In response to the letter to the editor from Mayor Bowing, let me first compliment the mayor for his desire to inform the public about issues and potential expenditures facing the City of Danville. Certainly it is commendable to make good information available to those paying the bill.
It is equally important to provide complete and accurate information. Mayor Bowling mentioned many potential expenditures facing the city in the future. What he failed to mention is how those expenditures must be paid off. The city operates water and sewer utilities. These are proprietary funds. This means simply that the expenses for the operation of these utilities must be paid from the operating revenues from these utilities. If we must build a water treatment plant, the cost of this capital improvement must be paid for in the rate structures for water services. If we must add significant additional sewer service in an amount that would be classified as a capital project, the cost of this capital improvement must be paid for in the rate structures for sewer services. It is likely that bonds would be issued to undertake projects of this magnitude. The debt service on such bonds would have to be paid out of revenues from these services. These kinds of utility projects are not paid from general fund revenues.