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Page 7 March 25, 1996 Mounds Vtew Ctty Counctl MOTION/SECOND: TrudeBlanchard to approve Resolution No. 4918, Setting Water Rates for 1996, adjusting it to $1.30 per 1,000 gallons of water. Duane McCarty, 8060 Long Lake Road, asked what is proposed for the Sewer REC. He was informed it is proposed at $45.50. He explained that the Charter deals with taxation of finances in Chapter 7 and in 7.04 it says the City budget shall provide a complete financial plan for all city funds and activities for the ensuing fiscal year. In Section 11.02 of the Charter it states that the Council may by ordinance fix rates, fares and prices for municipal utilities, and he assumes that the ordinance was passed at the time that the budget was passed (as required by the Charter). Ms. Trude stated she has talked with the city attorney about this very issue and it is her understanding that the Charter provisions have been followed in the rate setting. It is not mandatory that the rates be set by ordinance, and the process the council is following is the same process that has been used for the past five years. Mr. McCarty stated he assumes that the water and sewer rates were adopted as a part of the budget (as required by the Charter), and that they were set according to the Truth in Taxation last Fall, with the water rates set at $1.2511,000 gallons and the Sewer REC at $45.00/quarter. It is his belief that there is only one way to amend the budget under. the city Charter and that is to cut expenses -revenues cannot be raised. Bill Fritz, 8072 Long Lake Road, stated the city invested in a new water meter system to take care of the city's water deficit. Why was a new system put in if the city has a fund balance? Ms. Trude explained why a fund balance must be maintained. Ms. Blanchard asked that her SECOND be withdrawn. Ms. Trude asked that her MOTION be withdrawn. MOTION/SECOND: TrudeBlanchard to authorize the Acting City Administrator consult the City Attorney and have him write an opinion to the City Council stating the correct procedure under the City Charter to adopt the new water and sewer rates and to state whether they are authorized to set those rates at the time of the budget and then increase the rate above the budgeted amount. VOTE: 5 ayes 0 nay Motion Carved B. Consideration of Resolution No. 4919, Setting Sewer Rates Effective January 1, 1996. Action on this will be postponed until the City Attorney advises (see 11. (a).) C. Consideration of Resolution No. 4910, Revoking Municipal State Aid Street. Mr. Ulrich explained that this street was never constructed ,nor will it in the future because of the Business • Park expansion.