Agenda - Council - 10/22/2013 - Laserfiche WebLink

Home

Councilmember Backous stated a question was raised about having a tiered fee to counteract the progressive nature. City Administrator Ulrich stated a tiered method is easy if residential has one category and there are multiple -tiers for commercial. He explained if the City wants a residential tier it would be allowable, but the City would have to administer and rebate based on value of the home, resulting in high staff overhead in having to create a new billing system. Finance Director Lund stated the utility company does not charge an administrative fee and in 2003 and 2004, an administrative fee was also not charged. Mayor Strommen asked if the utility companies would be amenable to revising the ordinance language since that is their business practice. Finance Director Lund stated the utility companies could be asked. She recapped the 2014 budget, impact of levy limits, and indicated in prior years the tax rate was at about 44.28 and now it is at 43.37 so taxes should be constant or reduced. She then reviewed the three levies, explained the increases and how the Municipal Center debt was refinanced last year and use of tax increment funding this year will keep the tax rate constant. Finance Director Lund stated GASBY rules require to identify designated funds and only the City Council can decide to change the use of funds. With the 2003 franchise fee, the Council received a quarterly revenue report and the same reporting could be done if this franchise fee is approved. She explained the property taxes are received in a lump sum, not as a continual monthly revenue stream, and relies on everyone paying their taxes. Finance Director Lund reviewed the MSA fund allocation and projects to which it has been committed. She stated the utility companies are not able to accommodate a tiered fee but can create a new fee on the bill for "road reimbursement" and once established, it can go on the bill. Otherwise, a tiered rate would have to be administered manually through the City with a reimbursement check sent back to property owners. She stated the levy increased by $725,000 but there is a constant tax rate because of tax increment coming back on line. City Engineer Westby stated the County does not assess properties along its roads but uses other funding sources. He stated other cities fund street programs through bonding, assessments, MSA, and a dedicated street maintenance budgeted item if not using franchise fees. He described the maintenance schedule that had been presented and what the costs were based upon. City Engineer Westby stated the maintenance schedule does not have to be followed in every case and while the costs assume a full reconstruction at the end of the useable life of the road, it may require a reclaim that would be a much lower cost. He recommended that a regular sealcoating program be followed to prevent pavement from becoming brittle but explained that overlays may not be needed as scheduled. He stated he preferred to estimate high at this point than to come in low and not have funds at the end. City Engineer Westby agreed with the suggestion to define terms and did not think it would be an issue with the utility companies. Mayor Strommen stated questions were raised about the Charter and how it meshed with the Council's consideration of instituting a franchise fee. City Council / October 8, 2013 Page 18 of 24