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HomeMy Public PortalAbout05-03-1993 239 PROCEEDINGS OF THE COMMON COUNCIL OF THE ' CITY_-OF RICHMOND, INDIANA MONDAY,MAY_-1-1993 1 The Common Council of the City of Richmond, Indiana met in regular session at 7:30 p.m. Monday, May 3, 2 1993, in the Council Chambers in said City. President Lundy presided with the following Councilmembers 3 present:Elstro, Brookbank, Donat, McBride, Parker,Allen, Dickman and Hutton.The following business was 4 had to-wit: 5 6 PLEDGE OF ALLEGIANCE 7 8 PRAYER BY COUNCILMEMBER HUTTON 9 10 ROLL CALL • 11 12 Nine present. 13 14 APPROVAL OF MINUTES OF APRIL 19.1993 15 16 Councilmember McBride moved to approve the minutes of the previous meeting as prepared,seconded by 17 Councilmember Brookbank and by unanimous voice vote the motion was carried. 18 19 COMMUNICATIONS FROM THE MAYOR 20 21 Mayor Roger Cornett called attention to the newspaper article recently about the Greyhound bus stop, 22 noting that a city employee who took a recent trip and was unloaded in a parking lot told the mayor that it 23 had been an unpleasant experience. Then, in another meeting with Dana Weigle, the issue had been 24 brought up and a meeting with Weigle and Greyhound resulted in solving the problem by finding a suitable 25 location. The Mayor said that as a result,travelers will have a pleasant experience in getting on and off the 26 bus here in Richmond. He was pleased to report that through the cooperation of private citizens and the 27 interest of city employees yet another problem had been solved. 28 29 PRESENTATIONS OF REMONSTRANCES. PETITIONS AND MEMORIALS 30 31 Councilmember McBride made a motion that the next meeting be moved to Tuesday, May 18, since it 32 conflicts with the dinner planned for George "Grill" Griffith, Richmond High School Boys Basketball Coach 33 who is retiring from coaching,second by Councilmember Dickman and carried by a unanimous voice vote. 34 35 REPORT FROM BOARD OF PUBLIC WORKS AND SAFETY 36 37 Councilmember McBride commented that the crossing on N.W. L is so deplorable that Belden employees 38 are petitioning for the extension of Industries Road. He added that the one on South L is not much better. He 39 asked Earnest Jarvis, director of Public Works & Safety, why the City didn't just blacktop over it. Jarvis 40 responded that it looked like the City was close to doing just that, unfortunately, since it looked like it was 41 going to lose that railroad. He said he would look into the situation. Minutes of the April 22 meeting of the 42 Board of Works were included in the Council packets. 43 44 REPORTS FROM SPECIAL COMMITTEES 45 46 No reports were presented. 47 48 REPORTS FROM STANDING COMMITTEES 49 50 Councilmember Donat said she attended the annual meeting of HELP The Animals Inc. and learned that a 51 topic of concern was that the group does not have a contract with the City for 1993. She reported that she 52 called the department of law to inquire about it. City Attorney Thomas Milligan commented that the 53 contractual arrangement continues until a new contract is in place. He added that the new contract will be 54 bid but until such time the new contract is let the existing contract continues. He noted that he did not know 55 at this time when that might be negotiated.She said she would report that information to the group's director. 56 57 58 Another concern of Councilmember Donat was that almost three fourths of the animals taken care of in the 59 shelter in 1992 were euthanized.She added that already,within the first three months of 1993,three fifths of 60 the animals have had to be euthanized. She said last year when Common Council addressed the issue of 61 tags for dogs and cats members had talked about whether or not to build an incentive into the ordinance for 62 spaying and neutering and the decision was made to make an across the board $4 charge. She added that 63 she had talked with Janet Hibner in the department of law and asked her to prepare another ordinance so 64 that issue might be addressed.She invited members of the audience to make a trip to the shelter to see how 65 the animals are housed and cared for. 240 • Common Council Minutes Cont'd May 3, 1993 • Page 2 • • • . , In reporting on the Reid Hospital Board of Directors meeting, Councilmember Brookbank said since the closing of Jenkins Hall four weeks ago only four residents have not yet been placed in other housing facilities. She added that it has taken only four weeks to do what Board members thought might possibly take almost six months. She said the Board had approved the purchase of a$94,000 computer.scheduling system for surgical services which will be beneficial to the surgeons and the scheduling. She also noted that the nurses'shortage is down to zero and that the incentive bonuses offered during the time of shortage are no longer being offered. • REPORTS FROM OTHER COUNCIL COMMITTEES 1. 1 No reports were presented. 1 1 ORDINANCES 1 1- ORDINANCES ON FIRST READING 1 Councilmember Brookbank moved to suspend the rules and read on first reading by title only Ordinances 1: No. 31, 32, 33,34 and 35 - 1993, second by Councilmember McBride and carried by a unanimous voice 1• vote. 2. 2 ORDINANCE NO. 31 -1993 2 2 The Clerk read Ordinance No. 31 - 1993 - AN APPROPRIATION=ORDINANCE AMENDING THE 1993 2 BUDGET 2 2° City Controller Dennis Grimes explained that the ordinance had been advertized in the April 23 issue of the 2 Palladium-Item. He further noted that there was a need to remove and replace the underground storage 2: tanks at the airport at an estimated cost of slightly under $100,000. He added that additional revenue 2° sources had been identified in the general fund by the virtue of the new TCI franchise agreement. He noted 3. that previously the City's payments from TCI were made on an annual basis after the close of the year but 3 the through the new arrangement those payments are now to be made 45 days after the closing of each 3 quarter.Therefore, in 1993 the City will receive three quarterly payments which is above what was budgeted 3• in the 1993 budget. He explained that the City budgeted for what it anticiapted receiving in 1993 from the 3' 1992 revenues, but not the 1993 payments. He explained that the city received one payment in the amount 3 of$38,552 last week in addition to the$50,000 prepayment in January. 3• - 3' In answer to Councilmember Allen's question,•Jarvis said there are three storage tanks in the ground there 3: at the airport now. He noted that those•are to be removed and replaced with two 10,000 fiberglass gallon 3° tanks, adding that he believes the old ones have been there since 1968. He:said one of thetanks will be for 40 jet fuel and the other for the aviation lowlead, adding that these include a lot of hardware, filter systems, 4 safety devices and those types of things that go with the aviation fuel system. He said six bids had been 4 received,ranging in price from$91,000 to$174,000. • Councilmember Hutton said she was confused on the extra $100,000. Grimes explained that the City had 4. budgeted the$90,000 in receipts in the 1993 budge from TCI. Normally, he said,this payment would not be 4° received until January of 1994; but the new franchise agreement arranged for the payment 45-days after the 4 closing of each quarter. Councilmember Hutton than asked if that meant the City was getting an extra 4: $100,000 and Grimes answered that that was correct. In answer to a question-by Councilmember Elstro, 4° Jarvis said the $5,000 spent earlier was to hire a contractor out of Indianapolis because it was determined 50 that this technical type of a project needed an expert. 5 5 Councilmember Parker moved to amend the ordinance so that it would read "for the removal and installtion 5 of the airport underground storage tanks",second by Councilmember Dickman and carried by a unanimous 5, voice vote. 5 5° Councilmember McBride moved to suspend the rules and advance Ordinance•No. 31 - 1993 to second 5 reading and read by title only,second by Councilmember Donat and carried by a unanimous voice vote. 5: 5° The Clerk read Ordinance No.31 -1993 on second reading. - 69 6 President Lundy declared Ordinance No.31 -1993 on public hearing.There being no comment either for or 6 against the ordinance Councilmember.Dickman moved for engrossment, second'by Councilmember Donat 6 and carried by a unanimous voice vote: - 6 • 6 . . ., . • • • , 241 Common Council Minutes Cont'd May 3, 1993 Page 3 • • 1 Councilmember Brookbank moved to suspend the rules and advance Ordinance No. 31 - 1993 to third and 2 final reading and read by title only, second by Councilmember McBride and carried by a unanimous voice 3 vote. 4 5 The Clerk read Ordinance No.31 -1993 on third reading. 6 7 Ordinance No.31 -1993 was adopted on the following call of the roll: 8 9 Ayes:Elstro, Brookbank, Donat, McBride,Parker,Allen, Dickman, Hutton and Lundy(9) 10 Nays:None 11 12 ORDINANCE NO.32-1993 13 • 14 The Clerk read Ordinance No. 32 - 1993 - A SPECIAL ORDINANCE AUTHORIZING THE APPROVAL OF 15 STATEMENTS OF BENEFITS FOR PROPERTY OWNERS APPLYING FOR DEDUCTIONS UNDER I.C. 6- 16 1.1 -12.1 17 18 Councilmember Parker explained that the tax abatement committee met and determined that the companies • 19 named in the ordinance meet•the criteria to the.letter of the law and recommends their approval. In answer to 20 Councilmember Elstro's question, Councilmember Parker said the owners bring them to the tax abatement 21 committee which reviews them and makes a determination as to whether or not they qualify. If they do qualify 22 the requests are brought to the Common Council where they can be approved or denied. If they are 23 approved they go to the State Board of Tax Examiners which makes the final determination whether or not 24 they meet the criteria and can be abated. Councilmember Elstro asked who was responsible for monitoring 25 the project. Councilmember Parker said when the project first begain it was monitored every year at at this 26 time no one is monitoring it. He added that it is a concern to the tax abatement committee because there is 27 no true monitoring of the jobs created. 28 29 Director of Economic Development Jim Kinnett explained that none of the follow up had been done. He 30 added that a year and a half ago the state had implemented new legislation and changed some of rules 31 which required a form to be filled out for the interpretation of jobs. He said the problem that was created was 32 that it gave no mechanism to the community to actually get into the process of verifying the investment or the 33 job. 34 35 Councilmember Elstro asked how businesses found out about the tax abatement program and Kinnett 36 answered that the information was given through the City's marketing program and used to hopefully entice 37 them to make additional investments in their machinery and equipment as well as their facilities. 38 39 40 Councilmember Parker, noting that it was a personal concern, said he has contacted the Wayne County 41 Auditor to find out how much has been totally abated over the years and he will pass that information on to 42 the other Council members. He said it is a sizeable amount that has been abated and taken off the tax roles. 43 He reminded the members, however, that they must bear in mind that this is one of the few things the City 44 gives to the existing businesses as an incentive or as an abatement but he wasn't saying that was good or 45 bad. Kinnett added that there is significant use of this program by existing companies and it is the one 46 program that is as well defined for existing companies as it is for any other type of investor. 47 48 Answering a question posed by Councilmember Elstro, Councilmember Parker said he was going only from 49 memory, but he thinks the City has abated total revenue of about$1,900,000. Milligan said that on a frozen 50 levy the City can raise only so many dollars and he wanted to make clear that this would not increase the 51 total amount of income to the City if all abatements were off. He added that suggesting that the City could 52 increase its total income as a result of eliminating abatements or decreasing them is not logically an 53 acceptable proposition. Kinnett explained that the taxes that are being abated are not existing taxes, but 54 future taxes which means those that are not presently in place at this time. He added that the City is not 55 allowed to abate taxes on property or real property already on tax roles. He said competitiors throughout the 56 multi-state area have programs equal to this and the City does notted to look at it with wide open eyes as it 57 approaches future development in the area. 58 59 Councilmember Brookbank moved to suspend the rules and advance Ordinance No. 32 - 1993 to second 60 reading and read by title only,second by Councilmember McBride and carried by a unanimous voice vote. 61 62 The Clerk read Ordinance No.32-1993 on second reading. 63 64 President Lundy declared the ordinance on public hearing.There being no comment either for or against the 65 ordinance, Councilmember McBride moved for engrossment, second by Councilmember Dickman and carried by a unanimous voice vote. Common Council Minutes Cont'd • May 3, 1993 • • •,` _ '• t 1 • • • • 1 Councilmember Brookbank moved to suspend the rules and advance Ordinance,No.32- 1993 to third and 2 final reading and read by title only, second by Councilmember McBride•and carried by a'unanimous voice c vote. . • 4 I • • - • The Clerk read Ordinance No.32-1993 on third reading. • E . 7 Councilmember Allen pointed out that it is an advantage to have these abatements. . Ordinance No.32-1993 was adopted on the following call of the•roll: 1 . . 1 Ayes:Brookbank, Donat, McBride,Parker,Allen, Dickman,Hutton and Lundy(8) 1 Nays:Elstro(1) • 1 • 1 ORDINANCE NO.33-1993 1 • 1 The Clerk, read Ordinance No. 33 - 1993 - A SPECIAL ORDINANCE IN SUPPORT OF THE HOME 1 OWNERSHIP OPPORTUNITY PROGRAM OF THE HOUSING AUTHORITY OF THE CITY.OF RICHMOND 1: • . . 1' Pres,ident Lundy announced that Keith McGathey, executive'director of the Richmond Housing Authority, 2b was in the audience and asked him to step to the lecturn. She then asked.City Clerk Norma Carnes to read 2 the ordinance in its entirety. (Check file in Clerk's office). 2. 2 President Lundy explained that the ordinance will pave the way to give home ownership to citizens with low 2• to moderate incomes through the Housing Authority of the City of Richmond which will continue to put 2 houses in Richmond in all sections. She commended the Housing Authority for.its actions.Councilmember 2: McBride noted that this ordinance is subject to the approval of the United States Department of Housing and 2 Urban Development. Mayor Roger Cornett said this ordinance will allow the City to use the land that was set 2: aside for the Infill Housing Program. The grant for that program was never awarded the City because the 2' right number of people couldn't be found with the right incomes to fulfill al the rules and regulations. He 3« added that this is a totally different program and is administered.through the Richmond Housing Authority 3 using HUD funds. 3. 3 Councilmember McBride moved to suspend the rules and advance Ordinance No. 33 - 1993 to second 3 reading and read by title only,second by Councilmember Dickman and carried by a unanimous voice vote. 3 3: The Clerk read Ordinance No.33-1993 on second reading. 3 3: President Lundy declared Ordinance No.33-- 1993 on public hearing.There being no comment'either for or 3• against the ordinance, Councilmember Dickman moved for 1 engrossment, second by •.Councilmember 4F McBride and carried by a unanimous voice vote. • 4 4 Councilmember Brookbank moved to suspend the rules and move Ordinance No.33- 1993 to third and final 4 reading and read by title only,second by Councilmember.McBride and carried by aunanimous voice vote. The Clerk read Ordinance No.33-1993 on third reading. 4:. 4 Ordinance No.33-1993 was adopted on the following call of the roll: 4- 4• Ayes:Elstro, Brookbank, Donat, McBride, Parker,Allen, Dickman, Hutton and.Lundy (9) 5t Nays:None 5 ' 5. ORDINANCE NO.34-1993 5 5' The Clerk read Ordinance No. 34- 1993 -AN APPROPRIATION ORDINANCE AUTHORIZING THE CITY 5 OF RICHMOND TO RECEIVE DONATIONS 5. 5 President Lundy.asked City Attorney Thomas Milligan to read the ordinance in its entirety. Milligan said this 5: is another ordinance which is used as an appropriation advice through state law, noting that the gifts were 5° made to the Richmond Police Department for various programs. S i 60 6 For,the canine project,for the purchase of dogs and the specialized training of personnel to utilize their 6 services,a$1,000 cash gift was donated by the J.M. Hutton Co: Inc. For the prime prevention project for the 6 purchase of specialized equipment;and signs cash gifts'of$50 each were:received from Big Blue Stores Inc. 6' and the Richmond Square Mall Merchants Association. . , 6 243 Common Council Minutes Cont'd May 3, 1993 • Paqe-5 1 Councilmember McBride moved to suspend the rules and advance Ordinance No. 34 - 1993 to second 2 reading and read by title only,second by Councilmember Brookbank and carried by a unanimous voice vote. 3 4 The Clerk read Ordinance No.34-1993 on second reading. 5 6 President Lundy declared the ordinance on public hearing. There being no comment either for or against 7 Ordinance No. 34 - 1993, Councilmember McBride moved for engrossment, second by Councilmember 8 Hutton and carried by a unanimous voice vote. 9 10 Councilmember Brookbank moved to suspend the rules and advance Ordinance No. 34- 1993 to third and 11 final reading and read by title only, second by Councilmember McBride and carried by a unanimous voice 12 vote. 13 14 The Clerk read Ordinance No.34-1993 on third reading. 15 16 Ordinance No.34-1993 was adopted on the following call of the roll: 17 18 Ayes:Elstro, Brookbank, Donat, McBride,Parker,Allen, Dickman, Hutton and Lundy(9) 19 Nays:None 20 21 ORDINANCE NO.35-1993 22 23 The Clerk read Ordinance No. 35 - 1993-A GENERAL ORDINANCE AUTHORIZING THE CREATION OF 24 A HOLDING CORPORATION TO OWN AND FINANCE A FULLY INTERACTIVE CABLE 25 COMMUNICATIONS AND CONTROL SYSTEM 26 27 Milligan explained this ordinance implements the request of the Richmond Power& Light Board of Directors 28 in the past month to the City to create a holding corporation and that would be a corporation that would 29 primarily be set up under Indiana law to issue revenue bonds backed by theicity's taxing power. The wholly 30 interactive cable system would be constructed by that holding corporation from the proceeds of the sale of 31 the bonds and it is indicated that the sale would have to be in the neighborhood of$6,900,000. The system 32 would then be leased to the City and Richmond would guarantee the bond service as well as all the trustee 33 fees from the net profits of the system in the event those profits would be insufficient to meet the bond 34 service requirements. 35 36 It also provides that the holding corporation would be instructed once the holding corporation is in existence 37 and has proceeded to start the bonding process that they are also requested to negotiation and obtain a 38 franchise for the operation of the cable communication system from the Board of Works and, after working 39 out the leases with the city it is anticipated, and this ordinance so provides, that the city will enter into a 40 contract with RP&L to operate the system on behalf of the City. 41 - 42 Councilmember Allen said besides the financial aspects,one of the things that needed to be considered was 43 the reduced bonding capacity of the City for job creation activity and the probable litigation factor because 44 this hasn't been checked within Indiana regarding government issuing a franchise agreement with a private 45 company and then going into competition with them. She said the City is wanting investments into the 46 community and that is exactly what TCI is going to do. 47 48 Here are the figures she shared: 49 50 TCI has gross receipts of $1,020,000 for the first three months of 1993 and projected to a yearly total that 51 would equal$4,080,000.TCI has 12,216 customers and the average monthly subscriber pays$26.85. Using 52 that projected share in price charged by RP&L she gave the following figures: 53 54 The market share in 1993 would be 0, revenues 0 and operating expenses $160,866 with capital 55 expenditures of$3,186,000; in 1994 the subscription would be$16.50 per subscriber which would give RP & 56 L 35 percent of that market for a revenue of $846,450, with operating expenses of $677,743 and capital 57 expenditures of $1,587,000; in 1995 the subscription would be $17.33 for a revenue of $1,016,088, with 58 operating expenses of $1,127,571 and capital expenditures of$298,491; in 1996 the subscription would be 59 $18.20 for a revenue of $1,200,540, with operating expenses of $1,313,254 and capital expenditures of 60 $285,670; and in 1997 the subscription would be $19.11 for a revenue of $1,400,688, with operating 61 expenses of$1,448,843 and capital expenditures of$190,153. She noted that the total cash losses for those 62 five years would be over$6 million and that is not counting any payment on interest or debt.Also,from there, 63 you would have to capture more and more of the market because the operating expenses do go up again. 64 65 744 • ... Common Council Minutes Cont'd •. . . • •May 3, 1993 - . _ . Pale 6 • • • •r. t '! 1 President Lundy asked that:the ordinance be moved to second reading so it could go on-public hearing. Councilmember Elstro èaid.he would stop it from going to second and let it sit on first. Councilmember Brookbank moved to advance the ordinance to second reading.with a second.by Councilmember Dickman . • but Milligan noted that it takes unanimous consent of the Council to move the ordinance to second in this - meeting. However,he advised President Lundy that she could invite public comments on first reading as well • as second. Councilmember Elstro asked for a clarification on the City's bonding capacity and asked what the City might • need money for. Milligan noted that the critical figure for Richmond in any one-year is $10 million.He said 1 I the City receives a significant tax break in selling bonds if it maintains under the IRS ruing a small issue 1 ' designation. Up to $10 million the City retains that designation and obtains about 60 basis points which is 1. six-tenths of one percentage point which is a significant savings. If-the City goes over$10 million it doesn't 1 have the capacity to get preferable rates. Milligan added that it all boils down to whether you want to use this 1- $6.9 million which is almost 70 percent of the preferable rates far this project as opposed to economic 1- development projects. In answer to Councilmember Elstro's questidn, Grimes noted that the only bond out 1: now is the Park Department bond which is about'$600,000 plus the T.I.F. bonds for the Industrial.Parkway 1 which is about $1.7 and $2.2 million. When Councilmember EI§tro asked what was in the future if the City 1 didn't want to mess with the bonds and Mayor Cornett responded that nobody said the City:didn't want to 1 float bonds which brought,the question-from,Councilmember Eltro as to why.does the City want to save its :. 2 bonding capacity. Mayor Cornett pointed.out that the City wants to develop the southeast and.the northwest, 2 it wants to buy buildings downtown and wants 3,000 jobs'and you can't do all that without spending some 2- money. He added that so far it hasn't been determined if there will be enough.money to to all the above 2 because it hasn't been fully researched yet. • . 2. . 2- Councilmember Parker asked Milligan if there is any way Council can find out if the Board of Works will grant 2: the franchise prior to the whole bonding process. Milligan answered that the corporation has to be created 2 first and it would seek to update the franchise during the bonding process. He said that obviously if a 2: franchise couldn't be obtained the corporation could not go ahead with the bonding. He added that the 2• franchise would be a major asset to the holding corporation because without the right to operate the system 3i the whole system would be rather useless. 3 . 3- Councilmember Dickman commented that RP & L had spent in excess of$300,000 to get this this far and 3 asked who takes over the expenses. Milligan noted that the expenses.would be borne by the holding 3• corporation and paid out of the bond proceeds. He added that part of the resolution in this process would be 3• to reimburse RP'& L for all expenditures to date so the bonds would not only pay for expenditures from this 3. time forward but would reimburse RP &'L. He said that would be the first step once ordinance'is in place, 3 adding that if there are no bonds the holding corporation would have no resources.to build the system. He 3: said the holding corporation would be issuing bonds which would pick up all-those expenses which would 3• include funding expense and advance engineering expenses However it would be reasonable to assume 40 that it would not go ahead on thosa initiatives until they were in a position to operate''the system at a 4 franchise and build the system, have the bonds in place.and sell the bonds.He added that you have to have 4 the money in the bank before you start incurring expenses. • Councilmember Allen said in consulting the financing plan received from Ice Miller, one of the first steps is that after the receipt of a petition signed by at least 50 taxpayers the Common Council will adopt the 4: resolution. She asked if there is such a petition. Milligan said once the process is set up that is the first step 4 in creating the bond obligation to the City, noting that the statutory part of the petition is the`first step of 4: bonding and you would create the holding corporation simultaneously. He added that in this financing 4° proposal there is a.provision where that money will.be reimbursed to RP.&L if the bonds are sold. 50 5 President Lundy declared Ordinance No. 35 - 1993 on public hearing and asked those.in.favor to step 5 forward. . • 5 i • • . 5. John.Billheimer of 809 South J Street,',cited TCI's bad record, but said he would like to get off the subject of 5' television for a change:He noted that some dish owners pay $250 a.year to rent satellite space;adding that 5. $16.50 cents seems a lot cheaper than $250. He said he felt somebody isn't listening and citedthe future for 5 this communications system. He said one thing would be helpful and that would be to have a library in your 5: home and equally helpful for thos with computers in their homes. He stated that if.RP & L.starts off with 5 $16.50 permonth the first year and raises:it 25 cents a year,subscribers would only pay$17.50 in four years: 60 - AI 6 President Lundy asked future speakers to limit their comments to three minutes.. . 6 . 6, Michael Leventhal,of1315 Hunters Pointe Drive said he would title his talk. "How Soon We-Forget," 6, reminding those in attendance that six years ago people were'compaining about TCI's service, the 6• disruption,.rate increases after rate increases, the scrambling of channel locations and two years aog TCI 1 r'emoved Channel 6, making oitizens furious, but there'was no'discussion about putting it back on. He mentioned the second descrambiing of channels that happened, noting that.on Labor Day weekend there was a telethon but it was not available to local citizens and there was no way they could make donations to this worthwhile charity. He said it-would be prudent'to'consider the investment. He touched on'the track record of RP &.L, noting that he didn't think-the project will fail. He commended Huffman and his staff for their past actions. • l . • • . Common Council Minutes Cont'd May 3, 1993 Page 7 1 President Lundy asked those against the ordinance to step forward. 2 • 3 Jerry Easley, 601 Chelsea Way, president of the Richmond/Wayne County Chamber of Commerce, read a • 4 letter signed by the Board. (Copy of letter in Council file). 5 6 When Councilmember Donat asked Easley to finish the letter he answered that that was the complete text of 7 letter. She said the letter she received also said it was not from the entire Chamber but only from a few 8 members of the executive committee which were named. Easley showed her the entire letter exactly as it 9 was sent and Councilmember McBride shared his. She said she would check her letter at home. Easley 10 commented further about the newspaper article he attached to the letter to each Councilmember, noting that 11 it reported on one of the systems used as a model system in Arkansas. He noted that that system has now 12 had to enact its tax backing for its property taxes and is averaging every property tax owner an additional 13 $2.75 per month or$33 per year in additional property taxes just to subsidize that system. Councilmember 14 Donat apologized, noting that perhaps she had confused the letter with the article that had appeared earlier 15 in the Palladium-Item. She asked if letter was okayed by the entire leadership of chamber. Easley said it 16 represented the majority. She then asked for him to elaborate and tell how many signed. He said all were in 17 favor but only 20 were asked to sign. Easley pointed out that it was not felt appropriate to ask the Mayor to 18 sign, nor Bill Clarke, the assistant manager of RP & L, the president of the Wayne County Commissioners 19 and the two ex-officio members.. 20 21 Larry Stevens of 2801 Southeast Parkway, noted that his boss, Don Blair, vice president and general 22 manager of Perfect Circle here, recently wrote Mayor Cornett a letter containing his objections. In that letter 23 Blair said Council is expected to approve the ordinance on May 3, and if that occurs,the next step is left to 24 the Mayor's discretion. He added that the Mayor's veto will have the support of Dana Corp. He said his 25 concern regarding RP & L attempting to enter an area outside of its realm of expertise is real and comes 26 from his own Dana experience. He said over the past several years Dana has attempted such moved and 27 learned to its dismay that what appeared to be a smart decision turned out to actually be quite costly. He 28 said it took awhile but it now understand that it should stay with what it knows. He added that he believes RP 29 & L will continue to be a viable supplier of power to the Richmond community and it should plan to serve the 30 community as effectively as possible in that capacity. 31 32 Dave Runyon, 200 Glenwood Drive, vice president of Economic Growth Group Inc., read a letter sent to 33 mayor and councilmembers signed by members of the EGG board. (Letter in file). 34 35 Gail Bunker of 15 South West 9th Street commented that he was the owner of several different properties 36 and was against RP & L going into the cable business, adding that if this fails then everybody's taxes will go 37 up. Giving an example to illustrate his point he said, for example, he is a subscriber but his neighbor is not. 38 That neighbor, he said, is satisfied with the 25 channel selection he has, yet, any failure in this project and 39 his neighbor will incur a higher tax to help pay for his 60-channel TV luxury. In other words, he said, his 40 neighbor doesn't want it but his taxes will be increased. He added that all that should have been ironed out in 41 the beginning in absolute fairness to everybody. He said he would rather see the millions of dollars spent for 42 jobs in Richmond, adding that his children had to leave town and move to Indianapolis to find adequate 43 employment. 44 45 Robert Shafer of 8 South 27th Street noted that one of the biggest issues at hand at present is the change in 46 technology. He said in July 1992 the Federal Communications Commission came out with the decree on 47 video dial tone to encourage the local exchange carriers to participate in the developing of an advanced 48 telecommunications infrastructure. Having some difficulty in delivering his message, Shafer yielded the 49 podium to Stevens who continued to read the prepared text. Shafer stressed that the two major stakeholders 50 most likely to figure in the current needs of the future are the cable companies and the telephone companies 51 and because of the network cable and equipment required to provide this service to the customer only one of 52 these stakeholders will survive. He added that the cost will be prohibitive to have multiple services serving 53 the same areas. He noted that services that the customer wants include interacting TV, multimedia libraries, 54 consumer services such as shopping, video jukeboxes, broadcast video, video music and video telephones 55 but these services will require converging technologies to provide cost effective service opportunities in the 56 residential market. He said cable TV of the future is much more than delivering the network TV programs into 57 our homes. The cost of these expander services, he added, will be far greater than any of the cost of 58 providing basic TV service. 59 60 Paul Lingle of 801 North A Street, president of the Greater Richmond Progress Committee, read a letter 61 signed by him but stating that group's stand against the ordinance. (Letter is in Council file). 62 63 Stan Vigran of 227 South 17th Street said he sympathized with Council members because this is a 64 community problem. He said there is a 5-4 vote on something that if it is going to be done should be a 9-0 65 vote. G.. Common Council Minutes Cont'd • • Mav3,1993 . . . . Rage - • . - • . 1 : : lie said the issue here is whether or not the City is going to risk its tax base to•put this project over. He - - .added that it was his personal opinion that it is a risk that should not be taken, noting that originally when the ,' • subject of RP'& L going into the communications area was first addressed no.mention was made of the , • geheral obligation bonds to the City. He asked Councilmembers to search their consciences and minds • before taking action, adding that if it is going to be done it ought to be a 9-0 vote because it is going to be an • uphill fight. . • Andy Cecere, retired attorney,who noted that he had appeared before Council on three prior occasions,said • he was originally opposed to the issue because he didn't feel the financial integrity of RP.& L should be le jeopardized. Now, he said, he feels that that argument is equally applicable to the City of Richmond:He also 1 pointed out that there is a great problem, perhaps a legal problem, asking how can a franchisor also be a 1- franchisee. He added that even'if it is not a'legal problem, he feels it is an equitable and moral one because 1 you take a fee from someone and then turn around and say you are going to oppose them because you're 1• going to be on the other side. He said he didn't agree with what'had been said earlier,that if Council passed 1- a resolution now you could take care of the fees already incurred. He said he believes there has to be an 1; inducement resolution prior to spending the money anti if'none has ever been passed then RP & L will be 1 responsible for.the $400,000 expense. Cecere concluded by saying that he isn't going to assume that the 1: 5-4 vote is going to change which means that the citizens are•going to have to.lookup the mayor and the 1• Board of Works to stop this action and it can be done very simply-by refusing to give a franchise to the new 21 company: ' , .. : . ' • 2 2 John Valentine identified himself as an employee of Belden but said he was speaking.as a citizen.The last 2 12 years, he said, he has been involved in the technology of the manufacturing of wire and cable for the 2• communications industry-and privey to,be able to develop products and sell to the industry. In this capacity 2' he said, has followed the technology that is known today as wide area'networks and that is what the City is 2: trying to install. He said although he applauded the City to'be.aware of the fact that futuristic people and 2 powers of the market will demand this type of product,when it is time to service this kind of industry it has to 2: be recognized that the technology changes almost by the'houranymore. He cited the ever changing market, 2• noting that the Hughes satellite:is scheduled to launch in'September and franchises have already been 3' issued to several places in the United States but it just hasn't become very visible. He said his problem with 3 this project is that when you invest your today dollars, tomorrow the technology will change. He added that 3 he felt the studies which have been done and presented do not accurately reflect, in his opinion as a citizen, 3 the overall investment that will be required to,maintain what he called the forefront of the technology. 3' 3 Valentine said he sees big dollars and big bond issues in that field'of technology that are basically not 3• so-called city supported and big dollars that are all over the United States and the world. He added that he 3 wants to be a part of the investment in that particular market place-and he will do it through his private 3: investment'opportunities, but as a taxpayer, he said he thinks it is a big risk. He said he thinks it is an 3' opportunity that if he was investing today he.would want to pass on from the performance of what he thinks 40 history has demonstrated. He concluded by saying that technology is moving too fast for him as a taxpayer 4 to support it and he felt that if Councilmembers will look carefully and investigate it as far as their finances or 4 their personal opportunities-will take them they will come 'away drawing the same conclusion. Ending his comments, Valentine said what he was trying to say is that it is bigger than what we can handle here in • Richmond. ' 4. Doug Oler of 2201 Reeveston Road statedthat one of the main reasons he opposed the ordinance was a 4 simple matter of philosophy. He noted that he is a conservative and believes there are only a few things 4: government should be running in competition with private enterprise. He said he thinks government cannot 4• run businesses as well as private enterprise and RP & L may be 'the only exception. He asked 5o Councilmembers if they were making this expenditure would they put$6.9 million or any substantial amount 5 of money into a project when somebody comes to them and says they want them to invest in this company 5 which may get 50 percent of the market in four orfive years and in four or,five years they may be breaking 5 even but in the meantime they are going to lose a few hundred thousand'doallars and they're going to be 5• competing against the largest company in the industry and at the end of those four or five years they may be 5- breaking even but they'll get no return on their investment until that time. He asked if they would put their 5• own money in that type of venture and said, if the answer is no,then why would they vote to put somebody 5 else's money into it, namely the taxpayers, adding that it is easy to spend other people's money but difficult 5: to put in personal funds.Oler said that is where-leadership comes in and that is what leadership is all about. 5' He asked why precious bonding authority should be used for a venture that is risky and added that he felt it 6 a should be saved for job opportunities.Concluding, he said when the City'contracts with a third party and 6 contracts with itself there has to be.a-nioral issue and he had to believe it is a seed from which a lawsuit will 6 surely bloom. ' 6 _ . 6• Mary Kay Tolen of-3419 Glen Hills Drive, speaking in favor of the ordinance, asked the question that if 6- technology has been moving so quickly why has it taken TCI'so long to get on the ball. She said that you only have to look at RP&L and how it runs its business to see that it is one of the up to date'run companies in the United States,adding that someone from Finland helped them put in their new technology. • • - •' 247 Common Council Minutes ont'd a6A k3Yt199' Page 9 1 Ida Isenhart of 212 North 36th Street, identified herself as a retired factory worker, noting that she cannot 2 have her taxes raised. She said she was very surprised that her party Democrats would vote to pass this 3 ordinance so her taxes could possibly be raised. 4 5 Councilmember Donat requested a Committee of the Whole meeting to discuss the ordinance and the issue 6 brought forward from the RP & L meeting. Councilmember Elstro interjected that a whole new ordinance 7 could be written and presented before Council. Milligan reminded Council that its purpose is not to create the 8 holding corporation but to authorize the creation. He added that Council is involved idn policy, not the minute 9 steps and mechanics of an operation. 10 11 Councilmember Donat moved that a Committee of the Whole meeting be held for the creation of a holding 12 corporation,second by Councilmember Elstro and the motion was carried by a 6-3 vote. 13 14 ORDINANCES ON SECOND READING 15 16 None 17 18 ORDINANCES ON THIRD READING 19 20 None 21 22 ADJOURNMENT 23 24 There being no further business,on a motion duly made,seconded and passed,the meeting was adjourned. 25 26 27 28 29 30 31 32 -- ------------------------________-- 33 Etta J. Lundy, President 34 35 36 37 38 39 ATTEST: 40 Norma Carnes,City Clerk 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 • • • • • • • • • • • • � •• • • • • • • • • • • • • • • • • :,. • • • r'• • r. .