VOTE SET ON WATER IMPROVEMENTS; CITY PUTS $26.5 MILLION BOND ISSUE, SALES TAX ON NOV. 5 BALLOT

Cape Girardeau voters will decide whether to issue $26.5 million in water system improvement bonds and pay for them with a quarter-cent sales tax.

At its meeting Monday, the Cape Girardeau City Council unanimously decided to put two separate issues -- whether to sell the bonds and how to pay the debt service -- on the Nov. 5 ballot.

If both pass, the bond money will be used to fund expansion of Water Plant 1, drill 21 wells near the plant and improve the city's water distribution system. A quarter-cent sales tax, expected to generate $1.75 million annually for 20 years, would retire the debt.

If the bond issue passes and the sales tax doesn't, water customers likely would see a 59 percent rate increase to pay the debt.

Councilmen first heard about the proposal at a spring retreat. They learned that Cape Girardeau's commercial expansion was outgrowing the city's water system. The current system is estimated to reach maximum use within the next two years, possibly causing a water shortage on a high-demand day.

The council initially was divided on the issue of how to stop that shortage. Some felt the ending price of the bonds, estimated to be about $46 million over 20 years, was too high for recommended system improvements.

Councilman Jack Rickard, once vehemently opposed to the plan, changed his mind and voted with the rest of the council Monday to put both issues on the ballot.

"I am still opposed to doing this with bonds, but I feel it is appropriate that the people of Cape Girardeau will get to vote on this separately," he said.

Councilman Richard Eggimann initially didn't like the fact that Burns & McDonnell, the engineering firm that proposed water system improvements, presented only one option. After being shown the higher expense of other plans, Eggimann said he was convinced and hoped city-contracted engineers presented alternative plans in the future.

All council members seemed pleased with an 11th-hour proposal that would save the city $12.5 million, making the final cost of bonds around $34 million instead of $46 million.

Under the recently passed Safe Drinking Water Act, a state revolving-loan program will be established to fund water system improvements that will make water quality better. For Cape Girardeau to qualify, voters would have to pass the bond issue. The loan money would be used to pay off the bonds, and the sales-tax or water rate increase wouldn't have to last as long.

Now that the council has decided the issue, city staff will undertake a public-information effort, including informational meetings, presentations and mailers.