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28 <br />COUNCIL WORK SESSION MAY 26, 1992 <br />A water connection fee of $5.21 per year was implemented for <br />all municipal water users. <br />Explained how the increase in sales tax did help Lino Lakes. <br />(This is not true of all municipalities.) <br />Explained the relationship of state aid to property tax. <br />(As state aid was reduced, property taxes increase.) <br />Mr. Espe reviewed the charts outlining sources of revenue for <br />Lino Lakes. In 1991, property taxes represented 48% of the <br />City's revenue. <br />Mr. Espe reviewed the expenditures for 1991. He noted that <br />public safety used 37.25% of the budget, public works 20.65 %, <br />parks 10.74 %, capital outlay 2.25% and general government 28.10 %. <br />The collection of delinquent taxes continues to be very strong. <br />The collection rate was 99% in 1991. However, the collection of <br />special assessments continues to fluctuate. Mr. Espe noted that <br />the ability to collect special assessments in a timely manner is <br />vital to the financing of the Special Assessment Debt Service <br />Fund. He recommended that the City monitor the collection rate <br />and provide supplemental financing if assessment collections are <br />not adequate to meet bond debt payments. <br />Mr. Espe addressed the Area and Connection Fund. This fund will <br />eventually account for area and unit assessments for funding <br />various debt issues. This City has amended collection procedures <br />on the fund but should continue to monitor it as well. <br />Mr. Espe noted that MWCC bills all municipalities annually on an <br />estimated basis. These billings are later adjusted and <br />municipalities are billed the additional amount or are given <br />refunds. Mr. Espe noted that billing increases have been <br />substantial over the past several years. Lino Lakes estimated <br />cost for 1992 increased 33% over 1991. <br />Mr. Espe reviewed the Gas Utility Fund. He recommended that Lino <br />Lakes request Circle Pines to provide their calculation of <br />franchise fee remittances including bad debt adjustments. He <br />recommended that this City review with the City of Circle Pines <br />their methods of enforcing collection and consider adopting such <br />procedures within the City such as including significant <br />outstanding delinquent billings on assessment search records. <br />Mr. Espe reviewed actions taken by the City regarding the gas <br />utility operations and outlined some provision of the new <br />agreement. He also reviewed the summary of considerations <br />prepared by Tautges, Redpath and Company, LTD. which was prepared <br />to help the City decide whether the Lino Lakes portion of the gas <br />PAGE 2 <br />