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c4 V , 22474 (41aneza <br />515 Little Canada Road, Little Canada, MN 55117-1600 <br />(651) 484 -2177 / FAX: (651) 484 -4538 <br />MEMORANDUM <br />TO: Mayor Fahey & Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: January 8, 1999 <br />RE: Revisions to Tri- District School's Utility Connection Agreements <br />MAYOR <br />Michael L Fahey <br />COUNCIL <br />Beverly Scalse <br />Jim LaValle <br />Steve Morelan <br />Bob Pedersen <br />ADMINISTRATOR <br />Joel R Hanson <br />In November, we discussed revisions to the Tri-County School District #6067 water and sewer <br />connection agreements. They currently have an outstanding balance of approximately $181,945 <br />with interest accruing at 7 %. Payments are to accrue on a 15 -year basis. <br />I recently met with Mr. P. Fred Storti, principal /administrator of the Tri- County School, and Mr. <br />Jene T. Sigvertsen, architect/project manager, about a different approach they would like us to <br />consider in the connection fees. They are proposing to pay us $67,000 in cash at this time. The <br />balance of approximately $114,000 would be amortized on a 15 -year basis at 6 %. I pointed out <br />to them our concerns about lowering the interest rate below that we charge to projects we have <br />assessed. I stated that a 61/2% rate would be more consistent with our past actions. I also <br />discussed with them the possibility of indexing the rate per the Council's direction. <br />I would recommend that we revise the connection agreements whereby we received a $67,000 <br />payment at this time with the outstanding balance to be financed over a 15 -year period at 61/2%. <br />If you agree with this recommendation, you would need to make the appropriate authorization. I <br />will then attempt to resolve this matter with the Tri-County School District. <br />JRH;kpp <br />cc: P. Fred Storti <br />Page 100 <br />