Council approves $63.5 million IRB for HP

By Eric Maddy
The SCORE

The Rio Rancho city council unanimously adopted an ordinance authorizing the issuance and sale of $63.5 million in industrial revenue bonds to “provide funds to finance the acquisition, constru tion and equipping” Hewlitt-Packard’s new facility..

By using the city as a conduit for the bonds, Titan City Center LLC will qualify for certain tax breaks in financing the HP facility, finance director Dick Kristoff said. The city will make no money on the bonds and have no responsibility for repayment.

Titan will make 20 interest payments of a maximum of $2.54 million in starting May 1, 2010 through May 1, 2029, a four percent rate. Titan will also be responsible for paying the $63.5 million principal on the last payment date.

David Buchholtz, an attorney who represented Titan, said the plan will allow the company to qualify for the abatement of some property taxes, though Titan will make a payment in lieu of taxes to support the Rio Rancho school system. Bucholtz said gross receipt taxes on materials and supplies used in the project will be paid to the city.

Also, city administrator James Jimenez said he plans to present a plan for how the city will spend the $10 million designated for Paseo del Volcan that was approved as part of the Tuesday’s general obligation bond election. With the announcement last Friday that the federal government will give the city $14 million for PDV as part of the national stimulus package, $10 million from the bond issue will now be spent on other road projects in the city.

Jimenez said he is not sure if the city will sell its bonds on the open market or through the New Mexico Finance Authority.

In other business, the council:

• Selected councilor Delma Petrulo as deputy mayor.

• Approved the re-appointment of Jan Marfyak to the Library Board of Trustees and the appointments of Catherine Jabar to CIPCAC and Ken Alderson to the Visual Arts & Cultural Enrichment Task Force.

• Approved an application for transfer of ownership and location of a liquor license to be used at a new Walgreens outlet being constructed on the northeast corner of Northern Boulevard and Unser Boulevard.

• Approved three zoning changes, two in Unit 13 and one in Unit 12.

• Approved an annual resolution establishing its meeting schedule and adopting procedures regarding notice of meetings.

• Heard a report from Parks and Recreation Commission chairman Thomas Golder on accomplishments in the last year. Despite limited funds, Golder said there were seven ribbon cuttings on park renovations and two more for new parks. He also noted the commission reviewed plans for four parks last year and will soon be opening its fifth dog park in the Cabezon area.