Buchanan City Commissioners are considering their options for covering a $1.5 million shortfall in a major downtown infrastructure project.
At a meeting this week, financial consultant Andy Campbell told commissioners the $19.4 million project to replace water and sewer lines, along with streets, sidewalks, and lights downtown is slated to begin in the spring. However, a USDA low interest loan obtained by the city will only cover some of the work.
“USDA funding, which is a low-interest loan for your community, only takes care of the water and sewer aspects,” Campbell said. “You have roads that they don’t fund, you have sidewalks that they don’t fund, and other assets in the downtown infrastructure that need to be taken care of.”
Campbell said the city will be responsible for that part of the project, leaving it with an obligation of about $2.9 million. The commission has already allocated funds from the general fund toward that, and it’s considering putting in more. Plus, it’s secured $900,000 in grants, leaving the $1.5 million shortfall.
Campbell said this project goes back to before 2020, and things since then have changed.
“Inflation’s gone up a lot, so you guys are dealing with a lot of inflation just like everybody else is, and construction costs have skyrocketed.”
Campbell added cities across Michigan did not maintain their infrastructure properly for decades, leaving many like Buchanan with needs like this. He told commissioners they could seek a $1.5 million bond over 15 years to cover the shortfall, or they could take more out of the city’s general fund, although that would leave the city vulnerable.
Commissioners made no decision at the meeting but will have to make one soon.
