'Christmas in July' as Gilmer bond rating improves two notches
Jul 27, 2014 | 1906 views | 0 0 comments | 25 25 recommendations | email to a friend | print
The city of Gilmer has received an unexpected two-step improvement in its bond rating for general obligation debt, a move which could save the city interest when it borrows, City Manager Jeff Ellington told the city council Tuesday.

The credit rating firm Standard and Poor’s raised the city’s rating from A to AA minus, said Ellington, an act which Mayor R.D. (Buck) Cross said gives the city a “lot lower” interest rate on loans.

The action is important because the city should save thousands of dollars in interest if it borrows for street paving, Ellington said.

Commending city Business Manager Gary Smith for his role in obtaining the higher rating, Ellington termed the improvement “a complete and total surprise, like an unexpected dessert.”

When he became city manager 9 1/2 years ago, Ellington recalled, the city’s bond rating was “pitiful. . .junk bond status,” so “I’m quite proud of” the upgrade.

The council voted to acknowledge the higher rating in the record.

At the conclusion of its usual monthly meeting, the council held a budget workshop which Ellington said lasted less than an hour, and which resulted in his saying Thursday he expects to recommend a slight reduction in the city’s current ad valorem tax rate.

He said it appears he will suggest cutting the current rate of .6354 cents per $100 valuation to the “effective tax rate” of .625178 cents - the theoretical amount needed to generate the same revenue as last year.

In other business Tuesday, the council approved Ellington’s request to procure an easement on property owned by Sammy Overstreet near Scott St. so the city can legally do a drainage project there.

Ellington said a house in the area sits in a “pond” whenever rain occurs, and that he thought “the problem will worsen” unless the city becomes involved. While cities are responsible for drainage, he said, the city can’t legally work on the property unless it has an interest, such as an easement.

“One day, we may need an easement,” Councilman William Hornsby added. Meantime, Ellington proposed he himself bring cost estimates for the proposed project to the council later, and said he thought Overstreet would pay for part of the work.

Ellington said the drainage problem existed before he came to Gilmer in 2004. He quoted Overstreet as saying he had a plan for resolving it, and as requesting the city use its equipment or hire someone.

City Attorney Mike Martin looked at the situation, and “it needs something done,” so Martin drew up an easement, Ellington said.

In other business Tuesday, the council:

• Approved the nearly $395,000 budget for the Gilmer Economic Development Corporation, which the corporation’s board of directors had approved at its annual meeting the prior evening. Most of the funding will go for Lake Gilmer.

• Rejected an offer to purchase city-owned mineral and royalty interests after Ellington said he recommended never selling the city’s mineral rights.

• Authorized new Police Chief Mark Case to execute an agreement between the police department and certain state officials in order to use the Texas Law Enforcement Telecommunications System. Ellington said state law required the TLETS Agency/Equipment Agreement with the Texas Department of Public Safety and the system’s state administrator.

• Authorized Case to execute an interlocal cooperation contract with the Department of Public Safety for DPS, reprographics and distribution services. (Case’s predecessor as chief, James Grunden, had that authority, but retired June 30, and the council’s action was necessary so Case could be a signatory, Ellington said.)

• Approved the Gilmer Area Chamber of Commerce’s request for $1,650 for tourism advertising in the 2015 North East Texas Visitor and Events Guide. The funding will come from the hotel/motel tax fund, and chamber Executive Director Joan Small told the council that purchasing an advertisement would entitle the chamber to six listings of its events, and an article in the publication.

• Approved Johnny Maurice Johnson’s request for city water service at 1668 Cherokee Trace outside city limits. The customer will be charged a higher rate than in-city users.

• Accepted, in separate votes, the city’s investment report for the period ending June 30, the city sales tax monthly report, the police department’s monthly report for June, the fire department’s monthly report for June, the food establishment inspection report for May/June and the code enforcement report for June.

• Approved letting Made-Rite Company of Longview place soft drink machines at the Gilmer Civic Center and police station for city employees’ convenience. Ellington said the firm would retain all revenues from selling the 65-cent beverages.

• Took no action on a proposed ordinance establishing guidelines to govern city council meetings. The council decided to let Martin review it.

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