041295 CC WS AgP
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NOTICE
The Shorewood City Council will meet:
Wednesday, April 12, 1995
beginning at 7 :00 p.m.
in Work Session Format
in the City Hall Council Chambers at
5755 Country Club Road
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The purpose of the meeting is to discuss revisions to the 1995-1999
Capital Improvement Plan and special assessment policies.
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Meetings of the City Council are open to the public.
James C. Hurm,
t City Administrator/Clerk
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Handout #1
Handout #2
Handout #3
Handout #4
Staff Agenda
Shorewood City Council Work Session
Wednesday, April 12, 1995 7:00 p.m.
Introduction - Jim Hurm
1991 Newsletter $13 Mil System
1995 Comprehensive Plan Update - Review Phases
1/19 Memo - Sources of Revenue to Pay Costs
Chart of New Developments - Identify on Maps
Financial Projections (Assumptions) - Al Rolek
Handout #5
Handout #6
Handout #7
Review Projections Without Minnewashta Property
Engineering - Joel Dresel
Technical Aspects of System
Feasibility Report Status
Planning - Brad Nielsen
Review Proposed Developments (Planner's Reports)
Discuss Policies - 3/27 Memo & Questions Raised by
Proposals
Discussion
Ending Handout - Proposed Ordinance
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CITY OF SHOREWOOD
RESOLUTION NO. #95-29
A RESOLUTION SETTING PARAMETERS
WATER SYSTEM ASSESSMENT POLICY
FOR A
PROJECT
WHEREAS, the City Comprehensive Plan calls for a
three-phased expansion of the municipal water system; and
WHEREAS, said expansion includes the following
objectives:
1. Extend watermain to new developments where feasible.
2. Enhance the safety and reliability of the existing
system on the west end, and throughout the City.
3. Construct a water tower on the Minnewashta Elementary
School site in order to establish the elevated storage
crucial to objective #2.
4. Establish fees for developments where extensions of the
system are not imminent.
5. Evaluate and adopt an assessment policy which:
. Addresses assessment of property as service is
provided.
. Takes into consideration the City's ability to
finance said assessments in order to mitigate
the financial burden to existing homeowners.
. Determines at what point connection to the
system may be required, or as an alternative, at
what point minimum charges begin accruing.
. Budgets for capital improvements.
. Establishes flat rate assessments on a unit
basis (i.e. all lots regardless of size pay the
same assessment); and
WHEREAS, many, but not all, assessment policy
questions are addressed in the Comprehensive Plan and the
proposed street reconstruction assessment ordinance; and
WHEREAS, the City 'Council wishes to establish a
thorough Water System Assessment Policy.
RESOLUTION #95-~
Page .2 of 3
NOW, THEREFORE BE IT RESOLVED by the City
Council of the City of Shorewood that a temporary Water
System Special Assessment Advisory Group is created to work
with the City Council in developing a thorough water system
assessment policy which shall operate within the following
parameters:
Purpose of Advisory Group: The group shall review
and make recommendations on policy questions being
considered by the City Council regarding water system
special assessment and financing policy questions.
Objectives: The Advisory Group shall work with the
City Council by commenting on alternative formulas for
special assessments as well as alternative formulas
for financing said assessments taking into
consideration:
· Total project costs;
· Current and future financial strength of the
City's General Fund and Water Fund;
· Equitable assessment of costs (i.e. discounts
for senior citizens, low income families,
existing homeowners versus new development,
etc.); and
· Funding for deferred maintenance
(depreciation) .
The Advisory Group shall work with the City Council in
reviewing financial projections prepared by the staff
and consultants, and make comments and recommendations
to the City Council.
Committee Make-up: The City Council shall act as a
Committee of the Whole in conjunction with an Advisory
Group of citizens made up of one person from each of
the four areas of the City as defined for the
Comprehensive Plan neighborhood meetings if possible.
The City Administrator, Finance Director and City
Engineer shall be non-voting members and provide staff
support.
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RESOLUTION #95-~
Page 3 of 3
Procedure: Meetings shall be set by the City
Council. The City Administrator will send a notice of
the time and place of the meeting, and an agenda to
the Advisory Group. Notice will be posted at regular
locations and mailed to the press at least 72 hours in
advance of the meeting.
Sunset: The mission of the Advisory Group shall be
completed and shall cease to exist on June 30, 1995.
The City Council may expand the purpose or the life of
the Group by Council resolution.
PASSED AND ADOPTED by the City Council of the
City of Shorewood this 10th day of April, 1995.
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ATTEST:
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James C. Hurm,
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k.~U-\_t-?r?J__i.cL..._
Robert B. Bean, Mayor
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City Administrator
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OCTOBER, 1991
MAYOR
Barb Brancel
COUNCI L
Kristi Stover
Bob Gagne
Rob DaughertY
Daniel Lewis
CITY OF
SHOREWOOD
5755 COUNTRY CLUB ROAD · SHOREWOOD, MINNESOTA 55331 . (612) 474-3236
TO: Shorewood Residents
SUBJECT: Considering Expansion of the Municipal Water System
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Over the last several months the Shorewood City Council has been considering whether to
construct a complete municipal water system for the City. This letter is intended to explain
the reasons why the water system expansion is even being considered; to report on the status
of the current municipal water system; to describe what is being proposed; to share with the
Shorewood citizens the various considerations in making such a decision; and to describe
avenues of public input.
Why is a Water System EXDansion Heinl: Considered at this Time?
Although the Shorewood City Council is responsible for only eighteen cents of your property
tax dollar, the Council wants to be sure that that eighteen cents is spent well. Public
improvement projects need to be timed and financed carefully to minimize the impact on
property taxes.
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To do this the Council is developing a Capital Improvement Program (CIP). The CIP
identifies public improvements projects to be done over the next 20 to 25 years, plans and
schedules them over the next 5 years, and budgets for those projects planned in 1992.
Water, sanitary sewer, parks, drainage, and public facilities are being reviewed along with
public works equipment. A summary of the CIP was published in Shorewood's Fall
Newsletter. The CIP will be reviewed and updated each year.
During review of the status of the current City water system and condition of City streets,
the question of expanding the water system was raised. A simple but important point to
keep in mind during this planning process is to be sure that all likely underground
improvements are installed before a street is rebuilt. Thinking ahead makes sense!
Financial planning saves dollars!
The Current Municipal Water System
Shorewood's existing municipal water system consists of seven wells, four hydro-pneumatic
tanks for pressure regulation without storage, and one elevated storage tank. The system
is not currently interconnected, and consists essentially of five different service areas.
The southeast service area is the most operationally viable. With a 400,000 gallon elevated
storage tank and a connection to the Minnetonka and Chanhassen water systems, a water
outage is unlikely. Water treatment for iron removal is currently under construction and
is scheduled for completion in late 1991.
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The wells for the remaining four service areas are located in Badger Park (serving the area
near City Hall), Amesbury (in the northeast portion of town), Boulder Bridge (serving the
western part of town including Shorewood Oaks), and the W oodhaven well serving an area
along Apple Road. Of these, only the Badger Park system has a backup, with a connection
to Tonka Bay's elevated storage.
The City's water system currently serves approximately 30 percent of the households within
the City. Because the water system actually consists of five separate sub-systems, and
because some of the systems are under-utilized, the system as a whole has been very
inefficient fmancially. During the 1980's, the water fund ran up a deficit which, at its worst,
totaled $243,000; this deficit has been financed by the City's general operating fund reserves.
With a greater number of users being added onto the system, and with the addition of an
efficient system in the southeast area, the water fund has made a comeback of sorts in 1989
and 1990.
During that period, for the first time in years, the deficit was reduced. However, at the end
of 1990 there still was a fund deficit of over $200,000. These figures also ignore the cost of
long-term maintenance to the system for which funds should be set aside each year.
Because of the tenuous financial position of the water fund, the setting aside of such funds
has not been possible.
The financial figures of the last two years seem to show encouraging signs for the financial
integrity of the water fund. Projections show that, in the short-term, the water fund will
climb out of its current deficit by 1997. These projections, however, still do not consider
long-term'maintenance costs. When long-term maintenance costs are considered projections
show that, even with modest growth in users and significant increases in water rates, the
water fund deficit will continue and actually grow. This would result in the general
operating fund continuing to finance the operations of the water fund.
So, with the Council currently planning for future improvements, with many streets in the
position of needing improvement, and with the poor long-term financial outlook of our
current water system, the Council is now considering expansion of the municipal water
system City-wide.
THE PROPOSED WATER SYSTEM
Expanding the municipal water system to encompass the entire City (except for the islands)
is an expensive proposition. It is estimated to cost 13 million dollars over a three year'
period. Two-thirds of the estimated cost would be assessed on a per unit basis to those
units not currently hooked up to municipal water. Because the system will have many more
paying customers, it is anticipated that the remaining one-third of the total cost will be
picked up by system revenues and by future connection charges as new structures are built.
Those already connected to or who have been assessed for municipal water will not pay any
assessments for this improvement. Again, it should be noted that those living on Enchanted
and Shady Islands are not directly affected by this proposal. Assessments would pay for
installation and future system improvements and are estimated to be:
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· $800 assessment per affected unit, spread over 15 years beginning in 1993, for
trunk main and storage:
Payments at 8% interest on the unpaid balance would decline as shown by this
illustration using years 1, 8, and 15.
Interest on Unpaid
Principal Balance Total Payment
Year 1 $ 53.33 $ 64.00 $117.33
Year 8 53.33 34.13 87.46
Year 15 53.33 4.27 57.65
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· An additional $4,000 assessment per affected unit spread over 15 years, beginning
when water is available to the property, for watermain (lateral) installation:
Payments at 8% interest on the unpaid balance would decline as shown by this
illustration using years 1, 8, and 15.
Interest on Unpaid
Principal Balance Total Payment
Year 1 $266.67 $320.00 $586.67
Year 8 266.67 . 170.67 437.34
Year 15 266.67 21.33 287.95
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These assessment costs do not include plumbing costs to bring water from the property line
to the structure and hook it up.
The proposal is being developed under the following City Council policy guidelines:
· Total assessment is estimated at this time to be $4,800 per unit for one and two
unit dwellings. Apartment buildings over 2 units would receive a "combined
service" reduction while commercial units would be increased by a multiplier.
· Those who have municipal water available now and have not paid a special
assessment, can connect by October 1, 1992 by paying $4,000, or connect after
that date by paying $4,800 plus a Consumer Price Index (CPI) annual adjustment.
· To lessen the financial impact, special assessments will be spread over a 15 year
period with as low an interest rate as possible.
· Each buildable lot of record will be assessed a minimum of one unit.
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· The proposal is as "development neutral" as possible. The Council is concerned
that significant water assessments on large undivided parcels would force owners
to subdivide and sell lots sooner than would otherwise be the case. Large tracts
of land will be charged as only one unit until they are subdivided at which time
hookup charges would become due and payable. Those properties which are
subdivided in the future will pay a greater cost. Subdivided parcels adjacent to
watermain will have to pay a $2,500 water access charge plus a $4,000 hookup
charge (adjusted for CPI). Parcels resulting from an "internal" subdivision, which
are not adjacent to the watermain system, will have to pay the $2,500 water
access charge plus the cost of installing all mains to service those parcels. This
should counter balance the tendency of the availability of City water to encourage
development.
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· In order to keep a financially viable system with rate increases kept at the rate
of inflation starting in 1993, it appears all properties will eventually have to
hookup to the system. The current proposal would require hookup within five
years of when water is available.
· Individual wells should be able to be kept for outside watering as long as they are
not interconnected to the municipal system.
· Services to property lines for future lots will be installed at the time of main
installation to prevent pavement disturbance in the future.
· A procedure will be established for deferral of assessments for low income
homeowners to mitigate undue hardship.
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CONSIDERATIONS IN MAKING A DECISION
The City Council is considering many issues and concerns in shaping a course of action for
the City regarding our municipal water supply. There are a number of points which need
to be taken into consideration in making a good public policy decision.
First there are considerations of City-wide significance:
· A City utility should be financially sound. It should have enough users to make
its operations cost-effective. Shorewood's water utility has not evolved over the
years as had been anticipated. Deficits that have been run up over many years
have made it necessary to subsidize the water utility fund operations and debt
service through general property taxes.
· A complete system would provide water even during power outages for a period
of time, whereas individual wells or a system not connected to an elevated tower
do not function during a power outage.
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· We have recently become eligible for State aid funds to help rebuild some of our
roads. It is the City's intent, if City-wide water is desired in the near future, to
use these funds in rebuilding the roadway after watermain placement. Since the
funds can only be used once for the life of the surface on each roadway, it is
important to be careful to not use the funds and then decide to install water five
or ten years from now.
· The City roadway system will definitely be in a state of disrepair during
watermain construction. While it will be a construction priority to keep the
streets open for travel, some inconvenience will be encountered with regard to
mud, potholes, and detours. Public Safety Departments will have to be kept
notified of road status so that Police and Fire Protection can be maintained at all
times.
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· A complete system provides for "looping" of the water mains. Looping is simply
a means for providing more than one path for water to reach a specific service.
This will allow continuous service with one portion down for maintenance; allow
supply from two directions during a fire; increase operating pressure by reducing
friction loss; and eliminate stagnant water in dead end pipes.
· It seems inevitable that eventually all buildable property in Shorewood will be
developed, however, the rate at which it gets developed may be influenced by the
availability of municipal water. Recent experience shows that the availability of
water is an important factor in a developer's site selection process and that
developer's are willing to pay for it. Two examples illustrate:
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1) Shorewood Oaks - the developer extended approximately .9 miles of trunk
main to serve his project, resulting in water service costs in excess of $6,000
per lot.
2) Near Mountain - approved in the late 70's, the project was started in
Chanhassen because City water was available. The Shorewood portion of the
project did not start until the water issue was resolved for the southeast area.
· The Metropolitan Council is currently investigating water supply issues in the
metropolitan area. According to the Council's water-planning team head, the
Metropolitan Council plans to be more involved in water planning issues in the
future. We should have our own plans completed prior to metropolitan wide
involvement to be sure that our needs are met. It should be noted that there
already is a metropolitan wide sewer system in place in Shorewood.
· A complete system provides a way to more closely monitor our domestic water
use. This would provide data en what portion of our sewage flow is actually from
domestic use, and help us to pinpoint areas of excessive groundwater infiltration
and surface water inflow into our sanitary sewer system. Ultimately, this would
help us reduce our sanitary sewer rates.
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Each citizen will view these points differently. Some points will be considered in a positive
way, others in a negative way. Some considerations of particular interest to those who are
currently not on the municipal water system are as follows:
· Cost - the program is designed to minimize "sticker shock" by having utility
revenue pick up one-third of the actual cost and allowing assessments to be paid
over 15 years. The fact remains that it is expensive...an estimated $4,800 plus the
cost of bringing the water into the unit. With this, however, we need to keep in
mind that private wells are also expensive. With a private well, besides the initial
cost of installation, ongoing major and minor maintenance, as well as individual
well replacement cost do not stop. When the municipal system special assessment
is paid off any further expenditures should be covered by system revenues.
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With a municipal water system there. will be quarterly water bills. The City's
charges for water are based on household usage, and averages $37.60 in a typical
winter quarter. This amount may be more or less, depending on usage, and may
increase with seasonal water usage, ie. lawn watering.
This should be considered alongside:
· The cost of a private well pump (1.5 horsepower) which could run two to six
hours per day, depending on usage... Example:
2 hours/day X 16 cents/kilowatt hour = 32 cents day
. times 365 days
equals $117/year
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· The resulting improvement in our ISO (Insurance Services Office) rating from
class 9 to class 6 with a municipal water system could, depending on the
insurance company, reduce insurance premiums. Fire Marshal Neudahl
surveyed several insurance companies with the following results:
Value of Home
Range of Annual
Premium Savings
$ 80,000
$120,000
$150,000
$250,000
$ 64 - $ 97
$106 - $173
$132 - $217
$376 - $398
Each property owner should check with their insurance carrier to see what, if any premium
savings would result.
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· There are health benefits associated with the chlorination and fluoridation of
water, and both are currently done with our existing wells. Chlorine is widely
recognized and used as a disinfectant. Fluoride has been established as helpful
in the development of teeth free from decay.
· Some people simply prefer water from a private well to water from a City system.
· Because of water quality, quantity, or cost, sometimes neighbors get together to
petition for municipal water. Scattered petitions for municipal water can result
in neighborhood conflicts and significantly varying costs for installation of
municipal water. Some petitions may have to be refused due to the lack of
capacity of the current system.
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· There are "economies of scale" associated with installing an entire system over a
three year period which is not likely to be there if petitions are received to install
water in various neighborhoods and the City undertakes those small projects in
a piecemeal fashion.
· There can be peace of mind knowing the Fire Department can hookup to a
reliable fire hydrant nearby. Fire Marshal Neudahl explains: "If we have no
hydrants we must use a tanker water supply system which takes longer to set up
and once the tanker is empty drive to the nearest supply of water, usually the
closest hydrant, to refill and return t.o the scene".
· There is more and more concern in the State Department of Health fot potential
contamination of individual wells.
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Considerations of particular interest for those citizens already served by municipal water are
as follows:
· Unless the water system is expanded significant rate increases are inevitable in
the future to reasonably account for system maintenance and depreciation.
Projections of high water rates will be held down by the increased number of
users in a complete system.
· Currently, four of the five water systems in the City use a hydro-pneumatic tank
to maintain system pressure. These systems are very much like a single home
well/pressure tank system, and therefore are just as vulnerable to power outages.
Also, the constant on-off cycles required of the large motors involved is energy
inefficient, and results in expensive repairs and increased maintenance costs.
· Three of the five systems have no backup to prevent water outage in case of
power failure which causes concern for fire protection.
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Public Input
At this time a majority of the City Council feels the proposal for the construction of a
complete municipal water system has merit. The Fall City Newsletter and this letter are
intended to inform the general public on the issue. But what are the avenues for public
input?
In this representative democracy your elected City Council is responsible for making such
decisions. They are interested in your thoughts. The following are methods of
communicating your thoughts to the City Council:
· Write your thoughts in a letter to the City Council in care of City Hall, 5755
Country Club Road, Shorewood, MN 55331.
· Call or stop them on the street to voice your opinions.
· A professional research firm will be conducting a public opinion telephone poll
on the issue within the next week. If you are called please spend a few minutes
with the poller offering your opinions.
· A public information meeting on the proposal for municipal water will be held:
Monday, November 4, 1991
7:30 pm
Multi-Purpose Room/Gym
Minnewashta Elementary School
26350 Smithtown Road
Shorewood
· A second public information meeting will be held on the other elements of the
Capital Improvement Program (sewer, drainage, streets, public buildings, etc.).
Comments on the water proposal will be heard at this meeting as well, at the
same location on Monday, November 18, 1991 at 7:30 pm.
. A public hearing on the Capital Improvement Program will be held before the
Planning Commission, at the same location on Tuesday, November 19, 1991 at
7:30 pm.
· If the City Council adopts the CIP with a water system expansion included, each
affected property owner will be invited to a public hearing on the proposed
improvement. During or after installation of the improvement a final public
hearing will be held on the proposed assessment for affected property owners.
Your input will be greatly appreciated.
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COMPREHENSIVE PLAN
1992
Municipal Water
Shorewood's municipal water system consists of five separate systems as shown on the following
page. Approximately 35 percent of the households in Shorewood are connected to the system. In
1984 the City prepared a Comprehensive Water Study to serve as a guide for the development of
an overall system. The Study was updated in 1990, at which time the City considered extending
water throughout the community over a three-year period. Based upon a survey and public
meetings conducted in 1991, the City Council determined that the majority of Shorewood residents
did not support such an aggressive approach to the construction of a city-wide system.
Since then the City has explored the possibility of selling or turning over to other cities parts of the
system which operate at a deficit, particularly the Badger and W oodhaven systems. While
discussions continue with Tonka Bay regarding the Badger system, it appears that this alternative
is not fmancially feasible for the Woodhaven system. Consequently, the direction at this time is to
concentrate on making the existing system as reliable and fmancially viable as possible by
inc~easing the number of users on the system. The City must identify how the system should be
upgraded and the extent to which it can be expanded over a reasonable period of time.
It is important to review the City's current policies on water system expansion.
1. Anyone can get water from any available source (i.e. private wells, small centralized
systems, connection to adjoining community system, connection to an existing Shorewood
system or extension of an existing Shorewood system).
2. With the exception of commercial (nonresidential) and multiple-family residential
properties, no one will be required to connect to, or pay for, City water.
3. Anyone may extend and connect to City water, provided those who want it are willing to
pay 100 percent of the cost.
4. Unless previously assessed, properties connecting to the existing system must pay a
connection charge (currently $4000). Credit is allowed (currently up to $2000) where
trunk or lateral lines must be extended.
While these policies have served adequately for new development, they have presented problems
when applied to requests for extensions to existing residential areas. For example, if in a
neighborhood of 12 homes, three property owners oppose the extension, the remaining nine
property owners must pay the total cost of the project. The other three pay a connection fee to the
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City at such time as they choose to connect to the system. Policies such as these run counter to
expanding the number of connections to the system.
It is recommended that the City develop a ten-year plan for expansion of the municipal water
system. The plan should be based on the following objectives:
Short Term Objectives
A water system analysis should be undertaken to accurately determine the limits and
capacities of the current independent systems.
Provide a reliable source of water for tire suppression in areas where the municipal system
exists.
Enhance the financial viability of the system on the west side of the City, and make that
system more reliable by providing elevated storage capacity.
In that provision of affordable senior housing is a priority goal of the City, municipal water
should be made available to make a senior housing project more viable.
Finance elevated storage on the west end by means of private development connection fees,
use of tax increment fmancing in conjunction with a senior housing project, and other
funding sources.
6. Coordinate municipal state aid and local road improvements with any water main
construction projects. Rebuild roads with water main extensions or with plans to
accommodate water main extension.
Lon~ Range Objectives
1 . All municipal water systems should be interconnected, forming one system to provide
multiple sources of water.
2. Examine ways to realize a multiple jurisdiction water utility district for efficiency purposes.
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Establish a depreciation fund to provide for system replacement.
4. Provide water service to as many residents as is feasible.
It must be realized that providing water service to the entire city is unrealistic. For example, it is
extremely unlikely that water service would ever be provided to Shady and Enchanted Islands.
Similarly there may be other portions of the city which are so expensive to serve that extensions
would not be made to those areas until well into the future, if ever.
Following is an outline of how a 1 a-year plan for expansion of the city water system might be
phased.
First Phase (Approximately Three Years)
· Formally adopt a policy that all extensions shall be consistent with the City's
Comprehensive Water Study, dated July 1990, and the Great Lakes Upper Mississippi
Board of State Public Health and Environment Managers ("Ten States Standards").
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Prepare an analysis of the existing system to determine the capacity of the five water
~ystems and establish potential service areas. Order a feasibility study for initial
Improvements for the west end of the City.
Evaluate and adopt an assessment policy which:
- Addresses assessment of property as service is provided.
- Detennines at what point connection to the system may be required, or as an
alternative, at what point minimum charges begin accruing.
- Budgets for capital improvements in the general fund.
- Establishes flat rate assessments on a unit basis (i.e. all lots, regardless of size, pay
the same assessment). .
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Establish impact fees for developments where extension of the system is not imminent.
Construct a water tower on the Minnewashta Elementary School site. This tower is
necessary to enhance the safety and reliability of the existing system on the west end
,and to provide water to new developments.
· Extend water main to new development where feasible. Where water main is not
immediately available consider provisions for future connection, such as dry pipes,
extra right-of-way width, etc..
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· Extend water main to low cost, high return areas, that is, where the most properties can
be served with the least amount of pipe.
Second Phase (Approximately Three years)
· Interconnect the west end of the system with the Victoria water system in conjunction
with development of the southernmost parcel in Shorewood east of Smithtown Road.
· Extend water main to connect the Amesbury system to the southeast area system.
· Extend water main to connect the Boulder Bridge system to the Badger system.
· Continue extending water main to low cost, high return areas.
· Identify low feasibility areas where costs are high relative to the number of potential
users.
. Third Phase (Approximately Four Years or More)
· Extend water main, as is economically feasible, to residential areas not served in the
first two phases.
· Construct west end water treatment as needed.
· Upon financial stability of water fund, extend water to higher cost, low return areas.
It should be noted that water main extensions will be made upon request in all phases of the plan,
based upon feasibility.
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From:
James C. Hurrn, City Administrator
t
To:
Mayor & City Council
Date:
January 19/ 1995
Re:
Impact of Building a Water Tower & Hooking Up 3 New
Developments on the West Side
The attached map illustrates where a water tower would go
(estimated cost of $850,000), and what water lines would need
to be installed to serve 3 proposed developments.
The chart "New Development/Expenditures" identifies and
explains water related expenditures for each of three
proposed developments (#1, 2 and 3 on the map). It proposes
$9,000 per lot be assessed the developers.
The "Water Tower Revenue Bond PaYment Schedule" shows what
4It annual paYments might be on a $1.13 million bond issue.
Those annual paYments are then used on the chart "Water Tower
Revenue Bond Cash Flow". The projections on this chart are
conservative. For example the "Increase Cash Flow" line is
basically projected "profit", before depreciation, or added
cash on hand. Further assumptions are explained on the
bottom of the chart. The bottom line is this bond issue can
be paid for out of the water fund under this scenario. The
water fund however will be "drained"!
Hopefully this scenario will serve as a base for you to make
decisions. There are many other potential sources of revenue
not being utilized here.
4It
. Charge current west side water users a tower fee of up
to $1,000 (about $150,000);
. Charge those along current lines on the west side who
are not hooked up to City water a water access charge
which would then reduce the hookup fee upon hookup (est.
35 x $500 = $17/500);
. Add a $1,000 "tower fee" to the hookup fee when those
who have no water available are hooked up to water (est.
155 x $1,000 = $155,000 long term);
. Increase water rates;
. General Fund contribution;
,
'<
.
.
~
~
· Capital Fund (street fund could be tapped in that some
streets will need restoration) ;
.' Special utility fee (i.e. dry hydrant fee on islands);
· Liquor/other funds;
· TIF district to bring water to a senior project;
· Assess property owners whose property the new lines go
by (25 est. x $5,000 = $125,000).
I.
.
.
~ III
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~ - .. ~ Ji!i .=I.t ~W~
:ED. fI):E :E
Eslfmate 1# of Potential
1 Units In Development 19 30 15 4/2 5/2 19/2 64 -90 4 (2 times) 64-90
2 Main Size 8" 16" 8" 16" 16" 8" 12" 12" 12"
Dlslance In Feet to Bring
3 Waler to the Site 2.400' 1 600' 1.200' 3.200' 1 000' 1.900' 1,400' 1.300' 3,700'
Howards Pt . Smlthtown -
4 Street Edaewood Smlthtown Smlthtown Smlthtown Smlthtown Eureka Hwv 7 Manitou Eureka
Cost of Bringing Waler
5 10 Ihe Site $ 70,600 82.400 35 300 164 800 51.500 55 900 55.600 52 000 151.700
City Share of Lines
6 Within Plat (Overslzlng) - 30.000 - - - - - - -
4 single,
N of Lots that can be 18 apts, 18
7 Assessed Along the Way 19 12 4 28 14 12 2 units .(duplex) 26
Cosl Estimate to restore
Street (Include In
8 Eslfmate 1#3) $ 27 300 18 200 13.600 36 400 11,400 21.600 16 000 15,000 42,100
Cost Estimate to
Upgrade Restoration to
Street Reconstruction
9 (Add to Estimate 1#3) $ 324.000 240 000 180,000 480 000 150.000 285.000 0 0 555,000
1 0 Cost of Services $ 6.840 4,320 1,440 10,080 5.040 4,320 720 8,280 9,360
· Services Estimate - $360/Servlce
· Future Hookups along Smlthtown (Eureka to Manitou) = 39 Hookups
6 Apt Units
Country Club
314 5.wtr
.ITY OF SHOREWOOD
WATER TOWER REVENUE BOND CASH FLOW
03/22/95
.
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
WATER FUND CASH BAL 1/1 270,000 399,750 311,503 300,899 233,811 142,696 4,029 3,221 4,195 6,997 6,840
INCR CASH FLOW 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
SP ASSESS PMTS - DEV 100,000 200,000 250,000 180,000 90,000 40,000
SP ASSESS PMTS - RES 29,667 29,667 29,667 29,667 29,667 29,667 29,667
SP ASSESS INT 15,300 27,200 26,350 48,875 38,703 32,762 30,260 27,736 25,217 22,695
INT INCOME 9,750 15,876 15,218 13,161 10,559 6,777 2,162 2,079 2,040 2,047 1,980
399,750 650,926 623,920 540,430 432,912 277,843 88,640 85,226 83,640 83,927 81,162
LESS:
ANNUAL BOND PMTS 107,356 102,969 98,581 94,194 89,606 65,419 61,031 76,644 77,088 72,363
ANNUAL LOAN PAYMENTS 232,068 220,053 206,038 196,023 164,008
WATER FUND CASH BAL 12/31 399,750 311,503 300,899 233,811 142,696 4,029 3,221 4,195 6,997 6,840 8,819
ASSUMPTIONS:
1) NO INCREASES IN WATER RATES (POSSIBLE INFLATION INCREASES)
2) MINIMAL ADDITIONAL HOOKUPS (CONSISTANT WITH CURRENT PACE
3) SPECIAL ASSESSMENTS OF $10,000/LOT ON 86 NEWLY DEVELOPED LOTS PREPAID
FROM 1995-2000 (INTEREST @ 8.5%)
4) SPECIAL ASSESSMENTS OF $5,OOO/LOT LEVIED ON 89 EXISTING LOTS ALONG EXTENSION PATH
SPREAD OVER 15 YEARS, BEGINNING IN 4TH YEAR (INTEREST @8.5%)
5) NO GROWTH IN DEPRECIATION OR FUND BALANCE
(ALL AVAILABLE RESOURCES OF THE WATER FUND ARE BEING UTILIZED FOR THIS PROJECT)
*
...
.
.
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
8,819 80,626 151,643 221,851 291,229 359,757 427,413 494,176 560,023 594,524
20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
29,667 29,667 29,667 29,667 29,667 29,667 29,667 29,667
20,173 17,651 15,130 12,608 10,086 7,565 5,043 2,521
1,966 3,699 5,411 7,103 8,775 10,425 12,053 13,659 14,501 15,363
80,626 151,643 221,851 291,229 359,757 427,413 494,176 560,023 594,524 629,887
80,626 151,643 221,851 291,229 359,757 427,413 494,176 560,023 594,524 629,887
..
WATER TRUNK EXTENTION SP. ASSESS BOND
PAYMENT SCHEDULE
03/22/95
TOTAL ANNUAL
PAYMENT INTEREST TOTAL ANNUAL PRINCIPAL INTEREST
YEAR DATE PRINCIPAL @ 6.75% INSTALLMENT PAYMENT BALANCE BY YEAR
1995 8/1 SALE OF BONDS 660,000
1996 2/1 65,000 22,275 87,275 595,000
8/1 20,081 20,081 107,356 42,356
1997 2/1 65,000 20,081 85,081 530,000
8/1 17,888 17,888 102,969 37,969
1998 2/1 65,000 17,888 82,888 465,000
8/1 15,694 15,694 98,581 33,581
1999 2/1 65,000 15,694 80,694 400,000
8/1 13,500 13,500 94,194 29,194
2000 2/1 65,000 13,500 78,500 335,000
8/1 11,306 11 ,306 89,806 24,806
. 2001 2/1 65,000 11,306 76,306 270,000
8/1 9,113 9,113 85,419 20,419
2002 2/1 65,000 9,113 74,113 205,000
8/1 6,919 6,919 81,031 16,031
2003 2/1 65,000 6,919 71,919 140,000
8/1 4,725 4,725 76,644 11,644
2004 2/1 70,000 4,725 74,725 70,000
8/1 2,363 2,363 n,088 7,088
2005 2/1 70,000 2,363 72,363 72,363 0
660,000 225,450 885,450 885,450
WATER TOWER lNTERFUND LOANS
PAYMENT SCHEDULE
. 03/21/95
TOTAL ANNUAL
PAYMENT INTEREST TOTAL ANNUAL PRINCIPAL INTEREST
YEAR DATE PRINCIPAL @ 6.75% INSTALLMENT PAYMENT BALANCE BY YEAR
1995 8/1 LOAN DATE 890,000
1996 2/1 178,000 30,038 208,038 712,000
8/1 24,030 24,030 232,068 54,068
1997 2/1 178,000 24,030 202,030 534,000
8/1 18,023 18,023 220,053 42,053
1998 2/1 178,000 18,023 196,023 356,000
8/1 12,015 12,015 208,038 30,038
1999 2/1 178,000 12,015 190,015 178,000
8/1 6,008 6,008 196,023 18,023
2000 2/1 178,000 6,008 184,008 0
8/1 184,008 6,008
TOTALS 890,000 150,188 1,040,188 1,040,188
..
DEVELOPMENTS
HERITAGE
SMITHTOWN WOODS
SMITHTOWN MEADOWS
LAKE VIRGINIA
MINNEWASHTA
WATTEN
PARCELS EN ROUTE
HERITAGE
SMITHTOWN WOODS
SMITHTOWN MEADOWS
LAKE VIRGINIA
WATTEN
.
.
TOTAL
UNITS
19
4
5
15
24
19
86
TOTAL
UNITS
19
40
14
4
12
89
1995
6
2
2
10
1996 1997 1998 1999 2000 TOTALS
6 4 3 19
1 1 4
2 1 5
5 5 3 2 15
8 8 4 4 24
6 6 4 3 19
20 25 18 9 4 86
,...
- ...
.
.
March 27, 1995
POLICY CONSIDERATIONS FOR EXPANSI:ON
OF THE MUNICIPAL WATER SYSTEM
Assessment:
· Assess properties as the water line goes by - deferral?
· Large parcels - Assess for 1 unit until subdivided?
· Is interest accruing while assessment is deferred?
· Flat rate assessment - $5,000 per unit or currently
platted lots.
· $10,000 per unit for new lots. .
· Will all new lots be charged $10,OOO? Even lot splits?
1
~
HookuD:
· Is hookup required when the water line goes by? In one
year? In three years? At some point in the future, upon
one year's notice?
.
· Is hookup required upon property changing hands? When the
well is replaced?
.
2
"-"
.
.
Other:
· Can the well be utilized separately from water system?
· How is a decision made when a neighborhood petition is
received? 35% petition? Is everyone along the way
assessed?
· Would deferments be allowed for those along the way to the
petitioned area? If so, who pays in the interim?
· Do we have a policy that all new lots will have City
water? Including small lot splits?
· Should the City policy be to balance policies to attempt
to neither encourage nor discourage development?
· If a petition is received for a project for which a cost
benefit analysis shows it to be very expensive, if the
residents want to pay their $5,000 for water, is the
petition project placed on the CIP with an intent to do
when the water fund balance allows?
3
Finance:
· Should funds from a number of sources be set aside for in-
a-tower fund? For oversizing lines?
· Should the connection charge be raised from $4,000 to
$5,000 for current structures? Should there be any
credits allows?
· Should water rates be analyzed each year and adjusted
accordingly {at least increasing them for inflation}?
4
-PJ
.
.
,
- ..
-
.
DRAFT
ORDINANCE NO. _
AN ORDINANCE AMENDING CHAPTER OF THE
SHOREWOOD CITY CODE ADOPTING AN ASSESSl\''1ENT
POLICY FOR STREET RECONSTRUCTION
THE PROVISION OF MUNICIPAL WATER
THE CITY COUNCll.. OF THE CITY OF SHOREWOOD. MINNESOTA.
ORDAINS:
Section 1. Section
is renumbered as Section
Section 2. Chapter _ of the Shorewood City Code is hereby amended by adding the
following:
SECTION
. STREET WATER ASSESSMENT POLICY
Subd. 1 - SCOPE AND PURPOSE.
This policy is intended to provide a fair, equitable. and consistent means of
allocating the cost of street reconstructioB water improvements. to existing streets.
This policy does Bot apply ta Bey: COl15tructiOB Bor to mamtenanee functiOlls which
are defmed as patching. seal coating and o':erIay. Street recoBstructioB is
considered to be any street improvement over and above these maintenance
functioBs.
Subd. 2 - DEFINITIONS
a. Adjusted Front Footage: A method for determining the average front footage for
odd-shaped lots which would be equivalent to the footage of a rectangular shaped
lot of the same area and depth.
Annual Rate: The rate used for City water assessments as
completed under Subdivision 5.
b.
. c.
d.
e.
Building Site: An area of land on which a building exists or an area of land
meeting city code requirements on which a building could be constructed
Construction Cost: Amount paid to contractors for constructing the improvements.
Construction Interest: Cost of fmancing the improvements from the time the
project is initiated until the assessment roll is approved by the City Council.
less any interest earned on invested funds. The interest rate will be at the
expected assessment rate.
f. Dwellinv Unit: See Subdivision _ under the City's Zoning Code.
g. Equivalent Residential Units: Equivalent residential units are the number of
assessment units into which a large or unplatted parcel of land. which abuts a City
functionally classified collector or arterial street. is divided in order to determine an
assessment rate. The number of equivalent residential units is determined by
dividing the adjusted front footage of the parcel by the average street footage of the
project.
1
i
h. Front Footage: The shortest dimensions of existing or potential sites abutting the
streets.
1. l.&!: Land occupied or to be occupied by a building and its accessory buildings,
together with such open spaces as are required under the provisions of this zoning
regulation having not less than the minimum area required by this Zoning
Ordinance for a building site in the district in which such lot is situated and having
its principal frontage on a street, or a proposed street approved by the Council
J. Lot: Corner: A lot situated at the junction of and abutting on two (2) or more
intersecting streets; or a lot at the point of deflection in alignment of a single street
the interior angle of which is one hundred thirty-five degrees (135 0) or less.
k. Project Cost (Total Cost of Im.provements): All construction costs, plus costs for
administration, engineering, legal, fiscal, easement acquisition assessing, and any
project related work previously done but not assessed.
1.
Residential Unit: A residential unit is a platted single family residential lot which,
in accordance with the City of Shorewood's zoning and subdivision regulation,
cannot be further subdivided.
.
m. Side footage: The longest dimension of existing or potential corner building sites
. abutting the street
Subd. 3 - SPECIAL ASSESSMENTS
a. Benefit Principle
Special assessments, as authorized by Minnesota State Law, Chapter 429, may be
levied only upon property receiving a special benefit from the improvement. In
~ Minnesota, the Constitution and courts apply this general rule by placing the
following limitations upon the power to levy special assessments: 1) the rate must
be uniform and consistent upon- all property receiving special benefit; 2) the
assessment must be confined to property specially benefited; and 3) the amount. of
the assessment must not exceed the special benefit.
The special assessment is a financial tool employed by the City of Shorewood as a
means of allocating the costs of specific improvement projects to the benefited
properties and spreading tho~e costs over a number of years as specified by the
City Council.
Special assessments are billed to the property owner along with real estate taxes.
There is, however, a distinct difference between taxes and special assessments.
Real estate taxes are a function of the real estate value as determined by the
municipal assessor, while special assessments are a direct function of the
enhancement of value or the benefit which a specific improvement gives to the
property
b. Consistent & Equitable
Once an improvement project is initiated and it is determined that the improvements
are necessary and desirable, the special assessment procedure is intended to
equitably and consistently allocate and levy the cost of specific improvements to the
benefited properties.
.
.
.
!he City must recover the appropriate portion of the expense of installing public
Improvements, if undertaken, while ensuring that each parcel pays its fair share
of the project cost in accordance with these assessment guidelines.
This policy sets forth the general assessment methods and policies to be utilized by
the City Administrator and City Engineer when preparing assessment rolls for
approval by the City Council so as to assure uniform and consistent treatment to the
various properties from year to year. The following policy is general in nature, and
that certain circumstances may justify deviations from stated policy as determined
by the City Council.
Subd. 4 - SPECIAL ASSESSMENT PROCEDURE
a.
A flow chart on the Shorewood Public Improvement Process for Special
Assessment projects giving a detailed explanation of the process is shown on the
next page.
Initiating the Proceedings
Improvement proceedings may be initiated in anyone (1) of the following three (3)
ways:
1. By a petition signed by the owners of not less than thirty-five
percent (35%) of the frontage of the real property abutting on the
streets named as the location of the improvement;
2. By a petition signed by 100% of the owners of real property abutting any
street named as the location of the improvement. Upon receipt of a petition
of 100% of the abutting property owners, the City Council must determine
that it has been signed by 100% of the owners of the affected property.
After making this determination, a feasibility report shall be undertaken and
the project may be ordered without a public hearing, or
3. By the initiative of the City Council.
Petitions for improvement shall be referred for Administrative report and estimated
budget. A simple majority vote of the City Council is needed to start the
proceedings Whether initiating the proceedings or accepting a petition requesting
such proceedings, the City Council may simultaneously order a feasibility report on
the proposed improvement. Feasibility reports shall be paid for by the City in the
case of street reconstruction projects and recouped once the project as completed
under the terms of this policy.
Preparing the Feasibility Study
An improvement project which is initiated by action of the City Council or by a
35% petition may be ordered only after a public hearing. Prior to adopting a
resolution calling a public hearing on an improvement, the Council must secure
from the City Engineer a report advising it in a preliminary way as to:
1. Whether the proposed improvement is feasible;
2. Whether the proposed improvement is consistent with Capital Improvement
Planning;
b.
3. Whether the improvement should be made as proposed or in connection
with some other improvement;
4. The estimated cost of the improvement;
5. A proposed project schedule; and
6. Any other information thought pertinent and necessary for complete Council
consideration.
c. Holdini a Public Hearin~ on the Improvement
Improvement projects which are initiated by a 100% petition may be ordered by the
City Council without a public hearing if the City Council deternunes the project
may be undertaken witfiout unreasonable changes to the Capital Improvement
Finance Plan or the petitioning pro~rty owners agree to pay 100% of the cost of
the improvements. In the case of a Council-initiated project or petition of less than
100% of abutting property owners, the Council must adopt a resolution calling a
public hearing on the Improvement project for which mailed and published notices
of the hearing must be gIven. The notice of public hearing must include the
following information: .
1) The time and place of hearing;
2) The general nature of the improvements;
3) The estimated cost; and
4) The area proposed to be assessed.
Not less than ten (10) days before the hearing the notice of hearing must be mailed
to the owner of each parcel in the area proposed to be assessed. The notice of
public hearing must be published in the City's legal newspaper at least twice, each
publication being at least one week apart, with the last publication at least three (3)
days prior to the hearing.
At the public hearing, the contents of the feasibility study will be presented and
discussed with the intent of giving all interested parties an opportunity to be heard
and their views expressed.
.
d. Orderini the fnwrovement and Orderini Preparation of Plans & Specifications
Following a public hearing a resolution ordering the improvement may be adopted
at any time within six (6) months after the date of the hearing by a four-fifths (4/5)
vote of the City Council, unless the petition was initiated by a 35% petition in
which event it may be adopted by a majority vote. The resolution may reduce, but
not increase, the extent of the improvement as stated in the notices. At this time a
special assessment is considered to be "pending" for all assessable properties in the
improvement area.
After the order of an improvement project, the City Council must order the
preparation of plans and specifications which may be included as part of the
resolution ordering the improvements. When the Council determines to make any
improvement, it shall let tIle contract for all or part of the work, or order all or part
of the work done by day labor, no later than one (1) year after the adoption of the
resolution ordering such improvement unless a different time limit is specifically
stated in the resolution ordering the improvement.
.'
.
e. Advertisin~ for Bids
If the estimated cost of the improvement exceeds $25,000, bids must be advertised
for in the legal newspaper and such other papers and for such length of time as the
City Council deems desirable. If the estimated cost of the improvement exceeds
$100,000, the advertisement must be in a paper published in a fIrst class city, or in
a trade paper not less than three (3) weeks before the last date for submission of
bids. The notice must contain the following information:
1. The work to be done;
2. The time when bids will be publicly opened which must be not less than
ten (10) days after the tirst publication of the advertisement when the cost
is less than $100,000, and not less that three (3) weeks after publications
in all other cases, and
3. A statement that no bids will be considered unless they are sealed and
accompanied by cash, a cashier's check, bid bond or certifIed check for
such percentage of the bid as specifIed by the City Council.
Awarding Contracts
f.
Following receipt of the bids, the City Council must either:
1. A ward the contract to the lowest responsible bidder; or
2. Reject all bids
The contact must be awarded no later than one (1) year after the adoption
of the resolution ordering the improvement unless that resolution
specifies a different time limit.
The City Council may purchase the materials and order the work done by
day labor or in any manner it deems proper if:
1. The initial cost of the entire work does not exceed $25,000;
2. No bid is submitted after advertisement; or
3. The only bids are higher than the engineer's estimate.
g. Preparin~ Proposed Assessment Roll
After the expenses incurred or to be incurred in the completion on an improvement
have been calculated as defmed in Section VI-C Project Costs, the City Council
must determine the amount it will pay and the amount to be specially assessed. The
City Engineer and Administrator/Clerk must calculate the amount to be specially
assessed against every parcel of land benefIted by the improvement. The area to be
assessed may be less than, but not more than, the area proposed to be assessed as
stated in the notice of public hearing oo.the improvement The assessment roll
should contain a description of each parcel of property and the assessment amount
including any deferred assessments. The assessment roll must be f1led with the
City Administrator/Clerk and be available for public inspection.
h. Holdin~ Public Hearin~ on Proposed Assessments
A public hearing on the special assessments must be held following published and
mailed notice thereof. The notice of the assessment public hearing must include the
following information:
1. The date, time and place of the meeting;
2. The general nature of the improvement;
3. The area proposed to be assessed;
4. The total amount of the proposed assessment;
5. That the assessment roll is on fIle with the Clerk;
6. That written or oral objections will be considered;
7. That no appeal may be taken as to the amount of assessments unless a
written objection signed by the affected property owner is fIled with the City
Clerk prior to the hearing or presented to the presiding officer at the hearing;
and
8. That the owner may appeal the assessment to the district court by serving
notice on the Mayor or City Clerk within three (3) working days after the
adoption of the assessment and fIling notice with the court within ten (10)
days after such appeal to the Mayor or the City Clerk.
The notice of the assessment hearing must be published in the legal newspaper at
least once, not less than two (2) weeks prior to the hearing.
The City Clerk must mail notice of the assessment hearing to the owner of each
parcel described in the assessment roll at least two (2) weeks prior to the hearing.
The mailed notice must also include, in addition to the information required to be in
the published notice, the following information.
1. The amount to be specially assessed against that particular loti piece or
parcel of land;
2. The right of the property owner to prepay the entire assessment and the
person to whom prepayments must be made;
3. Whether partial prepayment of the assessment has been authorized by
ordinance;
.
.
4. The time within which prepayment may be made without the assessment of
interest; and
5. The rate of interest to accrue if the assessment is not prepaid within the
required time period.
Adopting the Assessments
At the assessment hearing or at any adjournment thereof, the City Council may
adopt the assessments as Eroposed or adopt the assessments with amendments. If
the adopted assessment differs from the proposed assessment, the clerk must mail
the owner a notice stating the amount of the adopted assessment. The adopted
assessment roll shall include any and all deferments on large or unplatted parcels of
land along the City's street system.
.
.
b.
J. Transmittin~ Assessment to County Auditor
After the adoption of the assessment, the Ci~ Clerk must transmit a certified
duplicate copy of the assessment roll, including all deferred equivalent residential
urnts to the County Auditor.
Subd. 5 - SPECIAL ASSESSMENT POLICIES
It is the policy of the City of Shorewood that all properties shall pay their fair share
of the cost of local improvements as they benefit. It is not intended that any
property shall receive the benefits of improvements without paying for them. +aese
policies relate to street reconstruction projects.
a.
Establishing an Annual Rate
An annual assessment rate shall be established by the end of February by City
Council Resolution upon recommendation of the City Engineer. The City E.ngineer
shall undertake a study to detennine the per foot project cost of a "typical" 21 foot,
rural cross section street (with HO curb and ;utter) in the metropolitan area, adjusted
for typical Shorewood soil conditions (see following page). Whee determirl:iftg an
annual rate '.vith construction costs of the pr~'/ious construction seasoB the
construction cost mdex as pablisl1ed by the "Engmeering Ne~::s Record" or
consumer price index may be used.
When the City detennines that a street should be reconstructed it would be rebuilt to
its current ...:idth. Curreet width could be adjasted by the City Council upon request
of the property oONoers or by the Couacil following public hearing if traffic counts
or safety considerations suggest a wider street is warranted.
An annual assessment rate shall be established by the end of
February by City Council resolution upon recommendation of the
City Engineer. The City Engineer shall establish the rate based on
the index of construction costs as published by the "Engineering
News Record" or the Consumer Price Index, with a base rate as
established below.
i\ssessable Street Reconstruction Projects
Street reconstruction projects are Bot lik~y to require tlle same amoUflt of worle
throughout the entir~ length of the project. That is, some sections may Beed t.o be
fully excavated and back :fiI:led whi:le other sectiOB5 may eeed simple r~shaping It is
the policy of the city that a project is assessable when its ag;regate cost is estimated
to be at least 150% of a simple 2 inch overlay project. .
Base Rates
From time to time, at the direction of the City Council, the City
Engineer shall determine an updated base rate. This study will
include, but not be limited to, the following items:
1) Proposed Capital Improvement Costs;
2) Existing Water Fees;
3) Existing Water Fund Balance.
c. P-rcijeet Costs
Project cost shall i.flell:lde, bl:lt flOt be limited to, the followi.flg:
1. Total. COBStruCtiO.fl cost iacll:1diRg mtersectioBs
2. E.flgifleeriflg fees
3. l\cJ.mHH.stratiye fees
1. Right of '.vaylea5ClffieBt acq1:1isitionicoBdemnatiofl costs
5. Legal. fees
6. Fiscal Ft!es
7. Capita/..i2eci mterest
d. Term of Assessment
Assessments for street reeoBstructiofl water should be assessed for a teB. (10)
fifteen (15) year period unless the City Council determines that some other
period of time is more appropriate.
.
e. Government Owned Prqperties
Properties belonging to government jurisdictions, including the City, will be
assessed.the same as privately owned property.
f. Non-developable Land
Special Assessments shall not be levied on properties deemed unbuildable due to
the existence of undeveloped lands lying wholly and completely within zoned
wetlands, flood plains, DNR protected wetlands and/or having restricted soils as
determined by the City Building Inspector. However, all parcels of land are
assumed to be buildable until proven otherwise by the owner.
Interest Rate
.
g.
The interest rate charged on assessments for all projects financed by debt issuance
shall not exceed two percent (2%) of the net interest rate of the bond issue. This is
necessary in order to msure adequate cash flow when the City is unable to reinvest
assessment prepayments at an interest rate sufficient to meet the interest cost of
debt or when the City experiences problems of payment collection delinquencies.
In the event no bonds are issued then the rate of interest on assessments shall not
exceed two (2) percent greater than the average rate of interest on all bonds issued
in the previous calendar year or the current market municipal bond rate. Interest on
initial special assessment installments shall begin to accrue from the date of the
resolution adopting the assessment. Owners must be notified by mail of any
changes adopted by the City Council regarding interest rates or prepayment
requirements which differ from those contained in the notice of the proposed
assessment. .
h. Pavment Procedures
The property owner has four available options when considering payment of
assessments:
.
.
1. Tax Payment - If no action is undertaken by the property owner, then
special assessment installments will appear annually on the individual's
property tax statement for the duration of the assessment term.
2. Full Payment - No interest will be charged if the entire assessment is paid
within 30 days of the date of adoption of the assessment roll. In the initial
year, the property owner may at any time between that date and November
15, prepay the balance of the assessment with interest accrued to December
31 of that years
3. Partial Payment - The property owner has a one-time opportunity to make a
partial payment reduction of any amount against higher assessment. This
option may only be exercised within the 30-day period immediately
following adoption of the assessment roll.
4. Prepayment - The property owner may, with the exception of the current
year's installment of principal and interest, pay the remaining assessment
balance at any time, prior to November 15 without further interest charges.
Thereafter, the next installment, with interest through December 31 of the
following years will be levied for collection with the real estate taxes
payable the ensuing year. The principal balance will be reduced by the
amount of the installment.
1.
Appeal Procedures
No appeal may be taken as to the amount of any assessment adopted unless a
written objection signed by the affected property owner is fIIed with the City
Administrator's office prior to the assessment hearing or presented to the presiding
officer at the hearing. The property owner may appeal an assessment to District
Court by serving notice of the appeal upon the Mayor or City Administrator within
30 days after the adoption of the assessment and filing such notice with the District
Court within 10 days after service of the appeal upon the Mayor or City
Administrator.
Reapl'ortionment Upon Land Division
When a tract of land against which a special assessment has been levied is
subsequently divided or subdivided by plat or otherwise, the City Council may, on
application of the owner of any part of the tract or on its own motion, equitably
apportion among the various lots or parcels in the tract all the installments of the
assessment against the tract remaining unpaid and not then due if it determines that
such apportionment will not materially impair collection of the unpaid balance of the
original assessment against the tract. The City Council may require furnishing of a
satisfactory surety bond in certain cases as specified in Minnesota Statutes Section
429.071, subd. 3. Notice of the apportionment and of the right to appeal shall be
mailed to or personally served upon all owners of any part of the tract. In most
cases dividing the assessment balance evenly on a unit or lot basis would result in
an
equitable apportionment. If equitable in a particular case, such a procedure would be
most practical and administratively effective
Subd. 6 - ASSESSMENT METHOD
J.
b.
a.
ORce afl asse
for eaea r . SSlBeRt fate aas b
The Ciljl Pc:l,OCt, ao _er th.~ .'taBlisBea for tho .
"anil" Of "I< 11<:11 ""''I _ ..IElIh, Qc,igB or . } .ar, IIlat fllto .... .
tho l'f9!IOSO:nt foot" The C~:W ~f!VIo ....100.::; of ''''''.1 ~Oin;~c:. =
.ljlli..el asscllSmeat F911 a"moer s!laIl '" ...."....nt for a - "
tioat fa . .....smear F911 fo ~osea "Poa wilieR co"""""a tho "'"'" .""R J'f'li.cts
~ si~~:~.,=~~ ~.:.:; ;:or'T"::"~is~: ~t ::::
~ elIIlI <liffl!t'eBtilll ;.; tNl./",at footage "",7a..'7'.ly ~ leagth o.\wOOa Ilio
Ul)il Metho<l "'al fOelage, cr ~.nefi~ :/: ~ w:'~ ~ boBefil
, tl e assessable ere ,IS
The aait _Ill a jlf<ll"'fl1O'.
praperties ar-e ~f at ~sessmeRt is m
",0<1 ,"OOll5lrU<1lie SllIlilIlr benefit, ~ar "':.1 e""""oaIy osoa w
.... . P"'1ale ElI'.. a oI9l1g . pllltiGal 9lllCc05'orily ,iHlH hos tho Be,,"filin.
h.m" . "0. .. BIBeR' ar F90<1"'i111ilf ar ..om II ~
net i>". ;a. In ,ecl1. ~ ~..efits th';;' ~;:;;.b.~fii lBe ,~~r ian_.,
.. ' 'Imply..... . eo, Eliroclly all . F9pOIt1e<l
^ enit' SlBg tho allatling fro ettmg tho Rl8fl
_""",al >hall ~. . al foo!&gO woala
A dan'/ed accordH
.ldHH:lal asses ag te the tolIo""
as!JeS<)allle e::......al RIle X pRlject I _ "fig formela.
s. aH(:I.h X 0 33 I
The RU!Bbcr of as . , IIIlmBer of '
assessmeRt are sessmaRt l:1nits as .
~. PO""Dle 0 · ,l1aIl Be .~ua1 to slgaea to .""R ar
is ..~ .~ p"",..las tle~ lDlIltimem .,::,,::1 ef laa<1 willliB tho
"lllllBe Ciljl', Zo Imea ~y tNl Ci' r 0 potCllBallola n' .
Comer lots s!laIl' BIng Or<IiBaRoe. l} Plausor. ^ lo"haIll;~R coola
,tn!et He...... typleally have 0 e efinea
e' n .ar Y3:e' He halfEQ~
. o"lllllCMa wilk on ea"'" a_er .f ". .) ef its llSOO'5Il .
:=.~.~~~=r:i~"::a=;; ~~~se~oa to'oaeII
. lfSl P . n,.. am" . os"",,, 11
mill Feotaqa '4 rOjocl <Iue 10 lot ari::;ollly Df OOIlCl'it f;"':~ '....oala
.' ethoa ' , "'1't, aa<I Rome l.c . 0
The ae!ell! . ali....
shaH NOT b~YSICa:l Gimeasiens 0
r-ullr ~~=a as tho ~~::: ~eltiag · _01 roc
.Ioge asseasmeal r':~:;' :,jeate4 ffe':fu:lto ~eIate tire o::li.a proj.CI
A . tleavoa ncceaJll age will ~o Qcleml' meal fer ·
= ..'.oo....al _ X' ag to lIle fonO'NiBgfu~ '?" fr.al
ootago. l'fOJ.ctlesgtl1 X e ..
'FIr - .33/ t.ta1 .
.._~ ~UFflO58 of IIli o<IJB5tod
r,<liVf- p...,.I, ~ ~d i, t. eljllllli;!
.:nOWll!g Pro..d....;' ~ .ef}' _ Elie ..seaal'llCat colcele .
~~!e proco~ ~l~ v~Bea eal<~='~ly in :=.r:.~.ts .f ,imilar size.
Qc\Va I. _ will be 'c · c!ermined b . ~ !ll5led fmnl fo. 0 area The
deaeripli: ="'ltot, ~::i:.r.::aiIaIlll P'!: ::c~~:ac.nii~ ~ :Ioction .f
o ....." ""y .""000 fracti ... map, and "ill b poroel.
OH deleted. Care;'. e rounded
I. 8lollElard Lo.. ~ oaea! type
.
.
6. Irregularly Sh
aped Lots
.
.
.
2. Rectan;ular Variation Lots
3. Triangular Lots
4. CuI de sac Lots
7. Comer Lots
8. Flag Lots and Back Lots
9. Double Frontage Lots
5. Curved Lots
The ultimate objective of these procedur-es is to arrive at a fair and equitable cHstribution
of cost .....hereby cQBsideratioB. is ~ven to lot size and a::ll parcels are comparably
assessed.
Assessments for Ci!y water shall be made in accordance with the
formula in the following table:
xzstzng
Where R,t = Annual rate as established under Section 5.a
No of Units = Number of dwelling units
* Multiple family dwellings include those homes housing more than
a single dwelling unit under one roof (i.e. duplex, tn-plex,
apartments). For the puposes of this ordinance, no more than 12
tfwelling units will be allowed for each base rate applied.
In addition to the above, developers of new subdivisions. will be
required to install later mains, services and appurtenant items at
the time of platting. In those cases where Czty water will not be
available at the time of platting - as determined bI the City
Engineer - the development shall pay, at the existing rate until
sucn time as water is available. At that time, the diff.erence
between the pro/!osed ate and the amount already paz"d shall
become due ana payable.
Subd. 7 - DEFERRED ASSESSMENTS
a. The City Council may defer Special Assessments:
1. On POrtiOHS of lar;e a:aets 0f lalla as allowed in this chapter so as to minimize the
infl1:leBCe of the pfO:f)OSea improvement OR the de'relopment of said laRd.
2. On homestead property owned by a person who qualifies under the hardship criteria
set forth below.
b.
Procedure
The property owner shall make application for deferred payment of special
assessments on a form prescribed by the Hennepin County Auditor and
supplemented by the Sliorewood City Administrator. The application shall be made
Wltfiin 30 days after the adoption of the assessment roll by the City Council and
shall be renewed each year upon the filing of a similar application no later than
September 30. The City Adniinistrator shall establish a case number for each
application; review the application for complete information and details and make a
recommendation to the City Council to either approve or disapprove the application
. for deferment. The City Council by majority vote, shall either grant or deny the
deferment and if the deferment is granted, the City Council may require the
payment of interest due each year. Renewal applications will be approved by the
City Administrator for those cases whereby tlie original conditions for
qualifications remain substantially unchanged.
If the City Council grants the deferment, the City Administrator shall notify the
County Auditor who shall in accordance with Minnesota Statutes, Section 435.194,
record a notice of the deferment with the County Recorder setting forth the amount
of assessment.
.
~
A
.
.
.. p
.
.
1.
Interest shall be charged on any assessment deferred pursuant to this Section at a
rate equal to the rate charged on other assessments for the particular public
improvement projects the assessment is fmancing. If the City Council grants an
assessment deferral to an applicant, the interest may also be deferred, or the interest
may be due and payable on a yearly basis up until the assessment period terminates
and only the principal is deferred. The decision as to whether the principal and
interest or just the principal is deferred is decided by the City Council when
considering the application.
Lar~ Tracts of Land
Upon application, the City COl:IFlcil may def-er the assessments on lar~e tracts of
land that may be sblbdh'ided or de'/eloped m the future. It is the inrent of this policy
to gFaflt defermen~ of special assessmems to lar~e !fliers so as to mif1:Hnize the
in&ence of the proposed impro'/ement on the premature de':elopmeat of said land.
The defermeat gTaBted penmant to this sectiofl may be of mdefmite ElafatiOB. subject
to the occurrence of:
o 'The subdi'/isiofl of the property resultiBg in the creation of a new, buildable lot
o If the City CoeHcil determiJ:les there is HO cOHtilll:ling need for the defelT;Bent
2. Conditions of Hardship
a) Any applicant must be 65 years of age, or older, or retired by reason of
permanent and/or total disability and must own a legal or equitable interest
In the property applied for which must be the homestead of the applicant, or
b) The annual grOSS income of the applicant shall not be in excess of the very
low income "'limits (50% of median) asset forth by family size in Hennepin
County's Section Ei~ht .~uidelines. Calculation of the total family income
shall be determined oy me summation of all available income sources of the
applicant and spouse. Income specified in the application should be the
income of the year proceeding the year in which the application is made, or
the average income of the three years prior to the year in which the
application is made, whichever is less, and
c) The special assessments to be deferred exceed $1,000.00.
d) Permanent and/or total disability shall be determined by using the criteria
established for "permanent and total disability" for Workman's
Compensation, to wit:
1) The total and permanent loss of the sight of both eyes.
2) The loss of both arms at the shoulder.
3) The loss of both legs so close to the hips that no effective artificial
members can be used.
4) Complete and permanent paralysis
5) Total and permanent loss of mental faculties.
6) Any other injury which totally incapacitates the owner from working
at an occupation which brings himlher an income .
An applicant must substantiate the retirement by reason of permanent andlor total
disabilio/ by providing a sworn affidavit by a licensed medical doctor attesting that
~e awlicant IS unable to be gainfully employed because of a permanent andlor total
disaJjility .
Section 3. This Ordinance shall be in full force and effect from and after its passage and
publication.
ADOPTED BY THE CITY COUNCIL of the City of Shorewood, Minnesota
this ' day of .
ROBERT B. BEAN, MAYOR
ATTEST
JAMES C. HURM, CITY ADMINISTRATOR/CLERK
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Chapter 27
Financing Public
Improvements
.
.
City councils frequently find themselves
confronted with increasing pressures for
new and improved streets. Sidewalks.
stonn sewers. parks. and other publ1c
facilities. as well as mounting construc-
tion and interest prices.
A tool to ease the problem of finanCing
local Improvements is the special assess-
ment. Special assessments are charges a
city levies against real property for a local
improvement which provides special
benefits to the charged properties. The
city may finance all or some part of an
improvement's cost In this manner.
Special assessments can play an impor-
tant role in city finance. They provide a
comparatively Just and equitable means of
financing capita1improvement programs
wh1le m1n1m1z1ng the demand on the city
tax levy and statutory debt limitations.
To insure full protection for property
owners. the courts insist on strict compl1-
ance with procedural requirements.
Because these requirements have legal
implIcations. city councils should have
the city attorney handle assessment
proceedings. Bond buyers will insist on
strict confOrmity with all legal require-
ments. and will. In many cases, require a
separate legal opinion on this matter.
The local improvement code gives cities
authority to levy special assessments. 1
Court dec1S1ons and attorney general
opinions have added to the complexity of
the issue.2 This chapter will cover the
following:
. Use of Special Assessments
. Synopsis of Procedure
. Special Problems
. Alternatives to Special Assessments
. How This Chapter AppJles to Home
Rule Charter Cities
Use' of Special Assessments
Special assessments are an indirect
fonn of taxation. They are a compulsory
charge on selected properties for a par-
ticular improvement or service which
benefits the owners of the selected prop-
erty, and are also In the interest of the
public. Special assessments have three
distinct characteristics:
HANDBOOK FOR MINNESOTA CITIES
.'e'.' '..
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. They are a compulsory levy a city uses
to finance a particular pubUc
Improvement program;
. The city leVies the charge only against
those particular parcels of property
which receive some special benefit
from the program; and
. The amount of the charge bears a
direct relationship to the value of the
benefits the property receives.
SpeCial assessments apply only to real
estate. Cities never levy them against
personal or movable property. In theory.
special assessments are more equitable
than property taxes because those who
pay them obtain some direct benefits from
the improvements.
Special Assessment Uses
Special assessments have three impor-
tant applications.
. The first and most popular Is for
finanCing new improvements.
particularly when the City Is
converting new tracts of land to urban
use. In this application. they
frequently pay for the opening and
- surfacing of streets. install1ng ut1l1ty
lines. and construCting curbs. gutters.
and sidewalks.
. Special assessments may also
underwrite the cost of major
maintenance programs. Cities can.
and often should finance large-scale
repairs and maintenance operations
on streets. sidewalks. sewers. and
sJm1lar facilities with special
assessments.
. A Significant new use of special
assessments is in the redevelopment
of existing neighborhoods. When
residential areas are confronted with
progressive deterioration. or even
when presently sound neighborhoods
can become more desirable through
the development of parks.
playgrounds. tree plantings. and new
street patterns. the city can use
special assessments to good
advantage.
Relation of Special
Assessments to Market Value
Special assessments reflect the tnflu-
ence of a specific localtmprovement on
-- .. ~---_. .. --- -..--. --..-
398
the value of specific property. No matter
what method the city uses to estabUsh the
amount of the assessment. the real mea-
sure of benefits is the increase in the
market value of the land as a result of the
Improvement.
In the past. councils have had broad
discretion in determining benefits. and
courts did not overturn their actions
unless the council abused the discretion.
However. Minnesota Supreme Court
decisions have made this council determi-
nation more vulnerable.3 Under one court
decision. when a dissatisfied property
owner appealed a special assessment and
alleged that the assessment exceeded the
increase in market value of his property
resulting from the Improvement. the
reviewing court did not grant any defer-
ence to the decision of the council. In-
stead. the court took new evidence and
determined the amount of benefit as if the
council had never made a decision on that
issue. As a result. special assessments are
less Ukely to be swift, ine."Cpensive. and
certain.
Cities finanCing local improvements by
special assessments must use more care
in conducting proceedings. Before order-
ing an improvement. the council should.
as in the past. gather as much eVidence
as possible on whether the benefits of a
particular improvement are sufficient to
justify the cost. It must also determine the
increases in market value. If voters have
petitioned for an improvement. and the
benefit does not substantially exceed the
cost. a council might use different strate-
gies depending on its objectives and what
it sees as the potential for appeals.
The council could. under certain cir-
cumstances. obtain waivers of rights to
appeal before entering into the contract
and ordering the Improvement. That plan
may be feasible only if the assessable area
is small. For larger projects. the council
might consider making the Improvement
contract conditional on the absence of
objections being filed within 30 days after
the assessment hearing. Under this plan.
the council would not enter into a binding
contract. nor would any improvement
work start until after both the improve-
ment and assessment hearings and the
period of time for appeals had elapsed.
While this plan may cost more. a council
.
.
"A
,
q;
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might decide that avOiding lltigauon costs
would be worth that chance.
Another way to reduce the number of
special assessment appeals is for the city
to pay a substanUal portion of the cost of
alltmprovements out of general funds.
The larger the portion of cost the city
assumes, the smaller the chances that
any indtvtdual assessment would exceed
the benefit from the improvement as
measured by the increased market value.
Under the local improvement code, in
order to appeal a special assessment. a
property owner needs to file a signed,4
wr1tten objection with the city clerk prior
to the assessment hearing. or with the
preSiding officer at the hearing. If there is
an objecUon, the council may consider it
at an adjourned hearing after g1v1ng the
property owners noUce.
At the adjourned hearing. the council or
a council committee may hear further
written or oral testimony from the prop-
erty owners and from city officials and
other witnesses as to the assessment
amount. The council must prepare a
record of the proceedings at the adjourned
hearing and wr1tten findings as to the
amount of the assessment roll.
A property owner would waive any
objection the council did not receive at
the assessment hearing, unless the failure
to object at the hearing is due to a "rea-
sonable cause, .. a phrase that is not
defined in the statutes, and which has not
received in depth judicial analysis. The
court decisions hint that the court, on
appeal of an assessment. should give
deference to the city council's determina-
tion of the assessment amount if "the
underlying deCiSion-making process is
deSigned to effectively produce a correct
or just result or Jf the decision is informed
by conSiderable expertise."
Whether the proceeding at the ad-
Journed heanng w1lI bring the assessment
determination within the quoted phrase,
without the use of an impartial reviewing
officer or body, remains to be seen. The
procedure w1lI at least save the council
from the need for a more expert determi-
nation until a property owner objects at
the Original assessment proceeding.
Another possib1I1ty Is available under
the local improvement code.5 The law has
provided that the city could not calculate
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CHAPTER 27
the total expense of the improvement until
after the city had let a contract or ordered
the work done by day labor. Only then
could the city propose the assessment
roll. Under an amendment, the city may
now calculate the expense at any time,
and the council may detennine. the as-
sessment amount and prepare the assess-
ment roll. It is now possible to advertise
bids and allow sufficient time after the
closing date to pennit the city to prepare
the assessment roll on the basis of the bid
and hold a heanng on that basis.
Alternatively, the councll might, when
the financial situation warrants, proceed
with the proposed assessment on the
basis of estimates with a reserve fund
from general taxes and other uncOmmit-
ted sources of revenue making up any
dJfference between the assessments and
the project cost. This method may be
particularly attractive Jf the city follows
the polley of paying some substant1al part
of improvement costs from tax revenues.
Either method avoids the danger of
proceeding on estimates and then having
to make a substantial reassessment when
actual costs turn out to be in excess of
the esttmates. If a reserve fund from
general revenues is available, no reassess-
ment will be necessary unless the cost is
less than esttmates, and no one will object
when that process results in lower special
assessments.
Pros and Cons of Special
Assessments
The follOwing is a sunnnary of the
advantages and disadvantages of special
assessment finanCing. The councJl can
avoid many of the disadvantages with
adequate plans and a long-range capital
improvement program.
The advantages of special assessment
financing are the follOwing.
. Special assessments have been an
excellent source of revenue.
. They are a means of raising money
outside city debt and tax limits.
Special assessment levies are not
subject to either the mill rate or the
per capita l1mitations on city taxing
powers. (Tax levies to pay the city's
share of the improvement costs are
subject to the percentage limits.)
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HANDBOOK FOR MINNESOTA CITIES
Special assessment bonds do not
count toward statutory debt
Umitations.
. Special assessments provide a means
of levying charges for public servtces
against property otherwtse exempt
from taxation.
. Special assessments lower the cost to
the community of bringing
undeveloped land into urban use and
of increasing the usefulness of urban
land.
. Perhaps the chief value of special
assessments is that by charging the
property owner for the benefit
received. they prevent. or minimize the
possibility that a property owner will
reap a financial profit from the
improvement at the expense of the
general taxpayer.
The disadvantages of special assess-
ment are as follows.
. First and foremost are the dIfficulties
in special assessment administration.
In addition to the subjective difficulty
of relating assessment charges to
special benefits. the administrative
procedures require careful execution
In order to avoid court litigation. Whl1e
assessment determinations
necessartly involve Judgment. many
communities have instituted
procedures making this determination
as objective as pOSSible.
. Cities have frequently used special
assessments to underwrite premature
public improvements. Because the city
generally bears some of the cost of
every public improvement, land
speculators sometimes urge counc1ls
to do unjustifiable special assessment
programs.
. The availability of special assessment
finanCing often tempts city officials to
underwrite the cost of governmental
programs which should be an
obligation of the entire City.
. Unless they conform to a long-term
city financial and capital
Improvements planning program.
special assessments can subject the
city to two serious financial dangers.
If the city frequently undertakes
special assessment bond issues backed by
the full faith and credit of the city. in an
unplanned manner. they might over-
extend city credit. This leads. to higher
.I
interest charges on all City and school
district borrowing and increases the
possibility of default.
If special assessments along with
regular property taxes become too heavy a
burden on individual property owners.
they w1l1 encourage tax delinquents and
ImpertI the city's credit and borrowing
position.
From the counc1l's point ofvtew. the
public's reaction to a proposed special
assessment program might be the most
Important determinant of feastbil1ty. Wh1le
taxpayer resistance is usually minimal.
this IS not true in every instance. Special
assessment programs receive much
greater public support if the counc1l
adequately informs the people of its
intentions to make the improvement. the
benefits the improvements will provide.
and the financial demands. Adequate
advance education is crucial to the suc-
cess of public improvement programs
whether or not the city finances them by
special assessment levies.
.
Local Improvement Policy
Some cities have attempted to mJn1m1ze
the controversy over special assessment
financing by adopting an ordinance
establishing a local improvement policy. 8
A counc1l may consider such an ordi-
nance for several reasons. Fairness among
property owners requires that assessment
policy be consistent. With a frequent
turnover on the council. it is much easier
to be consistent on such finanCing if the
policy is set out in advance in an ordi-
nance. Any change in financing a particu-
lar project then requires a change in the
ordinance. a process which will focus
proper attention on the general policy
involved. If the counc1l has established
the general policy in advance. it is easier
to justify its decisions In a particular case.
Such an ordinance may also facilitate the
development of a long-range capital
program for public improvements.
A special assessment pollcy ordinance
reflects basic pol1cy decisions on financ-
ing local improvements. decisions which
the council must think through carefully.
taking into account past practice. equity.
revenue productivity. political acceptabil-
Ity. and the rest of the city's revenue
system.
.
400
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Programs Which Cities May
Finance With Special
Assessments
As a general rule. cities may only use
special assessments to finance pubUc
improvements. But. Minnesota cities may
use them in financing certain current
se:rv1ces and other programs, too.
...
LOCAl IMPROVEMENTS
The public improvements which dties
may finance through special assessment
levies are the following. 7
· Streets. sidewalks. alleys, and curbs
and gutters: Acqu1ring, opening, and
widening streets and alleys: .
constructing, reconstructing, and
maintaining sidewalks, streets,
gutters, curbs, and vehicle parking
strips. These projects may include
charges for beaut1ftcatlon. storm
sewers or other street drainage
systems, and installat10n of
connections from utilities to curb
lines.
. Storm and sanitary sewer systems:
Acqu1ring, development. construction,
reconstruction. extensio~ and
maintenance. Cities may include
outlets, treatment plants. pumps, lift
stations, and storm water holding
areas and ponds.
· St:eam heating mains: ConstruCtion,
reconstruction, extension, and
maintenance.
. Street lighting systems: Installation,
replacement. extension, and
maintenance.
. Waterworks systems: Construction,
reconstruction, extension, and
maintenance. This includes all
appurtenances of a waterworks
system. even the treatment plant.
· Parks, Playgrounds and recreational
facilities: Acquisition and
improvement of land, and purchase of
equipment and fac1llties.
· Street trees: Planting, trimming, care,
and removal.
· Abating nuisances: Includes, but not
limited to, draJning and tllling
swamps. marshes, and ponds on
public or pr:1vate property.
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CHAPTER 21
. Dikes and other flood preventions:
Construction, reconstruction.
extension. and maintenance.
. Retaining and area walls, including
highway noise barriers: Construction.
reconstruction. extension. and
maintenance.
. Parking lots: Acquisition,
construction.
. Pedestrian skyway systems:
Construction, reconstruction,
maintenance. and promotion of
bI1dges, overpasses, hallways. plazas.
elevators. and escalators.
. Underground pedestrian concourses:
Construction. reconstruction.
maintenance. and promotion of
tunnels, arcades. plazas. elevators,
and escalators.
. Malls: Acquisition. construction.
improvement. alteration, extension,
operation. maintenance, and
promotion of public malls. plazas, or
courtyards.
. Fire protection systems: Construction
in existing buildings upon petition of
owners.
A number of projects that the local
improvement code defines as local im-
provements may benefit the entire City,
such as a sewage disposal plant. intercep-
tor sewer, or a water treatment plant. The
constitutional provision author1zing
special assessments for local improve-
ments may allow these kinds of projects
as long as they confer a special benefit on
assessed property that the improvements
do not confer upon the city as a whole. 8
Another law authorizes cities to use
special assessments for acqu1ring or
constructing parking facUities.9 Cities
must use the same procedures in making
the assessments for those projects.
CURRENT' SERVICE
Cities also have statutoty authOI1ty to
recover, through special assessments, the
follOwing maintenance costs: 10
. Snow, ice, and rubbish removal from
sidewalks:
. Weed el1m1nation from streets and
prtvate property:
. Street lighting, SPrinkling. and dust
treatment:
HANDBOOK FOR MINNESOTA cITIes
· RepaJr of sidewalks and alleys:
· Trimming and care of trees and
removal of unsound trees: and
. Garbage collection. 11
A City cannot exercise this authorfty
untt1it has passed an authorizing orcU-
nance proViding that such matters are the
responsibtUty of the property owner. The
League's Local Improvement Guide con-
tains a sample ordinance on this matter.
Not all of the same administrative
procedures apply to assessments for
current servtces. However. provtsions
regarding the levy of the assessment
(except those relating to installment
payment). supplemental assessments.
reassessments. and appeals do apply.
Cities may issue bonds or other debt
instruments to finance the cost of current
servtces in the same manner as for local
improvements. With three modIfications:
· These obligations may not run for
more than two years:
· The amount of debt a city iSSues at
any one time may not exceed the
estimated cost of the work it will do
dUrfng the next six months: and
. The council must set up a separate
fund for each of the different semces
financed through this procedure.
OTHER PROGRAMS
In addition to financing public improve-
ment projects and current semces. cities
may use special assessments to:
. Construct. acquJre. reconstruct.
extend. maintaIn. and improve storm
sewers in a storm sewer district: and 12
· Construct and maintain sidewalks in a
sidewalk dtStrfct. 13
Synopsis of Procedure
The follOWing discussion is not a com-
plete guide to the proper fulftIlment of
special assessment procedures. But. it
will acquaint city otllc1a1s With the tasks
they must complete and make sugges-
tions on the effective use of special as-
sessment finanCing. The council should
consult an attorney. familtar With the
indMdual project. to make sure the city
follows all legal procedures.
Determining Economic
Feasibility
The law does not require cities to com-
plete the follOWing tasks. but they may
help the councll evaluate a proposed
public improvement project involvtng
special assessments. The purpose of these
steps is to determine whether the program
is practical. desirable. and workable.
cOnsiderfng the condition of city finances
and the taxpaying capability of the prop-
erty owners.
To make such an economic study. the
council should first prepare a report
contatn1ng the follOWing information:
· The boundanes of the area that W1ll
benefit from the project.
. The total market valuation of all lands
in the benefited area. plus the market
value of each indMdual parcel or lot:
· The kinds of land use in the area and
the percentage of land unused for
urban purposes;
. The estimated cost of the improvement
and the amount the city will finance
from the general fund;
· The total amount payable from special
assessments and the estimated levy
against each parcel of land;
. The ratio of spec1al assessments to
market valuations for the area as a
whole and for each indiVidual parcel.
and also the ratio of all outstanding
and unpaJd poor assessments. plus
the proposed one to the market value
for all land in the area and for each
indiVidual parcel;
· The estimated increase in market
value for each parcel of property if the
improvement occurs: and
· The total amount of bonds the city
intends to issue and their proposed
maturfty.
The report will indicate whether the
Proposed assessment would be too heavy
a finanCial burden on the property owners
402
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...
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.
involved. and whether the assessments
are not in excess of the amount of in-
creased market value as a result of the
improvement. The report wt1lindJcate the
financial burden the City w1l1 need to
assume. In terms of the demand upon
money in the general fund and the Impact
on the city's borrowing capacity.
Steps in Special Assessment
Proceedings
In general. the local improvement code
proposes the following steps. 14
.
Initiation of proceedings
EIther the council or a petition from
affected property owners may In1t1ate
proceedings. If a petition, it must have the
signatures of the owners of at least 35
percent in frontage of the property border-
ing the proposed tmprovements. If the
council acts on its own inItiative. an
extraordinary majority Is not necessary to
initiate the proceedings.
.
Preparation of a report
The law requires that the city engineer
or another competent person prepare a
feasibility report on the proposal. 15 It must
cover such factors as the need for the
project. the availability of necessary
money in the general fund to pay the
City's share of the cost, an estimate of that
cost. and any other information necessary
for council consideration. 16
Public hearing
The council may omit this step if 100
percent of the affected land owners sign
the petition requesting the Improvement.
The city must publish notice of the hear-
ing twice In the official newspaper, With
the notices appearing at least one week
apart. At least three days must elapse
between the last publication date and the
date of the hearing.
The city must mail a notice to each
property owner in the proposed assess-
ment area at least 10 days prior to the
hearing stating the time and place of the
hearing, the general nature of the im-
provement. and the estimated cost. At the
hearing, the council should give Inter-
ested people a chance to voice their
concerns, whether or not they are In the
proposed assessment area. 17
CHAPTER 27
Ordering the improvement and
preparation of plans
If the council began proceedings be-
cause of a petition. the council needs a
simple majority to pass a resolution for
the improvement. If the council initiated
the proceedings It will need a four-fifths
majOrity of the 'Council to pass the resolu-
tion. After this. the dty engineer should
prepare necessary plans and specifica-
tions. The council should then decide how
to do the work, and if necessary. Issue a
call for bids. 18
Time limits for local improvements
When a city council decides to make a
public improvement. It must. Within one
year of adopting the resolution ordering
the improvement. let the contract for all or
part of the work or order all or part of the
work to be done by day labor. However.
the council could specifically state a
different time frame in the resolution
ordering the improvement.
Performance of work under
contract or by day labor
The council may order the work to be
done by day labor if the estimated cost
does not exceed $25.000. if there are no
bidders on the project. or if the only bids
the council receives exceed the estimated
cost of the project. Day labor means the
city carries out a public improvement With
its own employees. or With people the city
hires specifically for that purpose. There
is no contract under this system: the city
Itself assumes full responsibility for the
work. Even using day labor. however, the
city must get bids for purchases of more
than $25,000.19
Preparation of proposed assessment rolls
Preparation of proposed assessment
rolls Is the clerk's responslbillty.2O The
council may require the clerk to conduct.
before and after market Jmprovement.
valuation studies regarding the proposed
assessment property to detennlne the
amount of special benefits.
Public hearing on the proposed assessment
The purpose of the second hearing is to
give affected property owners an opportu-
HANDBOOK FOR MINNESOTA CITIES
oity to express their concerns on the
actual special assessment levy.
The city must pub11sh notice of the
heanng. including the total cost of the
1mprovement. in the city newspaper or. 1f
none. in a county seat newspaper. one or
more times. It must also mail notice of the
heanng. including the amount of the
special assessment against the indtvtdual
parcels. possible prepayment provisions.
and the interest rate on the assessments
to each property owner at least two weeks
prior to the hearing date. The published
notice must include the hearing time.
date. place. overall project description.
area to be assessed. amount of total
assessment description of appeals proce-
dures. and any deferment options.21
In 11ght of recent court decisions. the
council may want to consider evidence of
market value improvement at this hear-
ing. The heanng notice should contain a
statement that those who wish to dispute
their assessment may notify the councll.
and the councll can then arrange for a
heanng before an impartial hearing
officer.
The property owner could then testify
concerning the improvement in market
value of the property. and the city could
do ltkewtse. The city should keep a de-
tailed record of this evidence.
Approval and certification of assessment rolls
After the pub11c heanng. the council
must approve the assessment rolls in
their final fonn so that the clerk can
certify them to the county auditor.22 The
councll should examine assessment rolls
to detenntne whether an appeal is likely
to result from a particular assessment
and whether that assessment is realistic
in view of the real estate market in the
city.
Issuance of obligations to finance the
improvement
Most cities use one of three types of
bonds to finance special assessments:
Improvement bonds. improvement
warrents. and temporary improvement
bonds.
For a full discussion of these steps. plus
a full set of model forms. see League
publication Local Improvement Guide.
.;
If the council wishes to expedite matters
or to provide better estimates of cost at
the first hearing. it may. in addition to the
required preliminary report. prepare
complete plans and specifications. adver-
tise for bids. and open and tabulate them
before the hearing.
The councll may combine into one
proceeding. an improvement on two or
more streets or different improvements on
the same or dIfferent streets. For example.
it may combine sidewalk. water. sewer.
and curb and gutter projects anywhere in
the city in one proceeding.23 Mer com-
pleting the assessment roll. the council
must divide the improvement cost be-
tween the city as a whole and the benefit
diStrict. After this the council can appor-
tion the district's share of the cost in
proportion to the estimated special ben-
efits the individual properties will receive.
.
Levying and Collecting
Assessments
Assessment rolls are lists for each
assessment project containing a descrip-
tion of each parcel of property. the name
of the property owner. and the amount of
the assessment. The clerk should prepare
a separate assessment 'roll for each im-
provement project prior to the hearing on
the assessment. After the hearing. the
council must offiCially adopt the roll. by
resolution. and then the clerk must certify
it to the county auditor.24
The clerk may use one of two methods
in certtfytng assessments to the auditor.
In the first method (which the clerk
should use unless the council directs
otheIWfse). the clerk certifies a dup11cate
copy of the assessment roll and sends it
to the county auditor. The auditor ts then
responsible for spreading the assessment
against the properties in the year in which
each installment is due. This eliminates
the clerk having to do an annual compu-
tation. and avoids errors in later years.
If the council prefers. however. it may
direct the clerk to file all the spec.tal
assessment rolls in the clerk's otTice. and
to certify annually to the county auditor
only the total amount of principal and
interest due on special assessments from
each parcel of property for the follOwing
year.25 The clerk must certify all assess-
.
404
ments to the county auditor on or before
October 10 If the auditor is to spread the
first installment on the books for collec-
tion in the followtng year. The auditor may
agree to accept a late assessment for
collection the following year. but the
auditor does not have to agree to the late
assessment. ~
.
PAYMENT OF ASSESSMENTS
Once the clerk has prepared these
special assessment rolls and the counc11
has approved them. property owners have
the option of either paying the total
amount of their assessment Immediately,
or of paying it in annual installments
under the terms the council sets. 'J:1
If the property owner pays the entire
amount of the assessment Within 30 days
after the council adopts the asseSsment
rolls. the City cannot charge any interest. 28
If the property owner pays the entire
amount at any time after 30 days. but
before any certification to the county
auditor. he or she needs to pay only the
amount of interest accrued as of the date
of payment. At any time after the certifica-
tion. the property owner may still pay the
entire amount rema1ning unpaid to the
county treasurer. In this case, however.
he or she must pay all interest which
would have accrued to December 31 of the
year in which the person makes the
payment.
If the property owner elects not to pay
the entire amount of the assessment at
once, he or she may pay it in annual
installments spread over the number of
years the council has allowed. Because
postponement of payment necessitates
city borrOWing to pay for the Jmprovement.
the city must add an interest charge to
each year's assessment payment. Interest
accrues from the time the council first
levies the assessment until December 31
of the year the property owner makes the
last payment. The council may set the
interest rate in any amount it determines.
unless a charter provision limits the
amount.29 The council should set the rate
somewhat higher than the interest the
city is paying on the special assessment
bonds. but not so high that the City w1ll
derive substantial revenue.
The council may authorize, by ordi-
nance, partial prepayment of assessments
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CHAPTER 27
prior to cert1fication to the county auditor.
The councll must also decide the num-
ber of years over which the property
owners may pay the assessment. The
statutes permit payment over a period of
not more than 30 years, but the assess-
ment should never be payable over a
period longer than the estimated life of the
improvement itself. The shorter the period
of payment, the lower the interest cost.
DEFERRED ASSESSMENTS
Under certain conditions. the counCil
may postpone the assessment of part of
the cost of water. storm sewer, and sewer
mains until a later date. This sometimes
occurs In the follOwing situations:
. Where some of the affected property is
unplatted and undeveloped. and the
city wlll subdivide or otherwise make
it available for building sites in the
future: or
. Where the city cannot use a trunk
main immediately because of the
absence of laterals.
Even jf the council plans to postpone
assessment, it must include the property
in all hearing notices on the project. The
council should be sure to include all
property which might possibly be sexved
by the main in the hearing notices so that
no property Will get free use of the main at
some future date.30 Procedures for post-
ponement of assessments are generally
Inadequate. A postponed assessment Is
not a lien against the property. When the
council decides to certify the postponed
assessment, It must follow all the proce-
dures for all property which it Will for-
mally assess.
A better procedure is to defer the as-
sessment. This procedure is as follows:31
The council must include in the proceed-
ings all property which will benefit from
the improvement. At the meeting where
the council approves the assessment, it
may levy the assessment but defer the
first installment of the assessment for
unimproved property until a designated
future year, or until the platting of the
property or the construction of improve-
ments. The council may set, by resolution,
tenns and conditions, and standards and
criteria for the deferral and future pay-
ments.
HANDBOOK FOR MINNESOTA CITIES
At the time a deferred assessment
becomes payable. It Is dtvtded Into a
number of installments so that the last
installment will be payable at a time the
council determines. but not more than 30
years after the levy of the assessment.
Interest accrues dUI1ng the deferment
peI1od. Property owners may pay Interest
either annually durtng the period of
deferment or dUI1ng the peI10d when the
assessment becomes payable. In the
resolution deferring the assessment, the
council may forgive interest for the defer-
ment years. through December 31 of the
year before the first installment Is due.
All assessments. for which the city
defers payment, are a lien on the property
on which the City lev1es the assessment.
Cities should take Special care to make
buyers aware of deferred special assess-
ments. Under the green acres law,:n or
under the law permitting deferment for
unimproved property.33 a CIty must file a
certificate stating the legal description of
property subject to deferred assessments
and the deferred dollar amounts.
If the city deferred these types of special
assessment pI10r to August 1. 1980. the
city must have filed With the county
recorder prior to January 1. 1982. a
certified list of the affected properties and
the amount of the unpaid deferment on
each property.
The act does not contain a penalty for
failure to carry out these statutory duties.
However, the intent was probably to allow
purchasers and title examiners to rely on
the records of the county recorder as to
encumbrances on property. It seems likely
that an unrecorded deferred assessment
of these two types Will be uncollectible
from someone who purchases or other-
Wise acquires property Without actual or
constructive notice of the deferred
assessment.
The irony of this statutory remedy is
that it does not require recording of the
most common deferred assessments: The
senior citizen deferred assessments34 and
deferrals under assessments for trunk
sewer and water lines until laterals permtt
connection.35 Purchasers and title exam-
Iners must still check With city clerks for
these kinds of deferred assessments as
well as for pending assessments.
The law raises the question of whether
cities should simply record all deferred
assessments With the county recorder.
That approach may be the most reason-
able. However. such action may generate
objections from landowners or from the
county recorder. who may accept for filing
only those deferred assessments the law
requires.
Additionally. unless a city uses proce-
dures for deferral under the local Improve-
ment code.38 none really exists for deferral
of assessments for trunk sewer and water
lines unttllaterals permit connections.
The assessment really takes effect when
the city decides to reimburse itself for
costs and goes through an assessment
hearing process.:n Also. for this type of
deferrals. the city may not keep all of the
eventual assessees. For example. a pro-
posed sewer near a city boundary. If
annexation occurs. the city may intend to
assess a larger area than that within its
present boundartes.
Finally, the city may intend to impose a
connection charge In lieu of a special
assessment.38 Subsequent purchasers
would be Just as affected by that charge,
but no special assessment, deferred or
otherwtse. is involved. In that case, the
county recorder's acceptance of any.
deferred assessment certificate seems
unlikely.
Because it is probably impractical to
record all deferred assessments and
charges with the county recorder. it may
be best to record only those the statutes
require.
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TAX-FORFEITED lAND RETURNED TO
PRIVATE OWNERSHIP
When ta.x-forfeited land returns to
pI1vate ownership, and the parcel benefits
from an improvement for which the city
cancelled special assessments because of
the forfeiture, the city may. with the same
noUce and heartng as for the anginal
assessment. assess or reassess the parcel.
The assessment amount would be equal
to the amount remaining unpaid on the
Original assessment. Any City may make a
reassessment or a new assessment. even
though the oI1ginal assessment occurred
under a general law or a special law other
than the local improvement code.39
406
COLLECTING ASSESSMENTS
The county auditor spreads special
assessments over the properties to which
they apply. The county treasurer collects
the assessments along with the property
taxes.
If the council uses the alternate method
of certifying assessments and directs the
clerk to file assessment rolls in the clerk's
office. all prepayments of spec1al assess-
ments. except for the installment on the
current tax list, must go to the city trea-
surer. Otherwise. all payments go to the
county treasurer who remits them to the
city treasurer with tax settlements.
.
Correction of Errors
After a city has made spec1al assess-
ments. it is sometimes possible to correct
errors or make other changes either by
levying supplemental assessments or by
ordertng a reassessment for the entire
project.4O
If. because of omissions or errors in the
assessment of any Improvement, the
council wishes to increase the amount of
assessments. It may levy supplemental
assessments. The council may levy these
assessments only after gMng property
owners noUce and a chance to be heard at
a public hearing. Requirements are the
same as those for the ortgtnal assessment.
The council may order reassessment of
all properties affected by special assess-
ment levy for any of the follOwing reasons:
. To reassess property when the courts
nul1fy the ortginal assessment:
. To validate an assessment which the
city attorney feels the city may have
made improperly or not In complIance
with JurtsdlcUonal requirements: or
. To reduce assessments the city later
determined to be excessive.
When a city levies a special assessment
against land which is later subdivided. the
council may, on Its own moUon or on
applicaUon of the owner of any part of the
tract. equitably apportion the unpaid
portion of the assessment among the lots.
The council must determine that the
apportionment will not impair collecUon
of the balance due. If the city has pledged
the assessment toward payment of bonds.
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CHAPTER 27
the council must require the owners to
furnish surety bonds.
Borrowing for Special
Assessment Purposes
CiUes may pay for most special assess-
ments over a pertod of several years.
Consequently. cities obtain funds for most
public improvement projects from bond
issues. The city pays off the bonds as the
funds become available through collection
of the assessments. and any taxes the city
levied especially for that purpose.
There are three kinds of debt instru-
ments cities use for special assessment
purposeS.41 none of which count in deter-
mining the net debt of the city. Net debt
refers to the total outstanding debt of the
city which is subject to the city debt limit.
Improvement bonds are the first kind of
debt instruments ciUes use for special
assessments. Payment of these bonds is
backed by both the specIal assessments
which the city has levied and by the
general taxing power of the city.
Improvement warrants are the second
kind. These differ from improvement
bonds in that they do not have general
taxing power and city fund backing, but
are payable only from the assessments
against the affected property owners.
Because improvement bonds are more
readily marketable at a lower rate of
interest than Improvement warrants. very
few ciUes issue Improvement warrants.
The counctl may also Issue and sell
temporary bonds at any time before
compleUon of a public improvement
project. These obligations must mature
within three years. and are payable from
the proceeds of the regular improvement
bonds which the city must issue by the
maturtty of the temporary bonds. Tempo-
rary bonds are subject to redemption and
repayment of any interest due on 30 days
maIled noUce to regIstered holders.
Unlike improvement warrants. some
cities frequently Issue temporary Improve-
ment bonds. particularly those in subur-
ban areas. By issuing these bonds. cities
can postpone the issuance of the regular
special assessment bonds. There are two
other advantages:
HANDBOOK FOR MINNESOTA CmES
. The city may consolidate several
Improvement projects Into a singIe
bond Issue: and
. The city reduces the chance of
excessive borroWing by delaying the
long-term bond Issue until It knows
all costs of a project.
Frequently, cities Will purchase their
own temporary improvement bonds With
surplus cash available In other funds,
such as a liquor or utilities fund. This
results in saVings of interest and other
investment expenses.
The City may issue regular improvement
bonds or warrants after ordering one or
more improvements.42 Generally. cities
issue them before the work Is complete
and before detenn1ning the final cost. If
the City uses this procedure and the cost
estimate turns out to be high. the city
may use the surplus funds to finance any
other Improvements it started under the
improvement code or It may transfer the
surplus to the sinking fund for the repay-
ment of the bonds themselves.43 If the cost
estimate was too low. the city may sell
additional bonds.
If the city Is involved With several public
improvements at the same time under the
local improvement code. it is advisable to
consolidate all necessary finanCing into a
single issue of improvement bonds or
warrants. even though the city hasn't
consolidated assessment proceedings. 44
Such a substantial block of bonds Is often
more readily marketable than several
smaller Issues.
Cities do not need to hold elections prior
to Issuing the bonds unless the city wtll
assess less than 20 percent of the cost of
the Improvement or improvements against
.
benefited property.45 If the city itself is to
pay 80 percent or more of the cost
through its general funds. the voters must
approve the bond issue on the Improve-
ment project.
In the resolution authorizing the issue.
the councll must decide the bond matu-
rity. denominations. interest rate. and
form.46 The factors the council should
consider in fixing such tenns include the
marketabUity of the bonds. the antici-
pated collection of the assessments. and
the need for future bond issues under the
comprehensive City plan and the capital
improvement budget.
Before it can deliver the bonds or war-
rants to the purchaser. the council must
levy a general tax for the payment of that
portion of the cost the special assessment
levies do not cover.
The council must make any tax levy for
this purpose Irrevocable for as long as the
bonds or warrants are outstanding. While
the council cannot repeal the levy until
after all of the pI1ncipal and Interest are
paid. it may reduce the tax In any year If a
surplus occurs In the sinking fund from
which the city pays the improvement
bonds.
.
Interest on Improvement Bonds.
Bonds may carty any interest rate the
council determines. 47
Interest on Special
Assessments
Special assessments may bear interest
at any rate the councll detennines. unless
the charter sets Interest limits on the
rates for assessments.
.
Special Problems
Problems commonly encountered In
using special assessments Include deter-
mining the city's share of the cost. appor-
tioning the remaining costs among the
benefited properties. levying assessments
against properties exempt from taxation.
deferring payment of special assessmentsfon senior citizen's homesteads. and
alternatives to special assessments.
DETERMINING THE CITY'S
SHARE OF THE COST
The City Itself should always bear the
cost of public improvements assessable
against city-owned and other property
exempt from special assessment levies.
The city should pay a proportion of the
cost equal to the proportionate share of
408
"
.
.
the benefit the general pubUc enjoys. The
council must detennine the extent to
which the general public benefits from
any particular improvement.
The council might consider several
public benefit aspects of streets, s~ers,
water mains, and other improvements.
Expected use of a street, for example. can
be the basic test of the amount of publ1c
benefit. An improved street that the
general public uses. not Just nearby
residents. obviously is of general benefit.
The same is true of parks. The anticipated
use of a park should determine whether
the city should charge the entire cost
against the immediate neighborhood or
whether some portion should come out of
general revenues. SIm:I1ar rules apply to
other kinds of public improvements.
Many cities have adopted the policy of
paying for all the intersections. cross-
walks, curb returns. and s1m:llar parts of
public improvement projects not immedi-
ately fronting on private property. Other
communities distribute the same costs
over the benefited district. Again. the
council should decide what is proper in
any particular case.
.
Cost Apportionment
There are two major problems in allocat-
ing the cost of public improvements. The
first is the d1v1sion of costs between the
city and the affected property owners. The
second is the division of costs among
property owners, a problem posing several
complicated questions.
For example, the counc:l1 must decide
which properties to assess in the program.
Normally. cities Include all properties
abutting or bordering on the improve-
ment. but the counc:l1 may Wish to levy
assessments against adjacent, non-
abutting properties if they benefit from the
Improvement. Furthermore, the council
must estimate the benefit each parcel of
property Will receive before detennining
individual assessments. This phase of
work includes decisions regarci:lng the
treatment of comer and odd-shaped lots.
Finally, the council must decide which of
several cost allocation procedures would
most nearly equate costs and benefits.
CHAPTER 27
DETERMINING BENEFIT DISTRICTS
Determining what area benefits from
improvement projects. the area against
which the city Will levy assessments is a
major policy decision. Levying assess-
ments against either too large or too small
a benefit district results in inequities.
Special provisions of the law ex:Ist which
allow cities to establish benefit d:lstricts
for sidewalks- and stonn sewers.49 al-
though cities can complete these types of
projects through benefit districts under
the local improvement code.
The benefit district should vaxy With the
kind of improvement. For some improve-
ments, such as a new water tank. the area
benefited m:lght be very large. In levying
an assessment to finance the tank's
construction, for example. the counc:l1 can
assess the entire area the tank services.
Water laterals, on the other hand.
benefit a small area-only the property
directly served. Their assessment should
affect only property fronting on the im-
provement. When the city installs sewer
and water trunks. the city may spread the
additional cost of the larger mains against
all properties ultimately connected by
laterals to the trunks. If the installation of
connecting laterals Will occur later, the
city may defer assessments for the propor-
tionate cost of the ma:In assignable to the
laterals.
Each city council must use its best
Judgment in setting the limits of the
district receiving special benefit. The
council should select that procedure and
those rules which Will provide the greatest
measure of equity for all property owners.
ALTERNATE COST APPORTIONMENT
PROCEDURES
Because of recent court decisions.
unless all of the property owners have
signed a waiver of appeal of the special
assessments, the city should conduct
"before and after" market improvement
valuation studies concem:lng the pro-
posed assessment area. in order to deter-
m:lne the amount of speCial benefits. The
assessment cannot exceed the special
benefits to the property measured by the
difference in market value before and after
the improvements.
HANDBOOK FOR MINNESOTA CITIES
Exempt Property
Although. the levying of special assess-
ments Is In some ways an exercise of the
taxing power. the tax exemptions the
Constitution grants to religious. chari-
table. and educational institutions do not
prevent spec1al assessments against their
property. Prtvate cemeteI1es.50 churches.
hospitals. schools. and similar Institu-
tions51 must pay special assessments.
Railroads in Minnesota are not exempt
from special assessments.
With the exception of land the United
States government owns. cities may levy
special assessments against the property
of any other government units to the same
extent as If the property were privately
owned. 52 For this purpose. "governmental
unit" refers to all cities (except Minneapo-
lis. St. Paul. and Duluth). towns. school
diStricts. pubHc corporations. and coun-
ties. If the unit doesn't pay the amount of
an assessment against It. the city may
recover the money In a civil action.
In the case of state-owned property or
property the three first class cities own.
the city should determine the amount it
would assess the land If It were prfvately
owned. Before making this determination.
the City must hold a publlc heartng on the
proposed assessment. The heanng must
take place at least two weeks after giVing
notice by registered or certified mail to the
head of the department or agency haVing
jurisdiction over the property. The
council's detennination is not binding.
however. and if the state agency or the
other City deCides that the measure of
benefit is a lesser amount. It may pay the
lesser amount. 53
In detennin1ng the assessments against
each parcel of property. the City must
Include the frontage of all property exempt
from assessment. It does not need to
include the frontage of exempt property.
however. when figunng the number of
owners who must sign the petition re-
questing the Improvement.
--. ._~--_._---
.
,.
Collection of Assessments
Against Tax-Exempt Property
When the councll has confirmed an
assessment bill. the City should mail a
notice to the owners of tax-exempt prop-
erty.54 In the case of counties. a notice
should go to the county auditor. For other
units of local government the notice
should go to the clerk or recorder. The
notice should specify the amount payable
under the assessment and the conditions
for payment, including the number and
the amount of each installment. the rate
of Interest. and the penalties for default.
Delayed Payments of Special.
Assessments on Senior
Citizen's Homesteads
A city council making a special assess-
ment has authority to defer the payment
of that assessment for any homestead
property that a person 65 years of age or
older owns and for whom it would be a
hardship to make the payment. 55 If the
city grants the deferment. it must notify
the register of deeds. The council may
detennine the amount of interest charges
on the deferred assessment.
The deferment ends and all accumu-
lated amounts. plus applicable interest.
become due upon the death of the owner
(if the spouse is not otherwise eligible for
the deferment); the sale. transfer. or
subdivision of any part of the property:
loss of homestead status on the property;
or the council's determination that imme-
diate or partial payment would impose no
hardship.
The council must adopt an ordinance
giVing general rules for granting defer-
ments and the Interest policy it will follow,
including guldelJnes for determining the
existence of a hardship. If the council
follows a policy of defernng payment of
assessments for senior citizens in hard-
ship cases. it must include a notice of
that fact in the notice of the proposed
assessment. 56
.
.
410
..
CHAPTER 27
Alternatives to Special Assessments
.
As a result of the Minnesota Supreme
Court's interpretation of the Minnesota
Constitution-that the amount of a
special assessment may not exceed the
actual Increase in market value of a parcel
of property as a result of the Improve-
ment--councils often consider alterna-
tiVes to special assessments.
Two methods receMng more attention
from city councils include general prop-
erty taxes and general obligation bonds to
pay for major improvements. and develop-
ment contracts which require a subdivider
or other developer to install allloca1
improvements to the property.
A third financing method is available for
water, sanitary sewer, and storm sewer
systems. Cities may Impose use, availabil-
ity, and connection charges to finance the
construction and operation of water and
sewer systems. 57 The advantage of this
statute is that the amounts cities charge
may exceed the benefit to the property as
long as the charge Is equitable. 58
A fourth finanCing mechanism is the
creation of an infrastructure replacement
reserve fund. A city may establish. by a
two-thirds vote of all its members. by
ordinance or resolution, a reserve fund.
.
and may annually levy a property tax for
the support of the fund. The cIty must
hold a public hearing on the question
and comply with ather procedural
requirements. 59
The proceeds of property taxes the city
levies to support this fund must go into
the reserve fund. The cIty may dedIcate
any other additional moneys to the fund.
. The tax for this fund has at various
times been allowed as a specIal levy
outside levy limits. The current treatment
of the infrastructure replacement reserve
fund levies should be checked prior to
using this financing mechanism. Before
levying the tax. the city must publish in
its official newspaper, an initial resolution
authortzlng the tax levy. Ifwithin 10 days
after the publication, a number of qual1-
fled voters greater than 10 percent of the
number who voted in the city at the last
general election file a petition with the
clerk. the council must submit the levy
question to the voters at a regular or
special election.
The council may ask the voters if the
city should dedicate the fund to any
particular type of improvement or im-
provements.
How This Chapter Applies to
Home Rule Charter Cities
The local improvement code deals with
the problem of how it applies to home rule
charter cities. Generally, any city operat-
ing under a home rule charter may pro-
ceed eIther under the localtmprovement
code,60 or under its charter in making an
improvement, unless a home rule charter
or amendment taldng effect after April 11.
1953. provtdes for an improvement under
the localtmprovement code or the charter
exclusively. 61
If an option exists. the city council must
determine whether to proceed under its
charter or the local improvement code.62
However. even if the city follows charter
procedures, state law requires that no-
tices of proposed assessments must
inform property owners of the procedures
they must fonow under the charter in
order to appeal the assessments to district
court. The notices must also inform
property owners of the provisions of the
senior citizen deferment law,63 and the
existence of any deferment procedure the
city has established.
Charter provisions must require that
when the council decides to make any
Improvement. it must let the contract for
all or part of the work. or order all or part
of the work done by day labor, no later
than one year after the adoption of the
resolution ordering such tmprovement,
HANDBOOK FOR MINNESOTA CITIES
..
unless the counctl specifically states a
different time Umlt in the resolution
ordering the Improvement. 84
The rule that the amount of special
assessment to a parcel of property cannot
exceed the increase In market value of the
property as a result of the improvement.
applies to charter cities.
Legal Notes for Chapter 27
1. MJnn. Stat. Chapter 429. See League 18. Minn. Stat. 429.031.
memo L.oca.l Improvement Guide. 515al.3. 19. Minn. Stat. 429.041.
2. See. Dun. Dig. Sec. 6850 to 6899. 20. Minn. Stat. 429.061. subd. 1.
3. Buettner V. City ofSt Cloud.. 277 N.W. 2d 21. Minn. Stat. 429.061. subd. 1.
199 (MInn. 1979): Evert 11. City of 22. Minn. Stat. 429.061. subd. 2.
Winthrop. 278 N. W. 2d 545 (MInn. 1979): 23. MInn. Stat. 429.021. subd. 2.
Trt-8Late Lumber Company v. City of 24. MInn. Stat. 429.061. subd. 3.
SlIOrt!vtew. 290 N. W.2d 775 (MInn. 1980): 25. Minn. Stat. 429.061. subd. 3.
See. .SpecUlJ Assessments" In Minnesota 26. MInn. Stat. 429.061. subd. 3.
Cities. June. 1979. pp. 30-32. 27. Minn. Stat. 429.061. subd. 3.
Mohwtnkel. et. at. 11. City of North St. PauL 28. MInn. Stat. 429.061. subd. 3.
et. aL. 375 N.W. 2d 174 (MInn. App. 29. MInn. Stat. 429.061. subd. 2: 475.55. .
1984): Lunderberg V. City ofSL Peter. 390 subd. 3. Prevtous general restrictions on
N.W. 2d 579 CMlnn. App. 1986): Holden v. Interest rates and special assessments
City of Eagan. 393 N. W. 2d 526 (MInn. were repealed by Laws 1987. Chapter
App. 1986). 334. Sections 3. 24. and 26.
4. Minn. Stat. 429.061. subels. 1 and 2: 30. Minn. Stat. 429.051.
Habel V. City ofChtsago City. 346 N.W. 31. Minn. Stat 429.061. subd. 2.
2d 668 (Mlnn. App. 1984). 32. Minn. Stat 273.111.
5. MInn. Stat. 429.061. subel. 2. 33. MInn. Stat 429.061. subd. 2.
6. See League memo. An Ord.tnance 34. Minn. Stat 435.193.
Establtshing L.oca.l IITlp1'OUement Polley, 35. Minn. Stat 429.051.
515a1.4. 36. MJnn. Stat. 429.061.
7. With the exception of parldng lots. the 37. Minn. Stat 429.051.
autho11zaUon to use spec1aJ assessments 38. Minn. Stat. 444.075.
In tlnandng the listed public 39. MInn. Stat. 429.071. subd. 4: 435.23:
Improvements Is contained In Minn. Stat. 444.076.
429.011 to 429.111. The authortty to 40. Minn. Stat. 429.071: see In re Meyer 158
finance parking lot acquisition and Minn. 433 199 N.W.'746 (1942): I.S.D.
construction Is provided In Minn. Stat. #254v. City of Kenyon. 411 N.W. 2d 545 .
459.14. (MInn. App. 1987).
8. In re Village of BumsvtJle. 254 N. W. 2d 41. See. Minn. Stat Ch. 475. and the chapter
445. Minn. 1976: Joint Ind.epen.dent In this Handbook on bonds for specific
School Dtstr1ct No. 287 v. City of Brooklyn dtaUons to the bond code. The authority
Park. 256 N.W. 2d 512, 1977. for these three kinds of debt Instruments
9. Minn. Stat. See. 459.14. Is contained In Minn. Stat. 429.091.
10. Minn. Stat. 429.101. subd. 2. Issuance of these bonds Is under
11. MJnn. Stat. 443.015. Ch. 475.
12. Minn. Stat. 444.16 to 444.21. 42. Minn. Stat. 429.091. subd. 3.
13. MJnn. Stat 471.572. 43. Minn. Stat. 429.091. subd. 4.
14. Minn. Stat. Ch. 429. 44. Minn. Stat 429.091. subd. 1.
15. Minn. Stat 429.031. 45. See Note 28.
16. Minn. Stat. 429.031. 46. Minn. Stat 429.091. subd. 3.
17. Minn. Stat. 429.031. Failure to give 47. Minn. Stat 429.091. subd. 3.
notice of this Improvement heanng wt1l 48. Minn. Stat 471.572.
Invalidate subsequent assessment 49. Minn. Stat. 444.16 to 444.21.
proceedings. and If the project Is rejected. 50. Only public cemetertes organized under
It may not be reconstdered Without Minn. Stat. 306.14 are exempt from
another heanng being held follOWing the special assessments although. under
reqUired notice. Broadbent 11. City of East Minn. Stat. 307.09.1nnd dedicated as a
Bethel. 444 N.W. 2d 602 (MInn. App. private cemetery by a private person or a
1989) . religious corporation Is also exempted to
412
..
a certain extent. See. Diocese of St. Paul.
v. St. Pcud., 138 MInn. 67. 163 N.W. 978
(1917). See also. Mlnn. Stat. 306.14.
subd. 2. which sped1lcally subjects
proflt-maldng cemeteries to spectal
assessments.
51. MInn. Stat. 429.061. subd. 4: Washburn
Memorial. Orphan Asylum V. State. 73
MInn. 343. 76 N.W. 204 (1898): State I).
Trustees of Macalester CoUege. 87 Minn.
165. 91 N.W. 484 (1902).
52. Minn. Stat. 435.19.
53. MInn. Stat. 435.19. subds. 2 and 3.
.
.
CHAPTER 27
54. Minn. Stat. 429.061. subd. 4.
55. Minn. Stat. 435.193 to 435.195.
56. Minn. Stat. 429.061. subd. 1.
57. Minn. Stat. 444.075.
58. Crown Cork and. Seal Company. Inc.. etc.
v. Ctty oflAkevt11e. 313 N.W. 2d 196
(MInn. 1981).
59. Minn. Stat. 471.572.
60. Minn. Stat. Ch. 429.
61. Minn. Stat. 429.111.
62. Minn. Stat. 429.021. subd. 3.
63. Minn. Stat. 429.021. subd. 3.
64. Minn. Stat. 429.021. subd. 3.
.
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CITY OF
SHOREWOOD
MAYOR
Barb Brancel
COUNCI L
Kristi Stover
Rob Daugherty
Daniel Lewis
Bruce Benson
5755 COUNTRY CLUB ROAD. SHOREWOOD, MINNESOTA 55331.8927 · (612) 474.3236
MEMORANDUM
.
TO:
FROM:
DA1E:
RE:
FILE NO.:
Planning Commission, Mayor and City Council
Brad Nielsen
2 September 1994
Heritage P.U.D. - Development Stage Plan and Preliminary Plat
405 (94.09)
.
As mentioned in a separate report, the proposed Council resolution for the Heritage P.U.D.
Concept Plan has been referred back to the Planning Commission for review and comment. Even
before the draft resolution had been forwarded to the Commission, the developer submitted
development stage plans and a preliminary plat for the project. While this was felt to be premature,
the City Attorney advises us that the developer has a right to submit the plans, and the City is
obligated to process them.
It is understandable that the developer wishes to expedite the process, hoping perhaps to obtain
approvals before the potential adoption of a development moratorium being considered by tb.e City.
Unfortunately, the development stage plans are not reflective of the conditions contained in the
proposed Concept Stage resolution.
The following review has been prepared without the benefit of certain information:
1 . The preliminary plat does not differentiate between City designated wetland and Wetland
Conservation Act (WCA91) wetlands. Ainong other things this distinction is essential in
evaluating the proposed density.
2. Net lot areas exclusive of City designated wetlands.
3. No proposed landscaping information has been provided.
4. No detail for the proposed pedestrian access to the wetland island common space.
5. No erosion control plan.
6. Since on-site ponding is proposed, the developer should provide storm water runoff
calculations showing how the pond was sized.
A Residential Community on Lake Minnetonka's South Shore
y
...,.
1
Re: Heritage P. U.D.
Development Stage Plans
2 September 1994 - page 2
Following is how the development stage plans differ from the conditions of the proposed Concept
Plan resolution:
a. We have not received proposed covenants or deed restrictions stating that Lot 9, Block 1 and
Lot 1, Block 2 will not be further divided.
b. The net lot areas shown on the preliminary plat appear to be based on WCA91 wetland area
rather than the City's designated wetland map. Adding all the net areas together then dividing
by the 40,000 square-foot density requirement results in an allowable lot count of 18,
including the two existing homesteads (754,000 + 40,000 = 18.85). Consequently the
I number of lots must be reduced by three. The number of allowable lots may be somewhat
higher based on the City wetland designation.
Proposed protective covenants relative to wetland protection have not been received.
The 50-foot lakeshore parcel is still shown as common area on the preliminary plat.
Lots on the east end of the proposed road comply with R-IA district requirements except for
the proposed front yard setback. Fifty feet has been recommended - 35 feet is shown.
Using R-lA setbacks for the P.U.D. Lot 10, Block 2 and Lot 1, Block 3 are considered
relatively shallow for the type of homes which have been suggested.
Lots appear to have been platted into the City's designated wetland area. Again - the
designated wetland must be differentiated from the WCA91 wetland.
Additional right-of-way, for Edgewood Road has not been provided adjacent to Lot 1,
Block 1.
Easements have not been shown for WCA91 wetlands or the proposed pond on Lot 6,
Block 2.
As a final note the proposed road has been shifted southward adjacent to Lots 5, 6 and 7, Block 1.
While this was presumably done for aesthetics, it makes the three lots to the south of it
unacceptably shallow.
In view of the preceding, approval of the Development Stage Plans and preliminary plat can not be
recommended at this time. Given the procedural deadlines imposed by our own codes and the state
statutes, it is recommended that the developer be given his choice of having the plan denied or
requesting it to be tabled pending resolution of the issues raised herein. A request to table should
be made in writing.
BJN:ph
cc: Jim Hurm
Tim Keane
Joel Dresel
Chuck Dillerud
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PRELIMINARY PLAT
Heritage P.D.D.
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Exhibit B
DEVELOPMENT PLAN
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Exhibit C
GRADING PLAN
--r .---.
MAYOR
Robert Bean
COUNCIL
Kristi Slover
Bruce Benson
Jennifer McCarty
Doug Malam
CITY OF
SHOREWOOD
5755 COUNTRY CLUB ROAD. SHOREWOOD, MINNESOTA 55331-8927 · (612\474-3236
MEMORANDUM
TO:
FROM:
DA1E:
. RE:
Planning Commission, Mayor and City Council
Brad Nielsen
30 March 1995
Manitou Woods - Preliminary Plat
FILE NO.:
405 (94.16)
Abingdon's proposal to build two twinhomes at 5580 County Road 19 had received positive
recommendations from the Planning Commission and City staff before it was suspended by the
development moratorium. Based upon the recommendations of the 27 July 1994 staff report, the
proposal is still consistent with City requirements.
The Comprehensive Plan Update impacts the proposal in two ways: 1) tree preservation!
reforestation; and 2) City water requirements.
1.
Tree Preservation and Reforestation. It is suggested that tree removal be limited to only those
which are minimally necessary to accommodate the proposed buildings, parking area and
pond. In this regard, construction fencing should be required to be placed no further than 10
feet from the proposed building pads and around the pond, as illustrated on Exhibit A;
As part of the fmal plat for this project, the developer should be required to provide a
landscape plan showing foundation planting for the units and screening along County Road
19.
.
2. City Water. The preliminary plat proposes that the twinhomes will be connected to the Tonka
Bay water system. The Comprehensive Plan Update requires new development to be
connected to Shorewood's system where feasible. Although Shorewood has no immediate
plans to extend water along County Road 19, this is an area which will be considered in the
very near future, due to the number of potential users on this segment of the system.
What has been suggested for new development where water is not available is the following:
a. The developer pays a $5000 per unit trunk: charge at the time of final plat approval.
b. Internal water main is installed with the development of the site. .
A Residential Community on Lake Minnetonka's South Shore
.
.
RE: Manitou Woods
Preliminary Plat
30 March 1995
c. A development agreement and restrictive covenant are recorded against the property
stating that connection to the system and a $5000 connection fee will be required at
. such time as the City makes water available to the site.
In view of this recommendation, the developer may wish to consider providing a
private common well for the twinhomes rather than extension of the Tonka Bay system.
cc: Jim Hurm
Joel Dresel
Tim Keane
Chuck Dillerud
- 2 -
.. "" >
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Exhibit A
PROPOSED CONSTRUCTION LIMITS
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.
MAYOR
Robert Bean
CITY OF
SHOREWOOD
COUNCIL
Kristi Slover
Bruce Benson
Jennifer McCarty
Doug Malam
5755 COUNTRY CLUB ROAD · SHOREWOOD, MINNESOTA 55331-8927 . (612) 474-3236
.MEMORANDUM
TO:
FROM:
DATE:
RE:
FILE NO.:
Planning Commission, Mayor and City Council
Brad Nielsen
30 March 1995
Smithtown Meadows - Revised Preliminary Plat
405 (94.11)
Abingdon's seven-lot plat was suspended by the development moratorium last faIl. Since then the
City approved a plat (see Jaeger Addition) which divided off the two lots with existing homes on
them. A revised plat showing the remaining five lots has now been submitted (see Exhibit A,
attached).
ANAL YSIS/RECOMMENDATION
The revised plat is identical to the layout for which approval was recommended in our 30 June
1994 staff report. Consequently the recommendations of that report (see Exhibit B) are the same,
except as follows:
1. The right-of-way issue has been resolved with Hennepin County. The developer still
- needs to obtain approval from Hennepin County for the grade crossing which aligns the
new street with Eureka Road to the north. A letter, shown as Exhibit C, has been sent to
the Railroad Authority, supporting this alignment for safety reasons.
2. The proposed street name has been changed from Eureka Way to Smithtown Way.
3. The developer has provided evidence that an old Bell Telephone easement on the east end
of the property has been abandoned (see Exhibit D).
The Comprehensive Plan Update impacts the proposed plat as follows:
a. Tree Preservation/Landscaping. Very few trees exist on the site with the exception of a
row of evergreen trees along the very north edge of the property and scattered deciduous
trees on the north side of Lots 1 and 2.
A Residential Community on Lake Minnetonka's South Shore
~... '. ~ Re.: Smithtown Meadows
Revised Preliminary Plat
30 March 1995
.
.
Based upon the proposed grading plan for the project, there appears to be no reason to
disturb trees on Lots 1 and 2. Nevertheless, these trees should be identified as part of the
final plat submission and protected during construction.
The row of evergreen trees will likely be lost to road construction. A large tree which
appears to be in the proposed street r.o.w. may also be at risk. The evergreens, although
in poor condition and sparse, do provide some screening along the railroad r.o.w. The
developer expressed some willingness to replant trees along the new road to provide future
screening for his property as well as the home located to the north of his site.
At the time the fmal plat is submitted, the developer should be required to submit a
landscape plan showing how and which trees will be protected, and the size, species and
location of proposed trees.
City Water. The City Council has directed that all new development be connected to City
water where feasible. Shorewood has water main nearby in Freeman Park. Staff is also
exploring the possibility of extending water main along Smithtown Road. Assuming the
site can be served, each lot will be required to pay a $10,000 trunkJavailability fee. The .
developer should include internal water mains within his plat as part of his utility plans. He
should also indicate whether he will petition the City to install the improvements.
Subject to the original recommendations and those contained herein, it is suggested that the
Planning Commission recommend to the City Council that the preliminary plat be approved.
b.
cc: Jim Hurm
Joel Dresel
Tim Keane
Chuck Dillerud
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Exhibit A .-
R?VISED PRE
Five remaining ~t~INARY PLAT
3>0'!>. .,.,e,
,./
.
.
Re: Smithtown Meadows
Preliminary Plat
30 June 1994
The final plat must include drainage and utility easements, 10 feet on each side of
rear and side lot lines. The developer must convince Northwestern Bell to vacate
an existing telephone easement which cuts through Lots 2, 3 and 4.
3. Park Dedication. At the time of final plat, the developer must pay park dedication
fees for five lots. Credit is given for the two lots with the houses on them.
RECOMMENDATION
Based upon the preceding, it is recommended that the preliminary plat be approved subject
to the following:
a. The developer must obtain approval for the street grade crossing from the
H. C.Ra.R.A.
b. The existing driveway encroachment is to be eliminated.
c. The proposed street name must be changed (Eureka Way is already in use).
d. Grading, drainage and utilities are subject to the recommendations of the City
Engineer.
e. As part of final plat the developer must pay $3750 in park dedication fees and $5000
in local sanitary sewer access charges. Credit has been given for the two existing
homes.
f.
The developer must provide for access to Lot 6 during construction of the street and
utilities.
g. The final plat must include drainage and utility "easements, 10 feet on each side of all
side and rear lot lines. " .
h.The developer must provide evidence that the telephone company has abandoned their
easement across the property.
1. The final pJ.3.t, including mylars, must be submitted within six months of Council
approval of the preliminary plat.
cc:
Jim Burm
Joel Dresel
Tim Keane
Chuck Dillerud
Exhibit B
PREVIOUS RECOM1\1ENDA TIONS
From 30 June 1994 staff report
- 3 -
FILE Caey
COUNCI L
Kristi Seover
ROb DaughertY
Daniel Lewis
Bruce Benson
.
CITY OF
SHOREWOOD
5755 COUNTRY CLUB ROAD · SHOREWOOD. MINNESOTA 55331-8927 . (612) 474-3236
.
9 September 1994
Mr. Ken Stevens
Hennepin County Regional Railroad Authority
Hennepin County Government Center
600 South 6th Street
Minneapolis, MN 55402
Re: Srmthtown Meadows - Proposed Grade Crossing of H.C.R.R.A. R.O. W.
Dear MI ~.. SteVens: ...-.---'
.
This is to document our conversation last week regarding the preliminary plat for
Smithtown Meadows. The developer, Abingdon Development, proposes to cross your
right-of-way, aligning their proposed street with the northerly portion of Eureka Road.
While the City of Shorewood understands the Railroad Authority's interest in minimi7.ing
grade crossings or encroachment onto its f.O. W., Shorewood feels that it is in the public
interest for the new street to align with Eureka Road. The alternative is to have the
intersection of. Eureka Road and Smithtown Road on one side of your f.O. w. and the
intersection of the new street and Smithtown Road on the other side of your f.O. W. This
proximity of two intersections.with a regional trail (current use) or a light rail line (future
use) between them clearly poses a safety hazard.
The plan presented to. you by Abingdon is the developer's response to a recommendation
by Shorewood staff. We ask, therefore, that the plan be favorably considered by the
H. C.RRA staff and the County Board.. It is my understanding that this matter will be
. co~i~d by the Board on 16 September. Please refer this letter to them for
. consideration.
As-I mentioned in our telephone conversation, if your staff have any suggestions as to how
the safety of the intersection can be improved, the City can include them in the conditions
of approval for the plat
Thank you in advance for your consideration.
Sincerely,
~OFSHOREW~
' ~ (~ .
b Bradley ~en
Planningnirector
cc: Chuck Dillerude
I /".1. I' ~'A"": \
A Residential Communit'/ on Lake M
Exhibit C
LETTER FROM SHOREWOOD TO H.C.R.R.A.
Supporting grade crossing for new street
~UG~-94 THU 13:29
. - -
P.03
lU.'LEASE OF EASEMENT
W-132
/d.
/-1'~J'/
KNOW ALL MEN BY THESE PRESENTS:
THAT WHEREAS U S WEST COHHUNlCATIONS, INC., a Colorado
corporation (hereinafter referred to as U S WEST), successor in
interest to Northwestern Bell Telephone Company, successor in
interest to the Northwestern Telephone Exc:hanqe company, is the
owner of a cer--ain easement affectinq and encumberinq property in
Hennenin County, Minnesota, described as follows:
.
Lot 1., Townsite of Eureka; also, the Southeast
Quarter of the Northeast Quar--ar (SE 1/4 of m:;
3./4) l.ying South of rail.road; also the
Southeast Quarter (SE 1/4) ~ also southeast
Quarter of the South_st Quarter (SE 1/4 of S5f
1/4) lyinq South of railroad; all in Section
32, T-ll.1N, R-23W; part. of said property is
now platted as ShOrewood Oaks, Hinnewashta,
and Lots 64, 98, 99, 100, 101, 105 and 106,
Auctitor's Subdivision No. 133.
Which said easement was granted to the Northwestern Te1.ephone
Exchanqe COmpany :by a Final Certificate dated ~, 1898 and
recorded ~, 1898, in the office of the County Recorder in and
for Hennecin County, Minnesota in Book 7a of Miscellaneous, paqe
~ as OOCUlllen~ No. 278545.
WHEREAS, U S WEST desires to re.l.ease and aCandon said
easement.
NOW, 'l'HEREl"ORE, in consideration of the SUlll of one Ool.lar and
other good and valuable consideration, the receipt and SUfficiency
whereof is hereby acknowledged, the said U S WEST does hereby
quitclaim, release and abandon the above described ea~emen:.
IN WITNESS WHEREOF, the said 0 S WEST has caused this
instrument to be duly executed as of the / t/ day of ~-r '
1.9~.
.
U S WEST COMMONI~IONS, mc.
By: 9P~
Its: Assis~ant General Manaaer
Infrastructure
Exhibit D
RELEASE OF EASEMENT
From U.S. West to Abingdon
.........-.- .-.---- -.... -.-........ ...... .....-.,... --------- ------......--
"")
MAYOR
Robert Bean
.
CITY OF
SHOREWOOD
COUNCIL
Kristi Slover
Bruce Benson
Jennifer McCarty
Doug Malam
5755 COUNTRY CLUB ROAD. SHOREWOOD, MINNESOTA 55331.8927 · (612) 474-3236
l\t1EMORANDUM
.
TO:
FROM:
DATE:
RE:
FILE NO.:
Planning Commission, Mayor and City Council
Brad Nielsen
30 March 1995
Smithtown Woods - Preliminary Plat
405 (94.21)
Clint Carlson and Brian Ohland's request to plat their properties at 25865 and 25895 Smithtown
Road into six single-family lots was suspended last fall by Shorewood's development moratorium.
A staff report, dated 1 September 1994, set forth a number of recommendations relative to the
preliminary plat (se Exhibit A).
In addition to the original recommendation, the Comprehensive Plan Update affects the proposed
division as follows:
.
City Water. The City Council has directed that all new development be connected to City
water where feasible. It appears that water may be able to be extended from the main in
Freeman Park, or possibly from an extension along Smithtown Road. The developer
should include plans for internal water main within his plat. Assurping the City can serve
the property with water, a trunk/availability charge of $10,000 for each new lot will be
required at the time of fmal plat. The existing homes would be charged $5000 each. Staff
is exploring the feasibility of allowing a delayed payment of up to three years on the
charges for the existing homes.
2. Tree PreservationlReforestation. The developers have shown general locations of tree
clusters on their preliminary plat (see Exhibit B). There are, however, additional trees on
the site which have not been shown on the plans.
1.
It is recommended that the developers submit a detailed tree inventory identifying the size,
species and condition of all trees over six inches in diameter located on the site. Based
upon a proposed grading plan, it will not be necessary to inventory trees in areas which
will not be disturbed by grading or utility construction. Those areas will be required to be
fenced off prior to commencement of any construction activity.
A Residential Community on Lake Minnetonka's South Shore
"'..
.
.
Re: Smithtown Woods
Preliminary Plat
30 March 1995
From this inventory the developer must prepare a reforestation plan showing how larger
trees will be preserved in areas which will be disturbed by grading. Given the flatness of
the site, it is. not anticipated that significant tree loss will occur outside of the street right -of-
way.
In the next sixty days the City should develop its policy for tree replacement and
landscaping.
cc: Jim Hurm
Joel Dresel
Tim Keane
Clint Carlson
- 2 -
711,
. As a condition of approval of the plat it is recommended that the existing driveways which
access Smithtown Road directly be relocated so as to access the new street
RECO!vllv1ENDATION
This plat would be subject to delay if the moratorium which is currently.under consideration by
the City is adopted. Consequently it is assumed that the Planning Commission will wish to table
the application pending the outcome of the moratorium. In the meantime the developer should be
directed to revise his preliminary plat, showing the change in the north end of the road and the
straightened lot line between Lots 1 and 2.
Also. the preliminary plat should include a statement that it shows All existing easements and
encroachments on the site. It currently includes a disclaimer for such items.
When a final plat is submitted it should include the following:
1. Detailed grading, drainage. erosion control and utility plans and specifications. including
stormwater runoff calculations.
e
2. Drainage and utility easements 10 feet along each side of each side and rear lot line.
3. Estimates of construction costs for streets, grading and utilities. From these estimates a
letter of credit or cash security will be required to guarantee completion of the
improvements.
4. Mylar originals of the final plat for signature by the Mayor and City Clerk.
5. An up-to-date (within 30 days) title opinion or title commitment for review by the City
Attorney.
6. Warershed District apprOvaL
7. Lot size certification by the applicant's surveyor.
e.
Re: Smithtown Woods
Preliminary Plat
1 September 1994 - page 3
All of these items must be provided within six months of preliminary plat approval. Once
received, staff will prepare a standard development ~oreement for the project Prior to release of
the final plat, park dedication fees ($3000) and sewer access charges ($4000) must be paid by the
applicant
BJN :ph
cc: Jim Hurm
TllIl Keane
Joel Drese1
Clint Carlson
Mark Gronberg
Exhibit A
RECOMMENDATION FROM 9/1/94
STAFF REPORT
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LiGAL D~SCRIPTION
That part of the SOt
Town.hip 117, Rans,
follows: Besinnin~
the Chicaso, and No.
Ainneapolis Go S~, L.
alan, .aid Northwes'
the South line of .:
thence Southwesterl
distance of 75 feet;
de.ree. 06 minute. ~
said center line i.
Shady lawn H.nor: tho
intersection with .
s.id Southea.t Quar
besinnin.: thence S.
be,innin.. accordinl
County. Hinne.ota.
ALSO,
That part of the SO'
32. Town.hip 117 NOI
d..cribed .. followr
of s.id Southeast Qt
the We.t 199 f.et oi
thence Bast along Sp
of -way line of the f
NOrth..aterly alons
153 feet: thence d~f
centerline of Smitht
to its intersection
South to the point r
This survey" show. 1:1
~escribed propertieF
improvements or ener
Owners:
'Brien J. Ohland
19875 Smithtown Rd.
Shorewood, Hinn. 55j
Clinton A. & Jenet'r
202 Peninsula Rd.
Medicine Lake. Minn.
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Exhibit B
PRELIMINARY PLAT
Recommended revisions shown
iI. 88. 56' 30. e:
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