HomeMy WebLinkAbout7A, Resolution 2009-009 to receive special assignment roll for 2009 PMP
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Request for Council Action
Prepared By: Kristine Giga, Civil Engineer
Council Meeting Date: May 11, 2009
Motion to adopt resolution 2009-009: Receiving proposed special assessment roll and
providing for hearings for the 2009 Pavement Management Program
Budgeted Amount:
$2,065,000
Estimated Actual Amount:
$1,583,141.01
Funding Source:
PIR, Enterprise Funds,
Special Assessments
Recommendation:
1. Adopt resolution 2009-009: Receiving proposed special assessment roll and providing for
hearings for the 2009 Pavement Management Program.
Supporting Documents:
1. Memorandum from Civil Engineer Kristine Giga dated May 7, 2009.
2. Letter dated May 7, 2009 from City Attorney Jerry Filla
3. Resolution 2009-009
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MEMORANDUM
DATE:
May 7, 2009
TO:
Mayor and City Council
Ron Moorse, City Administrator
FROM:
Kristine Giga, Civil Engineer
SUBJECT:
2009 Pavement Management Program- Glenarden Neighborhood
. Receive assessment roll and order assessment hearing
BACKGROUND
A portion of the costs for the 2009 PMP project are proposed to be assessed to the benefiting
properties. In order to assess these costs, the City must follow the Public Hearing steps outlined
in State Statute 429. At the April 27, 2009, City Council meeting, the City Council adopted a
resolution declaring costs to be assessed and ordering the preparation of assessment rolls. The
next step is for the City Council to adopt a resolution receiving the proposed assessment roll and
setting a hearing date for the assessments. Public hearings are required in order to assess the cost
of public improvements.
DISCUSSION
The project is proposed to be assessed consistent with the City's assessment policy, which states
that 50% of the costs for roadway improvements will be assessed to residential properties, and
the remaining portion financed using various City funds.
At the April 27, 2009, City Council meeting, staffrequested direction from the City Council on
how to proceed with assessments on several parcels within the project.
1445 Forest Lane:
The City Council agreed with staffs recommendation to list this property as 1 REV, as it was
determined that without a registered survey, staff could not guarantee that the lot is large enough
to be subdivided into two lots that would meet the current City code.
3544 North Snelling Avenue, 1400 Forest Lane, 3438 Glenarden Court:
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These three parcels are large enough to be subdivided; however, the existing home would need to
be removed to do so. The property owners requested that their assessment for 2 REVs be
reevaluated. The City Council directed staff to research options for delaying the payment of the
assessment until such time that the property is subdivided. Attached is a letter from the City
Attorney with three options on how to address these parcels.
1433 Forest Lane:
This parcel could be subdivided without moving a structure. This property is listed as 2 REUs.
City parcels:
Freeway Park, which is identified as a tax-exempt equivalent unit (TEV), has been converted to
one REU based on the same subdividing criteria used to determine the residential lot units.
Lindy's Park was not included, as it is right-of-way and is not a delineated parcel. City Council
asked staff to determine how many lots this area could be if it were a delineated parcel. Staff
determined that Lindy's triangle would be the equivalent of two parcels that meet current City
code.
FINANCIAL IMPLICATIONS
Assessment rate
The total amount to be assessed is $ 594,152.22. The total project cost is $1,583,141.01; the
amount to be paid by the City is $988,988.79. The table below shows the cost per unit for three
scenanos:
a. Including no City parcels in the assessment roll
b. Including Freeway Park as 1 REU in the assessment roll
c. Including Freeway Park as 1 REU and Lindy's Park as 2 REU in the assessment roll
#REU Includes: Cost per unit
89 85 parcels, 4 of which are 2 REV; no City parcels $ 6,675.87
90 89 REU plus 1 REU- Freeway Park $ 6,601.69
92 89 REV plus 1 REU- Freeway Park, 2 REU- Lindy's $ 6,458.18
Interest rate
For the 2007 PMP, the City Council set an interest rate 6.5%, which was 2% over the annualized
rate of return (4.5%, May 2007).
The assessment policy states that the interest rate shall be set at prime plus two percent. Prime
rate is currently 3.25%; this would mean an interest rate of 5.25%. The current annualized rate
of return on the City's portfolio is 2.8%. If the City Council were to set the interest rate at 2%
over the annualized rate of return, the rate would be 4.8%.
Payment Period
In 2007, the City Council deviated from the assessment policy by extending the payment period
from 5 years to 7 years for the mill and overlay project. The standard payment period for a
2009 PMP
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reconstruction project is 10 years. The following table shows the annual assessment amount for
the three scenarios listed above at 10 and 15 year payment periods with 4.8% and 5.25% interest
rates.
Assessment Length of
amount payment Interest Annual Total Interest
#REU (per unit) (years) Rate payment Paid
89 $ 6,675.87 10 4.80% $ 856.18 $ 1,885.92
10 5.25% $ 875.08 $ 2,074.96
15 4.80% $ 634.50 $ 2,841.68
15 5.25% $ 654.08 $ 3,135.37
90 $ 6,601.69 10 4.80% $ 846.67 $ 1,864.96
10 5.25% $ 865.36 $ 2,051.91
15 4.80% $ 627.45 $ 2,810.10
15 5.25% $ 646.81 $ 3,100.53
92 $ 6,458.18 10 4.80% $ 828.26 $ 1,824.42
10 5.25% $ 846.55 $ 2,007.30
15 4.80% $ 613.81 $ 2,749.01
15 5.25% $ 632.75 $ 3,033.13
SCHEDULE
Assessment rolls must be adopted no later than September 28, 2009, to allow for a 30-day
pre-payment period. Following the pre-payment period, assessment rolls are certified to Ramsey
County for collection. The County requires that this certification be done by November 15 in
order to allow them enough time to add the assessments to property taxes. The City plans to
complete the certification by the end of October. As a result, we recommend the following
schedule for the 2009 assessment process:
May 11
Resolution receiving assessment rolls, setting hearing dates
May 20
Notice of hearing published in the Shoreview-Arden Hills Bulletin
May 20
Mail notices to affected property owners
June 8
Assessment hearing
June 8
Hearing date for final adoption of assessment roll
June 9 to July 8
Prepayment of assessments (30 days)
2009 PMP
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CONCLUSION
The number of parcels to be assessed, interest rate and length of payment must be set for this
resolution. Following the assessment hearing and prior to adoption of the assessment roll, the
City Council may choose to adjust the interest rate and length of payment. The City Council can
not increase the proposed amount to be assessed once the preliminary assessment roll is adopted,
per Chapter 429 of the State statute.
RECOMMENDED COUNCIL ACTION
Approval of Resolution 2009-009: Receiving proposed special assessment roll and providing for
hearings for the 2009 Pavement Management Program.
Warren E. Peterson
Jerome P. Filla
Daniel Witt Fram
Glenn A. Bergman
John Michael Miller
Michael T. Oberle
Steven H. Bruns.
Paul W. Fahning*
Sonja R. Ortiz
Amy K. L. Schmidt
Ben I. Rust
Jonathan R. Cuskey
Jared M. Goerlitz
P/&ERSCN,
FRAM BERGMAN
Suite 800
55 East Fifth Street
St. Paul. MN 55101-1718
(651) 291-8955
(651) 228-1753 facsimile
www.pfb-pa.com
PROFESSIONAL ASSOCIATION
(651)290-6907
jfi t I a(@ofb-oa.com
May 7, 2009
Kristine Giga
City Engineer
City of Arden Hills
1245 West Highway 96
Arden Hills, MN 55112
VIA EMAIL & U.S. MAIL
Re: 2009 PMP
Special Assessments
Our File No.: 10470.08-1
Kris:
According to the City's current policy, street improvements are specially assessed on
adjacent single family residential parcels on a per lot unit basis. Special
assessments on single family residential lots which are capable of further subdivision
can be addressed in a number of ways:
A. Pursuant to Minn. Stat. ~429.061, Subd. 2, the City could levy
special assessments for current and possible future lots at the same
time. If current dwelling units need to be moved to accommodate the
future subdivision, current property owners would argue, perhaps
successfully, that they will not realize special benefits from the
additional unit assessments until the future subdivision occurs.
B. Pursuant to Minn. Stat. 9429.061, Subd. 2, the City could assess one
unit now and adopt a deferred assessment roll for future lots. A future
subdivision of the property would trigger the payment of the deferred
assessments. However, all deferred assessments must be paid within
thirty (30) years of the date of adoption of the deferred assessment
roll even if the subdivision has not occurred within that time.
.ALSO ADMITTED IN WISCONSIN
Kristi ne Giga
May 7, 2009
Page 2
c. Pursuant to Minn. Stat. 9429.071, Subd. 1, the City could adopt a
supplemental assessment roll when the subdivision of the property
occurs. The City would need to follow all of the process that it does
when it adopts a normal assessment roll but, only those people who
would be receiving a supplemental assessment would need to be
notifi ed .
If option A or B is followed, the assessment resolutions would be recorded and
would provide notice to future property owners of existing assessments. If option C
is followed, a future property owner would not know that there is a "pending
assessment" when the purchase agreement is signed for the newly created lot. Lots
on which special assessments are deferred or on which the City anticipates adopting
a supplemental assessment roll should somehow be flagged in the City's records so
that future staff and council members realize that there are special assessments to be
collected, and so that this issue could be raised at the time of the application for the
subdivision.
If you have any questions, please contact me.
JPF/jmt
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CITY OF ARDEN HILLS
COUNTY OF RAMSEY
STATE OF MINNESOTA
RESOLUTION NO. 2009-009
RESOLUTION RECEIVING PROPOSED SPECIAL ASSESSMENT ROLL AND
PROVIDING FOR HEARINGS FOR THE 2009 PAVEMENT MANAGEMENT
PROGRAM
WHEREAS, by a resolution passed by the council on April 27, 2009, the City
Administrator was directed to prepare a proposed assessment of the cost for the City of
Arden Hills 2009 Pavement Management Program improvement of the following streets:
Arden Place, from Old Snelling to Glenarden Road,
Glenarden Court, from Skiles Lane to Glenarden Road,
Glenarden Road, from Old Snelling to cul-de-sac,
Forest Lane, from Old Snelling to Glenarden Road,
Skiles Lane, from Old Snelling to Glenarden Road,
Snelling Avenue N, from Arden Place to cul-de-sac,
WHEREAS, the City Administrator has notified the council that such proposed
assessment has been completed and filed in his office for public inspection,
NOW, THEREFORE, BE IT RESOLVED by the Mayor and the City Council that:
1. A hearing shall be held at 7:00 p.m. on the 8th day of June, 2009 in the city hall at 1245
West Highway 96, to pass upon such proposed assessment. All persons owning property
affected by such improvement will be given an opportunity to be heard with reference to
such assessment.
2. The City Administrator is hereby directed to cause a notice of the hearing on the proposed
assessment to be published once in the official newspaper at least two weeks prior to the
hearing, and he shall state in the notice the total cost of the improvement. He shall also cause
mailed notice to be given to the owner of each parcel described in the assessment roll not less
than two weeks prior to the hearing.
3. The owner of any property so assessed may, at any time prior to certification of the
assessment to the county auditor, pay the whole of the assessment on such property, with
interest accrued to the date of payment, to the City Administrator, except that no interest
shall be charged if the entire assessment is paid within 30 days from the adoption of the
assessment. An owner may at any time thereafter, pay to the County the entire amount of the
assessment remaining unpaid, with interest accrued to December 31 of the year in which
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Stanley D. Harpstead, Mayor
such payment is made. Such payment must be made before November 15 or interest will be
charged through December 31 of the succeeding year.
ADOPTED BY THE CITY COUNCIL OF THE CITY OF ARDEN HILLS
THIS 11th DAY OF MAY, 2009.
ATTEST:
Ronald J. Moorse, Administrator
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