Summit County councilmembers authorized up to $99 million in bonds for transportation projects last year.
The county council voted Jan. 14 to issue about $7 million less than that. The final price depends on how much investors ultimately bid at the bond sale scheduled for Thursday, Jan. 22.
Councilmember Chris Robinson said Summit County has some breathing room because of the way the bonds are structured.
“I think that we have gone about it in a responsible way, where we have a 50% cushion,” he said. “That's better cushion than you ever see in most things.”
It’s a cushion that comes courtesy of a sales tax the council approved last fall that will more than make up for the new debt.
It’s a 1.1% tax on purchases in unincorporated Summit County, excepting gas, prescriptions and groceries. The new tax kicks in this summer.
The tax is earmarked, by state law, for transportation projects.
The county must pay off the bonds within 21 years, but can pay them back early after 10 years. After that, the new sales tax revenue will flow into the county’s general fund.
The county’s revenue bond rating is AA-, which is a couple levels below the highest possible AAA rating.
Leavitt explained that Summit County didn’t get a perfect score partly because its economy is less diverse than others, but the cushion Robinson referred to helps.
“We're a tourist economy. Another reason for the rating was because it's a new sales tax. It's not proven,” Leavitt said. “We do estimate a two-times debt service coverage, which helped support a more positive rating.”
The bonds can fund transportation projects such as the future bus rapid transit lanes on state Route 224, Summit County Councilmember Megan McKenna said after the council meeting on KPCW’s “Local News Hour.”
Summit County is a financial supporter of KPCW.
