The Seymour City Council will have a final reading Monday of a resolution to borrow millions of dollars from the city’s sewer utility fund should the need arise this year.
Last month, the council unanimously gave Clerk-Treasurer Darrin Boas initial permission to use up to $5 million from the account to pay city expenses until tax money is distributed later this year.
The first round of property and income tax revenues are expected to arrive sometime in June.
The loan from the sewer fund is temporary, and any money borrowed must be repaid before the end of the year. The action gives the city access to money interest-free to pay its bills instead of borrowing from a bank.
The request is not unprecedented, as the city struggles annually to meet its financial obligations while it awaits tax distribution, which occurs twice a year.
Jerry Hackney, chairman of the finance committee, introduced the ordinance.
“It’s not saying that we’re borrowing $5 million from the sanitation department,” he said. “It gives us the ability to borrow funds from the sanitation department up to a limit of $5 million, and it’s paid back once we get the tax distribution.”
He said it’s a measure the city has taken for years.
“Eventually, once our finances improve to where we don’t have to do that anymore, I hope we don’t,” he said. “But we have to get there first.”
Monday’s council meeting will be at 7 p.m. in council chambers at city hall, 301 N. Chestnut St. It is open to the public and press.
