In the first board meeting of their term, McComb selectmen were caught off guard Tuesday night by a proposal to issue bonds to refinance a 10-year-old, $2 million debt, and two selectmen spoke out against the surprise.
But the board voted 5-1, with Selectman Tommy McKenzie opposed, to hire four professionals to handle the refinancing process of bonds issued in 2004 and to allow the city to move forward with looking for a bond buyer.
Troy Johnson of Butler Snow law firm in Jackson spoke to selectmen about the possibility of refinancing to save approximately $116,000 to $124,000 over 10 years, averaging about $11,000 per year, depending on the new interest rates.
The city still owes $1.23 million on the 2004 bond. The new bond issue would not exceed $1.3 million, officials said.
“This opportunity has only arisen because of the fact that we’ve paid off at least 10 years of that bond issue,” city administrator Quordiniah Lockley said. “When I looked at this a year or two ago, it was not available to us.”
According to a 2004 Enterprise-Journal article, the bonds were used to fund the McComb Sports Park construction, a storm water drainage project and renovations at the Martin Luther King Center, as well as the purchase of firefighting equipment.
Johnson said the interest rate on the bond is between 4 and 5 percent, and he believes that with the current market, the rate could decrease to 2 or 3 percent.
“In general, the way I explain it to people — it’s like refinancing your house at lower interest rates,” Johnson said.
Johnson said he and Mayor Whitney Rawlings have discussed the refinancing for a few weeks before Tuesday, but the issue was a new discussion for selectmen.
McKenzie, who has complained a few times about matters being handled at board meetings without discussion in a prior work session, opposed the measure on the same principle.
“Is this a pressing matter that has to be done tonight? I’m wondering why it didn’t go through a work session for us to discuss and decide if we want to use Butler Snow or if we want to use these other people as a formality,” McKenzie said. “I would like the board to have an opportunity to look at these things before we have to vote on them. I don’t like surprises, and I didn’t know this was something we needed to do.”
Selectman Michael Cameron, who voted in favor of the refinancing, said he waited for Johnson to leave the room after the vote to express his opinions about the matter.
“To the new members, y’all don’t understand, and I’m sorry, but the members that have been sitting on this board for the last 31⁄2 years —this is what we’re sick and tired of,” he said. “If this was thought about two years ago, I can promise you it was thought about more than a week ago.”
Cameron noted that the board didn’t have a work session last week, instead using its meeting time to learn more about tablet computers they’ll be using to access board packet information in the city’s effort to transform to paperless meetings. However, some of the board meeting materials still were not accessible by tablet Tuesday night, further drawing Cameron’s ire.
“We had a work session last week where we didn’t do anything except talk about these tablets that still aren’t working, and I voted for (the refinancing tonight) because it’s saving $116,000,” he said. “But this is the kind of thing that I don’t see how this can be an agenda item and not be discussed past one day.
“I’m sick of tired of it. I know a few more are.”
Selectman Ronnie Brock, in his first board meeting of his term, disagreed, saying that sometimes things come up that must be dealt with, even though they were not discussed in a work session.
Lockley, however, said that there was no deadline on the refinancing.
“You can’t always expect things to just come to us. We need to seek out and make sure what’s coming down the pipe also,” Brock said. “It wasn’t too long ago that I sat out there and watched a raise come to the board that should have been discussed two months prior, too. It was a surprise then, but it passed with flying colors.”
“OK, we’ll see how you like it later,” Cameron responded.
