Minutes - Council - 11/07/1994 - Laserfiche WebLink

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reason, Staff recommends approval of the request contingent upon AMU making annual payments to the City in lieu of taxes. Councilmember Hardin inquired about overhead line versus underground line. Dan Voss, Anoka Municipal Utilities (AMU) stated that underground lines cost four and five times more than overhead lines. There have not been utility lines underground with such a high voltage; they are hard to get to if a problem is encountered. To mitigate the problem of getting to the line, you basically build two lines and that really escalates the cost. Underground line is basically cost prohibitive. Councilmember Hardin inquired how the value will be formulated. Mr. Voss replied that the State takes the hardware value, we give them the work order saying how much it is, that's the fa'st years value. There is a 2.5 percent depreciation over 10 years, then it's at a fixed value (down to 75 percent of the value at the end of 10 years). Councilmember Hardin inquired if that's a factor in the future value of hook-ups to the line to which Mr. Voss stated no. Mayor Oilbertson inquired if labor is included to which Mr. Voss stated they show the State everything. The depreciation is 2.5 percent of the materials and maybe a portion of the labor. Mr. Voss stated he was not sure of that but reiterated that they would give the State all the information they needed and they would calculate the amount. Councilmember Peterson asked to see a picture of the pole AMU is planning to put up, which Mr. Voss presented. Councilmember Zimmerman stated that the City is trying to update some of the businesses on Highway #10 N.W. and inquired what would be the problem with steel towers instead of wooden posts. Mr. Voss stated that the only problem would be cost. He felt that you don't really save anything with regard to viewer aesthetics. Councilmember Zimmerman stated he would like to see steel posts on Highway #10. Councilmernber Peterson stated he too would like to see steel posts on Highway #10. Councilmember Hardin inquired of the estimated cost to which Mr. Voss replied about $150,000 a mile, so it would total about $400,000 to $450,000. Mr. Schroeder inquired if the easement value is figured. Mr. Voss thought that it was. Councilmember Hardin inquired if the easement is figured into the State formula also to which Mr. Voss replied no. Mayor Gilbertson inquired about the permitting cost. Mr. Schroeder stated that the permit is to allow the City to recover what AMU would have to pay if they were a tax paying entity. Finance Officer Hart stated that when the State certifies a value, the City will place a tax value on that. City Council/November 7, 1994 Page 4 of 13