The Hope City Board on Tuesday night took its first formal step toward placing an additional debt-service charge for sanitation for residential and commercial customers, voting to start a process designed to generate approximately $400,000 annually to finance long-deferred landfill and equipment improvements.

The meeting in its entirety can be seen at this link to the City of Hope’s Facebook page.  The working meeting considering cost-cutting changes to the Hope Aquatic and Recreational Center plans occurs first.  Then after a short break, the City Board member proper starts at the 1:05.17 mark in the video.

The action came after an extensive presentation by City Manager J.R. Wilson and Cheryl Schluterman, director of public finance with Raymond James, outlining a proposed $2.5 million borrowing package to address critical needs at the city’s landfill and sanitation department.

Wilson told the board the sanitation division has reached a point that continued delay is no longer responsible.

“As you all know, we've been talking with you for some time now about the needs of our landfill division of our sanitation department. We have a lot of work to do out there, and the immediate needs are looming upon us,” Wilson said.

He said that the department has operated for decades without a dedicated debt service structure. “The landfill, the sanitation department period has never had a debt service charge on it. It's always just been a rate,” Wilson said.

The borrowing plan would fund a replacement baling system estimated at approximately $1 million, a new excavator, skid steer, dump truck, construction of a new Class 4 landfill cell, structural repairs to the baler building, septic system corrections, underground drainage repairs, and related improvements.

Wilson described replacing the baler as particularly urgent.

“Our current baler is 30 years old, and we've been doing work on it for ten years at about $50,000 a pop, and it's just on its last leg. That's a million dollars of it right there,” he said.

He added that the Class 4 landfill cell, used for construction waste, is nearing capacity.

“It's probably about two years to its end of life. So we’ve got to start these things early, because it takes an [Arkansas] D[epartment] of E[nvironmental] Q[uality] approval and engineers involved. We got to start these things now to hit that target,” Wilson said.

Beyond equipment, Wilson warned that the sanitation department lacks adequate reserves to respond to emergencies or regulatory mandates.

“If we have an emergency today, we could not probably pay for it. We'd have to borrow the money somehow. We have to figure it out, because we don't have any reserves,” he said.

He further noted ongoing compliance concerns tied to a pre-1994 landfill cell.

“One of the items we have right now is we have one of our landfill cells that didn't have liners in them … and now we've got an ADEQ problem,” Wilson said.

The board was presented with financing options, including a public bond issuance and participation through the Rural Water Financing Agency. Schluterman explained the mechanics of both approaches and outlined projected annual debt service costs.

“We solved for achieving $2.5 million in project funds,” Schluterman said in describing the public issuance scenario she was tasked with analyzing for the City of Hope.

Under the Rural Water Financing Agency option, she said, “you would only have to borrow $2.4 million. … You do not have to borrow for a debt service reserve fund, which is one of the big benefits of this option.”

After discussion, Wilson indicated that a revenue increase of roughly $400,000 annually would be sufficient to support the debt.

“I think after talking with Cheryl, we're good somewhere close to that $400,000 number,” he said.

Mayor Don Still acknowledged his reluctance to raise rates but framed the increase as unavoidable.

“We hate to tax the residents of Hope anymore … but the sanitation department has been running on [older] equipment, and it should have probably been changed 10 years ago. We've been putting it back together every time,” Still said.

The board ultimately and unanimously approved a new monthly debt service charge structured as follows:

·       Residential customers will see a $7.10 increase per month.

·       Commercial “bag” customers will see a $10.30 increase per month.

·       Commercial dumpster customers will pay a flat $30.00 monthly debt service charge.

The motion was made by Director Gary Johnson, seconded, and passed by voice vote.

Wilson outlined the next procedural steps.

“We will end up having to do an ordinance adopting this rate. We'll be bringing that ordinance to you, to be reviewed by Randy,” he said, referring to City Attorney Randal Wright.  He added that if a public meeting was needed prior to the ordinance passage, that would certainly be held.

Wilson explained that implementation will depend on ordinance timing and coordination with Hope Water & Light billing cycles.

Once revenue begins flowing, the city can proceed to market the bonds.

The board also passed two resolutions required to secure Arkansas Natural Resources Commission funding for the landfill remediation including one resolution of intent and one granting signatory authority.  Hope has received a notice of intent to be awarded in the maximum aggregate principal amount of $521,830 from the ADEQ's revolving loan fund.

Earlier in the meeting, the board recognized State Representative Dolly Henley, who was presented a Distinguished Legislator Award by the Arkansas Municipal League. John Wilkerson, general counsel and legislative director for the League, praised her service.

“She was always kind to us. She was always supportive of us, and she's supportive of her cities and towns, not least of which, of course, being Hope,” Wilkerson said.

He added, “Representative Henley is certainly among the best in the state of Arkansas.” 

Henley responded briefly, saying, “I just would like to thank the Municipal League… what a great organization in the halls of the Capitol.”

Returning to infrastructure matters, the board approved the 2026 street overlay proposal presented by Kenneth Harvel. The plan includes $322,637 in overlay work, $44,000 for milling, approximately $20,000 tied to ice storm costs, and two pipe jobs totaling $28,000, leaving funds for miscellaneous gravel and pipe work.

“That'll be your marching orders for Kenneth to get started and get going,” Wilson told the board. 

Harvel indicated work could begin soon. “He was hoping he could get started about the middle of March,” he said of the contractor supplying the materials.

The board also approved two street cuts on 28th Street to allow Warner Mays to connect three lots to city sewer service.

Mays described future development plans.

“We’re just going to build… and then we’ve got a lot for a spec house,” he said.

The board approved the connection request by motion and vote and several members expressed enthusiasm about the looks of the houses Mays has built as well as the prospect of more available housing in the city.

Directors also formally adopted value engineering decisions tied to the Hope Aquatic and Recreation Center project, opting to save money on some options but to keep several others according to the specifications Hope residents made from the beginning of the effort to build the facility.   

Later in the meeting, the board considered a recommendation regarding third-party testing for the recreation center project. After discussion and roll call vote, the board selected ETTL Engineers & Consultants.

In his city manager report, Wilson updated directors on acquisition of the future fire department site and progress toward asbestos abatement and demolition.

Above photo:  Kenneth Harvel, City Street Superintendent presents plans for this year's street overlay projects.