Published: September 24, 2008 09:56 am      

City considers short-term loan

Funds needed to cover year-end bills

DANVILLE — Danville Mayor Scott Eisenhauer said Tuesday shaky national financial markets will not affect the city’s ability to borrow $650,000 to cover a lean stretch in the budget.

“We’re not concerned about that at all,” he said following a Public Services meeting in which aldermen approved the plan and sent it to the full council to consider Oct. 7. “It’s not like we’re not going to have the money at the end of the year.”

City Comptroller Gayle Brandon said the shortfall in funding at the end of the calendar year is an accounting issue as several large expenditures, including $1.1 million in rent for the Public Services Building and around $800,000 in general liability insurance, come due at once.

Meanwhile, the city doesn’t get state income tax money until the start of the new year.

“If the state’s on time this year, we’ll be able to (pay the loan) in January,” she said, adding the loan would be put out for bid.

Ward 7 Alderman Ron Candido questioned whether the city should consider restructuring the timetable of some of the bills so they could be paid off when city coffers are more comfortably full.

Eisenhauer explained the reason the year-end months were a stretch on the budget is because the Public Services Building payment is made in a lump sum in order to receive an approximate $21,000 discount on the overall amount due. He said that payment was cost-effective when compared to the loan, which he added was a better financing deal than a line of credit.

Committee Chairman Steve Nichols said, ideally, the city should not have to borrow just to meet the bills, but a goal of starting the new budget year with a $1.5 million cushion couldn’t be met because of several unforeseen expenditures.

Eisenhauer said following the meeting that one of those expenses included repairs to the stairwell in the city’s parking garage.

“Our intention is never to drag (the loan payments) out until March or April,” he said.

Zoning rewrite

City officials plan to give the public plenty of opportunities to review the first comprehensive change in the city’s zoning ordinances in years.

Public Development Director John Heckler said he would conduct at least two meetings for public input and plans to conduct special information sessions for local Realtors and appraisers. He said the city would announce times and dates in the near future, with a revised document expected to be presented to the Planning and Zoning Committee on Nov. 6. Letters announcing the meetings will be sent to all Danville addresses.

“It’s a very significant document for our department and to the city,” he said.

“We went over it with a fine-toothed comb,” said Planning and Zoning Manager Chris Milliken, author of the rewrite, noting city approval would be the culmination of 18 months of research on the heels of the city’s adoption of its comprehensive plan. “It will be a substantial upgrade to what we have now.”

Heckler said a detailed zoning ordinance update was long overdue, explaining current ordinances have simply been rewritten or changed over time, making the document “fragmented.”

“He did not update it,” he said of Milliken’s final version, “what he did was re-write it.” The end result is a “modernized” zoning code this is “more defensible in court.”

Ladder down

Public Safety Director Larry Thomason told aldermen the fire department’s ladder truck was in need of repair and it was showing signs of overuse.

The 75-foot ladder still raises, but the turning mechanism is broken. The truck was purchased 10 years ago as a demonstration model and is housed in Station 1.

“It goes out on regular calls as an engine would,” Thomason said. “It’s not designed for everyday work.”

He said the repairs should not take the truck out of service for long, but stressed the need for the city to plan for purchasing a replacement in the future.

“This truck is vital to our downtown area,” he said.

Nichols said city officials knew at the time the ladder truck was not a perfect purchase due to its chassis type. “It was available and they gave us a good deal,” he said.

Eisenhauer said the city was currently working on “specs” to use when purchasing equipment and collecting data to determine the life span of city vehicles. He said the added information will aid officials, “before being forced into making poor purchasing decisions.”

New ‘business’

Committee members sent forward to the full council a redevelopment agreement for the new Social Security building being constructed 400 N. Vermilion St.

The agreement, which public development department staff said was similar to other recent Tax Increment Financing deals, would defer 50 percent of taxes for 10 years. The property is being developed by GSLK Danville, LLC, which will lease the offices to the federal government.

“We hope this will trigger other projects in the area,” Milliken said.

Candido, while supporting the project’s benefits to Danville, said he didn’t understand why constructing the building outright wouldn’t be cheaper for the federal government because under than scenario it wouldn’t pay taxes on the property. He said he had contacted Congressman Tim Johnson over the issue.

“It doesn’t make sense,” he said. “It’s another example of why we’re wasting our money.”

In other business

-- Information Services Director Teresa Winn said some city employees were nearly finished testing a new computer system that could save substantial money in the future. The system uses a centralized network that allows updates of the entire system without changing out software on individual computers. She said the city would be using the savings to update its number of laptops, allowing for more employee mobility.

“The idea that a computer only lasts three years,” Winn said, “that’s not necessarily true when it comes to these boxes.”

Eisenhauer said the advance was due to the city’s investment in technology upgrades in recent years.

“This is one of the steps that will save us money,” he said.

-- The committee heard information on the development of a new recreational area for dogs at Epensheid Park. A resident is working on a plan to make the park a reality.

-- Candido asked how the “incentive” money offered to Village Mall would be used after anchor Steve and Barry’s announced it would be leaving.

Eisenhauer explained the incentives did not go directly to the store, but to mall officials who can use it to help attract new business there.

“There wasn’t any loss factor in it at all,” the mayor said. “It certainly has enlightened us on how we write future documents. That was the intention of putting it in the name of the mall, so there’s some incentive they’re able to use to entice another retailer in.”