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Annexation update: attorneys recommend first-right clause; resort tax could cover part of fire-district costs
Summary
Staff reported contract edits for annexation to Rural Fire District No. 7 and said attorneys recommend a clause giving the city first review on disposal rather than requiring city ownership. The fire district plans to use 10% of resort tax receipts toward ongoing costs; a final agreement will be returned for approval.
Committee members received an update on the proposed annexation to Rural Fire District No. 7. Staff said the attorneys proposed contractual edits that preserve the city’s protections while avoiding a requirement that the city own assets outright; instead, the recommended language would give the city a first right to review if the district disposes of an asset.
"They are telling us, yes, we are still good to go," a staff member said, describing the attorney review process. Staff cautioned a new agreement is not yet complete and that a separate council action will be required to approve the final agreement once edits and counsel sign-off are finished.
Members discussed funding assumptions: the fire district is converting its levy from a millage to a dollar-based assessment and intends to use resort-tax dollars for a portion of its costs. Staff confirmed the assumed resort-tax share is 10% and explained that percentage is calculated on the previous year’s receipts. "It's 10%, and it's calculated on the previous years," staff said, clarifying the funding model.
Next steps: staff will finalize contract edits with counsel, prepare a draft agreement and bring a formal approval item to council in a future meeting, and include the resort-tax allocation in forthcoming budget work.
