Whether or not to provide financing for the construction of water and sewer lines to the Concordia Senior Communities project was one of the issues discussed by members of the Amsterdam Common Council, Mayor, Controller and Corporation Counsel at a committee meeting Monday afternoon. Mayor Ann Thane proposed that the city secure a Bond Anticipation Note (BAN) to construct the lines, and impose an additional tax on the property to offset payments on the debt.
Concordia Senior Communities will be an assisted living center to be built near River Ridge Living Center which is located on the south side of the city. The project has secured funding for the construction of the facility but not for the extension of city water and sewer lines to the property. The construction of the lines is estimated to be approximately $500,000.
Corporation Counsel Gerard DeCusatis explained, “The city would pay for the extension. The cost of the debt service and the principal for the extension would be paid for by an ad velorum tax on the property that is benefited. There would be no net impact on the city budget.”
DeCusatis said the initial BAN would be converted into a bond and most likely be repaid over the course of 10 to 15 years.
Alderman Ron Barone expressed reluctance about the idea, citing concerns about the risk to the city and suggested looking at other funding options for the project. Thane said that since construction was scheduled to begin soon, that applying for other grants or loans would take too much time and hold the project up.
Thane asked Barone, “Do you want to squash this project?”
“I don’t care,” said Barone, who later said he was not serious about that remark.
“It’s 125 really good paying jobs and added tax base, I don’t know why you wouldn’t consider this,” said Thane.
“I don’t want to pay for it, we don’t have the money for it,” said Barone.
“But you are not paying for it,” said Thane. “It is zero impact on your budget.”
DeCusatis explained that in the event the project failed, the value of the property, estimated at around $20 million, would secure the loan. He explained that because the property was obligated to repay the city via a property tax, that if the organization went bankrupt, the city would be “first in line” to be reimbursed before any other of the organization’s loans or other obligations.
DeCusatis said that a tax district would have to be set up for the area that would benefit from the project. “This property is going to have to pay this charge,” said De Cusatis.
“[Montgomery County Business Development Center CEO] Ken Rose is strongly suggesting the city pursue this avenue,” said Thane.
“Why can’t Ken come up with the money?” asked Barone.
“Let them deal with it, financially we can’t afford to deal with it right now,” said Alderwoman Diane Hatzenbuhler.
“Why can’t [the Amsterdam Industrial Developement Agency] handle it?” asked Barone. “Look to see if they can find a bond for them…or look for a grant.”
“They can’t get another grant for this, they’ve already gotten a grant for the capital build out, water isn’t included in this.” said Thane. “They want to begin construction almost immediately.”
“I would think they would have come before this council before now,” said Barone. “If all this work is being done…they’ve precluded us up until this point. Now all of a sudden we’ve got to jump into an action that I don’t know whether I want to [do] or not.”
“All of this funding…could have been done through [AIDA],” said Barone, referring to how Concordia went to Montgomery County for funding assistance rather than through AIDA.
“Ken caught the project, what are you going to do?” asked Thane.
“And now he’s going to us,” said Barone.
Hatzenbuhler expressed concern over the amount of debt the city currently owes. “We still we don’t know where we are.”
Controller Matthew Agresta answered, “You keep saying ‘we don’t know where we are’ like we’re driving lost in the woods. We can’t necessarily justify ‘up to current’ certain things that you want to know. But we have another, I believe, $20 million we could take on in debt service given our financial situation. So a $500,000 bond is not something that we can’t do.”
“If you can bring in a $20 million project that’s not only going to bring in jobs, but the revenue from the water and sewer that we’re building, that’s only going to improve our position in the future,” said Agresta.
“I’ve listened to this many times before and I’ll take you around and show you all the empty buildings with all these people putting all these big things in,” said Barone. He cited several examples of projects that had failed in the past. “All these big people that come into Amsterdam and come into Montgomery County are going to do everything and then bango they up and leave and we’re stuck with all these white elephants.”
“Ok, so you don’t want to do this?” asked Thane.
“I’m not saying that,” said Barone.
“I’d rather drill this back down then, and hear what you want to do,” said Thane.
“If it’s done right, I have no problem with it,” said Barone.
* A previous version of this article referred to the project in question as “Deer Run”. This was the name referred to at the meeting. However, the correct name of the project is Concordia Senior Communities.