Council shopping for interest rates

August 05, 2008 06:22 pm

— By TESA CULLI
tesa.culli@register-news.com
MT. VERNON — The city manager was given approval to begin shopping for the best interest rates for loans to purchase equipment, complete the sewer plant dewaterization project and purchase land at 12th Street and Casey Avenue, with the council also wanting a separate fund or budget line item for receipts of taxes which have been earmarked for capital improvement projects.
The loans are for items which were included in the general corporate capital equipment line item of the budget, and councilman David Wood brought up the idea to keep the tax receipts separate from the regular general corporate receipts.
“I’d like to see the city manager and the finance director work on a way to pigeonhole the tax increase money in a separate fund so we can only use it on capital improvements,” Wood said. “Regardless of how anyone felt about the taxes, we should make sure they are used for capital improvements. It would be easy for the money to make its way to services and expanding services, but that’s not what any of us intended it for. We intend it for repayment of debt for capital projects and capital improvement projects.”
The taxes — a 1 percent restaurant/beverage tax, a 2 cents per gallon diesel fuel tax and a 1 percent increase to the telecommunications tax — were approved two weeks ago by a split vote of the council. The tax ordinances were signed by Mayor Mary Jane Chesley last week, and all taxes are expected to go into effect on Sept. 1.
Councilman Mike Walker, who, along with Chesley, voted against the taxes, said he agrees the money should be used only on capital improvements.
“I’d like to also see it tied with a long-term capital budget,” Walker said. “If we don’t need the taxes, then we could tie it to a tax break in the future. ... We should use it to feed needs, not wants.”
Chesley said she liked the idea of setting the receipts aside.
“I totally agree with you on that,” Chesley said to Wood. “It makes it official and makes us accountable.”
Among the ideas presented by Wood was that an ordinance be drafted that the tax receipt money can only be used for capital projects — unless the council votes on using the money for something else in open session.
“”That way it would require council action to reverse it,” Wood said. “It would be a guarantee to the public that it will be spent in that manner and if not, we voted in a public forum.”
In other business, the council:
n Approved a bid from Rex Braseacher Construction to complete the sidewalk project along North 44th Street and Mateer Drive at the amount of $99,864;
n Accepted a bid from Mainline Information Systems of Oakbrook Terrace for $34,749 for a mainframe computer system and software for city finances, payroll and billing;
n Granted permission for the city manager to seek bids for a new roof at the Municipal Building West;
n Approved a zoning request from Dennis L. Robinson for property at 1221 N. Ninth St., from I1 to RM2; and
n Approved a Lake Miller lease to Larry Johnston.