HomeMy WebLinkAbout8A - Proposal to Adopt a Street Reconstruction Plan
4646 Dakota Street S.E.
Prior Lake, MN 55372-1714
CITY COUNCIL AGENDA REPORT
MEETING DATE:
AGENDA #:
PREPARED BY:
JULY 7,2008
8A
STEVE ALBRECHT, DIRECTOR OF PUBLIC WORKS
AGENDA ITEM:
PUBLIC HEARING TO CONSIDER THE PROPOSAL TO ADOPT A STREET
RECONSTRUCTION PLAN AND ISSUE GENERAL OBLIGATION STREET
RECONSTRUCTION BONDS
DISCUSSION:
Introduction
The purpose of this agenda item is to take public input on the proposed
reconstruction plan with the intent to issue general obligation street
reconstruction bonds for these projects.
Historv
In 2002, the Legislature made a variety of changes in the powers of local
governments to issue bonds and incur other forms of debt. A new subdivision
3b was added to Minnesota Statutes, Section 475.58 authorizing municipalities
to issue bonds without a referendum to finance street reconstruction programs
(see also, Laws of Minnesota for 2002, Chapter 390, Section 18). The 2003
Legislature clarified that street reconstruction bonds may be issued for utility
replacement and relocation and other activities incidental to the street
reconstruction, but does not include the portion of project cost allocable to
widening a street or adding curbs and gutters where none previously existed.
Granting municipalities the authority to issue bonds under Minnesota Statutes,
Chapter 475 for street reconstruction without regard to election requirements
affords cities the opportunity of financing this type of improvement without
having to specially assess at least 20% of the project costs. The bonds may
only be issued if the following conditions are met: a unanimous council vote,
that the work to be done is part of the reconstruction plan, a public notice is
provided, reverse referendum is authorized, and the amount to be financed is
subject to the municipalities net debt limit, even if they would be exempt under
another law.
Current Circumstances
The law authorizes issuance of obligations without an election for
reconstruction of streets, if the bonds are issued under a five-year Street
Reconstruction Plan and the conditions provided above are met.
The following table identifies the financing elements of the Street
Reconstruction Plan:
R:\Council\2008 Agenda Reports\07 07 08\Street Recon Agenda.doc
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Year
Improvement
Total City Cost
Estimated
Bonding
$700,000
$500,000 I
$0 I
$50,000 I
$50,000 I
$1,275,000 I
$175,000
$250,000
$1,250,000
$250,000
$900,000
$1,025,000
$1,100,000
$800,000
$8,325,000.00* 1
Brooksville Hills Phase 2 $2,100,000
CR 21/Arcadia Design & ROW $500,000
CR 21/Main Study $75,000
CR 21/Fountain Hills Design $50,000
CR 42/McKenna Design $50,000
CR 12 Reconstruction $4,175,000
CR 21 Extension $1,075,000
CR 42/McKenna Intersection $250,000
CR 21/Arcadia Intersection $1,550,000
CR 21/Fountain Hills Int. $250,000
Industrial Park Reconstruction $1,950,000
TH13/Main Ave Intersection $1,675,000
Shady Beach Phase 1 $2,075,000
Downtown South $1,975,000
Total $17,750,000.00
* Total Bonding includes 429 and Street Reconstruction Bonds
The total estimated Street Reconstruction Bonds to be issued over the five-
year plan is $3,550,000.
2009
2009
12009
12009
12009
I 2010
I 2010
12010
I 2011
I 2011
I 2012
12012
2013
2013
Issuing general obligation bonds is another mechanism to fund street
reconstruction projects. Adopting a Street Reconstruction Plan with the intent
to issue general obligation street reconstruction bonds does not require the
City to utilize this mechanism. It simply provides the Council with another
funding option. The City could elect to specially assess for these projects even
if the City Council approves this resolution. The City must also follow
Minnesota State Statutes 429 for projects which the City intends to specially
assess.
Conclusion
Adopting a Street Reconstruction Plan is necessary to utilize general obligation
street reconstruction bonds for any of the projects identified in the Street
Reconstruction Plan. Staff recommends that the Street Reconstruction Plan
be adopted.
FINANCIAL
IMPACT:
Assessments for some of the upcoming County Road projects may not reach
the 20% threshold for special assessment. In those cases this mechanism
can be utilized to fund the City's portion of the improvements.
1. Approve a resolution adopting the Street Reconstruction Plan.
2. Table this agenda item for a specific reason.
3. Deny this agenda item for a specific reason and provide staff with direction.
ALTERNATIVES:
RECOMMENDED Alternative # 1.
MOTION: I
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Frank Boyles, ty M' na. r
R'lcounCifl200e R, ortsl07 07 OBIStreet Ream Agenda.doc
Motion By:
Second By:
WHEREAS, The following table identifies the Street Reconstruction Plan financing elements:
Year
12009
12009
12009
12009
12009
I 2010
12010
I 2010
I 2011
I 2011
I 2012
2012
2013
2013
Improvement
Brooksville Hills Phase 2
CR 21/Arcadia Design & ROW
CR 21/Main Study
CR 21/Fountain Hills Design
CR 42/McKenna Design
CR 12 Reconstruction
CR 21 Extension
CR 42/McKenna Intersection
CR 21/Arcadia Intersection
CR 21/Fountain Hills Int.
Industrial Park Recon
TH13/Main Ave Intersection
Shady Beach Phase 1
Downtown South
Total
Total City Cost
$2,100,000
$500,000
$75,000
$50,000
$50,000
$4,175,000
$1,075,000
$250,000
$1,550,000
$250,000
$1,950,000
$1,675,000
$2,075,000
$1,975,000
$17,750,000.00
Estimated
Bonding
$700,000
$500,000
$0
$50,000
$50,000
$1,275,000
$175,000
$250,000
$1,250,000
$250,000
$900,000
$1,025,000
$1,100,000
$800,000
$8,325,000.00
WHEREAS, Issuing general obligation bonds is another mechanism to fund street reconstruction
projects. Adopting a Street Reconstruction Plan with the intent to issue general
obligation street reconstruction bonds does not require the City to utilize this
mechanism; and
WHEREAS, The total estimated general obligation bonds for the 5 year program is $3,550,000; and
WHEREAS, Street reconstruction is necessary to provide residents the opportunity of safe travel
while commuting throughout the City.
NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE,
MINNESOTA as follows:
1. The recitals set forth above are incorporated herein.
2. The City Council authorizes the adoption of the Street Reconstruction Plan with the intent to issue
general obligation street reconstruction bonds.
PASSED AND ADOPTED THIS ih DAY OF JULY 2008.
YES
I Haugen
I Hedberg
I Erickson
I LeMair
I Millar
NO
Haugen
Hedberg
Erickson
LeMair
Millar
Frank Boyles, City Manager
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