underwriter Ray Coyne. “People are just nervous about Illinois. Tomorrow we’ll try again to see if we could come up with a full set of buyers for your bonds.”
As part of the bond process, the county recently received a Aa2 rating from Moody’s and AA rating from Standard & Poor’s.
According to bond documents, current airport bonds are scheduled to mature in 2029. The county hopes to extend the repayment of the bonds over 30 years.
Coyne estimated the extending the bonds would lead to a total cost of $88 million in principal and interest over the 30 years. However this plan would allow the county to have relatively flat annual payments on the debt, rather than the current ascending payments. Those payments go from $150,000 in principal payment in 2016 to $4.5 million in principal payment in 2029.
Board members Fred Boch, Edwin Cockrell, Frank Heiligenstein, Craig Hubbard, Nicholas Miller, Michael O’Donnell, Stephen Reeb, and C. David Tiedemann voted against the bond sale authorization.
“How much more interest, if interest rates even stayed the same, are we going to end up paying for the extra 15 years?” Heiligenstein said during the meeting.
Interest rates on the current bonds range from 4.5 percent to 5.58 percent, according to county documents.
In March, the board authorized restructuring up to $39.8 million in bonds in order to help lower debt payments.
County officials opted to refinance the debt because of the possibility of income tax transfers from the state to municipalities being reduced by 50 percent.
Money to pay back the debt is set to come from passenger facility charges, grants from the federal government, revenues that come from the operation of the airport and related facilities and from the county’s income tax transfers distributed from the state.
In other action, the county board approved a contract with Perry County Construction to replace a bridge along Pensoneau Road in Fayetteville Township near Marissa. The contract for a little more than $239,000 was about $70,000 under the engineer’s estimate, said Jim Fields, county engineeer.
Work is expected to begin in July and be completed by the end of this construction season, Fields said.
He added people will be able to use Venedy Road to get around the the Pensoneau Road work.
The county board also approved the construction of a Dollar General along Eiler Road, outside of Belleville. STL Equities Managing Member Bob Elkan has said, the development company hopes to begin work by the end of June on the $1 million, 9,100-square-foot store.