OPINION

MOORE, Justice.

This case involves the construction and financing of capital improvements in the Highlands subdivision of the City of Ketchikan. Following construction, the Ketchikan City Council levied a special assessment against the land which benefitted from the improvements. The subdivision lot owners appeal the amount of the assessment and the interest rate charged during the payment period. The lot owners raise due process and estoppel issues, among others, in their attack on the Ketchikan City Council's financing decision.

I.

In 1978, Charles and Mary Hoyt decided to subdivide a parcel of land in Ketchikan into thirty-two lots. They petitioned the Ketchikan City Council to create a local improvement district ("LID") encompassing the proposed subdivision. LIDs are vehicles by which private landowners may benefit from advantageous financing methods available to cities, such as tax free municipal bonds. The Hoyts asked the Council to provide LID financing for capital improvements including road, water, sewer, telephone, and power line installation.

Following a public hearing at which no objections were raised, the Council created the Highlands LID for the Hoyts' property. When the LID was created, the Council, developer, and city staff all contemplated that construction would be financed by the issuance of bonds. At that time, the maximum legal interest rate for LID bonds was eight percent. Former Ketchikan Municipal Code [hereinafter KMC] 03.16.130.

In May 1979, the Council amended the Highlands LID. Although it continued to authorize the issuance of bonds, the amendment also permitted interim construction financing through such short-term obligations as would be approved by the Council. Construction commenced with interim financing from the Ketchikan General Fund.

During 1980, it became clear that municipal bonds could not be marketed at eight percent due to an unprecedented rise in interest rates. In December 1980, the Council amended KMC 3.16.130 to remove the cap on special assessment bond interest rates.

The capital improvements were substantially completed and inspected in October 1980, although work was not fully completed until August 1981. Until December 1980, the funds borrowed from the Ketchikan General Fund accrued interest at eight percent. Between December 1980 and January 1982, the funds accrued interest at eleven percent. In December 1981, the Council approved the final assessment roll which assessed total accrued construction, interest, and administrative expenses of $968,468.16 against the lot owners. The Council proposed that the lot owners pay the assessment over ten years at thirteen percent interest.

At a public hearing on the assessment on January 22, 1982, the lot owners objected to the amount of the assessment, the proposed thirteen percent interest rate, and the length of the repayment period. The Council passed a motion retaining the amount and the thirteen percent interest rate, but extended the repayment period from ten to fifteen years. The Council reaffirmed this decision in February 1982.

Certain lot owners identifying themselves as the Property Owners Association of the Highlands Subdivision appealed the assessment amount and repayment terms to the superior court. The owners moved for a trial de novo and shortly thereafter submitted the affidavit of real estate broker Charles Elliott.

The superior court ordered the Elliott affidavit stricken from the record as untimely and later denied the motion for a trial de novo. Following briefing and oral argument, the court affirmed the decision of the Council and entered final judgment. This appeal followed.

II.

A municipality may create a LID to help property owners finance capital improvements. AS 29.46 (formerly AS 29.63). Ketchikan implemented its delegated authority in chapters 3.16 and 3.18 of the Ketchikan Municipal Code. A LID involves an agreement by the Council to pay interim construction costs. KMC 3.16.110. The Council may finance construction by issuing warrants or bonds, or by transferring funds from the city general fund. Id.; KMC 3.16.120(a). Once the project is complete and the total costs known, the Council levies a special assessment against the property benefitted by the improvements. The owners are entitled to notice of the proceedings and may object to the assessment roll or any separate assessment during the public hearing. KMC 3.18.060. After the assessment roll is completed, the Council establishes a repayment schedule and interest rate. KMC 3.18.070.

III.

The lot owners argue that they were deprived of due process of law because the levy of special assessments is an adjudicative function and they were not afforded trial-like procedures. Ketchikan argues that trial-like procedures were not required because the Council acted in its legislative capacity.

This is a question of law upon which we exercise our independent judgment. Langdon v. Champion, 752 P.2d 999, 1001 (Alaska 1988). We review the decision of the Council directly because the superior court was acting as an intermediate court of appeals. Barcott v. State, Dep't. of Pub. Safety, 741 P.2d 226, 228 (Alaska 1987); City of Nome v. Catholic Bishop, 707 P.2d 870, 875 (Alaska 1985).

The question whether a governmental action is "legislative" or "adjudicatory" implicates important due process considerations. Where an act is deemed to be legislative, trial-type procedures need not be afforded to affected members of the public. The contrary is true where an act is deemed to be "adjudicatory." See 2 K. Davis, Administrative Law Treatise § 12:1, at 406-09 (2d ed. 1979) (citing Londoner v. City of Denver, 210 U.S. 373, 386, 28 S.Ct. 708, 714, 52 L.Ed. 1103 (1908); I.C.C. v. Louisville Nash. R.R., 227 U.S. 88, 91-92, 33 S.Ct. 185, 186-87, 57 L.Ed. 431 (1913)).

Assessment proceedings which affect individual taxpayers, rather than taxpayers as a group, and which involve the ascertainment of facts material to those individuals are "adjudicatory." The requirement that an individual specifically targeted by a taxing authority be afforded a hearing has been interpreted to entitle the taxed party to trial-type procedures where disputed material facts must be ascertained. 2 K. Davis, supra p. 9, § 12:1, at 407.

The Council's decision in this case involved two components. First, the council decided how and at what interest rate it was going to fund the subdivision's improvements. This clearly involved a policy determination which is "legislative." The legislative character of the decision is evidenced by the fact that the Council did not sift through and decide evidentiary questions unique to any of the affected parties. See Greene v. McElroy, 360 U.S. 474, 496-97, 79 S.Ct. 1400, 1413-14, 3 L.Ed.2d 1377 (1959) (where government action seriously invades individual interest and requires findings of fact, trial-type procedures are required).

A more difficult question is whether the Council's decision to charge the taxpayers for delays caused by work allegedly benefitting only the city was "legislative" or "adjudicative." The Council based its decision to charge the taxpayers for these delays on testimony that the work which caused the delays benefitted the taxpayers as well as the city.

We believe that this was a legislative decision because the decision affected a large development and a group of similarly situated taxpayers. To hold otherwise would encroach upon and make too cumbersome the legislative policy-making function.

In a legislative assessment proceeding, due process requires notice and an opportunity to be heard, both of which were provided to the affected owners in this case. See, e.g., Hinz v. City of Phoenix, 118 Ariz. 161, 575 P.2d 360, 363 (App. 1978); South Ferry St. Project v. City of Schenectady, 72 Misc.2d 134, 338 N.Y.S.2d 730, 733-34 (Sup.Ct. 1972); Tramel v. City of Dallas, 560 S.W.2d 426, 429-30 (Tex.Civ.App. 1977). Because the lot owners received all the process due, we conclude that the superior court did not abuse its discretion in refusing to conduct a trial de novo. See State v. Lundgren Pac. Constr. Co., 603 P.2d 889, 895-96 (Alaska 1979); see also Alaska Appellate Rule 609.

IV.

The owners asserted that the changes which delayed completion of the project until August 1981 were undertaken at the behest of and for the exclusive benefit of the city. City staff members, however, indicated that the rerouting of one water line, which delayed the project until the spring of 1981, was required to remain eligible for grants from the Alaska Department of Environmental Conservation. The installation of overhead power and telephone lines by Ketchikan Public Utility, which was not completed until January 1981, was done at the request of the Hoyts and saved the project at least $60,000. Finally, replacement of one old wood stave water main, while beneficial to the city, also facilitated the project's hookup to another water main.

Our review of a council's legislative assessment decisions is very limited. The Council's decision is presumed correct. City of Wasilla v. Wilsonoff, 698 P.2d 656, 657 (Alaska 1985). We will reverse only upon a showing "of fraud or conduct so arbitrary as to be the equivalent of fraud, or so manifestly arbitrary and unreasonable as to be palpably unjust and oppressive." Id. at 658 (quoting Kissane v. City of Anchorage, 159 F. Supp. 733, 737 (D. Alaska 1958)). The complaining party bears the burden of proving the arbitrariness and injustice of the determination by producing competent evidence not "based on mere conjecture," including "objective documentation to support [their] assertions." Wilsonoff, 698 P.2d at 658.

The owners have not introduced competent evidence rebutting the presumption of correctness to which the council's determination is entitled. There was conflicting testimony at the hearing about who benefitted from the various improvements. The owners have not met their burden of proving fraud or manifest arbitrariness and unreasonableness.

V.

The lot owners argue that the Council should be estopped from charging more than eight percent interest on the deferred assessment installments.

Estoppel may be asserted against a public agency. Municipality of Anchorage v. Schneider, 685 P.2d 94, 97 (Alaska 1984) (building permit issued in violation of zoning ordinance; municipality estopped); Jackson v. Kenai Peninsula Borough, 733 P.2d 1038, 1040 (Alaska 1987) (same; city not estopped). The elements of equitable estoppel are:

(1) assertion of a position by conduct or word, (2) reasonable reliance thereon, and (3) resulting prejudice. A fourth element . . . is that the estoppel will be enforced only to the extent that justice so requires. . . . [T]his factor should play an important role when considering estoppel against a municipality. Often, even where reliance has been foreseeable, reasonable, and substantial, the interest of justice may not be served by the application of estoppel because the public interest would be significantly prejudiced.

Schneider, 685 P.2d at 97 (citations omitted); see also City of Long Beach v. Mansell, 3 Cal.3d 462, 91 Cal.Rptr. 23, 48, 476 P.2d 423, 448 (1970) (Estoppel against the government is appropriate only where "the injustice which would result from a failure to uphold an estoppel is of sufficient dimension to justify any effect upon public interest or policy which would result from the raising of an estoppel.").

Elliott stated that Ketchikan Finance Director Al Learned assured him in October 1978 that the interest rate would be eight percent. Even if Learned made the alleged assurance to Elliott, we have little difficulty in concluding that this does not estop Ketchikan. Elliott and Elberson appear to be sophisticated businessmen. We are thus not moved by the concerns we expressed in Schneider, 685 P.2d at 96-97, which involved an average citizen's good faith reliance upon an erroneously issued building permit. Northway advertised a payment term of fifteen years at eight percent interest. Some purchasers, including Mr. Enger, assumed this was a binding promise by the city. But Elliott does not allege that Learned promised a fifteen year term. Further, the advertisement does not mention that purchasers probably would have to refinance the lien with private lenders in order to get a construction loan. It is thus apparent that any statement Learned made to Elliott could easily have been distorted by Elliott and Elberson's "salesmanship" before reaching the lot owners' ears.

The city could not have promised any terms of payment at the time of the advertisement because they were not yet set. KMC 3.18.070 provides that the city council shall set rates and repayment schedules for assessments after the final assessment roll is completed. This is not "an unsettled area of law" as in Tetlin Native Corp. v. State, 759 P.2d 528, 535 (Alaska 1988), where we found that the imposition of estoppel was necessary to prevent an unjust result.

The present case also is not analogous to City of Kenai v. Filler, 566 P.2d 670, 676 (Alaska 1977), where the city accepted the benefits of a contract and then sought to be released from the contract for its failure to comply with its own ordinances. Ketchikan has not accepted the benefit of any contract. Not only was there no contract here, but the benefit of the project has flowed almost entirely to the developer and the owners of the improved lots themselves. The benefit to Ketchikan from an increased tax base pales in comparison and lies largely in the future.

The owners' estoppel claim thus must depend on the ordinances which provided that bonds would be issued to finance the improvements. The owners' argument here is best summarized by Enger's statement at the January 22 hearing that the owners were willing to pay all of the costs of improvements, "but only . . . at the interest rate set by law at the time these improvements were contractually required to be completed."

The Council never asserted that bonds would be issued at eight percent. The Ketchikan Municipal Code did limit such bonds to eight percent at the time of LID formation, at the time originally scheduled for completion, and at the time of substantial completion. However, the cap was removed by the time the project was fully completed, and that was the time that the assessment was made.

We believe that the only reasonable interpretation of the interest rate cap provision is that it applied only to those bonds issued, rather than authorized, when it was in effect. The rate cap provision dealt exclusively with the requirements for issuance of bonds and was inapplicable to any bonds other than those presently being issued pursuant to its terms. See former KMC 3.16.130, quoted in supra note 3.

The owners' argument reduces to the contention that the owners only should have to pay eight percent on their assessments while the taxpayers of Ketchikan subsidize the difference between eight percent and the market interest rate or the rate of any bonds issued. The record, however, is full of statements by council members that the city had no intention of subsidizing the owners of the benefitted lots. Moreover, the council refrained from issuing bonds in order to pass on to the owners the benefit of any future decreases in market interest rates.

The fourth element of estoppel allows enforcement only to the extent justice requires. Because of the importance of this element in cases against the government, we are not inclined to find estoppel at all. It would be unjust to force the population at large to subsidize the purchasers of Ketchikan's "most exclusive" lots as a result of an ambiguous assertion by a city council which had repeatedly expressed the opposite intent. See generally Earthmovers of Fairbanks v. State, Dept. of Transp. and Pub. Facilities, 765 P.2d 1360, 1370-71 (Alaska 1988). We thus find no merit in the estoppel claim.

VI.

The owners argue that by raising the interest rate cap on bonds, the council caused an increase of more than twenty percent in the project's costs. This, it is urged, required notice to the owners and an opportunity to object pursuant to KMC 3.16.110(d).

The code provision in question refers to "contract cost plus all other costs of improvement," but we do not think this reasonably can be construed to include interim or post-construction finance expenses. The relevant paragraph refers to "Construction by Contractor," not financing. The lot owners' contention that the rise in rates caused costs to rise by twenty percent is based on a comparison of the costs of eight percent financing and thirteen percent financing and the assumption that every owner will finance the entire balance over fifteen years. This argument lacks merit. Not only are most owners likely to pay off their assessments prior to building on their lots, but the determination of the payment schedule is clearly allocated to the Council after completion of the project. We believe the statute was intended to be limited to actual and projected costs of construction, which are capable of fairly precise quantification. Subjecting the LID process to interruption on the basis of something as mercurial as market interest rates would prevent homeowners, contractors, and the city from being able to plan ahead with any reasonable degree of certainty. Moreover, the interpretation urged by the lot owners would place on the Council the risk that interest rates will rise during the course of construction. Once interest rates reached a point where total cost estimates increase by twenty percent, the owners might compel the Council to terminate the project and bear the total expense of the uncompleted improvements.

We thus conclude that KMC 3.16.110(d) was not triggered by the council's decision to remove the cap on bond interest or its decision after completion of the project to charge thirteen percent interest on deferred assessments.

The judgment of the superior court is AFFIRMED.