City Council Meeting Date: November 10, 2020
To: Mayor and City Council
From: Ben Martig, City Administrator
Title
Review Resolution Establishing Franchise Fee Rebate Program.
Body
Action Requested:
Discussion only.
Summary Report:
The City Council has reviewed offering a franchise fee rebate program in conjunction with considering implementing gas and electric franchise fees.
Please see attached memo by Doug Green, Director of Bakertilly Municipal Advisors.
Staff is still exploring whether other cities have offered such a program in conjunction with implementing franchise fees as an alternative to special assessments. To this point, we are only aware of the City of Elk River who used a similar method to the Option D program that would be only for residential properties who have outstanding special assessment obligations.
Staff will give a presentation at the meeting related to the options to provide opportunity for feedback from the City Council.
Alternative Options:
The following alternative options have been developed for consideration and discussion by Council. The Option A is the original template and we used redline changes from that document for illustrated purposes for Options B, C and D. Staff is not recommending to alter the fees proposed for the gas and electric franchise fees for any of these options. The costs would be absorbed with transitioning the program recaptured through either the fees or property tax revenues.
Option A - Rebate Program for Commercial/Residential Including Those Who Paid Off Assessments.
• Cost Estimate: $112,860 (see attached memo for each year by column totals for both residential and commercial)
• We anticipate additional staff or consulting fees to manage the program in the amount of about $25,000 annually at least to start. It eventually will be phased out.
Option B - Rebate Program for Residential Including Those Who Paid Off Assessments.
• Cost Estimate: $79,398 (see attached memo for each year by column totals for both residential)
• We anticipate additional staff or consulting fees to manage the program in the amount of about $20,000 annually at least to start. It eventually will be phased out.
Option C - Rebate Program for Commercial/Residential Who have Oustanding Special Assessment Obligations.
• Cost Estimate: $70,000
• We anticipate additional staff or consulting fees to manage the program in the amount of about $5,000-10,000 annually at least to start. It eventually will be phased out.
Option D - Rebate Program for Residential Who have Oustanding Special Assessment Obligations.
• Cost Estimate: $50,000
• We anticipate additional staff or consulting fees to manage the program in the amount of about $5,000-10,000 annually at least to start. It eventually will be phased out.
Option E - Do not offer any rebate program
Financial Impacts:
See summary of financial impacts in the alternative option summary section.
Tentative Timelines:
November 10th - Review of Franchise Fee Rebate Program
November 17th - Consider Approval of Franchise Fee Rebate Program
* Staff recommends acting on the rebate program if, or when, the Franchise fee ordinances for gas and electric are acted on.