Citing Bettendorf's high debt burden, Moody's Investor Service Thursday (3/27) downgraded the city's bond rating from Aa1 to Aa2. The lower rating is expected to result in higher interest on the more than $20 million in general obligation bonds slated to be issued next month.

The agency in its rating rationale said the city was in a "sound financial position supported by prudent fiscal management and flexibility to adjust tax levels," but added the lower rating "reflects challenges tied to the city's elevated debt burden, high fixed cost ratio and moderate exposure to two underfunded cost-sharing retirement systems."

Moody's also said the city could move its rating back up with "moderation of the city's high direct debt burden," which will reach $133 million after completion of this spring's general obligation bond issuance. The city's debt will reach 86 percent of the maximum debt allowed by the state after the new bonds are issued.

Grain Processing Corporation (GPC) has agreed to a record $1.5 million fine and ordered to hire an independent firm to conduct a comprehensive environmental audit of its Muscatine corn-processing facility to assure compliance with federal and state environmental laws.

The consent decree approved Thursday (3/27) by a Muscatine County judge resolves a lawsuit filed by the Iowa Attorney General in December 2011, and addresses air and water pollution violations cited by the Iowa Department of Natural Resources (IDNR) as far back as 2009.

The Muscatine firm, owned by Kent Corporation, announced a $100-million capital improvement program for the GPC plant after the lawsuit was filed, and in its news release Thursday promised the plant upgrades will reduce air emissions "well below the newest and more stringent air quality standards now set by the EPA."

The company also said when its new corn-drying facility is complete, "smoke, odor, and haze will be nearly eliminated" at the facility.

Muscatine has been designated as in "non-attainment" for fine particulate (PM 2.5) pollution by the U.S. Environmental Protection Agency (EPA). In 2013, of the 14 exceedances of air quality standards for PM 2.5 statewide, seven were recorded in Muscatine. For the same period, all 67 exceedances of air quality standards for sulfur dioxide (SO2) statewide were recorded in Muscatine.

If you suffer from asthma or other breathing problems aggravated by ground-level ozone pollution, you may be surprised to learn Quad Cities area mayors and the region's planning agency have sided with business and industry groups to urge the U.S. Environmental Protection Agency (EPA) back off its plan to set tougher ozone pollution standards.

Without public notice, public hearings or a public vote, the mayors of Bettendorf, Davenport, Rock Island, Moline, East Moline and Muscatine along with the Scott and Rock Island County Board chairmen signed a letter from the Bi-State Regional Commission to EPA opposing the lower emission standard for ozone stating the change "would impose new and more costly standards on local businesses at a time of recession and historic unemployment nationwide."

The letter sent March 14 argues that "only areas without (air) monitors, smaller urban and rural areas, would be able to attract businesses and industries. This outflow of industry from large and midsize urban areas would be counter to smart growth and sustainability implementation strategies."

The EPA has been sitting on tougher ambient air quality standards for ozone emissions since 2008 and is finally moving ahead with the process that would lower the standard from 0.075 parts per million (ppm) to a level between 0.060 to 0.070 ppm. The 8-hour "primary" ozone standard is designed to protect public health and is based on "human clinical studies showing effects in healthy adults at 0.060 ppm, and results of EPA's exposure and risk assessment."

A billboard company is seeking a "hardship" variance to increase the height of its 10-foot by 40-foot sign at one of the busiest intersections in Bettendorf.

Lamar Advertising wants a variance from the Bettendorf Board of Adjustment so it can increase the height of its giant billboard at Middle and Devils Glen Roads to 40 feet in height from its current 30 feet.

The reason for the hardship – another sign at the corner is blocking motorist from fully seeing the billboard as they drive east on Middle Road.

The sign "obstructing" the Lamar billboard is actually the on-premise sign for the corner oil change shop. Lamar erected its billboard essentially on top of the oil change building years ago, after apparently reaching a deal with the corner property owner.

Bettendorf will know next week whether the city's bond rating will be downgraded by Moody's Investor Service, a move that would boost interest rates on more than $20 million of general obligation bonds scheduled for sale April 1.

City Administrator Decker Ploehn told the city council he and City Finance Director Carol Barnes are scheduled to have a conference call Tues., March 18 with Moody's representatives and the city's bond counsel, Springsted, Inc. He conceded that the city's large amount of debt scheduled to be issued next month might push the rating higher along with the interest rate on the debt to be issued.

Despite promises of lowering the debt to 70 percent of the city's debt limit two years ago, the new bonds to be issued this spring would push the city's debt limit to 86 percent, the highest of any municipality in the state.

Ploehn pointed out the city's large debt issue this spring is actually to cover two years of debt financing of capital projects, a move estimated to save the city $300,000 in bond issuance expenses. Interest payments on the $20.17 million 30-year bond issue would total nearly $8 million.

After the bond issue next month, the city will have outstanding debt of $133 million, or about $4,000 for every resident of the city. The city administrator says the high debt level is needed to meet the capital improvement demands of a growing community.

Owners of The Lodge Hotel would receive up to $3.1 million in property tax and hotel sales tax rebates under a development agreement being considered by the Bettendorf City Council.

The proposed agreement with Spruce Hills Investment Partners, LLC would provide $1.75 million in Tax Increment Financing (TIF) rebates over a 10-year period and another $1 million in hotel sales tax rebates over a 5-year period. If the developers complete a 6,000 square foot retail/office center on the hotel property prior to Dec. 31, 2024, they also would get an additional two years of the TIF rebates, or $350,000.

The Lodge, formerly Jumer's Castle Lodge, has been a Bettendorf fixture at the I-74 and Spruce Hills Drive location since it opened in 1973. Peoria businessman James Jumer built three German-themed lodges, two in Illinois and the one in Bettendorf. All had Bavarian decor, authentic antique furnishings and German food specialties on the hotel restaurant menus.

The growing disparity between those who have and those who have-not, and the injury poverty inflicts upon the poor, here in the United States and around the world, has received growing attention in recent months.

A “Century Marks” report by Oxfam (The Oxford Committee for Famine Relief) noted in its January issue that the 85 richest people in the world have as much wealth as the poorest half of the world’s population, or 3.5 billion people.

Oxfam’s executive director observed in the report that “this tiny elite … could all fit comfortably on a double-decker bus.”

The Oxfam report concluded that “world poverty cannot be tackled without addressing wealth inequality and the political power that often accompanies it.”

Bettendorf's bond consel has raised the possibility of a downgrade in the city's bond rating by Moody's Investor Service, a move that would mean higher interest rates on $20.17 million in general obligation bonds slated for approval by aldermen at Tuesday's (3/4) city council meeting.

"in January of this year, Moody's Investor Service released its new methodology on U.S. Government General Obligation Debt," Springsted, Inc., Bettendorf's long-standing advisor on bond issues, stated in its list of "risks and special considerations" prepared for the city. "Along with this release, Moody's provided a list of local government general obligation rates that they currently have under review for upgrade or downgrade. The City of Bettendorf was on the list as a potential downgrade."

Moody's assigned an Aa1 rating to the city's $14.4 million general obligation bonds issued last spring.

"If such a downgrade does transpire, this could result in higher interest rates than what we have currently projected in the attached bond schedules," Springsted wrote in the letter to the city. "Higher interest rates will impact the projected savings on the refunding transaction and potentially require adjustments to the principal amounts of the new money financing to meet the city's levy constraints."

Thanks to a $12-million tax benefit from the recent sale of its Davenport Rhythm City Casino, the Isle of Capri Casinos, Inc. today (2/27) reported net income of $10.66 million for the third quarter ended January 26, compared with a $2.2 million loss for the same period a year ago.

The one-time tax benefit resulted in earnings of 24 cents per share for the quarter, compared with a 6 cent per share loss a year ago.

"Income from continuing operations for the quarter ended January 26, 2014 was impacted by the reversal of a $2 million litigation accrual due to a recent favorable court ruling, and the $12 million reversal of a previously recorded tax valuation allowance, as a result of the recent sale of our Davenport property," Isle President and CEO Virginia McDowell said in the company news release.

Bettendorf plans to issue more than million of general obligation bonds this spring that would boost the city's debt to more than $133 million, or nearly 86 percent of its legal debt limit. The city's debt would be the highest in the state of Iowa as a percentage of the legal limit at 85.52 percent.

However, City Administrator Decker Ploehn voiced his confidence to the city council about the plan to issue millions in new general and corporate bonds, telling aldermen the city has ample capacity to raise property taxes should it need additional funds for unexpected future projects or expenses.

Bettendorf is one of just a few Iowa cities with a general fund property tax levy well below the maximum allowed $8.10 per $1,000 assessed valuation, according to Ploehn. The city's general fund levy currently is $5.44 per $1,000 assessed valuation. "This allows for future growth capacity of 48 percent, equating to nearly $5 million of potential property taxes," Ploehn stated in the budget presentation he made earlier this month.

According to statistics compiled by the city, even though Bettendorf ranks high in total debt and the debt service tax levy, Bettendorf is the third lowest when combining property taxes, storm water fees, sewer charges and solid waste disposal fees for an average homeowner (median home value of $165,260) among 30 Iowa communities of 10,000 people or more.

He also points to the city's Aa1 bond rating in support of the decision to add debt, rather than raise property taxes, to pay for new capital projects.

While investors may feel secure in buying the city's bonds (debt), city taxpayers end up paying more for every new street and municipal improvement since interest costs on the bonds add to the total price of those improvements.