Cass County Council on Aging’s proposed senior center could “anchor” downtown Dowagiac. City Council will weight two $30,000 offers in August.

By JOHN EBY

Dowagiac Daily News

Expanding opportunities for senior citizens is behind Cass County Council on Aging’s $30,000 cash at closing offer for storefronts at 225 S. Front St.

According to a July 20 letter from COA President Eleanore Flowers and Executive Director Bob Cochrane, the Cassopolis-based agency has for several months been reviewing a number of options available to enhance its programming level on the western side of the county.

On July 13, the COA board of directors met and authorized the offer to buy the buildings owned by the City of Dowagiac adjacent to City Hall.

“Our intent is to completely remodel both the interior and exterior of the facilities to support Council on Aging programs including fitness, congregate dining, social programming and adult education,” the letter states.

The sale, which also must lie on the table for 21 days, is contingent on the purchaser securing a Phase I environmental report and a roof assessment.

June 28 Theresa Savidge made a $30,000 pitch to Dowagiac City Council she hoped to turn into three businesses employing 10 to 15 people.

Savidge “has a number of business interests she’d like to pursue,” City Manager Kevin Anderson reported. “She offered $30,000 in cash for the property as is and would make that payable at $500 per month.”

City charter requires 21 days so there is a period of time in case other interested parties wish to counter offers in the interest of making real estate dealings transparent.

As a significant capital investment, the COA senior center could be a long-term “anchor,” City Manager Kevin Anderson said. “It’s a strong offer that probably should take priority.”

Mayor Pro Tem Leon Laylin said the council should “keep both options open” since a decision will not be due now until August.

The other Third Ward councilman, Dr. Charles Burling, agreed, saying an attractive part of the COA offer is the cash component versus being a “bank” for a six-year payback.

“This is not to say Ms. Savidge’s offer was not a quality offer,” Anderson added. “It is my hope that city staff will be able to work with her to establish another location in the downtown for the businesses she plans to establish.”

One storefront has been the Michigan Employment Security Commission (MESC) office, a dollar store and, most recently, a pet store.

The other, once a grocery store and Kentucky Fried Chicken, most recently housed Daylight Doughnuts.

There is a third location in back, near Depot Drive, which has been pizzerias, a meat market and an art gallery. Savidge had that in mind for a sports training and nutritional outlet.

She proposed a gift shop for the pet store and a sandwich and coffee shop for the doughnut place that would serve lunch and breakfast and offer Hungarian dishes and pastry.

The COA offered programming in Dowagiac at Lincoln Community Center before it became Encore School for the Arts.

In other business, the council granted approval for Dowagiac District Library to make improvements of excavating retaining walls on the New York Avenue side of the Carnegie building.

Once excavation is complete, the DDL will be able to better identify the source of sewer gas leaks experienced last winter.

The DDL will expose the original foundation, landscape the area, including a rain garden for roof drainage, and install two benches for public seating.

Anderson said the library’s lease of the 106-year-old, city-owned building requires council approval.

The library also asked for Department of Public Services (DPS) crews to provide labor and equipment expected to cost no more than $2,500, though the two staffs will determine an adequate figure.

Council approved a water operator agreement for Dowagiac to maintain Penn Township’s system, which with stimulus funds will be expanded to include Diamond Lake and Donnell Lake.

Financing has been approved and the project will be under construction soon.

“They will expand their customer base by a significant amount,” Anderson said. “With this system expansion there is room for us to be able to operate the system in a manner that is beneficial to both parties.”

The five-year agreement drafted by City Attorney Mark Westrate’s office and reviewed by the city’s insurance carrier, the grant and financing agency and the Cass County Board of Public Works will be effective June 16, 2011. It will renew automatically unless either party gives notice.

Initial rates have been established and will be reviewed annually on July 1.

If mutually agreeable rates are not established, binding arbitration will occur. Initially, 91 percent of billings will be retained by the city. The balance goes to the county for a capital improvement fund. Once customer count reaches 235, the city retains 85 percent of billings.

BPW shall be responsible for all capital improvements as defined in the agreement. The city is responsible to maintain the water system in compliance with all state and federal regulations.

The agreement calls for the city to provide a series of monthly, quarterly and annual reports to the county in impacted townships.

Dowagiac will not be responsible for either routine main flushing or valve exercising until 275 customers connect to the system.

The city shall bill system customers $20.55 per month for the first 4,000 gallons with a usage rate of $4.83 per 1,000 gallons thereafter.

Anderson said Kevin Cox is the only properly licensed individual currently, but that others are in the process of completing qualifications.

Council gave first reading to Dowagiac water/sewer rate ordinance amendments that will cost an average customer $7 a month.

Anderson said it has been two years since the city last reviewed water and sewer rates.

Since then, there have been “a number of factors that impact rates, including a decline in consumption as well as some increases in cost for labor utilities and supplies. Since much of the cost of operating water and sewer systems are fixed costs, both factors act to increase the rate necessary to provide these vital services.”

City customers are responsible for a portion of the cost to operate the wastewater treatment plant based on cost-sharing formulas in agreements with the Village of Cassopolis and the Indian Lake and Sister Lakes Sewer Authorities.

The city is also responsible for the cost of maintaining lift stations within Dowagiac.

Based on projected costs, use and consumption, the utility needs to generate about $3.50 per resident equivalent unit per month to provide sewer service to city residents.

Larger meters within the system pay a proportionately largerer cost.

In total, the sewer rate increase should generate about $104,000 in new revenue.

For at least a decade, revenues derived from leases for cell towers subsidized community water rates.

These cell tower leases amount to about $50,000 per year, or $2.50 per typical household customer.

The 2010-11 budget taking effect Oct. 1 calls for the subsidy to end and all money from cell tower leases to be redirected to the capital projects fund so road improvements can be made throughout the city.

Additionally, in the two years since the last rate boost, water use dropped.

Since most of the cost of the water utility is fixed, rates need adjustment to maintain current operations. In total, rate increases for the water utility will be $97,000 per year. Typical residential household use can expect to translate into about a $3.50 per month average increase in water cost.

“There are no plans for increases to electric rates this year,” Anderson stated.

A typical combined water, sewer and electric bill for a residential customer currently runs $115 to $125 per month, he said.

Rates the council would approve Aug. 9 would take effect with September bills.