Supervisors approve resolution for jail project
Initial resolution gives board of supervisors authority to borrow project funds
By Steve Van Kooten
After the June 18 Crawford County Board of Supervisors meeting, the trajectory of the replacement jail project has become clearer, with multiple benchmarks set for the supervisor to meet in the coming months.
The jail project’s construction is expected to start in the late summer to early fall of this year, with an estimated two-year construction schedule.
With more than 60 percent of the drawings completed and the total project guaranteed maximum price (GMP) set at $35 million, the supervisors had to adopt an initial resolution to borrow money through bond issuances to pay for the new jail.
Carol Wirth, president and owner of Wisconsin Public Finance Professionals, clarified that the initial resolution does not mean the county has borrowed any money; instead, it gives the board of supervisors the authority to borrow money in the future.
“It’s a step in the statutes that says you can’t ever do a borrowing unless you go through this step first,” said Wirth, who acts as Crawford County’s municipal advisor and has worked with the county in a fiduciary capacity for more than 20 years.
“It’s required for the county to borrow in the future, but if the county adopted the resolution and never proceeded with the project, they never proceeded with the borrowing.”
The resolution had two restrictions: the money borrowed could not exceed the GMP, and any borrowed funds could only be used for projects outlined in the resolution’s purpose language.
Wirth said the county did not have to borrow the entire $35 million; the limit only prevents the county from exceeding the maximum price. Should the county require funds beyond $35 million, the supervisors would need to approve another resolution for the additional funding.
The resolution’s purpose language, written by the county’s bond counsel, Quarles & Brady, a law firm based out of Milwaukee, included two projects: the jail replacement project, which includes the remodeling of the current law enforcement center and the new addition to be placed on the county’s property in Prairie du Chien, and a new mobile command center for the county’s department of emergency management.
For financing options, Wirth said WPFP was “putting together a financial plan for the county” that included three phases of borrowing. In the first two phases, expected in August of 2024 and 2025, the county would borrow $13 million each, and in the third, expected in August 2026, the county would borrow the remaining funds necessary, which could not exceed $9 million.
Because the county is using general obligation bonds, Wisconsin state statutes only allow up to 20 years for repayment, but the county can extend the repayment schedule by two years using a three-phase financing plan.
General obligation refers to the county’s ability to repay the bond obligation through the collection of income, property and sales taxes.
As of June 2024, Crawford County’s debt service sits at $1,349,906. The estimated debt service from the project’s financing that will be added in 2025 is $1,741,804, which will make the county’s total debt service $3,091,710. Using the county’s 2023 equalized valuation of $1,788,550,500, the estimated tax impact was approximately 97 cents per $1,000 of equalized value, or $97 per $100,000 of property value.
Wirth said Crawford County has an A-1 investment rating. The rating is determined through a myriad of factors, including the county’s debt service, size, employment opportunities and fund balance, among several other components.“To have an A-1 rating is considered to be a very good rating for a county.”
According to Wirth, Wisconsin counties generally have favorable investment ratings.
In the coming months, the county will have to make several moves to get the project’s financing secured. On July 16, at a special County Board of Supervisors meeting, the WPFP will present a report on the project’s phase one financing, and the board will adopt a resolution to set the sale of the first $13 million in general obligation notes and direct the WPFP to prepare legal documents needed for the sale.
Throughout the rest of July, WPF and Quarles & Brady will prepare legal documents, including the official opinion.
On August 10, the WFPF will accept and verify bids from underwriters for the bond issuances. Ten days later, the board will adopt another resolution to lock in final interest rates and tax levy. Notes will be awarded to the successful bidders. At this point, the county has actually borrowed money, according to Wirth.
Finally, on September 9, funds from the underwriters will be sent to the county to be deposited in the project’s account.
Similar timetables will be expected for phases two and three over the next two years, though Wirth said those expectations were tentative. Time lines for the phases are expected to be presented to the board of supervisors in April of 2025 and 2026, respectively.
