Milford Works To Finance Sewage Improvements
July 28, 2016 at 4:25 p.m.
MILFORD - H.J. Umbaugh & Associates, Plymouth, and the Milford Town Council will work together to finance Milford's sewage works improvement project.
The town council approved the contract with Umbaugh & Associates Monday pending town attorney Jay Rigdon's approval.
John D. Julien, certified public accountant with the company, presented the council with unaudited and limited financial information for discussion on financing the project.
In the report, for the 12-month period ending Dec. 31, the town's municipal sewage works' total operating receipts were $189,205. Total operating disbursement is $102,777, leaving $86,428 for net operating receipts. Total non-operating receipts are $25,649 and non-operating disbursements are $106,919. With the net increase in cash of $5,158 and beginning cash of $500,111, the town sewage works' ending cash is $505,269.
Julien said the town has no outstanding debt. The minimum threshold the town needs to keep is $37,129 but Milford has $468,140 above and beyond its minimum threshold.
Two options were presented by Julien for consideration on how much the town could borrow.
Under the first option, the town would pay for the project with a $1 million bond issue funded over 20 years at an interest rate of 5.5 percent. The estimated annual debt service for this option is $83,679, making the estimated annual revenue requirements $229,456.
In the second option, the town would pay for the project with a $660,000 bond issue funded over 20 years at an interest rate of 5.5 percent. The estimated annual debt service under this option is $55,631, making the estimated annual revenue requirements $201,408.
Charlotte Siegfried, Milford clerk-treasurer, told Julien the figures don't include the $80,000 the town will receive annually from the Economic Development Income Tax. Julien said that money will help prevent an increase in the town's sewer rates.
He then presented a table comparing Milford's sewage billings to other Indiana municipalities of the same size and said Milford's rates are significantly below average for its size.
"I think you are in good shape to take on this project," Julien said.
When asked by councilman Douglas Ruch how much Umbaugh & Associates were going to charge for their services, Julien said the total cost is an estimated $15,000.
Ruch asked if there was any benefit to borrowing the money early for the project to lock in a low interest rate. Julien replied there were pros and cons to doing that. Interest rates are low now but if they borrow the money now, they may end up borrowing more than they need.
Dallas Winchester, utilities superintendent, said 20 years to pay off the bonds is too long. "I'd say look at 12 and 15 (years) if that's possible." Councilman Bob Phillips also questioned the need of borrowing more than $900,000 for the project.
Whether the town borrows $600,000 or $1 million, Julien said, the town does want to include a cushion for fees and unforeseen expenses. But, basically, Julien said, the town wants to not raise sewer rates, pay off the bond issue as soon as possible, borrow as little as they can for the project and get the lowest interest rate possible. He said Umbaugh & Associates will revisit the financial information and the issues the council brought up and make a new report for the council to review.
In other business, the town council:
• Heard from Rigdon the landowners affected by the annexation were sent notices. Rigdon received no serious inquiries for or against the annexation. A public hearing and discussion on the annexation will be June 17 at 7 p.m. The areas the council is looking to annex include North Park subdivision sections one and two, Phend & Brown's property and Darrell Krugman's property.
• Reported it received a letter from Janet Ritenour regarding a traffic problem at the intersection of Catherine and Main streets.
• Was told by Town Marshal Dave Hobbs the police department is still accepting applications for reserve officers.
• Approved for Hobbs to spend an amount not to exceed $350 for a new printer.
• Accepted the resignation of reserve officer Shane Blackburn.
• Approved a quote from Airmarking Co. Inc. for $2,000 for road markings.
• Approved a quote from R&R Visual for $850 for sewer line inspection using camera equipment.
• Was told by Winchester that mosquito fogging will begin as needed on Thursdays soon after dark. The direction of travel will depend on the wind.
• Heard the Memorial Day parade is May 27. Line up is at 9 a.m. with the parade beginning at 10 a.m. Following the parade, the Milford Area Development chicken barbecue will be held.
• Approved the purchase of a resting bench for the front of the town hall at a cost not to exceed $700.
• Approved an ordinance suspending garage sale fees for Memorial Day weekend and MilfordFest.
• Approved budget workshop dates for June 3 at 6 p.m. and June 10 at 6 p.m. followed by the regular meeting and June 24 at 6 p.m.
Members of the Milford Town Council present Monday were Douglas Ruch and Bob Phillips. Not present was council president John Lehman. The council meets at 7 p.m. on the second Monday of every month in the town hall. [[In-content Ad]]
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MILFORD - H.J. Umbaugh & Associates, Plymouth, and the Milford Town Council will work together to finance Milford's sewage works improvement project.
The town council approved the contract with Umbaugh & Associates Monday pending town attorney Jay Rigdon's approval.
John D. Julien, certified public accountant with the company, presented the council with unaudited and limited financial information for discussion on financing the project.
In the report, for the 12-month period ending Dec. 31, the town's municipal sewage works' total operating receipts were $189,205. Total operating disbursement is $102,777, leaving $86,428 for net operating receipts. Total non-operating receipts are $25,649 and non-operating disbursements are $106,919. With the net increase in cash of $5,158 and beginning cash of $500,111, the town sewage works' ending cash is $505,269.
Julien said the town has no outstanding debt. The minimum threshold the town needs to keep is $37,129 but Milford has $468,140 above and beyond its minimum threshold.
Two options were presented by Julien for consideration on how much the town could borrow.
Under the first option, the town would pay for the project with a $1 million bond issue funded over 20 years at an interest rate of 5.5 percent. The estimated annual debt service for this option is $83,679, making the estimated annual revenue requirements $229,456.
In the second option, the town would pay for the project with a $660,000 bond issue funded over 20 years at an interest rate of 5.5 percent. The estimated annual debt service under this option is $55,631, making the estimated annual revenue requirements $201,408.
Charlotte Siegfried, Milford clerk-treasurer, told Julien the figures don't include the $80,000 the town will receive annually from the Economic Development Income Tax. Julien said that money will help prevent an increase in the town's sewer rates.
He then presented a table comparing Milford's sewage billings to other Indiana municipalities of the same size and said Milford's rates are significantly below average for its size.
"I think you are in good shape to take on this project," Julien said.
When asked by councilman Douglas Ruch how much Umbaugh & Associates were going to charge for their services, Julien said the total cost is an estimated $15,000.
Ruch asked if there was any benefit to borrowing the money early for the project to lock in a low interest rate. Julien replied there were pros and cons to doing that. Interest rates are low now but if they borrow the money now, they may end up borrowing more than they need.
Dallas Winchester, utilities superintendent, said 20 years to pay off the bonds is too long. "I'd say look at 12 and 15 (years) if that's possible." Councilman Bob Phillips also questioned the need of borrowing more than $900,000 for the project.
Whether the town borrows $600,000 or $1 million, Julien said, the town does want to include a cushion for fees and unforeseen expenses. But, basically, Julien said, the town wants to not raise sewer rates, pay off the bond issue as soon as possible, borrow as little as they can for the project and get the lowest interest rate possible. He said Umbaugh & Associates will revisit the financial information and the issues the council brought up and make a new report for the council to review.
In other business, the town council:
• Heard from Rigdon the landowners affected by the annexation were sent notices. Rigdon received no serious inquiries for or against the annexation. A public hearing and discussion on the annexation will be June 17 at 7 p.m. The areas the council is looking to annex include North Park subdivision sections one and two, Phend & Brown's property and Darrell Krugman's property.
• Reported it received a letter from Janet Ritenour regarding a traffic problem at the intersection of Catherine and Main streets.
• Was told by Town Marshal Dave Hobbs the police department is still accepting applications for reserve officers.
• Approved for Hobbs to spend an amount not to exceed $350 for a new printer.
• Accepted the resignation of reserve officer Shane Blackburn.
• Approved a quote from Airmarking Co. Inc. for $2,000 for road markings.
• Approved a quote from R&R Visual for $850 for sewer line inspection using camera equipment.
• Was told by Winchester that mosquito fogging will begin as needed on Thursdays soon after dark. The direction of travel will depend on the wind.
• Heard the Memorial Day parade is May 27. Line up is at 9 a.m. with the parade beginning at 10 a.m. Following the parade, the Milford Area Development chicken barbecue will be held.
• Approved the purchase of a resting bench for the front of the town hall at a cost not to exceed $700.
• Approved an ordinance suspending garage sale fees for Memorial Day weekend and MilfordFest.
• Approved budget workshop dates for June 3 at 6 p.m. and June 10 at 6 p.m. followed by the regular meeting and June 24 at 6 p.m.
Members of the Milford Town Council present Monday were Douglas Ruch and Bob Phillips. Not present was council president John Lehman. The council meets at 7 p.m. on the second Monday of every month in the town hall. [[In-content Ad]]