Residents seek bonds for subdivision road upgrade
Wednesday, August 7, 2013
The Callaway County Commission is working with a group of about 50 Hunters Creek Subdivision residents northwest of Holts Summit who want to create a Neighborhood Improvement District in order to bring the subdivision’s road up to county standards.
Subdivision residents need to find a way to finance an upgrade of the private road to county standards before the county can agree to begin maintaining the road.
The cost of upgrading the road, which is more than one mile long, to meet county standards has been estimated by engineers hired by the residents at $678,000.
To raise the money, Hunters Creek Subdivision residents have petitioned the Callaway County Commission for permission to create a Neighborhood Improvement District (NID) that would levy assessments against the property owners in the subdivision.
Doc Kritzer, Callaway County western district commissioner, said if the county approves the petition, the county would back a bond to finance the project.
In turn, provisions of the NID require property liens to be placed by the county against each property owner in the subdivision. A special assessment would be imposed each year on the property owners until the bond for the road project is paid in full.
Kritzer said the required 80 percent of residents living in the subdivision have signed a petition asking the county to issue a bond to finance the improvements. The residents agree to repay the costs in annual assessments on their property spread over the bond repayment schedule, usually 10 to 15 years.
The obligation of the homeowners is not a tax, Kritzer said, but there is a requirement to pay the amount due for each property because the county will hold a lien against each property until the property owner pays his or her share of the obligation to pay off the bond.
The bond becomes an obligation of the county, allowing it to be sold at a lower interest rate.
“The county collects the fee for the bond repayments that are placed on tax bills sent to affected property owners. That’s why many people believe the fee is a tax. We have to collect the fees from property owners so the county can make the annual payment on the bond issued for that project,” Kritzer said.
The county has limits on the amount of bonds it can issue.
“We have to control the number of these projects we have on the books because we must stay under our bonding capacity,” he said.
Kritzer said the roads originally constructed for the subdivision were not up to county standards. Property owners must pay to maintain the road through a homeowners association assessments or they can improve it enough so the county can take over maintenance.
The county is now verifying signatures on the petition and making sure all taxes are paid by those signing the petition.
When that is completed, representatives of the project will review total costs to make sure all costs are covered, including legal fees, bonding fees, engineering fees and other costs.
Kritzer said the county needs to make sure actual costs don’t overrun estimates.
More like this story
Use the comment form below to begin a discussion about this content.
Please review our Policies and Procedures before registering or commenting