The three new Chanute City Commissioners wasted no time at their first Monday night meeting in taking steps to fulfill their campaign promise to let the public vote on the controversial Fiber to the Home plan. With their lead, a proposal to direct the city’s staff to stop moving forward with a $16.4 million bond issuance for the plan passed with a 3-2 vote. This puts the immediate future of the city’s current plan in limbo.
It happened mere minutes after Tim Fairchild, Phil Chaney and Randy Galemore were officially sworn in as commisioners. The Commission quickly reorganized, with Fairchild unanimously voted as the city’s mayor and Chaney as the vice-mayor. Outgoing Commissioners Martha McCoy and Kevin Berthot and Mayor Greg Woodyard all received plaques and were recognized at a brief reception honoring their service to the city.
Fairchild complimented these outgoing commissioners, saying that he really appreciated them, that he knew their hearts were with the city, and that anyone who sees them around in public should shake their hands for all they’ve done. The outgoing commissioners gave short speeches thanking the citizens of the city and expressing hope for continuing in a progressive direction.
With the ceremony done, Fairchild asked City Attorney David Brake what would have to be done to kill the upcoming bond issuance.
The new mayor tried to ask this a number of times in a number of ways. He was assured that the bonds hadn’t been issued yet and couldn’t be without a vote by the Commission.
City Manager Jeff Cantrell asked the new commissioners for direction on an application project currently in front of the Kansas Corporation Commission to secure a $508,000 grant for the fiber project. Chanute has hired attorneys to work on this issue. Cantrell pointed out that there is no strict obligation to use the funds received, but that it dictates that the project be completed on a certain timeline. The grant is to be used for a backbone of fiber that can then be extended out to surrounding rural areas.
Galemore was opposed to any plans to build fiber outside of the city, calling it putting the cart before the horse.
“We should be taking care of the people in the city first,” Galemore said.
Fairchild asked if this grant was dependent on the bond issuance. Galemore asked how much the city was paying these attorneys. The reply was that the attorneys were collecting about $10,000 to secure this $508,000 grant. Chaney asked if this money had come out of the city’s electric utility, and was told that it had.
“If we don’t file soon, that money will be gone,” Cantrell said.
He also mentioned that additional operating assistance in the hundreds of thousands of dollars would also be available to the city under this grant, and that the $508,000 hadn’t been figured into the business model for the fiber plan.
Chaney said that the Commission needed to step back and take a look at the plan as a whole before agreeing to this, mentioning a $600,000 shortfall that developed between revenues and expenses in eight years of the city offering fiber to local businesses. Commissioner Tim Egner suggested that this was an investment instead of a loss but Chaney answered that the money was gone from the electric fund all the same.
Commissioner Jim Chappell repeatedly told commissioners that they weren’t up to speed on the specifics of the fiber plan and that they should wait to learn more about it and how it could benefit citizens of Chanute before killing it outright. He compared fiber to electricity and water, another way to both benefit citizens and make money for the city.
Galemore expressed a view that the government shouldn’t be in these types of businesses, pointing out that plenty of cities have these types of services without running them.
Chappell also advised the new commissioners to take a retreat with all department heads to learn what they spend money on and why that is necessary.
Egner mentioned that the cost of sending high-speed iInternet to Erie was on pace to be paid off in five years and said that would eventually offer Chanute a healthy return on its investment. He said it was unreasonable to expect this kind of business to so quickly be able to stand on its own.
Fairchild expressed that the majority of people in the city don’t want to add to its debt, and wanted the highest level of assurance that no bonds would be issued for this project by the city. He made a motion to stop such an issuance.
Cantrell again asked about the application before the KCC and what should be done about it.
Fairchild asked if this process was completed and if the fiber plan was passed by a vote of the public, would those funds still be available. Cantrell answered that they would.
This prompted a 3-2 vote to move forward with the application to the KCC, with both Galemore and Fairchild casting dissenting votes.
Cantrell then told commissioners that the bond issuance is in a two-week holding pattern, and that there was not much point in going forward with it if a consensus of commissioners is against it.
The commissioners voted 3-2 to stop moving forward with the $16.4 million in bonds, with Chappell and Egner voting no.
Woodyard expressed his disappointment with this, stepping to the podium to express that the city would only need a 35 percent take-rate with smart meters in the plan. He advised commissioners to educate themselves about the project.
Bernie Neyer stepped to the podium to advise commissioners to pull the fiber funds out of the electric utility, saying that its cost should have to be accrued to the specific product. This would allow citizens to better understand the financial numbers for it, according to Neyer.
The new commissioners eventually took Neyer’s suggestion at the end of the meeting, voting to separate the funding of fiber from the electric utility going back a year. They believe that this will allow them to get a truer picture of the project’s financial viability. The measure passed 5-0.
Cantrell invited commissioners to a work session with one of the originators of the business model for this plan, an Alcatel-Lucent representative from New York. Cantrell said this individual really helped him understand the plan when he was first starting as City Manager. Chaney expressed skepticism about the city paying outside experts, who he believes will say whatever the entity hiring them wants to hear.
Cantrell answered that this particular outside expert would be bringing tools that show the specifics of this business model. Fairchild stated that there were certain experts that the Commission would rather not have back, which drew applause from the some people in the audience. This was a thinly veiled reference to Mikel Kline, a project manager from Sega who the city hired to work on the fiber plan and who made several controversial remarks in the Tribune in the week before the election.
Questions were asked about how much this consultant from Alcatel-Lucent will get paid to be at this meeting, but it was decided that the information that is presented could be valuable. A work session on this was scheduled for Wednesday, April 22 at 6 p.m.
Fairchild also asked if there could be some context added to the Warrant Registers that are sent to commissioners before every meeting, outlining what the city has paid for that month. Fairchild wanted to see a budgetary line item included with the entries on this list, to increase accountability of the city government and public interest in how much money is being sent.
Galemore asked about the Southwind Energy Group, a consortium of cities (including Chanute) that pools utility resources. Galemore wanted to know why Chanute was paying phone bills for this group. City Manager Cantrell said that he would find out and volunteered to answer any questions that the new commissioners had in a work-session setting. Galemore expressed hope that these proposed sessions be recorded and broadcast to citizens.
Chaney asked for a tour of the Stone Creek Golf Course so he could see the work done and the money spent on the demolition of its original pro shop and the renovation of its clubhouse. He also asked for a copy of the latest engineering report on the western wall of Mel’s Southside Tavern. Cantrell replied that he had received a report last Friday, but that it did not contain as much information as the city would have liked. For instance, it did not contain any cost estimates to actually fix the wall. He said he shared that information with the building’s owners.
“We need more information,” Cantrell said. “It’s kind of a complex issue, unfortunately.”
This is expected to be among the issues addressed at upcoming work sessions. Earl Bartholomew, one of the co-owners of Mel’s, expressed an interest at this meeting in attending the work session where this will be discussed.
Rules to use during the public comments section of the meeting were discussed and debated by the Commission, with Fairchild saying he considered this part of the meeting “sacred turf.” He encouraged citizens to speak their mind while observing basic decorum, but said he wouldn’t put up with personal insults and other shenanigans. He wondered if a time limit should be put in place and if commissioners should directly respond to the comments offered by the public.
Chaney said he would like the opportunity to respond to citizens who ask him questions, as long as they don’t get too combative and argumentative. He also asked about the possibility of moving public comments to the end of the meeting, but was told that the current system exists so people can say what they have to say and leave early.
In other actions, the Commission:
• Conducted a public hearing on a fence that had been illegally built on an easement containing utilities close to the intersection of First and Western. The Commission voted 4-1 to not tear down the fence at this time, with Chaney dissenting. It was noted that the fence might need to be torn down in the future if there is any problem with the utilities and that a restriction be placed on the deed of the property stating this.
• Unanimously approved Neighborhood Revitalization applications for a property owned by Darin and Kim Luebbering and a the Pete’s gas station in the 700 block on N. Santa Fe.
• Voted 5-0 to enter into a new 5-year lease with the Chanute Historical Society for its museum in the Flatiron Building.
• Agreed to provide certification information to help Faith House obtain a federal loan.
• Passed a consent agenda that featured the closing of several streets around the Osa Martin housing development on the morning of April 25 for the Chanute Elementary PTO 5K Fun Run. This event is raising money for ground cover and a sidewalk for a new playground at the school.
• Proposed having Mayor Fairchild write a monthly column in the Chanute Tribune and putting a Mayor’s Suggestion Box at City Hall.
• In his last official act as Mayor, Woodyard made a proclamation that April 25-May 2 will be Cherry Street Youth Center Awareness Week.