The day that Hewlett-Packard breaks ground in Rio Rancho is getting closer according to Rio Rancho Mayor Tom Swisstack.

He said he anticipates the city finalizing its contract with Hewlett-Packard by next week and the construction being complete in 19 months.

The mayor also said the city is working on getting zoning and public works in place so water and sewer will be available. The City Council helped in the process on Wednesday by unanimously approving a resolution that gives the city’s finance director, Dick Kristof, the authority to apply to the New Mexico Finance Authority to issue $5.2 million in bonds. The funds will be used to construct a road, water and wastewater infrastructure for the HP project.

The bond’s duration is 20 years. Gross receipts taxes will be used to repay the bond and interest. Kristof explained that the interest rate was 4.37 percent but because of the recent turmoil in the market, the interest rate is unknown. He did say that Los Alamos recently issued a $75 million bond with an interest rate of 5.4 percent.

The total cost for the Rio Rancho project is $5.1 million. Issuance cost of the bond is $120,000, the processing fee is $80,000 and financial advisor and bond attorney fees are estimated at $40,000. Kristof anticipates starting the project in November.

Because the city has a strong bond rating of AA, no debt service reserve is required.

RBC Capital Markets is the financial advisor and Modrall Law Firm is the bond counsel.

Gov. Bill Richardson, announced in June, that he will ask the state Legislature for $12 million in capital outlay funding to help pay for the infrastructure. The state Legislature must approve the money next year.

The state is offering HP the Job Training Incentive Program, which reimburses qualified economic-based companies for a significant portion of training costs associated with job creation. It provides for classroom or on-the-job training, reimbursing an expanding or relocating business for 50 to 80 percent of a trainee’s wages for as long as six months.

Hewlett-Packard chose Rio Rancho and Conway, Ark., in June, as locations for new state-of-the-art customer service and technical support centers. The Palo Alto, California-based company plans to open the center in Rio Rancho next year and bring more than 1,300 jobs to the area over the next four years. The average salary is $50,000 to $60,000.

Hewlett-Packard will be located in the central business district off King Boulevard. With the city center area adding another business it is just a matter of time before retail outlets call the area home. Swisstack said that restaurants and hotels have contacted him expressing interest in building downtown.

The area is getting University of New Mexico and Central Community College branches, and already has the Santa Ana Star Center and City Hall.

The jobs created by Hewlett-Packard will be the coveted economic base jobs. Presently, Rio Rancho has 15,000 economic base jobs and there are 63 economic based companies in Sandoval County.

A job earns the economic base label if the majority of the company’s products or services are exported from the community.