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Mounds View City Council October 11, 1999 Regular Meeting Page 22 Ex-Mayor McCarty commented, of all the arguments he has heard against the franchise fee, if it weren't for the fact that they now have a plan in place and the funds are needed, he would be standing on the other side of the issue. He stated, however, he also recognizes that these things that are demanded and seen as a definite need, are a service to the community. He noted the Council could not possibly make their decision on the basis of the 25 people who spoke to this issue that evening, and should bear in mind there are 12,758 people in the City. He stated it was his belief that they might be surprised, as he was surprised with the vote on the Bel Ray, which response was totally opposite of what he thought he had heard, and passed with a very heavy affirmative vote. He stated if this subject were to go to a referendum of the people in the City, there would be a hands down victory in favor of getting the roads fixed, and keeping the franchise fee in place. Ex-Mayor McCarty asked if the proposed increase did not represent approximately $20 per year, adding that the reduced value of his home would be much greater than this amount, if the proposal does not move forward. He remarked as a person who has disliked the franchise fee with a passion, it was not easy for him to stand before the Council and take the opposite position. He explained, however, he would make the same statement he made at the last budget, when they did away with some departments and other things that were not popular, he was going to make this decision with his calculator, and suggested the Council do the same. Mr. Weineke stated he was concerned, in light of this discussion, that there must be many other financial problems within the City that required to be addressed. He added he was concerned that things might "snowball," and the franchise fee might go from 4 percent to 5 percent, and so on. Mayor Coughlin explained that this fee could not go any higher than 4 percent. Mr. Weineke stated other fees might be implemented in the future. He inquired if there were other major financial concerns that would be coming forward in the future, adding that the residents might not be aware, and these matters should be brought to their attention. Ms. Olson noted Mayor Coughlin's comment that bonds are delayed taxation plus interest. She commented that in her understanding, bonds are not all delayed taxation, but some, such as the school bond, are additional taxation. She inquired how the 2.5 franchise fee was utilized during the past year. City Administrator Whiting stated the franchise fee, from its inception, has been directed to the City's General Fund to supplement General Fund revenues. Ms. Olson asked if there was any specific area to which the franchise fee was directed, or if this was simply additional taxation, going into the General Fund. Mayor Coughlin explained the fee was directed to the General Fund, adding that it could be called a fee or an assessment, but it is essentially, a tax. Ms. Olson inquired if there were any different plans for the 2.5 percent fee during the upcoming year, or if it would again be directed into the General Fund as an additional taxation. City Administrator Whiting explained the discussion to date indicates the amount of the franchise fee proposed to go into the General Fund is 2.5 percent, as it was for the last two years.