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ARDEN HILLS SPECIAL CITY COUNCIL WORK SESSION — SEPTEMBER 23, 2024 2 and dedicating the fee for a specific purpose. Based on survey results and additional discussions, Council was in favor of implementing electric franchise fees to offset debt service for the new fire station in 2025. Finance Director Yang said at the August 191h budget work session, Council directed Staff to work with the City's Financial Advisor, Ehlers, to determine the timing and structure of a bond issuance to occur in the spring of 2025. This would align with the anticipated development of the new fire station. She pointed to Attachment A in the agenda packet, which is the preliminary series 2025 General Obligation Capital Improvement Plan bond schedules. This includes one scenario at bank qualified rates and another with a 75 basis points for cushion. The scenarios assume the bonds would settle on May 15, 2025, with maturity dates of 10, 15 or 20 years. Finance Director Yang asked for direction on what term or debt service schedule Council would like to adopt. This decision will inform the targeted revenue structure. Finance Director Yang pointed to Attachment B in the agenda packet, which contains three Electric Franchise Fee rate options. Those scenarios assume a $375,000 revenue target. This is the amount in the 2025 Preliminary Budget. Residential properties will be assessed a $3.00 monthly fee and the amount varies slightly for other property types. Finance Director Yang said with the first debt payment expected in February of 2026, Staff recommends adoption of ordinances and rate structure no later than November 1 for implementation by February 1 of next year. Staff confirmed with the City Attorney that a public hearing for adoption of the ordinance is not required. The City can choose to hold a public hearing, if they so choose. Finance Director Yang introduced Mike Wilhelmi from Xcel Energy who stood for questions regarding implementation of rate structure or the program specifics. Mayor Grant said Council should discuss the bonding first. Councilmember Holden wanted to verify that the franchise fees have been in the newsletter twice, there was an open house, as well. So it has been advertised. Finance Director Yang confirmed. Mayor Grant wanted to clarify something from the packet. There were 73 residential survey responses. The 54% was a combination of electric only, gas and electric. Finance Director Yang confirmed. Mayor Grant said there was an additional 17% who chose a hybrid of both. He said at a subsequent council meeting it was discussed that the franchise fees would be used for the fire station, only. He asked Council's opinion on the various debt maturity levels. Mayor Grant asked how much of a financial commitment Arden Hills has in the new fire station. He thought there was a potential $3 million bonding from the feds.