Lengthy discussions of economic development bonds and dominated Monday’s marathon Rockville City Council session.
Here’s a review of some of the business that the council tackled during a meeting that stretched into the wee hours of Tuesday:
National Lutheran Home bonds
The council voted 3-2 to issue economic development bonds on behalf of the & Village at Rockville, Inc.
Mayor Phyllis Marcuccio and Councilwoman Bridget Donnell Newton voted against the issuance.
The city will issue up to $25 million in bonds, but would assume no financial liability should the lender default, according to city staff.
The issuance will not affect the city’s ability to issue debt, staff wrote in a report to the council. It could, however, make it more difficult to receive a competitive interest rate if the city finds it necessary to issue bonds totaling less than $10 million during 2012, staff wrote.
The vote came the same night the council began discussions of guidelines for economic development bonds. The council decided to delay until a later date a broader discussion of the city’s financial management policies that was on the agenda.
The National Lutheran Home, a nonprofit corporation, will use the bonds to finance a project that would add assisted living facilities—but would not add buildings—to The Village at Rockville, at 9701 Veirs Drive.
Raymond James & Associates, Inc. will purchase the bonds and immediately sell them to an accredited investor, Hamlin Capital Management, LLC, according to James E. Cumbie, an attorney with Venable LLP who serves as the city’s bond counsel.
Marcuccio said she is “all for” the bond issuance but couldn’t vote for it without a policy in place.
“You can’t apply a policy you don’t have yet,” she said.
Newton said she opposed the proposal “on principle” because the council had “not been given all of the facts in a timely fashion.” Newton said she has concerns that the council “doesn’t have the financial background and knowledge ourselves to ask the good questions.”
Hall said he voted for the bond issuance because he thinks “there is a public purpose advanced by this” and that the new policy on bond issuance shouldn’t “come at [the National Lutheran Home’s] expense.”
Still, Hall said: “I find this the wrong way to have come up with this.”
Pierzchala said he voted for the issuance because he “saw virtually no risk for the city” and “a wonderful nonprofit citizen of the city” in the National Lutheran Home who answered questions about the transaction “before they were asked.”
“I think whatever we’ll eventually have in our policy is already covered by this deal,” he said.
Silverwood court cases
The council voted 4-1 to have the city attorney represent Rockville in two legal challenges to a proposed mixed-use project across Frederick Road from King Farm.
Marcuccio voted against city participation in the cases.
Silverwood/Shady Grove LLC is seeking to build a six-story 417-unit multifamily building with ground floor retail on the 4.3-acre former Reed Brothers Dodge site at 15955 Frederick Road.
King Farm resident Cathy Scott and former Rockville Mayor Larry Giammo have filed separate petitions for judicial review of decisions by the city. Scott's seeks a review of the council's decision to annex the property. Giammo's seeks a review of the city Planning Commission's approval of the project.
The council voted unanimously to adopt a change to the definition of “family” in city zoning.
The new definition applies to married couples, blood relatives and unrelated people living as a “single housekeeping group.” The intent of the definition is to distinguish single-family homes from “rooming houses, boarding houses or multi-family dwellings,” which are prohibited in parts of the city zoned for single-family residences.
Bathhouse project to be rebid
The council voted unanimously to reject eight bids to renovate the bathhouse at the outdoor pool at the . The budget for the demolition of the 43-year-old bathhouse and construction of new facilities is $715,000. Contractors’ bids received last year range from $957,777 to $1,371,817, according to the staff report.
The city will rebid the project in the spring so that demolition can begin after the pool closes for the summer season in early September.
Newton said she wanted to expedite the process so that the renovation could be completed this year.
Burt Hall, the city’s director of recreation and parks, said that while the renovation is “badly needed,” starting the project this late in the offseason poses a “very, very large risk” that it might not be completed by Memorial Day weekend, forcing the city to delay the pools' opening.
Code requires the facility to have a certain number of toilets available for pool patrons, Hall said.
The city considered renting portable facilities but the code requirements made that idea impractical, Hall said.
The portable facilities “would have to be almost as large as the existing facility,” he said.
The council will not meet on Monday, as City Hall will be closed for Martin Luther King Jr. Day.
The council will hold a public meeting at 7 p.m. on Jan. 18 to discuss the search for a new city manager. City Manager Scott Ullery retired last month.
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