Local banks could loan the City of Decorah the $3.5 million needed to pay for the Short Street project

A group of local banks led by Decorah Bank & Trust might lend the City of Decorah the $3.5 million needed to pay for the Short Street project.

Decorah banker Ben Grimstad has been in discussions with city officials about financing the project locally.  The concept received a warm reception Monday night at a Decorah Finance Committee meeting.  "I like the option of local (financing)," said city council member John Franzen.  Other city council members agreed.

Finance Committee members also spent time discussing how to cover the loan payments.  They agreed with a staff recommendation to use local option sales tax revenues, which amount to around $850,000 in revenues each year.  The money is designated for road projects.

Loan payments of between $370,000 to $450,000 a year would use around half of each year's LOST receipts.  That would mean there wouldn't be a lot of money left over to use to finance payments for other road projects.  But, as Finance Committee Chair Paul Wanless noted, "That's why we passed (the local option sales tax)."