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1963-07-05 - Village Board Regular Meeting - Minutes MINUTES OF THE ADJOURNED REGULAR BOARD MEETING OF JULY 5, 1963, HELD MONDAY JULY 15, 1963 OF THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF BUFFALO GROVE, COOK COUNTY, ILLINOIS, AT THE LOUISA MAY ALCOTT PUBLIC SCHOOL IN BUFFALO GROVE, ILLINOIS . The meeting was called to order by the President. The Clerk called the roll and the following were found present : President Farrington; Trustees Rueckel, Racette, Marsh, Weiskopf, Huxhold, Frank President Farrington stated the approval of the minutes of the July 5th meeting would be dispensed with as this meeting is an adjournment of the July 5th meeting, specifically called to ask a number of questions concerning the Glen Grove development - more specifically questions that concern the utilities that will service Glen Grove because of a brief but stirring letter making the announcement that there would be a market for the bonds that would enable the Village or in part Lake County to provide water and sewer facilities. Contacts were made so that representatives from the Glen Grove Company could be present to answer questions insofar as they could from. the trustees or anyone else in the audience . President Farrington then gave a brief summary of what has evolved thus far and stated the only question to be resolved is how Glen Grove is going to be serviced by water and sewer. Trustee Marsh then requested President Farrington to re-read the letter from the Glen Grove Company dated July 1, 1963 (Doc. #185) . President Farrington did so and subsequently introduced Mr . Smith and asked him to explain his connection with the Glen Grove Company. Mr . Smith stated that at the present time the Glen Grove Company is owned by Smith and Pippenhagen. They contract to purchase land which they later sell to builders . At present Gilbert and Wolfe are the builders - - 2 others are interested but nothing can be definite until the sewer and water improvements are resolved. He stated considerable study has been given to the sewer and water facilities and their clients have always insisted that the property be within corporate limits and further that the municipality control the water and sewer because it is influential in the final sale of homes . There has always been considerable controversy concerning private water rates in comparison to municipal water rates . Trustee Rueckel asked whether it was the clients' opinion that if it does become a municipally owned utility, rates should be lower than existing rates. Mr . Smith stated they are usually 1/2 of what private utility rates are . Some towns have higher rates, reason being they had to purchase the private utility and consequently revenue bonds had to be provided and the amount tacked on to the water rates, but these will eventually be lowered. Trustee Marsh asked whether a study has been made as to the Village as it now is and as it will be with Glen Grove annexed for a possible site and the availability of water and whether they have some indication of how costly it will be to obtain water. Mr . Smith stated they have not gone into the exact engineering of the area but a study will be made with their engineers and the Village Engineer . It will take time before a cost can be found. Trustee Weiskopf asked whether there is a guarantee that bonds will be bought and at what rate of interest or in what manner it will be done . Will it be the entire amount or only what is needed at the time . Mr. Smith stated that the utility would probably be installed in sections, but bonds would be for the entire issue . The Chair then recognized Mr .Aribert Wild who stated in the event the Village is prepared to install water and sewer facilities, he would be prepared to purchase all bonds that will be issued to defray expenses . The issues will have to comply with pro- visions of the law, be, not more than 20 years, be approved by Chapman and Cutler and at the interest rate then prevailing. He stated he has a number of clients who are interested in investing money because dividends and interest are tax free . Trustee Marsh then asked whether Glen Grove would insist that only it be serviced or would it become a completely owned and controlled water and sewer works servicing everyone and whether it will be large enough to service the entire Village (present plus Glen Grove) . Mr . Smith stated that if it is a municipal facility, they do not believe they have the right to dictate to the trustees or water department . The size would have to be determined and finalized with the Village and Glen Grove Company Engineers. Trustee Racette asked whether sewer and water would be municipally owned or whether Lake County would own the sewage treatment plant. Mr . Smith stated he understands it is under study, since there are problems with sewerage disposal which the municipality may decide they prefer to have the Lake County Public Works Department handle . Mr . Wild stated he has a selfish interest and a direct contact with the Lake County Public Words administration and he would per- sonally favor that the entire sewerage treatment be absorbed by Lake County and the water plant operated and managed by the Village to give the people the water at the cheapest rates possible . He would be prepared to purchase bonds of the County to help defray expenses of installing a County sewer system. Trustee ?rank then stated for the benefit of anyone who did not know, he owns 19% of the stock of Buffalo Utility Company. It was organized in 1956 prior to the time there was a Village, house, or a resident in the new community of Buffalo Grove . It was organized because it was the only way to give water and sewer facilities to where the builders proposed the subdivision. He stated he also 53 has a selfish interest in wanting to reserve and expand his 19%. He stated that interest will be defended at other times by other people more capable than himself. Tonight as a duly elected member of the board, elected by people that knew of his 19% interest in the Utility, he wants to make sure the Village Board does not enter into anything without fully investigating it. He is not here to protect his interest in Buffalo Utility but to protect the people living in the village. He asked Mr . Smith if Mr . Pippenhagen was at one time associated with Herzog. Mr . Smith stated he was for a short time - their partnership was formed over a year ago. Questioned as to what areas he has developed, Mr. Smith stated Park Ridge Manor, DesPlaines Villas and has land now being built on by reputable Construction firms. It was then stated that Mr . Jack Siegel is the attorney representing the Glen Grove Company. Trustee Frank stated it is germaine to find out if the Glen Grove Company has a substantial interest financially in the land - whether there has been a down payment or deposit on any land purchase . Mr . Smith stated a deposit has been made and more will be added as soon as engineering problems are settled. Questioned as to the target date, Mr . Smith stated they have set the Spring of 1964 but would like to get things resolved as soon as possible . Questions were then asked concerning the estimated cost. A "top of the hat" figure of 14 million dollars was estimated for the sewer and water plants . Trustee Frank asked whether a study had been made on basis of a 20 year bond issue at prevailing interest rates, cost of operating, etc. , on what the water rates would be to retire the bond issues . Engineer Hooper stated the Plan Commission had come up with approximately 66 per 1, 000 gallons but this was merely a speculative figure . Trustee Marsh asked whether at this time tNre is enough information available to seek financial counsel. President Farrington stated the question was premature as no official actions in relation to the sewer and water as related to Buffalo Grove has been directed by the board. He stated until a more detailed study is made, there will be no official direc- tive by the board to determine whether the bond issue will be in its entirety or in part, what rate of interest will be, or what rates will be . The meeting this evening was to raise pertinent points which would alert everyone to what will have to be encountered. President Farrington then asked Mr. Raysa to explain the steps required to enter into a bond issue . Mr. Raysa stated an engineering survey must be set up, a bond revenue ordinance passed, a financial consultatn must be hired to set up maturity dates and finally everything given to Chapman and Cutler who will rule on the validity of the bond issue and determine whether the amount of revenue to be derived is sufficient to pay off the bonds. No firm will buy bonds without Chapman and Cutler approval. Trustee Marsh asked who Chapman and Cutler were . Mr . Raysa stated they are a law firm who specialize in examination and approval of municipal bonds. Trustee Frank stated that on the surface it seems that a munici- pally controlled water plant and possible county controlled sewerage plant is in the best interest of the new developers, but he is curious to know why nothing has been said as to what benefit it will be to the existing property owners of the Village. Trustee Marsh remarked it might be an incentive for the present utility to lower the rates. Mr . Smith stated that it has happened in � other municipalities where the existing water and sewer facilities were purchase . Trustee Weiskopf then stated that Buffalo Grove originally tried to negotiate terms with the present utility but could not because Mr . Frank sat on the board, as is now the case . Questions were asked as to what would happen to that part of Glen Grove in Cook County if Lake County controlled the sewerage . Pre- sident Farrington stated it was being checked out but it was felt there were statutes providing for that. He stated as to what benefits it will have on present residents - he can see no immediate gains. When funds are available from the utility to go into a general fund, they will be spent on the entire corporate limits not only Glen Grove. Trustee Frank then stated if we do get into this, we will have to retain a financial consultant and engineering and legal counsel. He asked who will pay these costs. President Farrington asked Mr . Raysa if it could be included in the bond issue. Mr. Raysa stated it could and that a financial consultant will work free of charge and get paid when the bonds are bought. Attorneys and Engineers require a nominal fee and if the bonds are purchased will request a regular fee . Trustee Frank questioned who would encounter costs if for some reason it did not go through.President Farrington stated the **** preliminary filing fee is paid to cover cost to the village in its work of investigating whether land should be annexed. President Farrington then asked Mr . Raysa whether we are legally entitled to sink another well in an area where an existing well is adequate . Mr . Raysa stated there was nothing illegal about it. Trustee Frank then asked what the next step is . President Farrington stated nothing has been completely resolved and answers must be gotten to such questions as by giving Lake County sewerage control would the Village be giving up partial control and be subjected to whims of Lake County? What is the function of the Public Works Department? Are they establishing a Sanitary district, similar to Cook County? Trustee Racette asked of a representative from Lake County Public Works could be present at the Thursday night meeting so more concrete answers could be given. Mr . Hooper stated he would have someone at the meeting. Mr . Wild then stated his appearance at the meeting was to be sure his client ' s interest were protected and is not ashamed to say that he will purchase the bonds not in the nature of charity but because bonds of this nature are very desirable since interest and **** Trustee Weiskopf, not President Farrington, made the statement �� dividends accumulated are not subject to taxes. He also stated his interest in having Lake County undertake sewerage is selfish because he could benefit from it as a property owner in surrounding areas, whereas if the municipality undertook it he might not benefit . Trustee Frank asked whether the attorney will be directed to begin a study and whether a financial consultant will be hired. president Farrington stated it will be deferred to Thursday night when more facts and figures are available . The review period under the Subdivision Regulation Ordinance has not yet begun since the utility question is not yet settled. Trustee Huxhold moved the meeting adjourn. Trustee Racette seconded the motion. Trustee Frank stated he wished to ask Mr . Wild whether he was ever refused service from Buffalo Utility. Mr . Wild said he was not because there was never a need to ask for such service . Roll was called and the motion to adjourn was carried unanimously. Respectfully submitted, villa QC rk Li