Kasson Council rejects proposed special assessment reductions

Kasson’s City Council discussed proposed special assessment reductions for the southwest reconstruction project on March 12 and ultimately rejected the reduction but did approve looking into changing city policy to reduce interest rates.
Previous discussions had led to a proposed 30% assessment on the property owners affected by the improvements. This amounts to $9,030 per residential unit (RU).
Councilman Paul Johnson felt that the assessment was too high and put an undue burden on select citizens rather than sharing the cost more evenly. He suggested phasing back the assessment amounts to make them more financially manageable.
Johnson proposed lowering the assessment to 25% for this project, saving property owners around $1500 per RU. This would also represent a saving of $25 per month for those who chose to finance the assessment under previously used finance terms. Johnson’s idea was opposed by the rest of the council with Mayor Dan Eggler, Councilmember Mel Ferris, and Councilmember Ryan Christensen sharing concerns about the extra cost to the other taxpayers of Kasson.
Eggler felt it was unfair to have assessed citizens previously for improvements and then ask them to share the burden of projects that did not directly affect them. Ferris agreed shifting the 5% to the general populace was like asking those who were most burdened by assessments (those who were still paying assessments from previous projects) to pay more. Johnson suggested using existing stabilization funds to pay for the decrease and not pass those costs on to the current tax levy.
City Administrator Tim Ibisch pointed out that utilizing special assessments makes bonding easier. He also brought up adjusting the interest rate calculation for those seeking to finance their assessment through the city. Previously the city has charged the prime rate plus 1.5%. Ibisch suggested the possibility of changing that to the bond rate plus 1.5% which would save significantly on financing costs.
Ferris moved that staff should look into changing the policy to reduce interest rates. Johnson seconded the motion and it passed with unanimously.
Johnson then moved to reduce the assessment from 30% to 25%. This motion did not receive a second and therefore failed.A public hearing on the assessment is scheduled for March 26 at 6 p.m.