The Stuart City Council approved entering into a taxable general obligation cash flow loan agreement Monday.

A public hearing for the resolution lasted around 30 minutes as the Council and other attendees including City Administrator Ashraf Ashour, Financial Advisor Chip Schultz and Police Chief Dave Reha explained how the loan not exceeding $400,000 would be used. Council member Bryan Belden explained that part of the agreement can be used for a $200,000 budget shortfall the City is facing caused by COVID-19, “Regarding the purpose of this note, it is not just exclusive to policing and rescue, this gives Ash the flexibility to cover shortfalls that’s caused by COVID.”

Schultz mentioned that this kind of loan agreement is an uncommon financing mechanism that’s now commonly being used by different cities in response to the current pandemic. The Council also approved a motion to add $40,000 from the City’s valuation as of the next fiscal year to the general fund.