Small Town News

Manchester Creates Public Utility Authority

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The Manchester City Council officially created a Public Utilities Authority at special called meeting last Thursday.

The members of the Council will comprise the membership of the authority. Bruce Burt and Solomon Ferguson were elected to three-year terms.

Mayor Anthony Clifton and Mayor Pro-Tem Travis Ferguson were elected to two-year terms. Patisue Elliott was elected to a one-year term.

Officers of the authority were to be voted on at a special called meeting scheduled before the October Regular Meeting this morning.

Bill Camp of the Morgan Keegan Company presented Council members with copies of the city's debt profile.

Camp proposed a plan whereby the city would sell its revenue-producing water and sewer systems to the Public Utilities Authority at lower than their actual value.

"Just because you sell these systems, it will not change the business models for the revenues," Camp said. "The revenues for those systems pay for your principal and interest payments."

Camp presented a plan in which by selling the systems to an authority, the city could solve its pressing financial problems.

He outlined a plan that would pay off the city's $1 million TAN (which is due December 31), an MDA note of $400,000 (used to refurbish the Goody building), and put $1.2 million working capital in the city's General Fund - all taxable items.

THE PLAN would also pay off the $3.8 million tax-free Series 2008 CPU (Combined Public Utilities) bonds. The remainder of the $6,655,000 total would go to taxable bond issuance cost and gross bond insurance premium.

Camp said the plan would also lower slightly the monthly debt service payments the city makes.

The down side would be that the city will extend its current debt service from eight years to 21 years.

The arrival of landfill revenues, hopefully by next spring, and the sale of the Goody building could also be used to more quickly reduce the debt service.

"My advice is that you do not borrow any money that the water and sewer systems cannot pay for themselves," Camp told the Council. "There is plenty of value in the systems to allow for this and give you some money for the General Fund."

The fact that tax notices will likely be coming out late and that no one is sure when tax revenues will be coming in makes the current financial situation more of a pressure pot.

"This will raise money now and get youthroughoperations,"Camp said. "We structure a transaction that will not increase your debt service over what you are paying now."

City Attorney Jerry Ann Conner was to bring a resolution Monday so that the Council could move forward with the process.

In other business:

The Council voted to replace the 40 windows in the Community Building at the cost of $12,000. City Manager Danny Walton said there is money in the building's account to cover the cost.

The Council voted to approve the intergovernmental agreement with the Meriwether County Board of Commissioners on fuel purchase.

The Council discussed upgrading its cable system.



Copyright 2009 The Manchester Star-Mercury, Manchester, Georgia. All Rights Reserved. This content, including derivations, may not be stored or distributed in any manner, disseminated, published, broadcast, rewritten or reproduced without express, written consent from SmallTownPapers, Inc.

© 2010 The Manchester Star-Mercury Manchester, Georgia. All Rights Reserved. This content, including derivations, may not be stored or distributed in any manner, disseminated, published, broadcast, rewritten or reproduced without express, written consent from DAS.

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