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Up to residents to decide what level of services they desire, mayor says


February 16, 2005 - By MIKE ANTHONY

Executive Editor

Crestwood residents will decide what level of services they want the city to provide when they consider a $6 million general obligation bond issue in the April 5 election, according to Mayor Tom Fagan.

Fagan's remarks were made last week during a town-hall meeting at the Crest-wood Community Center. The town-hall meeting was conducted by the city's Ward 1, Ward 2 and Ward 4 aldermen.

The Board of Aldermen voted 7-0 last month with Ward 3 Alderman Jerry Mi-guel abstaining to adopt an ordinance placing the bond issue on the ballot.

A four-sevenths supermajority vote will be required to approve the bond issue, which would increase the city's property tax rate by roughly 30 cents for a 10-year period until the bonds are retired. The city's current property tax rate is 25 cents per $100 of assessed valuation.

Approval of the bond issue would authorize the city to issue up to $6 million in general obligation bonds.

Proceeds from the bond issue would be used to allow the city to retire its line of credit with Southwest Bank, establish reserves sufficient to meet the city's cash-flow needs and reconcile debts the general fund owes other city funds.

While voter approval of the bond issue would authorize the city to issue up to $6 million in general obligation bonds, City Administrator Don Greer told the Call that the exact amount of bonds and the corresponding tax-rate in-crease would be determined if voters approved the proposal. The possibility exists, he said, that less than $6 million in bonds would be issued. If that occurs, the tax-rate in-crease would be less than 30 cents per $100.

During the Feb. 7 town-hall meeting, Fagan said, "... It seems to me as a city we have to look at things from a global nature, which is don't analyze one particular issue without analyzing the ramifications and repercussions of what happens on another issue and let me give you an example. With the police and fire protection and streets and keeping our homes up, I think it's a global picture that we have to look at. What do we do to advance this city ahead for the next five, 10, 15, 20 years? And it's something that we have to be concerned (about). We've been fortunate the past 20 years to have the mall to be the economic engine to drive this city, but ladies and gentleman, it's no longer the case ... I won't give you the exact percentage of what the mall's sales are down in the last four years. You would be astonished and not in a good way if you knew what the numbers were.

"When people tell you we have an economic problem, they are exactly correct. We've had some economic issues. I'm hopeful that we can turn things around with the right mix of redevelopment and new stores coming in with West-field redeveloping the mall and making some changes to it that it's going to benefit all of us in the next couple years,'' Fagan said.

Noting that resident Frank Spinner had asked a question about how the proceeds from the bond issue would be used, the mayor said, "He and I had lunch last Tuesday. We fundamentally disagree about the general obligation bond issue. I'm here to tell you tonight I don't like taxes. I'm a fiscal conservative. The last thing I want to do is raise my taxes or anybody else's. But you know what? This is what this city needs at this particular point in time. It's not the politically expedient thing for me to do. I'm running for re-election at the same time. You know what? I'm not a politician. I'm a lawyer by trade and I will continue to be a lawyer win, lose or draw on April 5th.

"But you know what? For this city to move forward, we need the bond issue to pass if we are going to maintain the same level of services that we currently provide. Now I know people may not want to believe that, but I'm telling you if you look at our numbers, if the bond issue does not pass and I'm not here to try to hold you hostage — like I told people at the town-hall meeting for Ward 3 on Nov. 15th, it's you guys who are going to decide how this city is going to be run after April 5th. If you want the same level of services, we have to have the general obligation bond issue pass. If you don't, then it's not going to pass. Then you're going to vote against it,'' Fagan said, noting a four-sevenths majority — 57.14 percent — is required to approve the bond issue.

"That's going to make it difficult, I can tell you. But you know what? It's something that if you can make the case, I'm sure the good citizens of Crestwood will analyze it and they'll decide what's in the best interest. Frankly, though, if you look at our expenses for the general fund, which is the major problem we have, if you look at the expenses, personnel costs are our biggest expense — police and fire safety. It's as simple as that,'' he said.

Noting that the Police Department's budget is about $3.1 million and the Fire Department's budget is roughly $2.5 million, the mayor said, "If we're going to make any substantial cuts, essentially it's going to have to come from probably those two departments. You can only cut so many paper clips, so many magazine subscriptions before you actually have to cut services. It's as simple as that. We have cut employees in the past couple years. It is something that you guys are going to decide.''

The owner of a $175,000 house currently pays the city about $83 per year in taxes "for what we provide to you,'' Fagan said.

"Obviously, if the general obligation bond issue passes, your taxes are going to go up and it's probably an additional hundred dollars ...,'' he added.

To determine the exact amount their city taxes would increase if the bond issue is approved, residents can visit the city's Web site at www.ci.crestwood.mo.us/ and click on the "Resident Impact Calculator.''

Approval of the bond issue would resolve the problems with the city's general fund, which first became public shortly after Greer, who has served as the city's police chief since 1990, was named city administrator in De-cember 2002. Greer continues to serve as police chief.

In January 2003, Greer told members of the Ways and Means Committee that while the Board of Aldermen was led to believe the city's general fund was balanced at the end of fiscal 2002, that was not the case.

Though the Board of Aldermen adopted a balanced fiscal 2004 operating budget in July 2003, during the preparation of an end-of-the-year budget adjustment ordinance designed to close out the city's fiscal 2003 books, city officials discovered that fiscal 2003 general fund expenses were slightly more than anticipated, while revenues, particularly those from merchant licenses, were far less than projected. A forensic audit of fiscal 2001 and fiscal 2002 was initiated after officials began an internal investigation into the accounting practices used by former City Admin-istrator Kent Leichliter and former Finance Officer Robert Wuebbels.

"As a result of our forensic investigative procedures, we have concluded that there have been a staggering amount of disbursements, improper journal entries and misrepresentations to the Board (of Aldermen) of the city's financial position, authorized by Leichliter and performed by both Leich-liter and Wuebbels, representing mismanagement of city funds and financial reporting errors,'' states the forensic audit report prepared by Brown Smith Wallace.

In November 2003, the city filed a lawsuit alleging that Leichliter and Wuebbels breached their fiduciary duties by manipulating financial records to misrepresent the city's true financial condition to then-Mayor Jim Robert-son and the Board of Aldermen. Leichliter later filed a counterclaim. Both the suit and counterclaim are pending.

Fagan said at the town-hall meeting, "I hope everybody here tonight considers when you vote on April 5th for the bond issue how you want the city to be beginning April 6th because you know what, as they say, tomorrow's the first day of the rest of your life, and it's really up to you guys how you want the city. We vote on issues — or I don't any more since I'm no longer an alderman unless there's a tie — but the eight aldermen, they vote on issues and they decide how we're going to do certain things and what choices we have to make in the short term. But really with this, it's up to you guys and if you do not want the same level of services, that's entirely within your prerogative and we'll have to make some changes. And we'll make some changes. If you're happy with the services, if you're happy with the bang for your buck, then hopefully you'll vote for it.''

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