The work session was a town meeting regarding the possible refinancing of two bonds - the golf course bond and one of the pressurized irrigation bonds (PI2). This possible refinance would be to lower our interest rates, which is available to us due to our recent increase in bond rating. Our financial advisor, Marc Edminster, came to present options.
The current PI2 bond has an approximate balance of $900,000. The current interest rate is 5.99% and cannot be called without a penalty. Wells Fargo is offering to refinance that bond and is giving two options:
- Fixed rate of 3.08% for the first seven years, variable rate after that,
- Fixed rate of 2.92% for the first five years, variable rate after that
The GO bond for the golf course was issued and sold in the public markets with no ability to prepay for ten years, which means prepayment cannot occur before 2016. Mr. Edminster was concerned about the negative arbitrage opportunity so recommended waiting at least five months before doing a refi on this bond. The savings realized can either be taken upfront for one year or in small amounts yearly over the life of the loan. This savings would be on property taxes.
Council Meeting
Public Comment
Ken Cromar - Mr. Cromar again discussed the November 6, 2011 Daily Herald article written by Caleb Warnock regarding the golf course. Mr. Cromar would like a newsletter correction regarding the golf course financials. He also expressed concern that his letter read at a recent Council meeting was not included in the official minutes. He has contacted the state records ombudsman regarding GRAMA requests he has made.
**The Golf Course Finance Advisory Committee has met once already and is continuing to meet to review the golf course financials and to present a comprehensive overview of where things stand. This information will be provided to residents once it is complete.
Jan Streeter - Ms. Streeter read an open letter to Mr. Cromar and his supporters. She reminded him that he did not get enough votes to be on the Council. She believes the golf course is an asset to the city even though she is not a golfer. She voted for Councilmembers Gygi, Augustus, and Rees because she felt they had the best ideas for the long term. She feels Mr. Cromar's views discourage business and that his approach shows lack of respect for others.
Robert Wetzel - Mr. Wetzel wanted to express his support for the Council and Mayor. Cedar Hills is a beautiful community. He appreciates the work of the Council, he loves WalMart, and the loves the city. Said Mr. Cromar does not represent him.
Ken Kirk - Mr. Kirk expressed appreciation for the Mayor and Council. He is appalled by those who do not want the Mayor to have an opportunity for justice through the legal system. He condemns the attempts to ruin the Mayor and our city through the media. He asked Mr. Cromar to stop the attacks.
Kim Groneman - Mr. Kirk read a letter from Mr. Groneman. He is upset over the money and staff hours being spent because of attacks made by Mr. Cromar. City does yearly audits and these are sufficient, there is no need for an additional audit. Without these attacks the city staff could focus on more important things. Residents voted for the City Council to make important decisions. Ken Cromar doesn't represent the majority of residents.
Charelle Hagan - Ms. Hagan wanted to recognize the hard work of the Mayor and Council. She previously served on the Council and knows the golf course has always been an issue. It is OK to not agree, but it is upsetting to see the personal attacks that are happening. It is hurting the city and families. She is opposed to any petition asking for the Mayor to resign.
Cameron Tovey - Mr. Tovey is tired of seeing the city in the news. He voted for not defaulting on the golf course bond as he believes in paying your debt and honoring commitments. He is disgusted by the attempts to ruin the lives of elected officials. He is against the petition asking the Mayor to resign. GRAMA requests are costing too much time and money. Feels men who have been arrested and charged with tax evasion are not qualified to serve on the Council.
Wanda Badger - She appreciates the Council, loves the new Community Recreation Center, and appreciates all the work being done.
Jim Perry - Mr. Perry served on the Council for eight years. While on the Council an investigation was launched on a former mayor due to allegations from this same small group but nothing was ever found. This small but vocal group does not represent the silent majority.
Tonya Edvalson - Ms. Edvalson appreciates the work of the current and past Councils. She is proud of Cedar Hills and feels safe and accepted here. Loves the sense of community. Says the city already does audits and nothing of concern has been found. She would like Mr. Cromar to stop the attacks, they are unwanted. She feels it is unfortunate the media doesn't want to tell her story.
Zonda Perry - Mrs. Perry lived in Cedar Hills for 11 years. Councilmembers and Mayor sacrifice a lot to serve. The minority hurts others by the way they go about things. Citizens vote every two years and have made their voices heard. It is unfortunate how much money is being spent to defend against lawsuits.
David Jackman - Doesn't want Council to spend a lot of money on a forensic audit and wants to sign a petition in support of the Mayor.
Darryl Acumen - Loves Cedar Hills and WalMart. He is the state chair for the Republican Party for one area of Cedar Hills and wanted to get a waiver on the fee in order to go door-to-door for voting purposes. Gretchen will work with Mr. Acumen on this.
Nate Cramer - Supports the Mayor and Council and their efforts. Feels the Mayor has always been transparent in discussions. He sees the Mayor wants real world solutions to our issues.
Angela Johnson - Hoped Mayor would step down after federal charges were filed, she feels that would be easier for the City. She supports a forensic audit. She was concerned over an event in 2011 where Kim Holindrake told the Mayor that there was not a current contract on file for Konrad Hildebrandt and was later reprimanded.
Consent Agenda
The minutes from the April 3, 2012 were already approved at a prior meeting and there were no new minutes to approve.
City Reports
David Bunker - In the process of approving the 2013 budget. A public hearing for the budget will be scheduled. Family Festival is next month.
CM Gygi - Attended a meeting for North Point Solid Waste and contract with Allied is coming up. Utah Valley Dispatch is encouraging other cities to join. Working with the Finance Committee on changes to the budget.
CM Jackman - Finance Committee is also discussing refi of bonds. He is attending an LPPSD meeting this week.
CM Rees - Three residents have joined the Beautification Committee and the committee met to discuss a variety of new plans.
CM Augustus - Has a Planning Commission meeting this month.
Mayor Richardson - On behalf of CM Martinez reported that rec classes start on May 22nd.
Discussion on Fiscal Year 2013 Budget
The Council has been reviewing portions of the budget for the past several meetings and the overall budget was presented by Rebecca Tehero. She is still working with Jim Madsen on getting some better and more accurate figures for the golf course. One thing that is changing on the golf course financials is a new line item which will show a dollar amount transferred to the golf course from other funds to subsidize any losses. In the past the golf course considered any losses a loan from the City but this seems to have caused confusion and concern. Moving forward the financials will show any loss as a subsidy from another fund so residents can easily see this information.
Review/Action on Boundary Adjustment on Earl Property
A resident of Pleasant Grove with property located on 9540 N Canyon Road has requested a boundary adjustment to move their property into Cedar Hills. They have already submitted the required paperwork to PG to authorize a public hearing. The Council voted to approve this resolution indicating the intent to adjust the boundary accordingly and authorizes a public hearing to take place.
Review/Action on Parameters Resolution for Refinance of PI2 Bond
As mentioned above, the town meeting held earlier discussed the possible options for a refinance of this bond. A parameters resolution does not approve the refi or obligate us to move forward, but it starts the process so a public hearing can be held. The parameters resolution was approved.
Review/Action on Parameters Resolution for Refinance of GO Bond
Same as above.
Review/Action on Forensic Audit
The Council had requested that Ms. Tehero request bids on a forensic audit after charges were filed against Mayor Richardson. The charges filed have nothing to do with city finances or any of his work as Mayor; however, we understand it has caused many questions. Ms. Tehero reviewed the bids and felt the bid received from Squire & Co. most closely aligned with what the Council wanted to review. The proposal is for $7,600 and would audit the following from the past three years:
- Allegations made against the Mayor by Mr. Severn and Mr. Sorensen regarding use of impact fee money,
- Review the policy on disbursement of funds,
- Verify that controls are working,
- Review the accounting for the golf course
- Review the three transactions Mayor Richardson made on his city credit card
Ken Cromar - Wants the audit done. Says insiders are feeding him information and that is how he found out about Konrad hiring his son-in-law.
Jerry Dearinger - Wants to make it clear the audit was not suggested by his group, he was asked for his opinion by CM Gygi. He wants the audit to go back farther than three years.
Ken Kirk - Outside audits are done each year and nothing illegal has been found. Doesn't want audit. Doesn't want Council to try to appease Ken Cromar or his group as they won't believe the results any way.
Angela Johnson - It wasn't Mr. Cromar's idea to do an audit. Feels the $7,600 audit is not enough. The research she's done for the type of audit she feels we need would cost $100,000 per year audited.
Charelle Hagan - OK with audit, but don't spend $100,000. Asked Council to please use taxpayer money wisely.
Debbie Severn - She believes many of the allegations are factual and wants the Council to answer them. Mayor Richardson stated that Mr. Severn never came to talk with him prior to filing the allegations and he would've met with him any time. Will still meet with Mr. and/or Mrs. Severn any time they want.
Marisa Wright - Doesn't want audit. Says Mr. Cromar misleads residents and won't trust audit results anyway.
The Council approved the audit 3 to 1. CM Gygi voted against. it.
My thoughts - I am not worried about trying to appease a small group of residents. I fully understand that anything we do will never be considered good enough for some. My vote had nothing to do with appeasing a few. Instead, I was thinking of the many residents in Cedar Hills who aren't as politically involved but have read some very disturbing articles in the media recently and are wondering what is going on in our city. I've had several residents approach me with concerns over flyers they've received and news articles they've read. I also thought it was very important to follow the advice of our City Attorney who strongly recommended the forensic audit. It was these two considerations that had the greatest impact on my vote.
Discussion on Civic Center
There is no new information on this so the discussion will be continued at another time.
Appointment to North Utah Valley Animal Shelter
Brad Kearl was the CH representative on this Board. CM Gygi was appointed by the Mayor to now serve as the representative.
Adjourn
The Council did go into Executive Session.
