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
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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.
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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,
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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.
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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
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September 16, 1997
INFORMAL MEETING