With a $13 million road rebuild looming, Iola City Council members discussed how they plan to pay for it at Monday night’s meeting.
A charter ordinance allowing the city to incur that much debt took center stage.
The plan is to utilize sales tax revenues to retire general obligation bonds over 30 years for the rebuild, City Administrator Matt Rehder noted. The work is expected to begin in either 2024 or 2025.
While the roadwork costs have been pegged at about $9 million, the city must also tack on 10% for engineering costs, plus additional contingency funding authority, coming to the $13 million figure, Assistant City Administrator Corey Schinstock said.
The charter ordinance is necessary, Rehder explained, because the state otherwise limits cities from issuing bonds costing more than 30% of a city’s assessed valuation. A $13 million project is equivalent to about 40% of Iola’s $32 million assessed valuation.
The ordinance was approved, but not without extensive debate.
Councilman Carl Slaugh objected to the cost, singling out ramifications of raising the debt limit.
“If you’re building a house, and the cost exceeds what you can pay, you generally change the scope of the project,” Slaugh said. “I’m wondering why we don’t change the scope and scale it back to what fits the limits instead of changing our charter ordinance.”
Slaugh suggested doing the project in stages, targeting the worst parts for the first stage then doing the other half after the first project is paid for in 15 years.
Other Council members disagreed, noting a recent geological survey indicated the randomness of subgrade failures along the entire stretch of the highway.
“How do you determine what half to fix,” Councilman Mark Peters replied. “We need to do it all at once to get it done.”
“It’s not like from point A to point G is the worst,” Mayor Steve French added.
“It may look bad as far as core drillings, but it has held up for the last 50 years,” Slaugh responded. “Only a certain part of the project doesn’t hold up. I see this as just another red flag without having something that shows a little more detail, how we’re going to pay for this, and what kind of impact it will have on similar projects.”
The city can afford the anticipated $500,000 annual bond payments with its sales taxes, particularly since Iola no longer shares half of its sales tax revenues with Allen County Regional Hospital.
“Maybe we should go to the hospital to ask them to help pay for our repairs,” Slaugh quipped, drawing a round of laughter from the other Council members.
Councilman Nich Lohman noted Iola will soon be out from under the $600,000 annual payments that funded the city’s water plant, although Rehder pointed out street and alley and water projects must be kept separate.
Even though the city will no longer have water plant payments after 2025, “we have plans for that money as well,” Rehder said. “We need to maintain what’s already there.”
Councilman Josiah D’Albini asked about utilizing KDOT funds to help pay for the project.
The city applied once, but was denied, Rehder noted, and plans to apply again.
There remain several steps before any kind of project begins, including public engagement, Rehder said.
Because Monday’s vote was for a charter ordinance, it required a two-thirds majority with French allowed to vote as well.
The measure did so, passing 7-1, with Slaugh casting the only dissenting vote. Councilwoman Joelle Shallah was absent.
SLAUGH also cast the sole nay vote on an ordinance allowing business owners to utilize metal storage containers on their properties, provided they have enough space on their land and are not located immediately next to residential areas.
At their Oct. 24 meeting, Code Enforcement Officer Gregg Hutton told Council members the city still possessed authority to reject requests for such containers to ensure business owners don’t take unfair advantage and stack multiple containers together.
That was not enough to convince Slaugh to support the ordinance.
“I feel like sometimes our desire to make things work for certain businesses in the community, we little by little relax our standards,’ he said. “These shipping containers do not look appropriate. That’s why I’m opposed. There ought to be permanent structures and not shipping containers.”
“Would you feel the same way about a shed?” French asked.
“A shed looks more like a house with a roof,” Slaugh replied.
“So it’s simply aesthetics,” the mayor responded.
“I’m not sure the value of each home is simply aesthetics,” Slaugh said. “When I see those shipping containers, they do not have a regular curb appeal.”
Had they rejected the ordinance, the city would have had to do away with two shipping containers it uses, one near the city warehouse; the other at Highland Cemetery.
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