Agenda Packets - 2009/09/14 - Laserfiche WebLink

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Mounds View City Council August 24, 2009 Regular Meeting Page 3 Ayes – 3 Nays – 2 (Hull, Flaherty) Motion carried. 1 2 B. 7:10 p.m. Public Hearing: Second Reading and Adoption of Ordinance 826, 3 Implementing a Franchise Fee on Xcel Electric and Natural Gas Operations 4 within the City of Mounds View. 5 6 Finance Director Beer advised the consideration is for second reading of the ordinance and 7 adoption by roll call vote. He reviewed the calculations and explained the ordinance would 8 continue the agreement with Xcel Energy to collect a franchise fee in the amount of 3.79% of 9 Xcel’s electric and natural gas operating revenue for services in Mounds View during the year 10 2010. Staff recommends adoption and that a summary ordinance be published in the Sun Focus. 11 12 Mayor Flaherty opened the public hearing at 7:20 p.m. 13 14 Dan Mueller, 8343 Groveland Road, stated at first reading the Council indicated they favored 15 lowering the fee but he believes everyone voted to raise the City levy. He stated he does not like 16 to pay taxes either, and his income has decreased since the first of the year, but he disagrees with 17 some on the Council saying they want to save people money yet all voted to increase the levy and 18 utility fees. Mayor Flaherty clarified that the utility fees increased based on increased usage; 19 however, the franchise fee is a different consideration. 20 21 Mr. Mueller stated that residents have no way of making up an extra fee but businesses can do 22 so. He noted the City is still $19,000 short and this fee will be a financial impact. Mayor 23 Flaherty stated he believed the fee was to sunset and while politicians often enact fees and say 24 they will sunset when no longer needed, that does not happen. He stated if the City needs money, 25 he would prefer to tell residents why it is needed rather than instituting a fee. 26 27 Mr. Mueller asked what the franchise fee was set up for originally. Clerk-Administrator Ericson 28 stated it was instituted in 1992 due to cash flow shortages, perhaps due to levy limits, and was to 29 sunset after five years. At that time, 100% went to the General Fund and later some was set aside 30 for streets. 31 32 Mr. Mueller asked if the money is no longer needed. Mayor Flaherty stated the need remains. 33 Mr. Mueller questioned how it can then be stated that the fee should have sunset. 34 35 Hearing no additional public input, Mayor Flaherty closed the public hearing at 7:30 p.m. 36 37 MOTION/SECOND: Stigney/Mueller. To Waive the Second Reading and Adopt Ordinance No. 38 826, Implementing a Franchise Fee on Xcel Energy Electric and Natural Gas Operations within 39 the City of Mounds View, and Publication by Summary Ordinance in the Sun Focus. 40 41 Council Member Stigney stated there is some confusion because “X” amount of dollars are 42 needed to run the City and can come from tax levies and/or fees. But, franchise fees are 43 attributed to non-profits and tax-exempt properties that taxes do not affect. He felt this is not the 44 time to consider an offset since 22% of the City is tied into TIF Districts, which cannot be taxed. 45