Midvale to bond for $6 million in road improvements

MIDVALE — The City Council is pursuing a revenue bond of up to $6 million for construction of intersections and citywide road improvements.

Three new intersections in the Bingham Junction development could be built with the money, according to city finance director Laurie Harvey. The multiuse retail and residential project is transforming a former smelter site into prime property that will eventually be accessible by light-rail trains.

The city has agreed to pay for the intersection improvements at the request of WinCo Foods, which plans to build a grocery store in the area. The store could bring in 90,000 cars a day plus much-needed sales tax revenue, said Mayor JoAnn Seghini.

Doing roadwork now is expected to create jobs and save Midvale money on material costs such as asphalt.

Midvale's move toward bonding follows in the footsteps of cities such as Murray and Holladay, which have recently taken out bonds for road projects. Utah's capital city also is pursuing bonds as it grapples with lower-than-expected revenues.

In Midvale, the $6 million in bonds is expected to be repaid with fuel tax revenues. As yet, it is too early to know whether Midvale will receive federal stimulus dollars for transportation, Harvey said.

Cities in good financial shape with pressing needs are in a good position to pursue bonds right now, said Preston F. Kirk, senior vice president of George K. Baum & Co. Many stock buyers have transferred their investments to safer, municipal investments as the global economy has declined, thereby lowering interest rates for borrowers, he said.

Beyond pursuing bonds, Midvale has cut its department budgets across the board and is dipping into rainy-day reserves. The council also unanimously agreed to lend general fund money to a special account that ultimately gives developers property tax breaks in exchange for improving dilapidated areas.

The City Council will hold a public hearing on the bonds on March 17. The money could be issued by mid-April.

E-mail: rpalmer@desnews.com