JEFFERSON - The County Board of Commissioners voted Tuesday to give Medina County its allocation of Recovery Zone bonds totaling more than $17 million.
The bonds were offered states through the American Recovery and Reinvestment Tax Act and are classified into two subcategories: economic and facility. Ashtabula County’s allocation of economic development bonds was $6.9 million. For facility bonds, the allocation is $10.4 million.
Last month, the Board of Commissioners approved a resolution that would have allowed the Ashtabula County Port Authority to use these bonds to fund water infrastructure improvements for Ohio American Water (OAW). By offering the low-rate financing to the private water company, commissioners and the port authority members hoped to soften the blow for consumers the anticipated water-rate increases OAW had in process with the Public Utilities Commission of Ohio (PUCO).
Commissioners Board President Joseph Moroski said the deal, which would have involved the use of allocations to other counties as well, unraveled after OAW withdrew its request for the automatic increases to rates in 2011, 2012 and 2013. The utility sent a letter to PUCO Jan. 20, dropping its request. There is no other local economic development project on the table that met the requirements of the bonds.
Medina County Commissioner Stephen D. Hambley said Medina County had three projects in the works and could use the allocation. The county already had used its allocations to assist a fiberoptic network and retail project in Brunswick. Another private project, Chippewa Landing Resort LLC, could use the funding source. Hambley said the project involves construction of a resort and spa. The private developer is working with a port authority to secure the low-cost financing provided by the bonds.
“In some counties, there were not enough projects able to use the money in the short period specified,” Hambley said. “You have to issue the bonds by the middle of the year. We were fortunate that we had a couple of economic development projects ready to go.”
Moroski said the county’s bond counsel looked into using the bonds as a funding source for the lodge debt, but “he didn’t see it was a good fit at this point in time. They just weren’t suited for that,” Moroski said.
Moroski said rather than let the money go back to the state, Ashtabula County commissioners agreed to allocate it directly to the Medina County project. At least one other Ohio county also allocated its share to it.
“We would have borrowed more money, and we’re not in a position to borrow more money,” Commissioner Daniel Claypool said during the public-comment portion of Tuesday’s meeting.
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