(The Center Square) — Mayor Tom Arceneaux urged the Shreveport City Council to reconsider funding allocations for the completion of Fire Station 20 in Monday’s administrative conference.
“I certainly support the funding and moving forward as quickly as possible for the reconstruction,” Arceneaux said. “My concern is the proposed source of the funding as written.”
The ordinance proposes taking $733,000 from the operating reserve to fund the project. The station reconstruction is estimated to cost $1.6 million. According to Arceneaux, the lowest bid from those rejected previously was $1.4 million, which will now be the target when bids go out.
The mayor asked the council to withdraw or defeat Ordinance 20, deeming it unnecessary. He also asked the council to amend Ordinance 21 to allocate funds from the unassigned premium funds instead of from the operating reserve.
Arceneaux disagrees with taking funds from the operating reserve. The council and administration have maintained an operating reserve of 8% of the operating budget. Rating agencies and bond insurers told the city that if the reserve were to drop below the pledged 8%, it could significantly impact the city’s credit rating, increasing borrowing costs.
If the ordinances, as worded, passed, it would drop the operating reserve below 8% having negative effects, according to Arceneaux.
The city is reportedly about to be able to sell bonds as approved by voters in 2021. The city made $88 million from selling the 2024 Proposition bonds in November. They also received a $2.9 million premium in addition to the $88 million. The premium on hand is not pledged or allocated to projects that comprise projects pledged from the $88 million.
“Using part of the $2.9 million to complete Fire Station 20, a capital project, not an operating budget project, is an appropriate and legal use of the premium funds for Proposition three of the 2024 bonds,” Arceneaux said. “It does not take away from any proposed project and it does not use operating reserve funds.”
Fire Station No. 20 has been out of commission since August 2023 when mildew and mold were found forcing firefighters to work from different stations in the city. After Fire Chief Clarence Reese updated the council on the cost in March, the council is now prepared to vote on the funding needed.
An amendment was prepared for Arceneaux’s changes in hopes that one of the council members would sponsor it. The council is set to vote April 8 on the ordinances.
