Panama City’s Hurricane Michael Expenses Surpass $50M

March 25-- Mar. 25--PANAMA CITY -- Having spent more than $50 million on Hurricane Michael recovery, Panama City Commissioners are expected to take out a much-discussed second loan on Tuesday.

As of Friday, March 22, the city has paid out $51,127,803.44 in recovery costs, mostly debris cleanup, exceeding the $50 million loan the city took out in December. At the Panama City Commission meeting on Tuesday, the commission will vote on taking out a previously discussed $25 million loan.

Even in December, Mayor Greg Brudnicki warned "don't be surprised if we have to go back to the well again." In late February, the commission laid the groundwork for the additional $25 million, as they saw the costs quickly rising.

The hope is this $25 million "will provide adequate cash flow until related reimbursements from FEMA and other grants are received," city documents said. The city's share of the cost is currently 12.5 percent, though there is hope that it will eventually be lowered to 5 percent via a new decree by President Donald Trump. If that happens, volunteer hours that can be counted toward the city's cost share are on track to cover a large portion of, or possibly the entire, bill, according to City Manager Mark McQueen.

The city had about $12 million in reserves pre-storm. The city has received a little over $1.82 milion in FEMA reimbursements as both FEMA and the state work to expedite the reimbursement process. But even with the checks starting to come in, the time frame of when they arrive remains uncertain, officials say, and bills need to be paid in a timely manner.

Interest will likely have to paid on the loan while reimbursements are worked through, an expense city officials have estimated at $1.2 million a year that is not reimbursable by the federal government.

After a bid process, the commission is considering using PNC bank for the second loan, the same one that was used for the first note. The city is not the only municipality that has taken out a loan to cover upfront hurricane costs.

Also on the agenda is a resolution asking Congress to pass a tax relief bill, a change order of $1.4 million to build an environmental lab at the St. Andrews Waste Water Treatment Facility, and a discussion about the city's 4th of July celebration this year. The commission meeting is March 26, at 8 a.m. at the County Government Center.

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