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