Archbold Village Council approved a new finance policy, that’s actually old.
Dennis Howell, Archbold village administrator, said the new finance and debt management policy, is an effort to get a higher rating, and, in turn, a lower interest rate, on the village’s outstanding debt.
The policy was approved by council at the Monday, Oct. 19, meeting,
“It’s a new world in borrowing and issuing debt since the tanking of the fi- nancial world,” Howell said.
“People are not so willing to buy notes or bonds.”
Howell said in the past, the village was able to borrow money by selling bonds or one-year notes without having the debt rated by an organization such as Standard & Poor’s.
“We never rated our debt, and we were getting good interest rates,” he said.
But, since the near-collapse of the banking industry in September 2008, a rating is required to get the best interest rates.
With the help of a consultant, Archbold obtained a Standard & Poor rating. Village officials were disappointed they didn’t earn a higher S&P rating.
“We had been doing all the right things, but we did not have a written policy” stating the village policy on debt.
As a result, Howell and other village officials spent about six months writing the new policy, which essentially sets down on paper all of the village’s past practices.
Howell said the village following the unwritten guidelines “for many, many years.”
Last week, Joan Lovejoy, village fiscal officer, said the village debt, which does not include special assessments, was about $4.2 million.
Of that figure, $2.15 million is the debt incurred for the construction of Woodland Park.
The village still owes about $2,050,000 on the renovations at the Archbold Wastewater Treatment Plant.
However, the debt has been reduced. In 2007, the village debt was $6.4 million, Lovejoy said.