Mall purchase still hitting taxpayers

The city has lost more than $500,000 in interest payments because officials tapped more than $5 million from Bristol’s rainy day fund to purchase the mall almost three years ago.
City Comptroller Glenn Klocko said that borrowing the $5.3 million purchase price from the rainy day fund made it possible to avoid selling bonds to finance the deal but it also caused the city to lose the interest it could have earned on the cash.
He said the city is losing about $250,000 annually in interest it would otherwise have earned because the money is tied up in the 17-acre mall site.
In a related issue, a separate account to deal with the direct costs of owning the mall has run short of cash.
Klocko said the mall property brought in $354,000 in revenue – from rents, mostly – during the most recent fiscal year. But it cost the city $391,000 to care for the property, he said.
Because some state cash was added in during the year, the fund was short only $6,000 at the end of June, Klocko said, but the deficit has grown larger in the past six months.
Still, he said, “It’s clearly manageable.”
The Bristol Downtown Development Corp. , which was given responsibility for the mall site last year, is planning to seek a private developer this year who can build stores, office and housing on the property.
The city plans to reimburse the rainy day fund for the $5.3 million purchase price whenever the land changes hands again, though the terms of any deal have yet to be worked out.

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Copyright 2008. All rights reserved.
Contact Steve Collins at scollins@bristolpress.com