Construction started earlier this year on a 1.77-mile Albert Gallatin/Hatten Track road extension project that will go from Dobbins Pike to S.R. 109.

As Gallatin waits for millions of dollars in reimbursement payments from the State of Tennessee for expenses related to construction of the city’s northern bypass, local officials are taking steps to prevent the project from putting a financial strain on the city’s finances.

The Gallatin City Council unanimously approved a resolution on Sept. 3 authorizing the issuance of a grant anticipation note not to exceed $12 million that would be used to pay for the state’s portion of the Albert Gallatin/Hatten Track road extension project.

A grant anticipation note is structured similar to a personal construction loan or a line of credit, which would allow the city to borrow any amount of money as needed, according to Rachel Nichols, Gallatin. However, the city would be responsible for paying the 3.48 percent interest rate on whatever amount was borrowed.

“Our cash is getting lower and lower and lower and lower,” Nichols told city leaders during a committee meeting last month. “We’ve paid out all of this money, but (the state hasn’t) reimbursed anything yet for the past four months.

“I don’t know how long it’s going to be before they start.”

Gallatin is still waiting to receive $3 million in reimbursements from the state, according to data from the city’s finance department. The last reimbursement was received June 19. The city has not billed the state for an additional $772,000 in expenses through the end of August.

As part of the process, the city pays each bill associated with the state project up front, according to Nichols. The city then gets copies of the cancelled checks from the bank and submits a request to the state for reimbursement. The entire state approval process takes approximately 60 days “at best.”

Nichols added that if the reimbursement process was not delayed, the city would be in “good shape.”

“I don’t think that it’s right that we pay interest when the state is just not doing their part,” District 1 Councilwoman Lynda Bradley Love said during a committee meeting Aug. 27. “I don’t know what else to do about it.”

Construction of what will act as Gallatin’s northern bypass started in January and is expected to be completed in the summer of 2021.

The 1.77-mile project will extend Albert Gallatin Avenue west from Dobbins Pike to a new interchange at State Route 109 between Old Highway 109 North and Red River Road. A new bridge over East Camp Creek and a widened bridge over the CSX railroad will also be added along with a signalized intersection at Blythe Avenue.

The cost to build the road is $27.4 million with the entire project expected to total approximately $36 million once complete, according to city officials.

“This is the largest privately managed project that has ever been done for the state, so… I don’t think other cities anywhere are probably fronting this kind of money,” Mayor Paige Brown told city leaders last month. “I don’t think anybody thought about how it would financially trickle out. This is the first experience.”

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