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ARDEN HILLS SPECIAL CITY COUNCIL WORK SESSION — OCTOBER 14, 2024 4 Mayor Grant is concerned that we don't know what the fire department vision is going to cost. He thinks we'd be best off to make sure we are covered. He thinks Option A-3 is not out of the question. His second choice would be Option A-2. The fire station is estimated at $24 million. He looked at what the residential monthly impact is around $3.00 but if it was a property tax it would be $9.00. If we come up short, we'll have to go back and levy the amount equal to three times the amount of what you could have received had we scaled it up now. Councilmember Holden asked if he wanted to make sure we're covered because we don't know what the cost is. We can use the money to pay it early. Mayor Grant said according to Ehlers, we can refinance, but we're limited to 10-years. He stated the options are a little unclear. He said the options become really constrained, if the entire amount is not covered. He noted the cost is not going to go down, but it can go up. Councilmember Monson said the Fire Board believes it is between $20-$25 million. This is an estimate with the information we have. Mayor Grant said Option 3 at $542,000 seems to be too much. He would like to see an option somewhere between the $395,000 and $542,000. He remembers discussion where $3.86 would be $455,000. He thinks that seems to cover all options. Councilmember Rousseau asked if $50,000 equals about 1% levy increase. Finance Director Yang confirmed. Councilmember Rousseau said if the cost to build this was a little more, and we needed to go up to $4.20 every month that would be a 1% levy increase next year. Finance Director Yang confirmed. Councilmember Monson would be open to getting more franchise fees than what is bonded for to help pay it off early and for the reasons Mayor Grant discussed. Especially if the wait is 10 years before it could be refinanced. She would be open to an amount between the $395,000 and $542,000. Mayor Grant asked Mike Wilhelmi if that is possible. Mike Wilhelmi confirmed. He didn't think that would be a problem. He asked the council if they had a more specific number to target. Councilmember Fabel is opposed to the franchise fee. He said the City needs money for the expenses it has coming up. Borrowing money makes sense for that. It is appropriate to adequately cover the risk of additional expense. Mayor Grant said this would be a 15-year at 75 basis points with AAA rating. Having it based on $420,000. Maybe we want to go with $430,000. That would assume the $24 million.