HomeMy WebLinkAbout1970-05-26; Water Committee Ad Hoc; MinutesMINUTES OF: WATER COMMITTEE MEETING
DATE OF MEETING: May 26, 1970 - 7:00 P.M.
PLACE OF MEETING: City Manager's Conference Room
PRESENT: Bob Watson, Bill Esterline, Carl Prince, Don Hickethier,
Bob Neely, Thelma Sowell, Stu Wilson
Special Guests: Fritz R. Stradling, City Legal Counsel with
Rutan & Tucker and Ed Wells, Bartle Wells
Absent: W. D. Cannon, Knox Williams, Glenn McCoraas, Win Priday,
Hunter Cook
Mr. Watson stated some determination is needed as to the
City's position concerning the construction program and how we
can get it underway. Mr. Wilson stated this Committee would
like some record on how much bonds should be sold, at what water
rates, and the position regarding previous issues. The Auditor
raised the question as to whether the two issues could be merged
and whether the Water Department could fund the sale. O'Melveny
and Meyers quoted that there could be no merger of issues. Both
bonds should be issued at parity.
Mr. Watson asked how much the City can sell and at what
water rates. Mr. Wells replyed that the modification of rate
increase results in less for bond sale. The sale of one million
would not necessarily fund the water improvement. Mr. Wells and
Mr. Stradling feel that excess funds in reserves should be used
for improvements.
Mr. Wells stated evaluation of the legal determination
should be the basis of any sale. At present there is a market
for one million at 7 percent. One-half million could probably
be marketed at a discount.
Reference was made to a letter, dated October 14, 1968 as
legal advice. It is against Mr. Wells' better judgment to sell
bonds when other resources or funds are available.
Mr. Stradling stated the City Council can authorize bonds
that have been authorized at 6 percent to 7 percent due to new
legislation.
Mr. Esterline questioned the timing of the project. Mr.
Wells stated it takes nine weeks for the sale of bonds. It
was reported that Hunter Cook did not expect the beginning payment
until the first week in September for construction.
Mr. Watson stated some determination should be made on
when the City decides on the size of the bond issue. Mr. Wells
listed three alternatives to the sale of bonds:
— 2 —
1. Based on Audit.
2. City Engineer certification of ability to serve new area,
3. Raise rates to maintain net coverage.
Mr. Esterline asked what is needed to get started?
Mr. Stradling stated he will send an outline on the sale of bonds,
Discussion was held on the meeting with Messrs. Stradling,
Wells and Carroll.
Mr. Wells requested copies of the Water Committee minutes
for the last six months.
NOTE: Next meeting will be held June 15, 1970 at 7:00 P.M.