1st Summit Bank’s main branch in Richland has provided the city of Johnstown a $1 million general obligation note.
City Council finalized the agreement with a resolution earlier this week.
Originally, in October, the city planned to apply for an open-ended line of credit. However, the state Department of Community & Economic Development required Johnstown to arrange a financial agreement with a closing date for the loan.
The arrangement with 1st Summit will last for two years.
“It’s now more of a general obligation note versus a line of credit, based on the fact that DCED doesn’t really allow for lines of credit that have an open end,” said city finance director Carlos Gunby.
“We had to kind of put more of a closing to the end of the loan, but it’s still a line of credit because once we close it we can reopen it immediately. There are terms and semantics with the DCED to get the line finalized.”
Gunby solicited proposals from all area banks.
“1st Summit came in with the terms and interest that we were looking at,” Gunby said.
Johnstown will use about $350,000 to $375,000 toward retrofitting Lincoln Center, Main Street East and Intermodal Transportation Center garages with light-emitting diodes to replace the current ballast lights. Thanks to energy savings, the city expects to recoup the costs in about three years.
“It will pay for itself almost instantaneously,” Gunby said.
Some of the other money will be used to purchase police cruisers and public works vehicles.
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