McHenry pitches in to help Fox River Grove streets

If Fox River Grove residents notice their drives around town going a little smoother next year, they can thank the city of McHenry.

McHenry leaders have agreed to pass on issuing $1 million in federal stimulus bonds authorized through the county, allowing the village to put out about $1.23 million to address pressing road needs.

"This is going to give us the opportunity to do five or six years of road work all in one year," Fox River Grove Village Administrator Art Osten said. "We really want to stress how thankful we are to McHenry."

The village initially had hoped to issue $1.5 million in Recovery Zone Economic Development Bonds. Part of the federal stimulus package, the county-administered program allows government entities to issue tax-exempt bonds at significant savings compared to borrowing money on the open market.

However, by the time Fox River Grove submitted its application, the county already had distributed all but $238,000 of its $18.3 million allotment.

Fortunately for the village, however, the city of McHenry agreed to give back $1 million of its allotment.

The McHenry County Board's Finance and Audit Committee approved the deal, and assuming the full county board agrees it next will be up to the village to issue and repay the bonds.

Finance Committee Chairman Marc Munaretto said the county is working with other government agencies to obtain additional bonding authority for government agencies.

"We realized early on that this could be a powerful economic development tool," he said.

Things didn't go nearly as well Tuesday for the company behind the McHenry County K-Nines minor league baseball club.

The club's owner, EquityOne Sports Development, made its pitch to the committee for the authority to issue $15 million in tax-exempt bonds to help fund its proposed 3,200-capacity stadium along Route 14 on the east side of Woodstock.

Committee members, which control about $27.5 million in bonding authority for private companies, took a pass, at least until EquityOne lines up a bank willing to take the bonds to market.

"We don't want to have another project come in and ask for $15 million of the cap and we can't do it because we've (committed) to you," Munaretto told EquityOne President Mark Houser.

Houser said he plans to return to the committee in two weeks with a bank chosen for the project.

"With the market today, it makes getting financing a little tougher, but we're on target to break ground (on the stadium) in the spring of 2010 and playing baseball in 2011," he said.

So far, Munaretto said, EquityOne is the only private enterprise to apply for the federal program. As with the public enterprise portion of the program, the county will not be on the hook if the bond issuer defaults.

He expects the proposal to win approval if the company can line up financing.

"I would embrace a project that brings long-term tourism dollars to McHenry County," Munaretto said.