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Home My WebLink About5F Special Assessments for Mr. Dennis OzbunFRIO ti U 4646 Dakota Street SE Prior Lake. MN 55372 �INIVESO� CITY COUNCIL AGENDA REPORT MEETING DATE: NOVEMBER 21, 2011 AGENDA #: 5F PREPARED BY: JERILYN ERICKSON, FINANCE DIRECTOR PRESENTED BY: JERILYN ERICKSON AGENDA ITEM: CONSIDER APPROVAL OF A RESOLUTION AUTHORIZING THE DEFERRAL OF SPECIAL ASSESSMENTS FOR MR. DENNIS OZBUN DISCUSSION: Introduction The purpose of this agenda item is to consider the requests by property owners in the Boudin's Neighborhood Improvements, Phase I project area to defer their special assessments. Histo City of Prior Lake Code 111.100 provides for a deferral of special assessments on homestead property owned by a person who qualifies under one of the hardship criteria set forth in subsections 111.200 and 111.300. Section 111.200 1. Any applicant must be sixty -five (65) years of age, or older, and must own a legal or equitable interest in the property applied for which must be the homestead of the applicant. 2. The annual gross income of the applicant shall not be in excess of the income limits as set forth by family size for the City of Prior Lake, At- tachment A to Ordinance 86 -03 (adjusted annually in conjunction with the Minneapolis -St. Paul Consumer Price Index). Calculation of the to- tal family income shall be determined by the summation of all available income sources of the applicant and spouse. Income specified in the application should be the income of the year preceding the year in which the application is made, or the average income of the three (3) years prior to the year in which the application is made, whichever is less. 3. The total special assessments to be deferred exceed one thousand dollars ($1,000.00). Section 111.300 Exceptional and Unusual Circumstances For any individual who does not qualify under the conditions set forth in subsection 111.200, the following conditions may qualify an applicant for assessment deferral. A hardship is deemed to exist if the applicant meets all of the following conditions: 1. An applicant must be retired by reason of permanent and /or total disa- bility and must own a legal or equitable interest in the property applied for which must be the homestead of the applicant. 2. Same as above. 3. Same as above. Per City Code 111.101, an application for deferral of special assessments must be made within thirty (30) days after the adoption of the assessment roll by the City Council. The City Council adopted the special assessments for the Boudin's Neighborhood Improvement, Phase I project ( #11 -011) on October 17, 2011 so property owners have until November 17, 2011 to submit an application. Current Circumstances As of the date this agenda report was prepared, only one (1) special assessment deferral application had been received as follows: File No. Name' : ProperEy Address ' Pit) Legit Descrip- 1ion 11 -001 Dennis Ozbun 14415 Watersedge Trail NE 25- 119 -0290 Boudin's Manor Lot 033 If any additional applications are received by the due date of November 17, 2011, City Staff will present this information at the City Council meeting. City Code 111.200 provides the criteria that must be met in order to meet the hardship determination. Mr. Ozbun currently meets all of the criteria. Conclusion 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 Manager for those cases whereby the original conditions for qualifications remain substantially un- changed. ISSUES: Mr. Ozbun currently meets all of the criteria established by City Code 111.200 for the hardship determination. Historically, when deferments have been granted, both the principal and interest portions have been deferred. Interest is accrued during the normal term of the special assessment. A renewal application must be received from Mr. Ozbun no later than September 30 of each year in order to maintain the deferred status. Upon Council approval, Staff must submit a notice to Scott County identifying the property for which the assessment is being deferred by November 30, 2011. FINANCIAL Special assessments, in addition to the annual debt service tax levy, are the fund - IMPACT: ing sources for the repayment of General Obligation Bonds, Series 2011A, that were issued to finance the Boudin's Neighborhood Improvement, Phase I project ( #11 -011). Granting a deferral for paying a special assessment delays the receipt of funds to make the annual debt payments. Consequently, the annual debt service tax levy must be increased to make up for this deferral. Upon the termination of deferral, all amounts accumulated plus applicable interest becomes due and payable and, thus, available to pay any remaining debt service. If there is no remaining debt service, the Council would have authorized the closure of the fund and the transfer of any residual account balances; thus, the payment of the deferred assessments would be recorded in the new fund as previously authorized by the Council. ALTERNATIVES: The following alternatives are available to the City Council: 1. Adopt a Resolution Approving the Deferral of Special Assessments for Mr. Dennis Ozbun. 2. Table this item for a specific reason. RECOMMENDED Alternative 1. MOTION: PRI0 U �l� 4646 Dakota Street SE Prior Lake, MN 55372 RESOLUTION 11 -xxx RESOLUTION AUTHORIZING THE DEFERRAL OF SPECIAL ASSESSMENTS FOR MR. DENNIS OZBUN WHEREAS, City of Prior Lake Code 111.100 provides for a deferral of special assessments on homestead property owned by a person who qualifies under one of the hardship criteria set forth in subsections 111.200 or 111.300; and Motion By: Second By: WHEREAS, Property owned by Mr. Dennis Ozbun has been specially benefitted by the Boudin's Neighborhood Improvements, Phase I (City Project #11 -011); and WHEREAS, The property identified as PID #25- 119 -0290 has accordingly been assessed in the amount of $8,427.00 (Resolution #11 -123); and WHEREAS, City Staff has reviewed the application and finds that it meets the criteria set forth in City Code 111.200 or 111.300; and WHEREAS, City of Prior Lake Code 111.400 provides for the termination of deferral. 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 special assessments, including the accrued interest, will be deferred until the occurrence of any one of the events provided for in City Code 111.400. 3. The City Manager is directed to administer the deferment in accordance with State Statute and City Code. PASSED AND ADOPTED THIS 21st DAY OF NOVEMBER, 2011. YES NO ser M ser Erickson Erickson Hedber — Hedberg Keeney Keene Soukup Souku Frank Boyles, City Manager