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Regular Council Meeting January 25, 2021 Page 5 given the ranking, the size of the project, every change they made fatally impacted Garver's proposal. Mr. Path explained that City Staff worked very closely with representatives of Garver, SAMCO Capital (financial advisers), McCall, Parkhurst & Horton, LLP (bond counsel) and NewGen Strategies & Solutions, LLC (rate consultants) to carefully examine all possible options, which included phasing the WWTP, phasing CO options, possibly pursuing TWDB loans as part of future phases, and phasing in rate increases. Mr. Path said this was not an action item but if the City Council was agreeable with this plan proposed, City Staff would bring back to Council several action items at the February 8 City Council meeting. Mr. Path reviewed with City Council the options of Certificates of Obligation, a Garver Agreement Amendment, Debt Payments and Adjustment of Rates. Mr. Clement reviewed Phases 1 and 2 of the project, stating the process would take almost seven years to complete. Finance Director Gene Anderson reviewed the three rate options that had been developed. Mr. Anderson said Option #1 was a two rate increase, provided the most stability for the WWTP operations and pays back debt with Waste Water Utility revenues. He said Option 2 ,was a three rate increase, while not offering as much stability for the WWTP operations but did help soften the increases over time. Mr. Anderson said ,Option #3 was a semi=annual increase; provided the least stability of the three options for the WWTP operations, but was the :best route of phasing in the increases over time, allowing payers to acclimate over the course of six years. Mr. Path and Mr. Anderson answered questions from City Council and provided the dates and estimated amount of increasesfor the three options. Mr. Path said this was a large project that would require an increase while trying 3. to maintain a 1-1 coverage ratio between revenue and expenses, and not dip into the City's reserves. Council Member Portugal said she preferred option #3. Council Member Knox said she preferred the faster option but was, sure her constituents would appreciate option #3.. Mayor Clifford confirmed with Mr. Anderson that with option #3 they would end up with a higher rate at the end. Mr. Anderson said that was correct because with option #3, they would be delaying the principal. Council Member Savage said he was in agreement of option #3, which was phasing in the rates. Mr. Path said the hope was when the City got to Phase 2, that a loan would be available. Utilities Director Doug Harris explained how the wastewater works. It was a consensus of City Council to go with option #3 and that City Staff bring the documents to their next City Council meeting. 18. Discuss and possibly authorize the City Attorney to file suit for collection of the following debts to the City: • Brentwood Terrace Healthcare & Rehabilitation Center $ 7,008.00 • Heritage House of Paris $14,014.00 • Legend Healthcare & Rehabilitation $ 1,433.00 • Stillhouse Rehabilitation & Healthcare Center $ 9,310.00 Ms. Harris reported that over the past two or three years, four local nursing homes failed to pay EMS bills related to transports for which insurance and Medicare do not provide