The Collinsville Area Recreation District passed a resolution Tuesday making formal a request for the City of Collinsville to give land to the district.

Through a series of renewable agreements, CARD leases the Jaycee Sports Complex, Glidden Park, Morris Hills Park and Woodland Park from the City of Collinsville. CARD representatives – and at least one private resident – have previously spoken to City Manager Scott Williams about the City giving the land to the district.

Until a formal request was made, the matter could not be considered by the City Council. Williams said he has not yet seen the resolution, so he cannot comment. He will, however, present it to the Council.

CARD does not pay the City for the property it leases, but must maintain it. Capital improvements are also the responsibility of CARD.

The resolution states that CARD’s policy of only adding capital improvements to district-owned parks is in the best financial interest of residents. CARD Executive Director Susan Zaber said there is currently no policy restricting capital improvements to district-owned land, but a policy is in progress. CARD has the option to lease the land from the City with no lease payments until 2087.

In theory, CARD could pay for the transfer of land, Zaber said, but realistically the district does not have enough money to purchase land. At the Tuesday meeting, Commissioner Mark Achenbach stated multiple times that the district may have to consider borrowing more in its annual rollover bond than is needed to repay debt.

Careful to stress that he was not advocating borrowing more money, which would raise taxes of those in the district, Achenbach said the option may have to be considered in order to build minimum balances in funds. Achenbach said borrowing the additional money would not be used to spend on operations, but to build fund balances.

CARD Board President Patrick Collins said the transfer of land would improve the district’s financial position.

“It will put assets into our bottom line,” Collins said. “We don’t have enough assets to cover our current debt.”

An increase in assets would translate to better rates on bonds if the district decides to issue bonds in the future to raise money, Collins said. CARD’s Bond Counsel said the increased assets do not have a direct impact on the rates of the annual rollover bond the district issues to pay debt, but may, because more banks would be encouraged to bid, Collins said.

Collins said the benefit to the City of Collinsville would be to the residents, who would have lower taxes. The decrease in taxes would be the result of lower interest rates if CARD issued bonds to raise additional funds.

The resolution states that the City of Collinsville does not carry the value of the leased parks on its most recent financial statements. City Finance Director Tamara Ammann said that was true in the past, but not for some time. When the issue was brought to her last year, she corrected it.

“The land was added to the City’s balance sheet as a prior-period adjustment in the Dec. 31, 2013 financial statements,” Ammann said.

The leased land is currently valued at $1,834,508 by the City, Ammann said. The exact value to CARD cannot be estimated, Collins said, because negotiations have not begun for which parts of the leased land would be given as a gift to CARD. The resolution also asks for the transfer of some land adjacent to the leased property.

The resolution cites the transfer of Collinsville Library land, including the Blum House, to the library district as a precedent for the City transferring ownership for no cost. The Mississippi Valley Library District was created in 2004 and, as part of the agreement, existing library land was transferred to the district.

In March 2013, the City Council voted to forgive CARD debt in the amount of $235,000 after CARD chose to return the Miner’s Theatre to the Miner’s Institute Foundation. According to the rules and regulations of Tax Increment Finance fund disbursement in the City of Collinsville, a property owner must retain a property for four years after the completion of a TIF project. The debt, however, was forgiven.