From streets, to water, to golf course debt, the Lancaster Common Council held session for more than two and one half hours Monday evening. Along the way, the council also debated whether or not to extend the city’s audit contract, approved volunteers to move forward with a veterans memorial, and had a rare split vote on whether one person could serve on a public commission.
Which street project should be next was on the minds of some council members during the first council review of the 2012 city budget, as alderpersons discussed the merits of projects for North and South Adams Street, East Walnut, and Georgia Lane, all which have been tabbed as high priorities for the city.
“I think they need to be moved up,” Dennis Morgan said of Adams Street projects, which are not slated for 2012.
City Administrator Stephen Crane said that the city’s budget for 2012 has 55 percent of the levy going towards debt service, which he felt was unhealthy, and something that the city will see greatly reduced within three years. This will mean that needs, such as Adams and Walnut streets would not have to be delayed in future years, but the current debt load means delays, with the city alternating every other year with a major reconstruction project.
Current projections show that the city carries close to $700,000 in annual payment for debt service on the levy, but with the expiration of some loans, as well as refinancing of $2.35 million in bonds the council approved Monday, the debt load for the levy will drop to $300,000 in 2016 with no additional borrowing, and be completely eliminated in 2019.
But until that reduction in the debt load, the city is left choosing between North Adams, South Adams, and East Walnut. Morgan noted that in one week the water was shut off four times as city crews made repairs to utilities on Adams Street.
Walnut, on the other hand, has its own utility issues. The council stated they wanted to see the long range capital improvement plan at their next meeting to discuss the street projects.
Elsewhere in the budget, the city’s levy would increase 2.1 percent, to $1.195 million.
Part of the budget discussion dealt with the current status of the city’s golf course. Currently the course has annual payments of $59,600, which includes covering bonds taken out to pay for the nine-hole extension, as well as funds the city has been loaning the course to cover the roughly $300,000 in the cost over the original estimate, as well as covering the difference between the debt payments and the $20,000 the city receives in rent for the course.
“Future generations are going to have to pay for the golf course,” Crane said, recommending the city consider the course an asset of the city’s, like the pool and other items, and directly levy for the course in the budget.
The city will formally adopt a budget next month.
Arrow Ridge looks for help
The council also took action to have one of its tax incremental finance districts (TIDs) help out another that has fallen into distress due to the sluggish economy.
TID 3, which encompasses the Arrow Ridge Business Park, was created in 2006 touted to give the city the ability to attract a larger operation than it could, given the size and fragmentation of properties in the city’s northern business park. The park was the reason for Woolwich Dairy to create a cheese factory in the city, and it was believed that the space would be able to attract other businesses looking to expand. Then the recession of 2008-2009 occurred, and few businesses have looked to expand as the economy continues to find its footing.
This has adversely impacted Arrow Ridge’s TID. A TID works like this - undeveloped land is assessed, with the taxing entities, in this case the city, county, state, and SW Tech, retaining the same amount of tax collection for the land as if it would remain undeveloped over the course of time, up to 20 years. The city would then develop the property, adding streets, utilities, and other infrastructure to make the property attractive to businesses. Those businesses usually pay $1 for the property with the agreement they will build on the property within a certain timeframe. The new building and property are taxed at the same level they would be if located anywhere else, but the additional tax revenue (compared to when the property was undeveloped) goes directly to paying off bonds taken out to pay for the infrastructure, as well as the purchase of the property.
Since the only tennant in Arrow Ridge is Woolwich, the TID is not generating enough money to cover payments on those bonds. Current projections are for TID 4 to collect an average of $48,900 for the next several years, below what was needed for annual payments for the bonds.
To make TID 3 solvent, the city will look at merging it with TID 4, which includes property along Alona Lane. TID 4, which was also created in 2006, planned to make $1.4 million in improvements over 15 years. There has been $2.4 million in new development within the district without any improvements made.
With a change in legislation, the city can take money from TID 4 to help cover costs for TID 3. The city will move forward with the proposal.
Council split on Clauer
Showing a split still remains even after a half-year has passed since the proposed downtown preservation district was voted down by the council, the group held a narrow 4-3 vote to approve Mayor Wehrle’s appointment of Brian Clauer to the historic preservation commission, which had proposed the district.
“I had a hard time finding anyone interested,” Wehrle said in making the appointment, noting he felt Clauer had an understanding of issues from his own research during the district debate, and Clauer’s work on his buildings downtown.
Alderman Shayne Labudda felt that placing Clauer on the commission, after impugning the members of the commission, was an insult. “We had a toothless ordinance proposed,” Labudda said of the proposal, which failed twice this year to get enough votes from the council.
“Everything was negative,” Jennifer Crubel said of Clauer’s efforts during the district debate, where he was the most vocal opponent of the district. “I just don’t think it would be a benefit.”
The commission has been down two members since the beginning of the year when both Jim Halferty and Tom Lucke stepped aside. The council voted to approve the appointment, 4-3, with Jay Janssen absent at the time of the vote. The council had voted in a similar divide as the two votes on the district, with Schmidt joining Crubel and Labudda, while Ihm, Morgan, Kate Reuter and Jack Phalen voted in favor of Clauer.
The council also tabled extending an agreement with the auditing firm which handles the city finances to see if there were better deals available. Under the proposal, which was part of the agreement the city has with Johnson, Block and Co., the city could extend its agreement for another two years. Schmidt had a problem with that extension, as it called for increases in cost of 4.4 and 4.2 percent in each of the two years. “That’s 8.8 percent over the two years,” Schmidt said. “In these times we don’t have to approve an 8.8 percent increase.”
Because there were no time issues, the rest of the council backed Schmidt’s idea to look for a better contract.
The council also pulled from its consent agenda a resolution backing the moving forward with the veterans memorial project planned for Memorial Park. Labudda, who voted for a recommendation of the item at the parks and recreation committee earlier in the month, pulled the item so it could be spotlighted.
“My feeling is this is such an enhancement to the park, they are deserving of a reading,” Labudda noted.
The city will be acting as a fiscal agent for the project, as well as handling excavating work.
