5.3. SR 01-21-1997 - Laserfiche WebLink

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-'ity of iver ITEM 5.3. MEMORANDUM FROM: DATE: SUBJECT: Mayor & City Council Pat Klaers, City Admin~tr~rtor January 21, 1997 t:~ Rebate of Interest Payment to Sherburne County This is an old issue which now needs to be addressed. In about 1975, the city improved the public parking lot behind the Utilities office and assessed this cost out to the benefited property owners. The assessment timeframe was 15 years and the interest rate was 7 percent. Sherburne County, across the street from this project, was one of the benefited property owners and paid the assessments for about ten years. However, the county stopped payments in 1985, citing no direct benefit for this project. Special assessments must be paid before a land transaction can take place. The county closed on its transaction for selling the administration building to the school district on 1/15/97. Prior to this closing the county paid the city $4,113.14 in principal and $3,455.04 in interest. At this time the county is asking the city for forgiveness of the interest amount. The city paid the principal on this assessment when the county did not make its payments. Accordingly, the city also had to pay the interest due on this part of these bonds. The city also lost revenue on the $4,100 which it would had invested after the bonds were completely paid. The city could reject the county's request in its entirety, but in an effort to show cooperation between units of government and to show support for this school/county transaction, it is recommended that the city split this interest amount on a 50/50 basis and that we rebate the county $1,727.52. Recommendation It is recommended that the City Council approve a motion authorizing the payment of $1,727.52 to the county as a partial rebate of their interest payment for the parking lot public improvement project. \Xelkriver\sysXshrdocXcouncil\ctyrebat.doc 13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425