by Tammy Sakry
With many of Ramsey’s roads approaching their 40th anniversary, the city is trying to figure out how to pay to reconstruct the deteriorating streets.
Approximately half the city’s roads were built between 1975 and 1985 and the roads will need to be reconstructed, said Public Works Director Brian Olson.
But the Ramsey City Council was not ready to commit to a franchise fee or other funding source for road improvements at its Feb. 14 meeting.
Mayor Bob Ramsey said before he would consider a franchise fee, which plainly is another tax, he wants to pursue other funding options first.
This is different than a tax as the county and school district would get a share of that, said Councilmember Jeff Wise.
Using a franchise fee would ensure everyone is paying an equal amount, he said.
According to Olson, residents would be paying $14 per month franchise fee on their gas and electric bills, totaling $28 per month, if the council approved the proposed fee.
Everybody with electric and gas services would pay the franchise fee for the road repair, not just homeowners and businesses, Wise said.
It would not impact property owners with undeveloped land, which generates zero road use, he said.
“The assessment process is archaic and a nightmare,” said Councilmember Randy Backous.
The current assessment system bases the amount property owners pay on the property’s frontage on the roads and the city only assesses for overlays, Olson said.
The proposed franchise fee would replace the assessments for road maintenance work, except reconstruction, he said.
Fifty percent of the road reconstruction costs would still be paid by benefiting property owners, Olson said.
The city will soon have to start rebuild three miles of roads per year that are 40 years old or older, he said.
A franchise fee “…would pull everyone into the equation equally. We all use the roads,” Backous said.
Hopefully, the city can reduce or eliminate the assessment, he said.
Councilmember Jason Tossey said he does not want to box the city into using a franchise fee or to a franchise fee amount at this point.
While the proposed franchise fee would be the fairest option, the city needs to keep the assessment policy for now and look at other funding options for future road improvements, he said.
The franchise fee may not keep up with the project costs, but he would support a fee over increasing the levy, Tossey said.
“There is not a perfect way to fund this,” said Councilmember Sarah Strommen.
Using a franchise fee is balanced and it will provide the city with some flexibility, she said.
“If we keep looking for the perfect solution, we won’t find it,” Strommen said. “We have a bill (for road reconstruction) coming due and we have to pay it.”
The council can also eliminate the franchise fee in the future, she said.
If the city uses a franchise fee, it needs to get rid of the assessments, said Councilmember Colin McGlone.
Keeping the assessment policy allows the city to issue assessment bonds for larger projects, Olson said.
“If the city gets enough franchise funds built up, it should not need assessment bonds,” Backous said.
“We are going to have pay for the roads at some point,” he said.
If the council doesn’t want to charge a franchise fee, then residents will have pay assessments, he said.
The council needs to go back and discuss other ways of cutting the budget to make it “lean and mean” and then have this discussion, said Ramsey.
Councilmember David Elvig agreed the council needs to look at the budget; it appears the majority of the council agrees with the franchise piece.
The city needs to continue this initiative and create a policy as well as look at a variety of ways to fund future road improvement projects, he said.
The council still needs continue investigate budget option and get public input, Elvig said.
“There is no good choice, but we can’t keep kicking it down the road because eventually it will hit a pothole and fall in,” Wise said.
Tammy Sakry is at email@example.com