New London ― The city this year will bond $2.47 million to pay for infrastructure, emergency service equipment and other capital improvements, including those related to a recent church steeple collapse.

The bonding is split into two portions ― $1.8 million for road, sidewalks and other infrastructure work, and $673,000 for fire, police and municipal computer equipment purchases.

The total bonding amount is approximately $500,000 less than in past years, Finance Director David McBride said on Wednesday, a reduction he attributed to “numerous reasons.”

“One is that the interest rate market has increased in the last year or so and, as a result, our borrowing power has decreased,” he said. “So, we needed to reduce our request to stay consistent with prior years’ debt service.”

McBride said the city can still draw on previous bond allotments approved for school renovation and community center construction projects.

The City Council, which approved the bonding requests on Feb. 5, modified the infrastructure portion of the proposal on Tuesday to include $250,000 for costs related to the Jan. 25 steeple collapse at the former First Congregational Church on Union Street.

The city on Friday placed a lien on the property until it’s reimbursed by the church owners, Engaging Heaven Ministries.

Public Works’ Director Brian Sear said the $1.8 million bond amount is slightly less than the $2 million or so allotted in past years for infrastructure-related work across the city.

Sear said the infrastructure money is historically portioned out for sidewalk and curbing replacement, road milling and paving and individual “spot” repairs.

“The balance of that money has been used in past years for things like parking lot creation and building work,” Sear said. “For instance, we used some a few years ago to upgrade police cells.”

This year, some of the $1.8 million will be used to pay for a road re-configuration project on Governor Winthrop Boulevard required as part of a Garde Arts Center loading dock project.

In the runup to this month’s ordinance approvals, department heads created a “wish list” of proposed bonding projects that totaled $7.4 million, McBride said.

He said some of the requests not included in the bonding packages, including those for several new police vehicles and park improvements, will likely be addressed with the city’s remaining pool of American Rescue Act Plan funding.

In 2020 and 2021, the city received a total of $26.2 million in ARPA funding. McBride said the roughly $1 million in federal funding still not allotted by the city must be earmarked for use by the end of the year.

McBride said the infrastructure bond will be financed over 20 years at an estimated 3.65% interest rate. The interest rate for the vehicle and equipment bonding is tentatively pegged at 5% for five years.

The city’s bond rating was upgraded from A+ in 2022 to AA- by both Standard & Poor and Fitch credit rating agencies.

j.penney@theday.com