HomeMy WebLinkAboutWater Board - Minutes - 10/12/1964MINiTTFS OF A JOINT MF_nTING OF THE FORT COLLINS WAT7R BOARD AND THE
CI7V CO?TNCTL F 7T,D OCTOBER 12, 1964, AT 7:30 O'CLOCK IN COUNCIL
Present: President Ward Fischer, Mayor Johnson, Board Member
Fred. Felt, Councilmen J . w. Guyer, Colwell and McMillan, Acting
City Manager Lynch, Assistant City Attorney March, Jr., Director
of TTtili.tyes Stanley Case, Mr. Joe T. Banner, Harry Johns and
Jack Hull of Banner and Associates, and Owen Moore of _3oettcher
and Company.
Mr. J. T. Banner reported that the water needs for Treatment
Plant, Distribution System and repairs to existing reservoirs
would take an amount of ,2,828,000.00. He proposed a bond issue
of$p3,200,000.00 in order to allow some leeway. Mr. Owen Moore
of Boettcher and Company stated that the City has a Moody's
AA rating and should be able to get the same rating from
• Standard and Poor. Because of the mill levy in the charter, we
can issue only a limited tax bond. Mr. Moore suggested that
net operating income should provide 125 coverage. Coverage
factor should allow us to make minor capital improvements or
pay as you go basis. He stated tnat the difference in A and
AA rate is .10 to .257 in interest cost.
Mr. Banner advised the Council that the new facilities
will add some operating; expenses estimated from w30,000.00 to
$250,000.00 per year.
Mr. Moore sugr.-ested a 20 year bond callable in 10 years
at par. This would provide for level pay out of the bond issue.
For an issue o£ '"3,200,000.00, a total of operating and debt
costs approximately;$525,000.00 , therefore we would need approx-
• imately $"600,000.00 gross water revenue. In order to retain
this figure, we would need approximately 25% increase to get it.
• Mr. Moore suggested that the City pass a resolution that we
will raise water rates up to accomplish this. He added further
that an issue of $4,200,000.00, a gross revenue of 4,,690,000.00
per year, or arproximately a 401 increase.
Mr. Banner stated that we should not specify a definite
rate increase publicly because the actual % will vary in act-
uality.
He stated that the system he is recommending should be good
for 17 years.
During the discussion, Mr. Moore and Mr. Banner stated the
25% average growth of the City at 51 per ,year will allow consid-
erable money for minor capital improvements and water rights.
Mr. Banner broke down the $3,200,000.00 issue as follows:
$1,256,000.00
1,416,000.00
156,000.00
Distribution System
Treatment Plant
Repairs to existing facilities
end the remainder is unknown at this time.
Mr. Moore discussed some on the sewer bonds and recommended
an advance refund of the existing $270,000.00 bonds to get rid
of the existing ordinance. We do not have s rating on sewer
bonds but expect we could get an A rating. The existing ordinance
require 150 coverage while we only need 13010 coverage.
Mayor Johnson stated that we need both water and sewer con-
struction concurrently, but stated that water should come
first and then sewer.
Mr. Moore stated that the bond issue could be made within
two months of each other.
• Mr. Banner stated that he does not have the sewer estimates
as yet, but that it could go as high as $2,000,000.00
In relation to the bond issue, Mr. Moore stated that the call
feature in the bonds provides for all bonds callable even on the
• first year and we will have to out a premium provision on the
next 10 years or callable at par from the loth year on. He
also advised that we take the 15 year levy limitation off our
water bonds and recommended that the City be the paying agent.
There being no further discussion, President Ward Fischer
announced that the Water Board would meet next Monday, October
19, 1964, at 7:30 P.M., and the Board adjourned.
Secretary
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