To get the process rolling for the bond issuance for a third fire station, the Warsaw Common Council Monday night approved a resolution advertising a public hearing for 7 p.m. Nov. 7.
The purpose of the public hearing, according to the resolution, is “for the purpose of receiving public input regarding the consideration of the adoption of a resolution making a preliminary determination to issue the bonds to provide financing for the project …”
Station 3 is planned to be on CR 200S by Warsaw Community Church. The Board of Public Works and Safety approved an engineering agreement with MartinRiley Architects-Engineers at its Sept. 16 meeting, with the project estimated to cost $3,623,852.
The resolution approved Monday states the project is not to exceed $3.9 million. The township board meets Tuesday evening.
Randy Rompola, from Baker, Baker & Daniels, and Todd Samuelson, from Umbaugh & Associates, provided the council with further information on the process.
Samuelson said the project itself would not be until early 2017, subject to the township and city council’s actions.
One component of the overall city budget is its debt service fund.
“Within the debt service fund there’s a levy to repay principal interest on the general obligation bond of 2014,” Samuelson explained. “The final payment on those bonds will be in calendar year 2017. … Absent getting the fire station bond in place before the end of the year, what the (Department of Local Government Finance) would do is, the debt service bond also has a cash balance as part of its structure, just like the General Fund has a cash balance. In the year of the final payment, if there’s not another debt service or another debt the city has to consume, the DLGF will apply that cash balance and, in essence, buy down or reduce the amount of levy that’s needed in ’17 to retire the bonds.”
Then what would happen is, if the city issues the bonds for the fire station in 2017, the city would have to raise that levy back up in 2018.
“So what we’re trying to avoid here is the yo-yo effect,” Samuelson said, noting that they want to keep the rate steady through the retirement of the 2014 bonds and bringing on the bond issue for the fire station within the DLGF guidelines. He said that’s the reason for the timing of Monday’s resolution, as well as the notification timeline.
The city has to bear the risk of issuing the debt because state statute does not allow the fire territory itself to be the issuer of the debt. It only allows for the providing unit (the city) to be the issuer of the debt, he said. It also “does not allow the township to play a component of their budget toward a payment to the providing unit.”
So that leaves the township and city with a memorandum of understanding, an interlocal agreement, which has been discussed. The township is to discuss that type of arrangement at its meeting today.
Samuelson said the bond issue of about $3.7 million will be paid over a period of about 11 years, with annual payments of about $320,000, with the city covering about two thirds of the cost.
The interlocal agreement between the city and township is yet to be drafted. Mayor Thallemer said he feels comfortable with the township’s participation.
Establishment of the fire territory and inclusion of the township, the coverage area expanded from 10 square miles to 42 square miles.
“It’s a big necessity to have a station more approximate to the township residents and the southern residents of the city,” he said.
Rompola said that by approving the resolution Monday night, the bonds could be closed out by Dec. 28. After the public hearing Nov. 7, Rompola said the council also could approve the preliminary determination resolution, have first readings of the bond ordinance and appropriation ordinance. Then on Nov. 21, another public hearing would be held on the appropriation and consideration of ordinances, which would be the final action of the council.
Fire Chief Mike Wilson said the fire territory is planning to hire three additional firefighters for each of the three shifts. Two were already hired this year, with three or four more planned for 2017.
The council approved the resolution unanimously.
In other business, the council approved:
• The ordinance adopting the 2017 appropriations (budget) and tax rate on second reading. It was approved on first reading during the Oct. 3 council meeting.
Thallemer said the city has been working on it since June with department heads and not-for-profits. The current tax rate shown on it is $1.3818, but he said that was a starting point and after cuts were made, it could go down to as low as $1.29. The adopted budget total is $24,853,362.
The council voted 6-1 to approve it, with Ron Shoemaker voting against it.
• The 2017 general salary ordinance on second reading. It was approved on first reading Oct. 3. The ordinance establishes maximum compensation levels for department heads, appointed positions and certain salaried and non-salaried positions.
• The 2017 Warsaw-Wayne Fire Territory salary ordinance on second reading. It was approved on first reading Oct. 3.
The general salary ordinance and fire territory salary ordinance had to be approved by the end of November.
• Tabling the elected officials salary ordinance until further notice. It also was tabled at the previous council meeting. The council has until the end of the year to approve it.
• An ordinance amending the employee personnel policy handbook for emergency closings on second reading. It was approved on first reading at the Oct. 3 council meeting. Thallemer said it mirrors the county ordinance.
Jennifer Whitaker, human resources director, said the city was “just trying to make it fair so that people are not penalized for having to use benefit time or go into a non-pay status when it wasn’t their choice not to come into work.”
• Tabling an ordinance amending the employee personnel policy handbook for code of ethics to give the council more time to review it.
• On first and second reading an ordinance transferring a total of $16,500 for the purchase of a used tandem dump truck from the county.
