December 16, 2011
County settles on radio upgrade payments
Cortland County Budget and Finance officials Thursday endorsed a proposal to lease about $10.9 million in equipment and bond for about $3.3 million to finance the county’s approximately $14 million emergency communications upgrade.
The full Legislature will vote on the plan Thursday.
The county has contracted with Motorola to bring it into compliance with the Federal Communications Commission mandate that all radio systems be upgraded by 2013.
The county is finalizing site acquisitions between private property owners and plans to enter the construction phase of the project in the spring of 2012. Studies of the land will be done over the winter to determine what will be needed to properly secure the towers.
The bonds would pay for towers and infrastructure costs. All equipment would be leased from Motorola and the county would make payments to a financing agency Motorola hires.
This arrangement allows the county to defer bond and lease payments until 2013.
If the county did not lease equipment it would have had to pay Motorola a lump sum of $2.4 million in January 2012, which was not budgeted. The county has intended to lease with Motorola, but County Administrator Martin Murphy proposed the exact payments for the first time Thursday.
Starting in 2013, the county would make lease payments of about $1.4 million annually, Murphy said. The bond would be paid over 25 years in average annual payments of about $185,000.
The bond payments would come out of the county’s general fund. The lease payments would be an annual budgeted expense with the hopes that the county would secure grant funds each year to offset those costs.
Murphy had originally proposed bonding for about $10 million and leasing for about $4 million, but Information Technology Director Rob Corpora advised him to lease for the larger amount of money.
The county can put any grant funds it is awarded toward the lease payments, but not toward bonding. The grants the county is applying for can be used to pay off expenses but not debt, said Corpora.
The county is applying for three grants of about $2 million each.
It is applying for three separate categories of grants from a $20 million pool of funds available statewide from the state Division of Homeland Security and Emergency Services. The money was raised through cell phone surcharges and is designated to help offset costs of the federally mandated communications system upgrade.
The county has been awaiting word on whether it was awarded any money since the summer. Officials do not know when an announcement will be made.
Murphy said he is “cautiously optimistic” the county will receive at least two of the grants.
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