05/08/2002 Council Minutes - Laserfiche WebLink

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APPROVED CITY COUNCIL WORK SESSION MAY 8, 2002 • Councilmember Dahl asked who is helping to fund the stoplight that will be installed. Finance Director Rolek stated the City has a cooperative agreement with the County to help fund the stoplight. • • Councilmember O'Donnell asked if the bonds will have an impact on the City's current bond rating. Finance Director Rolek stated the bonds will not have an affect on the City's current rating. The City's debt ratio has dropped in the past few years. This item will appear on the regular Council agenda Monday, May 13, 2002, 6:30 p.m. PROPOSAL FROM CENTENNIAL UTILITIES, LINDA WAITE SMITH City Administrator Waite Smith referred to a copy of a proposal from Centennial Utilities that was previously distributed to the Council. She noted this issue has been ongoing for the past five years. Centennial Utilities is concerned that they are being charged a franchise fee and other companies are not being required to pay a franchise fee. Centennial Utilities is proposing they pay the same amount in franchise fees as Minnegasco pays in property taxes. Centennial has requested to meet with the Council if their proposals are not acceptable. Acting Mayor Reinert asked when the current franchise agreement was signed by Centennial Utilities. City Administrator Waite Smith stated the current agreement was signed in 1992 for a twenty-year term. Acting Mayor Reinert asked what has changed since the agreement was signed. City Administrator Waite Smith indicated she will ask Centennial Utilities about that issue. Councilmember Carlson clarified that Centennial Utilities paid $56,000 last year as opposed to $80,000 the year before. Finance Director Rolek stated that the franchise fee caused concern for Centennial Utilities when the price of natural gas went up. City Administrator Waite Smith stated that Minnegasco's agreement also raised the issue of franchise fees. Councilmember O'Donnell asked why the cover letter from Centennial Utilities indicates the Council is not interested in a cap on the franchise fees. City Administrator Waite Smith stated she is not sure why Centennial Utilities put that statement in the cover letter. Councilmember O'Donnell stated he is concerned because the franchise fee is a source of revenue for the City that is built into the budget. If that amount is removed from the budget it will have to be made up somehow.