The Fulton City Council voted 8-0 Tuesday to table discussion on a proposed gas rate increase in the aftermath of February's extraordinary cold spell.
The move comes after the council in June rejected identical proposed increases of 5 cents for both the late August billing and the April 2022 billing.
The increases first appeared to pass by a narrow 4-3 margin. However, after an examination of the voting rules and procedures in the city's charter, it was discovered that five votes are required for passage, not a simple majority, so the motion failed.
Fulton - which at one point had a gas reserve account that totaled $5 million - budgeted $2.65 million for 2021 to cover wholesale natural gas expenses for the year. However, during the five-day cold snap in February, the city was forced to pay $3.4 million in expenses.
Fulton received some relief in early June when it learned it had been awarded a loan for $3.3 million through the Municipal Utility Loan Program established by the Missouri Department of Natural Resources' Division of Energy.
The program was created after Gov. Mike Parson signed legislation in May to provide $50 million for the five-year, interest-free emergency loans. Parson visited Fulton on June 30 to present city officials with the loan check.
The sticking point for the council Tuesday came in one particular term of agreement for the loan. The term, which was read out loud twice by City Director of Administration Bill Johnson, states that "the applicant will establish a dedicated source of revenue for repayment of the loan, either from rates, fees and charges for the use and services furnished by or through its related utility system, or if the applicant is a municipal utility commission. "
"This states that a dedicated source of revenue has to be established, not just a plan of repayment has to be established," said Ward 2 Councilman Jeff Stone, who has opposed a rate increase. "If we truly have to create a dedicated revenue stream that repays this loan, then that changes the flavor of our discussion.
"It gets us to where we're saying the 5 cents and the 5 cents (increases). It changes the reason why we have to do it, not just that we want to do it, but that we have to do it. We wouldn't really have a choice - there's not really going to be a choice or a discussion if that's truly how this is meant to read."
Stone then made the motion to table the discussion while the city seeks legal clarification from the state on the terms of the loan. The discussion will be taken up again at the council's next meeting July 27.
During Tuesday's 49-minute discussion, Ward 4 Councilman Bob Washington made a motion to propose a 3.5-cent increase in both September and again next April. Washington's motion was removed once it was decided to table the discussion, but it could be revisited at the July 27 meeting.
In other business Tuesday, council members heard the second and third readings then unanimously approved an ordinance that will amend Chapter 94, Article IV, in the city code on the storage, collection and disposal of solid waste.
The bill will repeal certain sections in regard to service charges and replace them with new ones.
The council then heard the second and third readings and gave their unanimous OK to an ordinance that will authorize amendments to the city budget for fiscal year 2020 as they relate to financial procedure and the transfer of appropriations.
Council members also recognized outgoing Parks and Recreation Board members Royce Anderson and Craig Snethen for their 25 and 16 years of service, respectively.
The council approved the appointment of Carl Brauner to the Historic Preservation Commission for a three-year term expiring in July 2024. Larry Doyle Jr. and Brenna Gough were approved to the Parks and Recreation Board for three-year terms expiring in July 2024.
Council members also approved a request from Lin Diekamp for the annual Callaway County CROP Hunger Walk at 1:30 p.m. Oct. 10.