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City Council Minutes Page 10 <br /> November 19,2012 <br /> Mr. Simon noted,from Council direction provided,that as the budget is completed for 2013, <br /> staff will work with the goal of utilising the excess funds per the Fund Balance Policy over • <br /> the next several years.The Council concurred. <br /> 10.2 Pavement Management Program Funding Options <br /> Mr. Femrite presented the staff report.He noted that another city recently went through a <br /> public process for reviewing funding options and the preferred method was the franchise fee <br /> option. He indicated that determining how to make the process fair to property owners is a <br /> challenge but now may be the best time to make the change as most streets have been <br /> constructed or repaired within the last 20 years. He stated staff believed a franchise fee <br /> would be the fairest assessment to property owners. He reviewed the pros and cons of the <br /> options as noted in his staff report. Mr. Femrite noted that preventative maintenance is not <br /> included in these calculations. <br /> The Council discussed various unique scenarios and how it would affect property owners. <br /> Some questions discussed and to be reviewed further: <br /> 1. If franchise fee charged to gas and electric customers,what about capturing rural <br /> customers who may be using propane instead of gas. <br /> 2. What is the percent of properties not using gas? <br /> 3. What is the percentage of residents that have paid assessments for the last 10-15 <br /> years? <br /> 4. How should the 2010-2011 assessed property owners be phased in or incorporated <br /> into a plan? <br /> 5. How should property owners who paid their assessments up front versus financed • <br /> over time be reimbursed? <br /> 6. How to handle issues with a property owner versus tenant issues? <br /> 7. How do the different needs of commercial and industrial users get addressed? <br /> Should a franchise fee be based on usage or a flat amount?Concern over the rate <br /> charged to commercial/industrial users versus residential users and making sure not <br /> to drive business away. It was noted the Stormwater Management Fee may be <br /> coming forward soon also. <br /> 8. How would a franchise fee work for differing home values?What would be the <br /> basis for setting these fees? <br /> 9. How will implementation of a plan work? <br /> Attorney Beck noted the fees can't be set arbitrarily and the city will need to review what <br /> other communities have done,get guidance from the Public Utilities Commission,and <br /> review past court case history. <br /> Mr. Femrite stated staff favors Option 2 for ease of administration as far as creating a fair <br /> system for rebating the more recent assessment projects. <br /> Mayor Dietz stated he won't be in favor of the franchise fee option unless there is a better <br /> benefit for the business community. <br /> Councilmembers Zerwas and Gumphrey shared concerns regarding the expense to business <br /> owners and would like to see a more balanced approach between them and residential <br /> owners. • <br />