FAIRMONT – With the potential Justice Center project front and center, financing information was presented at Monday’s Martin County EDA meeting.

Northland Services Representative George Eilertson was on hand to discuss potential financing options. He said they are looking at two options: General Obligation bonds, which would only cover the jail portion of the Justice Center, and lease financing, which Eilertson said is common for projects like this.

“The authority to issue this kind of bond is not with the county board, but rather with an EDA,” he said. “It’s within your statutory authority to issue revenue bonds for corporate purposes, which includes the construction of public facilities.”

From there, Eilertson said the county and EDA can enter a lease agreement. The EDA would have a leasehold interest in the property, and when the debt is retired, it would go to the county. He said this option is often preferred in projects like this because it avoids a reverse referendum.

“If 5 percent or more of the residents who voted in the last election sign a petition, that would trigger the need for having a referendum vote,” Eilertson said.

Board Member Billeye Rabbe asked if this is how counties get by doing large projects like the Justice Center without needing the citizens to vote. Eilertson said that is one of the factors involved, but a citizen vote would not be guaranteed unless that 5 percent threshold was met.5789

Board Member Tim Terfehr asked if there was a rate difference between the two types of bonds. Eilertson said the rate on General Obligation jail bonding is triple-A due to a state program, while lease financing would not have that program and be at double-A.

Kennedy and Graven Chartered Attorney Gina Fiorini said, thanks to a break for public projects from Congress, the interest earned on these bonds would be tax exempt.

“The county gets a little bit of a lower interest rate when you borrow money than a private party might because there’s this tax benefit to bondholders,” she said.

A resolution declaring intent to reimburse certain expenditures from these bonds was introduced to the board alongside this information, but with only Terfehr, Wes Anderson, Rabbe, and Richard Koons present at the meeting, it was decided to come back with the resolution and more information at a later date.

In other news

–Martin County EDA is participating in a regional coalition to put together a Federal EDA grant. The grant would seek to address problems caused by recent manufacturing losses in Martin and Faribault counties.

— A supply and demand gap analysis regarding Martin County child care is underway between the Martin County EDA and First Children’s Finance.

— An application to participate in the Minnesota Housing Partnership’s Southwest Minnesota Housing Institute was approved. The program will seek to bring more housing to Martin County by connecting the EDA with housing partners, industry professionals, and a customized curriculum of housing knowledge.