Meridian City Council members on Tuesday discussed a potential bond issue to pay for paving city roads. The $6 million bond would be the second half of a $12 million bond plan approved by the council in June 2020.
The council, last year, approved borrowing $12 million to go toward paving, crosswalks and upgrades to traffic signals. However, only $6 million in bonds were issued with the other $6 million being held back for future consideration.
Bond payments for last year’s $6 million bond are made from the city’s share of the Internet Use Tax. The city is projected to receive about $2 million in Internet Use Tax for fiscal year 2022, which would be enough to make the bond payments on both $6 million bonds.
Ward 1 Councilman and Council President George Thomas told the council that low interest rates were projected to rise. If the additional bond was to move forward, he said now would be the time to do it.
“If we wait, the possibility of ever getting this type of interest rate again is slim,” he said.
Mayor Jimmie Smith said he thought the bond issue was a good idea. With the low interest rate and the ability to get a large paving project done, he said it would end up being less expensive to the city than waiting.
“I would encourage the council to do it because it’s going to save money in the long run,” he said.
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Public Works Director David Hodge said the city’s paving index rated the overall condition of city roads as a 61 out of 100, which was considered fair condition. According to the study, the city would need to spend $65 million to fix every road or have an annual budget of $6.4 million to maintain the city roads’ current condition.
If the city doesn’t pave anything, Hodge said, the study projects the city’s road score would drop to 41 out of 100 and cost about $84 million in deferred maintenance by 2026.
Public Works also has about $350,000 to purchases asphalt for in-house paving projects and about $1 million to spend on contract paving, Hodge said. In-house paving is ongoing, he said, with projects being done as time and weather allow. Contract work will need to be bid out and likely wouldn’t begin until next year.
No action on the bond issue was taken during the work session. The city council plans to revisit the issue in a regular meeting.