GREENSBURG CITY COUNCIL MINUTES

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					                                   GREENSBURG CITY COUNCIL MINUTES
                                            Regular Meeting
                                              July 6, 2009

          The Greensburg City Council met in Regular session Monday, July 6, 2009, Mayor George Cheatham
presiding with Council Members, Brenda Patterson, Bill Moore, Jerry Cowherd, Steve Stone, Sandi Moran and Bill
Taylor.

          Mayor Cheatham asked the council for comments regarding the minutes of the June 1, 2009 Council
meeting. Having no questions or comments, Jerry Cowherd made motion to accept the minutes as read. Motion was
seconded by Sandi Moran. All members present voting aye; minutes were approved as read. Mayor Cheatham then
asked the Council for comments regarding the minutes of the June 11th Special Called meeting; having no comments,
motion was made by Bill Moore to accept the minutes from the Special Called June 11th meeting as presented; motion
was seconded by Brenda Patterson. All members present voting aye; minutes approved as read. Mayor Cheatham
then called for a vote regarding the June 22nd, 2009 Special Called meeting. Bill Taylor made note of a correction to
the minutes; the minutes presented stated that Taylor cast a no vote, when in fact, he cast a yes vote. Taylor made
motion to amend the minutes, motion was seconded Steve Stone to approve the minutes for the June 22, 2009 Special
Called Meeting. All present voting aye, ayes have it minutes passed.

          The first item of Old Business for the Council’s consideration was an update regarding the City’s
Property/Liability/Workers Comp Insurance. “I’ve contacted five or six communities inquiring about any recent changes
they had made & discovered that many of them reported they had changed in the last couple years”. Most stated that
there was really no one reason, but mainly because of the way claims had been handled. Based on that information
and the cost savings of just over $34,000, I went ahead and contracted with Trident & KEMI for the City’s insurance
package for the FYE 2010. Mayor Cheatham also addressed the health insurance issue. There are basically two (2)
reasons another Special meeting was not called in July regarding the current health insurance. First because it was
discovered that the City would NOT be locked in now for a January 1, 2010 change. Secondly, the other company was
looking to quote Blue Cross/Blue Shield. The Mayor told them that there was no need in checking with Blue
Cross/Blue Shield, because the local hospital doesn’t accept it. The Companies are now focusing on Humana and
United. Hopefully, sometime in the next 3 or 4 weeks we will have numbers for reference. As long as we give the state
60 to 90 days and completed our three year commitment, then we can make any change at any time there after. We
are well past that 3 year time frame. If we find something as good as that and cheaper we will entertain that as it
comes up.

          The second item of Old Business was a discussion regarding the Operation and Maintenance proposed rate
increase. Mayor Cheatham included the basic information with the exception of two other documents; that were
included in your packets; Council member Brenda Patterson inquired about the water consumption and how we
determined which department is charged with any particular expense or credit. Mayor Cheatham explained to the
Council that he had pulled information from the 977 residential customers currently being serviced by the Greensburg
Water & Sewer departments. The minimum customers 0 – 2000 gallons of water) account for 32.55% of our
customers; customers using 2000-3000 gallons make up 17%; the breakout is continued for customers using 3000-
4000 gallons. Customers using 4000 gallons or more account for 35% of the City’s customers. The remaining
customers using 10,000 and above, include the consumption we sell to Green-Taylor’s.

            Bill Moore asked if the total included sewer rates;” those figures include all water consumption processed by
the City”, stated Cheatham. Council member Bill Moore stated that he understood that the City has to be able to
operate with not only the revenue needed to cover the basic costs; but enough to cover the rising cost of repairs and
maintenance to the system. The General Fund is solid enough to carry the burden for a while; however, according to
the Bond Ordinance, the City’s water & sewer system MUST become independent of the General Fund. If we initiated
a rate increase that becomes effective immediately for our current customer base, then the rate would also apply to the
water the City sells to the Green-Taylor Water District. The difference is that Green-Taylor has the right to dispute the
increase by going to the PSC. The City tried to increase the wholesale rate in 2005; however, the Green-Taylor Water
District disputed the charges and the Division of Water & PSC declined the increase. The same thing applies to the
current rate change plan; Green-Taylor can appeal the rate by going to the PSC, and by so doing would leave the
increase in place for our current customer base. “I understand that these are hard times everywhere, not just
Greensburg, but Nationwide”, stated the Mayor. If Green-Taylor contests the charges, which based on their history,
they will. Council member Bill Moore inquired if we should initiate the proposed rate increase with Green-Taylor before
applying it to our customers. Mayor Cheatham responded that PSC will not grant a rate increase to one entity; the
increase must be applied to the City’s entire customer base. Ronnie Grant pointed out at the last meeting; that if
Green-Taylor contests, then it may take six (6) months to receive a decision from the PSC. If the PSC grants the
request, then the rate will be retroactive to the August 1 st, 2009 effective date that was applied to the City’s customers.
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           Brenda Patterson inquired if the rate being discussed was in fact, the rate stipulated in the new Ordinance.
Cheatham explained that the rate is clearly stated on the second page of the Ordinance. The new rate increases our
current rate to Green-Taylor from $1.834 to $2.20. Bill Taylor inquired is the rate increase would cover our cost?
“Based on the numbers that Bell provided from the study they did three (3) months ago, the increase would allow us to
just be at a break even point”. Grant explained.

            Eddie Wright and Gordon Price updated the Council as to what has been happening at the plants since our
last meeting. At the last meeting, Eddie updated the Council on the equipment that was down, the serious nature of the
issue & what the Division of Water expected the system to do to repair or replace the equipment to keep from being in
violation. A few days after the July 6th meeting, Gordon reported that the Water Plant had received the results from the
last e-coli test. These numbers put us over our magic number of 1300; which means we will have to start doing crypto
testing in September. Crypto testing can be done in a couple of ways. One (1) spanning 24 tests over two year period,
or two (2), 24 tests in a one year time frame. Either way the cost is going to at the least, double. If we go with McCoy,
their rate is $14,100 which covers complete testing and reports. We pull samples, and McCoy’s picks up the sample.
Gordon Price explained that the e-coli will come through the water from farmland run off, animal waste and human
waste, and if the river is clear, then you won’t have problems with e-coli. When the river is up, then the plants are
pulling directly into our collection system. We are equipped to filter out and kill all the e-coli; however, the Crypto you
can’t kill.

           Larger water plants have already been doing the Crypto testing for approximately the last 4 years. The
requirements will begin to filter down to the smaller plants in stages; right now it is hitting us. At the Mayor’s request,
Gordon also called an independent lab in Indiana to inquire about their testing; they send us all the stuff to do it with.
We collect the sample, put it in their cooler; they pay for the shipping and ice packs for $9500. That is the complete
outfit. We have to do 2 extra samples here in time for high turbidity. When the river really gets muddy we’ll have to pull
a couple samples. We can do that over a period of 24 months or 12 months. If we do 12 months we have to do 2 per
month. As of today we also have a 2% rate increase on chemicals. Bill Moore and Brenda Patterson said they were
against raising the rates, and are definitely against the 20% increase in order to bring the rates up-to-date.

          A few of the council members inquired to why we have to raise our rates at this time and place the burden on
our customers. “These changes are necessary because the State mandates that the testing and operating
requirements be met regardless of the financial burden”, stated Mayor Cheatham. Council Member Sandi Moran said
she had received several calls regarding the rate change and asked if the City of Greensburg could cut costs in
another places.

          Mayor Cheatham stated that he didn’t disagree that the City should have been raising rates to keep up with
the cost of inflation; however, we can’t go back, we can only move forward. Short of doing drastic cuts within the
Operation & Maintenance system, we have no other resource for the revenue needed to complete the necessary
repairs & maintenance to the Water Treatment and Waste Water Treatment plants. Council member Brenda Patterson
asked if we could use General Funds to make the repairs. “It is illegal for the General Fund to float the O & M
operation for an extended period”, Cheatham stated. Not only is it illegal, but it is not appropriate to use the General
Funds to cover the costs and the burden of maintaining other City services.

           We can talk all night about “what if and should haves”, but bottom line is that the Operation & Maintenance
side of the business must increase their rates in order to maintain the systems properly and keep out of violation with
the Division of Water. Gordon Price reported that the Water Plant was pumping 20 hours a day just to keep up with the
demand from Green-Taylor. We are obligated contractually to provide the Green-Taylor system with 15 million gallons
a month. We pumped 32 million gallons last month, and Green-Taylor used 16 million. Normally our consumption is
not that high. It just so happened that this month, Green-Taylor & the Greensburg Water & Sewer System used the
same amount, 16 million gallons. Normally, the city uses half what Green-Taylor uses. Bill Taylor asked if the City had
any other solution other than raising rates across the board. “Upgrading our current rate system is the only avenue for
the systems to collect revenue sufficient to cover the daily cost of repairs & maintenance and replace failing equipment.

          Bill Moore made motion to table the reading until the next regular meeting; motion was seconded by Sandi
Moran. Having a motion and a second, Mayor Cheatham then asked for comments or questions regarding the
Ordinance. Council member Steve Stone stated that if so many of the citizens were against the increase, why they
had not come forward in the meeting. Having no more comments, Steve Stone made motion to roll call the vote.
Motion was seconded by Sandi Moran. Deputy Clerk, Kim Henderson called the roll for the votes. Bill Moore yes,
Brenda Patterson yes, Steve Stone no because as he previously stated, no citizens had presented themselves at the
meetings to contest the rate increase; Jerry Cowherd no, Sandi Moran yes, Bill Taylor stated the he did not think that

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the City would accomplish anything by waiting 30 days, thus casting a yes vote. Having a tie vote, Mayor Cheatham
exercised his right to break the tie, voting yes. Motion to table was defeated.

          Council Member Brenda Patterson asked what procedure we follow if Green-Taylor contests the rate
increase. “They will file a complaint with the PSC, and then PSC will notify the City that we cannot enforce the
increase to Green-Taylor until a hearing has been scheduled with PSC, Green - Taylor & the Greensburg Water &
Sewer System. We will have to go through the process of putting together material, including numbers that justifying
the increase and present those facts at a hearing. Council member Sandi Moran asked how long the process would
take. The Mayor stated that it could take (3) three to six (6) months. “This increase will solve some of the problems
inside the O & M operation, assuming that the cost of living is enacted going forward”, Mayor Cheatham explained.

          Bill Moore made a motion for a roll call vote on the ordinance to increase rates by 20%. The motion was
seconded by Steve Stone. Bill Taylor made a motion that the increase be amended to 15% and seconded by Jerry
Cowherd. A vote was called for on the motion – Bill Moore voted yes, Brenda Patterson voted no, Steve Stone voted
no, Sandi Moran voted no, Jerry Cowherd voted yes and Bill Taylor voted yes – thus resulting in a tie vote. Mayor
Cheatham stated his desire that the rate change be worked out between the members and elected not to vote thus
allowing the motion to die. After further discussion on the issue and being a motion on the floor for a roll call vote a
vote was held – Bill Moore voting no, Brenda Patterson voting no, Sandi Moran voting no, Steve Stone voting yes, Bill
Taylor voting yes, and Jerry Cowherd voting yes.

           Again being a tie vote the Mayor elected to vote yes thus breaking the tie and passing Ordinance Number
2009-0706. In explaining his vote, Mayor Cheatham made the following statement, “Without the increase for the
system, the current revenue base is not sufficient to carry the cost of increased testing; chemicals, repair &
maintenance, and the system might possibly have to lay off one (1) to two (2) employees. For a system operating on a
skeleton crew this is not a feasible option.” Brenda Patterson inquired how the City could know the approximate dollar
figure without knowing how the increase would result with Green-Taylor’s situation. “Mayor Cheatham responded that
without the increase we simply do not have sufficient funds to employee a full team of nine (9) employees.

           Council member Bill Moore stated if this is true, why hasn’t the public been made aware of how bad the
City’s finances are? Cheatham stated that financially the General Fund is solid; however O&M has not been solid for
many years, and everyone from the Council to the Mayor has been aware that this day would come. The Water
Treatment Plant & the Waste Water Treatment Plant are aging, as is their equipment. Unfunded mandates from
Frankfort & Washington have placed a heavy burden on small rural cities that basically have no other avenue for
increasing the revenue base without raising the rates. We have talked about this problem at length; discussed the
issues and reviewed the solutions; now it’s time we have to stop talking, and take action. We need to start talking to
every Senator and Representative in Frankfort, and beyond to get the attention & assistance we need for funding a
new plant. We don’t need to discount the issues at hand however; a new plant would not do anything to solve these
problem areas in the water system and on the sewer system side, we have to solve the I & I problem we currently
have. We cannot expect the old lines already in place to hold up under a new plant. They simply cannot hold; they will
not withstand the pressure. The State is not offering ten (10) to twelve (12) million dollars for a new plant, and the
Greensburg Water & Sewer System not having to borrow at least six (6) to eight (8) million dollars to completely fund
the construction cost. Without updating the I & I issue, the only thing a new plant will solve is the water capacity
problem and that is not a city problem. It is a Green-Taylor problem.

           The next item of Old Business was a discussion regarding 911 and the current outstanding balance of
Seventy-one thousand dollars ($71k). The Council’s meeting packets included a legal opinion from J D Chaney, legal
counsel for the Kentucky League of Cities about the idea of changing the $2.00 phone landline charge away from the
phone company, and placing the charge on utility bills. The PSAP Board can place the surcharge on the utility bills
from the City and Green-Taylor; apparently the state statue language gives them the freedom to come up with any
funding magnesium they so chose. Mayor Cheatham stated that he had talked to some of the magistrates and they
were in favor of placing the surcharge on the utility bills and removing it from the phone bill. Green-Taylor would have
to sign off on it and agree that they are willing to work with the PSAP/911 Board in order for this to work. In an effort to
lighten the financial burden of 911, a few of the Magistrates suggested that the City Council meet with Green County
Fiscal Court about this option. Both systems would have to calculate the number of meters on the books, times the
two dollar ($2.00) surcharge to see if this change would make a big enough difference for the 911 revenue. The City of
Greensburg has issued a credit of seventeen thousand, five hundred dollars ($17,500) to the Fiscal Court instead of
issuing a check to them, while the City waits up to six (6) weeks to be reimbursed for 911 expenses the City has
already incurred.

         Having no more Old Business, the Council moved to New Business. The Council was presented with a
Code of Conduct Resolution, in regards to the Housing grant applications, with a zero match. Motion was made by
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Sandi Moran to adopt the resolution; motion was seconded by Steve Stone. All members present voting aye, motion
passed. Judy Weatherholt also brought to the attention of the Council, two (2) Housing Resolutions that the City has
applied for in grant funding. The grants would allow for the construction or demolition of abandoned & blighted
property. These are “no-match” grants made available to the City. Qualifications include that the owner be under the
threshold of 120% of low to moderate income standards in order to qualify for a mortgage. The first Resolution is for
the Governor’s Office of Local Development, Neighborhood Stabilization Program Two Grant in the amount of
$500,000. Bill Taylor made motion to adopt the Resolution, motion was seconded by Sandi Moran; all members voting
aye, Resolution adopted. The second Resolution was a USDA Rural Development Services Office for a Housing
Preservation Grant in the amount of $500,000. Motion was made by Bill Taylor, seconded by Sandi Moran. All
members voting aye, The USDA Resolution is adopted.

           The second item of New Business was the acceptance of the 1996 Chevrolet Van surplus property by the
Green County Board of Education. The city currently uses the vehicle to transport six (6) inmates per day at no other
cost to the City to utilize labor during the summer mowing season. The City does not have adequate transportation
and this surplus will be utilized in the City’s best interest. Steve Stone made motion to accept the surplus bus; motion
was seconded by Jerry Cowherd. All present voting aye, motion passed.

           The Mayor then presented the council with a letter from Todd Bloyd regarding repairs he has made to the
sidewalk at his property located on Durham Street. WHF, Inc. was awarded the construction bid on the current Water
Project Grant. Bloyd states in the letter that the construction company caused the problem. The subcontractor
advised Mr. Bloyd that they were not responsible for the damages. Bill Moore made motion to table the discussion
until the Mayor could respond to Mr. Bloyd, inviting him to the next City Council meeting to discuss the issue. The
Mayor stated that he would ask him to come before the council.

           Mayor Cheatham asked Alecia Absher, Legal Counsel for the City to advise the Council of the procedure
currently ongoing at the Vic Griffiths property. Absher told the Council that she had filed a petition asking the judge for
permission to access the land. Alecia stated that the City would have to wait ten (10) days after being served the letter
before a hearing date could be set. The judge has to set the hearing date.

           Mayor Cheatham then called upon Departments for their monthly reports. Judy advised council about the
Pride of Counties booth next month. Judy also reported that visitors have been coming to town (antique cars group &
civil war group) in groups of 50 to 55 people.

          Mayor Cheatham reported that the Youth Service Workers time was just about over, and he urged the
Council to make the effort to let the kids know what a good job they have done. They have definitely gone above and
beyond to assist with projects around the City and City Hall. They cleared the Records room at City Hall, put the
shelves together and have made efforts to help with that project.

            Brady reported that the third (3rd) Dodge was in repair, Brady also reported that one apprehension was still in
jail, the bank robbers have been apprehended, and stressed that the City had an increase of thefts over the last few
weeks - everything from medicine and other items being stolen from unlocked cars. Gordon Price reported that the
water loss for the month was 2.99 %, the flocculator had been fixed; other than that, the plant is doing well. Roger
stated that things from his end were doing well; they had one incident on Winding Stair Hill, three (3) leaks in the last
two (2) weeks because there had been too much pressure on the old lines. Eddie Wright, Director of the Waste Water
Treatment Plant reported that considering most of the equipment was inoperable; the plant was operating fairly well.
The fecal level was up, it’s hard to contain the incidents and treat the issue because of the heavy rains. DOW has
been working with us trying to find a solution to the problem. One recommendation is to put an automatic feeder to
feed chlorine automatically according to the flow. Our options are either pay for the Chemicals, or pay the fines. Police
Chief, John Brady reported that the KLEFPF audit out of Richmond had been completed, without any violations.

           Having heard from each department, Mayor Cheatham asked the Council for their concerns. Jerry Cowherd
asked that the City & Council recognizing Reagan Deaton for her accomplishment as a State Champ. Sandi Moran
inquired about the sidewalks in front of the Baptist Church; asking if we were going to place pavers in the area; or if
there were other plans for the area. Mayor Cheatham said that the area would be completed shortly. Mayor
Cheatham explained that the date for Mont’s retirement celebration had not been rescheduled; however, the same
plans as before will still apply. The employees and Council Members will have breakfast with him the morning of the
date, and then there will be a public show of appreciation on the square around 10:30. We are currently working with
Kelvin to coordinate all those involved. As soon as we set a firm date, we will let you know.

        Having no more business for the Council to consider, Bill Taylor made motion to adjourn, motion was
seconded by Jerry Cowherd. All present voting ayes; meeting adjourned.
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