Hoffman board weighs bond sale

Hoffman Estates officials late Monday were considering the issue of $54.9 million in bonds to pay for new and improved village facilities.

Their decision on whether to finalize a plan to sell the bonds in two separate sales could be made as early as next Monday.

The bonds would pay for a new fire station, police station and water tank, as well as the current renovations at village hall.

Mayor William McLeod said the bonds are able to be issued without a referendum or an increase in property taxes.

The first bond issue is proposed for next month at $26.2 million.

These bonds would cover everything but the actual construction of the new police station. The land costs for the new station would be part of this first sale, however.

As the design planning for the new police station is beginning only today, however, another $28.7 million in bonds would be sold nearly a year from now, just before construction begins.

Finance Director Michael DuCharme said the delay of this sale would spare the village the immediate interest costs on money it has no way of spending yet.

The breakdown of costs on the projects is $6.5 million for the fire station, $6.25 million for village hall renovations, $5.75 million for the water tank and $32 million for the land, design and construction of the police station.

DuCharme said the scope of the work is no different than was presented to the board in the fall of 2006. But while the project budgets have increased since then, they haven't escalated as much as they might have due to falling interest rates.

"We were originally scheduled to go to market in the fall of 2007," DuCharme reminded the board Monday.

"Is this timing optimal?" Trustee Cary Collins asked. "I don't know."

Collins suggested the village begin rotating the firms it uses as its investment banker to ensure it's getting the best deal possible.

John Peterson of William Blair & Company said his firm would earn $250,000 in fees from the amount of Hoffman Estates' bond sale. Collins wondered if this was truly a competitive rate.

Village hall renovations are expected to be done this September. A more strategically located Fire Station 24 and nearby water tank would be done in 2009, and a larger police station in 2010.