Minutes - Council Work Session - 09/15/2003

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and were broken down by phases and infrastructure. The next set of boxes (42 through 50) is the estimated debt ratios and the last box shows the Enterprise Debt Service. Discussion ensued relating to the debt and what it will be when the fees are collected. Mr. Donna presented worst case scenario. Councilmember Zimmerman inquired if land is set aside for wells, to which Assistant Director of Public Works Olson responded that land is dedicated to the City or is available to the City. He described well connections, piping, etc., to hook up to the system. A treatment system was also discussed. Mr. Olson stated that the Charter School is committed to the first phase as is some residential building. Tim Engen added there are 900 units in the first phase. Mr. Olson presented the phasing plan, the sewer and water improvements, the storm sewer improvements, talked about the size of sewer pipes needed and the cost of same. He pointed out the ponds and talked about the connecting pipes and the fact that the storm sewer costs shot way up. The developer will install or put up sureties to make sure the storm sewer gets constructed. That reduced the amount the City was responsible for. Mr. Olson talked about boring under roads and doing the constructing so that we do not have to dig into streets again. The City asked the developer to change that to be their responsibility. Assistant Director of Public Works Olson summarized the red lines on the map showing the City's Phase I streets and utilities as well as Phase II streets and utilities. Total debt service is about $7.4 million. If the City had to borrow the entire amount and pay it back over a 10-year period; that would be the worst case scenario. City Administrator Norman pointed out that the City has more fees coming in than we have debt. Counci hnember Zimmerman inquired what if things cost more than proposed. Councilmember Elvig stated that the City is well protected from revenue shortfalls on two facets; we could pick it back up. Councihnember Strommen agreed that the City is well protected. Tim Engen reported that next week, the Charter School will write a check to the City for $57,000 and shortly thereafter, a check will be written for between $180,000 to $ I90,000 for residential. Mr. Norman stated that we are focusing on debt and we may not even have to bond. Councihnember Eivig referred to the development agreement. Section 8.4 says the City has the ability for special assessments if we experience a shortfall. Section 8.8 also protects the City by stating that we can raise fees if necessary. If hook ups are more than we anticipated, we can balance them. Mr. Olson added that we have generally increased fees 3% to 4% annually, and that has not been brought into this discussion. City Council Work Session/September 15, 2003 Page 4 of 10