MONDAY
AUGUST 03, 2009
The Governing Body of the City of Pratt met in Regular session in the Commission Room located in City Hall.
PRESENT: Jeff Taylor Mayor
Bill Hlavachick Commissioner
Eric Nystrom Commissioner
Willy Peltier Commissioner
Victor Graf Commissioner
ALSO PRESENT: Dave Howard City Manager
LuAnn Kramer City Clerk
Ken Van Blaricum City Attorney
Diana Garten Finance Director
Russell Rambat Public Works Director
Steve Holmes Chief of Police
Brad Blankenship Building Inspector Kelly Hemphill Dir. of Electric Utilities
Bruce Pinkall Recreation Director
CALL TO ORDER:
Mayor Taylor called the regular meeting to order. The Mayor instructed the Clerk to note that all Commissioners were present.
Mayor Taylor reminded the audience that the meeting may be taped and/or recorded.
MINUTES:
A motion by Commissioner Nystrom to approve the minutes of the regular Commission meeting of July 20, 2009. The motion was seconded by Commissioner Graf and carried unanimously.
OPEN AGENDA:
Pratt Community College request:
Mr. Lane Gourley addressed the Commission on behalf of the Pratt Community College Student Life Committee. Mr. Gourley explained to the Commission that the committee would like to have a hamburger feed in Lemon’s Park on August 17th from 5:30 p.m. to 9:00 p.m. and they would like to have a live band if possible. Mr. Gourley added that the band would be done by 8:30 p.m. and that this was the first week that the students would be back in town.
Commissioner Peltier questioned if they wanted the park closed. Mr. Gourley stated that they did not and that this was also for the public. Mr. Gourley commented that they were trying to increase the community’s involvement with the school. Commissioner Peltier questioned if they just had to reserve the shelter house. City Manager Dave Howard commented that with the band, this was different than normal and louder than normal. Mayor Taylor commented that as long as it was not as late as midnight, he saw no problem. Commissioner Hlavachick stated that he thought it was a great idea and he had no problem with it either. City Attorney Ken Van Blaricum commented that they usually have it at the college, but the park was a nicer venue. Mr. Gourley commented that a change of scenery could bring more people.
A motion by Commissioner Peltier to allow PCC Student Life Committee to use Lemon’s Park for a picnic and to have a live band on August 17, 2009. The motion was seconded by Commissioner Graf and carried unanimously.
7:00 p.m. meeting time:
Mr. Vince Epp questioned the Commission about changing the meeting time back to 7:00 p.m. Mr. Epp commented that people do not feel that there is enough time to get off work and get to a meeting and more people might get involved if it was at 7:00 p.m. Mayor Taylor commented that he liked having the meetings at 5:00 p.m. Commissioner Hlavachick commented that we had the meetings at 7:00 p.m. for years and nobody showed up, so the time was changed so that we could get out at a reasonable time. Mayor Taylor commented that more show up now than they did at 7:00 p.m.
Commissioner Graf questioned if the Commission would be willing to change for six months and if it does not work they could change it back. Mayor Taylor stated that he saw no need to change. Mayor Taylor commented that this also works for City staff who are already here and can have conflicts with kids in athletic activities. Mayor Taylor commented that there were a few people who thought that we changed the time to eliminate people from coming in and that was not the Commission’s intention.
Ms. Karen Detwiler asked what the chances were of getting the agenda in the paper. Mr. Conrad Easterday of the Pratt Tribune commented that he just has to remember to do it. Mayor Taylor stated that the agenda was also on our website. Ms. Detwiler commented that there are a lot of people that do not have computers and questioned if the City could pay to have it in there. Mr. Easterday commented that they get the packet soon enough to have it in the paper and that this was not a paying job. Mr. Easterday added that the City was not required to pay for it and it was their duty to get it in the paper, not to have the City pay for it.
Liquor Store hours:
Mr. Danny Quint from Quint Liquor addressed the Commission on the liquor store hours that had been discussed at an earlier meeting. Mr. Quint commented that the other owners were not here, but they were trying to get legal with the State. Mr. Quint stated that the stores would like to go to the State law that requires you to quit selling at 11:00 p.m. Mr. Quint commented that they are not intending to change their hours, but want to be legal. Mayor Taylor commented that it had been discussed that they close at 8:00 p.m., but can sell until 8:30 p.m.
Commissioner Graf commented that if Mr. Quint would take an order for the Club after closing hours, the state law would keep him legal. Commissioner Peltier commented that if they are in line with the State law, they can close whenever they want. City Attorney Van Blaricum commented that if we set it with the State law of 11:00 p.m., then they cannot let anyone walk out of the store at 11:15 p.m. Mr. Quint commented that he does not want to stay open until 11:00 p.m. and that the liquor store owners want to keep it simple.
Commissioner Nystrom questioned what happens if their hours were posted that they close at 8:00 p.m. Mr. Van Blaricum commented that they were only breaking the law if they sold after 11:00 p.m., but that the City could change the ordinance to state 11:00 p.m. closing time. Mr. Van Blaricum added that they can still close at 8:00 p.m. and that the City cannot require them to close at a certain time. Commissioner Nystrom commented that posted hours do not matter. Mr. Van Blaricum commented that any sales after 8:00 p.m. with an ordinance change, would not get them in trouble with the State, but could with other store owners.
Mr. Van Blaricum commented that he would have an ordinance at the next meeting changing the time to 11:00 p.m. to match the State law.
BUSINESS:
CONSIDERATION AND APPROVAL TO PUBLISH THE 2010 PROPOSED CITY OF PRATT BUDGET:
Ms. Diana Garten, Finance Director, explained to the Commission that she needed their approval to publish the 2010 Proposed City of Pratt budget that sets a public hearing for August 17th. Ms. Garten commented that there was a 43.789 mill levy charge, which was a 1.192 decrease from last year. Commissioner Nystrom questioned if there could be an additional 1.¾ decrease to make it a flat increase. Commissioner Nystrom added that he wanted a zero increase. Mayor Taylor commented that based on the recent valuation, this was a lowering of the mill levy, but not a lowering of collective funds.
Commissioner Nystrom stated that the budget includes a three percent salary increase and he still had a problem with that for this year and questioned doing a flat $.45 increase instead of three percent. Mr. Howard stated that that was the Commission’s decision. Mayor Taylor questioned how much would need to be cut. Ms. Garten commented that it was about $30,000. Commissioner Nystrom commented that it was about ¾ of a mill. Mayor Taylor questioned if this would come out of numerous contingency funds. Ms. Garten stated that it would come out of tax levied funds. Commissioner Nystrom commented that even with all the new development, he did not feel that we had reduced the tax payer’s burden. Mayor Taylor commented that the reduction of the burden does not lie entirely on the City.
Mayor Taylor commented that the new valuations, which we have no control over, are what increased our revenues. Mayor Taylor added that he did not; however, have a problem cutting another $30,000. Commissioners Hlavachick and Peltier commented that they were not in favor of cutting the 3% salary increase for the employees. Commissioner Nystrom commented that he said that he wanted the mill reduced and that he did not say that it had to be the salary increase.
Mayor Taylor asked Ms. Garten about the deadlines. Ms. Garten stated that the budget had to be published by Wednesday for the hearing to be August 17th and then it had to be to the County Clerk by August 25th.
Commissioner Peltier questioned looking at a couple of vehicles in the capital equipment fund. Ms. Garten stated that capital equipment was not a tax levied fund and that it had to come out of a tax levied fund such as the general fund, noxious weeds or firefighting equipment. City Manager Howard stated that they would look at it and tweak some line items. Mr. Howard added that fuel was one item they could look at where they had been conservative and also sales tax projections. Mr. Howard stated that it was not an undoable task and it would be made a priority.
Ms. Garten commented that the only difference from the budget session was the change in valuations that came from cash reserves and that did not change any of the expenditures discussed in the budget session. Mayor Taylor questioned if the budget publication could be approved before the changes were made. Ms. Garten stated that it could and she would make the changes before it was published. Commissioner Nystrom commented that the mill levy would be a flat 43. Mr. Howard stated that when the budget comes before them at the next meeting, the adjustments would be in there. Commissioner Nystrom stated that the mill levy for 2008 was 45.092, 2009 mill levy was 44.981 and 2010 mill levy would be 43.
A motion by Commissioner Nystrom to amend the proposed budget to a flat mill levy of 43 for the 2010 budget for the City of Pratt and to approve the publication of the proposed budget. The motion was seconded by Commissioner Graf. Commissioner Peltier questioned that the decrease would not go back on the employees. Commissioner Nystrom stated that it would not affect the employees. The motion passed unanimously without further discussion.
CONSIDERATION AND APPROVAL OF CONCRETE CRUSHING BID:
Public Works Director Russ Rambat informed the Commission that he had gone back out for bids for the concrete crushing project. Mr. Rambat stated that the Commission had approved this project earlier, but the contractor could not keep his promise so he had to go back out for bids a second time. Mr. Rambat commented that Stone Sand Company out of Great Bend had bid $30,527.50 and Heartstone Inc. from Wichita had bid $31,650.00.
Mr. Rambat commented that the concrete pile had grown since the initial bid, but this was still a reasonable bid. Mr. Rambat added that this amount was encumbered from last year and that Stone Sand Company would be able to be here around the 17th of August and the project would take about a week to complete. Mr. Rambat recommended Stone Sand Company out of Great Bend in the amount of $30,527.50 for this project.
Commissioner Nystrom questioned who had gotten the last bid. Mr. Rambat stated that it was Mike Leis and that he had visited with these two contractors about the job when he could not do it. Mr. Rambat commented that this would be beneficial material and should last a long time.
A motion by Commissioner Hlavachick to approve the contract with Stone Sand Company in the amount of $30,527.50 for the concrete crushing project. The motion was seconded by Commissioner Peltier and carried unanimously.
CONSIDERATION AND APPROVAL OF RESOLUTION PROVIDING FOR A HEARING ON UNSAFE OR DANGEROUS STRUCTURE AT 517 S. HAMILTON:
Building Inspector Brad Blankenship stated that the resolution was for this hearing on the property at 517 South Hamilton. Mr. Van Blaricum commented that this was the property that had burned several months ago and the owner cannot do anything about it. Mr. Van Blaricum added that this would begin the abatement process if the Commission approved it. Mr. Van Blaricum stated that the public hearing would be set for September 21st and that we would hear any comments about a reasonable time to have it removed or repaired.
Mayor Taylor commented that the owner had no finances to do anything with this property. Mr. Van Blaricum stated that the rumor was that he had moved to North Carolina. Mayor Taylor questioned if the Commission had to give him the usual time. Mr. Blankenship commented that he had sent four registered letters and he had answered the first two, but not the last two. Mr. Blankenship added that he had asked the owner to attend the last meeting and this meeting to state his just cause as to why the structure should not be removed, but he did not show up. Mr. Blankenship stated that he felt we had been very fair to the owner and that it had been a crime scene and that it was no longer sealed up. Mr. Blankenship added that the neighbor was mowing the property, so it was costing us anyway. City Manager Howard added that this individual had been through this process before. Mayor Taylor commented that he appreciated the staff’s time on this property.
A motion by Commissioner Peltier to adopt Resolution 080309 that provides for a hearing on the unsafe or dangerous structure at 517 South Hamilton. The motion was seconded by Commissioner Hlavachick and carried unanimously.
CONSIDERATION AND APPROVAL OF RESOLUTION PROVIDING FOR A HEARING ON UNSAFE OR DANGEROUS STRUCTURE AT 816 W. BLAINE:
City Attorney Van Blaricum commented that this structure was a similar situation except that the house had not burned. Mr. Van Blaricum stated that there were gaping holes in the structure and the garage was in the same shape. Mr. Blankenship commented that this process had started with Police Chief Holmes way back and communication had stopped. Mr. Blankenship stated that the neighbors were complaining about rodents and animals living in the house and that part of the roof was open along with the left front side about ready to fall down. Mr. Blankenship commented that there was trash and 2X4’s on the back and side that were waist deep. Mr. Blankenship stated that the neighbor was complaining since they had to clean up their property.
A motion by Commissioner Peltier to approve Resolution 080309A that provides for a hearing on the unsafe and dangerous structure at 816 West Blaine. The motion was seconded by Commissioner Hlavachick and carried unanimously.
CONSIDERATION AND APPROVAL OF CONTRACT AGREEMENT BETWEEN CITY OF PRATT AND SHERALEE WINDHAM CONCERNING PROPERTY AT 337 N. NINNESCAH:
City Attorney Van Blaricum commented that this was a contract between the City and Sheralee Windham to demolish the property at 337 North Ninnescah and for her to pay for it in three years. Mr. Van Blaricum stated that she had signed the contract today since she was having surgery tomorrow. Mr. Van Blaricum stated that the difference with this structure was that we were going to get it paid for. Mr. Blankenship commented that this structure had been on the list before Mr. McCollum and she wanted it to work out so that she could keep the property. Mr. Blankenship stated that this works out since we do not want the land and she does not have the money upfront. Commissioner Peltier commented that it does need to come down.
Commissioner Peltier questioned the cost to tear down a structure. Mr. Blankenship commented that the house on Sixth Street had cost the City $3400, but that this house would require an asbestos survey. A motion by Commissioner Hlavachick to approve the contract between Sheralee Windham and the City on the demolition of the structure at 337 North Ninnescah. The motion was seconded by Commissioner Graf and carried unanimously.
DISCUSSION ON MAPLE STREET EXTENSION PROJECT:
City Manager Dave Howard explained that there was a diagram in the packet that showed the Maple Street project and he also had it on power point for the audience. Mr. Howard commented that about this time last year, there was a discussion about doing a sub-division east of Maple Street, but with the economic situation the proposal went on hold. Mr. Howard stated that the property had been purchased from Pratt Well and Blake Himmelwright.
Mr. Howard commented that it was discussed during the budget session for next year about what to do with Maple Street and whether it should be paved or left a dirt road. Mayor Taylor added that the dirt would have rock also. Mr. Howard stated that the cost of building the road and crossing the draw and the intersection improvement on Highway 61 would be about $565,000. Mayor Taylor asked if that would be platting all of it. Mr. Howard stated that it would plat four big lots and one of those being zoned commercial. Mr. Howard added that the Baptist Church had asked to purchase part of that area and the larger area would be the main sub-division.
Mr. Howard explained that the crossing or bridge would be designed to meet the one hundred year flood. Mr. Howard commented that construction prices have dropped about 30% from last year and it would cost about $900,000 to complete Maple Street. Mr. Howard explained that the intersection at the church would be closed off and access would be moved over further for traffic control.
Ms. Karen Detwiler commented that normally when a street is paved, curbed and guttered, the adjacent property owners on either side of that street are assessed a special assessment. Ms. Detwiler questioned how this one was going to work. Mr. Howard stated that right now the City owns the property on both sides. Ms. Detwiler commented that the City was not going to own them forever and that this was for people to come and build houses. Mr. Howard commented that this discussion was not about that, but was about Maple Street which would lead into the sub-division. Mr. Howard stated that he did not have an answer to how the lots were going to be priced.
An audience member asked if the box bridge was permanent. Mr. Howard stated that it was and the only thing that would change that would be development to the north. Mr. Howard added that the more development there was, the more water you shed and there was no opportunity for the water to go into the ground. Mr. Howard stated that if, in fifty years, there was another housing development built, it may have to be increased in size. The audience member commented that there were houses there already that have water come up to their doors and she was concerned that this could affect them even more. Mr. Howard assured her that in doing this study it was one of their first concerns.
A member of the audience asked why the road was going to be a dirt road. Mr. Howard commented that the Commission had brought that up during the budget session. The audience member asked why you would spend ½ million now and then a million later. Another audience member asked if the road was going to cost us $1 million dollars. Mr. Howard stated that was being conservative and it should come in cheaper. Mayor Taylor commented that they had thought that the citizens would scream about spending $1.2 million on the road. An audience member commented that they would scream about driving on dirt.
Mr. Howard commented that the growth that was happening in Pratt shows that the area from Highway 54 north to the college as the most likely to continue. An audience member asked if new businesses can take advantage of the revitalization program. Mr. Howard stated that it was different for commercial. The audience then asked if the people that build on these lots are not going to share the tax burden for ten years. Mr. Howard stated that you have to be doing construction to qualify for tax revitalization program and that the purchase of property is different all together. Commissioner Nystrom commented that existing improvements are not included.
The audience commented that there was a small town paying off bonds for something like this that ended up not happening. Mr. Howard commented that the Commissioners had the same concern about the economy and that it was simply an issue about what was going to happen to Maple Street and what we were going to do with this project. The audience commented that the project was stopped due to the economy, but now it was on again and the economy is not any better. Rev. Buller stated that it was thought that politicians do what they want to do without concern to the people. Mayor Taylor stated that Rev. Buller had discussed this with him for two hours and that we do take the citizens into consideration. Rev. Buller corrected his statement and commented that he meant that the citizens opinions are overran and that is how people feel. Rev. Buller added that he was in favor of the road, but people would perceive that the Commission had done it for self-enrichment. Commissioner Peltier asked who was getting self-enriched. Rev. Scott Buller commented that people do not understand and that a majority of the people are not in favor of the project, but are really not in favor of a dirt road. Rev. Buller added that retired folks on a fixed income are looking at a $1.2 million road as a raise in their taxes and they do not know how they are going to pay it. Commissioner Peltier commented that we have the money to pay for it. Ms. Detwiler questioned where the money was coming from. Mr. Howard stated that construction costs are down 30% and if the City had to borrow money, you could do that for almost nothing. Mr. Howard added that interest rates are as low as they can get, but we have not looked at what avenue we are going to take. Mr. Howard commented that raising taxes was not an option.
Rev. Buller commented that the issue now was that the City had not sold this project very well and citizens have not heard what Mr. Howard had just said. Mr. Howard disagreed and stated that it had been on the front page of the paper twice and no one came to the meetings to find out what was happening. Rev. Buller stated that there was a new City Commissioner because of the road and the citizens do not want the road right now.
Ms. Detwiler asked what the benefit to the people of Pratt was going to be to have Maple Street extended. Mayor Taylor stated that it was for future development and the possibility of fifty to seventy new houses and that would spread out the tax base. Ms. Detwiler commented that the future homes on these lots have to have somewhere to work and there is no employment in Pratt. Mr. Howard stated that as a City Manager, his job is to look at the future and the growth from Wal-Mart up to the college to the Industrial Park shows that we are doing quite well. Mr. Howard added that the road was important and it identifies growth. Mr. Howard commented that the high end houses that are being built in Pratt are in the County and we do not benefit from property tax on those homes. Mr. Howard added that at least two of those houses would have been built in the City if there had been somewhere for them to build and we missed out. Mr. Howard explained that that was a bad business deal. Mr. Howard stated that the City was not going to get a return on this in one or two years, but maybe ten. Mr. Howard added that the development on Tenth Street was an example as there are very few lots available today.
Ms. Detwiler asked if the property owners that buy a lot were going to pay specials. Mr. Howard commented that he did not know how it was going to be structured. Commissioner Peltier commented that specials were one of the options that had been looked at. Mr. Howard commented that the purpose of this discussion was not the development. The audience member stated that the whole purpose was the division. Mr. Howard disagreed and explained that from a planners standpoint there are very few streets that you can enter or exit the City from the north and this road provides a shorter distance to get to where people want to go.
The audience asked Mr. Howard to guess how much the project was going to cost. Mr. Howard guessed around $3 million with water, sewer and streets. Commissioner Peltier commented that it could be less now. The audience member stated that it could be higher next year. Mr. Howard commented that we hoped to recover our expenses from the people who buy the property.
A member of the audience commented that the taxes in Basehor, Kansas were half of what they are in Pratt and the people of Pratt should not have more put on them. Mr. Howard stated that the City was not the only entity that collects taxes and that the City has cut the mill levy every year for the last seven years. Mayor Taylor commented that the City was blamed for the high taxes. Ms. Detwiler commented that it does not matter how many taxing entities we have, we still have to pay it. Ms. Detwiler added that the City was one, the County and the college and she understood that the City was going to raise the mill levy for the airport. Everyone quickly cleared up that rumor and that the airport was going to receive the three mill that they requested and had been requesting for years. Commissioner Peltier asked if Ms. Detwiler wanted to close the airport or the college and asked for her suggestions. Ms. Detwiler stated that the citizens do not need any further burden. Mayor Taylor commented that this project would be built without a mill levy increase. Ms. Detwiler stated that it could eventually be like the waterline to the Ethanol Plant and asked if the City was being paid for that. Mr. Howard stated that we were getting that money monthly. Ms. Detwiler asked about the road and asked if the County was getting their money. Mr. Howard told Ms. Detwiler that she would have to talk to the County about that. Ms. Detwiler commented that the people are taxed above their means and they do not feel like they are going to get a benefit at this time. Commissioner Peltier commented that this was an investment into the future.
Rev. Bob Fleener commented that he would like to see the City do the road right the first time and avoid the dirt road. Rev. Fleener added that we do not want to look back five years from now and ask why we did not do it. Mayor Taylor commented that you have to spend money to make money and that it takes time to get money back.
After more discussion and explanations, the audience asked if this could be put to the people for a vote. Commissioner Nystrom commented that a special call ballot would cost the City about $7,000. Mayor Taylor stated that the next election would be in November and Commissioner Nystrom commented that the cutoff for ballot issues was August. Ms. Detwiler suggested a petition. The Commissioners stated that she was more than welcome to bring them a petition to put this on a ballot.
Mr. Bob Epp stated that there were a few people in town that wonder why we are putting in Maple Street when Main Street is in such bad shape. Mr. Vince Epp added that it would help if Main Street was in the works. Mr. Howard stated that the financing was in place for Main Street and the new water line was scheduled for next year and the year after that they would come in to do Main Street. Mr. Vince Epp commented that the Commissioners are used to dealing with a million or two, but that was a lot of money and the people need to know where it is coming from. Mr. Howard commented that the City had tried to do that and nobody came to question us.
Rev. Buller thanked the Commission for listening. Mayor Taylor commented that there was a lot of talk that we do not want the people to show up at our meetings, but that was not the case. Mayor Taylor added that they do talk about a lot of money, but we are not running us down the tubes. Mayor Taylor stated that if he thought that moving the meeting back to 7:00 p.m. would bring more people in he would do it. Commissioner Nystrom commented that with all of his projects, he feels that he is looking out for the citizens ten to fifteen years down the road. Commissioner Nystrom added that the communities’ survival is how he also survives and everything he does revolves around the City. Commissioner Nystrom stated that it takes money to invest and make projects work; which is an investment in the future.
REPORTS:
New motel:
City Manager Howard commented that the new motel was still on track for this fall.
Code updates:
City Attorney Van Blaricum commented that he would have some code updates for the next meeting.
Public Works projects:
• Curb & Gutter:
Public Works Director Rambat commented that the curb and gutter project was a little further than two-thirds done. Mr. Rambat explained that Pine Street needed to be finished along with the area by the hospital. Mr. Rambat stated that the contractor had done a good job.
• Railroad crossing:
Mr. Rambat stated that the railroad crew would be here next week to do the project on Pine Street going into Lemon’s Park. Mr. Rambat commented that it would be in the paper that the street would have to be closed for about a week.
Fire station update:
Building Inspector Blankenship commented that there had been some demolition on the fire station and that they were filling in some holes in the inside. Mr. Blankenship added that the old cooler had been torn down and that the painting was being taken care of.
Electric department projects:
• Line Distribution:
Director of Electric Utilities Kelly Hemphill commented that line distribution was working east of Belmont Street replacing the reconductor with one of higher voltage and should make it safer. Mr. Hemphill stated that this should be able to withstand storms better.
• Power Plant:
Mr. Hemphill commented that the power plant personnel were still working on the cylinder heads.
Generation:
Mr. Hemphill commented that we had been generating due to something going wrong with the transmission line to Medicine Lodge and that we had run our engine at even cost due to the interaction with KMEA and EMP. City Manager Howard commented that we were still generating now. Mr. Hemphill stated that was correct and would be generating until about 8:00 pm this evening.
Basketball tournament:
Recreation Director Pinkall commented that there had been a big basketball tournament last weekend and that the City had supported them by letting them use the Municipal Building. Mr. Pinkall stated that there had been twenty-nine teams that utilized the Municipal Building, Liberty Middle School and the high school.
Commissioner Peltier asked if they would come here more than once. Mr. Pinkall stated that he was not sure. Mr. Blankenship commented that PAYSA had tried to get a MAYB tournament to come here and could not get them, but because of a couple of people that made phone calls, they headed our way. Mr. Blankenship commented that the stands were packed.
Night Out:
Police Chief Holmes commented that National Night Out was tomorrow and that some streets would be blocked off for block parties.
Sales tax report:
Finance Director Garten commented that the sales tax for July was up $10,300 from last year and this was based on May sales. Ms. Garten stated that this was encouraging and that we were up $19,500 from last year. Ms. Garten added that sales tax for this year was at $1,165,000 and that the economy was holding its own. Mr. Howard commented that this would not include the activities at the Sports Complex in June and July.
Snow Storm funded:
Ms. Garten informed the Commission that the March snow storm was going to be partially funded by FEMA and that she had turned in forty-eight hours of overtime.
Utility Clerk position:
City Clerk Kramer commented that she would be doing interviews for the Utility Clerk position this week and that there had been about fifty applications returned to the office.
Cash for Clunkers:
Commissioner Graf commented that he had visited with Mr. Howard and Chief Holmes about looking into the Cash for Clunkers program and the blue Crown Vic. Commissioner Nystrom commented that the program was not for businesses. Mr. Howard stated that it was a good idea if we were eligible.
ADJOURN:
A motion by Commissioner Hlavachick to adjourn. The motion was seconded by Commissioner Graf and carried unanimously.
______________________________________
JEFF TAYLOR, Mayor
(SEAL)
ATTEST:
__________________________________
LUANN KRAMER, City Clerk
Tuesday, August 18, 2009
Thursday, August 13, 2009
08/17/09 City Commission Agenda
MONDAY
AUGUST 17, 2009
PRATT CITY/COUNTY JOINT MEETING – REGULAR COMMISSION MEETING
COMMISSION ROOM – 11:00 A.M.
1. CALL TO ORDER
2. ROLL CALL
3. BUSINESS:
3.1 Discussion Concerning Property Valuations – D.J. McMurry, County Appraiser; Sherry Kruse, County Clerk
3.2 General Discussion Concerning City/County Issues – City and County Commissioners
4. ADJOURN
MONDAY
AUGUST 17, 2009
PRATT CITY COMMISSION – REGULAR COMMISSION MEETING
COMMISSION ROOM – 5:00 P.M.
1. CALL TO ORDER (Remind audience that meeting is being recorded and/or taped.)
2. ROLL CALL
3. MINUTES-August 03, 2009 Regular Commission meeting
4. OPEN AGENDA
5. BUSINESS:
5.1 Public Hearing on the Proposed 2010 City of Pratt Budget - Mayor and Commission
• Open Public Hearing by Motion
• Discussion on Proposed 2010 City of Pratt Budget
• Close Public Hearing by Motion
• Approve 2010 City of Pratt Budget
5.2 Consideration and Approval of the Purchase of Property at Prairie Parkway Business Park – Dave Howard, City Manager
5.3 Consideration and Approval of Resolution Providing for a Hearing on Request for Abatement of Motor Vehicle Nuisance and Property Nuisance at 600 N. Oak Street – Brad Blankenship, Building Inspector; Ken Van Blaricum, City Attorney (RESOLUTION 081709)
5.4 Consideration and Approval of Ordinance Regarding Hours of Retail Sale of any Alcoholic Liquor - Ken Van Blaricum, City Attorney (ORDINANCE 0911)
5.5 Consideration and Approval of Ordinance Providing Modifications to the “Uniform Public Offense Code for Kansas Cities” – Ken Van Blaricum, City Attorney (ORDINANCE 0912)
5.6 Consideration and Approval for a Budgeted Vehicle Purchase for the Water Department – Russ Rambat, Public Works Director
6. REPORTS
6.1 City Manager
6.2 City Attorney
6.3 Department Heads
6.4 Mayor
6.5 City Commission
7. ADJOURN
AUGUST 17, 2009
PRATT CITY/COUNTY JOINT MEETING – REGULAR COMMISSION MEETING
COMMISSION ROOM – 11:00 A.M.
1. CALL TO ORDER
2. ROLL CALL
3. BUSINESS:
3.1 Discussion Concerning Property Valuations – D.J. McMurry, County Appraiser; Sherry Kruse, County Clerk
3.2 General Discussion Concerning City/County Issues – City and County Commissioners
4. ADJOURN
MONDAY
AUGUST 17, 2009
PRATT CITY COMMISSION – REGULAR COMMISSION MEETING
COMMISSION ROOM – 5:00 P.M.
1. CALL TO ORDER (Remind audience that meeting is being recorded and/or taped.)
2. ROLL CALL
3. MINUTES-August 03, 2009 Regular Commission meeting
4. OPEN AGENDA
5. BUSINESS:
5.1 Public Hearing on the Proposed 2010 City of Pratt Budget - Mayor and Commission
• Open Public Hearing by Motion
• Discussion on Proposed 2010 City of Pratt Budget
• Close Public Hearing by Motion
• Approve 2010 City of Pratt Budget
5.2 Consideration and Approval of the Purchase of Property at Prairie Parkway Business Park – Dave Howard, City Manager
5.3 Consideration and Approval of Resolution Providing for a Hearing on Request for Abatement of Motor Vehicle Nuisance and Property Nuisance at 600 N. Oak Street – Brad Blankenship, Building Inspector; Ken Van Blaricum, City Attorney (RESOLUTION 081709)
5.4 Consideration and Approval of Ordinance Regarding Hours of Retail Sale of any Alcoholic Liquor - Ken Van Blaricum, City Attorney (ORDINANCE 0911)
5.5 Consideration and Approval of Ordinance Providing Modifications to the “Uniform Public Offense Code for Kansas Cities” – Ken Van Blaricum, City Attorney (ORDINANCE 0912)
5.6 Consideration and Approval for a Budgeted Vehicle Purchase for the Water Department – Russ Rambat, Public Works Director
6. REPORTS
6.1 City Manager
6.2 City Attorney
6.3 Department Heads
6.4 Mayor
6.5 City Commission
7. ADJOURN
Monday, August 3, 2009
08/03/09 City Commission Agenda
MONDAY
AUGUST 03, 2009
PRATT CITY COMMISSION – REGULAR COMMISSION MEETING
COMMISSION ROOM – 5:00 P.M.
1. CALL TO ORDER (Remind audience that meeting is being recorded and/or taped.)
2. ROLL CALL
3. MINUTES-July 20, 2009 Regular Commission meeting
4. OPEN AGENDA
5. BUSINESS:
5.1 Consideration and Approval to Publish the 2010 City of Pratt Budget – Diana Garten, Finance Director
5.2 Consideration and Approval of Concrete Crushing Bid – Russ Rambat, Public Works Director
5.3 Consideration and Approval of Resolution Providing for a Hearing on Unsafe or Dangerous Structure at 517 S. Hamilton – Brad Blankenship, Building Inspector; Ken Van Blaricum, City Attorney (RESOLUTION 080309)
5.4 Consideration and Approval of Resolution Providing for a Hearing on Unsafe or Dangerous Structure at 816 W. Blaine – Brad Blankenship, Building Inspector; Ken Van Blaricum, City Attorney (RESOLUTION 080309A)
5.5 Consideration and Approval of Contract Agreement between City of Pratt and Sheralee Windham Concerning Property at 337 N. Ninnescah – Ken Van Blaricum, City Attorney
5.6 Discussion on Maple Street Extension Project – Dave Howard, City Manager
6. REPORTS
6.1 City Manager
6.2 City Attorney
6.3 Department Heads
6.4 Mayor
6.5 City Commission
7. ADJOURN
AUGUST 03, 2009
PRATT CITY COMMISSION – REGULAR COMMISSION MEETING
COMMISSION ROOM – 5:00 P.M.
1. CALL TO ORDER (Remind audience that meeting is being recorded and/or taped.)
2. ROLL CALL
3. MINUTES-July 20, 2009 Regular Commission meeting
4. OPEN AGENDA
5. BUSINESS:
5.1 Consideration and Approval to Publish the 2010 City of Pratt Budget – Diana Garten, Finance Director
5.2 Consideration and Approval of Concrete Crushing Bid – Russ Rambat, Public Works Director
5.3 Consideration and Approval of Resolution Providing for a Hearing on Unsafe or Dangerous Structure at 517 S. Hamilton – Brad Blankenship, Building Inspector; Ken Van Blaricum, City Attorney (RESOLUTION 080309)
5.4 Consideration and Approval of Resolution Providing for a Hearing on Unsafe or Dangerous Structure at 816 W. Blaine – Brad Blankenship, Building Inspector; Ken Van Blaricum, City Attorney (RESOLUTION 080309A)
5.5 Consideration and Approval of Contract Agreement between City of Pratt and Sheralee Windham Concerning Property at 337 N. Ninnescah – Ken Van Blaricum, City Attorney
5.6 Discussion on Maple Street Extension Project – Dave Howard, City Manager
6. REPORTS
6.1 City Manager
6.2 City Attorney
6.3 Department Heads
6.4 Mayor
6.5 City Commission
7. ADJOURN
Tuesday, July 21, 2009
07/13/2009-Recessed City Commission Meeting (Budget Session)
MONDAY
JULY 13, 2009
The Governing Body of the City of Pratt met in recessed session in the Commission Room located in City Hall.
PRESENT: Jeff Taylor Mayor
Bill Hlavachick Commissioner
Eric Nystrom Commissioner
Willy Peltier Commissioner
Victor Graf Commissioner
ALSO PRESENT: Dave Howard City Manager
LuAnn Kramer City Clerk
Ken Van Blaricum City Attorney
Diana Garten Finance Director
CALL TO ORDER:
Mayor Taylor called the recessed meeting of July 06, 2009 to order. The Mayor instructed the Clerk to note that all Commissioners were present.
BUSINESS:
2010 BUDGET SESSION:
Finance Director Diana Garten commented that the process for getting the budget ready was to get the departments their worksheets in May and they have a month to put together their proposed budget. Ms. Garten stated that most of the departments were able to maintain their budgets this year and some had even trimmed theirs. Ms. Garten informed the Commission that the total budget for 2010 for the City of Pratt was $28,000,000. Ms. Garten stated that that was up from $27,900,000 over last year due to capital projects, engineering costs and proposed labor costs implemented in the 2010 budget.
• BUDGET HIGHLIGHTS
Labor Costs:
Ms. Garten stated that the 2010 budget includes a three percent (3%) cost of living increase that amounts to $85,000 total. Ms. Garten explained that is being doing due to the elimination of vacant positions. Mayor Taylor asked about the vacant position in electric production. City Manager Howard stated that things have changed from running the steam plant all summer and that employees have quit and we have not filled those positions. Mr. Howard added that those positions have been budgeted until this year and the odds of going to running the steam plant through the summer would not happen. Mr. Howard stated that there were some issues that needed to be decided on the steam plant, but only if we were knocked off the grid in the summer would we need the steam plant.
Mr. Howard explained that when Aquila canceled our contract we covered that need through a firm contract with Jeffries and it was cheaper than the steam plant. Commissioner Hlavachick asked how much we were in for with Sunflower Electric. Mr. Howard answered that the EMP verbally spoke that we would want 40 megs of ownership, with Pratt having eight or nine megs. Mr. Howard explained that his thoughts are that we are not sure where the electrical industry is going to go with the economic down turn, but there is available electricity, which keeps the cost down. Mr. Howard commented that wind generation cannot compete, because electricity is too cheap and the price of nuclear and coal would have to go up to make green energies compatible. Mr. Howard commented that government will have socialized the cost no matter where you get your electricity. Mr. Howard stated that if we have a severe economic downturn, raising everybody’s overhead cost, which next to labor are utilities, would be detrimental to expanding businesses.
Mr. Howard explained that Holcomb was one of those things and that they have to resubmit for their permit. Mr. Howard commented that what happened with Sunflower was that they did not approve their old permit and now they have to resubmit a new permit for approval. Mr. Howard explained that they were going to be sued by the Sierra Club and the State, so the Holcomb plant could be years out in his opinion.
Mr. Howard stated that this was justifying the three percent (3%) raise. Mr. Howard commented that the economy is not showing in the sales tax figures, but we are flat lining a little bit and we do not know how far it will go. Mr. Howard stated that the employees are a big part of what happens in the City and we have good department heads and we need to take care of their needs is important Mayor Taylor commented that Hutchinson had taken it on the chin this year, but they rely on tourism and people coming in. Mr. Howard commented that Pratt is the foundation for government hubs such as KDOT and Wildlife and Parks, along with the City, County, hospital, college and USD’s. Commissioner Nystrom stated that 66% of people in Pratt are government employees. Mr. Howard stated that we have also helped ourselves by promoting tourism with whatever happens to be going on such as hunting in the fall, Lemon Park Lights, Miss Kansas and ball tournaments. Mr. Howard added that it was just not highway traffic that we can take advantage of the lodging tax. Mr. Howard commented that there is a lot of land that has been leased in this area for wind farms, whether they get built or not is questionable, but we are the energy hub here in Pratt. Mr. Howard added that agriculture is as big as it ever was and our economy is pretty diversified. Mr. Howard stated that he was not sure why we were not falling off as much as some communities. Mr. Howard stated that we may not generate the sales tax that we had been, but the budget has always been conservative with projecting that, because it can fall quickly.
Commissioner Nystrom questioned if we were going to be able to do the three percent (3%) if the cost of living is not positive. Ms. Garten stated that that was basically terminology. Commissioner Nystrom commented that he had always been a major advocate for the City, but we have a lot of people out there that are hurting. Ms. Garten stated that that was why we were trying to justify the funding of it by the cuts. Mr. Howard added that we were sensitive to that. Commissioner Nystrom stated that he was not against the merit raises or adjustments, but he was just concerned. Mr. Howard stated that it was in the budget, because we can afford it and we want to take care of the employees. Mr. Howard added that he knows that not everybody in the community is going to give their employees a raise this year and he knows what is happening at the hospital and the school systems. Commissioner Nystrom commented that they are all taking sacrifices and that State workers are taking mandatory leave. Mr. Howard stated that this may not go over well, but it reflects that the City has been taking care of itself. Commissioner Nystrom stated that it is on the shoulders of the tax payer. Mr. Howard stated that we try to minimize that as much as we can. Mr. Howard added that it was in the budget, but it was not going to be approved today so the Commission has time to think about it. Mr. Howard commented that it has never happened, but we could always meet again to discuss issues before the public hearing on August 17th. Commissioner Nystrom stated that this was something to think about, because there are people out there that are hurting. Mayor Taylor added that that was something that we need to look at this year.
Commissioner Nystrom commented that with the proposed decrease in the mill levy, we are still taking another out of the tax payer and it is not a balanced budget. Ms. Garten stated that tax levy was up about $39,000 and that was based on increased valuations. Commissioner Nystrom stated that to get it down to a truly flat levy, we would have to take it down to forty-two. Mr. Howard commented that he was hesitant to do that and that the mill levy has not gone up since he had been here except for one year. Mr. Howard added that the worst thing you can do is to cut it and then have to go back and raise it. Mayor Taylor commented that we have been able to do that with the cut of the half cent sales tax. Commissioner Nystrom stated that we have lowered the mill levy, but we have not cut the tax burden. Mr. Howard commented that that was true, but we were not responsible for the additional tax burden. Commissioner Peltier stated that the school district had made those kinds of efforts during the Howard Gray era and they paid for it later. Commissioner Peltier stated that he was not for making those kinds of cuts. Mr. Howard commented that in all honesty to what Commissioner Nystrom was saying, we could make those kinds of cuts this budget, but it may down the road. Mr. Howard added that with property tax you want to be careful when you go up and when you go down. Mr. Howard explained that if you look good one year, but you have to go up the next year or two, that shows poor financial management. Ms. Garten explained that the mill levy is tied to only six of the funds and so lowering the mill levy would impact the general fund, the bond and interest fund and noxious weeds. Commissioner Nystrom commented that the mill levy was a very small part of our budget. Ms. Garten agreed. Ms. Garten added that the salary increase is across all of the enterprise funds, so that if you want to take that out and decrease your bill, it would have an impact in other areas. Commissioner Nystrom stated that we come through these budgets unscathed from the public in the past and he sensed a little more danger this year.
City Manager Howard stated that they had visited about the raise, but the City can afford it. Mr. Howard added that the perception may be that we are doing it when most other taxing entities are hurting. Mr. Howard explained that looking at information that he gets on sales tax in town, it is not showing problems. Commissioner Nystrom commented that it was like the housing bubble and someday it was going to pop. Ms. Garten stated that she had heard in the news that State wide retail sales were going to be up for the summer and that people were not cutting back as much as they had thought earlier. Mayor Taylor commented that the Wichita housing market is down and that there were a lot on the market, but not being picked up.
Commissioner Nystrom commented that we were the only community in the State of Kansas where valuations have increased and he knew that we have nothing to do with that. Mr. Howard stated that in his opinion they should not have gone up, but from his experience, Counties lag behind by three years. Commissioner Nystrom stated that every day you hear that valuations have plummeted such as in Wichita, Hutchinson and Kingman, but Pratt has had a miraculous $2 million increase. Mayor Taylor commented that you have to question if it is property valuations or an increase in new valuations. Mr. Howard stated that that was a good point as the old houses are coming off the revitalization program. Commissioner Nystrom commented that if you own property, you would think that the houses that are on the revitalization program that have depreciated would offset the new ones coming on by 100 to 1 ratio. Mayor Taylor commented that we had some increases due to Greensburg and it should not have continued to increase. Commissioner Peltier commented that our inventory is way down. Commissioner Nystrom stated that you do not sell a house today for what you could sell it for last year. Mayor Taylor commented that there are houses that are not selling.
Mayor Taylor asked if the County has to approve the appraiser’s increases. Mr. Howard stated that he thought that they did. Commissioner Peltier questioned if the State puts pressure on the appraiser also. City Attorney Ken Van Blaricum commented that he did not think that the State puts pressure on the County overall. Mayor Taylor commented that they say there are the same type of guidelines all across the State and they cannot do anything about that. Commissioner Peltier commented that it was his understanding that when Greensburg happened, everything went up and everything sold and the State looked at that and saw that the valuations had gone up. Commissioner Peltier commented that he had visited with the appraiser about that and he had said that he was appealing that to the State, but that they have some input. Commissioner Peltier added that the County cannot say that they do not want to go up. Mayor Taylor commented that they were not going to put all the responsibility on themselves and that they are going to defend their employer. Mr. Howard commented that the article on the news stated that Pratt had the highest valuations and they were questioning what was going on in Pratt and that they far exceed the normal. Mayor Taylor stated that the numbers were somewhat slanted and that there was an increase of 130%. Commissioner Nystrom agreed with the 130% as he had pulled his valuation and it was 130%. Mr. Howard commented that you have to wonder if this should be happening today with the local economy being down, but no place will be going untouched. Commissioner Nystrom commented that main street Kansas was in grave danger. Mr. Howard agreed. Commissioner Peltier questioned why Commissioner Nystrom thought that. Commissioner Nystrom stated that he knew some things and that commercial real estate space was going to come available. Mayor Taylor commented that you have to look at the plant cuts and auto dealers closing. Mayor Taylor added that Mr. Howard was correct when he stated that electricity was going to be used less and production will be down a lot. Mr. Howard agreed and added that if you go to the mall or Wal-Mart it is warmer than it used to be.
Mr. Howard informed the Commission that the new motel is still going to build. Mr. Howard commented that the Sports Complex, even with an economic downturn, many people may not be traveling this summer and stick closer to home and go to games at the Sports Complex. Mr. Howard stated that his biggest fear was losing the car dealerships and added that that would be bad.
Mayor Taylor commented that to budget gas at $4 to $5 per gal gives us a buffer. Ms. Garten stated that last year at this time gas was $4 per gal. Mr. Howard commented that if you read the national news with what is going on in the world, with any war the price of oil will go through the roof, but oil should go down if there are no other factors.
KPERS:
Ms. Garten stated that the employer’s rate for KPERS was going up to 2.71%, which was up 6.54%. Ms. Garten elaborated more on the tax levy discussed by Commissioner Nystrom and the City is levying $39,000 more in the 2010 budget, if adopted. Ms. Garten added that there are the uncontrollable costs that are increasing, such as KPERS and insurance. Ms. Garten stated that we are incurring more costs than what we are going to raise the tax levy by. Mr. Howard commented that health insurance rates were going up 9.9% this year. Commissioner Nystrom commented that he just wanted to remind everyone not to go trumpeting your horn that we lowered the mill levy. Mayor Taylor stated that we lowered the mill levy and it was the County’s valuations that went up, so we should call it as it is. Commissioner Peltier stated that the cost of doing business is going up. Mr. Howard explained that along with the 3% raise, the City is picking up the $68,500 increase in the health insurance. Commissioner Peltier commented that you could say that employees are getting a 5% raise with benefits. Mr. Howard repeated that he wants to take care of the employees and that was what he was trying to do here and he expected to be challenged. Commissioner Peltier commented that he would rather see us buy one less tractor than not take care of the employees.
Commissioner Hlavachick questioned the part-time salary in the recreation department. Mr. Howard explained that that had been over budgeted the last couple of years. Commissioner Graf questioned part-time help being paid $25,000. Mr. Howard commented that that was for a combination of part-timers such as umpires, summer help and a lot of people that are funneled in and out. Ms. Garten added that it was also diamond workers and concession stand workers.
Property and Insurance:
Ms. Garten stated that property and insurance costs had gone up this year too. Ms. Garten explained that our insurance revalued our property and it went up. Mayor Taylor questioned if this was through the County. Ms. Garten stated that our insurance company does their own. Mayor Taylor questioned if the County even valuated our property. Mr. Howard stated that they found out in Greensburg that they were not doing valuations on City and County property and they were looking back at buildings and they were worth nothing. Mr. Howard added that FEMA suggested starting to valuate City owned property.
Commissioner Nystrom questioned if we were paying boiler insurance if we were not firing up the boilers. Mr. Howard stated that it was expensive, but you cannot let that lapse. Mayor Taylor stated that if you let it lapse and had to fire it up, you could be talking millions if something went wrong. Mr. Howard commented that they do blow up on occasion. Mr. Howard commented that he would be talking about replacing the cooling tower later and that would cost about half a million dollars.
Mill levy:
Ms. Garten stated that the proposal was to reduce the mill levy by 1.2 mills. Ms. Garten commented that the valuations came in at $37,190,489, which was up $1.5 million from last year. Commissioner Hlavachick questioned what a mill was worth. Ms. Garten stated that it was worth $34,141 this year.
Fuel Costs:
Ms. Garten stated that the fuel costs were budgeted at $6 per gallon last year and we had come out ahead. Ms. Garten explained that it had been lowered this year to $5 per gallon to help out other expenditures. Ms. Garten commented that we do not know where that is going.
Street project:
Ms. Garten stated that the street project in this budget was the North Main Street project. Ms. Garten explained that she had thought that the project was to be let in December when this was put together and it still might, but it may not get done until 2010.
Engineering costs:
Ms. Garten stated that preliminary engineering costs had also been budgeted. Ms. Garten commented that she understood that we would be boaring the water line on the Main Street project in 2010 and that would be coming out of the capital improvement fund for $1 million. Ms. Garten added that that may have to be increased, because that water line is going to cost $1.2 million to $1.3 million. Mr. Howard commented that construction projects have been coming in at about 30% cheaper than they have in the last two to three years and that was an advantage to putting this project off. Mr. Howard stated that there are peaks and valleys in construction as anything else, so the price of doing a project can go down.
Mr. Howard stated that there would be a savings in cost since we are running the service lines to the buildings and even into the buildings and not tying onto a forty year old line. Mr. Howard added that if something goes wrong down the road, the City would be the one to go in and replace it. Ms. Garten stated that we also have the loan in place from Kansas Public Water Supply Loan Fund.
Mayor Taylor questioned if we were going to do the sidewalks also. Mr. Howard stated that his plan was to do the water line, then the street, then the sidewalks. Commissioner Peltier asked if they all have back doors. Mr. Howard stated that it would depend on the business. Mayor Taylor commented that it would be tough for a few businesses, because they would have to have someone back there to monitor activity. Mr. Howard commented that we will have to wait and see what shape the sidewalks are in after the street project, but that project has not been put together yet. Mayor Taylor stated that we should get rid of the trees.
Ms. Garten informed the Commission that, due to budget cuts at the State level, we lost $24,000 in 2009 in the City/County Highway funds. Ms. Garten stated that those are the funds used to fix street and curb and gutter projects along with the ¼ cent sales tax. Ms. Garten added that we did have to lower the budget for those projects in 2010. Ms. Garten commented that we also decreased the sales tax revenue by about ten percent.
Capital Outlay:
Ms. Garten stated that this was where the list of equipment the department heads are anticipating needing in 2010. Ms. Garten commented that each department has an equipment budget line item.
• City Clerk
Ms. Garten stated that the City Clerk’s budget shows that they are going to replace the Sensus Handheld devices, because they are no longer supported. Ms. Garten stated that there is no choice but to replace them.
• Pool
Commissioner Hlavachick questioned looking at the liner. Ms. Garten commented that we would be looking at that later in the discussion topics. Mayor Taylor asked if we would get by with the liner this year. Ms. Garten stated that we should and maybe a few years. Mr. Howard commented that the liner has ripped twice this year, but it was in the shallow end.
• Fire Department
Ms. Garten stated that the fire department was looking to replace their thermal image camera.
• Parks Department
Ms. Garten stated that the parks department was looking at purchasing a 300 gallon water tank as theirs is not functioning very well.
• Pool
Ms. Garten stated that the pool needs to replace the soda ash mixer and chlorinator for about $5,000. Ms. Garten commented that they have also budgeted $2,500 to get more deck chairs and that the current chairs were a positive impact at the pool. Mr. Howard commented that those came out of the travel and tourism money.
Commissioner Nystrom questioned the numbers at the pool this year. Ms. Garten stated that they were up. Commissioner Nystrom asked if the season passes were up or down. Ms. Garten stated that they stayed about the same, but the daily receipts were up. City Attorney Van Blaricum commented that the swim meets this year brought a lot of people to town.
• Recreation Department
Ms. Garten informed the Commission that the recreation department was looking to replace a pick-up.
• Maintenance Department
Ms. Garten stated that they are doing some painting and kitchen flooring at the Municipal Building
• Travel and Tourism
Ms. Garten commented that they have suggested the purchase of a kiosk directory for the Green Sports Complex. Mr. Howard added that this was something similar to what you would see in a mall and he had gotten an estimate of $60,000 for what we were wanting to do. Mr. Howard stated that this would let travelers know where to stay or eat in Pratt and it would be a good purchase. Commissioner Peltier asked if we would be able to add and subtract businesses. Mr. Howard stated that we would and that this would be at no charge to the businesses. Commissioner Nystrom asked if this was coming out of travel and tourism funds. Ms. Garten stated that it was.
Ms. Garten explained that the travel and tourism funds are the guest tax receipts from the bed tax. Ms. Garten stated that there was about $350,000 in that fund and it has increased a lot in the last couple of years. Mayor Taylor questioned what the bed tax was currently. Ms. Garten stated that it was at 7%. Commissioner Nystrom asked what the plan was for holding on to that money. Mayor Taylor commented that they are limited on what they can spend it on. Mr. Howard commented that they do buy advertising with it and signage that promote the community. Mr. Howard stated that the City gives them $70,000 a year and the majority of that is used for advertising.
Mr. Howard commented that Mr. Bob Green had visited with him in 2003 and had given the City nineteen or twenty acres east of the ball complex thinking that there could be a soccer field and track. Mr. Howard explained that this cash pool originally started with the expansion of the Sports Complex project. Mr. Howard added that the most expensive thing right now would be the kiosk.
Commissioner Graf questioned using some of that money to do something with the nativity scene that people see all the time and it was in bad shape. Commissioner Graf commented that he had visited with Chamber Director Brian Hoffman and it would cost about $7,000 to get it to where it needs to be. Mr. Howard stated that he would suggest that to them and see if tourism would pay for it. Ms. Garten reminded the Commission that they had applied for a grant and had been denied.
Mr. Howard commented that this money could actually fund the recreation department if the general fund gets pinched. Mr. Howard added that you do not want to deplete this fund though, because it can be used in other areas.
Commissioner Nystrom asked if the new owners of McDonald’s had opted to keep the advertisement at Green Sports Complex and what kind of contract did they have. Ms. Garten stated that it was paid for and that the contract was for ten years. Mr. Howard added that the previous owner paid it in full and that we were only four or five years into it.
Mayor Taylor asked what the recreation budget was. Ms. Garten stated that it was $418,000.
• Electric Production
Ms. Garten commented that the electric production was looking at purchasing drive by equipment.
• Electric Distribution
Ms. Garten stated that electric distribution had budgeted to replace their hydraulic crimper again in 2010 since it did not look like they were going to get it purchased in 2009 and a new computer.
• Water Department
Ms. Garten stated that the water department would like to replace a computer also. Ms. Garten added that they also have equipment that they buy each year for rotational upgrades to the water system.
Equipment Purchases:
• Finance Department
Ms. Garten stated that the finance department does a computer replacement on a rotational basis each year. Mayor Taylor asked if those computers go out some place else. Ms. Garten commented that they are given to the ones in most need of it and they are reformatted. Mr. Howard added that if a computer is five years or older, it would not handle the new software.
Commissioner Nystrom asked about a drop box for bill pay. City Clerk Kramer commented that we had talked about it when the post office box was being relocated and it was thought that the corner of Fourth Street and Ninnescah Street would be a good location, but nothing came of that. Commissioner Hlavachick asked about the house next door. Mr. Howard stated that they keep that rented. Commissioner Nystrom commented that he was in the office the other day on a due date and the foot traffic was unbelievable. Ms. Kramer commented that there are citizens that like to hand you their payment so that they are sure you got it.
• Parks
Ms. Garten stated that the parks department is budgeting for a replacement pick-up.
• Cemetery
Ms. Garten informed the Commission that the cemetery had put in the budget to purchase a new mower.
• Line Distribution
Ms. Garten stated that line distribution would like to purchase a new phone system in 2010 as theirs is pretty old. Ms. Garten commented that they have also budgeted for skid steer attachments and an additional 4X4 truck.
• Water Department
Ms. Garten stated that water department was budgeting for a new handhelds and AMR system that includes software.
Reserves Total:
Ms. Garten commented that we have budgeted $750,000 in capital reserves for several years. Ms. Garten stated that we do not usually spend all of it, but it gives us the budget authority in case we need to.
Old Crown Vic:
Commissioner Graf questioned what the police department was going to do with the wrecked police car that was sitting on Third Street. Mr. Howard stated that it would be auctioned off at some point. Commissioner Graf commented that it should be moved from time to time since the City has an ordinance about vehicles sitting in one place for a period of time. Mr. Howard stated that they do leave it there just in case it would be needed and that he would talk to Chief Holmes about moving it. Commissioner Graf asked if it could be put down at the park department until it is auctioned off. Mr. Howard commented that that area is more for junk and this vehicle is still operable, so we need to find another place to put it. Mayor Taylor stated that it would be nice to move it once in awhile. Mr. Howard stated that Chief Holmes budgets for two vehicles, but he is only buying one and encumbering the other one to buy the next year.
Commissioner Graf questioned how many police cars we have. Mr. Howard stated that he was not sure, but he thought around thirteen. Commissioner Graf stated that it looks funny when you have a police car sitting at houses. Commissioner Nystrom suggested that the next time any of the Commissioners are questioned about the police vehicles is that you ask them if they have been a victim of crime, do they know of any major crimes in the City and then ask what the magic number of officers is before you are a victim of crime. Commissioner Nystrom commented that the person he was talking to about this told him to forget the question. Mr. Howard stated that the logic behind officers having the vehicles parked at their homes is that it may prevent a break-in. Mr. Howard added that this also keeps the mileage down and the vehicles are kept longer. Commissioner Nystrom stated that we have the lowest crime in Pratt per capita in the United States. Mr. Howard commented that if an officer is responsible for a vehicle, they get better maintenance.
Information section:
Ms. Garten stated that the informational section showed how the City has been budgeting for the last five years in the non labor category. Ms. Garten commented that the general fund has stayed consistent and we try to maintain a minimum level. Ms. Garten added that the last four years the only increase in the general fund was about 4% and that was mainly the uncontrollable cost such as insurance and fuel. Mr. Howard stated that that was not the fault of the department heads and not caused by overspending. Mr. Howard stated that we are not spending just to be spending. Ms. Garten explained that this is the actual budgeted amount and the expenditures came in less.
Ms. Garten stated that the electric enterprise fund showed an increase in 2008/2009 when we joined the EMP2. Ms. Garten explained that we had decided that we needed budget authority in case we had to fire up and produce. Ms. Garten commented that we increased that budget with the intent that we would not spend all of it and that we would either purchase the power, produce the power and if we produced power, were going to sale it. Ms. Garten stated that if we sold it to other Cities, our revenue would also be up. Mayor Taylor questioned if that was why the revenue was always so high and comes in under budget. Ms. Garten stated that was correct and that you have to do that if you are going to budget the expenditures.
Mr. Howard commented that the big item is to have the money to purchase natural gas. Mr. Howard stated that in a later discussion, this was all going to wrap around the cooling tower. Mayor Taylor questioned where we were on our natural gas contract. Mr. Howard stated that a big part of Mr. Kenny Kreutzer’s job is to analyze the data that we get. Mr. Howard commented that Mr. Kreutzer had noticed that Russell had pre-purchased some gas on their own in May and Rainbow wanted both of us to purchase it at $3.50 per MCF. Mr. Howard stated that he did not want to do that as he thought that it would go cheaper. Mr. Howard explained that we did not purchase any and Russell did and they are now getting burned and that we are buying it $.50 to $1.00 cheaper on the daily market. Mr. Howard stated that Rainbow, who is our electrical agent and works for KMEA and serves the EMP2, had been plugging in the daily price for Russell’s gas, but KEMA was billing for the purchase price. Mr. Howard informed the Commission that we finally got through to them that we should be at the top of the generating list and we are now making about $10,000 every day that we generate instead of losing. Mr. Howard stated that this comes off of the billing from KMEA, which lessens our cost to the customers. Mr. Howard stated that the threat he made was that he would cancel the contract and he reminded the Commission that there was a 30 day out in the contract. Mr. Howard added that he would not have canceled the contract, but it did get straightened out. Mr. Howard stated that Rainbow said that they were trying to do the best thing for Russell and they were told that Pratt does not care about them and that we have to take care of ourselves.
Mayor Taylor questioned if the cost was down now. Mr. Howard explained that you can buy from three markets and the daily market is the way to go. Mr. Howard stated that the peaking power is from burning gas and our cost for generating plus 10% is five to five and a half cent range. Mr. Howard added that if this were a year ago we would have been paying $100/$150 per mega watt and now we are paying about $50 per mega watt.
Mr. Howard stated that the daily market, where you buy it a day ahead, is the way to go, and he thought we were probably buying under $3 and anything under is a steal. Mayor Taylor commented that he remembers when we used to have to lock in for a year. Mr. Howard stated that the plan is that if the future market drops to the $2/$2.20 range, we probably would purchase out to next summer, but that would take a significant fall and that could happen. Mr. Howard commented that there is a lot of gas out there and they have shut down wells because there is so much. Mr. Howard also explained that you are not going to see this on your bill because you get billed the price that they put it in storage, so that is what they sell it to you for.
Ms. Garten stated that the sanitation department showed an increase in 2009/2010 due to the landfill charges that we have had to start paying and fuel costs.
Ms. Garten stated that the wastewater department looks high in 2006 due to a restructure in the debt and that the transfer was dropped in 2008 from the general fund. Mayor Taylor questioned how much we had been transferring. Ms. Garten stated that it was $100,000 and that at that time the general fund did not need it and the wastewater fund needed buildup in reserves.
Mr. Howard commented that the biggest problem at the wastewater plant is the sludge disposal and we have talked about a belt press or some way to get out of hauling it out. Mr. Howard stated that it was cheaper to bag it and haul it to the landfill, but the cost to do that is about $2 million. Commissioner Hlavachick asked if you had to have drying fields. Mr. Howard explained that you used to, but there are other ways now.
Ms. Garten stated that the water department increase in 2008 was due to the bond payment for the Ethanol Plant and the Ethanol Plant has covered those on the revenue side. Mr. Howard commented that the Ethanol Plant is actually tied into the Sunflower H2O project and he would explain that later. Mayor Taylor questioned if we were still making the bond payment. Ms. Garten explained that we are and that we have to budget on the expense side so that we have budget authority to spend that money, but we get the revenue coming in from the Ethanol Plant.
Mayor Taylor asked if there was any word on what the Ethanol Plant was going to do. Mr. Howard stated that he had dealt with Mr. Ted Loomis when we were concerned about getting the bond payments from Gateway, but we always got them. Mr. Howard explained that Mr. Loomis was involved with the bankruptcy and he had told him that there is a financial plan in this Chapter 11 and they are working through each organization until things are settled, which could be six months to a year. Mr. Howard commented that the plant would not sell until all that is taken care of. Mr. Howard stated that as long as they are handling this, the Ethanol Plant will be servicing the debt. Mayor Taylor questioned how long the bonds were for. Mr. Howard stated that they were for ten years. Ms. Garten added that they have paid half the debt.
Mr. Howard reminded the Commission that the grant loan for the Ethanol Plant started out as a grant/loan and it had been converted to a full grant. Mayor Taylor commented that, contrary to popular opinion, this was a win/win situation for the City. Mr. Howard added that we put the water line in for about half the price, but in the north side of town from the water tower and down Highway 281, there were only multiple small mains and the fire service barely existed, we got the Ethanol Plant to improve those lines and they paid for it. Commissioner Nystrom added that we also own it. Mayor Taylor stated that when the bypass gets here, we will have water out there. Mr. Howard stated that the airport has problems with their wells and if we have to shut down one of those wells, we could be drawing the contaminants to the other well. Mr. Howard explained that he had visited with the USDA and we would get 100% funding to replace those lines.
Mr. Howard explained that we had bought easements on private properties and if the lines have to be moved for the bypass, the State would have to pay for it. Mayor Taylor commented that a lot of people are finding out that this was a good deal, but they still wonder about the road we had to pay for, the water line they had to pay for at the taxpayer’s expense and the plant is just sitting there. Mayor Taylor added that in all fairness to the Ethanol Plant, if they had been in production when they should have been and not had those problems, they would probably be running today. Mr. Howard commented that the plant is still there, but our thinking was that with the bypass going in, we did the infrastructure on someone else’s dime.
Capital Equipment Reserves:
Ms. Garten stated that this had been discussed earlier and it had been maintained at the same amount for years. Ms. Garten commented that she had increased capital equipment reserves in 2009 due to the big projects such as the fire station and the Main Street project. Mayor Taylor commented that the last two were contingencies. Ms. Garten stated that was correct and that we had saved for them and then we have budgeting authority to spend it. Ms. Garten commented that this is where you plan to use a portion of the funds for an upcoming project. Mr. Howard added that we had been planning on the Main Street project and we would be paying for it, so there will not be a bond issue or taxes levied. Mr. Howard stated that if we boar the water line on Main Street, it would come out of this authority. Mayor Taylor commented that the bricks are in poor shape and so is the water line and questioned if they would be taking out the bricks if we boar the water line on Main Street. Mr. Howard stated that that had just come up and that it makes sense to do it in two phases. Mayor Taylor asked how you do that. Mr. Howard commented that they would boar block by block and that the service lines are a bigger headache than the mains. Mr. Howard added that we do not want to disrupt the businesses any longer than we have to. Commissioner Hlavachick asked if we were looking at 2010 to do the water line. Ms. Garten stated that was correct. Mr. Howard commented that we would do it when business is slow and that we would start in the spring and be done by the holiday. Commissioner Hlavachick questioned if boaring the water line would affect the businesses less. Mr. Howard stated that it would. Mayor Taylor asked if it would be done block by block when doing the service lines. Mr. Howard stated that was correct.
Commissioner Hlavachick addressed his concern about doing the street at all and interrupting business with the economy the way it was. Mr. Howard commented that we have pushed the project out as far as we can. Mr. Howard explained that when planning this project we thought it would happen before 2011 and if a business was going to fail due to the economic downturn, it would be before that. Mayor Taylor commented that it would not hurt as much here as it would in Hutchinson and Wichita. Commissioner Nystrom suggested that some of this money may have to be used for relief funds.
Mr. Howard commented that the Chamber would be handling customer parking and notifying businesses of what was going to be made available. Commissioner Nystrom added that there would be parking at the J.C. Food’s Building also. Mr. Howard showed the Commission a map of the water line project.
State budget forms:
Ms. Garten stated that she had put in the State budget forms for the Commission to review and that if it is approved, then she would submit it to the County Clerk and she then sends it to the State. Ms. Garten commented that it is all to be done electronically this year.
Detailed worksheets:
• General Fund Summary:
Ms. Garten stated that we budget the revenue on five years of history and an estimate of what we think could happen and we take the conservative approach. Ms. Garten informed the Commission that the mill levy set for the general fund was 28.958 mills. Ms. Garten commented that not much else had changed from last year in the general fund.
• City Commission:
Ms. Garten stated that this fund was the same last year with the exception of the salary portion.
• City Manager:
Ms. Garten stated that this fund did not have the salary changed from last year even though it looks as though it has. Ms. Garten explained that the Commission had given Mr. Howard an increase after the budget had been approved last year.
• City Attorney:
Ms. Garten stated that this fund was the same as last year.
• City Clerk:
Ms. Garten stated that the fuel cost had been reduced in this fund, but nothing big had changed.
• Finance:
Ms. Garten stated that this fund was the same with the exception of computer replacements.
• Police:
Ms. Garten commented that there were no real changes in the police budget. Mayor Taylor asked if they were at full compliment. Ms. Garten stated that they were.
• Animal Control:
Ms. Garten stated that this budget had stayed the same. Mr. Howard commented that it appears that the Pratt Area Humane Society has gotten their act together. Mr. Howard stated that it has been discussed with Chief Holmes that when the animal control officer retires, we turn it over to the Humane Society. Mr. Howard commented that we would continue to fund them. The Commission and staff discussed the Humane Society situation for a short time.
Ms. Garten pointed out that the $1,000 donation to the Humane Society is taken from this fund. Commissioner Nystrom questioned where the $15,000 was funded from for the LEC. Ms. Garten stated that was in the Capital Improvement Reserve fund. Mayor Taylor questioned when the last time that committee met. Commissioner Nystrom stated that he did not know, but that the County had not budgeted anything for their LEC share, so they now have no air conditioning. Mayor Taylor commented that there was $150,000 sitting there to be used on the LEC. Commissioner Nystrom stated that the County was reluctant to do anything, because there is no money there.
• Municipal Court:
Ms. Garten stated that there were no changes in this fund.
• Fire Protection:
Ms. Garten stated that the fire department still budgets for equipment and the new fire station. Ms. Garten added that they also make a transfer to the capital equipment reserves for fire equipment and they wanted to point out that in the future they need to look at a new fire engine, which would cost about $300,000. Commissioner Nystrom questioned how long we have to pay on the leased truck. Ms. Garten stated that it would be paid off in 2011 and that those payments were $23,900.
• Planning & Code Enforcement:
Ms. Garten stated that this fund was up a little bit due to finally hiring a code enforcement officer. Commissioner Nystrom asked if this was where housing demo money comes from. Ms. Garten stated that it was. Mr. Howard added that he has $20,000 in his budget under professional services. Ms. Garten stated that code enforcement had $30,000.
• Parks:
Ms Garten commented that there were no changes in the park department that had not been discussed earlier.
Commissioner Hlavachick stated that he had gone to the KMU meeting in May and they had some Cities that put back $2,000 or so to replace trees from the 2007 ice storm. Commissioner Hlavachick explained that there would be a cost sharing between the City and the person in the amount of $150 or so. Commissioner Hlavachick stated that he would like to see the City do something like this and was not sure which fund would be appropriate. Ms. Garten commented that it could be put in the parks trust fund. Ms. Garten asked if Commissioner Hlavachick was suggesting doing this on private property. Commissioner Hlavachick stated that was correct and we could donate a maximum of $200 per household. Mayor Taylor questioned using tourism money. Mr. Howard stated that he would have to check the details on spending tourism funds and he thought that you could use tourism money to do street scapes, but he was not sure about private property. Commissioner Hlavachick repeated that he would like to see a commitment to this.
Commissioner Graf explained a program in Hutchinson that allowed a person to rent a plot to have a garden and he was curious if the large area in Lemon’s Park could be used for anything like that. Mayor Taylor commented that it would be good use for that area. Mr. Howard stated that we could do that and that the plan had been to put in a big commons area and another area with shelters, but this could be done in the mean time. Commissioner Peltier questioned who would be in control of that. Commissioner Graf stated that what you do in your are is your business. Commissioner Nystrom suggested that you could plant fescue grass between the plots to prevent the spread of weeds. Mr. Howard commented that he would like to get more information on Hutchinson’s program. Commissioner Nystrom commented that it would take self discipline.
Ms. Garten added that the parks department had put money in capital equipment reserves to replace playground equipment in 2012.
• Pool:
Ms. Garten stated that there was an increase in this fund due to the increase in minimum wage.
Commissioner Nystrom questioned if the kiddy pools were still used. Ms. Garten stated that they were and that they stayed busy. Commissioner Peltier asked what the pool manager got paid. Ms. Garten stated that she thought it was around $10 per hour. Mr. Howard stated that the manager and life guards were worth it due to the liability issues they can face.
• Municipal Building:
Ms. Garten stated that this fund was where the utilities and supplies were paid out of for the Municipal Building and the Community Center and a transfer to capital equipment for renovations down the road.
Commissioner Nystrom commented that it looks as though we are going to keep this building. Mr. Howard explained that there was a plan, not a plan of the City’s, which was that the Parrish Hotel and the Municipal Building could be made into a fitness center with an indoor pool separating them. Mr. Howard commented that after reviewing the cost of doing that, the project was not going to happen.
Mr. Howard stated that there had been discussion by the Blythe Foundation that if the school would donate the parking lot on Fifth Street and the foundation purchased the houses east of the parking lot, they would build a recreation center with basketball courts, etc. Mayor Taylor added that it would be a large metal building with three courts. Commissioner Hlavachick asked if there would be an indoor pool. Mayor Taylor stated that there would not be. Commissioner Nystrom asked if the foundation would also be removing the structures. Mr. Howard stated that he was sure about them buying the houses, but he was not sure about the removal. Mr. Howard commented that the County had agreed to take the materials, but not tearing down. Mr. Howard stated that he had not indicated that we would tear them down and that he would bring that before the Commission for their approval. Mr. Howard added that they would probably want that portion of Iuka Street vacated.
Commissioner Peltier commented that the foundation did not have enough money to do this project. Mr. Howard commented that they have had donations. Mayor Taylor commented that that had been a bad area of town anyway.
Commissioner Nystrom returned to the Municipal Building and the money that we keep pumping into it. Mr. Howard stated that we do not make any money on it, but we have community interest. Commissioner Nystrom asked what we would do if the recreation department is moved to the fire station, what do we do then. Mayor Taylor commented that we would not have to heat and cool it as much and that we could lower the ceilings. Commissioner Nystrom stated that we were heating and cooling the building for four people. Mr. Howard stated that there had been discussion on separating the heating and cooling in the recreation area so that you would not be doing the entire building. Commissioner Nystrom predicted that there would be a 90% drop in use when the new building is built. Mayor Taylor stated that there would still be people who want to use the Municipal Building.
Commissioner Graf stated that it should be opened up to weddings and dances. Ms. Garten commented that no alcohol is allowed in there. Commissioner Graf commented that maybe that needs to be changed and that the Knights of Columbus is booked all the time. Commissioner Graf added that after visiting with an ABC representative, he found out that you can only rent to members if alcohol is allowed. City Attorney Van Blaricum commented that he would research the ABC laws , but he thought there should be a way to do that. Mayor Taylor stated that if alcohol was allowed, we would want to charge a larger deposit.
• Recreation:
Ms. Garten stated that the recreation department had no changes.
• Public Works:
Ms. Garten stated that there were no changes in this fund and it had even been trimmed a little bit.
• Maintenance:
Ms. Garten stated that this was the fund for the Municipal Building and Community Center maintenance.
• Cemetery and Special Streets:
Ms. Garten stated that the cemetery and special street salaries come out of the general fund.
• Special Police:
Ms. Garten stated that this fund was for assistance if there was anything that the police department needed.
• Industrial Development:
Ms. Garten stated that this was where the $15,000 quarterly payment for Economic Development was paid from. Ms. Garten commented that we give the $60,000 and the City Manager has $20,000 that is used at his discretion.
• Transfers:
Ms. Garten stated that the 4999 was where the payment for the Teen Center, Red Cross, ABC Pregnancy Center, and the Food Bank are made from.
Special Revenue:
• Library:
Ms. Garten commented that this was where the 3 mill for the library is at.
• Cemetery:
Ms. Garten stated that this was the operations budget for the cemetery and there had been no changes to that fund.
• Noxious Weeds:
Commissioner Nystrom asked what noxious weeds were for. Ms. Garten stated that this fund pays for spraying for mosquitoes and weeds. Mr. Howard added that this was for weeds in the streets and parking lots. Commissioner Nystrom asked if the City takes care of Main Street. Mr. Howard stated that the cracks in the sidewalk are done by the City, but some businesses do it. Commissioner Nystrom asked if that was a safety issue. Mr. Howard commented that they do it on their own. Commissioner Nystrom commented that the City should have control over the chemicals that are used. Mayor Taylor stated that he had sprayed his own after walking one evening and noticed the weeds by the Municipal Building. Mr. Howard commented that some home owners spray the street in front of their houses.
Commissioner Nystrom asked if we had sprayed for weeds. Ms. Garten stated that we had and it had made a difference. Mr. Howard added that we try to time it around the rain and that we do a big spraying after the rainy season.
• Tort Liability:
Ms. Garten stated that this fund was used in the case of a lawsuit and there is a reserve balance.
• Special Streets:
Ms. Garten stated that this was where the ¼ cent sales tax was along with the City/County highway funds that are used for street maintenance and curb projects.
• Environmental Services:
Ms. Garten stated that this fund had been closed, but left in here for the history.
• Convention and Tourism:
Ms. Garten stated that this had been talked about earlier. Ms. Garten commented that by reviewing the revenues, you can see how the reserve has been built up. Mayor Taylor questioned if we were projecting $514,000. Ms. Garten stated that we were projecting $204,000, but the balance in the cash reserves is $310,000, so your total balance is $514,000. Ms. Garten stated that the opening of Comfort Suites had helped this, but we do not know what will happen with the economy situation.
Mr. Howard commented that the rooms at the Comfort Suites are more expensive, but they are full a lot. Mr. Howard stated that two-thirds of the weekends in the summer, the hotels in Pratt are full. Commissioner Nystrom commented that when he brings in a contractor, they cannot get a room. Mr. Howard commented that we get sales tax off of that also. Mr. Howard stated that you cannot beat the revenue generated by your hotels and restaurants.
• Alcohol and Drug Safety:
Ms. Garten stated that this fund was budgeted to close in 2010. Ms. Garten explained that the State no longer accesses the alcohol and drug fee so there is no longer any revenue coming in.
• Fire Fighting Equipment:
Ms. Garten stated that this was a tax levied fund of one mill used for that purpose and that we transfer from this fund to pay for the fire truck and other equipment.
• Special Police:
Ms. Garten stated that this was where we maintain the vehicle fees and forfeiture funds. Ms. Garten stated that there is a good reserve in there and that they can pay for anything police related. Mayor Taylor commented that we have about $304,000 in that fund. Ms. Garten stated that was correct and that is restricted on what it can be used for. Mr. Howard commented that the forfeiture funds had been used to pay for part of the mapping system. Mayor Taylor added that it also paid for the laptops in their vehicles. Mr. Howard explained that you cannot budget this money.
• Risk Management:
Ms. Garten stated that this fund had been closed as it was used like the tort liability fund.
• Employee Health Insurance:
Ms.. Garten stated that this fund was established for self-funding and has not been used for two years and will be closed in 2010 into the general fund.
• Bond and Interest:
Ms. Garten stated that this was where our bond and interest payments for GO bonds are paid and it is a tax levied fund.
• Special Parks and Recreation:
Ms. Garten stated that this fund was State mandated and the liquor tax goes into that. Ms. Garten stated that this has to be split three ways with a third going to parks, a third going to the general fund and a third going to a chemical dependency program.
• Special Alcohol:
Ms. Garten stated that this was the third that we pay out to a chemical dependency program. Ms. Garten explained that there was a threat that we would lose that due to the State budget cuts, but we are still getting it and they have dropped it. Mayor Taylor commented that he could see that being a real problem. City Attorney Van Blaricum commented that the State authorized a program for special alcohol counseling and it was free, but he would not be surprised if we lose that.
Enterprise Funds:
• Electric Department:
Ms. Garten stated that this was left the same as last year. Mayor Taylor questioned that we have $4,848,000 in cash carryover. Ms. Garten stated that that was correct. Mayor Taylor commented that this was where the $2,000,000 we made came from. Ms. Garten stated that was also correct. Mr. Howard commented that part of that was the first full year that we operated under the EMP2 agreement where we buy from Jeffries, buying from a pool or generating for ourselves. Mr. Howard stated that in 2006 and part of 2007 Aquila tried to boost revenues off of this part of the sale and they took advantage of the Cities. Mr. Howard commented that when we went into the EMP2, the revenues we are making are accumulated by how we make the fuel adjustments.
Mr. Howard explained that a fuel adjustment was whatever you pay for gas, coal or other source used to generate electricity and you charge an extra charge for that. Mr. Howard explained that when we were under the KCC’s jurisdiction, we had to pay that all back in that same year, but we got ourselves removed from the KCC jurisdiction at their encouragement. Mr. Howard stated that in 2008 we got conservative with the fuel adjustment not knowing how things were going to work. Mr. Howard added that this year we cut the fuel adjustment in half and he did not anticipate generating revenues like that next year. Mayor Taylor questioned the $1.8 million shortfall between 2008 and 2009. Ms. Garten stated that some of that was transferred over to reserves purposely for special projects. Ms. Garten added that we budget to use it, but do not always spend it. Ms. Garten stated that we budgeted last year to have a loose, but we came out ahead due to not spending all of it. Ms. Garten commented that we had transferred $685,000 to the general funds.
Ms. Garten stated that you also have the debt service account that is used to pay the electric revenue bond. Ms. Garten added that we also have a contingency in there of $50,000. Mayor Taylor asked if this was the only fund we transfer to the general fund. Ms. Garten stated that we also transfer $50,000 from sanitation.
Commissioner Peltier questioned if there was $53,000 in utility bills that were not paid. Ms. Garten stated that was correct. Mr. Howard stated that the collection efforts have improved.
• Sanitation:
Ms. Garten stated that this fund was the same and it was for operations and maintenance. Mr. Howard commented that it had been suggested to him to do the clean up week again, but that week usually turned into six weeks or more. Commissioner Peliter questioned if the landfill would waive the landfill fees if it was taken out there personally. Mayor Taylor commented that they used to.
Ms. Garten commented that the landfill charges were $350,000, which was up due to the 10% increase. Commissioner Nystrom commented that he thought in another year, we would not be doing trash. Commissioner Graf asked if it would be cheaper to go to a private company. Mr. Howard stated that it would be cheaper for the City, but not for residents. Mr. Howard commented that he has been told that we are too cheap, but we are not looking at generating revenue. Mr. Howard commented that the injuries in that department would make it worth looking into a private company and keep a couple of trucks for special events that we would do the pickup. Commissioner Nystrom commented that when Mr. Phil Harmon retires might be a good time to look at it further. Commissioner Nystrom added that the building was in bad shape. Mr. Howard stated that it was and that was an example of a fund that does not generate enough revenue to keep the building up. Commissioner Nystrom commented that having a private company would also prevent the wear and tear of the alleys. Mr. Howard commented that the City could charge the private company a 5% franchise fee.
• Wastewater Treatment Plant:
Ms. Garten stated that this fund had budgeted two motor lift stations for the airport. Mr. Howard added that they were the lagoons east of the highway. Commissioner Nystrom questioned if all the maintenance at the airport was the City’s responsibility. Mr. Howard stated that it was.
• Water:
Ms. Garten stated that the question in this fund was how long the Ethanol payment would continue and that they had set the budget to reflect that they will. Mayor Taylor questioned what we would do if they did quit making those payments. Mr. Howard stated that we would have to service the debt. Ms. Garten stated that we would not have as much revenue in the water fund and look at additional revenue sources from transferred funds. Commissioner Nystrom questioned what their payment was. Ms. Garten stated that it was $14,389.
Mr. Howard stated that one of the things he would do to negotiate with them to keep the payments going would be to remind them that we gave them a good deal on water. Mr. Howard stated that he has visited with their attorneys and that if they want us to cancel the agreement, whoever they sale the plant to will be paying triple the cost for water.
Mr. Howard explained that the contract included the Frisbie well and we do not have ownership. Mr. Howard commented that if they ever wanted future water needs, then they were responsible for developing that well into a municipal well to pump into our system on their dime. Mr. Howard stated that he had a proposal in mind and shared that with the Commission.
• Utility Deposits:
Ms. Garten stated that this fund was where we maintain the deposits on utilities.
• Utility Receipts:
Ms. Garten stated that this fund recorded the long and short on utility receipts.
• Agency Funds:
Ms. Garten stated that we have four agency funds that we collect money on such as the trust funds in the Cemetery and Parks.
• Recreation Trust:
Ms. Garten stated that this was gate receipts and donations to the recreation and those funds are managed through here.
Reserve Fund:
• Water Bond Reserves:
Ms. Garten stated that this fund was required by the bond instrument that would pay a portion of the bond back. Mayor Taylor questioned what that portion was. Ms. Garten stated that it was one principal payment plus one-half of next year’s interest.
• Water Bond Interest:
Ms, Garten stated that this was where we pay for the revenue water bond payment. Ms. Garten explained that this was transfer out of the water fund into this one.
• Electric Debt Service:
Ms. Garten stated that his was the same type of fund and that there is a transfer from the electric fund into this fund to pay the electric utility revenue bond.
• Wastewater & Water Reserves:
Ms. Garten stated that these are required by the bond issue.
• Capital Equipment Reserves:
Ms/ Garten stated that this fund was where all the departments transfer money for major purchases.
• Special Street Reserves:
Ms. Garten stated that this was where the funds were to work on Main Street and to do big projects. Ms. Garten added that this was also where the preliminary engineering costs were paid from. Mayor Taylor questioned the unencumbered cash. Ms. Garten explained that this comes from the general fund and money is put back for several years for a major purchase, such as the $300,000 put back for the Main Street project. Ms. Garten added that KLINK money and geo improvement money goes in here.
• Capital Improvement Reserves:
Ms. Garten stated that this fund works like the capital equipment reserves and the boaring of Main Street water line will be coming out of this.
• Electric Maintenance Reserves:
Ms. Garten stated that this is in case there is a large claim and we pay a portion of the insurance deductable out of here.
• Fire Fighting Equipment Reserves:
Ms. Garten stated that this fund is where the lease/purchase agreement is paid from and also improvements for the fire station.
Riney money, etc.:
Commissioner Nystrom questioned where the Riney money was. Ms. Garten stated that it was in Parks and Recreation trust fund. Commissioner Peltier asked how much money we have for all our various projects such as the fire station and street fund. Mayor Taylor asked if he wanted to know our bond indebtness and everything. Commissioner Peltier commented that just the money we have in various funds for projects. Ms. Garten stated that you have to have it that way and the auditors said our total cash was about $20 million. Commissioner Peltier asked if we were moving it around. Ms. Garten stated that most of ours is in CD’s. Ms. Garten explained that the banks work well with us to get us the best rates and it is at 1.3% now.
Discussion Topics:
Sunflower H2O funding:
City Manager Howard stated that the City needs to look at other sources to get water from in the future such as the 800 acre feet dedicated to the Ethanol Plant and the Frisbie well. Mr. Howard commented that other communities do not have water, but we do and that we would be looking at Sunflower’s projects for other purposes. Mayor Taylor commented that with $57,500 we could hire our own engineers. Commissioner Graf commented that he was confused as to what they thought their next step would be and we would not be sure what our money would be investing in. Mayor Taylor commented that they probably need to do more studies so they would need even more money down the road. Mr. Howard stated that he had not thought they had done a worthwhile presentation since this project started. Commissioner Graf commented that they could not promise that our money was going to buy anything. Mr. Howard commented that there are communities that need water and are not participating, so why should we.
Mayor Taylor asked if there was a motion on supporting Phase 2 of the water study. Due to lack of a motion, there will be no funding from the City of Pratt for Phase 2 of the water study.
Steam plant:
Mr. Howard stated that there was a big decision to be made about the steam plant and replacing the cooling tower. Mr. Howard stated that the cost of a new cooling tower would be about half a million dollars. Mayor Taylor commented that you cannot run the steam plant without it. Mr. Howard stated that you cannot run at full capacity without it. Mr. Howard explained that we could crank it up to 14 mgs, but Mr. Ernie Smith, power plant superintendent, said that we may get 7 mgs. Commissioner Peltier asked what 7 mgs gets us. Mr. Howard stated that it was about a third of our load. Mayor Taylor commented that on a hot day we probably use 23 mgs.
Mr. Howard explained that we were a partial requirement City, which means that you generate your load or part of the load and you have to be able to produce 112% of the peak load. Mr. Howard stated that if you are not a partial requirement City, you have to be a full requirement City and you have to get firm electricity. Mr. Howard explained that our less than 9 mgs is called a firm contract, which you can use for your capacity requirements.
Mr. Howard explained to the Commission that there is a MKEC Unit demand charge on our bill from KMEA and the copy of the bill in front of them has that charge at $203,000 for less than 9 mgs. Mr. Howard stated that we pay that demand charge every month whether we use it or not and that is a big part of our electric bill as the actual price of electricity. Mr. Howard commented that generation, even when we are not running, is worth something. Mr. Howard stated that if we keep our generation up to 112% of our load, we can support ourselves with our own generation.
Mr. Howard explained that if you take this price that comes down to $22,583 per mg, take the generation of an additional 7 mgs of the steam plant per month, you are talking about $2,000,000 a year. Mr. Howard commented that if you replace that generation with firm power, we would not be a partial requirement city, but a full requirement City. Mr. Howard stated that if you replace firm power with generation not doing anything, we make or save money. Mr. Howard stated that you have the capabilities of generating your own load. Mr. Howard explained that we are getting a good price from Jeffries and that it is the transmission and demand charges that are high. Mr. Howard commented that if you buy off of the schedule c market, your demand charges are less but your electricity is a little higher. Mr. Howard stated that if we are generating we are paying 5 ½ cents for electricity, but our demand charge is far less. Mr. Howard commented that we are better off being able to buy off the market than having that firm generation. Mr. Howard stated that we need to rebuild the cooling tower at the steam plant to remain a partial requirement City, which is what we want to do.
Mr. Howard commented that the chances of us ever running either steam unit, unless it is an emergency, probably would not happen unless the price of gas drops down to a $1 or $1.50 per mcf. Mr. Howard stated that the City either needs to keep the steam plant up and running or abandon the steam plant and look at funding new generators. Mr. Howard stated that the best option would be to keep the steam plant and bring it up to compliance and fire it up every three years to keep it in compliance. Mayor Taylor asked when we were to do that. Mr. Howard stated that it was supposed to be this summer, but since we have had the problems with #7, it was put off until next year. Mayor Taylor commented that we have to have the cooling towers up. Mr. Howard stated that we could run the steam plant with the one tower, but we would only get what we are getting out of one of the generators. Mr. Howard stated that to be in compliance, you have to be in a stress condition.
Mr. Howard commented that now that the Holcomb plant is not going to be built, Sunflower and some other generators are short of capacity. Mr. Howard stated that the capacity of that plant is valuable and we have not dedicated our capacity to anyone. Mr. Howard explained that we want to dedicate this capacity on our own instead of using an agent. Mr. Howard informed the Commission that we had to run for Sunflower for a day three weeks ago and they paid us $20,000. Mayor Taylor questioned if that was $20,000 profit. Mr. Howard stated that you have to subtract the gas prices from that.
Mr. Howard stated that his recommendation was to fix the steam plant and that that saves us a lot of money even if it is just sitting there. Mr. Howard explained how the cooling towers operate and that the steam plant was for emergencies.
Mr. Howard stated that if the economic issues are not worked out, we could face a recession and that is why you want to run the City like a business. Mr. Howard commented that we need to decide if we want to become a full requirement City and we would be talking about significant money. Mayor Taylor questioned what the life of the cooling tower was. Mr. Howard stated that it was about twenty to thirty years and that this one is about twenty-five years old. Mayor Taylor asked what a steam engine would cost now. Mr. Howard stated that the turbine would be about $19 million and that would replace 5 & 14. Commissioner Hlavachick commented that no one thought we should buy the portable generator and we used it right off, so it is better to have it than not and that is how we need to look at the power plant. Mayor Taylor stated that we need to do it. Mr. Howard commented that he would get bids out.
Mayor Taylor questioned how long it takes to get the tower up. Mr. Howard stated that it should be early next year. Ms. Garten commented that we had been saving up for this for quite some time.
Maple Street project:
City Manager Howard discussed the Maple Street project and showed the Commission a power point map of the area. Mr. Howard commented that we had or are in the process of purchasing the property from Mr. Kenny Gates and Mr. Blake Himmelwright. Mr. Howard stated that he had asked Mr. Alan Luttrell of EBH Engineering to do a preliminary survey for putting in the street. Mr. Van Blaricum, City Attorney, stated that the property was in the hands of the abstract company and they should be closing in a week or two. Mr. Howard stated that he was recommending plating Maple Street. Mr. Howard explained that to get anyone in town, you have to have the area platted. Commissioner Nystrom questioned what the cost of the Maple Street extension was. Ms. Garten stated that it was about $1.2 million. Commissioner Peltier commented that the biggest expense were the roads. Ms. Garten added that the total cost of the project would be about $3 ½ million.
Commissioner Peltier commented that the biggest expense is not platting and asked how they were going to be sold. Mr. Howard stated that the cost would be incurred by the City to plat and that somebody has to do that. Mayor Taylor commented that he was starting to have cold feet about the project. Commissioner Hlavachick asked if he meant the whole project. Mayor Taylor stated that he was in favor of the street extension. Mayor Taylor added that $1.2 million is a lot to spend all at once not knowing if things are going to bottom out and that there were already a lot of houses on the market that are not selling.
Mayor Taylor asked if the $1.2 million was in the budget. Ms. Garten stated that it was not. Mayor Taylor questioned how this was going to be funded. Mr. Howard stated that there are cash reserves over two years and it would be the same way we are doing the Main Street project. Mr. Howard explained that the water and wastewater would be contracted out and the electrical would be done by the City with money in contingencies to do the infrastructure.
Mayor Taylor questioned why we could not do it in three years instead of two if it was not already worked in. Commissioner Graf commented that he hated to do something like this with all the layoffs and it could cause a mess. Mr. Howard stated that this was why we brought this up for discussion.
Commissioner Graf asked how much land we had purchased. Mr. Howard stated that it was forty acres. Commissioner Peltier commented that there are twenty-three acres that are developable and twenty acres of creek, but we would get our money back from the sale of the lots and the electricity. Commissioner Graf commented that you have to sell them first. Mayor Taylor commented that you have to build the road first.
Mr. Howard pointed out the area that the church has already approached the City about and wanted to purchase. Mayor Taylor asked what a lot would go for if it was developed. Mr. Howard stated that you have to plat Maple Street first. Mr. Howard commented that this was part of economic development to have a place for people to go and have it site ready.
Mr. Howard stated that the area north of the Green Sports Complex could be developed into a high density apartment building and it was not unwise to have those areas platted and ready to go. Mr. Howard stated that platting Maple Street was a small cost to this. Commissioner Nystrom commented that he is one who puts his money where his mouth is and you have to invest in the community. Commissioner Nystrom added that this would be a wise investment.
Commissioner Peltier commented that we need to get it plotted and get the street in. Mayor Taylor stated that he wanted to wait until 2011. Commissioner Nystrom stated that it will never be cheaper to do it. Mayor Taylor commented that we do this the same as we did Main Street. Mayor Taylor commented that he got calls thanking him for not voting for the Maple Street project and he also got comments that it was a bad idea to reject it. Mayor Taylor clarified that he was not against the project, he just wanted to wait. Commissioner Nystrom commented that a lot of people want us to do it. Mayor Taylor commented that we need to do it eventually, but just not right now.
Mr. Howard stated that the sequence should be to get it platted and plotted, because you cannot build a house without Maple Street being there. Commissioner Nystrom questioned getting it graded and able to drive on. Mayor Taylor stated that he liked that idea, then in 2011 we would have the money set aside to finish it. Mr. Howard commented that it would be a good addition to the City once the bypass is built.
Mr. Howard questioned Mayor Taylor about getting it platted and plotted. Mayor Taylor stated that he did not have a problem with that and asked what the cost of that would be. Mr. Howard stated that it would be less than $10,000.
Commissioner Graf asked who would be doing the development. Mr. Howard commented that the City was going to do that initially. Mayor Taylor stated that he was not in favor of that. Mr. Howard stated that we would own the lots and utilities and when the lots sold, the money would go to reimburse the City for the cost of the project. Commissioner Peltier asked if we would have to put in a bridge. Mr. Howard commented that there would be a low water crossing marker, because it could be a traffic safety issue.
A motion by Commissioner Peltier to plat the big lot on the new property for Maple Street project. The motion was seconded by Commissioner Hlavachick. Mayor Taylor questioned that we were only talking about a cost of $10,000 for the plat. Mr. Howard stated that he would get back to them with a figure. The motion passed with four approved votes and one no vote by Commissioner Graf.
Industrial Park:
Mr. Howard stated that Phase 2 of the Industrial Park was on hold, because Mr. Terry Richardson had backed out of the property he was going to purchase due to economic issues. Mr. Howard commented that there were still three lots now that could be sold, so plating of the east half of the Industrial Park was not as pressing. Mayor Taylor asked if the Industrial Park was eight acres. Mr. Howard stated that there were eighty total acres, but we will need to plat the last forty eventually. Mr. Howard added that it is important to have those lots.
Local bidding process:
Ms. Garten stated that another topic for discussion is the local bidding process and how to define it. Mayor Taylor stated that local is definitely the City of Pratt and anyone who pays Pratt property taxes and that includes the airport and Industrial Park.
Commissioner Peltier asked where we draw the line on the dollar amount. Mayor Taylor stated that a $100,000 job would be $5,000. Commissioner Peltier questioned if we want to do the 5% on material only. Mayor Taylor commented that that would change their way of bidding.
Mayor Taylor commented that he would not have voted for Mansel Construction to do the fire station. Commissioner Peltier commented that they buy their trucks here in Pratt. Mayor Taylor commented that they do not live in Pratt County and he would have looked at that if he had been at the meeting.
Commissioner Peltier asked if we wanted to put a cap of $100,000 on the 5%, but added that that could cause other issues. Commissioner Peltier questioned if we advertise that 5% in our bids. Mayor Taylor stated that we do not. Commissioner Nystrom commented that the salesman from Medicine Lodge at the last meeting stated that he had been cut out of a deal because he was from Medicine Lodge. Mayor Taylor commented that you can lose a bid over a local regardless if it is the low bid. Commissioner Nystrom stated that he felt neither one lived in Pratt and that Kessler Construction’s tax money was not going to the fire station. Mayor Taylor commented that he was the local bidder, because he lived in Pratt County. Mayor Taylor added that $750 is a close bid, but Mr. Kessler helps us as a tax payer in Pratt County and so he felt that he was more local. Commissioner Peltier stated that if the first local s\is the City and the second is Pratt County, we need to state that somehow. Commissioner Nystrom commented that we send it out with the bid. Commissioner Hlavachick commented that we can give to another bidder even with the 5%. Mayor Taylor commented that they get 5%, because their money stays local.
Mr. Howard commented that we need to amend the Resolution to get this definition in place. City Attorney Ken Van Blaricum stated that he would get that amended and bring it back to the Commission. Mayor Taylor asked that Mr. Van Blaricum use good words while doing this.
Utility rates:
Mayor Taylor questioned if there was any way to give citizen a break on our utility rates. Mr. Howard stated that the bills from last year at this time were higher than they are this year. Mr. Howard explained that it was because of the lower electrical costs and not because of lower rates. Mayor Taylor asked if it cost less per kilowatt. Mr. Howard stated that we are cutting costs to buy electricity and that is reflected on the customers. Mr. Howard commented that we may be a little high on the electric, but we are not on the water and sewer, so if we cut the electric rates, we would have to raise the water and wastewater.
Mr. Howard commented that to lower the rates, we would have to amend the ordinance and right now, the rate depends on how much you use. Mr. Howard added that it is best to let inflation take care of it. Mayor Taylor questioned cutting it a ½ cent per kwh. Mr. Howard explained that you do not want to get yourself in a situation where you have to raise it a lot down the road. Mr. Howard added that you want to be careful when collecting revenue.
Commissioner Peltier asked about the fuel adjustment and when fuel goes up, the electric bills go down. Mr. Howard explained that we were not averaging the fuel adjustment this year. Mr. Howard stated that with the revenue brought in last year, we do not need the revenue in electrical this year and should come out about even at the end of the year. Mr. Howard commented that it was good to have the reserves that we have, because if the economy goes down, the amount of people that cannot pay would get worse and so would that debt.
Mr. Howard asked if we cut the rates, are we going to have to cut our service. Mr. Howard explained that we trim trees that are not ours and do things for people that are customer service related. Mr. Howard stated that after we strengthen our system and have it up to par, then we could look at reducing the rates in a few years.
Ms. Garten stated that through the FEMA mediation, the City has twelve projects going from the ice storm. Mr. Howard commented that some of these were before we knew that FEMA was going to reimburse us.
Mayor Taylor questioned if we had moved that meter to the road for Mr. Loren Barker. Mr. Howard stated that he had called Mr. Kelly Hemphill, Director of Electric Utilities, and said that the trees had been trimmed back, but Mr. Hemphill stated that they were not done enough. Mr. Howard commented that he was not sure if they had moved the meter, but he would check.
Mr. Howard commented that there were changing times with electrical issues and if stability would happen, it would be easier to do things. Commissioner Peltier commented that energy was an international issue that we have no control over. Mr. Howard commented that we control what we can. Mr. Howard stated that BP Energy had leased a lot of ground for wind generation, but you look at Boone who backed out and you have to wonder. Mayor Taylor commented that there have been a lot of calm days lately. Mr. Howard stated that wind generation comes on line when you do not need it and off when you do.
Publication:
Ms. Garten commented that she would have the sheets for publication at the next meeting. Mayor Taylor asked when we do the report and how much time we have. Ms. Garten stated that you have to publish ten days before the public hearing and to the County Clerk by the 25th of August, so we would publish by the 5th. Mayor Taylor commented that he would like to see us drop one mill more or about $40,000. Commissioner Peltier asked why. Commissioner Nystrom commented that we are not raising the burden on the City. Commissioner Nystrom stated that he felt we had done the best we could do for Pratt. Commissioner Hlavachick stated that he thought we had done a great job.
Mayor Taylor thanked the Commission for going into the land a little slower on Maple Street.
Commissioner Peltier asked if they were going to leave in the 3% increase for personnel. Commissioner Hlavachick stated that it should be left in.
EXECUTIVE SESSION:
A motion by Mayor Taylor to go into executive session for thirty minutes to discuss non-elective personnel at the request of Commissioner Graf and City Manager Howard. The motion was seconded by Commissioner Hlavachick and approved unanimously.
A motion by Mayor Taylor to return from executive session with nothing to report. The motion was seconded by Commissioner Hlavachick and carried unanimously.
ADJOURN:
A motion by Commissioner Hlavachick to adjourn. The motion was seconded by Commissioner Peltier and carried unanimously.
_____________________________________
JEFF TAYLOR, Mayor
(SEAL)
ATTEST:
_____________________________________
LUANN KRAMER, City Clerk
JULY 13, 2009
The Governing Body of the City of Pratt met in recessed session in the Commission Room located in City Hall.
PRESENT: Jeff Taylor Mayor
Bill Hlavachick Commissioner
Eric Nystrom Commissioner
Willy Peltier Commissioner
Victor Graf Commissioner
ALSO PRESENT: Dave Howard City Manager
LuAnn Kramer City Clerk
Ken Van Blaricum City Attorney
Diana Garten Finance Director
CALL TO ORDER:
Mayor Taylor called the recessed meeting of July 06, 2009 to order. The Mayor instructed the Clerk to note that all Commissioners were present.
BUSINESS:
2010 BUDGET SESSION:
Finance Director Diana Garten commented that the process for getting the budget ready was to get the departments their worksheets in May and they have a month to put together their proposed budget. Ms. Garten stated that most of the departments were able to maintain their budgets this year and some had even trimmed theirs. Ms. Garten informed the Commission that the total budget for 2010 for the City of Pratt was $28,000,000. Ms. Garten stated that that was up from $27,900,000 over last year due to capital projects, engineering costs and proposed labor costs implemented in the 2010 budget.
• BUDGET HIGHLIGHTS
Labor Costs:
Ms. Garten stated that the 2010 budget includes a three percent (3%) cost of living increase that amounts to $85,000 total. Ms. Garten explained that is being doing due to the elimination of vacant positions. Mayor Taylor asked about the vacant position in electric production. City Manager Howard stated that things have changed from running the steam plant all summer and that employees have quit and we have not filled those positions. Mr. Howard added that those positions have been budgeted until this year and the odds of going to running the steam plant through the summer would not happen. Mr. Howard stated that there were some issues that needed to be decided on the steam plant, but only if we were knocked off the grid in the summer would we need the steam plant.
Mr. Howard explained that when Aquila canceled our contract we covered that need through a firm contract with Jeffries and it was cheaper than the steam plant. Commissioner Hlavachick asked how much we were in for with Sunflower Electric. Mr. Howard answered that the EMP verbally spoke that we would want 40 megs of ownership, with Pratt having eight or nine megs. Mr. Howard explained that his thoughts are that we are not sure where the electrical industry is going to go with the economic down turn, but there is available electricity, which keeps the cost down. Mr. Howard commented that wind generation cannot compete, because electricity is too cheap and the price of nuclear and coal would have to go up to make green energies compatible. Mr. Howard commented that government will have socialized the cost no matter where you get your electricity. Mr. Howard stated that if we have a severe economic downturn, raising everybody’s overhead cost, which next to labor are utilities, would be detrimental to expanding businesses.
Mr. Howard explained that Holcomb was one of those things and that they have to resubmit for their permit. Mr. Howard commented that what happened with Sunflower was that they did not approve their old permit and now they have to resubmit a new permit for approval. Mr. Howard explained that they were going to be sued by the Sierra Club and the State, so the Holcomb plant could be years out in his opinion.
Mr. Howard stated that this was justifying the three percent (3%) raise. Mr. Howard commented that the economy is not showing in the sales tax figures, but we are flat lining a little bit and we do not know how far it will go. Mr. Howard stated that the employees are a big part of what happens in the City and we have good department heads and we need to take care of their needs is important Mayor Taylor commented that Hutchinson had taken it on the chin this year, but they rely on tourism and people coming in. Mr. Howard commented that Pratt is the foundation for government hubs such as KDOT and Wildlife and Parks, along with the City, County, hospital, college and USD’s. Commissioner Nystrom stated that 66% of people in Pratt are government employees. Mr. Howard stated that we have also helped ourselves by promoting tourism with whatever happens to be going on such as hunting in the fall, Lemon Park Lights, Miss Kansas and ball tournaments. Mr. Howard added that it was just not highway traffic that we can take advantage of the lodging tax. Mr. Howard commented that there is a lot of land that has been leased in this area for wind farms, whether they get built or not is questionable, but we are the energy hub here in Pratt. Mr. Howard added that agriculture is as big as it ever was and our economy is pretty diversified. Mr. Howard stated that he was not sure why we were not falling off as much as some communities. Mr. Howard stated that we may not generate the sales tax that we had been, but the budget has always been conservative with projecting that, because it can fall quickly.
Commissioner Nystrom questioned if we were going to be able to do the three percent (3%) if the cost of living is not positive. Ms. Garten stated that that was basically terminology. Commissioner Nystrom commented that he had always been a major advocate for the City, but we have a lot of people out there that are hurting. Ms. Garten stated that that was why we were trying to justify the funding of it by the cuts. Mr. Howard added that we were sensitive to that. Commissioner Nystrom stated that he was not against the merit raises or adjustments, but he was just concerned. Mr. Howard stated that it was in the budget, because we can afford it and we want to take care of the employees. Mr. Howard added that he knows that not everybody in the community is going to give their employees a raise this year and he knows what is happening at the hospital and the school systems. Commissioner Nystrom commented that they are all taking sacrifices and that State workers are taking mandatory leave. Mr. Howard stated that this may not go over well, but it reflects that the City has been taking care of itself. Commissioner Nystrom stated that it is on the shoulders of the tax payer. Mr. Howard stated that we try to minimize that as much as we can. Mr. Howard added that it was in the budget, but it was not going to be approved today so the Commission has time to think about it. Mr. Howard commented that it has never happened, but we could always meet again to discuss issues before the public hearing on August 17th. Commissioner Nystrom stated that this was something to think about, because there are people out there that are hurting. Mayor Taylor added that that was something that we need to look at this year.
Commissioner Nystrom commented that with the proposed decrease in the mill levy, we are still taking another out of the tax payer and it is not a balanced budget. Ms. Garten stated that tax levy was up about $39,000 and that was based on increased valuations. Commissioner Nystrom stated that to get it down to a truly flat levy, we would have to take it down to forty-two. Mr. Howard commented that he was hesitant to do that and that the mill levy has not gone up since he had been here except for one year. Mr. Howard added that the worst thing you can do is to cut it and then have to go back and raise it. Mayor Taylor commented that we have been able to do that with the cut of the half cent sales tax. Commissioner Nystrom stated that we have lowered the mill levy, but we have not cut the tax burden. Mr. Howard commented that that was true, but we were not responsible for the additional tax burden. Commissioner Peltier stated that the school district had made those kinds of efforts during the Howard Gray era and they paid for it later. Commissioner Peltier stated that he was not for making those kinds of cuts. Mr. Howard commented that in all honesty to what Commissioner Nystrom was saying, we could make those kinds of cuts this budget, but it may down the road. Mr. Howard added that with property tax you want to be careful when you go up and when you go down. Mr. Howard explained that if you look good one year, but you have to go up the next year or two, that shows poor financial management. Ms. Garten explained that the mill levy is tied to only six of the funds and so lowering the mill levy would impact the general fund, the bond and interest fund and noxious weeds. Commissioner Nystrom commented that the mill levy was a very small part of our budget. Ms. Garten agreed. Ms. Garten added that the salary increase is across all of the enterprise funds, so that if you want to take that out and decrease your bill, it would have an impact in other areas. Commissioner Nystrom stated that we come through these budgets unscathed from the public in the past and he sensed a little more danger this year.
City Manager Howard stated that they had visited about the raise, but the City can afford it. Mr. Howard added that the perception may be that we are doing it when most other taxing entities are hurting. Mr. Howard explained that looking at information that he gets on sales tax in town, it is not showing problems. Commissioner Nystrom commented that it was like the housing bubble and someday it was going to pop. Ms. Garten stated that she had heard in the news that State wide retail sales were going to be up for the summer and that people were not cutting back as much as they had thought earlier. Mayor Taylor commented that the Wichita housing market is down and that there were a lot on the market, but not being picked up.
Commissioner Nystrom commented that we were the only community in the State of Kansas where valuations have increased and he knew that we have nothing to do with that. Mr. Howard stated that in his opinion they should not have gone up, but from his experience, Counties lag behind by three years. Commissioner Nystrom stated that every day you hear that valuations have plummeted such as in Wichita, Hutchinson and Kingman, but Pratt has had a miraculous $2 million increase. Mayor Taylor commented that you have to question if it is property valuations or an increase in new valuations. Mr. Howard stated that that was a good point as the old houses are coming off the revitalization program. Commissioner Nystrom commented that if you own property, you would think that the houses that are on the revitalization program that have depreciated would offset the new ones coming on by 100 to 1 ratio. Mayor Taylor commented that we had some increases due to Greensburg and it should not have continued to increase. Commissioner Peltier commented that our inventory is way down. Commissioner Nystrom stated that you do not sell a house today for what you could sell it for last year. Mayor Taylor commented that there are houses that are not selling.
Mayor Taylor asked if the County has to approve the appraiser’s increases. Mr. Howard stated that he thought that they did. Commissioner Peltier questioned if the State puts pressure on the appraiser also. City Attorney Ken Van Blaricum commented that he did not think that the State puts pressure on the County overall. Mayor Taylor commented that they say there are the same type of guidelines all across the State and they cannot do anything about that. Commissioner Peltier commented that it was his understanding that when Greensburg happened, everything went up and everything sold and the State looked at that and saw that the valuations had gone up. Commissioner Peltier commented that he had visited with the appraiser about that and he had said that he was appealing that to the State, but that they have some input. Commissioner Peltier added that the County cannot say that they do not want to go up. Mayor Taylor commented that they were not going to put all the responsibility on themselves and that they are going to defend their employer. Mr. Howard commented that the article on the news stated that Pratt had the highest valuations and they were questioning what was going on in Pratt and that they far exceed the normal. Mayor Taylor stated that the numbers were somewhat slanted and that there was an increase of 130%. Commissioner Nystrom agreed with the 130% as he had pulled his valuation and it was 130%. Mr. Howard commented that you have to wonder if this should be happening today with the local economy being down, but no place will be going untouched. Commissioner Nystrom commented that main street Kansas was in grave danger. Mr. Howard agreed. Commissioner Peltier questioned why Commissioner Nystrom thought that. Commissioner Nystrom stated that he knew some things and that commercial real estate space was going to come available. Mayor Taylor commented that you have to look at the plant cuts and auto dealers closing. Mayor Taylor added that Mr. Howard was correct when he stated that electricity was going to be used less and production will be down a lot. Mr. Howard agreed and added that if you go to the mall or Wal-Mart it is warmer than it used to be.
Mr. Howard informed the Commission that the new motel is still going to build. Mr. Howard commented that the Sports Complex, even with an economic downturn, many people may not be traveling this summer and stick closer to home and go to games at the Sports Complex. Mr. Howard stated that his biggest fear was losing the car dealerships and added that that would be bad.
Mayor Taylor commented that to budget gas at $4 to $5 per gal gives us a buffer. Ms. Garten stated that last year at this time gas was $4 per gal. Mr. Howard commented that if you read the national news with what is going on in the world, with any war the price of oil will go through the roof, but oil should go down if there are no other factors.
KPERS:
Ms. Garten stated that the employer’s rate for KPERS was going up to 2.71%, which was up 6.54%. Ms. Garten elaborated more on the tax levy discussed by Commissioner Nystrom and the City is levying $39,000 more in the 2010 budget, if adopted. Ms. Garten added that there are the uncontrollable costs that are increasing, such as KPERS and insurance. Ms. Garten stated that we are incurring more costs than what we are going to raise the tax levy by. Mr. Howard commented that health insurance rates were going up 9.9% this year. Commissioner Nystrom commented that he just wanted to remind everyone not to go trumpeting your horn that we lowered the mill levy. Mayor Taylor stated that we lowered the mill levy and it was the County’s valuations that went up, so we should call it as it is. Commissioner Peltier stated that the cost of doing business is going up. Mr. Howard explained that along with the 3% raise, the City is picking up the $68,500 increase in the health insurance. Commissioner Peltier commented that you could say that employees are getting a 5% raise with benefits. Mr. Howard repeated that he wants to take care of the employees and that was what he was trying to do here and he expected to be challenged. Commissioner Peltier commented that he would rather see us buy one less tractor than not take care of the employees.
Commissioner Hlavachick questioned the part-time salary in the recreation department. Mr. Howard explained that that had been over budgeted the last couple of years. Commissioner Graf questioned part-time help being paid $25,000. Mr. Howard commented that that was for a combination of part-timers such as umpires, summer help and a lot of people that are funneled in and out. Ms. Garten added that it was also diamond workers and concession stand workers.
Property and Insurance:
Ms. Garten stated that property and insurance costs had gone up this year too. Ms. Garten explained that our insurance revalued our property and it went up. Mayor Taylor questioned if this was through the County. Ms. Garten stated that our insurance company does their own. Mayor Taylor questioned if the County even valuated our property. Mr. Howard stated that they found out in Greensburg that they were not doing valuations on City and County property and they were looking back at buildings and they were worth nothing. Mr. Howard added that FEMA suggested starting to valuate City owned property.
Commissioner Nystrom questioned if we were paying boiler insurance if we were not firing up the boilers. Mr. Howard stated that it was expensive, but you cannot let that lapse. Mayor Taylor stated that if you let it lapse and had to fire it up, you could be talking millions if something went wrong. Mr. Howard commented that they do blow up on occasion. Mr. Howard commented that he would be talking about replacing the cooling tower later and that would cost about half a million dollars.
Mill levy:
Ms. Garten stated that the proposal was to reduce the mill levy by 1.2 mills. Ms. Garten commented that the valuations came in at $37,190,489, which was up $1.5 million from last year. Commissioner Hlavachick questioned what a mill was worth. Ms. Garten stated that it was worth $34,141 this year.
Fuel Costs:
Ms. Garten stated that the fuel costs were budgeted at $6 per gallon last year and we had come out ahead. Ms. Garten explained that it had been lowered this year to $5 per gallon to help out other expenditures. Ms. Garten commented that we do not know where that is going.
Street project:
Ms. Garten stated that the street project in this budget was the North Main Street project. Ms. Garten explained that she had thought that the project was to be let in December when this was put together and it still might, but it may not get done until 2010.
Engineering costs:
Ms. Garten stated that preliminary engineering costs had also been budgeted. Ms. Garten commented that she understood that we would be boaring the water line on the Main Street project in 2010 and that would be coming out of the capital improvement fund for $1 million. Ms. Garten added that that may have to be increased, because that water line is going to cost $1.2 million to $1.3 million. Mr. Howard commented that construction projects have been coming in at about 30% cheaper than they have in the last two to three years and that was an advantage to putting this project off. Mr. Howard stated that there are peaks and valleys in construction as anything else, so the price of doing a project can go down.
Mr. Howard stated that there would be a savings in cost since we are running the service lines to the buildings and even into the buildings and not tying onto a forty year old line. Mr. Howard added that if something goes wrong down the road, the City would be the one to go in and replace it. Ms. Garten stated that we also have the loan in place from Kansas Public Water Supply Loan Fund.
Mayor Taylor questioned if we were going to do the sidewalks also. Mr. Howard stated that his plan was to do the water line, then the street, then the sidewalks. Commissioner Peltier asked if they all have back doors. Mr. Howard stated that it would depend on the business. Mayor Taylor commented that it would be tough for a few businesses, because they would have to have someone back there to monitor activity. Mr. Howard commented that we will have to wait and see what shape the sidewalks are in after the street project, but that project has not been put together yet. Mayor Taylor stated that we should get rid of the trees.
Ms. Garten informed the Commission that, due to budget cuts at the State level, we lost $24,000 in 2009 in the City/County Highway funds. Ms. Garten stated that those are the funds used to fix street and curb and gutter projects along with the ¼ cent sales tax. Ms. Garten added that we did have to lower the budget for those projects in 2010. Ms. Garten commented that we also decreased the sales tax revenue by about ten percent.
Capital Outlay:
Ms. Garten stated that this was where the list of equipment the department heads are anticipating needing in 2010. Ms. Garten commented that each department has an equipment budget line item.
• City Clerk
Ms. Garten stated that the City Clerk’s budget shows that they are going to replace the Sensus Handheld devices, because they are no longer supported. Ms. Garten stated that there is no choice but to replace them.
• Pool
Commissioner Hlavachick questioned looking at the liner. Ms. Garten commented that we would be looking at that later in the discussion topics. Mayor Taylor asked if we would get by with the liner this year. Ms. Garten stated that we should and maybe a few years. Mr. Howard commented that the liner has ripped twice this year, but it was in the shallow end.
• Fire Department
Ms. Garten stated that the fire department was looking to replace their thermal image camera.
• Parks Department
Ms. Garten stated that the parks department was looking at purchasing a 300 gallon water tank as theirs is not functioning very well.
• Pool
Ms. Garten stated that the pool needs to replace the soda ash mixer and chlorinator for about $5,000. Ms. Garten commented that they have also budgeted $2,500 to get more deck chairs and that the current chairs were a positive impact at the pool. Mr. Howard commented that those came out of the travel and tourism money.
Commissioner Nystrom questioned the numbers at the pool this year. Ms. Garten stated that they were up. Commissioner Nystrom asked if the season passes were up or down. Ms. Garten stated that they stayed about the same, but the daily receipts were up. City Attorney Van Blaricum commented that the swim meets this year brought a lot of people to town.
• Recreation Department
Ms. Garten informed the Commission that the recreation department was looking to replace a pick-up.
• Maintenance Department
Ms. Garten stated that they are doing some painting and kitchen flooring at the Municipal Building
• Travel and Tourism
Ms. Garten commented that they have suggested the purchase of a kiosk directory for the Green Sports Complex. Mr. Howard added that this was something similar to what you would see in a mall and he had gotten an estimate of $60,000 for what we were wanting to do. Mr. Howard stated that this would let travelers know where to stay or eat in Pratt and it would be a good purchase. Commissioner Peltier asked if we would be able to add and subtract businesses. Mr. Howard stated that we would and that this would be at no charge to the businesses. Commissioner Nystrom asked if this was coming out of travel and tourism funds. Ms. Garten stated that it was.
Ms. Garten explained that the travel and tourism funds are the guest tax receipts from the bed tax. Ms. Garten stated that there was about $350,000 in that fund and it has increased a lot in the last couple of years. Mayor Taylor questioned what the bed tax was currently. Ms. Garten stated that it was at 7%. Commissioner Nystrom asked what the plan was for holding on to that money. Mayor Taylor commented that they are limited on what they can spend it on. Mr. Howard commented that they do buy advertising with it and signage that promote the community. Mr. Howard stated that the City gives them $70,000 a year and the majority of that is used for advertising.
Mr. Howard commented that Mr. Bob Green had visited with him in 2003 and had given the City nineteen or twenty acres east of the ball complex thinking that there could be a soccer field and track. Mr. Howard explained that this cash pool originally started with the expansion of the Sports Complex project. Mr. Howard added that the most expensive thing right now would be the kiosk.
Commissioner Graf questioned using some of that money to do something with the nativity scene that people see all the time and it was in bad shape. Commissioner Graf commented that he had visited with Chamber Director Brian Hoffman and it would cost about $7,000 to get it to where it needs to be. Mr. Howard stated that he would suggest that to them and see if tourism would pay for it. Ms. Garten reminded the Commission that they had applied for a grant and had been denied.
Mr. Howard commented that this money could actually fund the recreation department if the general fund gets pinched. Mr. Howard added that you do not want to deplete this fund though, because it can be used in other areas.
Commissioner Nystrom asked if the new owners of McDonald’s had opted to keep the advertisement at Green Sports Complex and what kind of contract did they have. Ms. Garten stated that it was paid for and that the contract was for ten years. Mr. Howard added that the previous owner paid it in full and that we were only four or five years into it.
Mayor Taylor asked what the recreation budget was. Ms. Garten stated that it was $418,000.
• Electric Production
Ms. Garten commented that the electric production was looking at purchasing drive by equipment.
• Electric Distribution
Ms. Garten stated that electric distribution had budgeted to replace their hydraulic crimper again in 2010 since it did not look like they were going to get it purchased in 2009 and a new computer.
• Water Department
Ms. Garten stated that the water department would like to replace a computer also. Ms. Garten added that they also have equipment that they buy each year for rotational upgrades to the water system.
Equipment Purchases:
• Finance Department
Ms. Garten stated that the finance department does a computer replacement on a rotational basis each year. Mayor Taylor asked if those computers go out some place else. Ms. Garten commented that they are given to the ones in most need of it and they are reformatted. Mr. Howard added that if a computer is five years or older, it would not handle the new software.
Commissioner Nystrom asked about a drop box for bill pay. City Clerk Kramer commented that we had talked about it when the post office box was being relocated and it was thought that the corner of Fourth Street and Ninnescah Street would be a good location, but nothing came of that. Commissioner Hlavachick asked about the house next door. Mr. Howard stated that they keep that rented. Commissioner Nystrom commented that he was in the office the other day on a due date and the foot traffic was unbelievable. Ms. Kramer commented that there are citizens that like to hand you their payment so that they are sure you got it.
• Parks
Ms. Garten stated that the parks department is budgeting for a replacement pick-up.
• Cemetery
Ms. Garten informed the Commission that the cemetery had put in the budget to purchase a new mower.
• Line Distribution
Ms. Garten stated that line distribution would like to purchase a new phone system in 2010 as theirs is pretty old. Ms. Garten commented that they have also budgeted for skid steer attachments and an additional 4X4 truck.
• Water Department
Ms. Garten stated that water department was budgeting for a new handhelds and AMR system that includes software.
Reserves Total:
Ms. Garten commented that we have budgeted $750,000 in capital reserves for several years. Ms. Garten stated that we do not usually spend all of it, but it gives us the budget authority in case we need to.
Old Crown Vic:
Commissioner Graf questioned what the police department was going to do with the wrecked police car that was sitting on Third Street. Mr. Howard stated that it would be auctioned off at some point. Commissioner Graf commented that it should be moved from time to time since the City has an ordinance about vehicles sitting in one place for a period of time. Mr. Howard stated that they do leave it there just in case it would be needed and that he would talk to Chief Holmes about moving it. Commissioner Graf asked if it could be put down at the park department until it is auctioned off. Mr. Howard commented that that area is more for junk and this vehicle is still operable, so we need to find another place to put it. Mayor Taylor stated that it would be nice to move it once in awhile. Mr. Howard stated that Chief Holmes budgets for two vehicles, but he is only buying one and encumbering the other one to buy the next year.
Commissioner Graf questioned how many police cars we have. Mr. Howard stated that he was not sure, but he thought around thirteen. Commissioner Graf stated that it looks funny when you have a police car sitting at houses. Commissioner Nystrom suggested that the next time any of the Commissioners are questioned about the police vehicles is that you ask them if they have been a victim of crime, do they know of any major crimes in the City and then ask what the magic number of officers is before you are a victim of crime. Commissioner Nystrom commented that the person he was talking to about this told him to forget the question. Mr. Howard stated that the logic behind officers having the vehicles parked at their homes is that it may prevent a break-in. Mr. Howard added that this also keeps the mileage down and the vehicles are kept longer. Commissioner Nystrom stated that we have the lowest crime in Pratt per capita in the United States. Mr. Howard commented that if an officer is responsible for a vehicle, they get better maintenance.
Information section:
Ms. Garten stated that the informational section showed how the City has been budgeting for the last five years in the non labor category. Ms. Garten commented that the general fund has stayed consistent and we try to maintain a minimum level. Ms. Garten added that the last four years the only increase in the general fund was about 4% and that was mainly the uncontrollable cost such as insurance and fuel. Mr. Howard stated that that was not the fault of the department heads and not caused by overspending. Mr. Howard stated that we are not spending just to be spending. Ms. Garten explained that this is the actual budgeted amount and the expenditures came in less.
Ms. Garten stated that the electric enterprise fund showed an increase in 2008/2009 when we joined the EMP2. Ms. Garten explained that we had decided that we needed budget authority in case we had to fire up and produce. Ms. Garten commented that we increased that budget with the intent that we would not spend all of it and that we would either purchase the power, produce the power and if we produced power, were going to sale it. Ms. Garten stated that if we sold it to other Cities, our revenue would also be up. Mayor Taylor questioned if that was why the revenue was always so high and comes in under budget. Ms. Garten stated that was correct and that you have to do that if you are going to budget the expenditures.
Mr. Howard commented that the big item is to have the money to purchase natural gas. Mr. Howard stated that in a later discussion, this was all going to wrap around the cooling tower. Mayor Taylor questioned where we were on our natural gas contract. Mr. Howard stated that a big part of Mr. Kenny Kreutzer’s job is to analyze the data that we get. Mr. Howard commented that Mr. Kreutzer had noticed that Russell had pre-purchased some gas on their own in May and Rainbow wanted both of us to purchase it at $3.50 per MCF. Mr. Howard stated that he did not want to do that as he thought that it would go cheaper. Mr. Howard explained that we did not purchase any and Russell did and they are now getting burned and that we are buying it $.50 to $1.00 cheaper on the daily market. Mr. Howard stated that Rainbow, who is our electrical agent and works for KMEA and serves the EMP2, had been plugging in the daily price for Russell’s gas, but KEMA was billing for the purchase price. Mr. Howard informed the Commission that we finally got through to them that we should be at the top of the generating list and we are now making about $10,000 every day that we generate instead of losing. Mr. Howard stated that this comes off of the billing from KMEA, which lessens our cost to the customers. Mr. Howard stated that the threat he made was that he would cancel the contract and he reminded the Commission that there was a 30 day out in the contract. Mr. Howard added that he would not have canceled the contract, but it did get straightened out. Mr. Howard stated that Rainbow said that they were trying to do the best thing for Russell and they were told that Pratt does not care about them and that we have to take care of ourselves.
Mayor Taylor questioned if the cost was down now. Mr. Howard explained that you can buy from three markets and the daily market is the way to go. Mr. Howard stated that the peaking power is from burning gas and our cost for generating plus 10% is five to five and a half cent range. Mr. Howard added that if this were a year ago we would have been paying $100/$150 per mega watt and now we are paying about $50 per mega watt.
Mr. Howard stated that the daily market, where you buy it a day ahead, is the way to go, and he thought we were probably buying under $3 and anything under is a steal. Mayor Taylor commented that he remembers when we used to have to lock in for a year. Mr. Howard stated that the plan is that if the future market drops to the $2/$2.20 range, we probably would purchase out to next summer, but that would take a significant fall and that could happen. Mr. Howard commented that there is a lot of gas out there and they have shut down wells because there is so much. Mr. Howard also explained that you are not going to see this on your bill because you get billed the price that they put it in storage, so that is what they sell it to you for.
Ms. Garten stated that the sanitation department showed an increase in 2009/2010 due to the landfill charges that we have had to start paying and fuel costs.
Ms. Garten stated that the wastewater department looks high in 2006 due to a restructure in the debt and that the transfer was dropped in 2008 from the general fund. Mayor Taylor questioned how much we had been transferring. Ms. Garten stated that it was $100,000 and that at that time the general fund did not need it and the wastewater fund needed buildup in reserves.
Mr. Howard commented that the biggest problem at the wastewater plant is the sludge disposal and we have talked about a belt press or some way to get out of hauling it out. Mr. Howard stated that it was cheaper to bag it and haul it to the landfill, but the cost to do that is about $2 million. Commissioner Hlavachick asked if you had to have drying fields. Mr. Howard explained that you used to, but there are other ways now.
Ms. Garten stated that the water department increase in 2008 was due to the bond payment for the Ethanol Plant and the Ethanol Plant has covered those on the revenue side. Mr. Howard commented that the Ethanol Plant is actually tied into the Sunflower H2O project and he would explain that later. Mayor Taylor questioned if we were still making the bond payment. Ms. Garten explained that we are and that we have to budget on the expense side so that we have budget authority to spend that money, but we get the revenue coming in from the Ethanol Plant.
Mayor Taylor asked if there was any word on what the Ethanol Plant was going to do. Mr. Howard stated that he had dealt with Mr. Ted Loomis when we were concerned about getting the bond payments from Gateway, but we always got them. Mr. Howard explained that Mr. Loomis was involved with the bankruptcy and he had told him that there is a financial plan in this Chapter 11 and they are working through each organization until things are settled, which could be six months to a year. Mr. Howard commented that the plant would not sell until all that is taken care of. Mr. Howard stated that as long as they are handling this, the Ethanol Plant will be servicing the debt. Mayor Taylor questioned how long the bonds were for. Mr. Howard stated that they were for ten years. Ms. Garten added that they have paid half the debt.
Mr. Howard reminded the Commission that the grant loan for the Ethanol Plant started out as a grant/loan and it had been converted to a full grant. Mayor Taylor commented that, contrary to popular opinion, this was a win/win situation for the City. Mr. Howard added that we put the water line in for about half the price, but in the north side of town from the water tower and down Highway 281, there were only multiple small mains and the fire service barely existed, we got the Ethanol Plant to improve those lines and they paid for it. Commissioner Nystrom added that we also own it. Mayor Taylor stated that when the bypass gets here, we will have water out there. Mr. Howard stated that the airport has problems with their wells and if we have to shut down one of those wells, we could be drawing the contaminants to the other well. Mr. Howard explained that he had visited with the USDA and we would get 100% funding to replace those lines.
Mr. Howard explained that we had bought easements on private properties and if the lines have to be moved for the bypass, the State would have to pay for it. Mayor Taylor commented that a lot of people are finding out that this was a good deal, but they still wonder about the road we had to pay for, the water line they had to pay for at the taxpayer’s expense and the plant is just sitting there. Mayor Taylor added that in all fairness to the Ethanol Plant, if they had been in production when they should have been and not had those problems, they would probably be running today. Mr. Howard commented that the plant is still there, but our thinking was that with the bypass going in, we did the infrastructure on someone else’s dime.
Capital Equipment Reserves:
Ms. Garten stated that this had been discussed earlier and it had been maintained at the same amount for years. Ms. Garten commented that she had increased capital equipment reserves in 2009 due to the big projects such as the fire station and the Main Street project. Mayor Taylor commented that the last two were contingencies. Ms. Garten stated that was correct and that we had saved for them and then we have budgeting authority to spend it. Ms. Garten commented that this is where you plan to use a portion of the funds for an upcoming project. Mr. Howard added that we had been planning on the Main Street project and we would be paying for it, so there will not be a bond issue or taxes levied. Mr. Howard stated that if we boar the water line on Main Street, it would come out of this authority. Mayor Taylor commented that the bricks are in poor shape and so is the water line and questioned if they would be taking out the bricks if we boar the water line on Main Street. Mr. Howard stated that that had just come up and that it makes sense to do it in two phases. Mayor Taylor asked how you do that. Mr. Howard commented that they would boar block by block and that the service lines are a bigger headache than the mains. Mr. Howard added that we do not want to disrupt the businesses any longer than we have to. Commissioner Hlavachick asked if we were looking at 2010 to do the water line. Ms. Garten stated that was correct. Mr. Howard commented that we would do it when business is slow and that we would start in the spring and be done by the holiday. Commissioner Hlavachick questioned if boaring the water line would affect the businesses less. Mr. Howard stated that it would. Mayor Taylor asked if it would be done block by block when doing the service lines. Mr. Howard stated that was correct.
Commissioner Hlavachick addressed his concern about doing the street at all and interrupting business with the economy the way it was. Mr. Howard commented that we have pushed the project out as far as we can. Mr. Howard explained that when planning this project we thought it would happen before 2011 and if a business was going to fail due to the economic downturn, it would be before that. Mayor Taylor commented that it would not hurt as much here as it would in Hutchinson and Wichita. Commissioner Nystrom suggested that some of this money may have to be used for relief funds.
Mr. Howard commented that the Chamber would be handling customer parking and notifying businesses of what was going to be made available. Commissioner Nystrom added that there would be parking at the J.C. Food’s Building also. Mr. Howard showed the Commission a map of the water line project.
State budget forms:
Ms. Garten stated that she had put in the State budget forms for the Commission to review and that if it is approved, then she would submit it to the County Clerk and she then sends it to the State. Ms. Garten commented that it is all to be done electronically this year.
Detailed worksheets:
• General Fund Summary:
Ms. Garten stated that we budget the revenue on five years of history and an estimate of what we think could happen and we take the conservative approach. Ms. Garten informed the Commission that the mill levy set for the general fund was 28.958 mills. Ms. Garten commented that not much else had changed from last year in the general fund.
• City Commission:
Ms. Garten stated that this fund was the same last year with the exception of the salary portion.
• City Manager:
Ms. Garten stated that this fund did not have the salary changed from last year even though it looks as though it has. Ms. Garten explained that the Commission had given Mr. Howard an increase after the budget had been approved last year.
• City Attorney:
Ms. Garten stated that this fund was the same as last year.
• City Clerk:
Ms. Garten stated that the fuel cost had been reduced in this fund, but nothing big had changed.
• Finance:
Ms. Garten stated that this fund was the same with the exception of computer replacements.
• Police:
Ms. Garten commented that there were no real changes in the police budget. Mayor Taylor asked if they were at full compliment. Ms. Garten stated that they were.
• Animal Control:
Ms. Garten stated that this budget had stayed the same. Mr. Howard commented that it appears that the Pratt Area Humane Society has gotten their act together. Mr. Howard stated that it has been discussed with Chief Holmes that when the animal control officer retires, we turn it over to the Humane Society. Mr. Howard commented that we would continue to fund them. The Commission and staff discussed the Humane Society situation for a short time.
Ms. Garten pointed out that the $1,000 donation to the Humane Society is taken from this fund. Commissioner Nystrom questioned where the $15,000 was funded from for the LEC. Ms. Garten stated that was in the Capital Improvement Reserve fund. Mayor Taylor questioned when the last time that committee met. Commissioner Nystrom stated that he did not know, but that the County had not budgeted anything for their LEC share, so they now have no air conditioning. Mayor Taylor commented that there was $150,000 sitting there to be used on the LEC. Commissioner Nystrom stated that the County was reluctant to do anything, because there is no money there.
• Municipal Court:
Ms. Garten stated that there were no changes in this fund.
• Fire Protection:
Ms. Garten stated that the fire department still budgets for equipment and the new fire station. Ms. Garten added that they also make a transfer to the capital equipment reserves for fire equipment and they wanted to point out that in the future they need to look at a new fire engine, which would cost about $300,000. Commissioner Nystrom questioned how long we have to pay on the leased truck. Ms. Garten stated that it would be paid off in 2011 and that those payments were $23,900.
• Planning & Code Enforcement:
Ms. Garten stated that this fund was up a little bit due to finally hiring a code enforcement officer. Commissioner Nystrom asked if this was where housing demo money comes from. Ms. Garten stated that it was. Mr. Howard added that he has $20,000 in his budget under professional services. Ms. Garten stated that code enforcement had $30,000.
• Parks:
Ms Garten commented that there were no changes in the park department that had not been discussed earlier.
Commissioner Hlavachick stated that he had gone to the KMU meeting in May and they had some Cities that put back $2,000 or so to replace trees from the 2007 ice storm. Commissioner Hlavachick explained that there would be a cost sharing between the City and the person in the amount of $150 or so. Commissioner Hlavachick stated that he would like to see the City do something like this and was not sure which fund would be appropriate. Ms. Garten commented that it could be put in the parks trust fund. Ms. Garten asked if Commissioner Hlavachick was suggesting doing this on private property. Commissioner Hlavachick stated that was correct and we could donate a maximum of $200 per household. Mayor Taylor questioned using tourism money. Mr. Howard stated that he would have to check the details on spending tourism funds and he thought that you could use tourism money to do street scapes, but he was not sure about private property. Commissioner Hlavachick repeated that he would like to see a commitment to this.
Commissioner Graf explained a program in Hutchinson that allowed a person to rent a plot to have a garden and he was curious if the large area in Lemon’s Park could be used for anything like that. Mayor Taylor commented that it would be good use for that area. Mr. Howard stated that we could do that and that the plan had been to put in a big commons area and another area with shelters, but this could be done in the mean time. Commissioner Peltier questioned who would be in control of that. Commissioner Graf stated that what you do in your are is your business. Commissioner Nystrom suggested that you could plant fescue grass between the plots to prevent the spread of weeds. Mr. Howard commented that he would like to get more information on Hutchinson’s program. Commissioner Nystrom commented that it would take self discipline.
Ms. Garten added that the parks department had put money in capital equipment reserves to replace playground equipment in 2012.
• Pool:
Ms. Garten stated that there was an increase in this fund due to the increase in minimum wage.
Commissioner Nystrom questioned if the kiddy pools were still used. Ms. Garten stated that they were and that they stayed busy. Commissioner Peltier asked what the pool manager got paid. Ms. Garten stated that she thought it was around $10 per hour. Mr. Howard stated that the manager and life guards were worth it due to the liability issues they can face.
• Municipal Building:
Ms. Garten stated that this fund was where the utilities and supplies were paid out of for the Municipal Building and the Community Center and a transfer to capital equipment for renovations down the road.
Commissioner Nystrom commented that it looks as though we are going to keep this building. Mr. Howard explained that there was a plan, not a plan of the City’s, which was that the Parrish Hotel and the Municipal Building could be made into a fitness center with an indoor pool separating them. Mr. Howard commented that after reviewing the cost of doing that, the project was not going to happen.
Mr. Howard stated that there had been discussion by the Blythe Foundation that if the school would donate the parking lot on Fifth Street and the foundation purchased the houses east of the parking lot, they would build a recreation center with basketball courts, etc. Mayor Taylor added that it would be a large metal building with three courts. Commissioner Hlavachick asked if there would be an indoor pool. Mayor Taylor stated that there would not be. Commissioner Nystrom asked if the foundation would also be removing the structures. Mr. Howard stated that he was sure about them buying the houses, but he was not sure about the removal. Mr. Howard commented that the County had agreed to take the materials, but not tearing down. Mr. Howard stated that he had not indicated that we would tear them down and that he would bring that before the Commission for their approval. Mr. Howard added that they would probably want that portion of Iuka Street vacated.
Commissioner Peltier commented that the foundation did not have enough money to do this project. Mr. Howard commented that they have had donations. Mayor Taylor commented that that had been a bad area of town anyway.
Commissioner Nystrom returned to the Municipal Building and the money that we keep pumping into it. Mr. Howard stated that we do not make any money on it, but we have community interest. Commissioner Nystrom asked what we would do if the recreation department is moved to the fire station, what do we do then. Mayor Taylor commented that we would not have to heat and cool it as much and that we could lower the ceilings. Commissioner Nystrom stated that we were heating and cooling the building for four people. Mr. Howard stated that there had been discussion on separating the heating and cooling in the recreation area so that you would not be doing the entire building. Commissioner Nystrom predicted that there would be a 90% drop in use when the new building is built. Mayor Taylor stated that there would still be people who want to use the Municipal Building.
Commissioner Graf stated that it should be opened up to weddings and dances. Ms. Garten commented that no alcohol is allowed in there. Commissioner Graf commented that maybe that needs to be changed and that the Knights of Columbus is booked all the time. Commissioner Graf added that after visiting with an ABC representative, he found out that you can only rent to members if alcohol is allowed. City Attorney Van Blaricum commented that he would research the ABC laws , but he thought there should be a way to do that. Mayor Taylor stated that if alcohol was allowed, we would want to charge a larger deposit.
• Recreation:
Ms. Garten stated that the recreation department had no changes.
• Public Works:
Ms. Garten stated that there were no changes in this fund and it had even been trimmed a little bit.
• Maintenance:
Ms. Garten stated that this was the fund for the Municipal Building and Community Center maintenance.
• Cemetery and Special Streets:
Ms. Garten stated that the cemetery and special street salaries come out of the general fund.
• Special Police:
Ms. Garten stated that this fund was for assistance if there was anything that the police department needed.
• Industrial Development:
Ms. Garten stated that this was where the $15,000 quarterly payment for Economic Development was paid from. Ms. Garten commented that we give the $60,000 and the City Manager has $20,000 that is used at his discretion.
• Transfers:
Ms. Garten stated that the 4999 was where the payment for the Teen Center, Red Cross, ABC Pregnancy Center, and the Food Bank are made from.
Special Revenue:
• Library:
Ms. Garten commented that this was where the 3 mill for the library is at.
• Cemetery:
Ms. Garten stated that this was the operations budget for the cemetery and there had been no changes to that fund.
• Noxious Weeds:
Commissioner Nystrom asked what noxious weeds were for. Ms. Garten stated that this fund pays for spraying for mosquitoes and weeds. Mr. Howard added that this was for weeds in the streets and parking lots. Commissioner Nystrom asked if the City takes care of Main Street. Mr. Howard stated that the cracks in the sidewalk are done by the City, but some businesses do it. Commissioner Nystrom asked if that was a safety issue. Mr. Howard commented that they do it on their own. Commissioner Nystrom commented that the City should have control over the chemicals that are used. Mayor Taylor stated that he had sprayed his own after walking one evening and noticed the weeds by the Municipal Building. Mr. Howard commented that some home owners spray the street in front of their houses.
Commissioner Nystrom asked if we had sprayed for weeds. Ms. Garten stated that we had and it had made a difference. Mr. Howard added that we try to time it around the rain and that we do a big spraying after the rainy season.
• Tort Liability:
Ms. Garten stated that this fund was used in the case of a lawsuit and there is a reserve balance.
• Special Streets:
Ms. Garten stated that this was where the ¼ cent sales tax was along with the City/County highway funds that are used for street maintenance and curb projects.
• Environmental Services:
Ms. Garten stated that this fund had been closed, but left in here for the history.
• Convention and Tourism:
Ms. Garten stated that this had been talked about earlier. Ms. Garten commented that by reviewing the revenues, you can see how the reserve has been built up. Mayor Taylor questioned if we were projecting $514,000. Ms. Garten stated that we were projecting $204,000, but the balance in the cash reserves is $310,000, so your total balance is $514,000. Ms. Garten stated that the opening of Comfort Suites had helped this, but we do not know what will happen with the economy situation.
Mr. Howard commented that the rooms at the Comfort Suites are more expensive, but they are full a lot. Mr. Howard stated that two-thirds of the weekends in the summer, the hotels in Pratt are full. Commissioner Nystrom commented that when he brings in a contractor, they cannot get a room. Mr. Howard commented that we get sales tax off of that also. Mr. Howard stated that you cannot beat the revenue generated by your hotels and restaurants.
• Alcohol and Drug Safety:
Ms. Garten stated that this fund was budgeted to close in 2010. Ms. Garten explained that the State no longer accesses the alcohol and drug fee so there is no longer any revenue coming in.
• Fire Fighting Equipment:
Ms. Garten stated that this was a tax levied fund of one mill used for that purpose and that we transfer from this fund to pay for the fire truck and other equipment.
• Special Police:
Ms. Garten stated that this was where we maintain the vehicle fees and forfeiture funds. Ms. Garten stated that there is a good reserve in there and that they can pay for anything police related. Mayor Taylor commented that we have about $304,000 in that fund. Ms. Garten stated that was correct and that is restricted on what it can be used for. Mr. Howard commented that the forfeiture funds had been used to pay for part of the mapping system. Mayor Taylor added that it also paid for the laptops in their vehicles. Mr. Howard explained that you cannot budget this money.
• Risk Management:
Ms. Garten stated that this fund had been closed as it was used like the tort liability fund.
• Employee Health Insurance:
Ms.. Garten stated that this fund was established for self-funding and has not been used for two years and will be closed in 2010 into the general fund.
• Bond and Interest:
Ms. Garten stated that this was where our bond and interest payments for GO bonds are paid and it is a tax levied fund.
• Special Parks and Recreation:
Ms. Garten stated that this fund was State mandated and the liquor tax goes into that. Ms. Garten stated that this has to be split three ways with a third going to parks, a third going to the general fund and a third going to a chemical dependency program.
• Special Alcohol:
Ms. Garten stated that this was the third that we pay out to a chemical dependency program. Ms. Garten explained that there was a threat that we would lose that due to the State budget cuts, but we are still getting it and they have dropped it. Mayor Taylor commented that he could see that being a real problem. City Attorney Van Blaricum commented that the State authorized a program for special alcohol counseling and it was free, but he would not be surprised if we lose that.
Enterprise Funds:
• Electric Department:
Ms. Garten stated that this was left the same as last year. Mayor Taylor questioned that we have $4,848,000 in cash carryover. Ms. Garten stated that that was correct. Mayor Taylor commented that this was where the $2,000,000 we made came from. Ms. Garten stated that was also correct. Mr. Howard commented that part of that was the first full year that we operated under the EMP2 agreement where we buy from Jeffries, buying from a pool or generating for ourselves. Mr. Howard stated that in 2006 and part of 2007 Aquila tried to boost revenues off of this part of the sale and they took advantage of the Cities. Mr. Howard commented that when we went into the EMP2, the revenues we are making are accumulated by how we make the fuel adjustments.
Mr. Howard explained that a fuel adjustment was whatever you pay for gas, coal or other source used to generate electricity and you charge an extra charge for that. Mr. Howard explained that when we were under the KCC’s jurisdiction, we had to pay that all back in that same year, but we got ourselves removed from the KCC jurisdiction at their encouragement. Mr. Howard stated that in 2008 we got conservative with the fuel adjustment not knowing how things were going to work. Mr. Howard added that this year we cut the fuel adjustment in half and he did not anticipate generating revenues like that next year. Mayor Taylor questioned the $1.8 million shortfall between 2008 and 2009. Ms. Garten stated that some of that was transferred over to reserves purposely for special projects. Ms. Garten added that we budget to use it, but do not always spend it. Ms. Garten stated that we budgeted last year to have a loose, but we came out ahead due to not spending all of it. Ms. Garten commented that we had transferred $685,000 to the general funds.
Ms. Garten stated that you also have the debt service account that is used to pay the electric revenue bond. Ms. Garten added that we also have a contingency in there of $50,000. Mayor Taylor asked if this was the only fund we transfer to the general fund. Ms. Garten stated that we also transfer $50,000 from sanitation.
Commissioner Peltier questioned if there was $53,000 in utility bills that were not paid. Ms. Garten stated that was correct. Mr. Howard stated that the collection efforts have improved.
• Sanitation:
Ms. Garten stated that this fund was the same and it was for operations and maintenance. Mr. Howard commented that it had been suggested to him to do the clean up week again, but that week usually turned into six weeks or more. Commissioner Peliter questioned if the landfill would waive the landfill fees if it was taken out there personally. Mayor Taylor commented that they used to.
Ms. Garten commented that the landfill charges were $350,000, which was up due to the 10% increase. Commissioner Nystrom commented that he thought in another year, we would not be doing trash. Commissioner Graf asked if it would be cheaper to go to a private company. Mr. Howard stated that it would be cheaper for the City, but not for residents. Mr. Howard commented that he has been told that we are too cheap, but we are not looking at generating revenue. Mr. Howard commented that the injuries in that department would make it worth looking into a private company and keep a couple of trucks for special events that we would do the pickup. Commissioner Nystrom commented that when Mr. Phil Harmon retires might be a good time to look at it further. Commissioner Nystrom added that the building was in bad shape. Mr. Howard stated that it was and that was an example of a fund that does not generate enough revenue to keep the building up. Commissioner Nystrom commented that having a private company would also prevent the wear and tear of the alleys. Mr. Howard commented that the City could charge the private company a 5% franchise fee.
• Wastewater Treatment Plant:
Ms. Garten stated that this fund had budgeted two motor lift stations for the airport. Mr. Howard added that they were the lagoons east of the highway. Commissioner Nystrom questioned if all the maintenance at the airport was the City’s responsibility. Mr. Howard stated that it was.
• Water:
Ms. Garten stated that the question in this fund was how long the Ethanol payment would continue and that they had set the budget to reflect that they will. Mayor Taylor questioned what we would do if they did quit making those payments. Mr. Howard stated that we would have to service the debt. Ms. Garten stated that we would not have as much revenue in the water fund and look at additional revenue sources from transferred funds. Commissioner Nystrom questioned what their payment was. Ms. Garten stated that it was $14,389.
Mr. Howard stated that one of the things he would do to negotiate with them to keep the payments going would be to remind them that we gave them a good deal on water. Mr. Howard stated that he has visited with their attorneys and that if they want us to cancel the agreement, whoever they sale the plant to will be paying triple the cost for water.
Mr. Howard explained that the contract included the Frisbie well and we do not have ownership. Mr. Howard commented that if they ever wanted future water needs, then they were responsible for developing that well into a municipal well to pump into our system on their dime. Mr. Howard stated that he had a proposal in mind and shared that with the Commission.
• Utility Deposits:
Ms. Garten stated that this fund was where we maintain the deposits on utilities.
• Utility Receipts:
Ms. Garten stated that this fund recorded the long and short on utility receipts.
• Agency Funds:
Ms. Garten stated that we have four agency funds that we collect money on such as the trust funds in the Cemetery and Parks.
• Recreation Trust:
Ms. Garten stated that this was gate receipts and donations to the recreation and those funds are managed through here.
Reserve Fund:
• Water Bond Reserves:
Ms. Garten stated that this fund was required by the bond instrument that would pay a portion of the bond back. Mayor Taylor questioned what that portion was. Ms. Garten stated that it was one principal payment plus one-half of next year’s interest.
• Water Bond Interest:
Ms, Garten stated that this was where we pay for the revenue water bond payment. Ms. Garten explained that this was transfer out of the water fund into this one.
• Electric Debt Service:
Ms. Garten stated that his was the same type of fund and that there is a transfer from the electric fund into this fund to pay the electric utility revenue bond.
• Wastewater & Water Reserves:
Ms. Garten stated that these are required by the bond issue.
• Capital Equipment Reserves:
Ms/ Garten stated that this fund was where all the departments transfer money for major purchases.
• Special Street Reserves:
Ms. Garten stated that this was where the funds were to work on Main Street and to do big projects. Ms. Garten added that this was also where the preliminary engineering costs were paid from. Mayor Taylor questioned the unencumbered cash. Ms. Garten explained that this comes from the general fund and money is put back for several years for a major purchase, such as the $300,000 put back for the Main Street project. Ms. Garten added that KLINK money and geo improvement money goes in here.
• Capital Improvement Reserves:
Ms. Garten stated that this fund works like the capital equipment reserves and the boaring of Main Street water line will be coming out of this.
• Electric Maintenance Reserves:
Ms. Garten stated that this is in case there is a large claim and we pay a portion of the insurance deductable out of here.
• Fire Fighting Equipment Reserves:
Ms. Garten stated that this fund is where the lease/purchase agreement is paid from and also improvements for the fire station.
Riney money, etc.:
Commissioner Nystrom questioned where the Riney money was. Ms. Garten stated that it was in Parks and Recreation trust fund. Commissioner Peltier asked how much money we have for all our various projects such as the fire station and street fund. Mayor Taylor asked if he wanted to know our bond indebtness and everything. Commissioner Peltier commented that just the money we have in various funds for projects. Ms. Garten stated that you have to have it that way and the auditors said our total cash was about $20 million. Commissioner Peltier asked if we were moving it around. Ms. Garten stated that most of ours is in CD’s. Ms. Garten explained that the banks work well with us to get us the best rates and it is at 1.3% now.
Discussion Topics:
Sunflower H2O funding:
City Manager Howard stated that the City needs to look at other sources to get water from in the future such as the 800 acre feet dedicated to the Ethanol Plant and the Frisbie well. Mr. Howard commented that other communities do not have water, but we do and that we would be looking at Sunflower’s projects for other purposes. Mayor Taylor commented that with $57,500 we could hire our own engineers. Commissioner Graf commented that he was confused as to what they thought their next step would be and we would not be sure what our money would be investing in. Mayor Taylor commented that they probably need to do more studies so they would need even more money down the road. Mr. Howard stated that he had not thought they had done a worthwhile presentation since this project started. Commissioner Graf commented that they could not promise that our money was going to buy anything. Mr. Howard commented that there are communities that need water and are not participating, so why should we.
Mayor Taylor asked if there was a motion on supporting Phase 2 of the water study. Due to lack of a motion, there will be no funding from the City of Pratt for Phase 2 of the water study.
Steam plant:
Mr. Howard stated that there was a big decision to be made about the steam plant and replacing the cooling tower. Mr. Howard stated that the cost of a new cooling tower would be about half a million dollars. Mayor Taylor commented that you cannot run the steam plant without it. Mr. Howard stated that you cannot run at full capacity without it. Mr. Howard explained that we could crank it up to 14 mgs, but Mr. Ernie Smith, power plant superintendent, said that we may get 7 mgs. Commissioner Peltier asked what 7 mgs gets us. Mr. Howard stated that it was about a third of our load. Mayor Taylor commented that on a hot day we probably use 23 mgs.
Mr. Howard explained that we were a partial requirement City, which means that you generate your load or part of the load and you have to be able to produce 112% of the peak load. Mr. Howard stated that if you are not a partial requirement City, you have to be a full requirement City and you have to get firm electricity. Mr. Howard explained that our less than 9 mgs is called a firm contract, which you can use for your capacity requirements.
Mr. Howard explained to the Commission that there is a MKEC Unit demand charge on our bill from KMEA and the copy of the bill in front of them has that charge at $203,000 for less than 9 mgs. Mr. Howard stated that we pay that demand charge every month whether we use it or not and that is a big part of our electric bill as the actual price of electricity. Mr. Howard commented that generation, even when we are not running, is worth something. Mr. Howard stated that if we keep our generation up to 112% of our load, we can support ourselves with our own generation.
Mr. Howard explained that if you take this price that comes down to $22,583 per mg, take the generation of an additional 7 mgs of the steam plant per month, you are talking about $2,000,000 a year. Mr. Howard commented that if you replace that generation with firm power, we would not be a partial requirement city, but a full requirement City. Mr. Howard stated that if you replace firm power with generation not doing anything, we make or save money. Mr. Howard stated that you have the capabilities of generating your own load. Mr. Howard explained that we are getting a good price from Jeffries and that it is the transmission and demand charges that are high. Mr. Howard commented that if you buy off of the schedule c market, your demand charges are less but your electricity is a little higher. Mr. Howard stated that if we are generating we are paying 5 ½ cents for electricity, but our demand charge is far less. Mr. Howard commented that we are better off being able to buy off the market than having that firm generation. Mr. Howard stated that we need to rebuild the cooling tower at the steam plant to remain a partial requirement City, which is what we want to do.
Mr. Howard commented that the chances of us ever running either steam unit, unless it is an emergency, probably would not happen unless the price of gas drops down to a $1 or $1.50 per mcf. Mr. Howard stated that the City either needs to keep the steam plant up and running or abandon the steam plant and look at funding new generators. Mr. Howard stated that the best option would be to keep the steam plant and bring it up to compliance and fire it up every three years to keep it in compliance. Mayor Taylor asked when we were to do that. Mr. Howard stated that it was supposed to be this summer, but since we have had the problems with #7, it was put off until next year. Mayor Taylor commented that we have to have the cooling towers up. Mr. Howard stated that we could run the steam plant with the one tower, but we would only get what we are getting out of one of the generators. Mr. Howard stated that to be in compliance, you have to be in a stress condition.
Mr. Howard commented that now that the Holcomb plant is not going to be built, Sunflower and some other generators are short of capacity. Mr. Howard stated that the capacity of that plant is valuable and we have not dedicated our capacity to anyone. Mr. Howard explained that we want to dedicate this capacity on our own instead of using an agent. Mr. Howard informed the Commission that we had to run for Sunflower for a day three weeks ago and they paid us $20,000. Mayor Taylor questioned if that was $20,000 profit. Mr. Howard stated that you have to subtract the gas prices from that.
Mr. Howard stated that his recommendation was to fix the steam plant and that that saves us a lot of money even if it is just sitting there. Mr. Howard explained how the cooling towers operate and that the steam plant was for emergencies.
Mr. Howard stated that if the economic issues are not worked out, we could face a recession and that is why you want to run the City like a business. Mr. Howard commented that we need to decide if we want to become a full requirement City and we would be talking about significant money. Mayor Taylor questioned what the life of the cooling tower was. Mr. Howard stated that it was about twenty to thirty years and that this one is about twenty-five years old. Mayor Taylor asked what a steam engine would cost now. Mr. Howard stated that the turbine would be about $19 million and that would replace 5 & 14. Commissioner Hlavachick commented that no one thought we should buy the portable generator and we used it right off, so it is better to have it than not and that is how we need to look at the power plant. Mayor Taylor stated that we need to do it. Mr. Howard commented that he would get bids out.
Mayor Taylor questioned how long it takes to get the tower up. Mr. Howard stated that it should be early next year. Ms. Garten commented that we had been saving up for this for quite some time.
Maple Street project:
City Manager Howard discussed the Maple Street project and showed the Commission a power point map of the area. Mr. Howard commented that we had or are in the process of purchasing the property from Mr. Kenny Gates and Mr. Blake Himmelwright. Mr. Howard stated that he had asked Mr. Alan Luttrell of EBH Engineering to do a preliminary survey for putting in the street. Mr. Van Blaricum, City Attorney, stated that the property was in the hands of the abstract company and they should be closing in a week or two. Mr. Howard stated that he was recommending plating Maple Street. Mr. Howard explained that to get anyone in town, you have to have the area platted. Commissioner Nystrom questioned what the cost of the Maple Street extension was. Ms. Garten stated that it was about $1.2 million. Commissioner Peltier commented that the biggest expense were the roads. Ms. Garten added that the total cost of the project would be about $3 ½ million.
Commissioner Peltier commented that the biggest expense is not platting and asked how they were going to be sold. Mr. Howard stated that the cost would be incurred by the City to plat and that somebody has to do that. Mayor Taylor commented that he was starting to have cold feet about the project. Commissioner Hlavachick asked if he meant the whole project. Mayor Taylor stated that he was in favor of the street extension. Mayor Taylor added that $1.2 million is a lot to spend all at once not knowing if things are going to bottom out and that there were already a lot of houses on the market that are not selling.
Mayor Taylor asked if the $1.2 million was in the budget. Ms. Garten stated that it was not. Mayor Taylor questioned how this was going to be funded. Mr. Howard stated that there are cash reserves over two years and it would be the same way we are doing the Main Street project. Mr. Howard explained that the water and wastewater would be contracted out and the electrical would be done by the City with money in contingencies to do the infrastructure.
Mayor Taylor questioned why we could not do it in three years instead of two if it was not already worked in. Commissioner Graf commented that he hated to do something like this with all the layoffs and it could cause a mess. Mr. Howard stated that this was why we brought this up for discussion.
Commissioner Graf asked how much land we had purchased. Mr. Howard stated that it was forty acres. Commissioner Peltier commented that there are twenty-three acres that are developable and twenty acres of creek, but we would get our money back from the sale of the lots and the electricity. Commissioner Graf commented that you have to sell them first. Mayor Taylor commented that you have to build the road first.
Mr. Howard pointed out the area that the church has already approached the City about and wanted to purchase. Mayor Taylor asked what a lot would go for if it was developed. Mr. Howard stated that you have to plat Maple Street first. Mr. Howard commented that this was part of economic development to have a place for people to go and have it site ready.
Mr. Howard stated that the area north of the Green Sports Complex could be developed into a high density apartment building and it was not unwise to have those areas platted and ready to go. Mr. Howard stated that platting Maple Street was a small cost to this. Commissioner Nystrom commented that he is one who puts his money where his mouth is and you have to invest in the community. Commissioner Nystrom added that this would be a wise investment.
Commissioner Peltier commented that we need to get it plotted and get the street in. Mayor Taylor stated that he wanted to wait until 2011. Commissioner Nystrom stated that it will never be cheaper to do it. Mayor Taylor commented that we do this the same as we did Main Street. Mayor Taylor commented that he got calls thanking him for not voting for the Maple Street project and he also got comments that it was a bad idea to reject it. Mayor Taylor clarified that he was not against the project, he just wanted to wait. Commissioner Nystrom commented that a lot of people want us to do it. Mayor Taylor commented that we need to do it eventually, but just not right now.
Mr. Howard stated that the sequence should be to get it platted and plotted, because you cannot build a house without Maple Street being there. Commissioner Nystrom questioned getting it graded and able to drive on. Mayor Taylor stated that he liked that idea, then in 2011 we would have the money set aside to finish it. Mr. Howard commented that it would be a good addition to the City once the bypass is built.
Mr. Howard questioned Mayor Taylor about getting it platted and plotted. Mayor Taylor stated that he did not have a problem with that and asked what the cost of that would be. Mr. Howard stated that it would be less than $10,000.
Commissioner Graf asked who would be doing the development. Mr. Howard commented that the City was going to do that initially. Mayor Taylor stated that he was not in favor of that. Mr. Howard stated that we would own the lots and utilities and when the lots sold, the money would go to reimburse the City for the cost of the project. Commissioner Peltier asked if we would have to put in a bridge. Mr. Howard commented that there would be a low water crossing marker, because it could be a traffic safety issue.
A motion by Commissioner Peltier to plat the big lot on the new property for Maple Street project. The motion was seconded by Commissioner Hlavachick. Mayor Taylor questioned that we were only talking about a cost of $10,000 for the plat. Mr. Howard stated that he would get back to them with a figure. The motion passed with four approved votes and one no vote by Commissioner Graf.
Industrial Park:
Mr. Howard stated that Phase 2 of the Industrial Park was on hold, because Mr. Terry Richardson had backed out of the property he was going to purchase due to economic issues. Mr. Howard commented that there were still three lots now that could be sold, so plating of the east half of the Industrial Park was not as pressing. Mayor Taylor asked if the Industrial Park was eight acres. Mr. Howard stated that there were eighty total acres, but we will need to plat the last forty eventually. Mr. Howard added that it is important to have those lots.
Local bidding process:
Ms. Garten stated that another topic for discussion is the local bidding process and how to define it. Mayor Taylor stated that local is definitely the City of Pratt and anyone who pays Pratt property taxes and that includes the airport and Industrial Park.
Commissioner Peltier asked where we draw the line on the dollar amount. Mayor Taylor stated that a $100,000 job would be $5,000. Commissioner Peltier questioned if we want to do the 5% on material only. Mayor Taylor commented that that would change their way of bidding.
Mayor Taylor commented that he would not have voted for Mansel Construction to do the fire station. Commissioner Peltier commented that they buy their trucks here in Pratt. Mayor Taylor commented that they do not live in Pratt County and he would have looked at that if he had been at the meeting.
Commissioner Peltier asked if we wanted to put a cap of $100,000 on the 5%, but added that that could cause other issues. Commissioner Peltier questioned if we advertise that 5% in our bids. Mayor Taylor stated that we do not. Commissioner Nystrom commented that the salesman from Medicine Lodge at the last meeting stated that he had been cut out of a deal because he was from Medicine Lodge. Mayor Taylor commented that you can lose a bid over a local regardless if it is the low bid. Commissioner Nystrom stated that he felt neither one lived in Pratt and that Kessler Construction’s tax money was not going to the fire station. Mayor Taylor commented that he was the local bidder, because he lived in Pratt County. Mayor Taylor added that $750 is a close bid, but Mr. Kessler helps us as a tax payer in Pratt County and so he felt that he was more local. Commissioner Peltier stated that if the first local s\is the City and the second is Pratt County, we need to state that somehow. Commissioner Nystrom commented that we send it out with the bid. Commissioner Hlavachick commented that we can give to another bidder even with the 5%. Mayor Taylor commented that they get 5%, because their money stays local.
Mr. Howard commented that we need to amend the Resolution to get this definition in place. City Attorney Ken Van Blaricum stated that he would get that amended and bring it back to the Commission. Mayor Taylor asked that Mr. Van Blaricum use good words while doing this.
Utility rates:
Mayor Taylor questioned if there was any way to give citizen a break on our utility rates. Mr. Howard stated that the bills from last year at this time were higher than they are this year. Mr. Howard explained that it was because of the lower electrical costs and not because of lower rates. Mayor Taylor asked if it cost less per kilowatt. Mr. Howard stated that we are cutting costs to buy electricity and that is reflected on the customers. Mr. Howard commented that we may be a little high on the electric, but we are not on the water and sewer, so if we cut the electric rates, we would have to raise the water and wastewater.
Mr. Howard commented that to lower the rates, we would have to amend the ordinance and right now, the rate depends on how much you use. Mr. Howard added that it is best to let inflation take care of it. Mayor Taylor questioned cutting it a ½ cent per kwh. Mr. Howard explained that you do not want to get yourself in a situation where you have to raise it a lot down the road. Mr. Howard added that you want to be careful when collecting revenue.
Commissioner Peltier asked about the fuel adjustment and when fuel goes up, the electric bills go down. Mr. Howard explained that we were not averaging the fuel adjustment this year. Mr. Howard stated that with the revenue brought in last year, we do not need the revenue in electrical this year and should come out about even at the end of the year. Mr. Howard commented that it was good to have the reserves that we have, because if the economy goes down, the amount of people that cannot pay would get worse and so would that debt.
Mr. Howard asked if we cut the rates, are we going to have to cut our service. Mr. Howard explained that we trim trees that are not ours and do things for people that are customer service related. Mr. Howard stated that after we strengthen our system and have it up to par, then we could look at reducing the rates in a few years.
Ms. Garten stated that through the FEMA mediation, the City has twelve projects going from the ice storm. Mr. Howard commented that some of these were before we knew that FEMA was going to reimburse us.
Mayor Taylor questioned if we had moved that meter to the road for Mr. Loren Barker. Mr. Howard stated that he had called Mr. Kelly Hemphill, Director of Electric Utilities, and said that the trees had been trimmed back, but Mr. Hemphill stated that they were not done enough. Mr. Howard commented that he was not sure if they had moved the meter, but he would check.
Mr. Howard commented that there were changing times with electrical issues and if stability would happen, it would be easier to do things. Commissioner Peltier commented that energy was an international issue that we have no control over. Mr. Howard commented that we control what we can. Mr. Howard stated that BP Energy had leased a lot of ground for wind generation, but you look at Boone who backed out and you have to wonder. Mayor Taylor commented that there have been a lot of calm days lately. Mr. Howard stated that wind generation comes on line when you do not need it and off when you do.
Publication:
Ms. Garten commented that she would have the sheets for publication at the next meeting. Mayor Taylor asked when we do the report and how much time we have. Ms. Garten stated that you have to publish ten days before the public hearing and to the County Clerk by the 25th of August, so we would publish by the 5th. Mayor Taylor commented that he would like to see us drop one mill more or about $40,000. Commissioner Peltier asked why. Commissioner Nystrom commented that we are not raising the burden on the City. Commissioner Nystrom stated that he felt we had done the best we could do for Pratt. Commissioner Hlavachick stated that he thought we had done a great job.
Mayor Taylor thanked the Commission for going into the land a little slower on Maple Street.
Commissioner Peltier asked if they were going to leave in the 3% increase for personnel. Commissioner Hlavachick stated that it should be left in.
EXECUTIVE SESSION:
A motion by Mayor Taylor to go into executive session for thirty minutes to discuss non-elective personnel at the request of Commissioner Graf and City Manager Howard. The motion was seconded by Commissioner Hlavachick and approved unanimously.
A motion by Mayor Taylor to return from executive session with nothing to report. The motion was seconded by Commissioner Hlavachick and carried unanimously.
ADJOURN:
A motion by Commissioner Hlavachick to adjourn. The motion was seconded by Commissioner Peltier and carried unanimously.
_____________________________________
JEFF TAYLOR, Mayor
(SEAL)
ATTEST:
_____________________________________
LUANN KRAMER, City Clerk
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