Gillespie Lake (Archived photo)

Gillespie city aldermen voted unanimously Monday night to purchase a vacant property at the corner of Montgomery and East Chestnut streets at a cost of $5,000.

The action followed a 30-minute executive session to discuss the acquisition of real estate and other issues. Mayor John Hicks said $5,000 was a “good price” for the parcel, which will be used for city purposes yet to be determined.

One possible use for the property would be as a parking area for the fledgling Illinois Coal Museum and downtown businesses. Gillespie residents may be familiar with the parcel as a parking area for carnival workers during the annual Black Diamond Days street festival.

POSSIBLE SWIMMING BEACH DEVELOPMENT

Polo reported that the city’s insurance carrier had responded to a question regarding the city’s liability if the city opens a beach for swimming at Gillespie Lake.

“He said that as long as you have posted signs that say ‘Swim at Own Risk – No Life Guard,’ we should be okay,” Polo reported.

Lake Committee Chairman Frank Barrett said the necessary signage is in storage at the lake. “We will probably need some sand and we’ll need to buy some floats,” he said.

Barrett also reported that he was recently contacted by Josh Ross about the possibility of establishing a Park District. Establishing such a district would require voter approval. It would be separate from the city council, although it would manage city-owned recreation facilities. It also would be its own taxing body, generating revenue from a property tax levy.

“It could include things like the mining museum,” Polo noted.

“The No. 1 thing young families want in a community is parks and recreation for their children,” Barrett said. “If you want to keep young families in town, we need to provide something for them.”

The council deferred until May a decision on whether or not to stock hybrid striped bass in Gillespie Lake.

WATER PROJECT HEARING

City Treasurer Dan Fisher reported that a public hearing is scheduled at 6 p.m.,  Monday, April 24, to accept public comment on a developing lake and water infrastructure plan, as well as the city’s intention to borrow several million dollars to finance the projects. The tentative plan, still in development, includes repairs to the leaking lake spillway and water line replacement throughout the city.

Fisher told the council in January that Curry and Associates Engineers of Nashville, the city’s engineering firm, was working on preliminary engineering on the projects, which are expected to cost an estimated $10 million. At the time, Fisher said the city could divide the project into two phases of $5 million each without having to raise water rates to service the debt if the city opted to use existing funds to pay off an existing EPA loan of $482,200.

Council members discussed the possibility of paying off the EPA loan early last month but has not yet taken action.

In January, Fisher reported the city probably would be required to raise water rates substantially if the council opts to proceed with the full $10 million project without first paying off the existing loan. The EPA loan, with an interest rate of 2.5 percent, currently costs the city $127,609 annually in debt service. Paying off the loan would free up enough money to allow the city to comfortably make the estimated $205,000 monthly payments to service a loan of $5 million.

According to Fisher, the city has an opportunity to borrow $5 million or $10 million through the USDA’s Rural Development program to finance the water infrastructure project at a current interest rate of two percent. That rate is expected to increase, however, if the city does not commit to the project soon.

“Interest rates are going up fast,” said City Attorney Kevin Polo, noting rates are likely to be increased on June 1 as the start of the second fiscal quarter.

[pullquote]The city still would be unlikely to start construction on the project until at least the spring of 2018.[/pullquote]

“We are going to try to obligate all of the money before June 1,” Fisher said, in order to secure the lower interest rate. With the money obligated, the city still would be unlikely to start construction on the project until at least the spring of 2018. “We won’t be closing on this stuff until late fall, so we probably would be looking at construction a year from now. But we want to get everything finalized now.”

Federal grants are available for such projects, but the city probably would be ineligible to apply because water rates charged to consumers fall below the level required by the grant programs.

“The median rate here should be $51 per month,” Mayor Hicks said. “That’s what we’d have to charge to be grant eligible.”

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“We’d have to raise rates a lot,” Fisher agreed.

Regarding another matter, Fisher told the council the city is on target with keeping expenditures for the fiscal year within the $3.1 million the city budgeted. Based on current activity, Fisher said he expects the city to end the fiscal year with about $3 million in expenditures.

“It looks like we will be about $100,000 under budget,” he said.

The fiscal year ends April 30. Fisher said he and City Clerk’s office are working on an appropriations ordinance to be presented during the council’s May meeting.

EQUIPMENT PURCHASES

On a motion by Alderman Jerry Dolliger, the council approved the purchase of a used snow plow and salt spreader from Adam Meur, Gillespie, at a cost of $2,000.  Dolliger said the equipment, which can be mounted on a city-owned truck, is valued at about $12,000.

“The salt spreader had six bags of salt run through it,” Dolliger said.

The council also approved purchase of a Toro push mower from Neal Equipment, Litchfield, at a cost of $350. Dolliger said the city previously have purchased less expensive mowers, but they generally have lasted only one season.

“This year we want to buy a Toro mower and see if we can get more than just one year out of it,” he said.

On a motion by Ald. Dave Tucker, the council approved a $995 change order to add a second gate to a project to install a six-foot chain link fence around the city lagoon. The change order brings the total cost of the project to $3,975. City worker Dale Demkey said the second gate is needed to allow backhoe access to the site.

RECYCLING CONTRACT

On a motion by Ald. Tucker, the council agreed to renew a contract to lease recycling collection equipment to the Illinois Valley Economic Development Corp. Rehabilitation Center at a token cost of $1. Under terms of the contract, the city retains ownership of the collection equipment and maintains insurance coverage on the equipment. IVEDC clients staff the collection facility and manage the program.

Tucker’s motion also included a provision to give IVEDC $1,000 to help defary the cost of operating the recycling program. The city made a similar donation last year when it entered into the contract.

“They’re doing a real nice job,” Tucker said. “It’s a community service. There are a lot of people who use it.”

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