Shawnee changes charter ordinance to allow debt financing for purchase of streetlights

Shawnee had to approve a change to its charter ordinance to allow for the issuance of bonds to purchase streetlights from the power utility.

Shawnee leaders have agreed to add a provision to the city’s charter ordinances that will allow the city to borrow money to purchase the city’s streetlights.

The charter ordinance change permits the city to debt finance the acquisition of streetlights from Every Metro Inc. (formerly KCP&L) through the issuance of general obligation bonds.

City Attorney Ellis Rainey said he was concerned there was some misinformation about the charter ordinance change, so he wanted to provide clarification: By itself, it does not authorize issuance of any bonds or authorize any projects.

“I want to be clear that any future projects or bond issues will have to be approved by the governing body,” Rainey told the council on Oct. 14. “You’ll still go through the same process you guys have always gone through for the issuance of general improvement bonds or general obligation bonds.”

Rainey added that the proposed charter ordinance would not change any bond limits for the city either because the bond limits were eliminated by charter ordinance in 2005.

“We still go through the same project process, we still go through the same general obligation bond process,” Rainey said. “There’s no hidden agenda here. There’s no intent to concede any type of authority mechanism that does not already exist. It’s a simple fact that when we reviewed charter ordinance 43, we discovered that the ordinance authority does not authorize the issuance of general obligation bonds to pay for streetlights.”

Mayor Michelle Distler said the city’s charter ordinances had authorized the city to issue general obligation bonds to pay for streetlights in 1955, but that authority was taken out in 1987.

Rainey said authorization to pay for streetlights was in the state statute but not in the original city ordinance. He added that this has happened in the past, when city leaders would issue general obligation bonds for public improvements that weren’t yet included in the city’s charter ordinances.

Rainey and the city’s bond counsel Kutak Rock had also proposed a change to the charter ordinance that included a generic definition of “public improvement.” This would have allowed the city to debt finance any public improvements, including unforeseen improvements that may not exist in the present day but would exist in the future.

Councilmember Stephanie Meyer asked if the city needed the broad language of public improvements at this time, or if the city could narrow the scope of it to simply allow the issuance of general obligation bonds to acquire streetlights.

Councilmember Eric Jenkins agreed with Meyer, adding that he would accept a change to the charter ordinance allowing the city to issue general obligations to purchase the streetlights. However, he wanted to keep the item limited to what the city needs now: The streetlights.

Rainey said he had concerns about the city returning every few years to make changes to the charter ordinance as the need for new types of public improvements crop up in the future.

Before the governing body took any votes on the item, Shawnee resident Ray Erlichman said he wished the city had provided more notice before making the charter ordinance change.

Another resident said she wanted the city to focus on sidewalks and other infrastructure in Shawnee Village, as opposed to streetlights. Distler said the acquisition of streetlights will save money in the future and free up city dollars to cover other public infrastructure improvements.

The Shawnee governing body on Oct. 14 unanimously approved the charter ordinance change. The city council also voted 7-0 to approve an agreement to purchase the streetlight system from Evergy Metro, Inc. for $3,250,000.

Councilmember Matt Zimmerman was absent.