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review shall be for the City Council to determine the City's necessity to receive the revermes gcncratcd by the fi'anchise fee. Finance Officer Lund reviewed that for the period ending March 31, 2004, the City received $129,839 in fi'anchise fees from Connexus Energy and Centerpoint Energy - $69,905 and $63,934, respectively. Based on total customers information submitted by Centerpoint and Connexus ill 2003, the City planned to generate $404,000 in franchise fee revenue, which is the amount included in the 2004 adopted General Fund budget. Year 2004 totals would show the City collecting approximately $519,356 based on the first quarter collection of $129,839. This would give an increase of $115,356 over 2004 budgeted numbers. She advised per the franchise Icc ordinance, the City Council must quarterly adopt a Resolution stating that the revenues are necessary and that they plan to continue the franchise fee. Councihncmber Strommen stated given these numbers and the numbers of Case 1, which they have not yet considered, she has a hard time continuing the fee when it looks like the revenues arc coming ill where projected, and the franchise fees above where projected. When this ordinance was passed there was a sense that it should be discontinued if they got into this type of situation. Councilmcmber Zimmern~an suggested there be serious consideration of discontinuing the fee after tile review of the second quarter. Chairperson Elvig concurred. He noted the reason the franchise fee was started was so that the City would not get behind in the budget. It looks like the fees are doing fairly well, however, interest rates are supposed to start to spike again in August, and there are still some unknowns llOW. Cotmcihnembcr Strommen commented a review at six months would give the City the safety net they wcrc looking roi' in passing this ordinance in the first place, without overdoing it. Motion by Cotmcihnember Zimmerman, seconded by Councilmember Strommen, to recommend thc City Council continue collecting franchise fee revenue with the determination that the continuation or repeal of the franchise fee will be determined at each succeeding quarter, and with the idea that the consideration of the repeal will be seriously considered at the end of the second quarter. Motion carried. Voting Yes: Strommen. Voting No: None. Chairperson Elvig, and Councilmembers Zimmerman and Case #1: Authorize Transfer of General Fund Revenues Finance O£ficer Lund reviewed that the City Council adopted a policy on February 22, 1994, known as the Excess Revenue Policy, which establishes a financial policy for the purpose of allocation ol' excess or deficient general fnnd reserves. After meeting the fund balance rcquirenaents att tile year end, $650,965.94 remained as excess revenues to be transferred from the Finance Committee/April 27, 2004 Page 6 of 9