BATH — The city’s tardiness in publishing a proposed borrowing plan last November means the state Legislature must ensure the marketability of the now-approved bonds is not compromised.
It is the second time in recent months that the city has missed a bond-publishing deadline, requiring approval of the borrowing to be revisited.
“We have to take steps to shore up the process,” City Manager Peter Owen said Feb. 21.
He said he hopes LD 1828, “An Act to Validate Certain Proceedings Authorizing the Issuance of Bonds and Notes by the City of Bath,” will be approved this spring. The bill is sponsored by Rep. Jennifer DeChant, D-Bath, and Sen. Eloise Vitelli, D-Arrowsic.
City voters on Nov. 7, 2017 overwhelmingly approved a $2.8 million local bond for street and sidewalk improvements. The City Charter requires the complete bond ordinance text to “be published in a newspaper of general circulation in the city” between 10-15 days before such a vote, but publication occurred only four days prior to the election, according to the Legislative bill.
“As a result, it wasn’t properly published,” Owen explained. “And therefore, it ends up not being capable of being certified by the bond attorney.”
Failing to publish the text as the charter requires “creates a legal technicality that could affect the marketability of the bonds or notes to be issued by the city in connection with the projects,” the bill states, noting that the circumstances “create an emergency within the meaning of the Constitution of Maine.”
“The solution was to go to the Legislature, and have them approve the referendum,” because the Legislature can override the charter requirement, Owen said.
Otherwise, the city would have to vote on the ordinance again this June. If that is necessary, “we would lose potentially the ability to spend that bond this summer,” Owen said. “We want to start doing projects this summer, so this is the avenue we’re taking.”
A special election is another option, but that would cost extra money, and Owen said he would prefer not to have taxpayers pay for the mistake.
The city missed the required publication window due to “a clerical error,” Owen said, declining to identify any particular staff person responsible.
A similar situation occurred last December, when the council had to approve, for the second time, borrowing $621,000 for several capital improvement items. Although the council had previously approved the bond in two separate votes that spring, as the City Charter requires, the city had failed to publish a “notice of final passage” in a newspaper within 10 days.
“We are taking steps internally to make sure this doesn’t ever happen again,” Owen said. That does not impact anyone’s job, he noted, but is “just clarifying procedures. What needs to be done, and having someone else check on it.”
The City Council is due Wednesday, March 7, to vote on a resolution in support of the bill. The Joint Standing Committee on State and Local Government is scheduled to hold a work session two days later.
“The Legislature wants to see the council has approved this, the concept of it,” Owen said.
The city needs a decision by July, “but we’re hoping for something in March,” he added.