Sequestration likely to impact taxable bonds subsidy payments
Sequestration could impact Dublin, but it won't break the bank.
Dublin Finance Director Angel Mumma last week told Finance Committee members the impact of sequestration upon the city will likely be limited to bonds.
The $1.2 trillion in federal cuts that resulted from no movement in Congressional fiscal cliff negotiations went into effect March 1.
Sequestration will impact subsidy payments on taxable bonds the city uses to finance construction and other infrastructure projects.
"It's not going to make or break us," Mumma said.
In 2009, Dublin issued bonds including $11.69 million in Build America Bonds for Central Ohio Innovation Center Improvements that included the relocation of Industrial Parkway, improvements to state Route 161 and the construction of the Darree Fields storage tank, a staff memo to council stated.
An 8.7-percent cut is expected in subsidy payments and Dublin was expecting two such payments of $101,898 in 2013. The cuts are expected to take about $8,800 from each subsidy payment, staff reports said.
Dublin does have the option of refunding the bonds, Mumma said.
"It does seem to make sense," she said of refunding the bonds. "Even if this does get resolved, how will it be next year?"
Dublin plans to issue bonds this year for the construction of the final phase of Emerald Parkway and Mumma said staff will look at refunding the Build America Bonds then, if a reduction of interest costs can be acquired.
"We're going to the bond market for a number of projects," she said. "We will certainly look at this and see if it makes sense then."
In other news, the finance committee recommended a $16,000 grant for the Dublin Arts Council to Dublin City Council, who approved it April 8.
The DAC applied for the grant as part of the Hotel/Motel Tax Grants last year, but the finance committee requested additional information.
The DAC requested $16,000 to help fund a community research project.
"The Dublin Arts Council must answer critical questions to move Dublin forward," DAC Executive Director David Guion told the committee, adding that research would make the DAC more competitive in gaining federal grants, especially those from the National Endowment for the Arts.
The DAC plans to use an Oregon-based firm to help research, although it will also use information from surveys conducted by the city.
The DAC also plans to put $13,000 into the project.