CCP 09-10-2001 - Laserfiche WebLink

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I I f I I I I I I .. I I I I I I I , I 9.7.01 The major categories of funding sources are I) Ad Valorem Taxes 2) Special Assessments 3) Development Charges [Building Permits, Land Development Fees and Land Exaction] 4) Grants. The City does have a storm water utility inplace. Following is a description and financing principles used with each of these financing mechanisms. Table 3 illustrates the advantages and disadvantages of the different financing methods. Ad Valorem Tax General taxation is the most common revenue source used to finance government services including minor maintenance measures for drainage and water quality facilities. Using property tax has the effect of spreading the cost over the entire tax base of a community. A special tax district can also be used to raise revenue. The special tax district is similar to the administrative structure under general taxation except that all or part of the community may be placed in the tax district. The principle is to better correlate improvement costs to benefitted or contributing properties. Special Assessments Municipalities are familiar with the use of special assessments to fmance special services from maintenance to construction of capital improvements. The assessments are levied against properties benefiting from the special services. The philosophy of this method is that the benefitted properties pay in relation to benefits received. The benefit is the increase in the market value of the properties. Development Charges Fees charged to new development which generate runoff can be charged to finance infrastructure needed to serve the development. This is a useful tool in communities that are rapidly developing. City of Arden Hills, Minnesota Local Water Resource Management Plan A-ARDEN0101.00 Page 35