Davenport adviser David Rose urges rate increases as Emporia weighs $20 million police station

David Rose of Davenport & Company told the Emporia City Council at its April 11 advance that the City must complete the FY2025 audit promptly and continue utility rate increases to preserve access to low-cost financing and reduce General Fund transfers to the Utility Fund. “If the audit is delayed until September, Davenport may recommend applying through VRA’s fall application cycle,” Rose said, noting later financing cycles could be more costly.

Rose reviewed the City’s fiscal position, saying the annual audit process had fallen behind but that the FY2024 audit was completed in late March 2026. He said Emporia’s unassigned General Fund balance remains strong at about 57.5 percent — above the City’s policy goal of 35 percent — and recommended a balanced approach that uses some cash for specific capital needs while preserving reserves.

Council members pressed on the timing and scope of upcoming projects. Rose outlined a path to permanently finance two interim utility loans, including a planned $9.5 million permanent financing for the rate plan, and described a five‑year utility rate plan intended to make the enterprise self-supporting. He said that without timely audits and continued rate adjustments, the City could face higher borrowing costs or more General Fund transfers to cover utility needs.

The presentation included planning estimates for several capital projects. Rose used a $20 million planning figure for a proposed police station and said potential additional revenues — including gaming-tax receipts from Rosie’s and future economic development — could help support debt service but would need to materialize. He said courthouse improvements are estimated at roughly $9 million, with Emporia’s share expected to be about one-third, and recommended cash-funding some smaller projects such as City Hall and library roof repairs (City net estimate $1.3 million).

City Manager William E. Johnson III and Council members discussed procurement and next steps. Johnson said the City received a reduced quote from Richard Short to cut remaining trees on the Save‑A‑Lot property and asked whether Council wished to authorize him to proceed toward a contract; Council indicated direction was sought but no formal vote was recorded. Councilman James C. Saunders and Councilman Mark Lilly reiterated caution about over‑reliance on fund balance and asked staff to continue seeking cost savings and design reviews for large projects, including a closer look at the police station’s design and per‑square‑foot estimate.

Rose recommended including a small solar project in a larger financing package rather than financing it separately to reduce costs. He also noted that permanent financing for the interim utility loans is contingent on the FY2025 audit delivery and certain state funding program deadlines.

Next steps identified during the advance included staff coordination with lenders and state programs, possible use of some cash for targeted projects, continued rate adjustments for the Utility Fund, and seeking timely draft audit deliverables from the auditor to meet financing windows. The City Clerk will circulate scheduling items to Council for upcoming budget work sessions.