Agenda - Council - 09/24/2013 - Laserfiche WebLink

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Mayor Strommen stated the City will get there and that would be her goal (fund roads through the levy) but because of levy limits, it will not be this year and possibly not for the next couple of years. Councilmember Tossey stated it is an insincere argument to say the decision is whether to cut cops or firemen when the City is levying the EDA and HRA. He stated EDA and HRA are not essential services and he finds a franchise fee to be absolutely ridiculous. Mayor Strommen stated there is not a list of options that add up to what is needed to fund the SMP without devastating consequences. She stated not all on the City Council will be at the same place at the end of this conversation. City Administrator Ulrich asked if there is interest in maintaining 20% assessment. Councilmember Kuzma asked if it has been decided what the franchise fee rate should be set at. Finance Director Lund stated if the SMP costs $2.2 million and $500,000 comes from the budget, it would take a franchise fee of $8 per month per utility for residential and commercial to raise $1.65 million. If the franchise fee is increased to $8 per month per utility for residential and $16 per month per utility for commercial, it would raise an additional $100,000. Councilmember Kuzma supported a franchise fee with a sunset date. He stated this can be discussed all night but the City Council needs to find a solution to road funding and residents have indicated a preference for smaller payments. Councilmember Riley stated either the City has to tax and assess or consider a franchise fee. He stated he cannot support both an assessment and franchise fee but does not have a preferred way. Mayor Strommen stated there is majority consensus for a franchise fee; however, once the levy is set next week it cannot be increased. Councilmember Tossey asked if the levy will not be the maximum allowed. Finance Director Lund stated if using the maximum levy by adding $931,000, the tax rate would be 48% (Option B, Maximum General/EDA Levy at $8,413,798 [This was City's total 2012 Certified Levy] for a $931,285 increase per the Department of Revenue as of August 27, 2013, allowing Special Levies in calculation). Councilmember Tossey asked if the City Council is supporting an increase in the levy, franchise fees, plus assessments. Mayor Strommen stated the City Council has indicated there is no interest in both franchise fees plus assessments. Councilmember Tossey asked if there is an option for a $4 per month per utility franchise fee. City Council Work Session / September 3, 2013 Page 8 of 12