E. Dundee wants to clarify loan for village, police renovations
East Dundee trustees approved village hall and police department renovations Monday but won't ratify the $5 million deal until the next board meeting.
That's when the board expects to have a letter from U.S. Bank that would outline and clarify the terms of the $2.25 million loan it would issue to the village for the projects.
Meanwhile, Trustee Allen Skillicorn, who has been opposed to both projects and wanted to save money by having Elgin house the village's overnight prisoners, was mum on the issue Monday night.
"It's moot at this point -- I think I'm in the minority," Skillicorn said ahead of the vote, adding that he will now rely on staff members to set up a meeting with Elgin Police Chief Jeffrey Swoboda. "Even if they approve something, it doesn't mean they can't work out an agreement, either."
East Dundee is looking to renovate its cramped police station that would expand into the East Dundee Fire Protection District's existing building that would also be refurbished after the fire district moves into new headquarters on Route 25, just north of Route 72. The fire station breaks ground on its new station Tuesday and is expected to move in by May or June, officials said.
The police department expansion would include room for state-of-the-art jail cells, processing areas and interview rooms. A $2 million renovation of village hall would also take place.
Trustees Rob Gorman and Jeff Lynam had several questions about the terms of the loan because they said the draft ordinance and a separate letter from the bank didn't match what they were being told at the meeting.
"I'm liking what I'm hearing better than what I'm reading," Lynam said.
Village Administrator Bob Skurla has proposed taking out a $2.25 million line of credit with U.S. Bank and using money generated from its tax increment finance districts to pay off the debt within five years at 1.85 percent interest. TIF funds would also finance the remaining balance of the $5 million project, and the village would do it this way to avoid dipping into reserves, Skurla said.
Gorman questioned whether the 1.85 percent rate would be fixed throughout the life of the five-year loan. Via teleconference, Gary Quinn, U.S. Bank's market president in the commercial banking division, said it would be, but that an undefined variable rate would also apply to the loan until construction is completed. And if the village didn't draw the entire loan, the bank would charge 25 basis points a year on the money that would remain -- one basis point equals 1/100th of 1 percent.
Gorman asked Quinn to put it all in writing.
"We can get a letter that describes those three things (and) I think we would be able to make a decision to do this because what I hear here is very different from the document that I see here."
The next meeting is scheduled for Sept. 3. Skillicorn was the only trustee to vote against the project, and Gorman left before the vote was taken.
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