HomeMy WebLinkAbout03-08-93 Personnel & Finance Committee Report
PERSONNEL AND FINANCE
To the Common Council of the City of South Bend:
The March 8, 1993 , meeting of the Personnel and Finance
Committee was called to order at 4 :50 p.m. in the Council
Informal Meeting Room by it's Chairperson, Council Member
Ann Puzzello.
Persons in attendance included Council Members: Luecke,
Washington, Kelly, Puzzello, Slavinskas, Zakrzewski, Duda,
Ladewski, Kevin Horton, Jeff Rinard, Jack Dillon, Bob Nagle,
Don Porter, and Kathleen Cekanski-Farrand.
Council Member Puzzello noted that the first meeting on the
agenda was to review Resolution No. 93-23 which would
authorize temporary transfers of vital funds from various
funds to various other funds.
Kevin Horton, the City Controller, then provided a hand-out
which he reviewed (copy attached) . The first were the 1993
projected ending balances from the General Fund by month,
the second was projected ending cash balances by month for
1993 for the Park Maintenance Fund, followed by a series of
graphs showing ending cash and investments by funds.
Mr. Horton noted that this is the first time under Mayor
Kernan that the City will not utilize the Tax Anticipation
Warrant procedure. As a result, the City will save the cost
of issuance and the cost of borrowing, by better cash
management. As a result, temporary transfers should save
the City between $75, 000. 00 to $80, 000. 00. State Law
requires and restricts the City to investments in
Certificates of Deposits and Treasury Notes. He also noted
that the City would pay back interest on an average daily
balance that the Council would have received prior to the
transfer.
The total amount to be transferred would be $7, 600, 000. 00.
Mr. Horton also noted that last year the City borrowed 5.5
million dollars through the tax anticipation warrant process
which cost approximately $23 , 000. 00 in issuing costs.
Following further discussion, Council Member Ladewski made a
motion seconded by Council Member Zakrzewski that Resolution
93-23 be recommended favorably to Council. The motion
passed.
Council Member Puzzello then noted that the City
Administration is requesting a Suspension of the Rules to
hear Bill No. 19-23 which is the Issuance of Revenue Bonds
to refund outstanding sewage works bonds of the City.
Mr. Horton noted that the bonds were issued at a rate of 7
1/2% were rated "BAA" . Under the new issuance, if approved
by the Council, they would be insured and would be rated
"AAA" . The bonds may be offered at a 5% interest rate.
Through this process the $525, 000. 00 in escrow reserves
would also be permitted for sewage works construction
projects. The overall combined savings through this issuance
of revenue bonds should save the City approximately
$1, 000, 000. 00. The Committee complimented Mr. Horton, Mr.
Dillon and their respective staffs for this savings.
The then reviewed the Substitute Bill 19-93 along with the
draft of that Bill showing the specific changes to it. It
was also noted that there is a 1.25% coverage rate ratio
which is required mandating that the City maintain rates for
the sewage works that are reasonable in light of the bonds.
Following further discussion, Council Member Zakrzewski made
a motion seconded by Council Member Ladewski that Substitute
Bill No. 19-93 be recommended for a Suspension of the Rules
this evening to allow Public Hearing and Final Action and
that it be recommended favorably to the full Council. The
motion passed.
There being no further business to come before the
Committee, the meeting was adjourned at 5: 15 p.m.
Respectfully submitted,
Council Member Ann Puzzello, Chairperson
Personnel and Finance Committee
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