Logansport City Council has decided to transfer a more than $570,000 surplus left over from the over-budgeted Ivy Tech Community College infrastructure project that concluded in 2010 to a fund used to pay off the bond on the project.
Logansport City Councilman Bob Bishop, who is also president of the Logansport Building Corporation, which oversees the Ivy Tech project bond, proposed the $570,467.12 transfer at a building corporation meeting in June. The measure passed 3-0. City council made it official with a 7-0 vote Monday.
The city’s previous administration originally had plans to put the surplus toward expanding the Ivy Tech infrastructure project to its $15 million to $20 million 18th Street improvement project, which would have spanned south from Broadway and included a roundabout at the intersection of 18th and Main streets.
During this time, before becoming a councilman, Bishop had spoken out against these plans at public meetings and campaigned on his desire to return the surplus to the sinking fund established to pay off the bond.
Citing Indiana Code, Bishop said when property taxes are used to pay off bonds, as is the case with the Ivy Tech project, any surplus proceeds must be paid back.
The city currently makes two $75,000 payments a year, funded by property taxes, on the $4 million bond for the Ivy Tech project. Officials have had to pull from the city’s rainy day fund in the past to make payments.
The 20-year bond will accrue more than $2 million in interest, bringing the total amount to be paid to more than $6 million. It is currently on track to be paid off in September of 2028. The transfer of the $570,000 surplus essentially provides more than three years of payments.
“This is taking the taxpayer off the hook for $570,000,” Bishop said.
The council was set to vote on a resolution appropriating $260,000 toward its own 18th Street improvement project at Monday’s meeting as well. The project is smaller than the previous administration’s. It sets out to improve drainage by replacing three box culverts along 18th, widen the intersection at 18th and Main and does not include a roundabout.