04-21-1992 CC MIN - Laserfiche WebLink

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Elk River City Council Minutes April 21, 1992 Page 3 . the water service suggested that some contractor to see if from of they the property the residents can get better line to the home. Terry Maurer get together and contact a rates as a group. Terry Maurer stated that another issue which was brought to the City's attention was partial prepayment of assessments. He indicated that the City Council also considered this request at its last Council meeting and authorized partial prepayment prior to certification of the assessment to the County. He indicated that this is as lenient as a City can be because of what is allowed by State law. Terry Maurer informed the residents that an error was made in the assessment schedules that were mailed to the residents regarding payment of interest due and payable with the first installment. He explained that the first year of the assessment only shows one month of interest and should show 13 months of interest. Terry also informed the residents that the entire assessment may be paid without interest until it is certified to the County. Terry Maurer explained that the assessment schedules payment period of 10 and 15 years according to the He indicated that the City will allow payment of up requested by the property owner. were run for a assessment amount. to 20 years if . Pat Klaers, City Administrator, explained that the interest shown on the assessment schedule mailed to the property owners is 8.25%. He explained that state law used to limit cities to charging no more than 1.5% over the bond sale interest, however, this law has been repealed. He stated that the City of Elk River's policy has been to stay at the 1.5% interest rate over the bond rate. He stated that the City must charge enough to cover expenses but not to make a profit. He further explained that the 1.5% charged over the bond sale interest is used to pay for delinquent assessments, to cover costs of deferrals and also to cover costs such as minor project changes and cost overruns. He stated that if there is any money left from the 1.5%, the money is then transferred into the Capital projects Fund and used to pay for other projects or components of the ongoing project. The City Engineer indicated that the City has received some questions regarding the Western Area project and the fact that the existing rural lots are not paying for trunk water main or trunk sewer main costs. Terry Maurer explained that the City Council is treating the Westwood Area in the same manner as there are no trunk sewer or water charges being charged to the Westwood residents. . Terry Maurer concluded that the recommendation made by staff for the assessment method, after looking at the five scenarios and after talking to the residents at the open house, was Assessment Method #1 which assessed properties on a front footage basis. Terry Maurer explained that after reviewing the market value appraisal by Peter PatChin, there were six properties that were assessed slightly more than the market value could support and requested the City Council to reduce these assessments to a limit at which the market value could support.