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I I I Council Meeting Minutes September 23, 1997 Page 3 Public Hearing. continued At the time of the feasibility study, the proposed assessment rates were found to be much higher than in past projects. The property along the northside of 1-694 contains no lots and may be the primary reason for the higher rates. Council suggested inclusion of those fictitious lots into the assessment formula which the City would pickup that cost to provide a lower rate for property owners. Also, the project received very good bids which provided further reductions. The existing Emerald Dr. storm sewer was replaced, and the storm sewer on 22nd Ave. and 10th St. was enlarged and two catch basins added. The $103,039.33 cost of these upgrades will be paid from the Storm Water Utility Fund. Another storm sewer was installed on the Highview school property which will be special assessed to the school district. Two sanitary sewer mains were repaired at a cost of $3,899.68, and will be paid from the sanitary sewer utility fund. Eleven water services were insulated and paid from the water utility fund. Proper said the entire project has been completed except two driveways which are scheduled to be replaced. Residents have 30 days to pay the assessment in full, and after that time it is certified to Ramsey County for collection with property taxes. The assessment will be charged a 6.5% interest rate over the lO-year collection period. Walt Witzke, 771 Emerald Dr., asked for a summary of the financing procedures for the City portion. Proper explained that the City sells bonds to finance the total project cost, and those bonds are repaid through a combination of City taxes and special assessments. Witzke noted that the City sells improvement bonds at a 5 % interest rate, but charges residents a 6.5 % interest rate over a 10 year period. Witzke feels a more appropriate rate to charge residents would be 3/4% or 1 % over the bond sale rate. City Manager Matthew Fulton explained that the project cost is funded with internal reserves until there is sufficient amount to provide a bond issue. A bond is established for reimbursing the dollars which were expended. Typically, assessment charges are tied to City policy which recommends 1.5 % above actual bond costs. Witzke requested Council consider assessing property owners 1 % over bond costs. Fulton added that New Brighton is right in line with assessment policies of other municipalities. Proper explained that the 1.5% is on the advice from the City's Fiscal Consultant. Samuelson requested a copy of the letter from the fiscal consultant be made available to Witzke. Larson believes it is important the City policy be consistent for all improvement projects, and has much confidence in the finance staff and the fiscal consultants. Rebelein noted that interest percentages are reviewed continually, and staff would confer with Council if there is some issue with bond issuance costs or schedule delays. Syd McCasheu, 749 22nd Ave., asked why is he assessed at the existing bituminous curbing rate when he has concrete curbing. Proper acknowledged this is a confusing situation. Originally, the lot was constructed with bituminous curbing. In 1969, the adjacent cul-de-sac was constructed, and McCasheu's property and another received concrete curbing as part of the project. Because records indicate that McCasheu was never assessed for concrete curbing, staff is required to apply an assessment reflecting the original bituminous curbing. McCasheu said he purchased the home in 1972, and was not in ownership when the cul-de-sac was constructed. McCasheu said the former owner provided a land exchange to allow adequate turnaround area for the cul-de-sac. Public Hearing Assessments for Project 96-1 Project 96-4 Project 97-14 Report 97-214 Resolution 97-067 Resolution 97-068 Resolution 97-069 Resolution 97-070 Resolution 97-071 Resolution 97-072