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Gordon Heitke January 28, 2008 Page 10 of 13 Section 8.08. City Council Action. Subdivision 1. This subdivision describes the procedure for council approval of the preferred alternative. There are three significant concerns with the language. First, the council acts on the alternative "preferred by the largest number of property owners." This apparently means that an alternative may be approved —or all the alternatives disapproved by a plurality vote of the owners who filed preferences, with no minimum portion of all owners being represented. The effect is that significant decisions about a public project could be made by a small minority of affected owners. Second, the language indicates the council shall approve the alternative with the most votes, which deprives the council of its legislative discretion altogether. The result could be that the council is required to undertake a project that implicates city finances (other than special assessments), perhaps against the wishes of a majority of the elected council and at the direction of a minority of the affected owners (i.e., those who filed their preferences). There is some question whether this system represents an unlawful delegation of legislative power, which conflicts with a fundamental statewide policy and is therefore beyond the authority of a city charter. Third, as noted in the discussion under Section 8.07, there are many questions about who can file preferences and how they are counted. In order to ascertain that an improvement is properly ordered, bond counsel is presented with a significant challenge of both interpretation and factual evidence (requiring detailed review of the petition and preference records, perhaps reaching to review of title to clarify ownership). It may not be possible to conclude without qualification (which is the standard for a bond opinion) that projects under this system are properly ordered and bonds secured by related assessments are validly issued. Subdivision 2. This subdivision calls for a second 60 -day waiting period after Council approval of the project, to allow for a reverse referendum described in Section 8.09. This subdivision contains two significant flaws. First, on its face it applies the reverse referendum process to all projects approved by the Council under Subdivision 1. However, Section 8.09 by its terms applies only when an improvement is funded in part through general revenue. The two provisions cannot be reconciled where a project is financed with special assessments and other funds that are not "general revenues." Second, the subdivision states that taxpayers are given "this 60 -day period so that they may petition for a referendum," implying that a petition must be filed within 60 days after the date of council action on the improvement. However, Section 8.09, subdivision 2 expressly states that a petition must be submitted "[p]rior to the first regular City Council meeting occurring after the end of the 60 -day period described in Section 8.08, subdivision 2." In other words, the filing period is not 60 days, but the period from council approval of the improvement to the date of the next council meeting after expiration of the 60 -day waiting period. This is a technical point, but such imprecision creates confusion for citizens and legal counsel alike. 327632v3 SJB LN140 -86 • • •