HomeMy WebLinkAbout8A Municipal Street Improvment Districts ReportPhone 952.447.9800 / Fax 952.447.4245 / www.cityofpriorlake.com
4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL AGENDA REPORT
MEETING DATE:
AGENDA #:
PREPARED BY:
PRESENTED BY:
AGENDA ITEM:
GOAL AREA AND
OBJECTIVE:
DISCUSSION:
MARCH 18, 2019
8A
MICHAEL PLANTE, CITY MANAGER
MICHAEL PLANTE
REPORT SUPPORTING LEGISLATION AUTHORIZING STREET IMPACT FEES
High-Value City Services
6. Seek community engagement through a variety of communication methods to
reach all residents.
Introduction
On February 19, 2019 the city council passed a resolution urging the state
legislature to adopt a statute which will provide legal authority for local government
entities to charge street impact fees. Since then the City has received support from
Scott County, City of Savage, City of New Prague, City of Belle Plaine, City of
Jordan, City of Elko New Market, City of Shakopee and Credit River Township.
The City has also received notice that Representatives Tabke, Albright, and
Senator Pratt would author bills that would seek to provide that legal authority.
This item is an update as to where the legislative process stands.
History
For years cities have recovered the costs for infrastructure through impact fees.
The state legislature has passed laws allowing for cities to charge for sanitary
sewer, storm sewer, water and parks fees and the expectation was that the same
was true for street fees.
But recently the supreme court ruled in Harstad v City of Woodbury that local
government entities do not have the authority under existing statute to charge
street impact fees.
To some cities like Prior Lake this ruling has meant a great deal since the ultimate
transportation system for the community is not yet constructed. In the case of Prior
Lake, it is estimated that the city will experience as much as a $26 million shortfall
if the street impact fee continues to be prohibited.
Under the city’s current ordinances, developers pay for the infrastructure required
to serve the needs of their subdivisions. Sewer, water, storm water and even
neighborhood roadways are installed to the city’s specifications by the developer
who recovers his costs through selling the land and building homes.
What these fees do not reimburse is the indirect roadway costs caused collectively
by community development. That is what the street impact fee is intended to do.
Current Circumstances
The city council desires that development pay for itself to the extent possible.
Without the street impact fee, there is a “hole” in the city’s ability to pay for the
major elements of the transportation system. The intersection at Revere and
County Road 21 is an example of a transportation intersection improvement which
would be funded in part by the street impact fee.
To address the supreme court’s action the city is taking several steps. The city has
contracted with a consulting firm to more specifically identify the costs which must
be recovered to make the city whole. The report from that study is expected late in
April. Once received the city council will consider its options for reinitiating the
street impact fee.
The city also partnered with other similarly situated cities, the County, and others
to continue to push for legislative authority. Specifically, the City has received
Scott County, City of Savage, City of New Prague, City of Belle Plaine, City of
Jordan, City of Elko New Market, City of Shakopee and Credit River Township.
FINANCIAL
IMPACT:
Without the street impact fee or something similar Prior Lake may be unable to
build the transportation system essential to serve our community at build out. This
could mean that the city must consider some other form of fee or some action to
slow or halt development—neither of which is a desirable alternative.
ALTERNATIVES: 1.Motion and second as part of the consent agenda to adopt the report supporting
legislation which would authorize street improvement fees.
2. Motion and second to remove this item from the consent agenda for additional
discussion.
RECOMMENDED
MOTION:
Alternative #1