Celina officials continue to reduce debt

CELINA - Officials are pleased with the city's financial situation as they continue to trim $17.23 million in outstanding debt.

Celina officials this year paid $3.06 million in principal and interest on the aggregate debt load and are poised to pay $2.72 million in 2015.

Mayor Jeff Hazel said during the three years of his administration, the city's debt - money borrowed for capital projects and purchases - decreased from slightly above $23 million to $17.23 million.

"Our debt load is extremely affordable for us," he told the newspaper, adding officials have worked hard to reduce the debt and become financially stable.

Eight percent of the outstanding debt will be paid back through the city's general fund - the account that pays the city's day-to-day operations. The remaining debt will be repaid with funds in the electric, water, wastewater and storm accounts and Tax Increment Financing districts.

Hazel admits the city has also gained additional debt during his tenure.

"It's unrealistic to think that any city or town can operate without debt," he said.

City auditor Betty Strawn explained that some debt is a part of general operations.

"In the midst of this, we've acquired some small debt," she said. "That's why you'll see some fluctuations here. You can't just say we've reduced all of this and never acquired any more debt. We did acquire a little bit more, not much at all."

The city last summer purchased the former First Financial Bank on Main Street for $1.95 million. Officials borrowed internally from the electric fund to acquire the bank building, paying itself back over seven years at a fixed annual rate of 0.21 percent with a total of $220,987 in revenue from the water, wastewater and general fund.

City officials also this year agreed to a $2.94 million acquisition of the former Mercelina Mobile Court and the former Versa Pak building to expand its parks along Grand Lake's shores. The Bryson Trust Fund will pay 90 percent of the deal and the city will fund $300,000 from its general fund.

"We purchased that lakefront property for 10 cents on the dollar essentially," Hazel said. "And we're done. We don't have to pay any more. That $300,000 was already expended this year and that's over."

The city in recent years also paid back debt on two major projects - the Main Street reconstruction project and the purchase of property at the Grand Lake Industrial Park - which included high-interest debt, Strawn said.

"With the exception of the boardwalk (project), which was TIF, we pretty much paid off everything that was callable," Hazel added.

City council last year approved paying the remaining debt - $937,553 - on the extensive Main Street project, which was completed in 2011. Council also six years early paid in full the $150,958 owed on the city's industrial park, saving $39,290 in interest costs.

Hazel believes the city is very financially stable. He noted that council members no longer must wait to learn the amount of general fund carryover when planning the annual budget; they now rely on projected revenue.

"That is why council can approve the budget by year-end. They never could before, if you remember, because they had to see how much was left in the carryover," Hazel said.