During a Special Council meeting Wednesday night the Common Council approved a 22-23 year debt restructuring package.
According to Ald. Jamie Giantonio, the number of years will be decided at issuance.
John Healey of Mesirow Financial Services, the City’s financial advisor, gave a presentation explaining the difference between the 22 or 23 year debt.
A 22 year package would be $63 million and 23 year plan would be about $70 million.
“It is a value judgment for all of you. Is paying that $7 million and getting a relief in the middle years worth $7 million? I tend to think the 22 year option makes more sense,” said Healey. “We are here tonight for a not to exceed authorization to require us to sell $90 million or thereabouts in bonds.”
On March 17 Mayor Erin Stewart, Healey, Ald. Robert Smedley, Eva Magnuszewski and Carlo Carlozzi had a meeting. The leadership group had several items that they wanted in order to pass the debt restructuring said Magnuszewski in an email to the City Journal. The leadership group reached an agreement and it was sent to the Democratic caucus for approval.
The entire process began in January. If the restructuring was not done, then next year cost of bonds would have increased to $29.188 million. The following year the city would owe $36.373 million. In 2021 the debt bill would be $39.357 million, according to the Mayor’s Office.
Savings was to be accomplished by restructuring the existing principal and interest payments and amortizing, or reducing, them until later years.
There has been much controversy, between the two parties surrounding the issue, as several meetings were canceled or held without the full council.
On Jan. 17 at 5:28 p.m. Democratic Councilman Richard Reyes canceled a bonding meeting planned for 6:30 p.m on the same day. Meanwhile, Mayor Stewart refused the request and still held the meeting and the Special Council meeting planned following the bonding meeting. No one from the Democratic party showed up to either sparking outrage from many Republicans.
Then on Jan. 25 Carlozzi argued with Corporation Counsel on whether or not the last meeting was legal. Carlozzi claimed Smedley should not have led the meeting and that finance board members were allowed to vote and were not approved to do so by this Council.
Gennaro Bizzaro, of the Corporation Counsel, disagreed with Carlozzi. Carlozzi then promptly adjourned the meeting without discussing or voting on debt restructuring.
Since then a Council meeting on debt restructuring was not held until Wednesday night.
Healey said it could take a month or more for the process to be completed.