Home News Local News Elkhart Moves Forward on Certificates of Obligation

Elkhart Moves Forward on Certificates of Obligation

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Criminal Charges Possible for Ex-Bookkeeper

By Will Johnson
Messenger Reporter

ELKHART – The city of Elkhart is moving forward with its intent to issue combination tax and revenue certificates of obligation after a resolution was approved by the Elkhart City Council during its regularly scheduled meeting held on Monday, July 15.

Joey Dierker, Vice President of Hilltop Securities, Inc., was on hand for the council session to answer any questions and provide a recap for what had already transpired.

“We can talk about the next step and kind of go over this again,” Dierker said. “We will look at doing a 15-year certificate of obligation for just over $2 million. These numbers are the same as the ones we looked at last time. The only difference is we now have your 2018 audit, which looks a little better than the 2017 audit.”

The VP explained the 2017 audit showed net revenue in the neighborhood of $130,000 while the 2018 numbers showed a net revenue of roughly $150,000.

“Assuming that keeps going forward, we are looking at a lower rate increase. We estimated $4.25 average monthly increase but with these numbers we are looking at a $2.75 monthly average increase. That will generate enough to pay the average annual payment of $177,000,” Dierker said.

He said next step would be to send out bid specifications to banks and added he expected to have those back in a week or so. After that, negotiations for the lowest rate would begin.

“Tonight,” he continued, “you are not actually issuing debt. You are just approving the notice that will run in the paper this week and next week. Thirty-one days must elapse between the first publication and the sale meeting. I’ll be back on Aug. 26 and we’ll have the official bid.”

According to the Texas Public Policy Foundation, certificate of obligation (COs) allow “… governmental entities—like cities, counties, and certain special districts—to issue debt without voter approval to fund any public project. More specifically, COs can be used ‘… to fund the construction, demolition, or restoration of structures; purchase materials, supplies, equipment, machinery, buildings, land and rights of way; and pay for related professional services.’ As provided for in Local Government Code 271, Subchapter C, COs are usually payable from property tax revenues or other taxable sources.”

A motion was made, seconded and unanimously approved to move forward with the publication of the city’s intent to issue the certificates of obligation.

The next item on the agenda focused on contracts for waste collection and disposal services. Matt Lowe, a site manager for Waste Connections was on hand to give the council a presentation about what the company is doing as the city’s current waste collection service.

Lowe was followed by Clayton Vickers, the president of Ameri-Tex Services ho gave a presentation about what his company had to offer. No action was taken on the agenda item.

As the meeting continued, an agenda item to offer interim City Secretary Ami Ashworth the permanent position was addressed.

“I put this on the agenda,” Mayor Jennifer McCoy said. “Ami has only been with us a short period of time but she is excellent. I do not have the words to describe how wonderful she is. I was hoping we could possibly extend this into a permanent position, if that’s the desire of the council and maybe she would accept our offer.”

The motion was approved unanimously and Ashworth accepted the offer.

Following the actionable agenda items, City Administrator Judith Cantrell provided her report to the council.

“The biggest issue we have with our finances revolves around our past bookkeeper (Tina Harper). She was using QuickBooks, which we were pretty much locked out of. We are not allowed to get into that QuickBook. She has since cancelled her subscription so we do not have the ability to carry over any of our information to do our banking, checks, ledgers or anything. We have had to start completely from scratch,” Cantrell said.

The city administrator said she was able to download a back-up on Excel, but it didn’t have all the information she needed.

“I spent pretty much the entire day on Friday (July 12) with QuickBooks representatives. They advised me the only way to get access to the true data was to download it and then re-upload it to a new account. We would need to re-subscribe to that first subscription but that is technically not the property of the city. It is hers (Harper’s). If I was to pay the $70 to re-subscribe it would re-up her subscription not ours,” Cantrell explained.

Asked a question about who the data belonged to, Cantrell asserted, “It is our data. I did seek counsel on that and it was recommended to me that I pursue criminal charges with the district attorney’s office because it is the property of the city. That is something I am still gathering information to pursue.”

She added Harper could also go into the account and delete all the information but even if no action was taken, the data would eventually disappear.

In other matters brought before the council:

  • Minutes from the June 17, June 22 and July 2 meetings were approved.
  • No action was taken on a request for placement of a fire hydrant at the new fire department building.
  • It was approved to allow the city council and/or staff to attend the Texas Municipal League meeting on Aug. 1 in Nacogdoches.
  • The city’s vehicle policy was discussed, however, no action was taken on the matter.

Will Johnson may be contacted via e-mail at wjohnson@messenger-news.com.