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. Cities say MnJDOT neglecting right-of-way maintenance Anne Finn . The League has learned that a number of cities have noticed a decline in right-of-way maimenance along trunk highways within city limits. Responsibility [or this maintenance rests with the Minnesota Depart . ment ofTransportation (Mn/DOT). Specifically, cities say Mn/DOT has reduced the frequency or mov,ring, collection of litter, abatement of noxious weeds, and repair of (ences and guardrails. In discussions with Mn/DOT, the League has requested information about the department's guidelines and has asked if cities can seek responses to individual concerns. The League will make this information available to cities once it arrives. A department representative encouraged cities to work directly with Mn/DOT district engineers when issues arise. Mn/DOT also suggested that, when possible, cities should seek "partnerships" with Mn/DOT to accomplish right-of...way maintenance. This League's Board ofDirccrors was briefed on this issue at the November Board meeting. League staff aho provided a draft of a pohcy position the League could use to work toward a legislative solution to the problem. The draft policy would require Mn/DOT to meet local maintenance standards or to reimburse cities for performing right-of-vvay maintenance. The Board reacted positively to the draft policy. However, since members did not have an opportu- nity to discuss the issue during tbe policy adoption process, the Board tabled the issue until its next meeting to allow for member input. Member input requested Staff is interested in hearing from members on this issue. If your city has had disputes with Mn/DOT over right-of-way maintenance or has worked successtlllly with the department to develop an agreement on maintenance of trunk highway right- of-way, please let us know. If you would like to aL'io share thoughts about what a policy should or should not include, we welcome your comments. Please direct information and comments to Anne Finn, LMC, at :lfinn@lmnc.org or (651) 281-1263... . Page 10 Builders contest municipal building fees TOm Gnmdhor;fer mid Laura Offerdahl In recent weeks, Twin Cities' newspapers have published several articles discussing municipal building permit fee practices. The articles were precipitated by a lawsuit brought :against the city of Shako pee by the Builders Association o[Minnesota and the Builders Association of the Twin Cities. In their lawsuit, the builders are challenging both the amount of fees collected by the city, and how the city accounts for and uses this revenue. This legal challenge may be the first of several lawsuits brought against cities in !v1innesota.According to:a Nov. 18, 2004, 51. Paul Pioneer Press artide,.the builders have "amassed a $750,000 war chest to wage the batdes." Recent devc-lopments have affected bow cities should look at building permit fees. The most significant change took place in 2003 when the state adopted a new State Building Code. Unlike previous. versions of the State Build~ing Code, tbe 2003 code did not include a recommended fee schedule. Instead, the code contained language requiring that fces be "fair, reasonable, and proportionate to the actual cost of the service for which the fee is imposed." While fce schedules hased OIl building valuation arc still conunon among cities, they do not negate the need to demonstrate that fees are "fair, reasonable, and proportionate to the actual cost" of the service being provided. To justifY fees, cities should look closely at the actual costs associated with administering their building code- enforcement program. The :accurate detennination of actual costs of service involves consideration of a variety of cost-related factors, and may require analysis by accounting or financial professionals. While the primary goal of this analysis is to ensure that fees are not excessive, cities should also be aware that such analysis might reveal that existing fees do not tUlly retIect the actual costs of services rendered. When evaluating fees, cities should consider how much revenue would be generated as a result of existing fees being applied to projects of increasing valuation. Cities should then compare anticipated fee revenue to their costs and adjust fees either up or down to ensure that the revenue derived is reason- able in light of the city's costs. The State Building Code does not require mathematical precision, but a city should be able to demonstrate some reasonable relationship between the fees charged and the cost of code enforcement. In light of recent code change:>; and the interest that these issues are now generating, it may be prudent for cities to review the legal requirements for establishing buiJding permit fees and to evaluate current fees with respect to those rcguirements. If you have guestions about these legal requirements, please contact Ton1. Grundhoefer, LMC, at (651) 281-1266 or tgrundho@lnmc.org;orLaura Offerdahl, LMC, at (651) 281- 1260 or lofferdahl@lmnc.org, .. lMC Cities Bulletin