Minutes - Council Work Session - 10/24/2006

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costs for the grant from January 2007 to October 2008. Mr. Lasher reported on the following total costs and net costs for each of the above scenarios: · Option A - $460,557 ($19,189/month) with a federal refund of$321,313 in October 2008 = $132,243 city cost · Option B - $769,163 ($32,048/month) with a federal refund of $472,759 in October 2008 = $296,404 city cost · Option C - $309,658 ($12,902/month) with a federal refund of $245,864 in October 2008 = $63,794 city cost Mr. Lasher indicated he will determine the flexibility the farebox allows and how it works with the fare cards and provide information back to the Council. Public Works Director Olson indicated the action tonight will be to discuss issuing a Letter of Intent to Laidlaw Transit Services Inc. to begin the five-week start up process and to order fareboxes for the two buses. Laidlaw has agreed to initiate this process once it receives a Letter of Intent from the City that guarantees the cost of the start up at $17,481.30 and fareboxes at $25,000 should the Ramsey Star Express service not be initiated. This cost is already included in the contract but Laidlaw wants to be guaranteed they will not be held accountable for the cost of the fareboxes. This case will be on the Council agenda tonight. Councilmember Cook inquired about the funding source for covering the cost of advancing the service. Finance Officer Lund indicated the overall cost to the City will be approximately $138,000. An internal loan from the Equipment Revolving Loan Fund could be paid back at 5.25% interest or an internal loan could be done for the first few months prior to issuing bonds. An internal loan will be required to cover the costs for October, November and December. The current balance in the Equipment Revolving Loan Fund is $4,299,000. Councilmember Elvig expressed support in paying the interest back to the City in the Revolving Loan Fund, rather than bonding and paying the interest to an outside source. Councilmember Cook commented on needs for the Fire Station that will likely require utilizing the Equipment Revolving Loan Fund. Consensus of the Council was to utilize the Equipment Revolving Fund as an internal loan for the associated costs of the start up process and fareboxes for the Ramsey Star Express, with the funds to be paid back when the CMAQ grant is received; city costs beyond the federal reimbursement are not to be repaid into the Equipment Revolving Fund. Council further discussed rate options for the commuter coach service. Consensus of the Council was to designate a $2.75 rate for the Ramsey Star Express fareboxes. Mr. Lasher indicated he will rerun the fare calculations based on the $2.75 fare and obtain information on the rate flexibility allowed with the fareboxes. City Council Work Session / October 24, 2006 Page 3 of 4