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On Riverfront: ‘City should move on’

Riverfront Commission not expected to pay back city for work

Jay Vanbruchhaeuser performs on the Dixon riverfront Friday afternoon during the weekly Musical Fridays.
Jay Vanbruchhaeuser performs on the Dixon riverfront Friday afternoon during the weekly Musical Fridays.

DIXON – The Riverfront Commission owes the city more than $1 million for the Heritage Crossing project. Maybe.

Any reimbursement deal, however, seems to have been no more than the idea of a former commissioner who had an optimistic forecast of fundraising for that project.

Sauk Valley Media could find no city record that acknowledges the deal, and no record of official action by the Riverfront Commission or City Council to approve such an agreement.

Now, since Riverfront fundraising money has gone for maintenance, the city is footing the bill, and that’s fine with Mayor Jim Burke and at least one commissioner.

Will the Riverfront Commission ever pay back the city?

“I think the city should move on,” Burke said. “How do you draw a line between the Riverfront and the city? The city owns the whole thing. If the commission is able to raise money for it, that’s fine, but as I see it, it’s worth every penny.”

The city contributed about $2.62 million to the project, according to reports filed by Former City Engineer Shawn Ortgiesen.

In March 2008, the city sold a $6.5 million bond at 4.05 percent interest, with a 20-year payback, to cover infrastructure projects.

Of that, about $1.8 million went for the Riverfront project. Also, the project got about $820,000 from the city’s motor fuel tax fund, Ortgiesen’s records showed.

In a February 2010 article published by Sauk Valley Media, Riverfront Chairman Larry Reed and then-Finance Commissioner Roy Bridgeman acknowledged the Riverfront Commission would not have the money upfront to pay for construction.

Documents show the city paid at least $5.5 million of project funds to Fischer Excavating, Wendler Engineering Services, DJ Sickley Construction, Ogle County Highway Department and Armbruster Manufacturing, according to requisitions and carbon copied checks.

A federal transportation grant provided $2.32 million, and the Riverfront received about $755,000 in pledges from individuals, businesses and organizations.

It is not clear from documents and meeting minutes how much of the $755,000 was used to pay back the city for riverfront work, but former Treasurer Jean Millar told the commission at past meetings that payments were being made as the pledges came in, according to Riverfront meeting minutes.

The city will owe $4.76 million after it makes a $500,000 payment this fiscal year on the 2008 bond, according to documents provided by city Finance Director Paula Meyer.

In February 2009, Bridgeman told Sauk Valley Media the Riverfront Commission would be expected to pay back its portion of the bond within the next 20 years.

“Money is very tight right now,” Bridgeman said then. “But over the period of time that we have to pay back that bond, things should change. I think the majority of people are good Dixon citizens, and they’ll back [the riverfront project].”

Reed added: “If we don’t raise another dime, the city would be holding the bag, but that’s certainly not what we’re anticipating at all.”

Reed said the Riverfront still intended to pay back its portion of the bond, even though it cannot make payments today.

To have paid back its portion of the loan, the Riverfront Commission would have had to reimburse the city about $138,000 this fiscal year. It paid nothing.

“I’ve always said we should earmark that debt into our next project,” Reed said. “That way, when we go for another funding campaign, we’ll be able to pay it.”

The Riverfront is in talks about adding boat docks to Heritage Crossing, which would cost about $153,000. Right now, the commission has raised $4,665 and is seeking state grant money.

That estimate does not include any payback of the 2008 bond.

But no one seems certain of what that payback would be.

That’s because, Meyer said, she is unaware of any formal agreement made by the Riverfront Commission to pay back the portion that financed riverfront work.

No action on that matter was taken in meetings of either the Riverfront Commission or City Council, according to a review of meeting minutes dating back to 2008.

Mayor Burke said the idea that the Riverfront owed the money in the first place was started by Bridgeman’s comments to Sauk Valley Media, but that was not a consensus of the City Council.

“Nobody else made any comment about the Riverfront having to pay back that money,” Burke said. “I think it’s worth every dollar and every cent that has gone into it. It’s transformed the downtown, and it’s actually transformed the community.”

Sauk Valley Media has been unable recently to reach Bridgeman for comment. Calls this week have not been returned.

Finance Commissioner David Blackburn, who was the only other commissioner on the City Council at the time of the 2008 bond, said even if the city asked the Riverfront to pay back its portion of the bond, the city has no right to recover it.

The Heritage Crossing technically is city property. The commission is just a spoke of city government.

Commissioner Dennis Considine said he felt it was important for residents to know the city is paying its share for past projects.

In total, the city owes more than $30 million in bonds, including those issued by the sewer and water funds, which are separate from the city’s general fund.

“I just wanted people to know how much money came out of those bonds,” Considine said. “I think the Riverfront has turned into a great thing for the city, but the city has outstanding debt for the sewer plant, the water plant and the public, health and safety building, and the Riverfront.”

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