By Myrna Trauntvein
Times-News Correspondent
Another public hearing, required by federal law, was held by the local building authority to discuss the proposed new city hall for Mona City.
There were just 16 residents present for the hearing but Eric Johnson, bond counsel for the city, was also present and was able to explain his role in the necessary bonding for the proposed edifice.
The bond that the city is seeking is not the same sort of bond the city acquired for the sewer system project, said Johnson. For that bond, the city agreed to pay off the bond amount with the money made from charging residents a sewer use fee each month.
"This has to be a different kind of bond because the city building will not take in revenue," said Johnson.
In the 1970s, he said, the jail in Iron County was condemned. The need for the people of the county to approve a new facility and bonding for that facility was apparent. However, in not one election, but two, the people of the area voted against the proposal.
"The state legislature then enabled local building authorities in the state," said Johnson. "The result in Iron County was that a loan was taken out by the building authority and the jail was built by the building authority and was leased to Iron County. The money from the lease went to repay the loan."
By law, he said, the local building authority has to be made up of the mayor and city council. The funds then are taken from one city pocket and put into the other but it works.
Therefore, a public hearing was held by the local building authority and a resolution was presented at the end of the hearing. The building authority then adopted the resolution and ended the meeting. The city council reconvened in city council meeting where the resolution was then adopted by the council.
The public hearing of the Mona City Local Building Authority Lease Revenue Bonds, Series 2016, in the amount not to exceed $220,000 for the construction of a community center and related improvements and related matters, was then declared open by Greg Newton, city mayor and president of the Local Building Authority.
Before reading the resolution, citizens were asked if they had questions. They were also given an opportunity to speak any time they had questions or comments.
One thing he wanted people to understand was that most of the money for the building was coming from the CIB.
"We will receive $178,000 from the Community Impact Board that does not have to be repaid," he said.
Besides the general fund money that would be earmarked to repay the lease, money would come from rental fees on the building. In addition, a justice court will be established and a new source of revenue will come from fines.
"A Resolution of the Local Building Authority of Mona City, Utah, Authority and Mona City, Juab County, Utah, authorizing the Authority's $180,000 Lease Revenue Bonds, Series 2016, for a Community Center and Related Improvements; Authorizing a Master Resolution, Ground Lease Security Document and other Documents Required in Connection Therewith; and Related Matters," read Newton from the resolution to those at the meeting.
That resolution was agreed to by all members of the local building authority who then ended the meeting and convened in city council meeting. At that point, Newton read the resolution needing to be accepted by the city council.
"A Resolution of the City Council of Mona City, Juab County, Utah, Authorizing an Annually Renewable Lease Agreement Between the City and the Local Building Authority of Mona City, Utah; Authorizing the Authority's $180,000 Lease Revenue Bonds, Series 2016 for a Community Center and Related Improvements; Authorizing a Master Resolution, Ground Lease Security Document, and other Documents Required in Connection Therewith and Related Matters," read Newton.
"One nice thing, is that the money coming from CIB (Community Impact Board) can be repaid at anytime," said Johnson. "The mayor attended the CIB board meeting and begged and groveled but he did a good job in acquiring the funds needed."
The interest rate paid is set at 2 1/2 percent which is lower than a bank would loan money to any public body, he said. However, if the city were to become delinquent on their payments, the interest rate goes up to 18 1/2 percent.
"They are serious about collecting the money," said Johnson. "If you hit a snag, call me and we can work something out to avoid that. The payment will be $11,000 per year for 20 years."
A master lease is a controlling lease under which a lessee can sub-lease the property for a period not extending the term of the master lease.
He said that the city would lease the property in one-year increments. That lease is renewed annually by the city council authorizing the payment in their annual budget.
Newton said he had scoped the city buildings in the communities of both Aurora and Scipio. Both are fairly new and are large enough to serve the community well.
The building in Aurora is approximately the same size as the one in Mona would be.
"The size still freaks me out," said Molli Graham, council member. "Has anyone seen the other two?"
Everd Squire, finance director, said that he had and the one in Aurora was large but it was nice.
"We are limited on space to do city business and to give the public access for public hearings and city council meetings," said Newton. "We want to have available space for community events such as weddings, reunions, public meetings, senior citizens, Daughters of the Utah Pioneers and others."
Frank Riding, former council member, asked if the new building would then be open more days a week than at present.
"We are rapidly approaching the necessity of having our office open five days a week to conduct city business," said Newton. "Another part time employee will be added in the new budget to have the city offices open every weekday."
