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HomeMy WebLinkAbout9B Development Fee Ordinance Amendment Report Phone 952.447.9800 / Fax 952.447.4245 / www.cityofpriorlake.com 4646 Dakota Street SE Prior Lake, MN 55372 CITY COUNCIL AGENDA REPORT MEETING DATE: AUGUST 21, 2017 AGENDA #: 9B PREPARED BY: CASEY MCCABE, COMMUNITY DEVELOPMENT DIRECTOR PRESENTED BY: CASEY MCCABE AGENDA ITEM: CONSIDER APPROVAL OF AN ORDINANCE AMENDING SUBSECTION 106.600 RELATING TO DEVELOPMENT FEES, AMENDING SUBSECTION 704.200 RELATING TO CONNECTION AND AVAILABILITY CHARGES DUE ON DEVELOPMENT AND A RESOLUTION APPROVING A SUMMARY OF THE ORDINANCE AND AUTHORIZING ITS PUBLICATION DISCUSSION: Introduction The purpose of this agenda item is to consider amendments to the City Code related to certain development fees. History The City of Prior Lake Subdivision Code identifies specific requirements related to the installation of water, sanitary sewer and stormwater improvements in new subdivisions. In addition, the Subdivision Code requires an acreage charge, dedicated to the Trunk System Fund, which is collected as part of the Development Contract on all new subdivisions. The purpose of the Trunk System Fund is to pay for central system improvements essential for the functional operation of the entire municipal water, sanitary sewer and stormwater system. Current Circumstances Development fees, including park dedication; trunk fees (sewer, water and stormwater); street oversizing; utility connection charges and city administration and construction observation fees are collected when properties are subdivided for development. Prior Lake has a few lots in the community that have not been subdivided and platted but are still considered buildable lots. The development fees are not currently collected if a property is not required to subdivide or plat prior to development. Conclusion The purpose of the proposed ordinance amendment is to clarify that certain development fees, such as trunk sewer, water and stormwater charges and utility connection charges are due on development of the property; not at subdivision of the property. The proposed amendment identifies ‘Utility Development Fees’ which are due upon subdivision or development. The utility development fees will not be imposed if the fees were paid or assessed with previous development of the property. The utility development fees are 2 not proposed to be imposed for property development in a residential or agricultural district except upon platting or subdivision. ISSUES: The attached ordinance amendment clarifies the city will be collecting utility development fees upon development of non-platted property. The ordinance centralizes and clarifies the regulations for ease of administration and understanding. This ordinance identifies which fees are due upon subdivision of property and which fees are due on development where subdivision may not be required. Some city fees, such as Park Dedication, which is identified in State Statute Subdivision Regulations, will not be collected unless properties are being subdivided. If there is sufficient time available during the work session, the staff would like to review our development fees with the city council since we have not taken the opportunity to do so in quite some time. If there is insufficient time then we will reschedule the discussion or remaining discussion to a future work session. FINANCIAL IMPACT: City staff does not anticipate a significant amount of commercial development on un-platted property; however, over the years the City will see an increase in its Trunk System Fund because of the proposed amendments. The development fees which have previously been approved by the City Council will not change because of this amendment. The only change to the Official Fee Schedule is to identify Utility Development Fees within the Development Fees category to clarify which fees are due upon subdivision and which are due upon development. ALTERNATIVES: 1. Motion and second to adopt the ordinance and resolution as proposed, or as may be amended by the City Council. 2. Motion and second to deny the ordinance and resolution. 3. Motion and second to table the item and provide staff with direction. RECOMMENDED MOTION: Alternative #1. ATTACHMENT: 1. Proposed Amendments to Section 704 4646 Dakota Street SE Prior Lake, MN 55372 CITY OF PRIOR LAKE ORDINANCE NO. 117-______ AN ORDINANCE AMENDING CITY CODE SUBSECTION 106.600 RELATING TO DEVELOPMENT FEES, AMENDING CITY CODE SUBSECTION 704.200 RELATING TO CONNECTION AND AVAILABILITY CHARGES DUE ON DEVELOPMENT AND ADOPTING BY REFERENCE CITY CODE PART 1 WHICH, AMONG OTHER THINGS, CONTAINS PENALTY PROVISIONS THE CITY COUNCIL OF THE CITY OF PRIOR LAKE, MINNESOTA, ORDAINS: 1. City Code Part 1, Subsection 106.600 is amended by deleting the fees related to Development Fees and replacing them with the following: DEVELOPMENT FEES: Administration Fee on Development Agreements 4.0% Administrative Charge for No-Notice to Commence Construction for Utility Connections $100.00 Construction Observation and Professional Service Fee on Development Agreements Minimum of 5.0% or such larger amount as desired by the developer Escrow for Preliminary and Final Plats 3 lots or fewer $1,000.00 4 - 10 lots $2,500.00 11 or more lots $5,000.00 Park Dedication Fee Residential $3,750.00 / unit Commercial/industrial $6,400.00 / ac. Street Oversize Acreage Charge $5,953.00 / ac. UTILITY DEVELOPMENT FEES: Trunk Sewer Acreage Charge $3,678.00 / ac. Trunk Water Acreage Charge $6,960.00 / ac. Trunk Stormwater Acreage Charge Low density residential (R1, R2) $3,376.00 / ac. High density residential (R3) $5,566.00 / ac. Commercial/industrial $6,994.00 / ac. Utility Connection Charge - Sanitary Sewer $9,000.00 Utility Connection Charge - Water $9,000.00 Page 2 of 2 2. Subsection 704.200 (CONNECTION AND AVAILABILITY CHARGES DUE ON DEVELOPMENT) of the Prior Lake City Code is deleted in its entirety and replaced with the following: Certain City sanitary sewer, water and storm water connection and availability charges are due on development of property (“Utility Development Fees”). For purposes of this subsection the term development shall include but not be limited to the following: construction, installation, addition, modification, rehabilitation or alteration of a building or structure on the property; change in use of the property or a structure or building on the property; alteration, grading or excavation of the property; and subdivision or platting of the property. Utility Development Fees shall not be imposed if the fees were paid or assessed in conjunction with previous development of the property. Utility Development Fees shall not be imposed for property in a residential or agricultural district except upon platting or subdivision. All Utility Development Fees shall be set forth in the City fee schedule and shall be in addition to any connection and availability charges due with permit or work or those imposed by the Metropolitan Council. 3. City Code Section 104 entitled “General Penalty” is hereby adopted in its entirety, by reference, as though repeated verbatim herein. This ordinance shall become effective from and after its passage and publication. Passed by the City Council of the City of Prior Lake this 21st day of August 2017. ATTEST: _________________________ __________________________ Frank Boyles, City Manager Kirt Briggs, Mayor A summary of this ordinance was published in the Prior Lake American on the 26th day of August 2017. 4646 Dakota Street SE Prior Lake, MN 55372 RESOLUTION 17-____ A RESOLUTION APPROVING THE SUMMARY OF ORDINANCE NO. _____ AND ORDERING THE PUBLICATION OF SAID SUMMARY Motion By: Second By: WHEREAS, On August 21, 2017, the City Council adopted Ordinance No. ____ relating to development fees and connection and availability charges due on development; and WHEREAS, Minnesota Statutes requires publication of an Ordinance in the official newspaper before it becomes effective; and WHEREAS, Minnesota Statutes also allows the publication of a summary of an ordinance if the Council finds that the summary is an accurate representation of the Ordinance; and WHEREAS, The City Council desires to publish a summary of the amendments to Subsection 106.600 and Subsection 704.200 of the Prior Lake City Code and has determined the publication of a summary of this ordinance will meet the intent of the statute. 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. Ordinance No. _____________ is lengthy. 3. The text of summary of Ordinance No. __________________, attached hereto as Exhibit A, conforms to M.S. § 331A.01, Subd. 10, and is approved, and publication of the title and summary of the Ordinance will clearly inform the public of the intent and effect of the Ordinance. 4. The title and summary shall be published once in the Prior Lake American in a body type no smaller than brevier or eight-point type. 5. A complete text of the newly amended City Code will be available for inspection at City Hall or in the Document Center on the City of Prior Lake Website after August 21, 2017. PASSED AND ADOPTED THIS 21st DAY OF AUGUST 2017. VOTE Briggs McGuire Thompson Braid Burkart Aye ☐ ☐ ☐ ☐ ☐ Nay ☐ ☐ ☐ ☐ ☐ Absent ☐ ☐ ☐ ☐ ☐ Abstain ☐ ☐ ☐ ☐ ☐ _____________________________ Frank Boyles, City Manager 2 Exhibit A CITY OF PRIOR LAKE ORDINANCE NO. _________ AN ORDINANCE AMENDING CITY CODE SUBSECTION 106.600 RELATING TO DEVELOPMENT FEES, AMENDING CITY CODE SUBSECTION 704.200 RELATING TO CONNECTION AND AVAILABILITY CHARGES DUE ON DEVELOPMENT AND ADOPTING BY REFERENCE CITY CODE PART 1 WHICH, AMONG OTHER THINGS, CONTAINS PENALTY PROVISIONS The following is only a summary of Ordinance No. ____________. The full text will be available for public inspection after August 21, 2017 by any person during regular office hours at City Hall or in the Document Center on the City of Prior Lake Website. SUMMARY: The Ordinance amends Subsection 106.600 of the Prior Lake City Code by identifying Utility Development Fees within the Development Fee category on the City of Prior Lake Official Fee Schedule. The Ordinance amends Subsection 704.200 of the Prior Lake City Code related to sanitary sewer, water and storm water connection and availability charges due on development of property. This ordinance shall become effective from and after its passage and publication. Passed by the City Council of the City of Prior Lake this 21st day of August 2017. ATTEST: _________________________ __________________________ Frank Boyles, City Manager Kirt Briggs, Mayor Summary published in the Prior Lake American on the 26th day of August 2017. Public Ways & Property City of Prior Lake 704/p1 SECTION 704 UTILITY RATES, CHARGES AND FEES SUBSECTIONS: 704.100 PURPOSE 704.200 CONNECTION AND AVAILABILITY CHARGES DUE ON DEVELOPMENT 704.300 CONNECTION AND AVAILABILITY CHARGES DUE WITH PERMIT OR WORK 704.400 WATER AND SANITARY SEWER CHARGES AND RATES 704.500 STORM SEWER CHARGES AND RATES 704.600 OTHER CHARGES 704.700 ACCOUNTS RESPONSIBILITY OF OWNER 704.800 BILLS FOR SERVICE 704.900 CERTIFICATION 704.1000 PENALTY 704.100 PURPOSE 704.101 The rates, charges and fees established by this Part are for the purpose of paying: 1) The operation, construction, reconstruction, maintenance, repair, enlargement, improvement, use and administrative expenses of the City water, storm sewer and sanitary sewer facilities, and 2) The City’s share, as allocated by the Metropolitan Council, for the operation and maintenance costs of the metropolitan disposal system and as defined in M.S. 473.121, Subd. 24. 704.102 Use and Availability Charges. The City Council may, as authorized by statute, impose just and equitable charges for the use and for the availability of the City facilities and for connection with them. Fee justification studies shall be prepared to support changes in use and availability fee, except where the fees are established by Metropolitan Council. 704.103 Annual Fee Schedule. Usage charges, connection charges, storm sewer, sanitary sewer and water availability charges, permit fees and penalty fees, except those imposed by special assessments, shall be set forth in the City’s fee schedule, adopted annually by the City Council. 704.200 CONNECTION AND AVAILABILITY CHARGES DUE ON DEVELOPMENT The City may impose utility connection and availability charges due upon development. All such fees shall be set forth in the City fee schedule and shall be in addition to any connection and availability charges imposed by the Metropolitan Council. Certain City sanitary sewer, water and storm water connection and availability charges are due on development of property (“Utility Development Fees”). For purposes of this subsection the term development shall include but not be limited to the following: construction, installation, addition, modification, rehabilitation or alteration of a building or structure on the property; change in use of the property or a structure or building on the property; alteration, grading or excavation of the property; and subdivision or Public Ways & Property City of Prior Lake 704/p2 platting of the property. Utility Development Fees shall not be imposed if the fees were paid or assessed in conjunction with previous development of the property. Utility Development Fees shall not be imposed for property in a residential or agricultural district except upon platting or subdivision. All Utility Development Fees shall be set forth in the City fee schedule and shall be in addition to any connection and availability charges due with permit or work or those imposed by the Metropolitan Council. 704.300 CONNECTION AND AVAILABILITY CHARGES DUE WITH PERMIT OR WORK 704.301 City Connection Charges. All City sanitary sewer and water connection charges shall be paid before a permit to connect to the public sanitary sewer or water facilities will be issued, unless payment is deferred pursuant to the City’s deferral policy. The amount of the connection charge shall be determined by the number of units that will occupy the property as defined by the Metropolitan Council and based on the type of land use that will be conducted on the property multiplied by the unit charge set forth in the City fee schedule. Upon any change in use of the property the charges shall be recalculated and any additional charge resulting from the change in use or additional units shall be paid prior to the issuance of building or connection permits. 704.302 Metropolitan Council. In addition to the City charges, the sanitary sewer availability charge, as determined by Metropolitan Council, shall be paid prior to the issuance of any building or connection permits. 704.303 Water Storage Availability Charge. A water storage availability charge shall be determined by the City Council on an annual basis and set forth in the City fee schedule. Said fees shall be placed in a fund maintained by the City to accumulate funds for the construction of water storage facilities. 704.400 WATER AND SANITARY SEWER CHARGES AND RATES 704.401 Minimum Charges. Minimum charges for the availability of public water and/or sanitary sewer shall be imposed on properties where water and/or sanitary sewer facilities are available, regardless of the volume of water used or sewage discharged or whether the property is connected to the facilities. For purposes of this Section, the definition of available in Subsection 705.200 shall apply. For properties where water and/or sanitary sewer become available, the minimum charges will be imposed beginning on the date of connection or one year from the date such facilities become available, whichever occurs sooner. The minimum charges shall be set forth in the City fee schedule and shall be imposed per billing period per account. 704.402 Rates. Rates and charges for the collection and treatment of sewage and for the treatment and distribution of water shall be established by the Council and set forth in the City fee schedule. The rates may not exceed an amount reasonably calculated to cover the cost of the proper maintenance and operation of the facilities, including the cost of amortization of any indebtedness and a reserve for capital replacement. 704.403 Users Not Connected to Public Water. Rates and charges for the collection and Public Ways & Property City of Prior Lake 704/p3 treatment of sewage for those properties not connected to public water shall be set in the City fee schedule. 704.404 Sanitary Sewer Rate Cap. The charge for sanitary sewer usage for each billing cycle for bills issued in June, August, October and December (actual usage March 21 through November 20) shall not exceed one hundred and fifty percent (150%) of the average charge for sanitary sewer usage for the bills issued in February and April (actual usage November 21 through March 20). The purpose for this sanitary sewer cap is to provide consideration for lawn and garden sprinkling and other related outside water usage, which does not flow into the sanitary sewer system. 704.405 Metropolitan Council. In addition to the City charges, the sanitary sewer use rates, as determined by Metropolitan Council, shall be imposed per billing cycle. 704.406 Bulk Water Rate. Charges for bulk water shall be set forth in the City fee schedule. 704.500 STORM SEWER CHARGES AND RATES 704.501 Stormwater Management Fee Calculation. The Stormwater Management Fee is based on residential equivalency factors for various land uses. The residential equivalency factor is the ratio of runoff volume, in inches, for a particular land use, to the runoff volume, in inches, for an one-third acre residential lot, assuming a four and two-tenths inches (4.2”) 10-year frequency rainfall and USDA Hydrologic Soil Group B. The factors for various land uses are as follows: Classification Land Use RE Factor 1 Single-Family Residential 1.00 2 Multiple-dwelling units (residential) 1.65 3 Business / Commercial 2.07 4 Industrial 1.82 5 Institutional (schools, churches and govt. buildings) 1.38 704.502 Special Circumstances. (1) Agricultural and conservation zoned areas which have a residential or commercial building on the property will be considered a single family residential classification and be charged the single family residential parcel rate. (2) Property that has been platted or subdivided and has a structure on it will be charged the single family residential parcel rate. (3) Planned unit development zoning and government agency parcels other than the City will be charged at the rate deemed most appropriate for each individual parcel. 704.503 The Stormwater Management Fee shall be determined by the following steps: (1) The stormwater rate will be periodically determined and set by the City Council. (2) The Stormwater Management Fee for all single family residential parcels shall be the product of stormwater rate, the RE factor, and one-third of an acre. (3) The Stormwater Management Fee for all individual parcels other than single family residential parcels shall be defined as the product of the stormwater rate, the RE, and the total acreage of the parcel. Public Ways & Property City of Prior Lake 704/p4 (4) A minimum of one-third acre shall be computed for commercial site locations within agricultural and conservation land areas. 704.504 Credits. The City Council, in its discretion, may adopt policies for adjustment of the storm water management fee. Information to justify a fee adjustment must be supplied by the property owner. 704.505 Exemptions. The following land uses are exempt from the storm water management fee: • Public right of way. • Lakes. • Wetland (with easements dedicated to the City). • Municipal owned property. • Open space (cemeteries, golf courses). • Property which has been platted or subdivided but does not have a structure on it. • Property which has not been platted or subdivided and which does not have a structure on it, such as agricultural and conservation zoned land. 704.600 OTHER CHARGES 704.601 Capital Facility Charge. A capital facility charge may be imposed for the purpose of paying for the operation, construction, reconstruction, maintenance, repair, enlargement, improvement, use and administrative expenses of the City’s capital facilities. 704.602 Industrial User Extra Strength Charges. Each user receiving waste treatment services within or served by the City for industrial strength waste shall be charged an industrial strength charge in order to pay the charges allocated to the City by the Metropolitan Council. The strength charge shall either be billed directly by the Metropolitan Council to the user, or shall be billed by the Metropolitan Council to the City and by the City to the user. 704.603 Water Meter Charges. Prior to issuance of a water meter for initial installation or for replacement or repair due to damage caused by the owner, occupant or tenant, a water meter charge, and if appropriate a pressure reducer charge, shall be imposed in the amount set forth in the City fee schedule. 704.604 Meter Testing. Charges for testing of water meters shall be set forth in the City fee schedule. 704.605 Water Shut Off and Door Hanger. Charges for shutting off or restoring water services and for door hangers shall be set forth in the City fee schedule. 704.606 Metropolitan Council. In addition to the City charges, fee and charges as determined by Metropolitan Council shall be imposed. 704.700 ACCOUNTS RESPONSIBILITY OF OWNER Public Ways & Property City of Prior Lake 704/p5 All charges, rates, fines and penalties relating to City utilities are the responsibility of the property owner regardless of whether the property is subject to a lease or occupied by a person other than the owner. 704.800 BILLS FOR SERVICE 704.801 Billing and Delinquency: Utilities, including water, sanitary sewer, storm water, and any other utility services billable by the City shall be billed in the form and at intervals determined by the City. All charges shall be delinquent if they are unpaid by the bill due date. Each bill not paid by the due date shall be charged a late payment penalty of 1.5% per month until paid or until certified to taxes. Utility charges are a lien against the property, and the property owner remains responsible, at all times, for the payment of the charges in a timely manner. 704.802 Faulty Meters: If a meter fails to register or accurately measure the water usage, the water and sanitary sewer charges shall be paid for at the established rate based upon past average billings as determined by the City. 704.900 CERTIFICATION All charges and payments provided for herein are the primary responsibility of the owner of the premises served and all such charges and payments shall be a lien upon the property. Delinquent charges, including late payment penalties, shall be certified to the County Auditor to be paid with property taxes. The Finance Director shall determine the certification amounts for each property, including the applicable interest rate as set forth in the Special Assessment Policy, and the delinquent assessment administrative charge set by the City fee schedule. The owner of the property shall be given written notice stating the amount due, the date by which payment shall be made to avoid certification, the time, date, and location of the hearing where the City Council will consider certification, and the interest rate on the certification. The amounts shall be certified to the County Auditor for collection, in accordance with M.S. § 444.075, as it may be amended from time to time, along with property taxes. 704.1000 PENALTY 704.1001 Civil penalties for violations of Sections 704, 705 and 706 shall be set forth in the City fee schedule. Any violation of Sections 704, 705, or 706 which does not have a fee associated with it shall be charged to the violator at the cost incurred by the City in relation to the violation. 704.1002 In addition to the fees set forth in subsection 705.1001, any person violating any provision of this Section shall, upon conviction thereof, be guilty of a misdemeanor and be punishable in accordance with the penalties established by Minnesota Statute Section 609.02 as may be amended. A separate offense shall be deemed committed for each day the violation shall continue. Any person violating any of the provisions of this Section shall become liable to the City for any expense, loss or damage incurred by the City by reason of such violation. . Public Ways & Property City of Prior Lake 704/p6 Ord. Amd. 114-17, publ. 06/13/15 This space intentionally left blank.