07-27-1992 CC - Laserfiche WebLink

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Mounds View City Council Page Fifteen alar Meeting July 27, 1992 • franchise fee agreements for gas and electrical energy have been negotiated and provide for the desired payment schedule.. MOTION/SECOND: Quick/Wuori to Set a Public Hearing for 7:05 p.m. on August 24, 1992 to Consider an Ordinance Approving an Electrical Energy Franchise Agreement with Northern States Power. 5 ayes 0 nays Motion Carried E. Samantha Orduno, City Administrator, gave information in last item to also cover this item. • MOTION/SECOND: Quick/Wuori to set a public hearing for 7:10 p.m. on August 24, 1992, to Consider an Ordinance Approving a Gas Energy Franchise Agreement with Northern States Power 5 ayes 0 nays Motion Carried F. Samantha Orduno reviewed Staff Report No. 92-337C regarding the setting of a public hearing for 7:15 p.m. on August 24, 1992 to consider an ordinance implementing a franchise fee on gas and electric utilities. Orduno stated that over the past several • years cities have experienced declining revenues due to such factors as State cuts to Local Government Aid, reductions in residential and commercial/industrial property tax rates, reduced investment earnings, less construction and development resulting in declines in permit fees and now a recession that is further exacerbating an already dangerous situation. The consequences of this dilemma is the move toward user fees, franchise fees and other non-property tax revenues. A franchise fee is an example of a user fee based revenue program imposed on a company conducting business for profit within the City limits. The City currently has a franchise agreement with North Central Cable. The Cable Company conducts business in the City and for that privilege, the company pays the City a franchise fee of 5% to be used only for the City's municipal cable operations. Councilmember Rickaby stated that these methods are just property tax raises in disguise and that by doing it this way it is an attempt to avoid the clamber of people coming in to make comments about the City raising people's taxes. The people have the right to these comments. Mayor Linke stated that he takes exception. to Councilmember Rickaby's statement with regard to avoiding the clamber of people coming to the hearings. Mayor Linke feels these franchise methods would aid in buying down property tax increases for the homeowner. These fees are controllable by the homeowner as they are based on electric and gas usage. The churches and schools, who pay no taxes, will now share in this burden. Linke stated that for many years people