Refinancing the city’s water plant loan will save Iola $748,000 over the remaining 14 years of the loan’s repayment.
Kevin Cowan, an attorney from Gilmore & Bell of Wichita, told Iola City Council members Monday that the city will pay a 2.3 percent interest rate over the life of the loan.
Council members unanimously approved the sale of about $7.4 million in general obligation bonds to Stifel, Nicolaus and Co. of St. Louis, with expected interest cost of $1,219,852 over the life of the loan, the lowest of three bids.
Cowan noted that the low interest rate was made possible in part because the city’s purchase of bond insurance. The bond insurance — costing about $87,500 — was necessary because Iola received only a BBB credit rating from Standard and Poors, which looks at a borrower’s financial outlook and its ability to repay loans. Iola was the only community rated by S & P at anything lower than an A rating, council members noted.
Cowan said it was only conjecture on his part to determine how much the city would have paid without the insurance and a BBB rating, but that one of the three bids was about $600,000 more expensive than the other two. He surmised that the most expensive bid may have taken into account the BBB rating without bond insurance.
COUNCIL members will decide in the coming weeks whether fees charged for specific city services should change.
They discussed at length some of the fees, such as the $10 fee assessed for accident reports from Iola Police Department; the estimated $500 to $750 paid for utility hookups and other permits to build a new house; and the cost to license dogs and cats.
City Administrator Carl Slaugh fielded questions about the fees.
Councilman Steve French suggested the city add a dollar or two to the annual dog and cat license fees, using added proceeds to maintain a dog park when it is built. Council members were scheduled to discuss the dog park at length at Monday’s meeting, but those discussions were until the council’s Jan. 23 meeting, Mayor Bill Shirley said.
Council member Beverly Franklin, meanwhile, said the city should look at cutting utility connection fees and other permits for new construction as a means to spur new construction.
“That’s what we need — new housing,” she said.
Ken Rowe, meanwhile, pressed Slaugh about fees charged for those getting copies of accident reports. The city charges $10 for such reports, while the Allen County Sheriff’s Department charges only $3.
Rowe noted that some administrative policies differ from municipal codes adopted by the city en masse. Such discrepancies are ones Slaugh said he would investigate and bring back to the council.
Rowe was not satisfied with the answer, noting a series of emails he exchanged with Slaugh in December regarding fees for accident reports. Rowe alleged that Slaugh had agreed to direct staff to charge fees based on municipal codes rather than administrative policy.
That nothing had changed in the time since the emails was “very misleading” on Slaugh’s behalf, Rowe contended.
Rowe also expressed concern about the city’s code enforcement fees and policy, relaying a conversation he had with one contractor who contended Iola is one of the most difficult city to work with.
That opinion was countered by Council member Joel Wicoff and Code Enforcement Officer Jeff Bauer.
