LYNN — The city was given the go-ahead on Wednesday morning from the state’s Municipal Finance Oversight Board to seek bonds for three projects under the state’s AA-plus rating via The Qualified Bond Act.
Chief Financial Officer Michael Bertino met with the Municipal Finance Oversight Board (MFOP) via a phone call. State Auditor Suzanne M. Bump serves as the chair of the MFOP.
Bertino told Bump and the rest of the board that the city has been moving in the right direction fiscally over the past four years since the city received a $14 million loan from the state to fix its financial problems.
“We are in a much, much better position and hope to continue that in the future,” Bertino told the board. “We created stabilization accounts to firm up financial spending and made substantial investments in our capital program.”
Bertino also told the board that the city’s bond rating was upgraded to A-plus by the Standards & Poor’s rating system on Tuesday.
Mayor Jared Nicholson, who was also present at the meeting, said the A-plus rating highlights the city’s progress in handling its finances.
“Standard & Poor’s upgrade to A-plus is great news for the city and an encouraging affirmation that we continue to head in the right direction,” said Nicholson. “We have made drastic progress over the last four years to improve our financial standing and outlook.”
By seeking the bonds under the state’s rating, bond sellers would see that the state views Lynn as a trustworthy, low-risk bond buyer able to pay off its debts. Additionally, the higher the bond rating, the less interest the city would have to pay back to the seller of the bond.
The three items the city wishes to seek bonds for are repairs for the Lynn Vocational Technical Institute, and the takings of a former Century Bank building at 2 State St. and a building owned by Element Care at 37 Friend St. through the use of eminent domain.
The repairs for Lynn Tech would cost $14.15 million and the values of the two properties are $1.5 million for the Century Bank building and $3.1 million for the Element Care building, for a total of $18.75 million in state qualified bonds.
During the meeting, Bertino explained to members of the board the value of the three projects and how they would help Lynn financially. According to Bertino, the taking of the two buildings would help create more space for city employees and build a senior center for the city while also decreasing congestion.
“Our tentative plan for these two buildings is to rebalance school offices, create a senior center and relocate our regional 911 call center space,” Bertino told the board. “That way, we can house more children to alleviate the congestion in the city.”
Bertino said they would not evict any tenants from the buildings. The Century Bank building currently has a child legal services firm as a tenant, which has a 10-year lease with the owner of the building.
The City Council authorized the city’s Law Department to draft a 30-day notice of intent letter on Feb. 22. The letters sent to the owners of the two properties read that the city is considering using eminent domain — the government power to take private property for public use — to take the two buildings. The council is expected to consider taking up a vote on whether or not to use eminent domain on April 12, but could do so earlier if the owners choose to waive the 30-day deadline.
Improvements to Lynn Tech have been going on since 2019, according to Bertino. Of the $14.15 million being spent on this project, the city will receive $8.8 million back from the Massachusetts School Building Authority (MSBA) as part of its accelerated grant program.
Despite the approval from the Municipal Finance Oversight Board, Bertino said there are still discussions to be held about the projects.
“One-hundred percent of the decisions haven’t been made yet,” Bertino said. “We still need to have talks with the City Council to make sure we are all on the same page.”
