HomeMy WebLinkAbout5G Welcome Industrial Park Assessment Hearing O� P ��$
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Prior Lake. MN 55372
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CITY COUNCIL AGENDA REPORT
MEETING DATE: MARCH 25, 2013
AGENDA #: 5G
PREPARED BY: KATY GEHLER, PUBLIC WORKS � NATURAL RESOURCES DIRECTOR
PRESENTED BY: KATY GEHLER
AGENDA ITEM: CONSIDER APPROVAL OF A RESOLUTION DECLARING COSTS TO BE AS-
SESSED AND SETTING A DATE FOR THE ASSESSMENT HEARING RELATED
TO THE WELCOME INDUSTRIAL PARK IMPROVEMENTS, CITY PROJECT
#12-012
DISCUSSION: Introduction
The purpose of this agenda item is to ask the City Council to consider approval of
a resolution declaring costs to be assessed and calling for the assessment hear-
ing related to the Welcome Industrial Park Improvements.
His tOry
On August 15, 2011, the City Council placed the Welcome Avenue Utility Exten-
sion in the CIP for 2012. This project contemplated the extension of water and
sanitary sewer along Welcome Avenue and Credit River Road to serve the re-
maining parcels. This project did not include improvements to the road surfaces
or accommodate surFace water runoff from the area.
On October 17, 2011 the City Council ordered an update to the 2007 Feasibility
Study in preparation for the 2012 project. Through this process several work ses-
sions took place to discuss potential components of the project, benefits, and syn-
ergies with other City priorities including:
1. Wellhead Protection Plan Compliance
2. Markley Lake Flood Protection Strategy
3. Economic Development Potential
4. Code Enforcement
5. Future Annexation Potential
In February of 2012 the City completed representative appraisals to gauge the
special benefit of each of the project components to the adjacent property owners.
The Assessment Committee reviewed the information provided and discussed the
method of assessment. Due to the varied nature of the industrial parcels, an as-
sessment rate based on a dollar per area was recommended. In addition the
committee felt that due to the benefit of the public water supply, a greater portion
should be borne by the water fund, thus reducing the water and sewer portion of
the assessment.
The City Council reviewed the various options for the project at a May 7, 2012
work session and provided feedback on the draft feasibility study and projected
assessment methodology.
On October 24, 2012 and November 19, 2012 two project forums were held. In-
formation regarding the need for the project was presented and the participants
contributed to an Implications Wheel exercise. 14 of the property owners pro-
posed to be assessed were represented along with several others impacted by the
project.
On November 13, 2012 the City Council accepted the Feasibility Study and set the
date for the Improvement Hearing. The hearing was held on December 10, 2012
and the Council adopted a resolution ordering the project and preparation of plans
and specifications.
On February 25, 2013 the City Council approved the final plans and specifications
and authorized staff to advertise for bids.
Current Circumstances
The final plans and specifications for the Improvements have been completed and
are out for bids. The attached figure shows the proposed improvements. Bids will
be received on April 2, 2013. The next step in the project process is to declare
the costs to be assessed and call for the Assessment Hearing. The Assessment
Hearing gives property owners an opportunity to express concerns about the ac-
tual special assessment. Pending approval of the proposed resolution, a 14 day
mailed notice of the hearing will be sent to the impacted property owners along
with the preliminary assessment roll.
The proposed improvements are considered new development under the current
assessment policy which allows up to 100% of the costs of the project to be as-
sessed. A unit assessment, equal to each parcel, was originally considered for
this project. However, significant disparities between the sizes and current devel-
opment statuses of the existing lots would likely not equate to equal benefits to
each lot supporting a per lot assessment rate. Therefore an area-based assess-
ment method has been contemplated that considers the developable area (or ad-
justed area) of each parcel.
Representative appraisals were completed to gauge the special benefit of the pro-
ject options and determine whether assessment of 100% of the project cost could
be supported by the special benefit test. Two lots were chosen to represent the
potential high and low benefit from the improvements. The rates were broken into
three components: Streets (including storm sewer), water and sewer, and region-
al stormwater improvements.
Total special benefit for the project area was estimated by applying the rates of
the representative appraisals, totaling $1,500,000. The Special Assessment
Committee reviewed the results and recommended a reduction in the assessed
rate for the water and sewer component, supported with additional funding from
the Water Fund due to the Wellhead Protection benefit. Project funding has been
developed under this direction considering a total assessment amount of
$1, 000, 000.
The purpose of this action is to indicate the amount to be assessed and set a date
and time for the Assessment Hearing. The Hearing is proposed for April 22,
2013. The Council will be asked to award the construction contract and adopt the
�,
assessments on May 28, 2013. At any point prior to the contract award the Coun-
cil may decide not to proceed.
Conclusion
Declaring the costs to be assessed and setting the date and time for the Assess-
ment Hearing is the next step in the project process and is a requirement of the
429 process. Staff is recommending approval of the resolution to allow the project
to continue on schedule. The Council will have the opportunity to review the bid
costs and project funding and provide feedback at a subsequent meeting.
ISSUES: This project has shown to be complex as it has several driving forces, opportuni-
ties and funding concerns. These issues were reviewed with the Council at the
May 7, 2012 Work Session. A copy of the report can be found on the City's La-
serFiche site.
FINANCIAL The project cost is estimated at $2,161,000. Funding for this project is proposed
IMPACT: to come from the Water Fund, Water Quality Fund, Trunk Fund, 429 Bonding and
assessments. The table below shows the preliminary financing breakdown.
Preliminary Financing
Water Fund $600,000
Water Quality Fund (Stormsewer upsizing) $50,000
Watermain Trunk Fund (Watermain upsizing) $20,000
Sewer Trunk Fund (Sewer extra depth) $20,000
Storm Trunk Fund (Markley Lake Flood Protection) $301,000
Potential Assessments $1,000,000
429 Bonding $170,000
An updated funding table will be prepared once bids are received.
ALTERNATIVES: 1) Approve a Resolution declaring the costs to be assessed and setting the date
for the Assessment Hearing related to the Welcome Industrial Park Improve-
ments.
2) Deny this item for a specific reason and provide staff with direction.
3) Defer this item until a future date.
RECOMMENDED Alternative No. 1.
MOTION:
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4646 Dakota Street SE
`�I�so'��' Prior Lake, MN 55372
RESOLUTION 13-xxx
A RESOLUTION DECLARING COSTS TO BE ASSESSED AND ORDERING PREPARATION OF
PROPOSED ASSESSMENT ROLL FOR THE WELCOME INDUSTRIAL PARK IMPROVEMENTS,
PROJECT 12-012, AND ESTABLISHING THE DATE OF THE ASSESSMENT HEARING AND
PUBLICATION THEREOF
Motion By: Second By:
WHEREAS, Estimated costs have been calculated for the Welcome Industrial Park improvements,
Project 12-012, the City cost for the improvements are $2,161,000.00; and
WHEREAS, The City Manager notifies the City Council that such proposed assessment will be
completed and filed in the City Manager's office for public inspection.
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 portion of the cost of such improvements to be paid by the City is hereby declared to be
$2,161,000.00, and the portion of the cost to be assessed against benefited property owners is
declared to be $1,000,000.00.
3. Assessments shall be payable on an equal principal installment method extentling over a period of 10
years for street improvements and 20 years for sewer and water improvements. The first installment
shall be the annual principal plus interest calculated from the public hearing date to the end of this year
plus twelve months of the next year and shall bear interest at the rate of 3.98% per annum from the
date of the adoption of the assessment resolution.
4. The City Manager, with the assistance of the Public Works Director, shall forthwith calculate the proper
amount to be specially assessed for such improvements against every assessable lot, piece or parcel
of land within the district affected, without regard to cash valuation, as provided by law, and shall file a
copy of such proposed assessment in the office of the City Manager for public inspection.
5. The City Manager shall upon the completion of such proposed assessment notify the City Council
thereof.
6. A public hearing shall be held on the 22�d day of April, 2013, in City Council Chambers at 7:00 P.M. to
pass upon such proposed assessment and at such time and place all persons owning property affected
by such improvement will be given the opportunity to be heard with reference to such assessment.
7. The City Manager is hereby directed to cause a notice of the public hearing on the proposed
assessment to be published once in the official newspaper of the City at least two weeks prior to the
hearing, and the City Manager shall also cause mailed notice to be given to the owner of each parcel
descnbed in the assessment roll not less than two weeks prior to the hearing.
8. The owner of any property so assessed may, at any time prior to certification of the assessment to the
County Auditor, pay the whole of the assessment on such property, with interest accrued to the date of
payment, to the City Finance Director, except that no interest will be charged if the entire assessment is
paid within 30 days from the adoption of the assessment. The owner may, at any time thereafter, pay
http://splashlteams(am/October 4 2010/March 25, 2013M/elcome Declare Assessment Hearing RES.docx
to the City Finance Director the entire amount of the assessment remaining unpaid, excepting the
installment portion appearing upon the current year's property tax statement.
PASSED AND ADOPTED THIS 25T" DAY OF MARCH 2O13.
YES NO
Hedber Hedber
Keene Keene
McGuire McGuire
Morton Morton
Souku Souku
Frank Boyles, City Manager
2
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