INTRODUCTORY
The City Council of the City
of Columbia, Missouri met for a special session at 5:35 p.m., on Thursday,
January 16, 1997, in the Council Chamber of the City of Columbia, Missouri. The
roll was taken with the following results: Council members KRUSE, HINDMAN,
COBLE, JANKU, CROCKETT, and CAMPBELL were present. Member HARLINE was
absent. The City Manager, City Counselor, and City Clerk were also
present.
OLD BUSINESS
B13-97 Proposing
an amendment to the Home Rule Charter to make language gender neutral, and
calling
a special election on the amendment.
The bill was given second
reading by the Clerk.
Mr. Beck explained that the
Council asked that this ordinance be prepared at this time so that a special
election would not have to be held to deal with the proposed amendments.
Ms. Coble noted that this
amendment would identify members of the Council as Council members and would
not change the substance of any of the provisions of the Charter. She
said they were not getting into any other language other than people's positions
-- changing masculine pronouns to the title of their job.
Mr. Campbell said this change
was long overdue and was glad to see that Council member Coble had taken
a lead in the issue. He thought it would be widely supported by the
public.
Mrs. Crockett noted that
she received several calls regarding the cost of this. She asked Mr.
Boeckmann if she understood correctly that the only cost incurred would be
the cost of printing the ballot. Mr. Boeckmann said there would be
an extra charge for the printing of the ballot and also for publication because
it has to be published in the newspapers of general circulation two times
before the election. He said there would be a slight extra cost for
that, but the bulk of the cost for elections was for the City's share of
the election judges and so forth. This was a cost that would be incurred
anyway. Mrs. Crockett commented that by proposing the amendment for
voter approval now, it would be done at a time when it would be most feasible
for the City. Mr. Boeckmann said that was correct.
Mayor Hindman opened the
public hearing.
There being no comments,
Mayor Hindman closed the public hearing. B13-97 was given third
reading with the vote recorded as follows: VOTING YES: KRUSE,
HINDMAN, COBLE, JANKU, CROCKETT, CAMPBELL. VOTING NO: NO ONE. ABSENT: HARLINE. Bill
declared enacted, reading as follows:
B14-97 Calling
the municipal election to be held April 1, 1997, to elect Councilmen
for Wards 2
and
6.
The bill was given second
reading by the Clerk.
Mr. Beck noted that this
had been prepared in accordance with the City Charter.
Mayor Hindman opened the
public hearing.
There being no comments,
Mayor Hindman closed the public hearing.
B14-97 was given third reading
with the vote recorded as follows: VOTING YES: KRUSE, HINDMAN,
COBLE, JANKU, CROCKETT, CAMPBELL. VOTING NO: NO ONE. ABSENT: HARLINE. Bill
declared enacted, reading as follows:
B19-97 Calling
for an election for the Water & Light Revenue Bond Issue.
The bill was given second
reading by the Clerk.
Mr. Beck explained that the
Council had several reports and two work sessions to discuss the need for
this bond issue, what the rate impacts would be, and the project list. Revisions
were made that have been presented to the Council this evening in accordance
with Council guidance following the work sessions. The City's special
bond counsel, working with staff, prepared the necessary paper work for this
particular ballot issue. Mr. Beck noted that this is a revenue bond
issue and would have no impact on the City's property tax. He said
it would be paid off from rates and added that the list of projects was consistent
with the City's long range financing strategy. The list was considered
to be basic to the City's needs. Mr. Beck called on David Wollersheim,
Chairman of the Water and Light Advisory Board, to make a few comments.
David Wollersheim, 2801 W.
Broadway, wanted the Council to know that the Water and Light Advisory Board
endorsed and strongly supported the bond issue. He said the Board continuously
monitored the Water and Light budget, especially the capital improvement
plan, year by year. This bond issue was certainly consistent with their
funding strategy. At one time, the Board planned on having a bond issue
of this sort every five years, but there has not been one since 1982. It
has almost been that long since the last electric utility rate increase. Mr.
Wollersheim said we had been very fortunate in terms of the rate of growth
and power supply in the City, and have been able to generate enough revenue
from utility rates to maintain the growth of the electric and water utility. He
noted that Tom Baumgardner, a member of the Advisory Board, was also present
and they would be glad to answer any questions.
Dick Malon, Director of the
Water and Light Department, gave a brief overview of the revenue bond projects
and financing strategy, similar to that recorded in the minutes of the last
regular meeting.
Mr. Beck emphasized there
would be no rate increase in electric service. He said the water rate
would increase two percent per year beginning October 1, 1997. Over
the five year projected period, the amount would be less than ten percent
as there would be only four increases.
Lori Fleming, Finance Director,
explained how the financing mechanism would work. She pointed out that
this bond proposal was consistent with what she considers the business plan
for the utility. The amount of the bond issue was sufficient to cover
capital needs for five years, and that the City would be funding those capital
needs with a combination of bond proceeds and monies generated from the operation
of the utility. As such, the City could anticipate that there will
be this type of bond issue every five years because that is what our business
plan calls for -- funding a portion of our capital projects with debt. She
said it is desirable to fund a portion of capital projects through debt because
that spreads the cost to those who will benefit as future customers on the
system. Ms. Fleming reported one might question if it is the City's
business plan to have a bond issue every five years, why we have been able
to go so long without a bond issue in the past. Ms. Fleming said the
City had been fortunate, but needed to consider the environment we were in
when the business plan was prepared that set the rates and the amount of
the bond issue. At that point in time, interest rates were almost at
an all time high so a set of projections were developed, a business plan. Projections
indicated interest rates were going to be high, fuel costs were going to
be high, and cost of power was going to be high. Because of that, the
rates were set accordingly. Through good management and planning, the
City was able to reduce costs and take advantage of lower interest rates
by refinancing and restructuring the debt so that there was an inflow of
almost $9 million into the capital cash. She said the money was not
spent as fast as had been anticipated. Ms. Fleming noted that the City
of Columbia enjoys an excellent bond rating - double A, with the highest
rating being a triple A. There was no anticipated impact on the bond
rating because of the additional debt that would be incurred. Ms. Fleming
reported they believed this bond issue would be well accepted in the financial
market and there would not be any adverse affect on the financial condition
of the utility with the issuance of the debt. It was felt the City
would continue to enjoy a good bond rating in the utility.
Mr. Campbell commented that
we have an excellent system in place and pointed out that this was not a
crisis, but simply maintenance of the excellence we have. He noted
that he had been on the Council for eight years and had never had any complaints
about the Water and Light Department services, only compliments. He
commended Mr. Beck and his staff, Mr. Malon, and the Water and Light Advisory
Board for a job well done in providing an excellent quality of service. Having
watched this for many years, Mr. Campbell said the City has had absolutely
no increases in electrical rates and the increases in water rates had not
begun to keep up with the cost of inflation. He said even though there
have been some small increases, the City was still well under the rate of
inflation so the cost of water to the consumer has actually been going down.
Mr. Janku pointed out that
the City's Water and Light utility operates as a business and is separate
from the general tax funds received from property tax and sales tax. Like
a private business, they have developed a capital improvement plan to implement
over the next five years. He explained that the City had the option
of issuing special obligation bonds, without voter approval, but the Council
had elected to submit these revenue bonds to voter approval because this
is the lowest cost strategy for funding the capital improvement plan. The
issuing of revenue bonds brings lower interest rates for the benefit of the
customers of the utility. Mr. Janku's point was that this approach
was consistent with what a private utility would be doing to finance its
capital improvement plan.
Mayor Hindman noted that
passage of this bond issue would allow the City to expand with the community
and to keep the plant up to date in every respect. He said it was a
capital expenditure in the true sense that the City is spending these monies
in order to generate the revenues that will pay back the bonds. Mayor
Hindman thanked the citizens who are serving on the Water and Light Advisory
Board. He said Board members do so unselfishly, they meet regularly
and tackle very difficult problems. The members are experts in financing
and in the world of utilities. He said the City was very fortunate
in that respect. Mayor Hindman reiterated that the only rate increase
proposed was two percent per year on water only -- nothing on electricity. According
to calculations, the two percent increase would be $.27 per month, per household. Over
the four year period, that would total $1.08 per household.
Mr. Janku pointed out that
the electricity issue deals solely with distribution, not with the power
supply. Recently, the Council authorized an agreement with Union Electric
guaranteeing the City's power supply into the year 2004. He said this
agreement would keep the rate stable.
Mr. Janku made the motion
that they amend B19-97 by adding the number "2" after the word "proposition",
both in the body of the ordinance and in Exhibit A to the ordinance. The
motion was seconded by Mr. Campbell and approved unanimously by voice vote.
Mayor Hindman opened the
public hearing.
There being no comments,
Mayor Hindman closed the public hearing.
B19-97, as amended, was given
third reading with the vote recorded as follows: VOTING YES: KRUSE,
HINDMAN, COBLE, JANKU, CROCKETT, CAMPBELL. VOTING NO: NO ONE. ABSENT: HARLINE. Bill
declared enacted, reading as follows:
There being no further business, Mayor Hindman adjourned the meeting at 6:20 p.m.
Respectfully submitted,
Penny
St. Romaine
City
Clerk
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