Conshohocken Borough Council borrows $10.8M for new borough hall

Conshohocken Borough Council approved borrowing $10,781,000 from two banks Sept. 17 to pay for the construction of the new Conshohocken Borough Hall, police station and retail space in the former Verizon building at West Fourth Avenue and Fayette Street.

Christopher Gibbons, a principal of Concord Public Finance, described the three 25-year bank loans, which will have fixed rates for seven years and variable rates for the balance of the loans.

Fulton Bank will lend $6,781,100 in tax-exempt funds at 2.86 percent interest for seven years and at a variable rate, from 3.5 percent to a maximum rate of 6 percent, for the remaining 18 years.

Phoenixville Federal Bank & Trust will lend $2,630,700 at 1.99 percent interest for seven years and at a variable rate, from 3.84 percent to a maximum rate of 4.75 percent, for the remaining 18 years.

Phoenixville Federal Bank & Trust will also lend $1,369,300 in taxable funds at 2.75 percent interest for seven years and at a variable rate, from 4.34 percent to a maximum rate of 5.99 percent, for the 18-year balance.

We are planning to use a bank financing to do it as inexpensively as possible, Gibbons said. We went out to 35 banks and got 30 proposals.

The total amount borrowed will be $10,709,600 with borrowing costs of $71,500, Gibbons said.

The annual debt service will start at $312,619 in 2015 and increase to $719,766 per year in the subsequent 24 years of the loans.

But borough officials said the $719,766 in annual debt service would be decreased by eliminating the annual $240,000 that the borough currently pays for its office rental at 1 W. First Ave. The borough also expects to receive about $225,000 per year when all of the 20,000 square feet of rental space is occupied in the new borough office building.

This proposal is a great opportunity, Gibons said. Continued...

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Conshohocken Borough Council borrows $10.8M for new borough hall