Sioux Falls water plant expansion should be bonded thru 2nd Penny
l3wis Sioux Falls water and sewer is funded thru enterprise funds (user fees). Those fees go towards maintenance, operation, general expansions and pipe replacements. They also go towards paying the salaries of the employees of this department (while all other city employees are paid thru the 1st penny operational fund).
While the concept of enterprise funds works well for normal operation, paying salaries and bond payments for major expansions out of this fund is what is draining the coffers and a cause for fee increases.
The 2nd Penny fund was created for road maintenance and soon got hi-jacked for all infrastructure projects. But that is what is it is for, major infrastructure like an expansion of our water and sewer plant.
This is really about allocation of tax money.
We say we need to pay down the bonds for this facility with user fees but we don’t use user fees to pay down the bonds for the Events Center, Pavilion, Zoo, Tennis Courts, Midco Aquatics and the list goes on.
It is ludicrous to have $80 million in a reserve fund for infrastructure projects while raising water rates to pay down bonds for a needed infrastructure project.
Huh?!
Why not re-finance the bonds thru the 2nd Penny fund and avoid a water rate increase? I wonder what Bloomberg thinks of that?