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Council approves water/sewer bond measure

By Staff, 10/17/18 10:05 AM

PRESCOTT – In its October meeting, Tuesday night, the Prescott City Council voted to move forward with a water and sewer bond issue.

Ryan Bowman, with the Friday Law Firm in Little Rock, talked about the issuance of the bonds. It was pointed out the council took the first steps about a year ago by raising the water rates for customers of Prescott Water and Light. The council’s part, he continued, was to approve two ordinances to move forward with the bond project.

The first ordinance was to approve five public places to post the ordinances since there is no longer a paper of record in Nevada County. The panel approved to have ordinances placed at City Hall, the Nevada County Courthouse, the Bank of Delight, Bank of Prescott and Cash Savers as these are heavily trafficked areas.

The second was the bond issue itself. Bowman said there were two series bonds with the city pledging water and sewer revenues for $2.7 million in bond money, and a second bond of $300,000. The second bond, he pointed out is structured as a bond, but is more of a grant that doesn’t have to be paid back as long as the city follows the proper procedure. The $2.7 million bond will have a 2 percent interest and 1 percent service fee or 3 percent interest to be paid back, with the payout date being Oct. 15, 2050. The plan, he said, will close on Nov. 28 and the first interest payment will be April 15, 2019. Interest payments, he pointed out, will be due every six months until April 15, 2021, when the first principle payment is made.

The city, he continued, currently has four bond issues being paid off, and will be limited in getting new bonds. However, he added, there is nothing to prevent the city from refinancing its current bonded indebtedness to generate more revenue if needed. Bowman also told the council no money from the electric department can be used to pay off the water and sewer bond being sought. This was approved with a 7-0 vote.

The council also approved an ordinance to keep the 5 mill property tax for the city. This isn’t a new tax, but an existing one the council must vote on annually. City Attorney Glenn Vasser said it’s important because it’s how the city gets turnback money.

Robbie Franks, code enforcement officer, said 32 letters were mailed out last month, with 17 going to the east side of town and 15 to the west. Five involved inoperable vehicles in yards, with the rest dealing with grass, trash or junk. Clean up was done by 27 of the recipients, but most of the rest of the property owners live out of state and there’s nothing he can do.

He pointed out more letters were sent to the owner of 218 E. 2nd, across from the courthouse, as a shard of glass fell from a window and almost hit someone.

Vasser said everything that can be done is being done. He said the ideal thing would be for the building to be sold and renovated as a local contractor has expressed interest in buying it. He added, the building does have historical significance.

The owner of the Prescott Motor building didn’t show up for a scheduled meeting and hasn’t responded to letters or calls. Franks said a contractor would be needed to take the main building down as it’ll either have to be cut apart (as it’s mostly metal) or unbolted. Bids, he added, have been taken on the proposed project and range from $30,000 to $200,000.

Vasser said the land would need to be appraised without the buildings as it has marketability and the city could recover some of its money.

The buildings would have to be condemned for the city to do this.

Franks talked about other houses needing to be razed, with one in particular being owned by someone, but with the deed in another person’s name. All involved have agreed the house can be torn down, but the problem is, it’s owned by the state for back taxes and the city would have to get the state’s approval.

Franks said he’s cleared the title of 22 houses to be torn down and 12 owners have signed contracts to allow the city to demolish structures on their property. The city will have to rent a track hoe to take the buildings down.

Councilman Tommy Poole asked about the electric situation. Vasser said a settlement conference is coming up soon and he’ll see if the city will benefit from it. If not, the city can file charges against SWEPCO.