City Beat: Council considers utility budget, rate hike

Springfield City Council on Sept. 15 considered the utility’s proposed fiscal 2009 budget, which includes a second, revised request of a natural gas rate increase. The budget, approved by the Board of Public Utilities on Aug. 28, requests $752.6 million for the fiscal year, which starts Oct. 1. That amount, excluding $243.8 million for the Southwest 2 power plant expansion, is up nearly $30 million, or 6.2 percent, from this year.

In April, council asked CU to go back to the drawing board with its original rate hike proposal, which would have increased base rates by 4.1 percent. The new proposal would increase rates by 2.5 percent in April 2009, with an additional 2.5 percent jump in October 2009 and another 2 percent increase in October 2010.

The utility maintains that the additional money generated by the increase is needed to offset costs of continued maintenance and mandated upgrades to the gas system, as well as to meet the state auditor’s recommendation that the gas service not be subsidized by revenues from electricity customers.

While both CU and some consumers said the revised proposal is less harmful to individual customers, several members of the public said the new budget doesn’t do enough to cut excess spending or postpone projects.

“You as a council face decisions where good necessary features are mixed with frills and wants,” Springfield resident Carl Herd told council. “For making some cuts and incremental changes, CU should be complimented, but they did not do enough.” Nine speakers – a combination of utility leaders and residents – were in favor of the proposal, while five spoke in opposition.

Council is expected to vote on the proposed budget at its Sept. 29 meeting.

Downtown land sale

Council also considered a bill to give the city manager permission to execute several documents related to the sale of the Jordan Valley Car Park and the adjacent former arena site. City Economic Development Director Mary Lilly Smith said the sale is part of the development agreement between the city and John Q. Hammons to build a new hotel on the arena site.

Hammons is buying the car park and the vacant site for $7 million, allowing the city to retire its debt on the structure, and the city will own the land across the street where developer Opus Northwest is building a new headquarters for accounting firm BKD.

As part of that agreement, the city also has agreed to waive a requirement that Hammons add 80 rooms to the University Plaza Hotel, as plans for the new hotel call for 150 new rooms.

The physical progress of that development agreement was visible Sept. 17, as BKD broke ground in the University Plaza parking lot for its new four-story, 109,000-square-foot headquarters.

A related item on the council agenda would create a pedestrian easement on the property at 300 S. John Q. Hammons Parkway, to the east of the BKD site, which would allow for easier access to the parking deck.

Wellington South

Also on the council agenda was a planned development for Dining by Design owner Ryan Tiller.

Tiller, who already operates banquet facility Wellington Place above the downtown Gillioz Theatre, spent $1.2 million to purchase and renovate 5021 S. National Ave. It now houses a 100-seat banquet facility dubbed Wellington South, along with the headquarters for his Dining by Design catering business and a retail bakery called The Pie Shop.

Tiller said the location of the property, formerly a Family Video location, made it particularly attractive.

“Everything seems to be growing down National toward us. It’s going to continue to increase our visibility here,” Tiller said. “I needed the high traffic, but I also wanted something that wasn’t right in the middle of everything.”

Council’s approval would allow Tiller to serve liquor by the drink at the south location, as well as prohibit outdoor dining or other activities – a concession to concerns by neighbors about the impact of the proposed development.

Councilman John Wylie was impressed by Tiller’s willingness to compromise with his new neighbors.

“This has been a property that has sat vacant for some time – it’s a very nice looking building and lot – and it needed to be put to use,” Wylie said at the meeting.

Council is expected to vote on the downtown land sale and Tiller’s rezoning request at its Sept. 29 meeting.[[In-content Ad]]