River Forest trustees approved a motion to issue $500,000 in bonds to fund public infrastructure projects at a public hearing on Feb. 16. Final approval of the two-year loan from the village’s general fund is expected next week.
“This is primarily for street resurfacing,” said Village Administrator Eric Palm, later adding: “We’re going to use this to basically continue our street improvement program, resurfacing program on more of a constant basis.”
While technically a bond issuance, the money will be lent from the village’s general fund and will be paid back over the next two years through property taxes. The bonds will carry an interest payment that the village government will repay to the general fund. As a non-home-rule community, River Forest is limited by the state of Illinois in how much money it can borrow at any one time.
“The nice part about doing a two-year note instead of a five and 10 year bond, we’re providing ourselves a lot of flexibility with our finances,” Palm said. “So, for two years, if some major project comes up or we want to issue a large amount of debt, we have that larger amount of debt. We will have the ability to do that.”
Palm said part of Chicago Avenue was resurfaced in 2017, and a portion of the new $500,000 loan will go toward continuing work on Chicago Avenue.
Most street improvements are paid through the village’s motor fuel tax, which is distributed to municipalities by the state based on population.
According to the village’s fiscal 2018 budget, the street improvement program includes grid, patch, overlay and minor curb replacement work on: Vine Street from Thatcher Avenue to Keystone Avenue; Hawthorne Avenue from Franklin Street to Lathrop Avenue; Franklin Street from Oak Avenue to Lake Street; Ashland Avenue from Chicago Avenue to Oak Avenue; and William Street and Clinton Place from Oak Avenue to Quick Avenue.
“This past year the amount of bonds that we had within our debt service extension base was fully paid, and so now we have that amount fully available to us” again, Palm said, later adding: Then, “at the end of the two years, we’ll be back and having another discussion” about issuing more bonds.
River Forest has a AAA-bond rating by Standard & Poors, the highest distinction the rating agency issues. In 2016, the Government and Finance Officers Association of the United States and Canada also honored the village with a Distinguished Budget Presentation Award, a prestigious and difficult achievement that highlights budgetary excellence in policy and financial plans, and operations and communications.
“I like the two-year plan, it doesn’t shackle the future with what we decide today, maybe it’s a lesson Springfield should learn,” Trustee Michael Gibbs said.
Trustees are expected to approve the bond ordinance at a village board meeting on Feb. 26.