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HomeMy Public PortalAbout1997/09/16 September 16, 1997 An Infonnal Meeting of the Mayor and Council of the Borough of Carteret was called to order by Mayor Peter J. Sica on September 16, 1997, 6:30 P.M., Municipal CourtlPolice Facility, 230 Roosevelt Avenue, Carteret, New Jersey. INFORMAL MEETING The following were noted present: NOTED PRESENT Mayor Peted. Sica Councilmember Bialowarczuk " DuPont " Failace " Fazekas " Gutowski Also noted present was Borough Attorney Craig Coughlin and Patrick DeBlasio, CFO. Noted absent was Councilmember Feingold. Statement of Meeting Notice was mailed to The Home News Tribune, The Star Ledger, and posted on the bulletin board on September 12, 1997. STATEMENT OF MEETING NOTICE The purpose of the meeting is to discuss the purchase of a Fire Truck, architectural plans for the proposed library and various personnel matters. PURPOSE OF MEETING Patrick DeBlasio said there are three different ways of financing the project. We can go with the MCIA, issue Bonds or we can issue a one year note for up to ten years. If we go with the Bonding the Borough of Carteret will have to hire a bonding attorney. (He than listed the cost of the one year note). They will charge anywhere fi'om $350.00 to $400.00 to type out the ordinance and to make sure the minutes are delivered to them. The cost for preparing the notes, they all charge various rates from $500.00 to $900.00. He said they should go with proposal number three, which is to handle the debt ourselves. The Fire Truck would cost $650,000.00. We can take $150,000.00 out of the Capital Improvement Fund or get it fi'om the UEZ. The only problem with the UEZ is it would take about 6 months to get approved. DISCUSSION Mayor Sica interrupted and said if we look at number three and accelerate the ten years to five years it is only $100,000.00 a year. We could decrease that interest note and save a whole lot of money. CounciImember Gutowski asked if the UEZ was transferable. If they approve it can we transfer it back into the budget? Mayor Sica said yes, and then what we can do is to go to the UEZ and get 33% or 34% or whatever our land holding is there. He said he did not know if there is any law saying that three years down the road we can't go back and say we want to accelerate the payment with UEZ funds. We can spend as much money as we want in anyone year. He I September 16, 1997 DISCUSSION (CONTINUED) RE: FIRE TRUCK/ POLICE CAR said he has not explored that but he still thinks the best way to go is to accelerate into a five year payout. Let's say we apply to the UEZ for their one third (113) and we pay that note right away. Does that mean the town of Carteret doesn't have to put any money in for a year to a year and one half out of our current fund budget? We would not take anything out of Capital next year we would take it out of the UEZ to pay that first years note off, the first year of one hundred thousand dollars interest. Fifty-thousand dollars is a lot of money in five years. He said he thought that was the most logical way to go with it. Five years from now we will own it not like some towns. Woodbridge bonded for a whole bunch of pick up trucks five years ago. They have fifteen more years to pay them off. A lot of towns bond for cop cars but we don't. We pay for them every year out of our general fund. If you bond for a police car it will last three years if you are lucky and you will still be paying for it another fifteen years. The life expediency of a Fire Truck far exceeds the five years but it would not hold true on a police car. Who would want to drag payments of a fire truck for twenty years and make some banker rich. Councilmember Failace asked if the life expediency of a fire truck was twenty years. Mayor Sica said the one they have now is twenty-two years old. Borough Attorney Craig Coughlin said they would probably have to write off the last twenty years. Mayor Sica said even if we put a line item in (inaudible) for this fire truck and we now turn around and sell our fire truck it will bring in twenty-five thousand dollars. Somebody will buy that truck and we could then take that money and buy that line item. Just plug that money into the Capital Fund and it will go to reduce the debt of the present fire truck. He said he thought that was the best way to go. Councilmember Failace said he agreed with the Mayor but we are gambling a little with the dice. Mayor Sica said it does not amount to that much when you are paying it at an (inaudible) payment time. Patrick DeBlasio said if the rates start going up we can sell the whole thing. If the rates stay as low as 4% where they are right now we may want to carry that debt. We don't have to make a decision on that right now. Mayor Sica said if, for instance, they get money fi'om the Bellemeade Project we could retire the whole (inaudible) just by taking that money and putting in the (inaudible) program. He then asked Patrick DeBlasio about the MCUA, the cost of issuance $20,000.00. He asked ifthat was a one time deal. Patrick DeBlasio said yes it is a one time deal and they would take that and add it to our debt. The principal payout would be $500,000.00 plus the $20,000.00 over twenty years. 2 Councilmember Gutowski said there is no accelerated (inaudible) MCIA. If they say it's ten years, it is ten years. Mayor Sica said he did not think they should strap themselves for ten years. He said he saw good things happening. There are more buildings being built and more industry coming in. We have two new companies coming in by Hennan's Warehouse. At the WIZ Building we have World Wide Communications going in. These are major companies that are going to employ a lot of people. You get a company that employees a hundred people and they use the bathroom we get a lot of sewer money from that. White Rose has rented that remgerator down there so they are going in and building another one. All these things will be coming in five year intervals. Every year we will have some monies coming in that we did not have the year before, if you look into the future. If that is the case and it is not necessary to plug into the general fund, we can put it into the Capital and payoff the notes. Councilmember Gutowski said they have that now with White Rose and (inaudible). Mayor Sica said the refrigerator is coming on right away. It is the same way with Duie Pyle they pay nothing the first year but they always pay on the land. Land is always a secure dollar. The other things are so intangible that we don't see them right now but we know we are going to see them every year. Every time a new company comes into this town the sewer revenue increases. Better an increase fÌ'om that then a home because a home does not pay. He said he would suggest that they immediately authorized Patrick to go out and borrow the $500,000.00. Let's put the down payment of the fire truck and get it ordered. He said if they order it right now they can have it some time next year. The company that is looking to put the fire truck in here will have a sharp pencil but supposedly they have an order fÌ'om New York or Philadelphia that is going to tie that company up for a year. We still have to bid for it but the guy who tailors the spec.'s is going to have the best shot at it. Councilmember Fazekas said if we can get it out, it will take awhile. Mayor Sica asked if they wanted to go with the five year note. He then told Patrick DeBlasio to tell Gloria Goodrich to advertise for bid. Municipal Clerk Kathleen Barney said they had that on for Thursday. Mayor Sica said they should try to get it into the paper for Thursday. He said a few days means a lot. As a matter of fact he thinks there is a deal with the company that if we pay some money up fÌ'ont we save some money. Patrick DeBlasio said he didn't know about that. Mayor Sica said they would have to talk to them. Some of these companies, if you pay 113 up front, they are bonded companies, White, 3 September 16, 1997 DISCUSSION (CONTINUED) September 16, 1997 DISCUSSION (CONTINUED) RE: BONDING ATTORNEY RE: MC MANIMON & SCOTLAND General Motors they are no body to fool with. With your money they will reduce the price to $10,000.00 to $15,000.00. That is a lot of money. Patrick DeBlasio said that brings them to the selection of the Bonding Attorney. We always sought outside consultants. He said he had a listing of three attorney's that have responded to us. He said his preference is McManimon and Scotland. They are a little higher but right in the middle there. We used them on our last two Bond issues and they know our debt structure. Mayor Sica said he didn't care but that he would go with McManimon and Scotland. We are talking about one hundred dollars here. They have a past track record in Carteret and they have gotten us some really attractive rates. Patrick DeBlasio said they are local and have been very good to us. Mayor Sica told Patrick DeBlasio to use McManimon and Scotland. Patrick DeBlasio asked if they were doing a professional service resolution. Municipal Clerk Kathleen Barney said they would do that for Thursday. Patrick DeBlasio asked if they should start with their own funds. Ifwe solicit UEZ again it is going to be six months. Mayor Sica said they should start with their own funds. We can always replace it through UEZ. He told Patrick to call Pat Holden and get the ball rolling to get the maximum amount of dollars out of our fund. Councilmember Failace said they are talking five hundred thousand dollars. Mayor Sica said they would only put down 10%. Patrick DeBlasio said they have to put down (inaudible). Mayor Sica said that won't affect the payment because they have plenty of money. Councilmember Gutowski said they will still need an Ordinance for Thursday to float the bond. Patrick DeBlasio said Thursday we will have both the Ordinance and the Bond. Mayor Sica asked if Bob (inaudible) was coming to the meeting. Municipal Clerk Kathleen Barney said he couldn't make the meeting. He wants to come next Wednesday. 4 September 16, 1997 Mayor Sica said that was no problem because they were not ready for him. We should be fairly close to it, it is just a matter ofthe lawyers. DISCUSSION (CONTINUED) Borough Attorney Craig Coughlin said they did not get the title work yet. Mayor Sica said he was not blaming the Borough Attorney he was blaming the other guy. When you deal with John Spognetz every "I" has to be dotted and every ''T'' has to be crossed. The Mayor said he had a fight with him yesterday over this. He told him no one is running away, the building is going to be there. Carteret is not going Chapter 11. He asked what the big deal was. Let's do a memo of understanding that let's us go in there and fix the thing. Borough Attorney Craig Coughlin said he sent him the contracts. Mayor Sica told the Borough Attorney to stop defending another attorney. Borough Attorney Craig Coughlin said they don't usually do that. RESOLUTION #97-284 was introduced by the Mayor and referred to the Council for action. RESOLUTION 197-284 CLOSED SESSION Upon MMS&C, by Councilmembers Gutowski and Failace RESOLUTION #97-284 "RESOLUTION TO GO INTO CLOSED SESSION" was adopted. Upon individual roll call vote, Councilmembers Bialowarczuk, DuPont, Failace, Fazekas and Gutowski voted in the affinnative. Councilmember Feingold was noted absent. ADOPTED At approximately 6:55 P.M. a Closed Session was held to discuss personnel and contract negotiations. At approximately 7:20 P.M., upon MMS&C, by Councilmembers Gutowski and Failace and unanimous affinnative vote of the five members present this meeting was adjourned. ADJOURNED KMB/apm Respectfully Submitted, ~~ Municipal Clerk 5 September 16, 1997 INFORMAL MEETING