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'CITY OF SOUTH BEND I OFFICE OF THE CLERK added to the average person and those are my reasons. I hope the Council will think about those and think about better ways to fund it than the average population. Committee Chair Teshka gave the floor to Mr. Horvath for response. Mr. Horvath stated, I appreciate both of your comments. We've talked before and they are both right. We've got a hurting community and about fifty-four percent(54%) is below ALICE which looks at basic survival needs that people have. That's why when we've talked before, it is something that's important for us to look at income-based rates and to try to find ways to do differential rates on our utilities. That is something that we've started to do. There are a number of different pieces that we've got to put in place so it's not going to be a quick process but over the next number of months we will be working on that. Of course there is a financial piece to it, too, to try and figure out different ways to structure it so that we can ultimately still fund it. There is also a legal piece to it to make sure we can get it done,legally,in Indiana. This has only been done once in the country and not in Indiana. There are a couple of other folks looking at it right now so it is something the IURC is going to need to figure out what they're going to do with the program but they haven't yet. That will mostly be a timing challenge. He continued, I think that is an important next step we have to do. We will look at all of our utility rates, solid waste, waste water, water, storm water all together. In terms of assistance, there are some places we send folks for customer assistance but we do not have any City program for customer assistance. There is no ordinance enabling any customer assistance programs so if we went to an income-based rate, that would be, essentially, our assistance program. In terms of attaching this to property tax, the way this ordinance is structured, it will not attach to property taxes. This is structured so it will be in the user fees and attached to the sewer and water bills. It will be like the other utilities. Same thing with water, sewer and solid waste, if you don't pay that bill we don't take that house or collect on your taxes. He went on,We haven't issued bonds since I've been here other than refunding bonds. The reason to refund bonds at that time was because we had an opportunity for a call,the rates were lower and so we saved significant dollars doing a refund.That is a possibility that they will have specific call dates but I don't think we have any existing ones with call dates we can refund right now. So I would have to have bond counsel to answer questions more specifically but I think what would happen would be if you do an early call, you'd pay a penalty so you would be double paying for a period of time until the call date. That probably won't make sense to do unless the rates were so drastically different. There is always an opportunity to refund in the future. However, it's not like you're mortgaging your house. It seems like we would go through with a new bond issue. But if you're going to do a bond, something has to back that bond. You can't just do a bond without anything there. So utility fees can back bonds. A storm water fee could back a bond. Typically, they would have a lot of difficulty with giving us a bond for storm water if we haven't established that fund to show them we have a consistent amount of money coming in. So if we are going to do that, we probably need to back it with something else like the General Fund or something else. Committee Chair Teshka asked, Do any rate increases have to come before Council? Mr. Horvath replied, Absolutely. Committee Chair Teshka stated, So that is our assurance for the escalation piece. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 3