COLUMBIANA CO. Officials mull using tax to pay on loans

The loans being considered for expedited repayment cost about $1.2 million annually.
By NORMAN LEIGH
VINDICATOR SALEM BUREAU
LISBON -- Columbiana County commissioners are considering using revenue from a sales tax increase to pay on the county's debt.
Three outstanding loans are candidates for the county to pay extra on over the next few years to retire the obligations more quickly.
Doing so would save the county money on interest and get it out of debt sooner, commissioners said Wednesday.
An estimate on the possible savings hasn't been compiled yet, commissioners said.
Commissioners will work with the auditor's office to compile a savings estimate, if a decision to accelerate repayments on some loans is made, Commissioner President Jim Hoppel said.
The specifics
One of the loans is a $10.6 million jail construction loan taken out in 1997 and set to mature in 2024.
The interest rate on the loan varies between 4.15 percent and 5.25 percent. The county, which still owns about $9.7 million on the debt, will have a 2003 payment on the obligation of $734,612.
Also being considered for expedited repayment is a $7.2 million state loan the county took out in 1994 as a result of a 1993 investment scandal.
The county needed the cash after former county Treasurer Ardel Strabala and his son, Stephen, bilked the county out of nearly $10 million through illegal investments.
The county recovered some of the lost money from the scandal, which was revealed in September 1993, but it needed a loan to make up for the balance.
The county still owes about $2.2 million on the loan, which bears a 3 percent interest rate and a 2008 maturity date. The county pays about $356,000 annually on the obligation.
Also being eyed for accelerated repayment is a 1996 loan of $1.1 million through the Ohio Water Development Authority.
The 25-year, 6.04-percent interest loan was taken out in 1996 to pay an engineering firm to design a sanitary sewer system to serve the Hanoverton, Kensington and Winona areas.
Although the engineering was done, the sewer was never built because residents affected by the undertaking voted not to participate in the sewer construction project.
It's costing the county about $92,506 a year to pay the loan.
Tax plan
To pay down the three loans, the county would use at least part of the nearly $300,000 in annual revenue expected to be gathered from the 0.5 percent sales tax increase imposed in June.
Before a decision to accelerate repayments is made, commissioners must first ensure that county departments are adequately funded and that the county has caught up on debts that it has fallen behind on over the past year or so, Hoppel said.
It may be well into next year before commissioners are at a point to decide if loan repayments can be expedited, Hoppel said.
leigh@vindy.com