Minutes - Council Work Session - 10/26/2021

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tax levy, which is difficult to adjust to each individual property. He stated if the Council wanted to continue the rebate, the suggestion would be to continue with $168 for the commercial properties. In that case, the revenue impact is around $56,000 to the program which is not that substantial if the Council felt it was important to continue the rebate program. Finance Director Lund commented it would follow the same procedure the City is currently doing. Staff sends out a letter and they have to apply. If the City gets a letter back saying the resident wants the rebate, they get it back. She noted staff is not sending everybody a check if they are on the list because they have to apply for it and only the original assessment holder of the property would be eligible. She noted that following the same item, it will be going out in January because they paid through December. During that time, she will include in the letter that the franchise fee has been eliminated but the rebate program would continue for the term of their assessment. Councilmember Riley stated it makes sense to do rebates based on the year they are continuing but to not tie it to a franchise fee that no longer exists. Councilmember Musgrove stated her point in bringing it up was because that was a part of the $1.9 million that was raised so it looks like the City has set aside $50,000 a year. But they came under budget because the budget is $56,000. That is the purpose behind looking to see if that can still continue because that is accounted in the $1.9 million. She wasn’t sure if more information could be provided. Finance Director Lund answered that the $1.9 million was based off the amount needed to have the franchise fee generated. The projects that are listed in the pavement management, the $1.9 million was an average over a 10-year period of time and it fluctuates. She noted the rebate is still staying in effect for 2021 to pay out the people that have paid the franchise fee. The $1.9 million was an average of what was needed for the franchise fee back when they did the pavement management. Councilmember Heineman stated his understanding that when they did the rebate for the franchise fee, it was with the understanding that there are certain amounts of time when people were being assessed, and others weren’t. When the franchise fee came, it was a new mechanism to pay for roads. Since they were taking ownership of part of the payment off the individual and putting it on the community, the City gave the individual part of their assessment back. He noted the same principal is true if it is over the franchise fee or over a levy. He stated the fact is that there are a lot of people that paid into an individual assessment but the burden has shifted now to the community so it’s the right thing to do, to make sure those who were assessed during that period get paid back. Councilmember Riley asked if it shouldn’t be an increase in tax that they are realizing this year. Councilmember Specht answered that would be harder to figure out. City Administrator Ulrich commented that another option would be to give a percentage of their annual assessment back, to not base it on the franchise fee. He stated if the Council is interested in that option, staff could run the numbers on that. City Council Work Session / October 26, 2021 Page 13 of 15