Half a million interest savings forecast

City to refinance old debt
by Emmitt B. Feldner
of The Review staff

PLYMOUTH – The city is looking to save more than half a million dollars in interest costs by refinancing $6 million worth of bonds from 2006, 2007 and 2008.

Financial advisor Phil Cosson of Ehlers and Associates presented the particulars of the proposed new bond issue to the City Council Tuesday.

City Administrator Brian Yerges assured the council that the new bond will not include any new borrowing or debt, but will simply consolidate the outstanding loans.

While the major project covered by the three borrowings was the police and fire department additions at City Hall, Yerges said it also includes some projects for tax incremental finance district 4.

“This will help TIF 4 cash flow as well,” Cosson told the council.

The $6.055 million bond issue could save the city $515,238 in interest payments over the 10-year life of the issue, according to projections provided by Cosson based on recent bond issue interest rates.

“Even if rates pop up for a short time, we can pull the sale and revisit it at a later date,” Cosson told the council.

The timetable calls for the new bonds to be put out for sale in late April.

An application for a room tax permit for a proposed rooming house on Eastern Avenue triggered a council discussion on the city’s rules governing rooming and boarding houses and bed and breakfast establishments.

Building Inspector Pete Scheuerman explained that owner Cathy Faulkner is seeking the permit for her home at 1020 Eastern Ave.

“She came to Plymouth and fell in love with the city,” Scheuerman related. “She bought this place and renovated it. It’s going to be her summer home, but it’s going to be advertised as for rent,” through online sites such as airbandb.com.

He added that the home is zoned R-4 multi-family residential, as is much of the Eastern Avenue corridor, and that boarding houses are allowed in that zoning with occupancy limited to six unrelated persons at one time.

“Given the setting of the home and the amount of work put into it, I wouldn’t see any problem at all,” Scheuerman stated.

He noted that the city has already approved several other short-term rental situations for other residentialzoned homes.

“Were this in a single-family zone, it would be limited to four people,” City Attorney Crystal Fieber advised. “Because she’s renting this out for periods less than a month, she’s subject to the room tax.”

Alderman Jack Fernsler questioned whether there would be sufficient off-street parking available for the projected number of guests.

Scheuerman said parking could be regulated under a conditional use permit – which is required for such establishments in single-family zoning – but that the city’s zoning code does not require a permit for rooming or boarding houses in multi-family zoned areas.

“It’s going to be the obligation of the owner to convey that to renters,” Fieber said of winter and other parking regulations. “If there is an issue, it would be a problem between the owner and the tourists.”

“I would anticipate we may become more accustomed to this and see more of this in our community. I think this is going to become more and more prevalent,” Scheuerman said of renting out space to tourists and visitors in private homes.

“We have a wonderful community that serves the surrounding communities very well for events like the PGA, Road America, EAA and the like” Scheuerman pointed out.

“The city of Plymouth hasn’t been in a position to consider these issues,” Fieber conceded. “Maybe this is a policy consideration. The council may want to look at regulating these separately.”

Fernsler suggested tabling the room tax permit application until the council could look more deeply into the issue.

But Yerges noted that the council was only considering the room tax permit and not zoning issues.

“By not approving this (room tax permit), you’re not stopping them from using this as a rooming house,” Yerges explained.

The motion to table was defeated, then the council approved the room tax permit.

“We have two issues that popped up on something that we thought would be relatively simple,” Alderman David Williams commented. “Alderman Fernsler brought up some points on parking and other issues. We probably want to do some work looking at these particular ordinances and if they need some revisions, we should do so.”

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