Economy

NC's Mecklenburg county could face bond debt problems

Wall Street's troubles could delay dozens of public construction projects across Mecklenburg County, including the opening of four new elementary schools.

The county is among many local and state governments nationwide struggling because of the upheaval in the financial markets.

The reasons: the cost of some of the county's current debt has jumped, and the county is concerned it won't be able to sell more bond debt as investors look for safer havens.

County commissioners are expected tonight to consider borrowing up to $375.6 million in January for schools, parks and libraries. Voters last year had approved bonds for much of the spending.

But if there aren't enough buyers for the county's bonds at affordable rates, the county would only seek about $234.3 million.

Borrowing the lesser amount would pay to finish projects already under way. No new work would start until the county borrows more money, officials said, which could happen this summer.

Charlotte-Mecklenburg schools stand to lose the most – $99 million – if the county borrows less.

Even though bond interest rates have recently declined some – which is good for municipal borrowers – many local leaders are still cautious.

Mecklenburg's Finance Director Dena Diorio said officials will decide closer to the sale date how much the county intends to borrow.

“We're hopeful and confident that we should be able to get the full amount, the full $375 (million),” she said. “But I can't predict what's going to happen in the market.”

Read the complete story at charlotteobserver.com

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