Minutes-5 /20/1964

Minutes of Special Council Meeting, May 20, 1964, Tiffin, Iowa Present: Bob Svatos, Glen Potter, Ted Spivey, Wayne Stratton, Bill Verry, Bill Tucker, Wayne Reed, James Thayer Absent: None The meeting was called to order by Mayor O'Toole for the purpose of deciding upon method of financing of the sewer system. Plans for financing the system as suggested by Mr. Thayer of White-Phillips Company, Inc. of Davenport were discussed, with Mr. Tucker commenting. These plans brought to the attention of the Council the possibility of financing entirely by Revenue and General Obligation bonds, saving bonding capacity for a water system in the future, and paying the bonds entirely by sewer rental collections. In putting in a sewer system, we are permitted by law to make everyone hook on, whereas in the case of water this is not so. By putting water as a special assessment, they will pay whether they hook up or not. White-Phillips would agree to set up any plan the Council would choose; would furnish exactly the same supervisory services as Carlton Beh; would guarantee that revenue bonds would sell for no more than 4-3/4% and General Obligation Bonds no more than 4%; their fee is $2,500. Glen moved, Ted seconded the motion that the Mayor be authorized to enter into, on behalf of the Council, a contract with the White-Phillips Company. Carried unanimously. Mr. Thayer suggested that the flexibility we would get with a thirty-year bond is better; they are callable after 20 years and can be reinvested in government stock and earn up to 4-1/8%. You have to have an extra cushion on these, just enough to pay the principal and interest in case some people don't pay in time. This is in order to make these bonds salable and give protection to the purchaser. A fee should be set (suggested to be at least $100) to be paid by anyone who does not hook up by the time the construction goes by their property line. The advantage of G.O. bonds is the lower interest rate. They are assessed against all the property, whereas the revenue bonds are payable only by users. As Board of Health, the Council has the power to tell the property owner to improve on that basis. Mr. Tucker wants to check schedules and check the method used in arriving at a cost-per-unit basis. Mr. Thayer suggested that the Town seriously consider putting in a municipal gas system. The engineer could make an estimate. Municipal gas bonds are really money-makers. They are usually paid off in ten years and then they pour money into the town. Where your problem arises and there might be a little expense to you is that you should contract with someone to go to Washington for the hearing on the gas allocation, because the one thing you do need is the Federal order for gas allocation for the town. You get a Federal order for the pipeline to sell you gas, and then they will sell it to you; the government sets the price. Wayne moved, Ted seconded the motion to adjourn. Carried. Margie O'Toole TOWN CLERK