Seabrook Island Town Council – July 28, 2009
Council opened the public hearing for ordinance 2009-04: the approval of revisions to the Town of Seabrook Island’s Comprehensive Plan, at 2:25pm. As there was no one present to comment on the ordinance, the public hearing was closed.
Sorting out the Utility situation
Joe Hall of the Seabrook Utility Commission asked to speak at the beginning of the meeting as he had a Utility meeting to attend immediately afterward. “I don’t know where to begin,” he said. “This Town and thousands of others across the U.S. have been hit by this financial state.” The problem, Hall said, is that the Utility’s bond, which is owned by bond holders, was covered by insurance until the insurance company itself went broke and essentially became insolvent due to their insurance of toxic asset mortgage bonds. “Our bank has to have one year coverage for our bondholders,” said Hall. “So we went to several banks for a letter of credit, but because of the current financial situation, they won’t give it to us.” Basically, he said, the Utility needs $438,000 to cover the bonds until the Utility can once again find insurance coverage.
In the best interest of the Town, Joe Hall looked into the interest the Town would accrue if it simply put up the cash for the Utility Commission and found that they would only receive 0.5% interest on a cash deposit. However, if the Town put the funds into CDs or government bonds, then they could receive 3.5% – 4% (with five year CDs). The Utility’s bank, said Hall, has already agreed to accept the funds as either CDs or government bonds.
Councilman Holtz stated that he was all for transferring the $438,000, “but I hate to lock it in for five years. What about if, in two years, the companies recover and you [the Utility Commission] can buy insurance? Is our money gone for five years?” He pointed out that he was happy to help, but he wanted the option of being able to get the funds back as soon as it was possible. “I hope the current financial situation won’t continue for the next five years,” he said.
Hall agreed, saying that the only reason he looked into the five year CDs was because of the higher interest rate.
Mayor McNulty said that he hated to ask, but did Hall know if there were any “bailout” funds proposed for the Commissions situation. Hall replied that none of the TARP funds covered this aspect for municipalities. McNulty then asked how long it would take for the Utility Commission to take over the bond coverage, to which Hall replied that they should be able to take care of it in about three years. “Our cash flow is regular,” he noted. “Our cash flow today just isn’t good because we’re writing checks for capital goods,” Hall said in reference to their payments to the contractor for the recent pump repair and replacement project on the island; a project which FEMA agreed to partially fund, though the Commission is still waiting on the check.
In the end, Council agreed to transfer $438,000 to fulfill the covenant of the Utility Commission bonds for a three year period, with the details of the transfer to be worked out in the next month or so. The motion was passed unanimously.
Mayor McNulty reported that, on the positive side, throughout the first six months of the fiscal year, revenues exceeded expenditures, though revenues are $82,101.99 behind last year-to-date. “It’s all on the revenue side,” said the Mayor. “Our expenditures are actually a little less than last year. In a nutshell, it’s all due to business licenses.” Compared to this year’s budget, however, the Town has brought in $62,999.52 more than anticipated. “At the end of the first six months, we’re about where we thought we’d be,” said McNulty. “Unless things fall apart, this year won’t be great, but it won’t be a disaster.”
Councilman Holtz agreed and expressed his concern about the State taking over the collection of Comcast/cable fees for municipalities, pointing out that the State was using this as an opportunity to “balance their budget on the backs of the municipalities.”
Mayor McNulty motioned to have the funding for the Fourth of July fireworks moved from their classification as “other” to “accommodations tax”, as they would be paid for from that section of this year’s budget. He also noted that the cost of the fireworks had been $10,000, but with the additional costs of hiring firemen, a backhoe and a sheriff and deputy, the total cost ended up being $11,350. The motion to move the “fireworks” line item into ATAX and to make the total $11,350 was approved unanimously.
What’s the code?
Town Administrator Randy Pierce stated that he was speaking with the Municipal Code Corporation (MCC) about codifying the Town ordinances. “They would take all of the Town’s ordinances and compare them with State ordinances to make sure there was no conflict,” Pierce explained. “Then they would organize them and put them in binders, similar to what they did five years ago in 2004.” Pierce noted that he attempted to get in touch with the same company who handled the Town’s recodification the last time and found that they had merged with MCC. The total for all materials and service, he said, would come to $8,250. However, Pierce asked that the Town allow a representative of the company to come to the next Council meeting and explain the process before the Council made a decision.
Councilman Holtz asked if the updated Town Code would also be available online and Pierce said that yes, it was included in the cost. The Council agreed to meet with the MCC representative before approving the expenditure.
Second reading of ordinance 2009-04: approval of revisions to the Town of Seabrook Island’s Comprehensive Plan
As there were no public comments on ordinance 2009-04 before the Council meeting, Council approved the revisions to the Town’s Comprehensive Plan unanimously. Councilman Savin asked that if, since the data used in the update were from the 2000 census, would the Plan be updated once the 2010 data were available? Administrator Pierce said that the data would be updated when the numbers were available, though it might not be ready until 2011. At that time, the Comprehensive Plan update would have to be reapproved by the Council.
Seabrook resident Sam Reed stated that he was working with Dr. Paul Roberts of the Kiawah Island Community Association and Jim Bannwort from the Seabrook Property Owners Association board & vice chair of the Roads Committee on a letter which would be sent to all of Charleston County Council concerning a new road between River Road and Bohicket Road. “I will get it into your hands and if it’s worthy of your signature, sign it,” said Reed to the Mayor and Council. Reed felt that this was an important step as he feels that the County Council is “finally beginning to nod a little at this [the proposed road].”
Aug 07 2009
Seabrook Town Council
Seabrook Island Town Council – July 28, 2009