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Home My WebLink About5.a. Assessment Policy for ImprovementsCITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION CITY COUNCIL MEETING DATE: MARCH 5, 1991 AGENDA ITEM: ASSESSMENT POLICY FOR AGENDA SECTION: IMPROVEMENTS OLD BUSINESS PREPARED BY: STEPHAN JILK, CITY ADMINISTRATOR AGENDA NO.,,.EpyS�(f�A� ATTACHMENTS: MEMO, APPROVED-ITY: THIRD DRAFT OF POLICY Please see attached memo outlining the Assessment Policy attached. RECOMMENDED ACTION: None - Discssion only. COUNCIL ACTION: None TO: FROM: DATE: RE: Cityofosernouni P.O. BOX 510 2875 -145TH ST. W ROSEMOUNT. MINNESOTA 55068 612-423-4411 Mayor Napper Council Members Klassen, Oxborough Willco ppermann Stephan Jilk, City Administrator March 1, 1991 Assessment Policy Please find a third draft of the proposed assessment/improvement policy for your consideration. Several changes have been made since our work session on this policy on February 25, 1991. They are: 1. A preface has been ad3ed outlining the concept of the "Street Reconstruction Program" and how the policy fits into that program. 2. Those areas within the policy which were discussed for changes are outlined so you can see those areas changed. 3. The main concept of the policy which determines how properties are actually assessed is outlined in Section VI. This area was completely revised to reflect the direction given at our workshop. That is, to define assessment based on a unit basis for single family residential properties and on a front footage basis for other uses. Prior to Tuesdays meeting we will add to this information by providing you with examples of how this policy would effect those properties on 145th Street. We will be pleased to discuss this with you on Tuesday. CITY OF ROSEMOUNT ASSESSMENT/IMPROVEMENT POLICY 3rd Draft March 5, 1991 TABLE OF CONTENTS Page 1 Preface Page 2 Introduction Page 3 Definitions Page 3 Policies and Procedures Page 4 Project Initiation_ & Hearing Process Page 6 Construction Standards Page 7 Useful Service Life Page 8 New Development Improvements Page 11 Existing Development Improvements Page 13 Method of Payment Page 14 Assessment Deferment Policy Exhibit A Stree Reconstruction Exhibit B Structual Maintenance Exhibit C Five Year Street Recontruction Program Exhibit D Residential Street Equivalent Estimate PREFACE This policy is the basis for, and plays an integral part in, the long range construction and reconstruction of streets, sanitary sewer, water, stormwater and trail improvements in the City of Rosemount. In construction of such improvements it is necessary to consider two basic issues: one, the improvement needed, and two, how will it be paid for. The City is entering a new era in regards to these types of improvements. Sections of the City are still developing with new residential, commercial and industrial developments which require utilities and streets. At the same time a section of the City is ageing and the infrastructure has aged and deteriorated such that it needs major upgrading and replacement. In new developments the cost of making such improvements can generally be born by the developer and development agreements where the cost are assessed over a rather short period of time and no additional burden is placed on the rest of the taxpayers. In older areas which are already developed, this may not be the case. When existing infrastructure is replaced after those improvements have "lived their normal life" the replacement costs may become such a burden to the property owners that those costs may be unacceptable and to assess all of these costs may prove difficult. Therefore, the City is attempting to develop a "Reconstruction" program utilizing revenue sources from several areas including: 1. Assessments 2. Minnesota State Aids for Highway Improvements 3. Sanitary Sewer Connection Charges 4. Water Utility Connection Charges 5. Stormwater utility user fees & connection charges 6. General Taxes. This concept wherein revenues from various sources will be "pooled" to develop a reconstruction fund allows assessments to be generated on a more equitable and consistent basis and still not create an extreme burden on the property owners. It also allows the City as a whole to share in the responsibility to maintain and protect the entire infrastructure for city services. The policy which follows outlines most specifically as to how improvements are initiated, how they are designed and finally how they are funded with the emphasis on assessments. - 1 - ASSESSMENT/IMPROVEMENT POLICY PAGE 2 This approach is taken so that those involved in improvement projects will be able to comprehend the approach taken and how they are to be charged for the benefit they receive through the improvement process. INTRODUCTION This document sets forth the methods and policies relating to local improvements and special assessments practiced in the City of Rosemount. It is emphasized that the following summarization is general in nature and that certain circumstances may justify deviations from stated policy as determined by the Rosemount City Council. A local improvement involves one or more of the following types of improvements: Roadway grading and base Bituminous surfacing Curb and gutter Sidewalks, trails and driveways Water trunklines and laterals Sanitary sewer trunklines and laterals Service connections Storm sewer trunks and laterals Street Lighting All appropriate appurtenances associated with the above improvements Improvements are classified as follows: 1. New Developments - The construction of improvements related to newly developed areas, normally made in conjunction with the plat approval process. 2. Reconstruction - see definitions (Section I.1) 3. Rehabilitation - Complete or partial reconstruction of the above mentioned improvements including bituminous overlays. Rehabilitation does not include routine maintenance which does not improve the structural integrity of a roadway, such as seal coating and crack fillings. 4. Preventive Maintenance - see definitions (Section I.3) 5. Extensions - Construction of improvements generally made to extend services to a certain area. Extensions normally pertain to water, sanitary sewer and storm sewer trunks. ASSESSMENT/IMPROVEMENT POLICY PAGE 3 The special assessment is a financing tool employed by the City of Rosemount as a means to allocate the cost of specific improvements to benefitted properties and to spread those costs over a number of years. Minnesota Statues Chapter 429 regulates the procedure for the construction and financing of local improvement projects when at least part of the cost is defrayed by special assessments. Special assessments are collected from the property owner along with real estate taxes. when an improvement is of benefit to certain areas, it is the intent of the Council that special assessments be levied against benefitted properties. A major goal of this document is that special assessments be allocated and levied in an equitable and consistent manner. SECTION I DEFINITIONS Additional definitions will be added as policy needed. 1. RECONSTRUCTION - will be defined as a project whereby all meaningful elements of a street are being removed and replaced. This would include curb and gutter, sidewalks, trail, bituminous or concrete pavement, granular base, and items appurtenant to these elements. 2. REHABILITATION - will be defined as a project in which one or more of the aforementioned elements is modified or supplemented in-place, to restore the serviceability of the entire street, such as bituminous overlays. 3. PREVENTATIVE MAINTENANCE - will be defined as work that involves a level of effort less than that involved in reconstruction or rehabilitation, the intent of which is to extend the life of the existing improvement. Preventative maintenance will include but not be limited to crack filling, patching, milling and cold planing, and seal coating. SECTION II GENERAL POLICIES AND PROCEDURES The following are general principles, policies and procedures applicable to all types of improvement: 1. Project costs shall include the cost of all necessary construction work required to accomplish the improvement, ASSESSMENT/IMPROVEMENT POLICY PAGE 4 plus engineering, legal, financing, easement acquisition and contingency costs. 2. Assessable costs are project costs minus the City and County share and other credits. MSA funds will not be credited as they will be utilized to offset total reconstruction program costs. 3. Special assessments will be levied as soon as practical. Normally this will be within one year after completion of the project. 4. Publicly owned properties, including but not limited to municipal building sites, schools, parks, County, State and Federal building sites, but not including public streets and alleys, are regarded as being assessable on the same basis as if such property were privately owned. 5. Revenue sources for these types of improvements will be many including, but not limited to assessments, MSA Funds, core facility funds and general tax levies. This policy determines an equitable assessment approach such that the property will pay on "equivalent" amount on each project no matter what other sources are available. SECTION III SPECIFIC POLICIES Prolect Initiation and Hearing Process This section intends to describe the initiation of improvement projects and the administration required to final Council action, pursuant to the requirements of MSA 429. A. Project Initiation 1. By Petition: Petitions for initiating improvements will be prepared by City staff upon request. Such petitions, circulated by the affected owners should bear the signatures of the property owners of 35% or more of the benefitted property. Petitions may be requested and submitted at any time. Projects for petitions received after February 1 will not be scheduled until the construction season of the following year. The normal time required for receiving, processing, scheduling hearings and preparing construction documents is six months. 2. By Council Action: If the Council determines that an improvement is in the best interest of the City, it can, ASSESSMENT/IMPROVEMENT POLICY PAGE 5 without petition, initiate the improvement with a four/fifths vote of the Council. 3. By 100% Signed Petition: When a petition is signed by 100% of the property owners benefitted by the improvement, and there is no City cost participation, the Council may order the improvement without holding an improvement hearing. 4. By Development Contract: Improvement projects for new development will only be considered upon execution of a developers agreement signed by 100% of the benefitted property owners. The Council may order the project without a public hearing. B. Hearing Process 1. Improvement Hearing: After a petition if filed and its adequacy determined, or the Council initiates the project, the City Engineer is directed to study and report as to the feasibility of the improvement. If after reviewing the feasibility report, the Council feels the project has merit, a public hearing is scheduled, notice published twice, and all persons benefitted by the project notified in writing. When an improvement project is to be financed by the sale of improvement bonds, there is a statutory requirement that at least 20% of the total costs of the project be assessed against the benefitted property. If after the improvement hearing, at which all persons are heard, the Council feels that the project still has merit, then the Council will authorize the preparation of necessary plans and specifications, and upon receipt and acceptance of those plans, will authorize the advertisement for bids, by resolution, for the construction of the project. C. Final Hearing (Assessment) After the improvement is ordered and bids received and the improvement is completed, a roll will be prepared and the affected property owners will be mailed a Notice of Assessment Hearing stating the time and date that an assessment hearing will be held. An assessment roll will be prepared and will be posted at the City Hall for review prior to the assessment hearing. All interested parties shall have an opportunity to be heard regarding the assessment. Necessary and proper adjustment to the assessment roll can be made by Council at the time the hearing is being held. If an appeal is made regarding the amount of the special ASSESSMENT/IMPROVEMENT POLICY PAGE 6 assessment, written notice must be filed with the Council Prior to or at the assessment hearing. After the hearing, the assessment roll is adopted by the Council. The property owners have a 30 day period in which to pay their assessment in part or in full at the City Hall, interest free. After this period, the assessment begins to accumulate interest. On or about October 10th of each year, the assessment roll is certified to the County Auditor's office where it is added to the tax roll for the following year. The assessment shall be levied over a period to be established by the City Council, in equal annual installments on the principal with interest on the declining balance. The annual interest rate shall also be established by the City Council upon the sale of the improvement bonds. SECTION IV CONSTRUCTION STANDARDS AND EXPECTED LIFE Minimum Design Standards The following are minimum design standards. Over sizing may be required to serve areas extending beyond the scope of the project as determined by the City Engineer. A. Sanitary Sewer Laterals Minimum 8" PVC (SDR35) or DIP (CL52). Manholes a maximum 400' apart. 0 C. I� Sanitary Sewer Services Minimum 4' PVC (SDR35) or (CISP). Water Main Lateral Minimum 6" loop or Water Main Services 8" deadend DIP (CL52). 1. Single Family Residences - Minimum 1" Type K copper. 2. Multiple Family Residences To be determined by City Engineer based on Minnesota State Plumbing Code. 3. Commercial/Industrial - To be determined by City Engineer based on Minnesota State Plumbing Code. E. F. ASSESSMENT/IMPROVEMENT POLICY PAGE 7 Storm Sewer System Pipe size shall be designed to handle a 10 year event and pond shall be designed to handle a 100 year event as determined by the City Engineer. Sidewalks, Trails and Bikeways (to be added) G. Streets AG, AG -P and RR Zones - minimum 24' edge to edge, 4' gravel shoulders, rural ditch cross section and 7 ton pavement - or - minimum 28' back to back, urban cross section with bituminous curb and 7 ton pavement (no street parking). RL, R1 & R2 Zones - minimum 32' back to back, urban cross section, with concrete curb & gutter and 7 ton pavement. R-3 & R-4 Zones - minimum 37' back to back, urban cross section, with concrete curb & gutter and 7 - 9 ton pavement. Commercial Zones - 37' - 49' back to back, urban cross section, with concrete curb and gutter and 7 - 9 ton pavement. WM and Industrial Zone - 37' - 49' back to back, urban cross section, with concrete curb and gutter and 9 ton pavement. Public Zone - Churches, government offices and primary schools - 37' back to back, urban cross section, with concrete curb and gutter and 7 ton pavement; secondary and post -secondary schools: 49' back to back, urban cross section, with concrete curb and gutter and 9 ton pavement. Useful Service Life Public improvements are judged to have a normal useful life expectancy. For the purpose of this policy, this life expectancy shall be as follows: A. Surface Improvements Concrete Curb and Gutter 30 years Bituminous Roadways 20 years Sidewalks - Concrete 30 years Sidewalks - Bituminous 20 years ASSESSMENT/IMPROVEMENT POLICY PAGE 8 B. Subsurface Improvements Water Main 50 years Sanitary Sewer 50 years Storm Sewer 50 years When any existing improvement is ordered to be renewed or replaced, the assessments to be levied will be prorated from 0% at one-half like expectancy to 100% at full life expectancy as noted above or beyond. SECTION V PUBLIC IMPROVEMENTS IN NEW DEVELOPMENTS General Procedures and Policies City Code requires execution of a development contract at the time of land platting. The developer's agreement normally references means and methods of providing for public improvement construction. As a standard, the City of Rosemount has pursued policies by which all costs of improvement are directly attributable and fully paid by cost allocation or assessments against the development, developer or properties requiring and benefiting by the improvement. The policies are established with the intent that no developmental costs are incurred by existing lots or parcels, by the existing residents, or by the City in general. The exception is for improvements which are determined to have an area wide benefit which exceeds the scope of the development. At the time of platting, the cost responsibilities for any development for trunk improvements shall be defined. This responsibility includes trunk sanitary sewer facilities, trunk water facilities (including source, supply, storage and distribution components), storm water drainage and control facilities, arterial street, park dedication, pedestrian walkway systems and other public improvements, existing or proposed, of an area wide benefit. Normally the City will require a cash payment by the developer for the development's share of improvements for an area wide benefit. The amount to be determined by the City Council. At the time of platting, the development contract may provide details on construction and timing of local or lateral improvements of various nature for the benefit and improvement of the individual properties as required by the Rosemount Subdivision Ordinance. ASSESSMENT/IMPROVEMENT POLICY PAGE 9 City Improvement Financing and Construction As a general policy, the City of Rosemount will assist developers in the financing and construction of public improvements through authority granted to the City by Chapter 429 of Minnesota Statutes. Such assistance is granted by specific Council action for each development proposal based on perception by the Council of the project, viability, and development benefit to the City. The City may elect to sell bonds for such improvement and assess the costs of bond retirement against individual benefitted land parcels for a period of repayment 3-5 years or otherwise determined by Council. Typically, the total project costs for improvements benefiting the development will be assessed on an equal basis against all buildable lots in the development. For such City assessed developments and improvements, the City, through the development contract, requires a 60% down payment, a bond or letter of credit to protect the City from potential project default, and requires assessment payment concurrent with building permit issuance or per the assessment payment schedule whichever comes first. For such City assisted projects, the City provides design, construction supervision and assessment certificate, legal, fiscal and administrative services and charge costs for those services back to the project. Public Improvement Work by Private Developers No public improvements may take place before a development contract has been executed. A private developer may have his plans prepared by other than City forces under the following conditions: 1. All plans, drawings, specifications and related documents required shall be prepared by a professional engineer, registered in the State of Minnesota and approved by the City. 2. The developer must keep the City informed as to the time table of development and design, the letting date of a construction contract, and the starting date of construction work. 3. In order to warrant the construction for the life expectancy as previously set forth, the City will provide inspection of all phases of construction as set forth in the contract documents. ASSESSMENT/IMPROVEMENT POLICY PAGE 10 4. The City of Rosemount may perform construction surveys, staking and other engineering services when requested by the contractor or developer. The City will also assist the contractor in interpretation of the contract documents, ordinances, codes and other items necessary to meet the criteria as established by the City of Rosemount. 5. No public improvement work shall be performed by any developer or other private party in City right of way or easement unless a development contract has been executed and the final construction plans have been approved by the City. 6. The City will require a surety deposit of 100% of the estimated project costs in the form of cash, escrow deposit, certified check or irrevocable letter of credit. The City and its representatives shall at all times have access to the work in order to complete the services as herein provided, and the developer shall give the City timely notice of his readiness for inspections or other work to be rendered. Permits, licenses and easements or permanent changes in existing facilities shall be secured and paid for by the developer. The developer shall be charged for these services, and the value of the services shall be determined on a percentage basis as agreed upon by the developer and the City before the project is started. The fee for plan review and City administration is set annually by resolution of the City Council. All inspection costs will be billed on an hourly basis. Upon proper completion of sanitary sewers, storm sewers, water mains, curb and gutter, roadway base, surfacing and sidewalk by the developer, the City will accept said improvements by resolution under a two (2) year guarantee to the City. A. C. NO 1. ASSESSMENT/IMPROVEMENT POLICY PAGE 11 SECTION VI IMPROVEMENTS IN EXISTING DEVELOPMENTS (RECONSTRUCTION/REHABILITATION) Initiation Improvements may be initiated by petition or by Council as set out in Section III -1-A. Reconstruction and rehabilitation work proceeding under the terms of this policy shall provide for the standards set out in Section IV. F. Computation of Assessable Costs Property Cost Assessable Allocation - Assessable costs will be allocated to properties based upon their zoning designation at the time of the improvement. The "current" cost for constructing the improvement in Section IV. F. will be determined using actual bid prices for those units averaged over the previous two years as constructed by the City plus the last 12 months change in the ECI. Method of Assessment Basic Assessment Data a. Front Footage Assessment Most improvements are assessed according to the cost of the actual design standards implemented in the improvement project, based upon the lesser of the cost per front footage of the improvements abutting a parcel or the corresponding cost based upon the design criteria of the use identified in Section IV. b. Unit Assessments Some improvements may be assessed on a unit basis, rather than front footage basis. The unit basis is typically used in improvement projects affecting single family residential properties. It may also be used in single use developments, i.e. commercial parks, industrial parks, where land uses and development densities are similar. Unit assessments are generally determined by multiplying this equivalent design costs C. 0 ASSESSMENT/IMPROVEMENT POLICY PAGE 12 of the improvements by the requirements of a parcel, Ordinance. Adjusted Assessments minimum frontage as established in the Zoning Assessments may be adjusted due to public easements recorded on a parcel. Multiple Frontage Assessment Parcels with multiple frontage than one improvement project. assessments will be based upon connection to improvements that 2. Method for Determining Assessment a. Front Footage Assessment may be assessed for more Determination of the the actual access or abut the parcel. Assessments will be determined by utilizing the lessor of the actual front foot costs of the improvements abutting a parcel or the design criteria costs per front foot, as described in Section IV and Section VI. b. Unit Assessment 1) Multiple Land Use Improvement Projects Assessments will be determined by multiplying the design criteria costs per front foot by the minimum frontage of the parcel, as established in the Zoning Ordinance for improvement projects affecting mixed land uses. (RR lot width is 3001) 2) Single Land Use Improvement Projects Assessments will be determined by dividing the actual costs of the improvement project by the maximum number of benefitted parcels abutting the improvements, as determined by the Zoning Ordinance. Parcels that may be divided according to the provisions of the Zoning Ordinance and Sub - Division Ordinance, may receive multiple assessments units. ASSESSMENT/IMPROVEMENT POLICY PAGE 13 3. Method of Payment (Interest on the assessment will begin accruing from the date of the adoption of the assessment roll.) A schedule for the payments of special assessments will be determined by the City for each project. The payment schedule for projects in new developments will be set through a development contract but in no circumstances will those schedules be less than the following schedule(s) used for existing developments. The owner may pay the entire or partial amount of assessment within 30 days of adoption of the assessment roll without interest. The remaining amount shall be paid in equal principal installments (per the schedule in 6.a.) plus interest as determined by the Council (typically 2% above the net interest rate of the bond issue). Annual payments will be remitted with the property taxes. An owner may pay off the assessments in full at any time, but will be charged the entire year's interest. ASSESSMENT/IMPROVEMENT POLICY PAGE 14 SECTION VII ASSESSMENT DEFERMENT POLICY Deferment of Special Assessments A. Purpose - To determine in which instances the City may legally allow deferment of special assessments levied under this policy so as to not create undue hardship for property owners because of the project being assessed. B. Under Minnesota State Statutes 429.051, 529.061, 273.111 and 435.193 Cities may legally defer special assessments for the following reasons: 1. For Property covered under the Green Acres Law 2. Unimproved property until it is improved 3. Senior Citizen and low income deferments due to age and low income C. Based on these Statutes and the desire of the City to provide adequate street, sewer, water and stormwater systems to the City residents while not causing property owners undue hardships due to the construction of and assessment for these systems the following deferments will be available upon written request of the affected property owners: 1. Green Acres 2. Unimproved property 3. Senior Citizen/Low Income C(XISIM ------------------- Rmite YEAR STREET 1,1414 91 145111 ST. V1, SE IAN PK41Y 91 DIAMOND PA -111 144'171 ST 92 C11I1,I AVE N. END 92 145'Pll ST. W. MIR) AVE 92 CAMEO AVE: 1451'11 ST.W. 92 L.14TH 1 ST. vi. IMY 3 92 143RD ST.W. BWY 3 93 CAMEO AVE 93 14_`1111 ST. 41 94 160111 ST 94 160'1'11 ST 94 C11IPP. AVE 95 145'111 ST. W 95 DODD BLVD 95 AKRON AVE 96 145'1'11 ST. W. 97 WDD BLVD 143RD ST. SHAN PKWY APPLE VALLEY '111 3 151ST S'C.W. BISCAYNE AVE CTIIPP. AVE:. CSAII 42 CO. RD. 42 SHAN. . PKWY DELI'"1' AVE 4 0.53 2798 40 $585,900 ME STREL"1' RECONSIRUC"HON ----------- LINEAL PROP. TC11'AL MSA TO PRIORI,IILE:S FEET WWII[ C'OS'TS ASSESSIBLE CI'T'Y SHARE ELLIGIBLE DIA. PATI1 2 0.36 1901 40 $575,100 $503,1.00 1..311'1'11 5`1' .'i U . '1 3696 64 $214,000 $789,100 $555,000 145'PI1 ST. 2 0.2 1056 32 $48,892 01IPP. AVE 2 0.52. 2746 40 $585,900 L. 147111 ST.W. 3 0. 17 898 32 $83,117 CANADA AVE 3 0.24 1267 32 $1.17,341 $874,400 W.MD 6 0.1 528 32 $48,892 $884,142 145'111 ST 2 0.1'1 898 32 $83,117 C11IPP. AVE 4 0.48 2534 40 $941,308 $1,024,424 '111 3 2 1.0 5280 52 $945,000 $373,000 US HWY 52 4 5.0 26400 44 $331,000 $287,000 160111 ST.W. 6 0.9 4750 48 $373,000 $1,649,000 BRAZIL AVE 2 0.33 1742 40 $318,000 $426,000 SHAN. PKWY. 4 0.54 2851 40 $585,900 INVER GROVE IIGTS 8 2.5 13200 44 $647,712 $.1,551,612 BISCAYNE AVE. 2 0.38 2006 40 $461,000 DELI'"1' AVE 4 0.53 2798 40 $585,900 ME -------------------- S'I'RES"1' CAMBRIAN AVE UU.tARO I ANE: CIIARf,S'R)N AVE CIIAIANTI AVE: C11ILI AVE 1.46Tl1 ST.W. 146111 ST.W. L.147'i'I1 STM. 147'1'11 ST.W. U. 147'I'l l ST . W . 1.46111 ST.W. U..149'1'11 ST.W. L. 150111 ST.W. 1.43RD ST.W. 14,1111 ST.W. CIIORLLY AVE 147'171 S1'.1.1. 148'191 ST.W. 14 9'1'1 I S'C . W . U.149'I'LI ST.- 1-DALLARA AVE DALLARA AVE: DANVILLE AVE DI I&T AVE U. 145111 ST.W. U.145'I'11 ,;,r.W. U.148'I'li ST.W. 121ST ST. 1q. BURNLEY AVE; 1.147'1'11 fil'.VJ. 149'171 s'C.W. C1MARNON AVE: 146'1'11 ST.W. U . 14 8'1'11 S' l' . W . 14 9'1"11 ST.W. DP14ASK CT. 1_346,111 ST.W. 150'1'11 ST.W. Route F RU'l 1..14T171 ST. 1.1. CAh11iRlAN AVE 14 8'1'11 S111J.4 W 1.45'1'11 ST.W. L.1.47TH ST.W. BURNL.IY AVE CAr1E0 AVE CANADA AVE. CANADA AVE. CANADA AVE CANADA AVE CHARLSTON AVE. (ITIF IELD CIR. CI l [ LE: AVE C71I1.1 AVE U.148'111 ST.V1. C11IPP. AVE. CIEIPP AVE, C11IPP.AVE. CHORLI?Y AVE. 1.45'1'11 ST.W. DODD BLVD U.1.45'1'11 ST . W . 11.1.45'1'11 ST.W. DALLARA AVE DANVILLE AVE DEIFI' AVE AKRON AVE: 145'1'11 ST,W. BURMA AVE CANADA AVE 14151'11 ST.W. cilIPP. AVE. CHORLEY AVE CIIORLEY AVE N. END DANBURY AVE DALLARA AVE: '1'0 IMY 3 S. FIND 1_15011,11 S'1' . W . L .14 7'I'l 1 ST . W . 148'171 ST.W. 11WY 3 C11TPP. AVE CI111,1 AVE C1111'P. AVE C11IL1 AVE CHILI AVE C111 PP . AVE C11ARC.S1'ON AVE: C:I MMARON CIMMARON AVE: U .14 9'1'11 S'I'.w. CIMARRON AVE CIMARRON AVE 01ORLEY AVE C1MAI�I:ON AVE DODD BEND 150' 1'11 ,;,r . W . DODD BLVD DODD BLVD DAMASK AVE L)iLl:'t' AVE DIAMOND PATII WEST END 14Uri I ST. W. IEWY 3 CHARI.S'I'ON AVE U. 148171 ST.W. C L h11,1ARRON AVII-' (,'IMARRON AVE CHRYSLER AVE DODD BLVD DANVILLE AVE W.EN1) PRIORM I I -Es 4 0.25 4 0.19 4 0.13 4 0.14 4 0.18 4 0.1 4 0.38 4 0.21 4 0.24 4 0.21 4 0.21 4 0.15 4 0.1"6 4 0.21. 4 0.24 4 0.1 4 0.21 4 0.21. 4 0.04 ,£ 0.16 4 0.31 4 0.16 4 0.38 4 0.42 4 0.06 4 0.1.1 8 0.09 10 0.64 10 0.09 10 0.06 10 0.09 LO 0.16 10 0.2 10 0.17 1.0 0.1. 10 0..13 1.0 0.06 1.0 0.18 STRU(7rUAL. HAIHTl?NAHCE FI:EI' 1320 .100:3 686 739 950 528 2006 1109 1.267 1.1.09 11"09 792 845 1109 1.267 52.8 1109 11,09 211 845 1637 845 2006 2218 31.7 581. 475 337 9 475 3:1.'7 4'15 845 10:;6 898 528 686 31.'1 950 'I'OTA1, '1.1.3 37 G4 6 fXA'AL; 51.3 , 000.00 .,'11,000.00 $6,000.00 $6,000.00 $8,000.00 $6,000.00 e:18 , 000.00 $9,()00.00 $11,,000.00 $9,000.00 $9,000.00 $7,000.00 $7,000.00 $9,000.00 $1.1,000.00 $ 'I , 000.00 $9,000.00 $9,000.00 $2,000.00 $7,000.00 $14,000.00 $7,000.00 $15,000.00 $17,000.00 $2,000.00 $4,000.00 $4,000.00 $? 4 , 000.00 $4,000.00 -;'1'000.00 $1,000.00 $7,000.00 $9,000.00 $-7,000.00 $4,000.00 $5,000.00 $2,000.00 $7,000.00 $31.1,000.00 Exhfbi+ "C Five Year Street Reconstruction Program Estimated Cost of Reconstruction $5,700,000 over 5 years Estimated Cost of Maintenance/Overlays $ 300,000 over 5 years Sources of Revenue 1. Assessments 2. MSA Funds 3. CIP 4. General Tax Levy Concert Develop five year, ongoing, street reconstruction program to reconstruct amaintain city streets. Initially this program would cover years 1991 - 1995. Each year this program would be reviewed and upgraded to add next year. In order to fund this general reconstruction/maintenance program it is necessary to look at sources of funding in broader sense than on a project by project basis. It is necessary to consider "pooling" of all available sources so that a "financing progran." can be generated. These sources would be: 1. Assessments - under the proposed assessment policy a portion of all construction costs, will be assessed. The percentage of individual project costs to be assessed will typically be %, but could range from a low of 50% to a high of 100% depending on what type of street it is and how many abutting properties have access to the street, the type of development occurring, etc.. Generally if the street is larger than a residential street MSA Funds offset city costs. (Those not collected through assessments.) 2. MSA Funds are available to the city through the State of Minnesota from the MVET Fund. There is no indication now that those funds are in any great extent, in jeopardy. on some projects the amount of dollars that the city can receive for -reconstruction -of an MSA designated street is almost 100% of the cost. The city receives a maximum amount per year from MSA Funds even if our costs are greater. We don't lose those funds which are not covered in a single year but we must wait for our allocation to be great enough to cover those costs. In 1991 our construction allocation for MSA is about $300,000 per year. This amount would expand as the number of street miles that are eligible increases. What many cities do is to develop a 5 year reconstruction plan and borrow against their MSA allocation. That is, say borrow money to fund large projects which have to be done before MSA Funds are available and use their allocation as it comes in to pay off the debt. This is actually quite a common and a good approach if you have a "Street Reconstruction Program" in place. 3. CIP. As part of a reconstruction and maintenance program it is appropriate to set aside, as part of a 5 year CIP Program, monies for general overlay and maintenance. This is simply part of the General Fund but funds specifically designated for the Street Reconstruction Program. In fact, the Street Reconstruction Program, should be just one part of an overall 5 year CIP Program for the city and the "General Tax" contribution would be part Of it. The specific dollar amount to be designated in the CIP would vary depending on the overall needs. 4. General Tar. Levy. Funds made available through general taxes could be provided in a couple of ways. a. In a five year street reconstruction program as we borrow money to pay for projects a certain portion of that debt could be calculated as "General Fund" debt, and, if the levy needed to pay for that debt is greater than the assessments available, the general tax base would support that debt. b. Through a CIP Program, as noted in No. 3 above, the general taxes used to help finance a program would compete with other uses of our tax levy. 2 Example: YEAR RTiC ONSrRUCIIQN MAIN M-NANM- WTAL 1991 S 800.000 S 60.000 S 86,0.000 1992 800.000 60.000 860.000 1993 1,000.000 60,000 1.060,000 1993 1.600.000 60.000 1,660,000 1995 1.500,000 60.000 1560.000 Total Cost 55,700,000 S 300.000 56,000,000 Revenues 1. Assessments - Assume average of 50% of Reconstruction cost would be assessable. 50% X $5,700,000 = $2,850,000 Typically assessments would be spread for seven years in these issues. 2. MSP. - Based on the projects now projected for complete reconstruction over the next 5 years it is calculated that $3,000,000 would be MSA Fundable. Since our MSA allocation is only $300,000 per year we could either use that $300,000 per year to offset that amount of debt to incur or borrow against this allocation up front and utilize our allocation to pay off that debt. 3. General Tax/CIP - The shortfall created between the total needed and those dollars available in No. 1 and 2 above would have to be picked up through general taxes either through a debt levy or general tax levy and funding the CIP. Assume: _1991, 1992, 1993 $2,780,000 in cost MSA Allocation (900,000) $1,880,000 CIP Funding 300,000 (100,000 per yr.) $1,580,000 DEBT NEEDED Issue $1,600,000 in Bond At 8% for 7 Yrs. in 1991 Annual debt payment $ 299,255 Assume 50% Assessments 260,000 Increase in Debt Levy 40,000 (rounded) 3 B. 1994, 1995 $3,220,000 in cost MSA Allocation { 600.000 $2,620,000 CIP Funding 300,000 (150,000 per yr.) $2,320,000 DEBT NEEDED Issue $2,325,000 in Bonds at 8% for seven years in 1994 Annual debt payment $ 434,855 Assume 50% Assessable 301,125 Increase in Debt Levy 134,000 (rounded) 41 This example shows what two debt issues over a five year period would cause as an increase in debt services levy. The amount of $174,000 is equal to about a 2% increase in the city's portion of our tax levy. Typical Assessment Assume a 80 foot frontage residential street lot. Assume residential equivalent front footage cost equals $40. Percentage Assessed Assessment Amount i00-1. $.200 90% 2880 8Q% 2560 50 % 1600 40% 1280 300 960 20 % 640 i0% 320 RESIDENTIAL STREET EQUIVALENT ESTIMATE The quantities listed below are for a 500' length of residential street, 32' wide bituminous, including lateral storm drain and street lights Item Quantity Units Unit Price Total 1. Soil Correction 2000 C. Y.- $ 4 $8,000 2. 6" Class 5 Aggregate 600 Ton $ 5 $3,000 3. 112" 2331 Bitum. Base 135 Ton $ 17 $2,295 4. 112" 2341 Bituminous 135 Ton $ 19 $2,565 Wear Course 5. Concrete Curb & Gutter 1000 L.F. $ 5 $5,000 6. Restoration 1 L.S. $3500 $3,500 7. Street Light 1 Each $1800 $1,800 8. Catch Basins 2 Each $ 800 $1,600 9. Manhole 1 Each $1000 $1,000 10. RC Pipe 250 L.F. $ 23 $5,750 TOTAL CONSTRUCTION ....................... $34,510 10% CONTINGENCY .......................... 3,450 SUBTOTAL ................................. $37,960 PLUS 10% ADMINISTRATION .................. 11,390 TOTAL .................................... $49,350 $49,350 divided by 500 L.F. = $98.70 per foot of street. $ 98.70 divided by 2 sides = $49.35 per assessable foot. Equivalent residential street assessment = $49.35 per foot for all items. Street only = $34.85 per assessable foot (items 1-6) Storm drain only = $11.95 per assessable foot (items 8-10) Street light only = $ 2.57 per assessable foot (item 7)