Cobb short-term loans

Cobb commissioners to consider $64M in short-term loans as budget season nears

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Cobb budget town hall, Mike Boyce, Cobb public safety bonus, Cobb short-term loans

On Tuesday Cobb commissioners will be asked to approve taking out $64 million in short-term loans.

It’s become a regular proceeding for both the county government and the Cobb school board. The Tax Anticipation Notes (TANs) allow governing bodies to take out the loans, which are payable at the end of a calendar year, for a variety of reasons.

UPDATED: Commissioners approved the request by a 4-0 vote.

The Cobb Board of Education took out $90 million in TANs in December to get a head start on construction projects in the new Cobb Ed-V SPLOST collection period.

In the case of Cobb government, the short-term loans bridge a spending gap until the new fiscal year begins on Oct. 1. Cobb property taxes are collected in the fall of each year.

Last year Cobb commissioners took out $90 million in TANs, which are low-interest obligation notes and are subject to a bidding process.

This year, the county says it won’t know exactly how much the savings will be until the end of June, when the loans are formally taken out. Cobb finance director Bill Volckmann estimates that figure range from $300,000 to $400,000.

Here’s some background on the TANs proposal, and the resolution the commissioners will be asked to approve.

The short-term loan action comes right before the formal fiscal year 2020 budget proposal comes before the commissioners.

Chairman Mike Boyce will recommend his budget on July 8 at 1:30 p.m. Three public hearings will follow, with adoption scheduled for July 23. The hearings will be on July 9, 16, and 23.

In March Boyce held town hall meetings around the county to gain input on his proposed budget outline of $440.6 million.

That includes an across-the-board pay increase, more Sunday library hours and a reduction in transfer funds from the Cobb water system, all without a millage increase.

He also wants a bigger raise for public safety employees, who’ve been showing up in droves to demand additional compensation, retention and other measures to improve what some have called a crisis.

Last month commissioners approved a one-time bonus, at Boyce’s request, for some Cobb police officers, firefighters and sheriff’s deputies that will take effect in August.

 

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Cobb commissioners seek $90M in short-term loans; East Cobb citizen appointed to planning commission

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The Cobb Board of Commissioners on Tuesday authorized county budget officials to begin the process of taking out short-term tax-anticipation notes (TANs) that would be repaid later this year.

By a 5-0 vote the commission approved a measure that would obtain $90 million in TANs, which are short-term loans used to plug county finances and spending between budget years. The current fiscal year 2018 (with a general fund budget of $405 million) ends at the end of the September.

Since the Cobb tax digest is revealed and millage rate is set in July, the county doesn’t begin collecting property taxes until a new fiscal year is underway. Those bills are mailed out in October. The county tax assessor’s office began mailing out assessment values to residential and commercial property owners last month.

According to a background sheet from Tuesday’s meeting agenda, Cobb has been issuing TANs since the late 1980s, a practice that “provides the needed liquidity at attractive borrowing rates to the County.”

(The Cobb County School District also occasionally seeks out TANs, and recently obtained $40 million in short-term loans for construction purposes.)

The TANs are general obligation bonds and interest is usually tax-exempt. Last year Cobb borrowed $60 million in TANs, but the amount has gone up because of a projected fiscal year 2019 deficit of at least $30 million.

The county budget office will begin a competitive bidding process for the TANs in May and present a low bid to the commissioners for approval before any loans would be obtained.

The TANS would have to be repaid by the end of November.

Related stories

Andy Smith, the newest member of the Cobb Planning Commission.

Also Tuesday, East Cobb resident Andy Smith was formally announced as the newest member of the Cobb Planning Commission, which advises the commissioners on zoning issues.

He is the appointee of District 2 commissioner Bob Ott and will serve at his first meeting in May.

Smith succeeds Mike Terry, who retired after last week’s planning commission meeting. Terry was appointed when Ott first took office in 2009. Ott, a former member of the planning commission, said Terry did “a yeoman’s job” during his long tenure.

Terry was also the board’s chairman. Judy Williams of Northeast Cobb, appointed by District 3 commissioner JoAnn Birrell, will assume duties as the new chairwoman next month.

In other business Tuesday, the commissioners formalized the spending of $47,000 for emergency repairs for a sinkhole on Woodlawn Drive (previous East Cobb News post here) and approved a change-order for a $332,781 savings in its final contract with C.W. Matthews for a roundabout project in front of Pope High School.

The final cost for the project, which was completed right before the start of the school year, comes to $3,053 million.

 

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