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AGENDA ITEM — 3A <br />-fiR)LEN_,HILLs <br />MEMORANDUM <br />DATE: September 23, 2024 <br />Honorable Mayor and City Councilmembers <br />TO: Jessica Jagoe, Interim City Administrator <br />FROM: Joua Yang, Finance Director <br />SUBJECT: Preliminary 2025 General Obligation CIP Bond Schedules <br />Electric Franchise Fee Rate Structure Scenarios <br />Budgeted Amount: Actual Amount: Funding Source: <br />N/A N/A N/A <br />Council Should Consider <br />Provide feedback on the Preliminary 2025 General Obligation Capital Improvement Plan <br />(CIP) Bond Schedules <br />Provide feedback on the implementation of Electric Franchise Fees <br />Background <br />Staff held a Capital Funding Update Open House on Saturday, April 20th at City Hall. Staff <br />shared that there is an anticipated future gap in funding for the City, largely due to increased costs <br />for the Lake Johanna Fire Department Station project ($4.1M), the Old Hwy 10 Trail/Lake <br />Valentine to Hwy 96 and Lake Johanna trail projects ($3.6M), and a recently revised equipment <br />needs schedule. A survey was released, thereafter, for City residents and businesses to provide <br />additional input. <br />During the May 13, 2024 Work Session, staff shared the survey results. There were 73 residential <br />survey responses, with approximately 54% choosing a franchise fee option (22% - electric only; <br />32% - gas and electric), approximately 30% choosing a property tax levy option, and <br />approximately 17% choosing the combination of property tax levy and franchise fee option. For <br />those respondents who chose any combination of a franchise fee option, approximately 64% <br />indicated the City should consider dedicating the fees for a specific purpose. Some common <br />themes included bike lanes, park and trail improvements; structures and road maintenance; storm <br />water system maintenance and utility infrastructure; fire station. Respondents also provided their <br />concerns and additional comments for Council consideration. Some common concerns shared is <br />that an increase to property taxes would burden taxpayers and would remain in effect indefinitely. <br />Additionally, some respondents shared that non -profits should be assessed a fee in lieu of taxes, <br />which would mean assessing a levy increase on residents and imposing a franchise fee on non- <br />residential and non-profit organizations. <br />Page 1 of 2 <br />