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Gordon Heitke <br />February 29, 2008 <br />Page 3 of 3 <br />The problem is language indicating that all public improvements be "primarily designed <br />to give a direct benefit to property currently occupied by residents or businesses in the <br />City" (emphasis added). This language is difficult to interpret, but could give the owners <br />of unoccupied property the right to avoid assessments in some circumstances. Depending <br />on the facts, the result could be different rights regarding assessments for occupied and <br />unoccupied property, which might violate the federal equal basis requirement described <br />above. <br />Citizen Proposal: Same as Charter Commission Proposal. <br />Mayor Bergeson also asked how the proposed Charter amendments could be altered to <br />correct the problem that requires issuance of taxable bonds. The only way to avoid the <br />private loan problem for all improvement bonds issued by the City is to remove the three <br />"special areas" from the existing Charter. That option might make sense if the Charter is <br />modified in a way that balances the City's various concerns, and avoids the need for <br />special rules in particular geographic areas. <br />The Task Force Proposal corrects the problem for improvements located entirely within <br />the special areas; the only remaining problem is the financing of improvements that <br />"straddle the boundary" of one or more of the special areas. Again, the Council might <br />consider whether the special areas are still needed in light of the other changes in the <br />Task Force Proposal. <br />In the Charter Commission Proposal, the first sentence of Section 8.01, subdivision 2 <br />would also need to be removed or revised to clarify that unoccupied property is subject to <br />assessments on the same basis as all other property. <br />If you or Council members have further questions on this matter, please let me know. <br />SJB <br />329677v1 SIB LN140-86 <br />