The bulk of construction of new sewer lines into the newly annexed airport industrial park will likely be underway by next spring.
Two city boards took more steps Monday to prepare for a bond issue that will be used to finance the project.
The city Redevelopment Commission and the Redevelopment Authority agreed to a lease agreement that will be used to pay off the bonds over the next 25 years.
The city has not finalized the bond issue yet. It could be as large as $7 million, but is expected to be closer to $6.1 million.
The city is using $2 million in “cash on hand” on the project to help limit the amount needed for the bond.
There will be a second signing of the documents once the final figures on the bond are available.
Construction costs are expected to be around $7 million, but that depends in part on the bids for the work, said City Planner Jeremy Skinner.
If bids come in low, the city could choose to do more road improvements within the area or reduce the overall cost, he said.
The Redevelopment Commission and the Authority adopted a lease plan earlier this month and action on Monday included a public hearing on the arrangement between the commission and the authority.
The sewer and street improvements will be done in two phases. In general, the first phase will include improvements along Anchorage Road, CR 200N, Pound Drive West, Pound Drive North, Cessna Road, Bell Drive, Boeing Road and Biomet Drive. The other includes Bell Drive, North Rainbow Drive and Douglas Road.
At the same time, the city is also in the process of consolidating two tax increment finance districts, known as the northern and eastern districts, into one and then expanding the district to include the annexed area, which is roughly 400 acres.
Revenues generated from within the consolidated TIF district will be used to pay for the pending improvements.
According to a presentation from Andrew Mouser, of Umbaugh and Associates, the net interest cost of the bond would average out to 3.75 percent over the 25-year bond. Even with the new bond payments, the newly consolidated TIF district is expected to continue to grow more revenues over the next two decades.
“For every dollar of debt payment you have, you have right around $2 of TIF (revenue)?already being generated, which leaves extra money for the redevelopment commission for pay-as-you-go projects on an annual basis,” Mouser said.
The expanded TIF?district will be finalized by mid October.
The city will seek bids on the sewer work by early October and a contractor could be chosen by early November.
Sewer and road work will likely continue into 2020, Skinner said.