City plans to put spending question on November ballot

City Council members voted unanimously Tuesday night to put a spending initiative on the ballot for the 2016 general election in November.

The question would ask voters for permission to use money from the capital improvement fund to pay off the debt service on the raw water line.

The water line was created in 2001 when the city signed an agreement with the Southern Nevada Water Authority to construct a water delivery system. The extra pipeline was needed because of an increase in city water usage.

The $27 million water line debt (principal only) is one of two debts remaining on the city books. City Clerk Lorene Krumm said that at the current debt rate the city would be paying $10 million in interest, but at an accelerated debt rate the city could cut that in half.

Councilman Cam Walker said he is not married to the idea of using money from the capital improvement fund, but the money could halt a significant increase in utility rates.

“This is an alternative to consider instead of just looking at rate increases to pay for utilities,” Walker said. “This will free up a couple million in our utility fund and we need everything at our disposal.”

The City Council must ask permission from the voters to use money in the capital improvement fund because section 143 of the city charter states that all expenditures from the fund must be approved by a simple majority of registered voters.

Before going to voters the question must go through a council-appointed ballot committee that will make arguments for and against the question as well as craft the final wording. The ballot question must be presented to the Clark County Election Department by July 21 for it to a part of the November election.

The ballot question is currently worded as follows: “Shall the City of Boulder City expend funds from the Capital Improvement Fund, as they become available, to pay the debt service on the raw water line.”

Mayor Rod Woodbury said that the question should be reworded to include the phrase “be authorized to expend funds,” because omitting that phrasing could force the city to only use money from the capital improvement fund for raw water line debt. “This might be nitpicking, but without this phrasing I am worried we are going to have to use the money for the water line debt,” Woodbury said. “There is a lot of competing interest for capital improvement fund money, including needs voters have already approved. Just add be authorized to, so we have the option of accelerating another need down the road.” Councilman Duncan McCoy said he supports using the money to pay off the debt service. “I think any time you can pay off debt early then that is an option we should take.” The tentative ballot question does not state a set amount of money that will be taken from the fund, but Krumm said that a set amount could be an option.

“The question does not put a dollar amount, but we can put a dollar amount if needed.” The capital improvement fund is funded primarily through the sale of city-owned land and lease revenues, with 100 percent of land sales revenues and 20 percent of lease revenues going into the fund.

The city currently has $1.8 million tentatively budgeted for fiscal year 2017; however, the city expects more income from solar companies for land deals in Eldorado Valley.

In other actions, Amended an agreement between Solar Power LLC and Solar II LLC to share a supply of water to help run both companies’ renewable-energy projects. Woodbury said, “It is great to see our solar companies in the valley working together.”

Shared its support for closing the online sales tax loophole. The loophole refers to out-of-state online businesses who don’t pay sales tax in Nevada but do a large amount of business here. City Manager J. David Fraser said that it is unfair to brick and mortar businesses to pay their fair share of sales tax, but exclude online companies.

Contact reporter Max Lancaster at mlancaster@bouldercityreview.com or at 702-586-9401. Follow him on Twitter @MLancasterBCR.