8.8 Water Rate Decreases CITY OF SALINA
REQUEST FOR c(~MMIsSION ACTION DATE TI,ME
5/7/90 4:00 P.M.
AGENDA SECTION: Administration ORIGINATING DEPARTMENT: APPROVED FOR
NO. 8 Department of Finance AGENDA:
!TEM
NO. 8
BY: Robert K. Biles~ BY: ~
Ordinance Number 90-9384, an ordinance repealing Section 41-91 of the Salina
Municipal Code prohibiting water or sewer rate decreases when revenue bonds
are outstanding.
Due to the requirements of the revenue bond ordinances under which we
operate, the City is required to maintain fees sufficient to meet operating
expenses, debt service and various capital outlay and reserve requirements.
Investors rely upon these covenants and the independent auditor's confirmation
of the City's compliance with these covenants. Thus decreasing rates may or
may not affect the City's ability to meet these covenants.
With the uncertainty involved in future bids and the amount of the KDHE
grant for the sewerage' system, favorable variances may allow for a decrease in
the rates presented by Wilson and Company. Adoption of Ordinance Number
90-1111 will provide future City Commissions with the flexibility to lower'rates
if warranted.
Recommendation
Introduce Ordinance Number 90-9384 on first reading.
COM~ISS ION ACTION
MOTI ON BY SECOND BY
TO:
(Published in The Salina Journal May , 1990)
ORDINANCE NUMBER 90-9384
AN ORDINANCE REPEALING SECTION ~,1-91 OF THE SALINA CODE
WHICH PROHIBITS WATER AND SEWER RATE DECREASES WHEN REVENUE
BONDS ARE OUTSTANDING.
WHEREAS, sufficient protection for bondholders is provided by
revenue bond covenants requiring certain levels of debt service coverage, and
WHEREAS, the decreasing of rates does not necessarily result in
non-compliance with revenue bond covenants, SO NOW, THEREFORE
BE IT ORDAINED by the Governing Body of the City of Salina,
Kansas:
Section 1, That Section 41-91 of the Salina Code is hereby repealed.
Section 2. That this ordinance shall be in full force and effect from
and after its adoption and publication once in the official city newspaper.
Introduced: May 7, 1990
Passed: May 14, 1990
Robert E. Frank, Mayor
[SEAL]
ATTEST:
Jacqueline Shiever, City Clerk