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Mounds View City Council October 11, 1999
<br /> Regular Meeting Page 30
<br /> that a problem exists, and there is a need to create funding for street reconstruction projects,
<br /> however, they have not examined the plan, the revenue sources, the costs or any of these factors.
<br /> He stated it would be premature to pass the franchise fee increase at this time. He added he did
<br /> not believe it would be harmful if the Council desired to dedicate a portion of the 2.5 percent fee
<br /> to the streets, and he would not oppose this.
<br /> MOTION/SECOND: Stigney/ . To Adopt Ordinance 641, an Ordinance Implementing
<br /> a Franchise Fee on Northern States Power Company Electric and Natural Gas Operations Within
<br /> the City of Mounds View, and Ordinance 643, an Ordinance Implementing a Franchise Fee on
<br /> Reliant Energy Minnegasco Natural Gas Operations Within the City of Mounds View, at the
<br /> Rate of 2.5 Percent, to Sunset in One Year.
<br /> Motion failed for lack of a second.
<br /> MOTION/SECOND: Quick/Marty. To Waive the Readings and Approve Second Reading and
<br /> Adoption of Ordinance 641, an Ordinance Implementing a Franchise Fee on Northern States
<br /> Power Company Electric and Natural Gas Operations Within the City of Mounds View, and
<br /> Ordinance 643, an Ordinance Implementing a Franchise Fee on Reliant Energy Minnegasco
<br /> Natural Gas Operations Within the City of Mounds View, at the Rate of 4 Percent, to Sunset in
<br /> the Year 2000.
<br /> Council Member Stigney explained as the Council was not aware of how much money is
<br /> required, or when it will be required, this one year only fund will not do anything for street
<br /> reconstruction, and this will be an ongoing issue. He explained the interest accrued on the City's
<br /> Tax Increment Funds is 2.4 million dollars, and this could be channeled toward the
<br /> reconstruction costs rather than implementing an additional franchise fee. He stated within the
<br /> three year time frame discussed for road reconstruction projects to continue, they must have an
<br /> idea of which roads require reconstruction, which are MSA, what is the shortfall of necessary
<br /> funds, and what money are they attempting to make up, in what period of time. He noted, if this
<br /> is an ongoing consideration, and he was certain they would be constructing roads for many years,
<br /> the golf course was planned to begin to provide money to the City after 16 years, in the year
<br /> 2015, which could be a good source of revenue. He stated Tax Increment Financing District
<br /> expirations will occur in the year 2015, and all of that money could go back into the tax base.
<br /> Council Member Stigney explained that the creation of a fund that will sustain itself, i.e., a 30-
<br /> million dollar fund, this was not realistic, and would never occur by increasing the franchise fee
<br /> to 4 percent. He stated the issue to consider is cash flowing the projects, and that is to determine
<br /> what money is needed when, and what is the best source for obtaining it, rather than increasing
<br /> the franchise fee.
<br /> Council Member Stigney reiterated there has been no communication in terms of notifying the
<br /> residents of this proposal, and if they support it, so be it, however, in lieu of any support from the
<br /> residents, he opposes this action.
<br /> City Administrator Whiting stated the ordinances which were provided to the Council Members'
<br /> should indicate not only 4 percent, but a sunset date which was originally drafted as the year
<br /> 2001. He pointed out that the discussion at the prior Work Session, and that date, has indicated a
<br /> sunset in the year 2000.
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