Auditor urges Bessemer to seek joint ventures

By ALISSA PIETILA

apietila@yourdailyglobe.com

Bessemer - The Bessemer City Council met Monday night to hear the recent audit report, as well as look at old business surrounding a water leak detector, excavator and Eagle Waste.

Christina Smigowski, of Rukkila, Negro and Associates in Houghton, presented an auditor's report which said they did not find anything wrong with the city's financial reports.

Smigowski encouraged the city to keep pursing joint ventures, as "the state of Michigan has encouraged municipalities to form joint ventures which provides a cost saving on expenditures."

"The city of Bessemer has done a wonderful job with forming these joint ventures," she said.

Smigowski said, "The one thing I want to do is strongly encourage that you utilize these services provided by the joint ventures to support your investment in them. And by utilizing these services, the city's money is being reinvested in the operations of the joint ventures."

The report was approved by the council with no opposition.

Old business

The council discussed whether to purchase a water leak detector for the city or not.

Mayor August "Butch" Semmerling asked, "Is it a want or a need?"

Councilman Doug Olsen said, "I don't believe it's an immediate need" and, "I believe we have time to find one ... could put it in the new budget."

According to city manager Mike Uskiewicz, the one they have been testing and using is a demo model, but it in "like new" condition, and if purchased it also comes with a 5-year warranty.

After a bit more discussion, the water leak detector was approved to be purchased for the amount of $3,150 from HD Supply Waterworks, Ltd.

Semmerling also mentioned that the borrowed excavator, a hot topic at the last meeting on Nov. 3, was not purchased and was sent back.

There was also a small discussion about comments heard about Eagle Waste and possible issues with snow plowing.

Most said they had not heard bad comments, but council member Linda Nelson said she had heard a few about how placing the bins out so early makes snow removal difficult.

Manager Uskiewicz said he would talk to Eagle Waste to see if their drivers have had any issues.

New business

In new business, the council looked at a payment agreement with C2AE for the wastewater project. Grant and loan funding has already been secured for the project.

The agreement defers the cities payment of fees or services until after the grant and loan closing, set to occur in 2015. The fees total $393,500.

The Gogebic Range Water Authority already set aside funding on Nov. 13 to make payments to C2AE for the water side of the project.

The payment agreement with C2AE was approved with some opposition

The council also reviewed a revised contract with BASA, which is needed for a sewer loan the city will be taking out.

The loan amount is for $3 million with a poverty rate for 40 years, which is tied to the $5,265,000 Rural Development grant for sewer work.

BASA had a meeting on Nov. 12 regarding the contract extension, which will extend the current agreement for 42 years from the effective date of Nov. 17, 2014. The extension would provide an adequate timeline in case the loan closing gets delayed for any reason.

The council approved the amendment to the Sewer Treatment Contract with BASA to satisfy the loan requirement for Rural Development Funding.

Semmerling introduced the evaluations of both Uskiewicz and Jim Trudgeon as manager and clerk, respectively, and said they have the option to have them presented in open or closed session. Both chose closed session, so discussion of their evaluations was moved to the final part of the meeting.

Uskiewicz also presented his managers report.

Included in the packet, was grant funding that has been secured.

This includes a FEMA grant of $62,508; the State Grant for Flood of $10,418; a Trust Fund Grant for $45,000; Act 19 Funding for $92,252; Michigan Economic Development Corporation funds of $615,743; Michigan Department of Transportation funds totaling $85,000 and the Rural Development funding for $5,625,000.

The city also secured loan funding for improving infrastructure totaling $6,465,000 at a locked interest rate of 2.375 percent for 40 years.

In total, $13,000,921 will be invested in the community, the report said.

Councilman Al Gaiss said this is the best number for funding he thinks the city has ever had.

"It's like $6,800 per house" in the city or "$3,815 per person," Gaiss said.

Nelson and Uskiewicz also had a disagreement about one of the grants, and could not come to a consensus.

"We'll agree to disagree," Uskiewicz said.

The two also disagreed on water plant operations and the alarm system at the facility.

Usciewicz also talked about the possible energy crisis in the U.P., just mentioning the city could possibly be affected. He encouraged everyone to keep up-to-date on the issue.

There was also some public comment regarding this, as well as the roads that will be fixed with the approved funding.

The meeting then went into closed session to discuss the evaluations of the city manager and clerk.

The next meeting will take place on Dec. 15 at 5:30 p.m.