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Home My WebLink About7A - Special Assessments 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 CITY COUNCIL AGENDA REPORT MEETING DATE: AGENDA #: PREPARED BY: October 17, 2005 7A Larry Poppler, Assistant City Engineer AGENDA ITEM: DISCUSSION: SPECIAL ASSESSMENT PUBLIC HEARING FOR 2005 IMPROVEMENT PROJECT #05-01 & #05-11 FISH POINT ROAD, FAIRLAWN SHORES TRAIL, BLUEDORN CIRCLE, CANDY COVE TRAIL, AND CENTENNIAL STREET IMPROVEMENTS AND CONSIDER APPROVAL OF A RESOLUTION ADOPTING THE ASSESSMENT ROLL FOR THE PROJECT. Introduction This agenda item is necessary to adopt the assessment roll for the 2005 Improvement project. History At its regular meeting of September 19, 2005, the Council approved Resolution 05-160, which declared the cost to be assessed, ordered the preparation of the assessment roll and established the date of the Assessment Hearing as October 17,2005 for the 2005 Improvement Project, Fish Point Road, Fairlawn Shores Trail, Bluedorn Circle, Candy Cove Trail and Centennial Street (Project #05-01 & #05-11 ). Current Circumstances All benefiting property owners have been mailed a Statement of Special Assessments, which included information pertinent to their property such as the total proposed assessment amount and the assessment rate. The Notice of the Special Assessment Hearing was published in the newspaper on September 24th and October 15\ 2005. Under state statute, the City may only assess a property up to the amount the property is specially benefited by the public improvement. Special benefit is defined as the difference between fair market value before and after the project. The Property owners who believe that the proposed assessment exceeds the special benefit have a right to appeal their assessments as per Minnesota Statutes Chapter 429. Written objections must be signed and filed with the City Manager prior to the Assessment Hearing or presented to the Council at the Hearing on October 17, 2005. Within 30 days of the hearing, the owner must also file the appeal in District Court. No appeals were received at the time this report was prepared. We have apprised each of the property owners of our Deferred Assessment Program. ISSUES: A number of issues have been discussed in previous meetings and continue to be discussed by residents of the 2005 Improvement Project. These issues are not necessarily pertinent to the project special assessment hearing, however they are on the minds of some of the residents so we have provided responses to each. www.cityofpriorlake.com Ci\FROJ r:CTS2i '0."\ i I . Fish Point.. Fmda\lIl\(Ph3~I~Ji~{~~~4~7: 42'3~)t7al F~~S95~:4Sr'f4245 I.) .\I'ROJF:CIS200."\I Non - Assessment Hearina Issues 1. Drivewav Removals - This year the City of Prior Lake is utilizing new guidelines for residents who wish to have their entire driveways replaced. In the past, residents would hire their Contractor and be reimbursed for work that the City no longer had to perform. The past method was very complicated, resulted in direct reimbursements to residents, and took a lot of staff time to implement. The Assessment Review Committee reviewed the past driveway practices and decided upon new guidelines. The City offers replacement of the disturbed portion of the driveway or removal of up to 50 feet of driveway with any additional removal and reconstruction the resident's responsibility. These new guidelines were distributed at the second informational meeting and through a newsletter distributed on May 25th, 2005. Some residents on the Project who had driveways over 50 feet were confused by these new guidelines and didn't understand why the remaining part of their driveway was not removed, especially if the driveway was 53' or 58' long. The information in the newsletter clearly shows the 50 foot maximum. 2. 150th Sidewalk Items - Some residents on the reconstruction project have questioned the City's consistency with policies on the 150th street sidewalk. This is a sidewalk project and while it is being constructed concurrently by the same Contractor, it is not part of the reconstruction project. In order to construct the sidewalk within public right of way, staff was required to work out agreements with individual properties due to required grading and driveway reconstruction. This Project is different than the reconstruction project and requires additional flexibility with residents to complete the required improvements. For example, one resident paid for an upgrade from a bituminous driveway to a concrete driveway. 3. Project Floodina - During the course of the Project two large rain events occurred. These rain events challenged the erosion control on the Project since considerable ground cover has been removed for construction purposes. For the most part the erosion control features worked well. However, in two instances the erosion control devices held back too much water and ended up causing some flooding of the roadways and yards. The City did not receive any reports of flooded basements on the Project. The rain also impacted the schedule on the Project. Depending on what type of work is being done at the time the Contractor can be delayed as many as three days after large storm events. 4. Project Schedule - All Project utilities are complete. Fairlawn Shores, Candy Cove Trail, and Centennial Street will have sod on or soon after October 1 in. Bluedorn Circle and Fish Point Road will have class 5 surface finished during the week of October 1 ih. Part of Fish Point Road will be curbed by October 17th. The remaining curbing will be completed once all the class 5 aggregate has been installed. Paving of the remainder of the project will happen in the last week of October. Driveways and restoration will proceed into November. While beneficial to the neighborhood, the burial of the private utilities had a significant impact on the overall project schedule. Rain this construction season was also a factor especially rains in September and October. :\io?('nda 6:: Re;;ol\] 0 17(15 Special AsseSS!I\(:n15IJOC 5. Late Season Soddina - Much of the Project will receive sod in late October and early November. Some residents have expressed concern about placing sod this late in the season. The past two years the City has placed sod into mid November. This sod has flourished on these past projects. The sod goes dormant once placed and in the Spring jt utjlizes snowmelt and Sprjng rains to grow and establish root structure. This sod will be under warranty over the Winter and into Spring. Assessment Hearina Issues 1. Assessina Flint Road - At the public hearing a number of residents questioned why the Flint Road residents are not part of the assessable portion of this Project. This item was discussed at a number of City Council meetings. At the May 16th, 2005 City Council meeting, the Council agreed with the staff and the Assessment Review Committee that Flint Road is a private street and must be maintained by the residents who have an address on Flint Road. The City's appraisal consultant reviewed the proposed benefit received by Flint Road residents and determined that it would most likely not support the assessment. Additionally including Flint Road as assessable properties would not be consistent with City policy. 2. Calculation of Indirect Costs - Twenty-five percent of the street and storm sewer is attributed to the administration, financing, and engineering costs for the entire Project. Our indirect costs are calculated as follows: Engineering Financing Administration Construction Staking 17% 3% 3% 2% Forty percent of the 25% is then assessed to the residents on the Project. Some residents have asked if the indirect costs for the Franklin Trail, Duluth Street, and 150th Sidewalk are being assessed. The indirect costs for those projects are not assessed and funds from the ad valorem are used to pay those indirect costs. Some residents have questioned the amount of actual indirect costs. A review of staff time, finance and consultant costs justifies the use of 25%. The Engineering Department has polled the surrounding communities to query them on the percentage of indirect costs they charge. The City of Savage consistently used 32% of entire project, but in recent years they are using between 25% - 28% of the entire project for indirect costs. In the City of Shakopee, depending on project specifics, the amount of indirect cost has been between 20% and 25%. The City of Lakeville uses 25% for the calculation of indirect costs. It appears that the use of 25% is consistent with costs charged by communities. The Special Assessment Committee has recommended that the calculation of indirect costs continue as has been done in the past. The Special Assessment Committee agreed that the majority of the project is being funded by the general taxpayers and it has been a consistent practice to assess project properties in this manner. At the September 19th, 2005 City Council meeting this item was discussed and the City Council agreed with the Assessment Review Committee and ChI'I<UII:CIS";OO"d I FishPoint Fairlawn\CC' Agcnda 6:: Resol\1 0 1705 Special A,;ses';melltsJIOC authorized the preparation of the assessment roll with the inclusion of indirect costs as calculated. 3. Quantities - Because the Project is not yet complete at the time of the assessment, the City utilizes a construction estimate for calculation of the assessment. The actual quantities associated with the Project may end up above or below the estimate. Some residents have questioned the calculation of certain quantities. One of those quantities is curb and gutter replacement. This item is for curb and gutter which is damaged due to snow plowing. In recent years the amount of snow plow damage has not been as great as originally estimated. Our quantity for this item will be adjusted on future projects. Also the amount of 3" minus used on this year's project has been less than originally estimated, however the amount of 1 1/2" screened clean aggregate base has been greater than originally estimated. The 2004 project is almost complete and the actual costs are within 2% of the estimated costs for street and storm sewer. The 2003 project was within 3% of the estimated costs for the 150th Street Project but was 13% over for the Hope Street Project. On the Hope Street project very poor soils were encountered during construction which increased the project costs. If the City waited until final costs were available for assessments, the project costs would increase due to extended financing and potentially construction costs could increase resulting in higher assessments. Typically these overestimates and underestimates even themselves out The Special Assessment Review Committee recommends that the Unit Assessment method be used for the Project. The method is appropriate because the lots in the area are of similar size and/or value and all of the properties receive the same benefit. Of the total proiect costs. $2.462.425.16 or 70% will be paid throuQh sources other than special assessment. The proposed amount to be assessed against the benefiting properties is $1,051,560.00. The amount assessed is broken down into two separate assessments. The Centennial Street assessment is a first time or 100% assessment. The amount assessed to the Centennial Street residents is $162,839.50. There are 10 benefiting units on Centennial Street that are being assessed. Based on the foregoing the proposed assessment rate is $16,284.00. This compares to the original assessment estimate of $16,660.00 per unit. The remaining area includes Fish Point Road, Fairlawn Shores Trail, Bluedorn Circle and Candy Cove Trail. The amount of the assessment for this area is $888,720.00. There are 115 benefiting units in the project area that are being assessed at a 40% rate. Based on the foregoing, the proposed assessment is $7,728.00 per unit. This compares with the original assessment estimate of $8,094 per unit. The assessment term is ten (10) years for paving. Added to the first installment (2006) will be an additional 75 days of interest, which accounts for the remainder of 2005 following the Assessment Hearing. An interest rate of 6% will be charged in accordance with the City Assessment Policy. The SpeCial Assessment Review Committee believes that the special benefit ("PROJECTS-2IH)"\! I FishPoillt lairlawn\C( i\g('nda 6:: Rc,oI\1 0 1711.'\ Spccial :\,;scssmellf.'iDOC received by each of the affected properties exceeds the proposed assessment. The focus of tonight's hearing is whether the affected properties have received special benefit equivalent to the proposed assessment for each property, and whether the assessment has been calculated accurately and in accordance with City Assessment Policy. FINANCIAL IMPACT: The following is a summary of the financing of the improvements. Funding Source Project #05-01 & #05-11 Assessments* $1,051,560.00 Tax Levy* $1,339,541.15 Enterprise Fund Transfer $613,466.47 Capital Park Transfer $94,400.75 Streets BudQet $48,067.25 Sewer Budget $261,677.83 Water Quality BudQet $105,271.71 Project Total $3,513,985.16 * The numbers shown above include 25% indirect costs for engineering, administration, and financing. The total Project cost for Project #05-01 and #05-11 is $3,513,985.16. This cost is proposed to be funded through tax levy, enterprise fund, water quality fund, capital parks fund, streets operating budget, and special assessments. The Council should open the public hearing, receive public input and then close the public hearing. If certain issues need additional study, those issues could be referred to the Assessment Review Committee for evaluation and recommendation; otherwise, it would be appropriate to approve the attached resolution. Statutes require that special assessments be certified to the County by November 30th. Since property owners must be allowed 30 days to payoff their assessments interest free, the assessment roll must be adopted prior to November 1 , 2005. ALTERNATIVES: The alternatives are as follows: 1. Approve a resolution adopting the assessment roll as submitted. 2. Approve a resolution subject to Council approved changes. 3. Close the hearing and direct the Special Assessment Review Committee to examine issues or concerns raised at the hearing and provide a recommendation for Council action at a special meeting. RECOMMENDED A motion and second to adopt a Resolution Adopting Assessment Rolls for MOTION: Project 05-01 & 05-11 Fish Point Road, Fairlawn Shores Trail, Bluedorn Circle, Candy Cove Trail, and Centennial Street Improvements. G\I'RilJEC.IS2ilOS\II.... FishPointFairlawn\CC' ;\g('nda 6:: 1((:;;0I\]!i 1705 Spe(\iaI :\sscssnwlI(S DOC Reviewed by: ffk Steve Albrecht, Pu ic Works Director 1 it Manager (l.\FR()JLCIS2IH)S\1 Agenda 6:: Resol\1 n 17(15 Special :\sseS';!Ilellfs DOC 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 RESOLUTION 05-XX RESOLUTION ADOPTING ASSESSMENTS FOR PROJECT #05-01 AND #05-11 FOR FISH POINT ROAD, FAIRLAWN SHORES TRAIL, BLUEDORN CIRCLE, CANDY COVE TRAIL, AND CENTENNIAL STREET IMPROVEMENTS MOTION BY: SECOND BY: WHEREAS, pursuant to proper notice duly given as required by law, the Council has met and heard and passed upon all objections to the proposed assessments for Project 05- 01 and 05-11 Fish Point Road, Fairlawn Shores Trail, Bluedorn Circle, Candy Cove Trail, and Centennial Street Improvements. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA, THAT: 1. The recitals set forth above are incorporated herein. 2. Such proposed assessment, a copy of which is attached hereto and made part hereof, is hereby accepted and shall constitute the special assessment against the lands named therein, and each tract of land therein included is hereby found to be benefited by the proposed improvement in the amount of the assessment levied against it. 3. Such assessments shall be payable on an equal principal method extending over a period of ten (10) years for paving. 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 six (6) percent per annum from the date of adoption of this assessment resolution. To the first installment shall be added seventy-five (75) days of interest on the entire assessment from the date this resolution is adopted to December 31, 2005. To each subsequent installment when due shall be added interest for one year on all unpaid installments. 4. 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 the payment, except that no interest will be charged if the entire assessment is paid within thirty (30) days, and the individual may at any time thereafter, pay to the City's Finance Director the entire amount of the assessment remaining unpaid, excepting the installment portion appearing upon the current year's property tax statement. 5. The Finance Director shall forthwith transmit a certified duplicate of this assessment to the County Auditor to be extended on the property tax lists of Scott County. Such assessments shall be collected and paid to the City in same manner as other municipal taxes. 6. The final project cost apportionment has been determined to be $3,513,985.16 of which $1,339,541.15, $613,466.47, $94,400.75, $48,067.25, $261,677.83, and $105,271.71 shall be paid from Tax Levy, Enterprise Fund Transfer, Capital Park Fund Transfer, Streets Budget, Sewer Budget, and Water Quality Budget respectively, and $1,051,560.00 to be G:\PROJECTS\2005\11_FishPointJairlawn\CC Agenda & Resol\101705 special assessments resolution DOC www.cityofpriorlake.com Phone 952.447.4230 / Fax 952.447.4245 assessed to the benefited property owners at the assessment rate of $7,728 and $16,284.00 per unit as per the attached assessment roll. PASSED AND ADOPTED THIS 17TH DAY OF OCTOBER, 2005. YES NO Haugen Hauaen Flemina Fleming leMair leMair Petersen Petersen Zieska Zieska { Seal} Frank Boyles, City Manager G:\PROJECTS\2005\11JishPoint]airlawn\CC Agenda & Resol\101705 special assessments resolution. DOC ..J ..J ~ I- Z W :z In In W In In 0( ~ 0( Z :i ::i W 0:: Do .... 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