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� �. J�Y��.tJE�I!l,.J <br />.�Ir� <br />Memo <br />To: Mayor and Council, <br />Neal Beets, City Manager <br />FrOm: Chris Miller, Finance Directo � <br />Date: May 2, 2002 <br />Re: Issues and Impacts Regarding Potential Revisions to the Special Assessment Policy <br />Introduction <br />The attached information is provided to address the issues and impacts regarding potential <br />revisions to the special assessment policy. The information includes discussion items with <br />regard to: reducing or eliminating assessments in general, reducing or eliminating assessments <br />on particular property types, and other related issues. The information is presented to facilitate <br />discussion of the issues, and is not intended to be a recommendation of any kind. <br />Reductions or Elimination of Special Assessments <br />Reducing or eliminating assessments could potentially: <br />. Shift the project cost burden from the project area to the City as a whole. <br />. Shift the project cost burden to taxes. <br />. Place infrastructure improvements in direct competition with other programs and services <br />for limited tax dollars. <br />. Require bond financing and consequently increasing the cost of the project. <br />. Negatively impact the City's bond rating. <br />Reducing or eliminating assessments will likely shift the project cost burden from the project <br />area to the City as a whole. This approach will lessen the significance of localized benefit, in <br />favor of community-wide benefit. In addition, any reduction or elimination of special <br />assessments will require the use of other funding sources to pay for construction projects. <br />Although a number of potential sources e�st, each is either legally restricted, or is dedicated by <br />policy or practice for specific purposes (see `Other Financing Sources' section below far more <br />information). Tapping those revenue streams will reduce the amount available for other <br />programs or services. <br />Given the structural funding requirements of the City's infrastructure replacement and <br />maintenance programs, additional taxes may be the only viable long-term funding source to <br />offset a reduction of assessment revenues. However, increasing our reliance on taxes for <br />construction projects places infrastructure improvements in direct competition with other <br />programs and services for limited tax dollars. <br />Attachment B <br />-1- <br />