Minutes - Council - 10/20/1986 - Public Hearing

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$7,062.88 per acre for sewer and water. Amortized over ten years at 9%, the cost for sewer and water per commercial acre would be $1,100.40/year. The lateral benefit for sewer is calculated on a front foot basis; the cost to a 200' front lot, amortized over ten years at 9%, would be $934.80/year. Project schedule includes ordering plans and specs in December, awarding contract in January, construction beginning in March and ending in August and assessment hearings in September. Mr. Hartley referred to the extra funds that would be generated by water trunk assessments and stated that staff is in the process of reviewing the possibility of using those funds for a water tower and well~ Adding in those costs, the total project is estimated at $2,800,000.00. Oust as in the previously proposed project, the City is willing to apply $1,700,000.00 towards the project to help keep assessments down. The project, as previously proposed, was stopped because the bids received exceeded the engineer's estimate by more than 10%. Redesigning and seeking new bids in the off-construction season should result in more competitive bidding on the new project. Mr. Hartly stated that he is not trying to be a salesman for the project but he wants the affected property owners to understand that Ramsey has 1.7 million dollars targeted to benefit the property owners in this project; if this project is delayed to some time in the future, there is a very good chance that the 1.7 million will not be available and the cost to the property owners will be that much higher. Mr. Hartley stated that he understands that the property owners would like to retain the advantage of having the actual cost of the project written down but cannot afford the assessment at this time and are interested in deferments. Mr. Hartley stated that the problem with deferments is that the City would have to pay the interest on those payments; that amount compounds and eventaully comes due from the property owner. In order to encourage payment of the assessments within a ten year time frame, it might be possible for the City to offer a 25% discount for starting to pay assessments right away. Assessments can be deferred up to ten years but the compounded interest over that period of time will end up costing the property owners a lot more. Indexing of assessments is another possibility; property owners could pay assessments right away with a 25% discount and graduate that discount so that after 5 years into the assessment time frame, the property owner is paying 100% of the assessment indexed. Mr. Hartley stated that he needs to know from the property owners whether they are in favor or opposed to the project; and what is more important -- the actual cost reduction or deferred assessments or both. Mr. Hartley stated that with that information he can put together a package for Council review at a follow-up meeting. CITIZEN INPUT Steve Gorecki - 14140 Azurite Street NW - Stated that it seems the sewer trunk is being installed along Azurite because of the better grade and soils in that area; then the businesses on Azurite are expected to participate. Mr. Gorecki stated that he doesn't have a need for sewer and water now and is opposed to the project. Mr. Raatikka stated that Azurite is more condusive to construction; assessments to properties along Azurite could be deferred. October 20, 1986 Page 2 of 6