The Norman City Council approved the second of three Norman Forward revenue bond agreements Tuesday. Due to a lower interest rate, it could save the city about $2.5 million.
The bond -- which will be used to pay for construction, furnishings and equipment for the new central library branch -- is with JPMorgan Chase & Co. bank for close to $31 million with a 2.4 percent interest rate, City Finance Director Anthony Francisco said.
"It all comes out in the wash; we may be saving here, but we might be spending more somewhere else," Francisco said. "But if you just compare the 3 percent rate we were expecting to the 2.4 percent rate, you'll probably be saving around $2.5 million."
The projected savings will help balance out this year's low sales tax collections, which should help the outlook of the sales-tax funded, $150 million Norman Forward initiative.
For Fiscal Year 2017, the Norman Forward sales tax collected $9,183,569, or 91.64 percent, of the budgeted projection, according to a city finance department press release.
At a city council conference before the official meeting Tuesday, Ward 4 representative Bill Hickman asked if there are concerns about funding future Norman Forward projects that have not yet started.
"I want us to be thoughtful in advance about large facilities that will have large operating costs," Hickman said. "We need to be thoughtful in advance that if we need to issue $37 million to build an aquatic center, do we have the resources to staff it and run it adequately, or do we delay it or something else?"
Francisco said it is early to be worried, but sluggish sales tax numbers are cause for concern. Still, he said he believes the projects will be completed with the help of strategic planning.
"If we continue to have revenues below projections, something will have to give and some things that we wanted to do, we may not be able to do," he said. "I believe that it is our job to make sure that the projects that the voters wanted to be paid for with Norman Forward proceeds are delivered, and I think that's our first priority.
"So we have to maybe take some things out of projects that we might have wanted to do or if we get lucky and revenue comes in a bit above what we thought, or interest rates go down from where we thought or we save some money for paying personnel out of different sources, we want to make sure that the projects themselves get done because that was a promise to the people."
