Lower Pottsgrove Looks Ahead to Bond Sale Financing
LOWER POTTSGROVE PA – “Hope for the best, plan for the worst.” That seems to be a state motto the Lower Pottsgrove Board of Commissioners must heed as it prepares to approve, during its Thursday (Dec. 17, 2020) meeting, the sale of $9 million in bonds to finance construction of the township’s proposed municipal campus at East High Street and North Pleasant View Road (at top).
Under best circumstances, the bonds might attract a very low interest payment rate (somewhere in the range of 2 percent) and attract investors willing to pay for the privilege of taking on what amounts to the township’s 30-year mortgage, according to Jamie Schlesinger, Lower Pottsgrove’s financial consultant.
“I expect a very strong appetite” for the general obligation bonds, he confidently told board members during their Dec. 7 (Monday) session. The sale is tentatively planned for January.
Under the worst, the interest rate could balloon to more than twice that amount, 5 percent, and appeal to a limited number of buyers. Schlesinger – who represents PFM Financial Advisors LLC, the firm hired to handle the township’s financial needs in the campus project – assured commissioners that’s not likely happen.
Pennsylvania regulators, however, demand Lower Pottsgrove’s bond sale filings and public notices reflect a range of possible outcomes … and not just the low cost of financing the board anticipates it will obtain. So a legal advertisement published Friday (Dec. 11) on the township’s behalf shows it potentially could sell a maximum of $10.75 million in bonds – a worst-case scenario – to get the campus built and other tasks accomplished.
“It’s goofy, and it’s impossible for this to ever happen,” Schlesinger claimed, but it nonetheless must be publicly presented for the state to allow the bond sale to proceed.
The board voted 4-1 to advertise the sale as required by law, with Commissioner Michael McGroarty in opposition. McGroarty over several months has said he considers the building cost too high.
What the bond sale would pay for
The total project would create a roughly L-shaped facility of 15,700 square feet that houses the township administration, its growing police department, and public meeting spaces. A 4,800-square-foot basement, a secured area for lockers and evidence storage, and a thin stone exterior veneer are part of the package. It includes ample parking on the busiest corner in Sanatoga village, as well as available land on which to grow if needed.
The building was last estimated by architect Alloy 5, during the board’s Nov. 2 meeting, to cost $8,340,214, including a $739,000 contingency fund for unexpected surprises, if any, that could arise in the work.
Board members expect they will eventually sell the existing township building on Buchert Road, which they and former commissioners generally agree government operations outgrew five or more years ago.
The $9 million target amount was set by the board, Schlesinger said, and it’s not for the campus project alone. The legal advertisement states the sum is intended to cover:
- Construction costs of the building at 2250 E. High St.;
- Purchase of equipment for the public works department and the police department;
- Repair of bridges in the township (none are specifically named); and
- Costs of issuing the bonds, “or any or all of the same as determined by the president or vice president of the township commissioners.”
Want to comment on the proposal? Here’s how
Because of Gov. Tom Wolf’s latest coronavirus restrictions, the township announced Monday (Dec. 14) it would discontinue in-person meetings at Sunnybrook Ballroom, and instead conduct its Thursday meeting in a virtual format, online. A legal advertisement about the change also states:
“Public participation at this meeting shall be limited to remote access, via computer, tablet, smartphone, or phone. This will allow any member of the public to indicate they would like to speak and offer comment during the public comment portion of the meeting. Members of the public who wish to participate or listen to the meeting may call-in or log-in. Directions for connection(s) to and participation in the meeting will be published” on the township website.
Editor’s note: This story was edited Monday (Dec. 14) at noon, for clarity, to enhance readability, and to add a link to a source document.
Photo by The Post