Rec center in Rochelle’s future?

Park board looks at financing options for possible community facility

John Shank
Posted 7/16/18

Flagg-Rochelle Community Park District commissioners and staff have been working hard the past couple of years to complete several needed facility upgrades, which has put the district in position to revisit building a community recreation center in the not-so-distant future.

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Rec center in Rochelle’s future?

Park board looks at financing options for possible community facility

Posted

ROCHELLE — Flagg-Rochelle Community Park District commissioners and staff have been working hard the past couple of years to complete several needed facility upgrades, which has put the district in position to revisit building a community recreation center in the not-so-distant future.
For several years, representatives of the park district, City of Rochelle, school districts and private citizen groups have tried to figure out a way to finance a stand-alone recreation center for the community.
Collaborative efforts in the past have shown initial promise in the planning stage for building a facility, but the projects have lost steam when it comes to how to finance it and who would operate it.
With a majority of the big ticket upgrading projects behind them, park district leaders are now looking at the possibility of building a community recreation center on their own and financing construction with non-referendum general bonds.
On Monday night, the board heard from its outside financial adviser Tom Chapman, of Raymond James, who explained three options the district could take to finance the project, including voter-approved referendum bonds, non-referendum bonds and alternate revenue bonds.
“Most major projects like this are done with alternate revenue bonds, because they include two sources of revenue and it is the most cost-effective plan for the district,” Chapman explained. “General obligation bonds would require a referendum or you could use non-referendum bonds like one you take out every year.”
The park district has the capacity and ability to issue up to approximately $1.5 million in non-referendum bonds each year for capital projects. For several years the typical amount issued annually has been between $750,000 to $800,000.

In the last couple of years those capital funds have been used to pay for the new bike path extension, the old bike path renovation, the Little League fencing and diamond upgrades, the bleachers and press box upgrade at the Helms football field and track, the storage unit at Lincoln School for the AYSO soccer league, the Spring Lake pool renovations and deck replacement, and the ongoing Memorial Park upgrades and the replacement of KidsGround at Cooper Park.
“With many of these major projects done, we think we can now direct more of our annual capital funds toward a community recreation center,” newly elected board president Tim Hayden said on Monday night. “Right now, we are just wanting to know how the numbers would look if we decided to go forward with a facility.”

The numbers
Chapman used an example of an $11 million facility and told the board members that by increasing the annual non-referendum bond to approximately $1.4 million the district could finance the project by themselves.
“Your annual debt service payment costs for 20 years on an $11 million project would be about $870,000,” he explained. “By issuing $1.4 million you would add about $550,000 to the current bond amount you already take for capital projects.”
Chapman said such an increase in the bond would raise taxes on Flagg Township residents an estimated $97 per year for a home owner in a $150,000 home.
“There would be an increase to tax payers by raising the bond level, and you would have less funds to put toward other capital projects, but you do have the ability to fund the building of a rec center.”
No other discussion or specifics about a possible community recreation center followed Chapman’s presentation, but some type of proposal may be rolled out by the park district’s capital committee in the coming months.