HARBOR SPRINGS — Bond money could be a funding option for the multi-million dollar substation project coming to Harbor Springs.
The Harbor Springs City Council unanimously approved a resolution allowing for a letter of intent for bonding projects during their Monday meeting.
While the council didn’t approve a set amount to bond for, the staff recommendation is to have the bond not exceed $10 million. Council will discuss the bond amount in more detail at a later date.
The money would be used for the substation materials and construction, an M-119 line rebuild and advanced metering infrastructure (AMI) metering.
City manager Victor Sinadinoski said they don’t need to do all of the projects, but it would leave the option available.
Last summer, the council approved a $1.3 million transformer purchase. Sinadinoski said the bond money couldn’t be used for the first payment installation, but it could be used for the rest of the payment.
After sharing the letter, anyone opposed to the idea of bonding has 45 days to petition. A total of 10% of voter signatures need to be collected to allow the issue to go to a vote.
If not enough signatures are collected, the city is able to go straight to bond.
The city is currently in the middle of building a second electrical substation to help handle the electrical load. Officials said one substation is fine for year-round use, but the second substation is necessary to handle the influx of people that visit the area in the summer.
Harbor Springs’ electrical services cover beyond the city limits.
According to agenda materials, a similar bond repayment schedule was used for the Harbor Springs Sewage Authority’s 2002 system improvements. Things like annual interest rate, repayment timeline and original bond amounts will affect the end cost.
The 2002 project has a 20-year repayment timeline with 2.5% interest. Sinadinoski said he expects a higher interest rate this time, likely 3.5% or higher.
The council is not meeting the first week of April, but will be meeting again for a regular meeting on April 21.
— Contact reporter Karly Graham at kgraham@petoskeynews.com. Follow her on Twitter at @KarlyGrahamJRN.
