Medina officials worry government shutdown could hold up USDA loan for new fire truck

This photo posted by the Firematic Supply Company shows a new ladder truck being built for the Medina Fire Department. The photos, which were posted Oct. 17, offered a weekly progress report on the truck. Firematic, a dealer for Pierce Manufacturing, reported that the torque box was merged on the chassis followed by body installation at the start of initial apparatus assembly. The next report may show completed initial assembly and the beginning of the final assembly.

MEDINA – A new concern has emerged with the village’s quest to acquire a new ladder truck: Will the federal government be functioning to approve the loan to pay for the truck?

Medina is getting close to receiving a new ladder truck from Pierce Manufacturing in Wisconsin. The truck was scheduled to be delivered to the Medina in December, but it looks more likely for January, said Fire Chief Steve Cooley. Village officials were aiming to have a new addition on the fire hall to accommodate the new truck, which won’t fit in the existing building. The truck is taller and will need more clearance.

Medina is now looking at keeping it in the DPW building in the short-term while the board mulls how to handle housing the truck long-term.

The payment for the truck is a new worry for the Village Board.  The federal government shutdown, now in its third week, could hold up financing for the new truck. Medina in June 2023 agreed to pay Pierce Manufacturing $1.7 million for the ladder truck.

The U.S. Department of Agriculture approved financing at a 4 percent interest rate for a loan for the truck. The USDA payment would be made when the truck is delivered.

However, the village would need a functioning federal government to access and get approval for the money to be paid to Pierce.

“We’re depending on the federal government to be open because that is who our loan is through,” Mayor Marguerite Sherman said during this evening’s Village Board meeting.

Village Clerk-Treasurer Jada Burgess told the Village Board that the Medina’s financial consultant advised the village to begin the process of seeking a loan from a private bank for the truck. The village could put the financing out to bid to see what lenders would be willing to charge Medina with an annual interest rate. Right now, that rate is unknown, Burgess said.

Switching to a private lender could be a $15,000 to $20,000 charge by hiring a bond counsel, and that doesn’t include interest rates that are expected to be higher than the 4 percent from USDA, she said.

Medina could initially use a loan from a bank and then pay off that loan with the one from the USDA if the federal loan can’t be accessed on time. But the village would still incur some expenses for bond counsel and the initial elevated payment(s) if the loan is at a higher rate than what is offered by USDA.

The slight delay on the truck’s delivery gives the Village Board more time to consider the matter, especially if the federal government shutdown continues. Burgess said it could be a six-week process to access the loan once the government reopens.

Board members said there is still more time for the shutdown to end and the government to have the funding in place before Medina would have to pursue alternative financing.