Carmi City Council mulls water rate increase
Carmi City Council met Tuesday, Aug. 16.
Here are the minutes as provided by Carmi:
Minutes: City Council Meeting of Aug. 16, 2016
The Carmi City Council met Tuesday, August 16th, 2016 at 5:30 p.m. in the Council Room of the Municipal Building, 225 East Main Street.
Prior to opening the council meeting, Mayor Pollard asked Alderman Winkleman to give the invocation. The prayer was followed by the Pledge of Allegiance.
Mayor Pollard presided with the following Aldermen present: Steve Winkleman, Mark W. Blake, Keith Davis, Sheila Jo Headlee, Jack Lamont, Doug Hays and Mike Knight. Alderman Lance Yearby was absent due to work.
Minutes for the August 2nd, 2016 council meeting were presented. Motion made by Alderman Lamont and seconded by Alderman Blake to approve the minutes as presented. The motion carried on roll call by each Alderman answering “yes.”
July 2016 Financial Reports were presented. Motion made by Alderman Headlee and seconded by Alderman Winkleman to approve the Financial Reports as presented. The motion carried on roll call by each Alderman answering “yes.”
August 2016 Vendor Invoices were presented. Motion made by Alderman Winkleman and seconded by Alderman Knight to approve the Vendor Invoices as presented. The motion carried on roll call by each Alderman answering “yes.”
Mayor Pollard presented Keith Botsch, City CPA and Auditor for the City of Carmi to present the 2015 Annual Audit, Financial Report for the fiscal year ending 12-31-2015. Mr. Botsch started with the 2015 annual audit. He stated that the city’s revenue was five million three hundred and ninety-four thousand dollars ($5,394,000) and they had a deficit of seventy-eight thousand dollars ($78,000). He then commented that revenues are down. He stated that the city had seven hundred and thirty-nine thousand dollars ($739,000) in assets. The library fund had one hundred and ninety-seven thousand dollars ($197,000), the TIF fund had two hundred and ten thousand dollars ($210,000), Economic Development had one hundred and twenty thousand dollars ($120,000), and Motor Fuel Tax had three hundred and seventy-two thousand dollars ($372,000). He added that the library fund had a deficit of eighteen thousand one hundred and forty-nine dollars ($18,149) before money that got transferred in from the city. After that there was a deficit of six hundred and forty-nine dollars ($649). He explained that they projected five million dollars ($5,000,000) but the actual budget was three million dollars ($3,000,000) and added that it is compared in more detail on pages 65 of the audit. Page 70 was for the library and page 73 was for the Enterprise fund (Light and Water). Alderman Headlee asked if AquaLine is in the water revenue. Mr. Botsch stated that it is under the Water Department under one million three hundred and sixty-eight thousand dollars and twelve dollars ($1,368,012) charges for service. The total utilities are at a forty-five thousand dollars ($45,000) deficit. Mr. Botsch stated that the city needs to raise water rates. Frank Elliot stated that the city is at a thirty-five percent (35%) water loss and that translates to ten (10) million gallons a month. Alderman Headlee asked about the police pension fund figures and Mr. Botsch stated that he has not heard anything back yet but he thinks it will go up.
Mayor Pollard then presented Keith Moran with Moran Economic Development to discuss the proposed Tax Increment Financing (TIF) districts. Mr. Moran first talked about Inducement Resolution No. 08-16-16.1. This is the ability to re-pay the city out of the Tax Increment Financing (TIF) fund. Motion made by Alderman Winkleman and seconded by Alderman Headlee to approve the Inducement Resolution as presented. The motion carried on roll call by each Alderman answering “yes.”
Mr. Moran then explained Feasibility Resolution 08-16-16.2. This is a requirement of the Illinois Tax Increment Financing (TIF) act. It informs the taxing districts that an area is being reviewed for purposes of establishing Tax Increment Financing (TIF) district #2. Motion made by Alderman Hays and seconded by Alderman Knight to approve the Feasibility Resolution as presented. The motion carried on roll call by each Alderman answering “yes.”
Mr. Moran asked the council to consider Ordinance No. 1506 an Ordinance of the City of Carmi, Illinois authorizing the Establishment of Tax Increment Financing “Interested Parties” Registries and Adopting Registration Rules for these Registries. This means that anybody who is interested in Tax Increment Financing (TIF) district #2 can receive the necessary paperwork. Motion made by Alderman Winkleman and seconded by Alderman Lamont to approve the Ordinance as presented. The motion carried on roll call by each Alderman answering “yes.”
Mr. Moran then presented the Feasibility/Eligibility Study by Moran Economic Development. He explained that the Tax Increment Financing (TIF) district will be East Main Street to the fairgrounds. They are sticking with corporate boundaries and addressing vacant buildings. This could also help with the flood buy-out properties. There are six hundred and seventy-seven (677) parcels. One of the things that they look for are buildings over the age of thirty-five (35). Twenty-seven percent (27%) of parcels are in Tax Increment Financing (TIF) district #1. He stated that four hundred and eighty-five structures show deterioration and seventy-one percent (71%) of parcels show deterioration signs as well. Tax Increment Financing (TIF) district #2 can address these infrastructure issues. The new Tax Increment Financing (TIF) district is not growing comparable to the other parts of the city. He then asked for a motion to proceed with the Tax Increment Financing (TIF) Plan. Motion made by Alderman Davis and seconded by Alderman Winkleman to proceed with the Tax Increment Financing (TIF) Plan as presented. The motion carried on roll call by each Alderman answering “yes.”
Mr. Moran next presented the Tax Increment financing (TIF) Plan by Moran Economic Development. He explained that the new Tax Increment Financing (TIF) District is all about business recruitment and retention. He discussed the possibility of a facade improvement program. It will also help with assisting taxing districts for school districts. He stated that the next steps would be to mail out to the residents about the Tax Increment District (TIF) District #2 Plan. He stated that the council will be asked to pass Ordinance No. 1507 at the next council meeting to set up a public hearing date. Alderman Winkleman asked if funds from Tax Increment Financing (TIF) #1 and #2 can be intermingled. Mr. Moran stated that yes it could be. Motion made by Alderman Headlee and seconded by Alderman Blake to place the Tax Increment Financing (TIF) Plan and Feasibility Study on file (10 days) and to approve sending the Tax Increment Financing (TIF) Plan and Feasibility Study to all affected taxing districts. The motion carried on roll call by each Alderman answering “yes”
Mayor Pollard then asked the council to consider the review of water rates for potential increase for the City of Carmi Light and Water customers. He stated that he touched on this issue at the last council meeting. When they bill right now, they bill to the 1,000th of a gallon instead of the 10th of a gallon. He then broke down of what percent to charge for water rates. Mayor Pollard’s own bill would raise $1.59 if they billed to the 10th of a gallon. That would average out to fifty-seven thousand dollars ($57,000) a year. He added that the Ordinance has to be amended to even change the billing scale. He then brought up a pump fee charge and suggested that it be a flat rate. The $3.75 a month for AquaLine is already a fixed cost on the customer’s water bill. There have been thirty-five (35) claims to AquaLine since it was put into effect and the contract with AquaLine is up. Alderman Knight asked how effective the budget program is. Mayor Pollard stated that it is very effective and that it has reduced shut-offs. City Clerk Brian Allen stated that there is a Carmi City Utility tax of 5% added to the water rate charges according to the current ordinance. John Acree explained billing to the 10th of a gallon would create more income for Carmi Light & Water. The council census is to bill to the 10th of a gallon. Mr. Acree stated that there are two (2) issues; the water department is losing money and the city now has a one point three million dollar ($1,300,000) EPA loan in the works. The council census is to amend Ordinance No. 1425 to bill to the 10th of a gallon, to keep the five percent (5%) city water tax, increase water rates by two percent (2%) for a total water rate increase of seven percent (7%) and to do a four dollar ($4) flat meter charge for twenty (20) years. Alderman Headlee stated that they have tightened the city’s budget and they are still in the red, so now they have to pass it on to the consumer.
Mayor Pollard then presented Dan Kearns with Coston Engineering to present the 12 MV Solomon Transformer purchase. Mr. Kearns stated that the council has four (4) options with the first being to immediately purchase the transformer from Marshall, IL for twenty-five thousand dollars ($25,000) with no repairs done to it at all. The second option is to buy the transformer from Marshall, IL and then have Solomon Transformer to repair it for one hundred thirty-four thousand, seven hundred and twenty dollars ($134,720). Alderman Hays stated that the transformer from Marshall, IL is plugged with nitrogen and it does not have any oil in it, which is not feasible for the long run and that option one is not a good option due to the repairs that it will need. Option three (3) is to buy the transformer and pay Solomon Transformer twenty-five thousand dollars ($25,000) immediately and pay a monthly sum of three thousand three hundred and seventy-five dollars ($3,375) for thirty-six (36) months. Option four (4) is that Duke Energy One would make an addendum to the city’s current contract, and payment would begin in March 2017. They would buy it and repair it and the city would pay Duke back as quickly as they can. Mr. Kearns stated that option three (3) is the best option of one hundred seventy-one thousand five hundred dollars ($171,500) over two (2) years. He added that Solomon Transformer is asking for a decision immediately. Alderman Hays stated that nobody really knows when the current transformer will fail being as it is so old. He added that he thinks option four (4) is feasible and he wants to pay the transformer off early and not go the complete term of ten (10) years. There is a three percent (3%) difference in interest, which is not that big of a deal. Mayor Pollard stated that there should be more cash flow available from the Light Plant budget next year. Alderman Hays commented that the transformer weights ninety-two thousand pounds (92,000 lbs.). Alderman Davis commented that he does not want to pay the ten percent (10%) interest and wants to pay it off early. He would like to see it paid off in three to five (3-5) years. Alderman Winkleman asked if the city has ever had a backup transformer before. Several aldermen stated “No” the city has never had a backup transformer. They explained that it would back up the main transformer at Bradshaw Park substation. If it fails, the Light Plant could not generate enough power and it would cost a lot of money to run the Light Plant to power the entire city. Motion made by Alderman Hays and seconded by Alderman Davis to go with Option four (4) and Duke Energy as presented. The motion carried on roll call by each alderman answering “yes.” Alderman Winkleman voted “no.”
Reports and/or updates from Mayor Pollard
Mayor Pollard wanted to give a special thank you to Mike Knight and his crew for doing some extra clean up at the airport. He commented that it looks great.
He stated that there was a glitch in the email at the office this week. Everything should be corrected now and the email address should be back to.com instead of.org. He wanted to apologize for the inconvenience.
Mayor Pollard stated that a showing of the Monsters Inc. movie will be added to all of the original events at Burrell’s Woods for the Halloween celebration weekend. It will be shown in the campground on Friday October 21st at 7:00 p.m. The public is welcome to attend. He also wanted to remind everyone about the lottery process for camping that weekend. Call (618)-382-7606 or email the Chamber office at firstname.lastname@example.org to be entered into the lottery. The Halloween event has turned out to be a big event and that is why they have gone with the lottery option for reservations so that it can be fair for everyone. We ask for your name, address, phone number, and camper length. Obviously, the name, address, and phone number is so that you can be contacted to confirm your request to be entered into the lottery and to inform you if you won the campsite. The camper length is to insure that you are placed in the proper campsite.
Reports from Standing Committees
Alderman Hays brought up GPS tracking for city vehicles. He found two (2) options. GoTrack is upfront cost of four hundred dollars ($400) a vehicle and is a two (2) year contract. Workwave is $24.99 a month with no costs up front other than a twenty dollar ($20) activation fee. He added that GoTrack is cheaper in the long run than Workwave. Alderman Headlee stated that AT&T would not work for the county. Alderman Hays stated that this is a way to manage expenses.
Alderman Lamont questioned if the city has ever got in contact with the railroad company yet. City Supervisor Mike Buckman stated that there is a meeting tomorrow with them. He stated that Stewart Street just keeps sinking and getting rougher.
Alderman Winkleman stated that the trees at the Railroad crossing is East Carmi need to be trimmed because it is dangerous.
Business or Comments from Visitors
Motion was made by Alderman Headlee and seconded by Alderman Davis to adjourn. The motion carried on roll call by each Alderman answering “yes.”
At 7:45 p.m. the council adjourned.
Brian K. Allen, City Clerk
Jeff Pollard, Mayor