From the July 25 City Council meeting. For minutes and schedule, visit springfieldmo.gov/citycouncil.
Springfield City Council members are seeking to clarify the terms of a 1999 agreement with Wonders of Wildlife to restrict how the museum spends hotel-motel tax dollars.
City staff originally interpreted language from a 1998 ballot initiative to craft the agreement that allowed tax revenues to be spent on educational programs. But following a July 11 report from Internal Auditor Kristy Bork re-examining the original ballot language, city officials are proposing a new agreement that would restrict hotel-motel revenues to funding capital improvement projects.
On July 25, council held a first reading for the special ordinance that would present the new agreement to museum officials, and it unanimously approved an amendment requiring WOW to present annual reports to the city on its use of hotel-motel tax funds. The museum has received at least $300,000 in hotel-motel tax revenues in each of the last three years, according to Bork’s audit, her first project since taking the internal auditor position in October. The report, which was issued to council’s finance committee, is posted to
www.springfieldmo.gov.
In City Manager Greg Burris’ explanation to council, he said, “The funds paid to WOW since 1998 have been used consistent with the agreement.”
Bork said the ballot language specifies that those tax funds be designated only for capital grants, which can then be used for capital improvement projects.
“The agreement basically would become more specific in saying that (WOW) would have to use the funds for capital purposes,” Bork said after the meeting.
Council members had requested museum officials direct hotel-motel funds to educational efforts through partners such as the Missouri Department of Conservation and Springfield Public Schools. City officials had been reviewing the museum district’s use of public funds following delays in the renovations taking place at WOW, which have been in progress since December 2007.
Peggy Smith, museum executive director, told Springfield Business Journal in March that more than $1 million in hotel-motel funds the district had received since the closure of the facility had been used for educational purposes, in line with the council request.
City Attorney Dan Wichmer said the first part of the 1998 ballot initiative indicates funds should be used “to promote recreation, education, tourism and the local economy,” suggesting that money could be spent by WOW on educational efforts, thereby influencing the language of the 1999 agreement. However, after Bork examined the ballot language, she determined that the second part of the 1998 ballot indicates funds should only be dedicated to capital grants for WOW and other nonprofits such as the Discovery Center, which also receive the tax funds.
“There hasn’t been a situation where we thought the money wasn’t being used in accordance with the contract,” Wichmer said, adding WOW officials had been notified about the issue and indicated they are willing to use the funds in accordance with Bork’s recommendations.
Wichmer said he “didn’t disagree” with Bork’s interpretation of the ballot language.
At the meeting, Councilman Nick Ibarra asked who was to blame for misinterpreting the 1998 ballot language and drafting the agreement that followed.
Burris said city staff and the council members who signed off on the agreement were ultimately responsible. “It’s us,” he said.
The proposed ordinance for a new agreement with the city will receive a second reading and may be voted on Aug. 8.
Credit rating jump
After holding an Aa2 rating since 1998, Burris told city council members July 25 that the city’s bond rating had improved to Aa1. The Aa rating is the second highest – next to Aaa – under credit rating agency Moody’s ranking system for municipal bond issuers.
According to
www.moodys.com, issues ranked Aa demonstrate “very strong credit worthiness relative to other municipal or tax-exempt issuers.”
Burris said a letter from Moody’s praised the city’s efforts to reduce its fiscal 2010 budget by $4.5 million and fund the police-fire pension shortfall in the middle of a recession. Burris said the new rating would mean lower interest rates the next time it seeks to issue a bond.
Mike Brothers, co-interim director for public information for the city, said Moody’s letter indicated that the area’s solid economic base also factored into the increase. Brothers said the new rating wouldn’t apply to bonds already issued.[[In-content Ad]]
