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Home My WebLink About7.a. Transportation Utility Legislation Discussion Y z CITY OF ROSEMOUNT EXECIITIVE SUI+�lA7l�Y FOR ACTION CITY COUNCZL MEETING DATE: February 2, 1993 AGENDA ITEM: Transportation Utility AG�NDA SECTSONs New Business PREPARED BY: Bud Osmundson AGENDA I�'�� City Engineer/Assistant Public Works Direc�or ! ATTACHI�SENTS: Resolution; "Elements of a AP O✓v'E�' B . Tran Utility" ; Article Re: Tran Utility ,/.�� As you are all well aware, funding for recons�ructi and tenance of streets is a problem. The fundinq sources for reconstruction and maintenance are Municipal State Aid Funds, assessments to benefitting properties and general funds. General funding in this time of tight budget constraints is hard to justify and easy to eliminate frorn the budget. This makes it difficult to fund the upgrading or reconstruction of streets . At the recent City Engineers Annual meeting two items were discussed which could alleviate -some of the �unding problems. One item discussed was the definition of "benefit° in the Chapter 429 State Statutes. As it has been defined in the past few yearss the "benefit�' is the increase in proper�x value that the �m rovement brings , to. the property. In many cases the City can s end $5, O�G-�$10, d00 �er lat in improving the street and have a "bene�it" ruled as a portion of that. One idea was to ut a definition of "benefit" into the 1aw. Tn other words, define a "bene�it° as five ar ten percent of the market value of the home that can be assessed without having appeals and the procedures involved with those appeals. The second item discussed was the imp lementation of a Transportatian Utility. Currently State Statute allows cities to impose a Utility Fee far the use of sewer, water and storm sewer. The Transportation Utility has been discussed in recent legislative groups but has nat been brought to the floor of the House or Senate because of the lack of sup ort by the general public. This year, the City Engineers Association adop�ed a resolution urging the legislature to pass a law allowing municipalities to im ose a Transportation Utility Fee and set up a Transportation Utility. A�tached is a draft of the elements of a Transportation Utility whieh was provided to select legislators in the 1992 session. This revised draft explains the �rocedures, collection plans and other requ izements that would be involved in the setting up o� a Trans�ortation Utility. The Transportation Utility Fee is general.ly a user fee in much the same way as sewer, water, etc. and is based on daily trip generation rates based on land use categories, What this does is place a higher fee on a high trip generation industry, such as a fast food restaurant, while keeping a moderate fee for a single family horne. The attached resolution is in support , of the legislature passing legislation which would enable cities or municipalities to establish Trar�sportation Utilities . Passing of this resolution does not allaw Rosemount to establish a Transportation Utility, but does give support of the concept. Staff recommends a�proval of the resolution supporting, enabling legislation allowing munieipalities to establish Transportation Utilities. RECONIl�+IENDED ACTION: MOTION TO ADOPT A RESOLUTION SUPPC?RTING ENABLING LEGISLATION ALLOWING M[TNICIPALITIES 'TO ESTABLISH TRA.NSPORTATION UTILITIES. COIINCIL ACTION: l CITY OF ROSEM4UNT DAKOTA COUNTY, MINNESOTA RESOLUTION 1993 - A RESOLUTION SUPPORTING ENABLING LECISLATItJN ALLOWING MUNICIPALITtES TO ESTABLfSH TRANSPURTATiON UT1L1T1ES WHEREAS, streets under the jurisdiction o# Minnesota cities comprise an integral and necessary component of the overali State transportation system; and WHEREAS, cities of Minnesota are experiencing large scale deteriaration of fiheir local street systems; and WHEREAS, funding provided from the State gasofine tax in the form of the Municipal State Aid Street system is applicable to Ro more than 20 percent of any city's local street system, and WHEREAS, recen# court rulings pertaining to special assessment laws haue found limited benefit accrues to affected properties when a deteriorated street is reconstructed, resulting in a significant reduction in special assessment levies; and WHEREAS, property taxes at the rates typically being levied do not take into consideration the need to rehabiiitate and/or reconstruct city streets. NOW, THEREFORE, BE IT RESOLVED by the City Cauncil of the City af Rosemount, Minnesota that: 1 . Funding street reconstruction and rehabi{itation on a user fee basis is consistent with the State's user fee funding philosophy for sanitary sewer, sfiorm sewer and watermain facilities and other transportation improvernents utilizing gasoline taxes. 2. Funding pravided by a transportation utility based on a user fee concept will result in a stable, long term funding source to finance street reconstruetion anti rehabilitation. 3. The City urges members of the House of Representatiues and the Senate to support and adopt legislation that will ailow cities to estabtish transportation utilities as a source of funding for the maintenance and improvement of the cities' local street sys#ems. ADOPfiED this 2nd day of February, 1993. E. `B. McMenomy, Mayor A7TEST: Susan M. Walsh, City Clerk Motion by: Second by: Voted infavor: Voted against: r c DRAFT 11/92 ELF.IV�NTS OF A TRANSP4RTATION UTILITY Definitions. For the purposes of this section, the term "municipality" means a home rule eharter or statutory city. The term "governing body° means the city council. � Authorization. Authority for a municipality to impose a transportation utility fee is enabling only, No rnunicipality is required to use the fee. Only municipalities which fc�llow the ' procedures for adoption may impose the fee. Procedures for adaption. The governing body af a municipality may impose a transportation utility fee coterminous with its territanal limits, by ordinance adopteci by a two-thirds vote of all its members. No such fee shall be adopted until after a public hearing has been held on the question. A notice of the time, place, and purpose of the heari.ng shall be published for two successive weeks in the official newspaper of the municipality (or in a qualified newspaper of general circulation in the municipality, and the last nodce be at least seven days prior to the day of the heaxing. The ordinance, when adopted, shall be filed with the caunty auditor and county recorder. Collection. An ordinance adopted under this authority shall provide for collection of the transportation utility fee on a monthly, quarterly, or other basis as the municipality determines. The municipality may use regular utility billings, for such services as water, sewer or stormsewer, to implement the transportation utility charges. A municipality may pravide for certifying unpaid transpartation uti.tity'fees to the county auditor against the property on which the fee is imposed fflr collection. The fee may be collected from all properties within the municipalityo Properties which are exempt from property taxes still be subject to the fee. Master plan requirement. A rnunicipality shall be allowed to use the transportation utility only after preparation and adopti�n of a "master plan." A capital improvement plan (CIP), public faciiities plan, or comparable information and planning document providing a five year program will qualify. The glan shall include information on proposed reconstruction, faciiity upgrade, and maintenance expenditures. The plan must include information an the proposed funding sources for all projects. The governing body of a municipality may, by resolution of its members, adopt or revise the master plan. The plan shall be annually updated to reflect a fiue year planning program. No transportation utility fee be authorized without adoption of a master plan. A notice of the time, place, and purpose of the hea.ring to adopt the master plan sliall be published for two successive weeks in the official newspaper of the municipality, or in a qualif'ied newspaper of general circulation in the municipality, and the iast notice be at least seven days prior to the day of the hearing. Iise of fee proceeds. The praceeds of all transportation utility fees must be placecl in a separate � fund and only used for the following eligible purposes which have been specified in tfie master plan: Recorrstruction -- paving, grading, curb and gutter, bridge repair, overlays, drainage structures, base work, subgrade correction and boulevard restoration. Faciliry upgrade -- traffic signals, turn lanes, medians, street apgroaches, alleys, rights of way, sidewaIks, retaining walls, fence installation, additional traffic lanes. Maintenance -- striping, seal coating, crack sealing, sidewalk maintenance, signal ma.intenance, street light maintenance, signage. The revenues generated by the fee may not be transferred to the general fund of the municipality. Trip generation data. Fees will be calculated based on the relationship of the revenues the municipality proposed to generate and the trip generation rates by type of land use. Land use catear orv Unit Daily trip �,eneration ran�e 1. Residential * single family d.u. 7.5 - 12.5 * apartment, townhouse d.u. 4.5 - 7.5 highrise, mobile home park, low rise cando * retirement community, d.u. 2.5 - 3.5 congregate care, ' recreational home 2, L.odging * hoteUmotel �ooms 7.0 - 11.0 3. Schools * eiementary students 0.5 - 1,5 * seconda.ry students 1,0 - 2.0 * college/university students 2.0 - 3.0 2 1 i Land use categorv Unit Daily triQ,�eneration range 4. Services * church/synagogue 1QOO sq ft 7 - 11 * library " 34 - 56 * day care center " 50 - 84 . * government offices " 50 - 84 * post office " 65 - 109 * state motor vehicle dept ° 125 - 207 * banks (walk/drive in) �� 188 - 312 5. Offzce * hospital 1000 sq ft 13 - 21 * clinic {medicaUdental) ° 25 - 4 i * general o�ce bldg ' 0 - 50,000 sq ft " 17 -�27 50 - 2Q0,000 " 11 - 17 200 - 4Q0,000 " 8 - 14 over 440,000 ° 7 - ll 6. Retail , * iow intensity 1OOQ sq ft 27 - 45 * medium intensity " 73 - 121 * high intensity ° 535 - 891 * shopping center 10 - SO,OOfl sq ft " 94 - 156 50 - 100,000 ° 60 - 1Q0 100 - 200,404 " 47 - 77 200 - 600,000 ° 32 - 52 aver 600,000 ° 24 - 40 7. Industrial * general light/ ind pk 1400 sq st 5 - 9 * manufacturing/warehousing " 3 - S 8. Recreational * city/county park aeres 2 - 4 * golf course " 6 - 10 * beach/regional park ° 13 - 21 * other recreational 1040 sq ft varies 9. Terminals * commercial airport �- pass. orig. 4 - 6 * general aviation 3 ♦ . �.d . � . . . Land use categor� Unit DailY trip generation range airport based craft 5 - 6 * waterportlmarine � terminal acres 9 - 15 * transit terminals # of buses varies 10. vacant 0 Review. A munieipality may also petition this eommittee to develop or review trip generation data for land uses which are not inciuded in the existing land nse categories. The committee may also annual review all ranges. Tfie cvmmittee review and update trip generation data, � when necessary, whenever the Institute of Traffic Engineers issues a new edition of their traffie genera�ion manual. Pas�-bv reduction. Reductions based on data from the Institute of Traffic Engineers for pass-by trips have been made to the trip rate ranges calculated for the following property uses: services (15 percentJ, iow intensity retail (20 percent), shopping centers (40 percent), and high intensity retail (50 percent). (Pass-by trips are made as intermediatestops on the way fram a point of origin to a primary destination. These trips are attraeted from tr�c passing the site on an adjacent street and do not require diversion from another roadway.) TDM credit. A credit would be available for employers and building owners who implement traffic demand strategies (TDM}. Where lawer tr�c generation rates can be proven for two consecutive years, the ciry will caleulate an adjustment to the trip generaxion factor on which the fee is based. Annual proof of reduced vehicle traffic would be required to maintain the credit. Accrual of fee revenues. Revenues from the utility fee shall only be used for the specific reconstruction, facility upgrade, and maintenance projects listed in master plan, and are therefore limited to the projected costs of the needs approved in the master plan. The dedicated fund may not accumulate revenues from the utility fee beyond the fee revenues generated over a period of five years. Appeal process. Pro e�rtv owner. An owner of property within the municipality may appeal the amount of the fee or the trip generation rate which is used for that property. An administrative appeal may be made to the administrative off'icer of the municipality. The decision of the admini.strative officer may be appeaied to the city council. Tfie property awner may appeal the decision of the city ' council to the district court. Municipalit� A municipality may appeal ranges of trip generation to the Municipal State Aid Screening Committee-appointed by the Commissioner of the Department of Transportation. 4 �, , . 5pecial assessments, bonds, property tax levies. Use af the transportation utility fee does not restrict the municipality from imposing special assessments, issuing bonded debt, or levying property taxes to pay the casts af local street reconstruction, facility uggrade, or maintenance prajects, Revenue bonds may be issued in conjunction with tfie utility and may be refired with utility fee revenues. 5 � � � �- `� :� � .. . . �` � �� • *�` � �, �4� �� ' . - „ �� . - . - - -�.. ,- .� - �::, Impiementafion and � ..� ,�� .� _ . �• .` ., ""�"�. �`'' operation of a .. : � � �.,� -� '�� . .< ,: ... _ �' ,��r.�� { 7�T�r�ans�o�t�.t�on�u fee—'�r.- �`a�sporta�ion utility � ,..��. s-�' ��,Y1 r -.��. {��"'� _�.s � One{�ossible soiution to chis lack of ' ';-'v�R!�'� 1"+4'-�li'i z+`.�"s+w'+ v.:��'rSf'Sd..�.�-�.��`Yl� 4 I.�vh��s�'�?i � 7' � � �"��' `��' ��'".�"""�+��:�� .��=�:'� � = �..:�,�;� f., funding is a cransportation utilin•fee.In �.�funding alternative�forarnaintenance:and�,,�� a uan5por�Uon uu�,�,�,the"users"of r �� ;�� .n— 2ti7�sx..r*Ll��}tr"y`'� '"k"°"'y' -s .. f -S i..a,,�� . . '�$��'�4��•�-� 4 """""h�'��'�`�,,,�."�'.,.',�,,��,� '4��; local cransportation s�scems�,•auld pa}• �-xeconstruction"O�Cl��streets �-,�.�x,...�.� �-�- � '{�a� fees based on the amount of uaffic .:,#''�`'�Y' �`"�.a� ....4 "� ,� � .1�h• �G'6: - :.� ,� . -t5...Y .Y,�s � 26"'+XK: '�4 ,,- A� � �`` �F� ,,� �'°`--`{.�K� ��,,.t..,�..,"� �'`�.�..��=��'-' genented b�•their propern•.The , _ . #�..-" a'�" i �f t . v . 3,"3'�`'-=xt � --s. � � :.<�'�; � ,��,.�..�,�,�� ,� -,� • ° �- -� '"�'`� transportaaon utilin•�,•ould not be a ta�: 3 ,r �, r��+-�.�� ,� Sf1RAFiHA(�TI'ANDJIIvt .�'s12U$F'r-� `�x��'�,,��"� ��. ; � �.�,� basedonpropern•�alueormarket s:. =g� � �. , �l-,��..��.�,� � '�� • h .,-� �'1�-,�.,�� ,.� �„4,, ,,�� " �alue>inscead,the amount of traffic ' ` , _ �,�,��'._. � y �. -�.=,.�w��•;rs� �;� '��-,, �+..,.�,;,�, generated�aould be the measure. It � �i^�`i:i ''��.r$�•�„�,�=r�r'-',.,''4�'�_r z,.�. .�i tc�...rs..�..,. 7 "s_.+a_.+,t.w' '�,,.�sn,� ;. � �_� s.�">�+ay . . �.-� _ � �_v,.�... .�.-.:;... � �_ .. a- ,�w� - ��•ould,like other udlities,be equitable. Because all properties benefirfrom an i adequate locai transportavon s��stem,all � The polic}�for the stace of?�4innesota is result in the need for total screet de��eloped properues�.ithin the cin�, quite clear—users pa�•the costs of the replacement.Ha«ng funds a�•ailable to �ncluding public instituuons and repair streecs�rhile the�•are sdll in goti�ernmenu,��•ould be charged a � transportadon s�•stem. Financing for the relati;�el}•good condition,rather than �nsportation utilit��fee. � totall�•replacing them after the��hare state's high�,•a��s,count��roads,and • Operation of a transpartation utilin• � "failed,"is a logical�+•a�•to keep street titi•ould be similar to the existing author- � municipal state aid screets is generated maintenance coscs under conrroL � in�for ciues to operate�cater,se��•er, � b�•re�•enues from "user fees"such as gas t�{f�s' transporEation storm se�rer,and other uulities.In thos:: 4 ta�:es and regisuadon fees. LTnlike this needs not be�ng met u�lities customers are charged,through ' monthh•or quarterly cin�udlit�•billings, : funding,there is no "user fee"a��ailable Hbwe��er,funding opuons for loca] for use and future maintenance and � transportation s}'stems are scarce.The reconstructiou of these udlities. A ! to fund locai cin•screets. Years of cuts use of s ecial assessments b�•ciues is P , transportacion uulit��ti��ould be deter- i in state aid,limits on propern�ta�:le�zes, becoming increasingl��limited. The mined b�•a fee based on the use of the ' bonded debt caps,and legal restrictions ��nnesata Supreme Court has upheld street s}�stem—the amount of u�c ! challenges to the use of special assess- g�nerated.Although u-ansporcadon use on the use of special assessments ha��e ments and the need to sho�ti•"proof of can not be precisel��metered,both left man}�cities tizthout the means to �enefit"to the affected properties scorm se�+�er and sanitan�se�cer utilities chrough an equal increase in the�•alue tiave set a precedent c,•here utiliues ma}' adequatel}�maintain and reconstruct ofxhe prop�rn�. In addiuon,it is oni}' operate ti,�thaut precise metering or local streeu. The use of user fees for possible to assess charges on properties direct association to properrcrn��alue. �,•hich ha��e been found to benefit from propern�ti-ithin a ciri�ti,�ould be uulities and infrasuucture is a basis for the project even when che�•alue of the grouped to reflect the general land uses cities to be given authority to implement impro�ement accrues to the entire e��dent in:�4innesota cities.Examples of � commun�t�•: Speciai assessmenu,as a the land cate ories could include: a transportation uti?i;��fee. share of total cin�re�•enue,ha��e been g i sing}e famil}�,detached hames,multiple Like all infrastructure,streets ha��e a shrink�ng since the earl}�1980s, In family units,lodging,parl:s,schools, 1 finite"life"which is dependent on 1981,the}�represented 12.1 percent, churches,hospitals,offices including compared to 7.9 percent in 1990. government offices,and retaiL In cives ' adequate and umei}'maintenance, In addition,state-collected revenues ��here special land uses exist,or are ' �reather condidons,txaffic,etc.ti'ith the account for onl}'a small portion of developed–amusemenc parks,abbe}�s, t funding for lo€al transportauon s}�stems. museums,etc.–a special catego��could i exception of a fe�r ne��l��developing Cities under 3,000 recei�•e no direct be created. . suburbs,cicies in;�linnesota hai•e man}' state funding for their local streets. Different amounts of traffic are Cities ot•er 3,0�0 recei��e AZunicipal State �enerated b}'different pro�ern•uses. streeu�vhich are at least�0�•ears old.A ;�id (�45.�) for a maximum of 20 Traffic generation data has been lack of funding often delavs umelv percent of their local sueets. State�.zde, nationall�•accepted as a�•alid technique ' ' there are nearh� 16,Q00 miles of cia• to esumate traf�ic fram e�isting and maintenance and repair,ti,•hich can streets. proposed de��elopmenu. It is currentic �� cr--- — -- K,<. _ .. �.��. . _-._..._�_ . -� ...._,... .,...<. ...., .-_,1�: .::�i..�_•. .��_..::?�'�.. :. . ___..} _. ._ . 'c':!.;_ .__. ,....._ ._�_.. .. �......._.-_ ... _ .....,. _..__'.._._�_ __ � ;1. /f1;��, oc^ - �. i used to determine necessary street T'he udiiry is not intended to pro�ide Under Oregon law,ciues are widths,traffic signal needs,road access for the costs of new construction,nor to authorized to finance local u-ansporta si arkin fund elective im rovements (beautifica- tion needs through a utility fee. The re uirements,and to de p g P q $m faeilides: The Insutute of Traffic aon,landscaping,etc.) or basic services ciry of Medford began using a street Engineers prepares a manual cidng which should be funded through a city's utiliry in February of 1992. The city of actual studies of local vaffic using dri�e- general fund (such as plotring or Tuwalatin,passed an ordinance in over traf�ic counters and visual counu. sweeping). The three primary uses for August, 1990,and now bills properry Aithough the land uses and projected the utiliry are reconstruction,including: ownersa monthly"road-utilityfee:" traffic generated would be quite paving,grading,curb and gutter,bridge In 1989,the Colorado Supreme uniform far any eity choosing to use the repair,overlays,drainage structures; Court upheld the authoriry for the ciry udlity,the fees on properues would vary faeility upgrades,including: turn lanes, of Fort Collins to collect a transparta- �� by ciry,depending on thesevenues medians,sidewalks,and additional iion udlity fee. The decision overruled � needed from the fee. traffic lanes;and nonelecuve mainte- the argument that the fee was aetuaily a Revenues from a transportavon nance,inciuding: seal coaqng,crack tax and did no[conform to the uniform utility would be dedicated only for sealing,sidewatk maintenance,signal/ taxadon requiremenu of the Colorado qualifted maintenance and reconstruo- street light maintenance,and signage Consdtudon. Instead of using this tion according to the city's master plan. (eg,infarmational,warning,regulatory). authority at this dme,Fort Collins is No revenues collected through this cananuing to use thc one-quarter cent uuliry could be used for general fund sales tax they are aliowed to impose for purposes. And,as with other city transportauon purposes. procedures,property owners would be The Florida Constitudon and state . pro��ided full legal recourse for appeal « law authorize cities such as Port Orange by a process through ciry management, �le�YlSp02"��t0I1 U�1� to collect user fees and create a"trans- the ciry council,and then to the district porravon udlity fund" for operadng, tourt. WOLt�.CI IIOt be 1�C1X�JaSeC�OIl maintaining,and improving their local road system.The local ordinance M�Sfer P�an because effective in December, 1991. requirement �woufd p p �' P P I�p Q V�,Ue Or III$t'kCt Oriando ex ects to im lement a d@'�E+/'l1111fe t�1�Ifl�1: transportation utility fee this year. activities value,instead, the amount of 'rne city council of Soap Lake, As proposed,legisladon authorizing Washington is the governing board of a traffic generated wouid be the utility and is authorized to use the utility the transportation uulity would be � enabling onIy.Ciry councils would be revenues to own,consuuct,maintain, res onsible to individuall determine operate,and preserve all city sueets and P y II2�a511re. It wauld,like ather related facilities." The state's 1990 and authorize use of this financing tooL Transportauon Funding Act authorized City councils would need to hold . . . » cities to use this local financing oprion, h�aringsto consider their transportation u�1�IES�be eq111�1b1e• �d many other cities in Washington are needs,the re�•enues available to the city, expected to use this authoriry in the and the local preferences for financing near future. infrastructure reconstruction and Although Minnesota has tradidonally maintenance.Not all cicies have Pr��en� pf u5e Ifl allowed cities few revenue sources,the immediate street infrastructure proh- lems;nor have all cities found all other other states �ncreasing criticisms of the property tax revenue alternauves to be inadequate. The concept of transportadon as a system and urgings to make t�es and To use a uansportation utiliry,a city "utility,"and an appropriate user fee, fees moreaccountable should provide would be required to develop a"master has been accepted by other states.In support for a use-related fee for city infrastructure such as the transportation plan."Expenditures of transportation those states where the uuiity is being uuli fee.■ utility revenues would be limited to the used,ciaesare not required to receive tY activities and projects listed in the auzhorizauon from the state.Those capital improvement plan,pubIic ciues operate under home rule authority S�Hackett is legislative repre- facilives plan,or comparable infarma- which permiu them to determine their sentative of the League of Minnesota 'I tion and planning including a multiple- local needs and develop the appropriate Gities. un Grube is ublic works year(3 to 5 years) program for opera- funding mechanism. Cities in Minne- J g uonal,maintenance,and reconstruo- sota are not given such flexibility or director of St.Louis Park. tion expenditures. authoriry.