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Democracy on the Front Lines
City Administrators Blog
Walter Denton
May 21, 2009
Here is a summary of Monday’s City Council meeting agenda items. The items are listed in the order as they appeared in the agenda. Click here to see the full texts of the resolutions, ordinances, and staff reports. As a reminder, resolutions, motions, and special event permits only need to be approved once to become official. Ordinances are required to be approved in two readings (over two meetings) before they become official.
Here are the items that were approved by the City Council:
Resolution to lease/purchase equipment and vehicles: This is an annual resolution authorizing the City to secure/continue lease purchase agreements with local banks for vehicles and equipment approved in the budget. We do this primarily with police vehicles for three-year leases and some special use vehicles/equipment.
Resolution for minor subdivision on St. Ellen Drive: The property is located on the south side of West Highway 50 and is currently occupied by a mobile home development. The minor subdivision will create two lots: Lot 1, a 0.33 acre tract to be occupied by the existing buildings, and Lot 2, a 3.84 acre tract to be occupied by the existing mobile homes.
Resolution authorizing condemnation proceedings for Old Collinsville Road reconstruction project: The City has been approved for a state grant to reconstruct Old Collinsville Road from the Frontage Road to Milburn School Road. Part of the project requires the acquisition of some right-of-way and construction easements. There are several property owners holding out on the Old Collinsville Road project for questionable amounts, beyond dollar amounts that IDOT may wish to certify as reasonable. Since the project is programmed for this year, there is a danger of losing the funds. To extend the funding to next year, the state requires that the project begin undergoing a condemnation process for the remaining parcels needed for right-of-way or easements. This resolution begins that process. In the meantime, negotiation on the outstanding
parcels will continue and we are hopeful that all property can be acquired without condemnation.
Resolution to create an Identity Theft Protection Program: The Federal Communications Commission recently established new rules for any business or organization that collects personal information for sales or billing. Since we accept credit card payments for various City services and collect personal information, this resolution approves the standards implemented by the City to protect personal information.
Ordinance refinancing General Obligation Bonds (Second Reading): In 2006, the City issued $21 million in bonds to extend the Prop S Bonds and free up money for current projects, build a Conference Center, and build the First Phase of the Family Sports Park. Funding for this bond is part of the Prop S ½-cent Sales Tax, the Hotel/Motel Tax and the Food and Beverage Tax. With the increase of the City’s bond rating from AA- to AA, we are able to refinance these bonds from 20 years to 30 years, receive an additional $10 million to fund the next phase of the Family Sports Park and not increase our bond payment. The $10 million will build an additional four ball fields, two professional soccer fields and associated parking, concessions, playground equipment, trails, and rest rooms. The expansion will allow O’Fallon to be
competitive for Regional and National tournaments and establish the City as a destination to benefit our hotel and restaurant industry. With this ordinance, Bernardi Securities will go to market and establish demand, rate and cost. Bernardi will return for the second reading with financial details and a resolution authorizing the mayor to sign for the sale of the bonds and associated documents.
Ordinance issuing Library Bonds (Second Reading): When Vernon Ohlendorf passed away last year, he left $2.3 million in his estate for the O’Fallon Public Library. The Library would like to sell $2 million in bonds to expand the library. Mr. Ohlendorf’s funds will be invested and the proceeds used to pay off the bonds and if the economy recovers, by the end of 18 years the bonds will be paid and the Library will have the $2.3 million as an endowment. This issue is 2009A and shares the cost with issue 2009 to save cost of both issues. This is an enabling ordinance and does not contain details on the cost. With this ordinance Bernardi Securities will go to market and establish demand, rate and cost. Bernardi will return for the second reading with financial details and a resolution authorizing the mayor to sign for the sale
of the bonds and associated documents.
Ordinance amending the Telecommunications Tax (Second Reading): In 2006, the telecommunications was increased from 1% to 5% to raise funds to purchase the final 20 acres of ground for the Family Sports Park. When the increase was approved, an amendment was made for the increase to expire in 10 years. While the extra revenue purchased the park acreage, the sunset clause restricted and limited its use in overall financial ratings. If the sunset clause is removed, the telecommunications tax becomes part of the City’s long term revenue and, along with our overall good financial management, allows the City’s bond rating to increase from AA- to AA. The increased bond rating allows the City to refinance the 2006 bond issue from a 20-year bond to a 30-year bond and receive an extra $10 million to fund the next phase of the Family
Sports Park without an increase in the bond payment (see above). In addition, the inclusion of the telecommunications tax into the bond payments could also be used to offset part of the Prop S payment and free up an extra $1-$1.2 million per year for the term of the bond for infrastructure improvements (streets, stormwater, and sidewalks).
Ordinance increasing sewer rates (First Reading): While many City services are funded through tax revenue (such as property taxes and sales taxes), the Water and Sewer Funds are required by state law to operate as independent businesses. This means that all management, operations, and capital construction must be supported by user fees – namely, through the utility bills mailed to O’Fallon residents every month. The Sewer Enterprise Fund has not generated sufficient revenue over the past 10 years to provide funds needed to be self-insured, maintain an operating reserve, and build a capital improvement reserve for future major capital expenditures. Needed maintenance and repair have been delayed for at least the past six years due to insufficient funds. To summarize, there are no reserve funds, and the fund will end its
FY2009 operations in the hole. In addition, there is a unique opportunity though the federal economic stimulus plan to fund sewer projects through 0% interest loans. Qualification for stimulus funding under IEPA-guidance requires public utilities to show that they have a sufficient rate structure to support payback of the loan. Therefore, O’Fallon needs to increase its rates to ensure payback of the loans. The average increase is 34%. An amendment was approved that removes the sewer lateral and ejector pump programs from the ordinance. In addition, an ordinance will be placed at the next City Council meeting to waive the October CPI adjustment. The rate increase goes into effect on July 1.
Ordinance selling surplus property (First Reading): This is a routine item to sell vehicles and equipment that are no longer needed. Four vehicles and miscellaneous equipment have been identified as surplus and ready for sale. All items will be listed on the internet and sold to highest bidder through an online auction web site.
Special Event Permit for the Salute to Scott Day: This is an annual event for the community to show its appreciation to the military families in O’Fallon. The event will feature the arch helicopter, working dog demonstration, bouncing houses, rock climbing wall, and free food and soda/water for all in attendance. There will be a business expo under the large pavilion as well as tents set up around the pavilion.
Motion to affirm the Zoning Hearing Officer’s decision to deny a sign variance: T-Mobile (1600 W. Hwy 50) requested a fourth wall sign at its business and the Zoning Hearing Officer denied the variance. Following the Hearing Officer’s decision, the City Council has 21 days to review the decision and determine whether to take action.
Tax Increment Financing Ordinances: Five Second Reading ordinances dealing with the proposed Regency Park Tax Increment Financing District are on hold for legal review.
Now you’re up to date. Due to the Memorial Day holiday, committee meetings will be on Tuesday, May 26. Community Development will be held at 5 p.m., Finance and Administration at 6 p.m., and Public Works at 6:30 p.m.
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