Council members have only a couple of weeks to decide whether or not they will ask voters for money.
The council has until May 26 to file for the August election and a lot of work still must be done to make it happen.
The city may ask voters to approve a bond issue that would generate money to stabilize and rebuild the South Wastewater Plant and address issues at the North Plant. In addition, the city will be asking for money to replace the city’s waterline system.
In total, the city may be seeking as much as $6 million in funding for the projects.
Jack Dillingham with Piper Jaffery said the city is looking at about a 2 1/4 percent interest rate on a bond. He said the city would be obligated for about $160,000 to $170,000 a year in payments with 60 percent going to principal in the first year.
Dillingham said the city has two avenues for bond funding. The first option would be to sell bonds that would be paid back by user fees, meaning higher rates. The other option is to increase the property tax levy. Dillingham said in order to pay the bonds, property owners with assessed valuation of $100,000 would see an increase in property taxes of about $85 a year.
Dillingham said with the stimulus plan passed by Congress, most community projects are receiving a 50 percent grant match up to $2 million. He said in order to get on the list, a bond issue needs to be passed as soon as possible. He said allocations for 2009 are already spent and the city must get on the list for 2010 allocations. He said the city would cut its chances in half by waiting until November.
“It’s first come, first serve in many respects and to get on the planning list to go from, ‘Yeah, we would like to do this’ to ‘yes we’ve got tangible evidence that our community is is willing to do this to a large degree is the bond referendum.’
“It’s the process of having the ammunition in the gun so that they realize that you are serious and you have the ability to do your part,” he added.
“What we’re talking about is getting as high as we can on that list as quickly as we can get there,” City Administrator Rick Childers further explained.
Councilwoman Terrie Stanley said she still has reservations about public opinion. She said she doesn’t know if the city has enough time to educate its residents.
“We have a lot of unhappy people in Richmond and I’m just afraid it’s too soon to go out for an election,” Stanley said. “They don’t understand the world of hurt that we are in, they just know every month when that bill comes. I don’t know if we have enough time to get them to understand that.”
The council may call a special meeting to approve a ballot initiative.