Hillsboro council on record against sales-tax increase- Resolution opposes financing strategy, not t

The Hillsboro City Council at its March 7 meeting formally communicated its opposition to the implementation of a one-cent county-wide sales-tax increase to pay for the construction of a new a justice center.

The council unanimously approved Resolution 2006-05, which states the city is not opposed to the construction of a new county jail, but that funding the project with the proposed sales-tax increase is “unadvisable and against the best interest of the citizens and patrons of the City of Hillsboro.”

In comments prior to the vote, Megan Kilgore, executive director of the Hillsboro Management Board, called Hillsboro “the hub of economic development in our county” and a 1-cent sales tax increase “would be the death of us-and it wouldn’t take 15 years to happen.”

Fifteen years is the length of the bond issue being considered for the project, the cost of which has been estimated at $11 million.

In her role with HMB, Kilgore works on behalf of the Chamber of Commerce and the Hillsboro Development Corp. She said the Chamber has specific concern about the impact of a sales tax increase on Hillsboro’s three automobile dealerships, but that other county business districts would suffer as well.

The Marion County Board of Commissioners has not yet decided to put the sales-tax initiative on the November ballot, but has asked Rep. Don Dahl to add Marion County to a state bill that would allow the commissioners to do so.

Kilgore was among a contingent from Hillsboro that attended the March 6 public hearing on the issue

“No one thinks the jail doesn’t need to be changed,” Kilgore said, adding that the issue is what kind of project is affordable and how should it be funded.

City Administrator Steve Garrett, who also attended the hearing, said one alternative funding method mentioned was an 8-mill increase in property taxes. The owner of a $100,000 house would pay $92 more per year.

Mayor Delores noted: “That’s still a big increase.”

Councilor Len Coryea, noting the projected annual cost of $153,000 to keep prisoners in a jail outside of county, said, “You could transport a lot of prisoners (for $11 million).”

Councilor Shelby Dirks said he hoped county leaders would consider scaling down the project as well as search for grants and other funding options that might be available.

Improvement estimates

City engineer Bob Previtera, of Reiss & Goodness Engineers, distributed preliminary estimates on three elements of a building project initiated by Tabor College.

At a Feb. 27 special session, Kirby Fadenrecht, vice president for business and finance at Tabor, presented plans for the construction of six student townhouses along Adams Street. He also inquired about city assistance for addressing drainage issues along Madison Street on the north edge of the campus.

Previtera estimated the cost of installing an underground storm water drainage system along Madison to be $52,000. He also estimated it would cost $232,000 to replace waterlines along Madison and Adams streets.

Before approving the project, the college and city will negotiate how much each entity would pay to complete the work. Tabor hopes to begin construction this summer.

Banking services

For the first time in years, the city has switched its banking services. The council accepted a bid from Central National Bank over a bid from longtime provider Emprise Bank and from Hillsboro State Bank.

With comparable interest rates offered by CNB and Emprise, the deciding factor, said Councilor Matt Hiebert when he made the motion, was CNB’s no-charge provision on direct deposits.

Insurance proposal

John Kullman, representing IMA, a municipal insurance company, said the city could benefit form declining premiums in the coming year.

Kullman presented an initial proposal for general and liability coverage. He noted a 16 percent reduction in the premium to $47,909 that covers a 27 percent increase in exposure.

Before the council will act on the IMA proposal, it will be revised to include coverage adjustments, including upgrades currently being done at the water-treatment plant.

Kullman said he would also check out rates from one other insurance carrier operating in the state.

Other business

approved two change orders for nonessential upgrades at the water treatment plant after hearing a projection from Don Hellar, project engineer from EBH & Associates, that the city would have up to $81,000 of discretionary funding remaining when the required work was complete.

One change was the addition of an additional chlorine line to help fight magnesium levels in the lake water at a cost of $1,000. The other change was adding peroxide-injection equipment.

Hellar presented a list of eight additional changes that have been considered for the plant. He made no other recommendation at this time.

approved pay estimates of $349,816 from Utility Contractors Inc. and $23,102 from EBH & Associates for work completed at the water plant.

approved a pay estimate of $227,513 from Carrothers Construction for work completed at the aquatic center.

agreed to pursue a lease opportunity with American Energies Corp. regarding the natural gas line the city acquired with the purchase of the former AMPI property. An initial proposal from AEC to pay $4,000 a year to lease the pipeline, plus a fee of 5 cents per thousand cubic feet for all gas transported through the leased facility, or a one-payment of $75,000 for the first 20-year term of the lease.

The council declined an inquiry from Atmos Energy to purchase the pipeline.

declared April as “Fair Housing Month” to meet the requirements of the Community Development Block Grant the city received to replace the waterline along Lincoln Street last summer.

approved a recommendation to purchase 50 chairs for the aquatic center for $6,095 from Lumitech Inc. rather than purchasing a lesser quality chair from Tropic Craft for $5,535.

approved a request from Tabor College to annex a 1.9-acre plot adjoining the southeast corner of the campus.

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