At the April 4th, 2017 regular meeting, the St. Croix County Board approved the borrowing of an additional $330,000.00 to cover cost overruns associated with the construction and remodeling of the health center project.
According to Randy, the Market & Johnson construction manager overseeing the project: “Right now, as it sits… we’re on that, uhh… dreaded point where we’re gettin’ close… we’re not out of money yet, [but] we’re very close.”
The loan will come from the County’s General Fund, and increase the total amount borrowed from the General Fund for the Health Center project from $670,000.00 to an even $1,000,000.00. The loan will be made with a 0% interest rate until 1/1/2019, and 1.5% annual interest from that point forward until its repayment.
The blame for the cost overruns was ambiguously stated as being related to the decision to include a geothermal heating system, therapy pool, along with unexpected remodeling expenses associated with electrical systems.
The repayment of the loan is theoretically going to be covered by the revenues generated by the therapy pool, and cost savings derived from the use of geothermal heating, although no substantiative evidence of this was given. An earlier projection related to the therapy pool indicated it would need to generate over $100,000.00 in annual revenue to cover debt service.
This resolution was reviewed and unanimously approved by the Administration Committee before being recommended to the full board for approval.