North Port poised to put borrowing, debt to referendum

Each time the city of North Port wants to borrow money or incur debt, voters must authorize it, based on the city charter. That could change in the event of an emergency or for projects less than $15 million, if voters give it the OK in November.

The city is seeking voter approval to change the charter through referendum. That way, North Port, officials saty, could issue debt payable from funds other than property taxes for safety and public health projects with a maximum principal amount of $15 million or respond to a declared emergency or disaster.

When North Port was incorporated in 1959, the city charter stipulated that voter approval was required to fund large projects. However, the “pay-as-you-go” approach has led to increasing costs over time, as it extends the timeframe for projects and requires residents to foot the up-front cost.

For example, when the city needed to widen Price Boulevard, it was estimated to cost $3 million at first. However, by the time voters authorized the city to use bonds to pay for the road widening a decade later in 2022, the cost had skyrocketed to $80 million.

North Port also missed out on the ability to get state and Florida Department of Environmental Protection loans in the aftermath of Hurricane Ian due to the need for voter approval, officials say. 

Now, the city has created a referendum website with information about the proposal, which stipulates that commissioners could approve borrowing in the event of an emergency or disaster or for safety and public health project up to $15 million without getting voter approval.

On July 9, the North Port City Commission unanimously approved an ordinance on the first reading to place the referendum on the Nov. 5 ballot. A second reading will occur at the commission’s next regular meeting at 10 a.m. July 23. 

Should the city be given permission to borrow for emergencies or for projects up to $15 million without putting it to the electorate for a vote, a majority of the City Commission would still need to approve any borrowing or incurrence of debt in at least two public hearings, officials say.

Bonds paid back using property tax revenue would continue to require approval through voter referendum in a general election.

Commissioners also directed staff to develop a debt management policy to ensure responsible, affordable use of debt financing for the city's capital needs. Tentatively, the debt management policy is scheduled for discussion during the Sept. 9 commission workshop.