CHARLOTTESVILLE, VA (CVILLE RIGHT NOW) – The Albemarle County Economic Development Authority voted unanimously to allow the Board of Supervisors to move forward with a $156.55-million bond issuance to fund capital improvement, a refund of the bonds for the Rivanna Station Futures Property, and a refinancing of a 2015 bond issuance, on Tuesday.

The Board of Supervisors is expected to vote on the plan at its Wednesday meeting. Rivanna District Supervisor Bea LaPisto-Kirtley attended Tuesday’s EDA session.

Using a financing framework that has been in place in the county since 2003, the new bonds would cover $118.14 million in capital improvement projects, $26.36 million for the refund portion of the 2023 bonds for the Rivanna Stations Futures property, and $12.05 to refinance the 2015 bond issuance, according to a presentation to the EDA by the county’s chief financial officer, Jacob Sumner.

Much of the CIP money will go toward public education, including $58.9 million to pay for the construction of Mountain View Elementary School and the ACE Academy at Lambs Lane, both of which are on pace to open in August, and $19 million for other school renovations and maintenance.

The new courthouse project and the Biscuit Run project also accounted for large portions of the money.

Phil Riese, chairman of the Albemarle County Republican Committee, spoke against the bond measure at Tuesday’s meeting, arguing that incurring that level of debt should be a decision put before county residents in a vote.

“I don’t think it’s in the best interest of the county,” Riese told the EDA during public comment Tuesday. “It doesn’t give the voters a say in it.”

Riese said a “legal loophole” would allow the county to do the bond issuance without putting the issue before the voters, but said that the process violates “the spirit” of the Virginia Constitution. He also said issuing General Obligation bonds would get the county a better interest rate and cost taxpayers less.

Riese said he did not oppose the projects the bond offering would be paying for. But he did not believe an Economic Development Association bond was the proper way to fund those items.

County spokesperson Abbey Stumpf told Cville Right Now that “typically, the interest rate differential between a GO issuance and the EDA issuance is between 10 and 25 basis points. The current market differential is even less at around five basis points.”

Sumner told the EDA that a “referendum is a much more elongated process.” He said going that route would add months to the process. The delay getting to market would expose the county to potential negative rate changes and continued inflation.

But Riese argued the wait would be worth it.

Riese told Cville Right Now that Sumner had presented the EDA with “the best-case scenario” when he estimated 5 basis points for the bond issuance. Riese said he believes the county could face anywhere from 10-20 basis points on the bond measure.

He said this financing method could end up costing taxpayers over $11 million over the life of the bonds.

The GO bonds have generally been used for projects that have not already been approved and started, giving voters the chance to decide what projects get funded. In this case, the projects are already underway and the county is deciding how to, essentially, pay its bills.

But Riese argued that just because that’s the way the county normally proceeds does not make it right.

According to Riese, the county has taken on about $260 million in debt since 2021, without holding a bond referendum to gain voter approval. He said the Capital Improvement calls for the county to borrow another $343.9 million over the next five years.

Riese pointed to the fact that, in 2016, the county held a voter referendum on a $35 million bond for a school, which passed.

“If voters supported borrowing then, why not give them the opportunity to vote again?” he said.

If a voter referendum failed, the projects that are ongoing would need to be delayed and the county could see its bond rating drop, two other factors for the supervisors to continue Wednesday.

“The credit markets typically would want to see at least two years between the time of the initial referendum and the next time the locality goes to market to issue debt for those projects,” Stumpf said.