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Home My WebLink About5E 2019 Sept Unpaid Special Assessments Agenda Report 4646 Dakota Street SE Prior Lake, MN 55372 CITY COUNCIL AGENDA REPORT MEETING DATE: SEPTEMBER 16, 2019 AGENDA #: 5E PREPARED BY: JASON ETTER, ACCOUNTING MANAGER PRESENTER: CATHY ERICKSON, FINANCE DIRECTOR AGENDA ITEM: ADOPT RESOLUTION NO. 19-103 DECLARING COSTS TO BE ASSESSED AND ORDERING PREPARATION OF AN ASSESSMENT ROLL FOR 2019 UNPAID SPECIAL CHARGES, AND ESTABLISHING THE DATE OF THE ASSESSMENT HEARING GOAL AREA AND OBJECTIVE: High-Value City Services 2. Design a comprehensive funding strategy for capital needs. DISCUSSION: Introduction The purpose of this agenda item is for the City Council to order preparation of an assessment roll and to set an assessment hearing date for 2019 Unpaid Special Charges. These charges include costs and charges incurred by the City for Oak Wilt, and mowing of nuisance properties and false alarms, and unpaid utility bills. The assessment roll that will be prepared for the public hearing will include the unpaid special charges by PID number and resident. History State Statute 444.075 states that a city may certify unpaid utility charges to the County Auditor with taxes against the property. 1) S now and weed elimination from streets or private property 2) Nuisance charges 3) Oak Wilt removal 4) The recovery of any disbursements for payment of utility bills and other services, even if provided by a third party Current Circumstances In order to recover unpaid special charges, the City must follow State Statute 429.101 procedures. Those procedures provide that the City must adopt a resolution declaring the unpaid special charges to be assessed and establish a date for the assessment hearing for those charges. Delinquent Utility Charges and Nuisance Abatement: The assessment shall include the annual principal, a delinquent assessment administration charge of $80 plus interest calculated from the date of the adoption of the assessment resolution to the end of 2019 plus twelve (12) months of the next year and shall bear interest at the rate of 4.04% per annum. 2 In the case of the special charges being considered as part of this resolution property owners have been provided the opportunity to pay the charges prior to the assessment. Conclusion The City Council should order preparation of the assessment roll and declare the costs to be assessed and establish the date of the assessment hearing in accordance with State Statute 429. ISSUES: In order for the City to recover unpaid special charges incurred in 2019 it is necessary for the City Council to proceed with this process. FINANCIAL IMPACT: The total unpaid special charges proposed to be assessed are: Delinquent Utility Charges $111,017.77 This is the principal portion of the assessment, in total, for delinquent charges. It does not include the administration charge or interest. The principal portion of the assessment in the three prior years is as follows: • 2016: $99,165.99 (included $22,126.74 for Oak Wilt and Water and Sewer Connection) • 2017: $93,475.18 (included $1,600.00 for Oak Wilt) • 2018: $113,002.65 (included $2,400.00 for Oak Wilt) On November 12, 2013, the Council directed staff to certify over-due utility billing to assessments (rather than shutting off water services due to non-payment) and continue to bill renters directly. As a result, the amount being certified has increased significantly. Online payment options have been available to utility customers since early 2014. Approximately 67% of residents pay their utility bill electronically (via PSN, ACH, etc.) ALTERNATIVES: The alternatives are as follows: 1. Motion and second as part of the consent agenda to approve the resolution declaring the costs to be assessed, ordering the preparation of the proposed assessment rolls for the 2019 Unpaid Special Charges, and establishing October 21, 2019 for the assessment hearing date as submitted. 2. Motion and second to remove the costs to be assessed, ordering the preparation of the proposed assessment rolls for the 2019 Unpaid Special Charges, and establishing the date of the assessment hearing from the consent agenda for additional discussion. RECOMMENDED MOTION: Alternative #1 RESOLUTION 19- 103 A RESOLUTION DECLARING COSTS TO BE ASSESSED AND ORDERING PREPARATION OF PROPOSED ASSESSMENT ROLL FOR THE 2019 UNPAID SPECIAL CHARGES AND ESTABLISHING THE DATE OF THE ASSESSMENT HEARING AND PUBLICATION THEREOF Motion By: Second By: WHEREAS, The City has incurred the following unpaid special charges in 2019: Special Charge Unpaid Amount Delinquent Utility Charges $ 111,017.77 ; and WHEREAS, Minnesota Statutes and Prior Lake City Code authorize the City to recover such charges through the special assessment process; and WHEREAS, For delinquent utility charges and nuisance abatement, property owners were previously sent notifications of amounts due and failed to pay; and WHEREAS, The City Manager notifies the City Council that such proposed assessments 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 services to be assessed against benefited property owners is declared to be $111,017.77. 3. Assessments for Snow Removal, Nuisance Charges, Mowing and False Alarms shall be payable pursuant to Minnesota Statute 429.101 and Sections 701.300, 605.900, 609.704 and 806.301 of the City Code in one (1) single installment payable in 2020. The single installment shall include the annual principal, a delinquent assessment administration charge of $80 ($105 for Spring Lake Township) plus interest calculated from the date of the adoption of the assessment resolution to the end of 2019 plus twelve (12) months of the next year and shall bear interest at the rate of 4.04% per annum. Delinquent Utility Charges shall be payable pursuant to Minnesota Statute 429.101 and Section 704.900 of the City Code in one (1) single installment payable in 2020. The single installment shall include the annual principal, a delinquent assessment administration charge of $80 ($105 for Spring Lake Township) plus interest calculated from the date of the adoption of the assessment resolution to the end of 2019 plus twelve (12) months of the next year and shall bear interest at the rate of 4.04% per annum. 4. Delinquent Utility Charges shall be payable pursuant to Minnesota Statute 444.075 and Section 704.900 of the City Code in one (1) single installment payable in 2020. The single installment shall include the annual principal, a delinquent assessment administration charge of $80 ($105 for Spring Lake Township) plus interest calculated from the date of the adoption of the assessment resolution to the end of 2019 plus twelve (12) months of the next year and shall bear interest at the rate of 4.04% per annum. 4646 Dakota Street SE Prior Lake, MN 55372 5. Oak Wilt Assessments shall be payable pursuant to Minnesota Statute 429.101 and Section 602.405 of the City code which provides that all assessments less than $1,000 shall be payable in one (1) single installment payable in 2020 and all assessments over $1,000 be paid on an equal principal installment method extending over a period of five (5) years for the assessment. The first installment shall be the annual principal plus interest calculated from the date of the adoption of the assessment resolution to the end of 2019 plus twelve (12) months of the next year and shall bear interest at a rate of 4.04% per annum. 6. The City Manager shall submit a list of the costs for services the City has incurred for unpaid utility bills, weed abatement, landscaping, nuisance charges, false alarms and oak wilt abatement, as provided by law, and shall file a copy of such proposed assessment in the office of the City Manager for public inspection. 7. The City Manager shall upon the completion of such proposed assessment notify the City Council thereof. 8. A public hearing shall be held on the 21st day of October 2019, 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. 9. 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 described in the assessment roll not less than two weeks prior to the hearing. 10. 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 to the City Finance Director the entire amount of the assessment remaining unpaid, with interest accrued to December 31 of the year in which such payment is made. Such payment must be made before November 30 or interest will be charged through December 31 of the next succeeding year. PASSED AND ADOPTED THIS 16TH DAY OF SEPTEMBER, 2019. VOTE Briggs Thompson Burkart Braid Erickson Aye ☐ ☐ ☐ ☐ ☐ Nay ☐ ☐ ☐ ☐ ☐ Abstain ☐ ☐ ☐ ☐ ☐ Absent ☐ ☐ ☐ ☐ ☐ ______________________________ Lori Olson, Interim City Manager