Agenda Packets - 1987/01/26 - Laserfiche WebLink

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November 24, 1986 Page 7 It is my understanding that the Park Dedication fee paid by JLN Development could be approximately $200,000. If 2/3 of that fee ($133,333) were used to start a Park Improvement Fund the annual payment required to build a fund to $1,000,000 would be substantially reduced. The chart below presents the annual payment required to build the Fund under this option. ANNUAL PAYMENTS REQUIRED TO ACCUMULATE A FUND OF $1,000,000 ASSUMING A BEGINNING BALANCE OF $133,333 AND. INTEREST EARNINGS OF 5.5% PER ANNUM Number of Amount of Property Tax Levy Payments Annual Payment Needed for Payment 10 $59,979 1.04 Mills 15 $31,342 0.55 Mills 20 $17,522 0.30 Mills 25 $ 9,609 0.17 Mills The above examples assume that the property tax levy would be used to provide the payments to build the Fund. Other sources of financing, previously mentioned for Park Improvements, may be available to help build this Fund but are rather limited or would require a change of policy by the Council. These include: 1) the Silver Lake Woods Improvement Fund; 2) the Revolving Improvement Fund; 3) the Special Projects Fund; 4) and the Park Dedication Fund. Wayne Burmeister, Chairperson of the Parks Commission, suggested several alternative financing sources in his September 28, 1986 memorandum to the City Council. Some of these alternatives are viable options and should be pursued; others are not as viable. I will review those alternatives and offer my professional opinion on their viability. 1. Dedicate a one mill levy over the next five years. This is definitely a viable option and has been previously outlined in this memorandum. 2. Establish the fund which could then be built up to utilize monies from existing fund balance reserves. Most City Funds were established for special purposes. The monies contained in those funds may only be used for those purposes and would not be available for Park Improvements.