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Motion by Councilmember Hardin and seconded by Mayor Gilbertson to accept the 1993 Comprehensive Annual Financial Report and authorize the Finance Officer to submit it to the State of Minnesota Department of Revenue and other agencies as required. Motion carried. Voting Yes: Mayor Gilbertson, Councilmembers Hardin, Beyer, Peterson and Zimmerman. Voting No: None. Case 02: Authorize finalizing Contract with Anoka Electric Cooperative (AEC) for Utility Billing Services Finance Officer Hart stated that on February 22, 1994, the City Council authorized entering into an agreement with Anoka Electric Cooperative (AEC) to perform the functions of meter reading, utility billing and collections for the City. The agreement has been reviewed by City Attorney Bill Goodrich and also an attorney for AEC. The agreement meets all requirements and covers all bases. Motion by Mayor Gilbertson and seconded by Councilmember Hardin to recommend that City Council authorize the City Administrator to sign the attached agreement with AEC for utility billing services as outlined in the contract. Motion carried. Voting Yes: Mayor Gilbertson, Councilmembers Hardin and Peterson. Voting No: Councilmembers Beyer and Zimmerman. Case #3: Discuss Potential Funding Source for Priority Arterial Street Lights - Installation and Operation and Maintenance Costs Finance Officer Hart stated that the Road and Bridge Committee received information regarding cost information to have all or most of the priority street lights installed. The cost estimates were provided by Anoka Electric Cooperative (AEC) and met all of the specifications included in the City's street lighting policy. The Road and Bridge Committee forwarded this information to the Finance Committee to review and discuss potential funding sources for installation costs and the ongoing operation and maintenance costs of the various levels. Ms. Hah explained that the City currently has 25 priority arterial street lights, for which the operation and maintenance costs of $2,250 are funded through the General Fund. If all 132 priority arterial street lights were installed and the operation and maintenance costs were paid from the General Fund, there would be an increase from the current $2,250 per year to approximately $11,880 per year. If the capital recovery costs of $16,914 is included, the increase to the General Fund budget would be $31,044 annually. She stated that the General Fund could "borrow" monies from another fund, such as the Water Fund, however, it would be necessary to fund the loan repayment and the annual operating costs of the additional street lights. Ms. Hart explained that approximately seven of the 132 lights would benefit commercial properties and to levy would be unfair as it would be penalizing them. One funding avenue would be to bill all the benefitted parties; however, that would be a costly route to go. She stated that the alternative of billing all residential properties through the billing system at AEC has been discussed. However, to add this line item to approximately 4,500 accounts would cost the City a one-time charge of $5,625, plus a quarterly billing charge of approximately $1,350. (This assumes that all of the 4,500 households are currently serviced by AEC. The cost would go up if any of the affected properties are non-members of AEC). Councilmember Hardin felt this would be the ideal way to bill for street lights; however, he suggested adding this into the Utility Billing Services contract with AEC and that maybe AEC would waive the subscription fee of $5,625. Councilmember Beyer inquired why not levy for street lights. Ms. Hart explained that a levy would be unfair to the commercial customers because it is based on the property value. Finance Committee/June 28, 1994 Page 2 of 4