Minutes - Council - 11/12/1986 - Special

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the road should equalize. City Engineer Raatikka stated that he checked elevations on both sides of the road and the north side is about 7 inches lower than the south side and the road is acting as a damn. Motion by Councilmember Cox and seconded by Councilmember Sorteberg directing the City Street Department to install a culvert under 156th Avenue NW, west of Hematite Street NW. Motion carried. Voting Yes: Mayor Reimann, Councilmembers Sorteberg, Cox, Schlueter and DeLuca. Voting No: None. Councilmember Cox noted that the culvert installation does not necessarily mean that Mr. Terry Hendriksen's water problems will be resolved; the culvert will allow for the free flow of water through the area. Discuss Special Assessments For Sewer And Water Improvements In Ramsey's Industrial Area: Mr. Hartley stated that staff is presenting Council with 3 options for deferments/additional discounts for early payment to proposed assessments for sewer and water improvements in the Industrial area. The Economic Development Commission met the morning of November 12 and reviewed the options; that Commission recommends going with Option #1 modified to allow for a deferment period of 20 years, at which time payment will be due or the 10 year payment plan will begin. The option also includes that deferred assessments would be payable at the construction cost index rather than accruing interest over the period of deferment. Council and staff proceeded to review total project cost, total tax increment participation, projected incoming tax increment and existing tax increment commitments. Mr. Hartley stated that the City can offer deferments and assessment discount incentives for early payment because of tax increment funds the City is already receiving. Councilmember Cox stated that it might be more desireable to the property owners to have more of a cost break up front, i.e. higher percentage of tax increment participation in the project; no discounts for early payment; 5 year deferment period rather than 20 year. The City has to be careful not to make it more desireable to defer than to pay because the City will need that incoming revenue early in the project. Mr. Hartley agreed that it should not be more desireable to defer and cost indexing rather accruing interest becomes very attractive when the full 20 year deferment is taken. Councilmember Cox stated that the City has to protect existing businesses and promote new development. The City has to consider increasing the portion of the project covered by tax increment funds with the knowledge that the improvements will enhance the chances for property sale and development. Councilmember Cox expressed concern with tax increment cash flow and meeting the bond payments. Sp Council/November 12, 1986 Page 3 of 5