By NEMS Daily Journal
Tupelo’s City Council, in the most important decision at its Tuesday night meeting, approved a plan that would allow the Major Thoroughfare Program to borrow money from the city’s reserve funds if timely construction projects’ costs exceed its money in the bank.
The borrowing, approved by a 6-1 margin after formal and informal discussions for several weeks among MTP leaders, Mayor Jack Reed Jr., the council’s members and members of the Major Thoroughfare Committee.
Borrowing, if it’s needed, would cover costs during times when the thoroughfare account’s demands exceed temporarily the tax revenues designated for it. The tax revenues were designated by the overwhelming approval of the city’s voters.
The underlying cause of the possible shortfalls is progress: contracts ready to bid for projects long-planned and long-sought – and some long-delayed.
MTP Chairman Greg Pirkle, in consultation with the larger committee, presented the proposal at a previous council work session and meeting. Tuesday’s vote was not a surprise issue. It had undergone thorough deliberation and had been approved as a reasonable, financially sound move by the city’s senior financial analysts.
Ward 3 Councilman Jim Newell was the only dissenting vote; he argued the decision was an abuse of cash reserves.
We could agree were the mechanism not in place to replace every cent that might be borrowed.
Ward 1’s Markel Whittington said it could save taxpayers’ money in the long term – a guard against inflation raising prices beyond bid amounts.
The MTP’s Phase 5 is making steady progress, and with the funds assured, progress will continue, including some projects that have been “on the books” for two decades.
Tupelo has about $17 million in its reserves. The MTP is Tupelo’s equivalent of a comprehensive highway program.
Pirkle, an attorney who, like other committee members, serves without compensation, has said it’s possible the program won’t need any borrowing, but if bids flow as has been laid out, it might be necessary.
Pirkle said MTP could need as much as $4.3 million. All will be repaid as the city collects the 10 mills annually designated for each five-year phase. The referendum-approved tax generates about $4 million per year.
The projects include the ongoing widening of South Gloster Street, the widening of East Main Street and the construction of a bridge over the Natchez Trace Parkway, which would help make the already-paved and completed northern loop operable as soon as a bridge over U.S. Highway 78 near Belden links the new road with Coley Road extended.