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services are paid for by the tax system, but with fees the City is able to create revenue from those entities that do not pay taxes. Lamb explained that due to the recent political atmosphere, the description and commentary on fees and taxes was necessary. • Mayor Gehrz then asked for any changes. Councilmember Lamb replied he had none, and felt at ease with the increase since Falcon Heights will remain in the lowest third in comparison with other cities. Councilmember Lindstrom stated he agreed with Lamb for the same reasons. He noted that whether it is taxes or fees, the council is reluctant to make increases, and do it only when necessary and on a slight scale. Councilmember Talbot echoed Lamb's statements and gave thanks for the fee/tax explanation. He noted public is invited to attend workshop meetings, held the first Wednesday of each month at 6:00 p.m. Councilmember Kuettel then pointed out that if the City has deficits in funds that are supported by revenues from fees, and the City does not change the fee to erase any deficits, it makes a difference in the bond rating of the City. She stated she was in favor of the increase. Mayor Gehrz then added she was also in favor and felt the change was necessary. She noted that people have asked her why sanitary sewer is not billed by volume. usage. The cost of billing by usage are high, because of capital costs associated with installation of flow meters ,and billing it as a flat fee is much more cost effective. She stated her appreciation of staff for providing the information on the funds. Councilmember Talbot .moved to approve the increase to $6.00 per quarter for residential, and $56.00 per quarter for commercial for the storm drainage fee, and an 11.4% increase for residential and commercial for sanitary sewer. The motion passed unanimously. 2. Approval of contract with Housing Resource Center for 2006 Administrator Worthington gave an overview of the services provided to Falcon Heights residents by the HRC. She drew the attention of the council to the spreadsheet of statistics on usage so far in 2005, and noted the contract renewal cost is $5,000. . Councilmember Talbot said that with increases in so many other things, the contract with HRC is useful, and he can't support it enough. Councilmember Kuettel noted that with the housing stock aging in Falcon Heights, it makes perfect sense to offer this service. Councilmember Lindstrom stated he has used HRC, and it was fantastic. Mayor Gehrz explained that before HRC, Falcon Heights was exploring getting an HRA and decided it wouldn't raise enough money, but with a small investment for HRC Falcon Heights gets a lot of services. Councilmember Talbot then explained that the contract fee is based on population. Larger cities pay more for HRC's services. Councilmember. Lamb then stated that Falcon Heights has the third highest market values in the county, and residents are dependent on their neighbors for the values of surrounding properties. He stated it is good to keep market values high (except during tax time). He also noted that for .$5,000 HRC will assist on a completely objective basis, unlike contractors who perhaps have a vested interest in recommendations, opinions and suggestions. Councilmember Kuettel moved to approve the contract with HRC for 2006 for $5,000. The motion passed unanimously. 3. Agreement for removal of a tree and assessment of costs Administrator Worthington gave background on the diseased elm tree at 1687 Larpenteur. She stated the property owner agreed to have the $2742.38 assessed to her property taxes in lieu of one lump sum payment to the City. Councilmember Lamb stated he had reservations on the item, stating the City was pushing the bounds of commercial lending. He asked whether the proper role of government was to become a lender for work done • to private property. He stated he was unsure of how we was going to vote on the item, but wanted to raise the point on principle. 3 ~CHG02:40069922.v1 ~9/28/OS 11:33 AM