BY VINCE ECHAVARIA
Staff Writer
KEYPORT — The Borough Council plans to finance the remaining construction costs of the new borough hall.
The council issued $2.7 million in bonds Feb. 17 to temporarily fund upcoming projects, including the remaining costs of the new municipal building on West Front Street.
The council bonded about $950,000 of the bonds to cover costs to complete the borough hall building. The additional costs include furniture, communications equipment, and other expenses, borough Chief Financial Officer Thomas Fallon said.
"We don’t need all that cash, but we will see how much cash we need to cover the remaining costs," said Councilman Robert Bergen, head of the finance committee.
The bonds allow the council to take advantage of a low 1.2 percent interest rate, he said.
Mayor John Merla said the low interest rate will save taxpayers a significant amount of money.
"The borough’s plan to permanently finance these projects will allow the borough to take advantage of a great interest rate environment and lock in a low interest rate for borough taxpayers," Merla said.
The borough hall building opened its doors for business in early January, a few months behind schedule. Merla said the building’s total costs have exceeded $4 million, after initially being estimated at around $3 million.
Merla said he did not think $3 million would be enough money to complete the building.
Bergen said the $3 million estimate was a preliminary figure made before the project was sent out to bid.
"Everybody knew it was going to cost much more than that, but that’s all we needed at that time," Bergen said.
Although Bergen said the building was probably under-funded, the council was not aware of eventual additional costs, such as furniture and technology equipment, including computers.
The bulk of the construction costs, about $3 million, have been paid off, with only minimal payments left unpaid, Fallon said. The building, which was funded through bonds, will be paid off over the next 30 years, Bergen said.
The final cost of the building is not unusual for such a major construction project, Bergen said.
"Large construction projects usually cost more than what you initially anticipate," Bergen said. "In terms of the costs, I don’t think it’s grossly over what we probably thought it would cost."