County working on financing jail
Firms pitch funding possibilities
What happened: Mower County Board interviewed three financial firms Tuesday for possibly hiring to help the county borrow millions of dollars for its proposed justice center in downtown Austin.
Why it matters: Board members have said they want to borrow or bond up to $27 million for the proposed $30 million project.
What’s next: The board expects to discuss the options and select a firm June 24.
By Tim Ruzek
Mower County leaders are moving forward with the process of borrowing up to $27 million to finance most of the justice center in downtown Austin.
In its hunt for low interest rates through bonding, the Mower County Board interviewed three financial firms Tuesday, spending more than an hour hearing details on what each could provide and ways of handling the project’s financing.
In August, the board voted 3-2 to bond up to $27 million for the justice center, with board member Dick Lang and Dave Tollefson opposing it for being too high. The same vote followed for a $30 million overall spending cap only for the justice center, possibly including up to $3 million in reserve county funds.
Mower County hasn’t bonded for a project in a long time, officials said, but no one recalled when the last time was.
Two public-financing firms — Springsted, of St. Paul, and Ehlers & Associates, of Roseville, Minn. — interviewed before the board.
Northland Securities, a Minneapolis securities brokerage firm that works with public and private entities, pitched different financing approaches for the county. Northland officials said the county, through "creative financing approaches," possibly could create $1.5 million to trim the bonding amount or add work to the project.
There’s no guarantee with the additional money, county Finance Director Donna Welsh said afterward.
County leaders plan to compare the services and fees for the firms, which all reported experience in financing justice centers. Board members plan to discuss and possibly vote on a firm at its June 24 meeting, Welsh said. That firm would start the process of helping the county decide when to let for bonds and for how much, she said.
Officials said the county has little debt, Welsh said.
The county, under state limits, could borrow up to $91 million based on its tax market value, Welsh said.
County Coordinator Craig Oscarson mentioned in one interview Tuesday the possibility of a 30-year bond for the justice center. It would make the project more expensive overall, he said, but would create a smaller annual expense.
In April, the project’s architects gave preliminary cost estimates for the justice center, showing the facility costing roughly $32 million. That figure doesn’t include another $817,000 for the cost of a geothermal heating-and-cooling system for the facility if the board opts for that rather than a conventional system.
The justice center is planned to have a 128-bed jail with courtrooms and other court-related offices.
Oscarson said on Tuesday the board is trying its best to keep to its self-imposed $30 million spending cap.