By Travis Gettys
Enquirer contributor

NEWPORT - City commissioners rejected a measure 3-2 Monday to let a developer stretch out payments on $1.7 million in cost overruns for Newport on the Levee.

The plan would have allowed Columbus developer Steiner and Associates to make payments to the city over 10 years at an interest rate of 3.3 percent, rather than all at once.

The debt would at some point be rolled into a bond, said City Manager Phil Ciafardini, but the developer's interest rate would not exceed 6 percent.

Some commissioners expressed concern that the city would be responsible for the debt if the developer defaulted on the loan.

"I'm not comfortable taking on any more risks and liability," said City Commissioner Beth Fennell, who voted against the measure with Robbie Hall and Jerry Peluso.

Newport received a $5 million Kentucky Transportation Cabinet grant for the project, and the original agreement called for the developer to pay anything over that. .

Steiner and Associates budgeted only $500,000 to cover cost overruns, and they asked city officials if payments could be spread out, said Greg Engelman, Newport chief financial officer.

Property acquisition related to widening Ky. 8 between York and Saratoga streets pushed up the project's cost, Ciafardini said.

The issue will likely be brought up again at the June 21 commission meeting, Ciafardini said, after he meets with developers to discuss possible changes to the plan.

"Newport on the Levee is a great project, of course," Fennell said. "Hopefully there's another way to get this done."