St. Louis County commissioners agreed to issue bonds up to $26 million during their meeting in Duluth on Tuesday in order to build three rural campuses for the Public Works Department.
The project was billed as continued modernization of county infrastructure, and one that would benefit staff and operators while also providing improved housing for the fleet of road maintenance and snow-clearing equipment.
The new facilities would be built to last up to 100 years, using insulated concrete panels, and consolidate existing locations, such as making Tower and Embarrass garages into one centralized spot in Kugler Township.
Commissioners voted unanimously to issue the general obligation bonds, setting in motion Public Works facilities to also go up in Culver Township and near Whiteface Reservoir. For the new locations, the county is using its own tax-forfeited lands.
Additional bonded funds will go toward smaller projects such as adding a salt/sand dome and brine-making system to the Meadowlands Public Works Maintenance Facility, with similar features also going to garages in Hibbing and Floodwood, the Jean Duluth garage, Cotton, and the Buyck garage. The county Public Works manages 18 sites in all, including 73 buildings. However, some sites feature the use of portable toilets only, a fact that was noted in the meeting.
“This move to the Kugler garage is going to be huge for taxpayers, but also for the employees there,” Commissioner Paul McDonald, of Ely, said. “Everything is together at the same time; it’s going to benefit employees and taxpayers.”
Snowplow operators who are already capturing 28 lane miles of road per day — an impressive figure, commissioners agreed — figure to be better positioned in the new locations for even more efficient operations.
The commissioners and county staff noted that many of the existing facilities being replaced were steel and metal buildings constructed in the 1930s. Modern plow trucks have outgrown those quarters, and the buildings are outdated and failing in some cases.
“It’s amazing it lasted as long as it did,” McDonald said of the Embarrass facility on Minnesota Highway 21.
The county has been using bonding to accentuate its capital and road projects for a number of years. In October, it snared a 1.67% interest rate on $25.4 million aimed at fortifying the county’s existing road and bridge projects through 2024.
The process allows the county to accelerate the amount of work it can get done while interest rates are low.
Virginia-based Commissioner Keith Nelson said he’s been around long enough to see bond payments reach the end.
“That’s what gives us this opportunity to again capture those investments that we’ve made without further stressing our levy on our constituents,” Nelson said.
On 20 years of principal payments, the county can get an interest rate at 1.652%, estimated Terri Heaton, a principal at Baker Tilly.
“The 1.652 is the reason we’re looking at proceeding right now with the bond sale,” she told commissioners.
If it acts at that rate, the county would pay in cash its interest within the first two years, about $1.7 million, and start paying principal in the third year, retiring the payments in 2043. As part of its vote, the County Board had to agreed to amend its already approved Capital Improvement Plan for the years 2021 through 2025, to include the new projects.
Nelson was quick to remind the board that only in government was loaning money referred to as bonding.
Meanwhile, Commissioner Patrick Boyle, representing eastern Duluth, asked that further efficiencies, such as solar and geothermal energy, be considered when the buildings are designed and let out for bid. He was assured those things were under consideration.
Boyle said housing equipment under one roof was always better than outdoors in the cold and elements. It was noted during the meeting that the county has been in the process of spending millions annually in updating its fleet of plowing trucks.
There were no objections to the sale of bonds by the county during what was a public hearing on the process.
“This is good for the public,” Boyle said. “It’s good for a number of reasons.”