Agenda - Council - 11/24/1992 - Laserfiche WebLink

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CASE # INTRODUCE FRANCHISE FEE ORDINANCE By: Ryan R. Schroeder, City Administrator Background:; For the Past s~.veral years, cities have been restricted to varying State mandated levy limitationS. Tills has resulted in severe restrictions on operations of growing cities such as RamSey2 iAt !~e same time the State has reduced the actual dollars received in local govemrrient al.ds. Finally in thelast few years, the State has begun billing us in additional ways such as fees for PCA~, DNR~ and other State departmental operations and most recently implementation of a sales tax. , As a result of I[he above, cities have taken the approach of billing for services received by spec[tic iffflivi~tuals or businesses over and above levels received by the general public. As this relates to dtility companies, we allow them to have the exclusive use of a portion of our right,of~ayS.i Currently we have 147.8 miles of right-of-way. At a cost of $10,000/acre this is ~.issetlvalue of $14,336,600. To date, the utilities have not reimbursed the City of Ramse7 for t~e portion of the right-of-ways for which they have received the use. We have also:not billed them for services received when a new utility line or repair of a line occurs,~ it shbuld be noted here that if we need utility lines to move due to a public constmCti0n pfoject such as 153rd Avenue N.W., we will receive a bill. As a reSglt r,i the above, the City has proposed adoption of a franchise ordinance with Anoka Monit:[pal Electric and Anoka Electric Cooperative. A franchise ordinance currently exists 0ith lV flwest Gas. Within the proposed electric ordinance them is a fee provision in consideration of the rights granted to the electric distributors under the ordinance. The MidweSt Gas ordinance is silent on a possible franchise fee. It is the Staff position that pursuant tO an Attorney General opinion the fee levied upon the gas company is appropriate in exchange f Dr rights received within the franchise. The following are enclosed with this case; 1) Projected Franchise Fees and Property Tax Received from Fictitious 50 lot subdivision 2) 1992 Tax Capacity Comparison of 20 Area Cities 3) 1992 Tax Capacity Comparison of Minnesota Cities with Populations Between 10,000 and 20,000 4) 1989 Per Capita Expenditures (Excluding Capital Outlay) for Minnesota Cities with Populations from 10,000 to 20,000 5) City Growth Data 6) North Metro Mayors Tax Capacity Data 7) Utility Franchise Fee Comparative Date 8) AEC Monthly Revenues from December 1990 through November 1991 9) Midwest Gas Revenues from December 1990 through November 1991 10) i Comparison of Standard Residential Charges 11) ' Proposed Franchise Fee Ordinance The follOWing information is pertinent to this case: · 1993 Local Government Aid (LGA) to the City of Ramsey will be $230,799 less than ihe $446,122 payment received in 1989. In addition to previous cuts, cities risk losing additional LGA in the December payment for 1992 and for the year of 00