Insurance quote for building higher than expected

Initial estimates for insuring the city-owned Hillsboro Business Development Complex came in higher than hoped, prompting the Hillsboro City Council to ask at its April 3 meeting to see higher deductibles in order to lower the premium.

With council support, Mayor Delores Dalke had asked IMA, the city?s insurance provider, to bring prices to the meeting because the structure has been uninsured since the city purchased it from Dairy Farmers of America about seven years ago.

The building currently provides space for several local businesses as well as the headquarters for the local police department and an office for the Kansas Highway Patrol.

Last month, USD 410 proposed using about one third of the building to relocate its central office and transportation services.

John Kullman, representing IMA, brought a premium quote of $23,166 to cover the buildings, which are valued at $8.84 million, and the city-owned gas pipeline, valued at $1 million.

Kullman said some cities in similar circumstances have opted for higher deductibles, then built up cash reserves to cover them. The council will consider that option before making a decision.

As for reaching a lease agreement with USD 410, Dalke said the city needs to determine the quality of the roof before it can suggest a lease rate.

?We need to take all those things into consideration because we don?t want to enter into a lease agreement that we?ll be sorry for later if our overhead is a lot more to maintain that building than what we?re getting in,? she said.

Tax abatement for CSI

Following a public hearing, the council approved an ordinance providing 10-year property-tax abatement for Container Services Inc. regarding its newly constructed 22,000-square-foot warehouse.

CSI co-owner Darrell Driggers said the business, which manufactures plastic food containers, is well on track to reach its abatement employment goal of 38 workers by the end of 10 years; the company currently has 32.

Jerry Rayl, the city?s financial adviser, recommended abatement based on the city?s cost-benefit formula. But he also suggested the city might want to review its policy about the duration of tax-abatement for any one business.

?When does the city take a position that they?ve contributed significantly to the continued growth of a business and stop giving abatement?? he asked. ?There?s several businesses in town that would love to have abatement on their property, but they are not eligible.?

Other issues

In other matters, the council:

  • reviewed Privitera's cost estimate for addressing areas of broken concrete on Ash Street from about First Street north to Third Street. He estimated the project, if it also included a small portion of Third Street, to cost $367,000.
    The council authorized Previtera to do the engineering work required ?to make this project happen.?

  • asked Previtera to make a preliminary estimate on the cost of creating a row of parallel parking spaces along the north edge of East Grand between Jefferson and Adams streets in front of the middle and high schools.
    The project, which could add 47 spaces, likely would need to be done in partnership with the school district to make it affordable, council members said.

  • discussed the county?s decision to charge its normal fee of $40 per ton for construction and demolition waste collected during the city?s annual cleanup week. Previously, the county did not charge cities during cleanup week.
    ?We?ll have to clean up C&D separately from other things that are put out so we don?t get charged ($40 a ton for mixing C&D with other trash items),? Dalke said.
    The mayor and council agreed it was important to haul away C&D material for residents.
    ?What?s the point of having clean-up week if we?re not going to clean up the town?? Dalke asked.

  • discussed what to do about the city-owned message sign that sits along U.S. Highway 56. Dalke said it?s difficult to change the removable letters on the sign when the surrounding grounds are muddy, and too often the message is not kept current.
    Dalke said a computerized sign could be changed from city hall, but such a sign would cost around $35,000. The council agreed that would be too much for the city to spend.
    Another idea was to move the sign to a more accessible location, or to see if there was interest by other parties to help fund a computerized sign.

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