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COUNCIL MINUTES September 12,2011 APPROVED 181 wouldn't necessarily guarantee that it will remain valid. So it begs the question of why should you 182 add the language? The Commission's authority is narrow and is laid out in statute. Another issue 183 raised is about creating authority for the Commission to get into the public information area, a job that 184 is given to the city council by state statute. He questions if a charter commission can create authority 185 for itself Charters are generally speaking constitutions designed to decide how a city operates and 186 not how the Commission operates. Mr. Langel noted that he also has a concern about the amendment 187 dealing with granting use of public funds. The language implies that the council cannot do what it is 188 responsible for doing unless it provides equal funding to the Commission. While the Commission 189 representative has indicated that that language is intended to get the two bodies to work together, Mr. 190 Langel fears it would have the opposite effect in keeping the work from getting done. The language 191 also seems to imply that there are always two sides to an amendment; the fact is that neither side 192 cannot advocate. If there is an issue about the past and a goal to prevent it to happen again, the 193 answer wouldn't seem to be a charter amendment but a rather to find a process whereby the groups 194 will work together. The mayor confirmed that the Commission has had the opportunity to review 195 Mr. Langel's written comments. 196 197 Terri Heaton, Springsted, financial advisor to the City, indicated that she would be reviewing her 198 written comments regarding the proposed Chapter 7 charter amendment. As financial advisor to the 199 city, it is her job to consider the city's ongoing ability to finance its operations and meet debt 200 obligations as well as meet ongoing capital needs. She has looked at the proposed levy limit language 201 (to continue a levy limit for this city) using 2010 rates. Currently, the city has reacted to the reduction 202 in its tax base by reducing its levy. The current state limit would actually allow the city to levy higher :03 than it is proposing. By locking into a low year, the city may put itself in a different position than x204 other cities in how it can respond when the economy comes back. Another portion of the proposed 205 amendment deals with special levies and she noted that many are not funded from tax base and 206 melding them into a tax cap as the proposed amendment seems to do is unclear. Another item 207 includes restriction of special levies to a vote process and she sees that could limit the city's 208 flexibility, an item that is a key area that credit agencies look at. She noted that she sees credit 209 agencies comparing cities more for rating purposes these days, looking at flexibilities for instance, 210 and they are changing ratings much more than in the past. The city should also consider the 211 systematic replacement of infrastructure and maintaining the ability to do replacement at the most 212 effective time. Ms. Heaton also expressed that the amendment is confusing in that it uses the term 213 "net tax capacity" but Minnesota cities do not use mil rates so that term doesn't make sense with 214 current law. There was discussion about tax increment financing and that it is a tool that is being 215 used by many cities and very effectively for development. A city's tax base grows when the tax 216 increment capture period ends. Regarding the proposed amendment, it would allow the city to use tax 217 increment but without the same advantages as other cities in that the increment is pulled away from 218 the development. She pointed out that the council should consider the possibility of a negative impact 219 on the bond rating, that sending more matters to voters is costly in terms of special elections and that 220 the city's long term sustainability could be challenged by tying hands to a rate at an economically low 221 time. When the mayor asked if there is a"good" way to do a tax cap, Ms. Heaton responded that 222 citizens should be confident that they are getting the best value for their tax dollar and there are ways 223 for the council to know that. 224 5