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Home My WebLink About2.b County Road 38 - TH 3 AssessmentCITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION City Council Work Session Date February 9, 2005 AGENDA ITEM. County Road 38 TH 3 to East Tract Line of Reflections, City Project #393 AGENDA SECTION: Discussion PREPARED BY Andrew J Brotzler, P. E City Enginar` AGED ATTACHMENTS: Letter from City Attorney APPROVED BY: NOTES: For Discussion Only ISSUE: Review and discuss the options available for recovering project costs from benefiting properties along the project corridor BACKGROUND: On November 3, 2004 the Rosemount City Council authorized the preparation of a Feasibility Report for County Road 38 (Bonaire Path)(CR 38) Street and Utility Improvements and on February 1, 2005 Council received the feasibility report and ordered the public hearing for February 15, 2005 This project has been designated as City Project No 393 The feasibility study for this project has been before Council at previous work session meetings to discuss policy considerations regarding the extension of City services to properties At the last Council work session, on January 12, 2005, the direction given to Staff was to omit proposed improvements to 132 Id Court, provide future expansion of sanitary sewer and watermain west of Trunk Highway 3 (TI-13), and to research the possibility of deferring assessments for the sanitary sewer and watermain services that will be provided to properties directly accessing CR 38 as part of the proposed improvements Since that meeting, the feasibility report has been updated to reflect the necessary changes as directed by Council Also, Staff has discussed with the City Attorney, options that Council can consider for recovering project costs from benefited property owners Attached is a copy of a letter from the City Attorney that provides an overview of options that the Council can consider to recover project costs SUMMARY: Staff respectfully requests Council direction for recovering project costs from benefiting properties along the County Road 38 proposed improvements project 470 US Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 (612) 337 -9300 telephone Ma N (612) 337 -9310 tax C ri A R T E R E D hap //w kennedy- graven cam CHARLES L. LEFEVERE Attomey at Law DlreLt Dial (612) 337 -9215 email clefevene@ kennedy- graven cam January 19, 2005 Andy Brotzler City Engineer City of Rosemount 2875 145" St W Rosemount, MN 55068 Re Collection of Special Assessments for Sewer and Water Protect Dear Andy You have asked for a letter describing the options available to the City to finance sewer and water project costs by current or deferred special assessments The most common procedure, of course, is to require the payment of the costs of extending sewer and water service to property through the collection of special assessments at the time service is provided The impact of such special assessments can be reduced by extending the term of payment of the assessments. State law authorizes special assessments to be deferred only in limited circumstances One is that special assessments on unimproved property may be deferred under Minn Stat §429 061, Subd 2 In the case of unproved property, the statutes authorize deferment of special assessments only in the case of properties owned by senior citizens or disabled persons Minn Stat §435 191 If a City Council decides that it does not want to collect the costs of such projects from benefited properties at the current time, but wishes to collect at a later time, it may collect the charges as a connection charge at the time the property is connected to sewer and water service Ordinarily, connection charges are imposed only to recover the costs incurred by the City in permitting and overseeing the connection of the property to public facilities However, State law authorizes connection charges to be adjusted to take into consideration the payment (or non payment) of special assessments at an earlier date Specifically, Minn Stat §444 075, Subd 3, provides in part that "Charges for connections to the facilities may in the discretion of the governing body be fixed by reference to the portion of the cost of connection which has been paid by assessment of CLL- 258220vl RS215 -3 Andy Brotzler January 19, 2005 Page 2 the premises to be connected in comparison with other premises, as well as the cost of making or supervising the connection The disadvantage of collecting these charges as connection charges in the future is that the City must carry the costs until connection In some cases, connection may not occur for a substantial period of time, and may never occur unless connection is compelled by an ordinance or the water or septic systems on the property fail It is common for cities to require properties to be connected to sewer and water within a specified time after service is made available to the property It seems to me that such an ordinance serves two purposes The first is that connection to a municipal water supply and sanitary sewer system protects the public health and environment The second is that reasonably prompt connection to the system will facilitate payment for both the construction and operation of the facilities If the City Council wishes to collect for the cost of the project through a connection charge, it would be necessary to amend the City's connection charge policies and rates so that properties that were not previously subject to special assessments would be required to pay those costs at the time of connection Please let me know if you have any further questions Very truly yours, Charles L LeFevere CLL peb CLL- 258220v1 RS215 -3 , City of Rosemount,Minnesota Estimated Tax Impact-8ased on Net Tax Capacity Capital Improvement Bonds Sized to Fund$1.9•52.5 Million of Construction Deposit to Construction 1,90Q000.00 2,200,000.00 2,500,000.00 Max.Mnual Levy 5182,091 5788,066 5212,990 Less Existing Levy SO SO SO Estfmated 2004/2005 Increase 5162,091 3188,066 5272,990 Market Net Tax TNTC 578,281,704 a18,281,704 518,281,704 Value(a) Capacity Tax Rate Increase(b): 0.887°/, 1.029% 1.165% Homestead Residential 150,000 1,500 13 15 17 200,000 2,000 18 21 23 250,000 2,500 22 26 29 300,000 3,000 27 31 35 Commercial/IndustHa l $100,000 $ 1,500 $ 13 $ 15 $ 17 150,000 2,250 20 23 26 250,000 4,250 38 44 50 500,000 9,25D 82 95 108 1,OOQ,000 19,250 171 198 224 Apartments(4 or More Units) $ 50,000 $ 625 $ 6 $ 6 $ 7 75,U00 938 8 10 11 100,000 1,250 11 13 15 � 200,000 2,500 22 26 29 500,000 6,250 55 64 73 qgriculturai Homestead Value per Acre $ 1,700 Dwelling Est. Net Tax Mark t Acras Total EMV!d) aci $ 100,000 80 $ 236,000 $ 1,756 $ 16 $ 18 $ 20 160 372,D00 2,504 22 26 29 320 644,000 4,000 35 41 47 640 1,188,000 9,180 81 94 107 /18dcuftural Non-Homestead Net Tax ' Acres Total EMV(d) a 't 80 $ 136,000 $ 1,360 $ 12 $ 14 $ 16 160 272,000 2,720 24 28 32 320 b44,000 5,440 48 56 6& 640 1,088,000 10,880 96 412 127 (a) EsGmated market value is the basis from which the net tax capaclly is calculated. This value is not necessarily the price the property wouid bdng If sofd. (bJ The tax rate increase is derived by dividing the average debt service by the taxable net fax capacity. The dokar increase in taxes payable Is derived by mulliprying the ne!tax capacity by the tax capaciry rate increase. (cJ lncludes house,garage and one acre with an estimafed markel value of$100,000.00 (d)Estimated value per tillable acre is$1;700.00 Note: Changes in interest rates,timing or size of the bond issue may cause signiiicant alterations of this information. ��:', ��lt"!�1€�St�i� • Preliminary Z,000,oao City of Rosemount, Minnesota General Obligation Capital Improvement Plan Bonds,Series 2005 (Fire Station) Sources& Uses Dated 06/01/2005 ( Delivered 06/01/2005 Sources Of Funds ParAmount of Bonds...........................................................................................................:............................................ $2,000,000.00 TotalSources.................................................................................................................................................................. S2,OOO,OOO.OQ Uses Of Funds Available for Project Costs....:................................:......................:........ .......:.........................................:...........:........ 1,900.773.33 Deposit to Capitalized tnterest(CIF)Fund.....:........................................:.....:......................................,............................: 50.351.67 Total Underwriter's Discount (1.300%)............................................................................................................................. 26,000.00 Costsof Issuance............................................................................................................................................................. 22,875.00 Total Uses...............................................................................:................... ...... $2,000,0OO.Op .............................................................. � . � . � f!!e/ROS£MO-J.SF/Serles 20'05 C/PBands fir/SlN6L£PURPQSE�/2/3/2005/ f0.�13AM . . � � � . � . � .. � �.� . �':��`� ��"l�� • Preliminary 2,000,000 City of Rosemount, Minnesota General Obligation Capital Improvement Plan Bonds, Series 2005 (Fire Station) NET DEBT SERVICE SCHEDULE Date Principal Coupon Interest Total P+I Cap.Interest Net New�/S 105%of Total Levy Required 02/01l2006 - - 50,351.67 50,351.67 (50,351.67) - - - 02/01/2007 75,000.00 2.500°/a 75,527.50 150,527.50 150,527.50 158,053.88 158,053.88 02101/2008 80,000.00 2.600% 73,652.50 453,652.50 - 153,652.50 161,335.13 161,335.13 02/01/2009 80,000.00 2.750% 71,572.50 151,572.50 - 151,572.50 159,151.13 159,151.13 02/01l2010 85,000.00 3.OD0% 69,372.50 154,372.50 - 154,372.50 162,091.13 162,091.13 02/01/2011 $5,000.00 3.20Q°fo 66,822.50 154,822.50 - 151,822.50 159,413.63 159,413.fi3 • 02/01/2012 90,000.00 3.350% 64,102.50 154,102.50 - 154,102.50 161,$07.63 161,807.63 02/01/2013 90,000.00 3.500% 61,087.50 151,087.50 - 151,087.50 158,641.88 158,641.88 02l01/2014 95,000.00 3.600% 57,937.50 152,937.50 - 152,937.50 160,584.38 160,584.38 02/01/2015 95,00�.00 3.700% 54,517.50 149,517.50 - 149,517.50 156,993.38 156,993.38 02/01/2016 100,000.00 3.800% 51,002.50 Y51,002.50 - 151,002.50 15$,552.63 158,552.63 02/01/2017 105,000.00 3.900% 47,202.50 152,202.50 152,202.50 159,812.63 159,812.63 02/01/2018 110,000.00 4.000% 43,107.50 153,107.50 - 153,107.50 160,762.88 160,762.88 02/01/2019 115,000.00 4.050% 38,707.50 153,707.50 - 153,707.50 161,392.88 161,392.88 02/01(2020 120,000.00 4.100% 34,050.00 154,050A0 - 154,050.00 161,752.50 161,752.50 02/01/2021 125,000.00 4.150% 29,130.00 154,130.90 - 154,130.d0 161,836.50 161,836.50 02/01/2022 130,000.00 4.250% 23,942.50 153,942.50 - 153,942.50 '161,639.63 161,639.63 02/01/2023 135,000.00 4.300% 18,417.50 153,417.50 - 153,417.50 161,0$8.38 161,088.38 02/01/2024 140,000.00 4.400% 12,612.50 152,612.50 - 152,612.50 160,243.13 160,243.13 02/01/2025 145,000.00 4.450% 6,452.50 151,452.50 - 151,452.50 459,025.13 159,025.13 Total $2,000,000.00 - $949,569.17 $2,949,569,17 (50,351.67) $2,899,217.50 $3,044,178.38 $3,044,178.38 Dated............................................................................................................................................................................................. 6/01/2005 DeliveryDate....................................................................................................................................................:............................ 6101/2005 FirstCoupon Date.....................................................................................................................................................:................... 2l01/2006 Yield Statistics , BondYear pollars.....................................................................................:................... ................:...... .............................. $23,533.33 AverageLife........................:..................................................................:...................................................................................... 11.767 Years AverageCoupon....................:......:....:........................................................................................................................................... 4.0349965�0 NetInterest Cast(NIC)................................:.............................................................................................. ...:..... .............. 4.1454781% , TrueInterest Cost(TIC)......................................:................:......................................................................................................... 4.1458322% Bond Yield for Arbitrage Purposes..............................................:.................................................................................................. 4.0002484% AllInclusive Gost(AIC)...............................................................................:.....................................:...........................................: 4.2761880% IRS Form 8038 NetInterest Cost............:.............................................:........:..........,....................................................................:......:................. 4A349965�0 WeightedAverage Maturity................................................................:........................................................................................... 11.767 Years � ��fIk/ROSEMO-7.Sf/Selles 2pO5 C/PBnx(s flr/SlNGLEPURPD,Sf/2/3/2005/ 70.�31 AM� � � . � � .� . � . � � � . � �� C"�C��'�� Preliminary 2,315,000 City of Rosemount, Minnesota General Obligation Capital Improvement Plan Bonds, Series 2005 (Fire Station) Sources 8 Uses Dated 06/01/2005� Delivered 06/01t2005 ' Sources Of Funds ParAmount of Bonds........................................................................................................................................................ $2,315,000.00 TotalSources..............................:................................................................................................................................... 32,315,000.00 Uses Of Funds Available for Project Costs....................:............................................................................................................................ 2,2�1,263.33 Deposit to Capitalized Interest(CIF)Fund..............................................................................................................:.......... 58.241.67 Total Underwriter's Discount (1.300°/0)............................................................................................................................. 30,095.00 Costsof Issuance...............................:..............................................................................:.............................................. 25.400.00 TotalUses....................................................................................................................................................................... 52,315,0OO.OQ . . � � file/ROSfMO-LSF/SerirsZDOSC/PBondsfi�/S/N6tfPURPOSf/�2/3/2A05( f0.76AM. � . . . . � . . . � . � . � .. � . � . �� 3JC'l�3��"�� .,E�� ` Preliminary 2,315,000 City of Rosemount, Minnesota General Obligation Capital Improvement Plan Bonds, Series 2005 (Fire Station) NET DEBT SERVICE SCHEDULE Date P�incipal Coupon Interest Total P+I Cap.Interest Net New D/S 705%of Total Levy Required 02/01/2006 - - 58,241.67 58,241.67 (58,241.67) - - 02J01/2007 90,000:00 2.500% 87,362.50 177,362.50 - 177,362.50 186,230.63 186,230.63 02/01/2008 90,000.00 2.600°� 85,112.50 175,112.50 . - 175,112.50 183,868.13 183,868.13 02/01/2009 95,000.00 2.750% 82,772.50 177,772.50 - 177,772.50 186,661.13 186,664.13 02/0112010 95,000.00 3.000% 80,160.00 175,160.00 - 175,160.00 183,918.00 183,91$.00 02/01/2011 100,000.00 3.200% 77,310.00 177,310.0� - 177,310.00 186,175.50 186,175.50 -02/01/2012 105,0OO.OQ 3.350% 74,110.00 179,110.00 - 179,110.00 188,065.50 1$8,065.50 02/01/2013 105,000.00 3.500% 70,592.50 175,592.50 - 175,592.50 184,372.13 184,372.13 02/01/2014 110,000.00 3.600% 66,917.50 176,917.50 - 176,917.50 185,763.38 185,763.38 02/01/2015 115,000.00 3.700°!0 62,957.50 177,957.50 - 177,957.50 186,855.38 186,855.38 02l01/2016 120,000.00 3.800% 58,702.50 178,702.50 - 178,702.50 187,637.63 187,637:63 02(01/2017 120,OOQ.00 3.900% 54,142.50 174,142.50 - 174,142.50 182,849.83 1$2,849.63 D2/01I2018 125,000.00 4.000% 49,462.50 174,462.50 - 174,462.50 183,185.63 183,185.63 02/01l2019 130,000.00 4.050% 4A,462.50 174,462.50 - 174,462.50 183,185.63 183,185.63 02/01/2020 135,000.00 4.100% 39,197.50 174,197.50 - 174,197.50 182,907.38 982,907.38 02/01/2021 145,000.00 4.150% 33,662.50 178,$62.50 - 178,662.50 187,595.63 187,595.63 02/01/2022 150,000.00 4.250% 27,645.00 177,645.00 - 177,645.00 186,527.25 186,527.25 02/01l2023 155,000.00 4.300°!0 21,270.00 176,270.00 - 176,270.00 185,083.50 185;083.50 02/01/2024 160,000.00 4.400°h 14,605.00 174,605.00 - 174,605.00 183,335.25 183,335.25 02/01/2025 170,000.00 4.450% 7,565.00 177,565.00 - 177,565.00 186,443.25 186,4d3.25 Total $2,315,000.00 - $1,096,251.67 $3,411,251.67 (58,241.67) $3,353,010.00 $3,520,660.50 $3,520,660.50 . Dated.........................................................................:....................................:........................:.........::............................................. 6/01/2005 DeliveryDate.................:........:.........................................................................:....................................................:.......:................... 6101/2005 FirstCoupon Date..........................................................:.................................................................................................................. 2/01/2006 Yield Statistics BondYear pollars..............................................................................................................:......................... .......................:....... $27,t78.33 ' AverageLife...................................................................................................................................................................................... 11.740 Years AverageCoupon....................................................................:.....................................................................................:.................... 4.0335500% NetInterest Cost(NIC)..................................................:.............................................................. .............................................: 4.1442816% TrueInterest Cost(TIC)................................................................:................................................................................................... 4.1444755°!0 Bond Yield for Arbitrage Purpases........................ ................ 3.9986259% ............................................................................................................. AllInclusive Cost(AIC).....:............................................................................:...............::................................................................. 42697125°l0 IRS Form 8038 NetInterest Co§t:..............................................................................................:.......................................... ..................::........... 4.033550�°k WeightedAverage Maturity..............:..................................:............................................................................................................. 19.740 Ysars .� � . . � fi/e/ROSEMD-LSF/Series2005CfP&Ntdsfir/SINGLEVf/RPOSf/2/3/2005/ 10.�3fAM . . � � � � .. . � . � ' . . .. .� . . � �.��. «��'� � . . . . � � . . . . . . . . � . . � . . . . . . . � . . '' Preliminary � 2, 30,000 City of Rosemount, Minnesota Generaf Obligation Capital Improvement Plan Bonds, Series 2005 (Fire Station} Sources 8 Uses . Dated O6/01/2005 ( Delivered 06/01/2005 Sources Of Funds ParAmount of Bonds............................................................................:.....................................:..................................... $2,630,040.00 TotalSources............................................................................................................................:..................................... 52,630,000.00 Uses Of Funds Available for Projecl Costs.:.............:......................................................................:......:................................................... 2,502.983.33 Deposit to Capitalized Interest(CtF)Fund......................................................................................................................... 66,176.67 Total Underwriter's Discount (1.300%).............................:............................................:.................................................. 34,190.00 Costsof lssuance..........................,.................................................................................................................................. 26�650.00 TotalUses....................................................................................................................................................................... 52,630,000.00 . � fi/e/ROSfMO-LSF/�Ser/et2005�C/PBondsFir/SlN6L£PURPOSE/2/3/ZPOS/ 70.�78AM � � � � � �. : � . � . � � � �� -�� C'1��t� � Preliminary 2,630,000 City of Rosemount, Minnesota General Obligation Capital Improvement Plan Bonds, Series 2005 (Fire Station) NET DEBT SERVICE SCHEDULE Date Principal Coupon Interest Total P+I Cap.Interest Net New D/S 105°fa of Total Levy Required 02l01/2006 - - 66,176.67 66,176.67 (66,176.67) - - - 02/01(2007 100,000.00 2.500% 99,265.00 199,265.00 - 199,265.00 209,228.25 209,228.25 02l01/2008 105,000.00 2.600% 96,765.00 201,765.00 - 201,765.00 211,85325 211,853.25 02t01/2009 105,000.00 2.750% 94,Q35.00 199,035.00 - 199,035.00 208,986.75 208,986.75 02/01l2010 110,000.00 3.000% 91,147.50 201,147.50 - 201,147.50 211,204.88 211,204.88 02/01/2011 115,000.00 3.200% 87,847.50 202,847.50 - 202,847.50 212,989.88 212,989.88 02/01/2012 115,000.00 3.350% 84,167.50 199,167.50 199,167.50 209,125.88 209,125.88 02/01/2013 120,000.00 3.500% 80,315.00 200,315.00 - 200,315.00 21Q330.75 210,330.75 02/01/2014 125,000.00 3.600°!0 76,115.00 201,115.00 - 201,115.00 211,170.75 211,170.75 02/01/2015 130,000.00 3.700% 71,615.00 201,615.00 - 201,615.00 211,695.75 211,695.75 02t01/2016 135,000.00 3.800% 66,805.00 201,805.00 - 201,805.00 211,89525 211,89525 02/01/2017 140,000.00 3.900% 61,675.00 201,675.00 - 201,675.00 211,758.75 211,758.75 02/01/2018 145,000.00 4.000°k 56,215.00 201,215.00 - 201,215.00 211,275.75 211,275J5 02/01/2019 150,000.00 4.050% 50,415.00 200,415.00 - 200,415.00 210,435J5 210,435.75 02/01/2020 155,000.00 4.100% 44,340.00 199,340.00 199,340.00 209,307.00 209,307.00 ' 02/01/2021 160,000.00 4.150% 37,985.00 197,985.00 - 197,985.00 207,884.25 207,884.25 02/01/2022 170,0OO.OQ 4.250% 31,345.00 201,345.00 - 201,345.00 2t1,412.25 211,412.25 02/01/2023 175,000.00 4.300% 24,120.00 199,120.00 - 198,120.00 209,076.00 209,076.00 02/01l2024 185,000.00 4.400% 16,595.00 201,595.00 - 201,595.00 211,674.75 211,674.75 02/01/2025 190,000.00 4.450°10 8,455.00 198,455.00 - 198,455.00 208,377J5 208,377.75 Total $2,630,000.00 - $1,245,399.17 $3,875,399.17 (66,176.67) $3,809,222.50 $3,999,683.63 $3,999,683.63 Oated............................ . ............:..:.....................................::....................................................................... 6/01/2005 ..................................... DsliveryDate........................................................................................:...........................:..............................:.......:......................... 6/01/2005 FirstCoupon Date.............................:......................................................................:.......:................................................................ 2/01/2006 Yield Statistics BondYear pollars.........:.........:...............................................................................:......................................................................... $30,878.33 AverageLife.........................................,..................................................................................................................................,......... 11.741 Years AverageCoupon.......................................................................................................................................................................:....... 4.Q332461% NetInterest Cost(NIC).......................................................................................................................:............................................. 4.1439710% TrueInterest Cost(TIC}.................................................................................................................................................................... 4.1442431% Bond Yield for Arbitrage Purposes...........................................................................................................:......................................... 3.9984218°!0 All Jnclusive Cast(AIC).................:...............:............... . 4.2598112% 1RS Form 8038 Net Interest Cost........:...... ..................................................................:........................,...............:....... ................ 4.0332461% ....................... WeightedAverage Maturity..................................................................:...........................................................................................: 11.741 Years . � . fi/e�/ROS£MO-1.Sf/Series2005C/VBandsfr��srNccevuenose/zisizaos/ �o.�3oan� � �� . � . � .. � � � � � � � . . � � . . . ��'�, �� . .... . . � . . � . . .. . . . � � � � � ..