The Collinsville Area Recreation District board of commissioners is considering a change to its financial practices that will ensure that the district will be unable to borrow money for the next 20 years.

Commissioner Andrew Carruthers is proposing that the park district collect property taxes in order to pay off previously issued bonds. The district's long-standing policy has been to abate, or not levy the taxes, on those bonds so that the debt does not count towards the district's total debt, said Interim Director Rick Robbins.

"When those tax levies are extended rather than abated, all of the principal on the outstanding debt is then counted towards the district's debt limit," Robbins said. "That puts us in a very difficult situation."

"I think CARD needs to focus more on paying off its existing debt rather than worrying about borrowing money in the future," said commissioner Andrew Carruthers. "And frankly, the best way to ensure the taxpayers that CARD will not go further into debt is for it to exceed its debt limit."

Robbins said that if the park district exceeds its debt limit, state law would prevent the district from issuing or refinancing bonds, entering into lease or purchase agreements or extending credit.

The park district's debt limit, based on a percentage of the district's assessed property value, is $17.3 million. The bonds in question total more than $25 million and were issued in 2004 to build Splash City Water Park, in 2007 to purchase Arlington Greens Golf Course and in 2010 to develop Pleasant Ridge Park in Maryville.

Not all board members agree with plan. Board president Mary Ann Bitzer and vice president Spike Bryant oppose the move.

"This means we cannot sign another lease for a long period of time," said Bitzer, who has been on the board since the park district was created 25 years ago. "That means a lease for our copy machine, computers, golf carts — the ramification of this is humongous."

Bryant, who has been on the board for 10 years, agrees: "Extending the bond is not good for the district. I don't agree with Mr. Carruthers on his position."

Commission Joan Burke could not be reached for comment and commissioner David Tanzyus said he has not made a final decision on the bond levy.

Robbins said that if the levy is extended, it would not result in a property tax increase because the operational portion of the tax levy was reduced by 20 percent and that would offset the bond levy increase. He said abating levies on large bond issues is a financial practice used by park districts across the sate.

"That's how most park districts around the state pay off their debt, that is the preferred method," Robbins said.

However, Carruthers, who was elected to the board last April, said he does not believe it is a sound practice. Because taxes are not collected to make the bond payments, the district purchases short-term or "rollover" bonds to make payments on long-term debt. In December, the district issued $1.4 million in bonds issue to make payment on the 2004 bond issue. Carruthers said the $52,157 price tag for the rollover bond issue was too costly and he believes the district should start paying its bond debt off through property tax collection.

Tanzyus, who was also elected to the board in April, said he wants to look at other options on repaying the district's debt. He also said he was concerned that the district is not being honest with the taxpayers about its full debt.

"We really should only have $17 million in debt, the way they're doing it, it's up to $25 million. I don't like the smoke-and-mirrors thing," Tanzyus said.

The board was scheduled to consider the abatement at its Tuesday, Feb. 21 meeting. The deadline to notify the county is March 1.

Contact reporter Ramona C. Sanders at 618-344-0264, ext. 136

Collinsville Area Recreation District Levies: By the numbers

$3,517,955: 2011 tax levy request

$1,316,000: Portion levied for operations

$1,399,373: Portion levied for short-term rollover bond debt

$802,582: Portion that will be levied for long-term bond debt if approved by the board

Source: CARD Interim Director Rick Robbins