10-21-08 Council Special Minutes

Home Browse Search

MINUTES CITY COUNCIL OCTOBER 21, 2008 property taxes. In that case, the assessment would be spread over a ten year period and would accrue interest at a rate of 6.25%. The Engineer noted that senior citizens and disabled individuals have the option to request a deferment of their assessment provided that they meet low income guidelines. The Engineer also reported that assessment costs and/or interest on the assessment aie not tax deductible. Homeowners could take out a home equity loan to pay the assessment and the interest on that loan may be tax deductible. The Engineer suggested that property owners verify this information with their tax advisor. Bob Scalze, 696 Beam Avenue, asked how the 6.25% was determined. The City Administrator reported that the City's fiscal advisor recommends the interest rate based on the rate being charged fora 10-year bond plus 2% interest so that the City can make cash flow payments. Mark Johnson, 975 Beam Avenue, asked about the certification of the special assessment. The City Administrator replied that, if adopted, property owners have 30 days to pay in full or part at City Hall with no interest. If not paid, the City will certify the assessment for collection with property taxes. Interest is added from the date of adoption of the assessment; therefore, the frst year's interest is slightly higher. The assessment is spread for ten years with property taxes. Payments are collected on May 15 and October 15 of each year along with the property tax payment. Johnson asked why the interest was not tax deductible. The City Administrator reported that State and Federal Tax Law governs this issue. Bev Scalze, 696 Beam Avenue, asked about the looping of the watermain as well as whether sewer lift stations will be necessary when adjacent properties develop. The City Engineer reported that currently the watermain is not looped. The City plans to loop this line when the LaBore Road properties develop. Water pressure and water quality will be fine without the loop, but will be better once the line is looped. The Engineer indicated that the sanitary sewer line will be extended to the LaBore Road properties as development occurs. Running the line now will save costs eliminating the need for future lift stations for the LaBore Road area. The City Administrator indicated that when the Richie Place property is developed, a lift station would be necessary if this sewer line had not been extended. The cost of a lift station is at least $100,000. The developer will be required to contribute an equivalent amount to offset the City's costs of extending sewer into the area. The Administrator indicated that the same situation is likely true for the future development of the Sculley