MINUTES OF MARCH 2, 2009

WORKSHOP MEETING OF THE ALLIANCE CITY COUNCIL

The meeting was called to order by President Benincasa at 6:30 P.M. Acting Council Clerk Zumbar read the public notice.

ROLL CALL: Alan Andreani, Roy Clunk, teve Okey, Phyllis Phillips, Roger Rhome, Sue Ryan, and Larry Thompson (arrived after roll call at 6:35 PM) present.

President Benincasa addressed the handling of public speaks during a workshop or special meeting according to Council rules and practices.

Councilman Rhome addressed the body as to his reason for calling the workshop meeting and asked Councilman Okey as the Chairman of the Finance Committee for information on financial impact of Ordinance 10-09.

Councilman Okey explained Ordinance 10-09 and his reasons for introducing the ordinance.

Councilman Okey asked Auditor Knowles for information on the Water Plant bonds and payments.

Auditor Knowles reported on the bond information and payments & rate covenants as well as water revenue.

Safety Service Director Blaser reported on an estimated average residential customer bill and the estimated cost effect of Ordinance 10-09.  Director Blaser also reported on an estimated cost from the billing company for computer modifications to enact the credit called for in Ordinance 10-09.

Director Blaser reported that based upon the estimates, bond covenants and payments could be made if Ordinance 10-09 were to be enacted but cautioned that the City was already experiencing increased chemical costs and those costs were compounded by increased treatment.  There is also increased testing costs and Powdered Activated Carbon that the City is using to combat the problem.

Director Blaser advised Council about the refinance of 2008 and the State Auditor requiring re-allocation of interest income caused bonds ratios to fall below covenants required in bonds for 2008 but refinance and re-allocation should not give rise to bond covenant default.

Councilman Clunk questioned the average customer bill for water usage and it was reported that the monthly average residential customer water bill is about $27.00 per month.

Councilman Andreani expressed concern over future water treatment projects and Director Blaser reported on such projects and items already scheduled for replacement.

Councilperson Phillips questioned if the City has funds available now and if the payment could be made with funds currently available.  Director Blaser reported that it could be done but it could cause rate review and possible future rate increases especially when combined with other economic factors such as increased costs as set forth earlier.

Councilman Thompson stated that Citizens have put up with water concerns and the City is attempting to fix the situation.  Councilman Thompson questioned what the City is doing right now for the citizens on this water issue.

Councilman Rhome questioned the safety of the City water and Health Commissioner Flint reported there is absolutely no public health hazard associated with consumption of City water.

Councilperson Ryan questioned whether a precedent would be set by passage of ordinance 10-09 and the 10% credit.   Councilperson Ryan noted that citizens who are not drinking the water choosing to purchase bottled drinking water already experience a bill reduction due to their reduced usage.

ADJOURNMENT: Noting no further business to come before this Council at the workshop session, President Benincasa adjourned the workshop meeting at  6:55 P.M.

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JOHN BENINCASA, PRESIDENT                                   GERARD YOST, COUNCIL CLERK