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Home My WebLink About1986-06-02 Council minutesr Informal Council Discussion May 27, 1986 Informal Council Discussion: May 27, 1986, at 6:40 p.m. in the Council Cham- bers at the Civic Center. Mayor Bill Ambrisco presiding. Council Present: Ambrisco, Strait, Baker, Dickson, Courtney, McDonald. Absent: Zuber. Staff Present: Vitosh, Melling, Timmins, Karr, Smith, Schmadeke, Donner, Brinton. Tape-recorded: Reel 86-C48, Side 1, 366 -End, Side 2, 1 -End, Reel 86-050, Side 1, 1 -End, Side 2, 1-89. WATER/SEWER RATES Reel 86-C-48, Side 1 Vitosh stated Council received the May 1986 water and sewer system report which included reports on proposed rate increases and financing for wastewater treat- ment facility project. PROPOSED WATER RATE INCREASE. Vitosh explained the water rate increases are proposed over a three year basis and would be sufficient to cover operating costs, debt service costs for the east side water storage tank and the water plant computer system. Council reviewed the bar chart comparison for the water user rates with 16 other communities in Iowa. Brinton stated rates have been kept low because staffing levels and payroll costs have been kept to a minimum. Ambrisco stated the public should be informed about the benefits to Iowa City from running such an efficient system. PROPOSED SEWER RATE INCREASES. Vitosh reviewed the proposed sewer rate in- creases and said rates will be raised to a level to provide sufficent revenue to cover the annual debt service amount on the bonds the City will be issuing for the proposed wastewater treatment project. Vitosh explained the debt service program for the wastewater treatment project will be a level annual debt service amount so that debt service costs will be spread out equally over the next 25 years. Council reviewed the reports average household cost chart (page 9). In response to Baker, Vitosh said a total water/sewer/refuse bill at the end of the three year period (based upon 2000 cubic foot consumption for a two month period) will be $61.89. McDonald asked if Iowa City would still be eligible for future federal grants if the proposed project is 100% locally funded. Ken Haynie, bond counsel, said the proposed financing for the wastewater treatment project does disqualify the City from receiving federal grant monies. Haynie explained the Clean Water Act does require that communities are obligated to meet federal requirements by July 1, 1988; the EPA and State Department of Air, Water and Waste Management are in the process of requiring each plant operator to submit a plan for clean water compliance; and many communities are in the same situation as Iowa City. Baker inquired about the impact on the bond market from communities having to finance major wastewater treatment facility projects. Haynie said the bond market will be affected and there are only a limited amount of facilities in J1__- d =14 r Informal Council Discussion May 27, 1986 Page 2 the state of Iowa that construction. Haynie stated materials swastewater the bondmarketis favorable ableat this setime nplant to sell the proposed 25 year bonds. FINANCING FOR WASTEWATER TREATMENT FACILITY PROJECT. Vitosh recommended sell- ing a singe issue o sewer revenue ons o finance the project and to sell the bonds competitively. In response to Baker, Vitosh said the alternative to sell a combination of Go bonds and revenue bonds was studied. Vitosh explained it would be disadvantageous to sell the GO bonds because there would only be a $300,000 savings over 25 years, a substantial amount of the City's debt capac- ity would be used, and the City's bond rating could be affected. Vitosh said the City would not fund the project entirely with GO bonds because of their 20 year maturity date and the City's entire debt capacity would be used. Wayne Burggraaff said Moody's rating committee considers how quickly debt is paid, the amount of outstanding debt, and the local economy - all of which are good in Iowa City. In response to Baker, Burggraaff said there is approximately one quarter percent difference in interest rates from Triple "A" versus Double "A" rated bonds. Burggraaff explained the City hopes to obtain a Single "A" bond rating for the new issuance by demonstrating that the rate increases over the next three years will increase the level of revenue to meet debt service re- quired on the bond issuance. There will be a coverage covenant, and enough proceeds will be provided to establish debt service and improvements reserves. In response to Courtney, Vitosh said she will provide him with information on the current interest rates and time remaining on the City's outstanding bonds. In response to Baker, Vitosh said a competitive sale is the better sale method beusewrit- ers thati iare most interestedt lows the citto.s Courtney ell the oconte dednds on ethateadneg negotiated saate to the le would be better. vitosh said a public hearing on the proposed water and sewer rate increases and first reading on the rate ordinance is scheduled on June 3, the second and third readings on the rate ordinance is June 17, and a presentation to Moody's June 6on . McDonald l onadwith the recnded holding the on Jfirst l7 and second rate ordinance readi Baker asked when the Council will discuss impact fees. Timmins said the legal department will present information in late June or mid-July. Haynie stated that under state law impact charges are not sewer revenues and, therefore, impact fees would not be available for the financing of the wastewater treat- ment facility project. Baker asked the legal department to research the case law and other communities' ordinances as it relates to impact fees. COUNCIL TIME Reel 86-050, Side 1. Strait stated the Ad Hoc Transportation Committee final report should be in Friday's Council packet. Courtney stated he was contacted by social service representatives regard- ing the status of plans to make the Civic Center handicapped accessible. Vitosroomshaccessiblestated htoChandicappeity has ndated persons. Itlis CityiPolicyins be held in that staff will r-a.� =1k. Informal Council Discussion May 27, 1986 Page 3 go to the lobby area to assist handicapped persons and the City has abided by the federal regulations requiring the City to make reasonable accommoda- tions for handicapped persons. 3. Karr noted that there may not be enough Councilmembers available for quorum at the June 29 meeting and requested Councilmembers to contact her regard- ing summer vacation schedules. CITIZEN INPUT Reel 86-050, Side 2 Kathy Johnson stated there are junk cars located on South Highway 218 (Russell's Salvage Yard); the proposed entrance to East/West Oriental Foods and apartments on Gilbert Street will be dangerous because it is located on a hill and curve; and the railroad crossing located at Gilbert and Benton Street is not level with the street. Timmins stated the Planning Department has taken aerial photos of the area to determine the exact location of junk cars and property owners will be approached. Courtney and Baker explained there will be two accesses, one on Gilbert Street and one from behind the property, to the East/West Oriental Foods and apartments. Helling said staff will check on the railroad crossing located on Gilbert and Benton Street. Meeting adjourned at 7:55 PM. 1'do� I _A _A r COMPLETE DESCRIPTION OF COUNCIL ACTIVITIES June 2, 1986 Iowa City Council, spec. mtg., 6/2/86, 6:45 p.m., at the Civic Center. Mayor Ambrisco presiding. Councilmembers present: Ambrisco, Baker, Courtney, Dickson, McDonald, Strait, Zuber. Absent: none. Staffinembers present: Melling, Karr, Timmins. Tape recorded on Tape 86-C49, Side 2, 145-290. Moved by McDonald, seconded by Courtney, that the ordinance amending Chapter 9.1 ("City Plaza") of the Code of Ordinances of the City of Iowa City, Iowa, by repealing Sections 9.1-2, 9.1-3, 9.1-7, 9.1-8 and 9.1-11 therein and substituting therefore new Sections 9.1-2, 9.1-3, 9.1-7, 9.1-8 and 9.1-11, be given second vote for passage. Bob Welsh, 2526 Mayfield, appeared. The Mayor declared the motion carried with the following division of roll call vote: Ayes: Baker, Courtney, Dickson, McDonald, Zuber. Nays: Strait, Ambrisco. Moved by McDonald, seconded by Zuber, that the ordinance amending Chapter 5 of the Code of Ordinances, City of Iowa City, Iowa, by amending Section 5-1 thereof to provide a definition of the term "outdoor service area," and by adding thereto new Sections 5-39 through 5-44 relating to the regulation of outdoor service areas, be given second vote for passage. Bob Welsh, 2526 Mayfield, appeared. The Mayor declared the motion carried with the following division of roll call vote: Ayes: Courtney, Dickson, McDonald, Zuber, Baker. Nays: Strait, Ambrisco. Moved by McDonald, seconded by Courtney, to adjourn to informal session, 6:55 p.m. The Mayor declared the motion carried. WILLIAM J. 1BR SCO, MAYOR MRKrA�Ltl.c�lnei �! N K. KARR, CI*MJ `I