4.b) Staff Report-Draft Assessment Policy 7 `l
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SCANDIA.
Staff Report
Date of Meeting: August 13, 2013
To: City Council
From: Kristina Handt, Administrator
Re: DRAFT Assessment Policy
Agenda Item #: 4.b)
Background:
Included in your packet is a copy of the assessment policy previously used by New Scandia
Township.
In 2009, the Capital Improvement Committee reviewed a draft proposal (copy included in your
packet) but declined to make any recommendation on it to the Council feeling that Council
should be the body to make the decision on this policy matter. No action was taken by the
Council to adopt an assessment policy, instead road projects such as Quinell and Pilar were
delayed until residents requested them and that good roads would be maintained by crack filling
and seal coating.
Last year during the discussion of the improvements to Melanie Trail, the need for an assessment
policy was noted and may also need to apply to reconstructions as well as new roads or turning
gravel roads to paved roads.
In order to help with the financial planning for various road projects discussed previously and
others that may come up in the future, staff is seeking direction from the Council on whether or
not road costs will be assessed and other components of a possible policy. The City Attorney has
recommended that if the City is going to be assessing for roads, it should have an adopted,
written policy.
Issue:
Should the City adopt an assessment policy? If so, what should be included?
Proposal Details:
Included in your packet are the draft from 2009 reviewed by the Capital Improvement
Committee at the time and a draft assessment policy Ehlers and Associates prepared for the
League of Minnesota Cities. City Engineer Goodman has also provided examples of policies
from Blaine, St. Francis and Annandale. He has also supplied a chart comparing assessment
policies across a number of communities.
Before discussing the specifics of any assessment policy, the Council should discuss if assessing
for improvements is something they'd like to pursue or if levying a general tax levy is more
appropriate.
Items for discussion:
➢ Is the past practice of 25% assessment for collector roads and 75% assessment for non-
collector roads still appropriate?
➢ Should the policy include provisions for assessing on reconstruction projects? If so, at
what percentage?
➢ What method of assessment should be used?-Adjusted Front Footage, Area Method, Per
Lot/Unit Method?
➢ How are corner lots counted?
Fiscal Impact:
Assessing a portion or all of the cost of road construction or reconstruction to the adjoining
property owners would lower the cost paid by other City taxpayers for a project. Additionally,
by assessing for at least 20% of a project the City is able to borrow for the remaining funds
without requiring an election. The ability to borrow for funds is increasingly more important in
times of levy limits and tight budgets.
However, if funds are levied as part of the general fund or Capital Improvement Fund, then all
taxpayers in the city contribute to the cost. By spreading the cost among more taxpayers, the
costs on an individual basis are lowered. It may be difficult to levy enough funds to complete the
needed road projects if levy limits remain and/or the Council seeks no increase in the levy.
The Council may also want to look to other forms of financing road work such as franchise fees
(next agenda item)before making a final decision.
The direct fiscal impact would be measured and known for each specific project at the time the
Council is considering it.
Options:
Any direction provided to staff would be helpful in preparing the next draft of the policy likely to
be brought back to another work session for further review by the Council.
NEW SCANDIA TOWNSHIP BITUMINOUS SURFACING POLICY
FOR EXISTING GRAVEL ROADS
FEBRUARY 19,2002
1. GOALS
A. All Coltector Roads and nearly all Non Collector Roads shall be Bituminous Surfaced.
{1) Cheaper to maintain
(2) Better road surface
(3) Safer
B. No more than two(2)Bituminous Bonds at any one time.
C. Minimum of two(2)miles/year or ten(10)miies/5 years.
II. BITUMINOUS STANDARDS
A. All bituminous surfaced roads within the Township shall be constructed to a
minimum of six inches(6) inches of Class 5 gravel and three(3)inches bituminous
surfacing. The bituminous surfacing shall be installed in two lif3s of one and one half
inches each according to a schedule approved by the Township Engineer. A more
stringent road design may be required for Collector roads upon recommendation of
the Township Engineer.
B. In all cases,Collector Roads should be 24 feet wide.
C. Non Collector Roads shall be minimum of 20 feet wide. The Town Board may allow
a variance under special conditions.
D. Township Standards Road Section is 24 feet with 2 feet gravel shoulders on each side,
but in some cases it may be necessary to reduce these.
E. In some cases it may be necessary for the Town Board to review further on an
individual bssis where special conditions exist.
III. Assessments
A. Formul$s
(1) Total Bituminous Surfacing Cost divided by total assessable units=cosdunit
(2) Cost/Unit x 0.25=Collector Road Assessment
(3) Cost/Unit x 0.75=Non Collector Assessment
B. Definitions
(1) Assessable unit is an e�sting home site or buildable site.
(2) Collector Road and Non Collector Road shall be defined by New Scandia Road
Classificarion Map '
(3) Special Situations-township could pay !00% if the township benefits from the
project
(4) Corner Lot Assessment is '/z assessment on side without main driveway
Plus one(1) assessment on side with main driveway.
(5) No assessment on resurfacing or maintenance
IV. EACTORS TO CONSIDER WHEN A ROAD MAY BE SURFACED
A. Road has been properly petitioned prior to township consideration for bituminous
Surfacing. Petition must have 35%of the abutting properry owners.
B. Road has been built to township specifications.
C. Road committee recommends improvements.
D. Where a Collector Road is surfaced all Non Collector Roads entering on to that
Collector Road should be surfaced.
E. Ease of road maintenance. Bituminous surfaced road should not be lefl between
gravel surfaced roads.
F. The Town Board must attempt to keep good ratio of Collector Roads and Non
Collector Roads in each Bituminous Surfacing Project.
(1) Keep assessments as even and fair as possible on all Bituminous Surfacing.
(2) This complies with the Comprehensive Plan.
City of Scandia, Minnesota
Assessment Policy for Public Streets
Draft,June 2009
Purpose
The purpose of this Street Assessment Policy is to establish a fair and equitable manner of
recovering and distributing the cost of public improvements. The procedures used by the City of
Scandia for levying special street assessments are those specified by Minnesota Statutes
§Chapter 429, which provides that "all or a part of the cost of improvements may be assessed
against benefiting properties."
Initiation of Public Street Improvements �Y
A public street improvement can be initiated in the following manner:
1. Petition by property owners that own at least 35% of the frontage on the street to be
improved; or
2. Resolution by the City Council ordering the public improvement when, in the Council's
judgment, the improvement is needed, and action is required. The criteria which the City
Council may use as a basis to determine the public need for the improvement include
traffic volume, maintenance costs, and the general public safety.
Definitions
Unit Method—The Unit Method of assessment is defined as the quotients of the identified
assessable costs divided by the number of lots, parcels, or properties benefiting from the
improvement. When parcels that can be further subdivided are found to benefit from the
proposed improvement, the number of lots attributed to that parcel will be determined from the
number of potential lots that could be obtained from subdivision, using current subdivision
regulations. Corner lots subject to an assessable street improvement will be assessed 100% of the
unit assessment when the property address fronts the assessable improvement. Corner lots
assessed under the "unit" method assessment shall be responsible for 150% of the costs when the
improvements abut the property on more than one street.
Front Foot Method —The front foot method of assessment is defined as the quotients of the
identified assessable costs divided by the total assessable frontage benefiting from the
improvement. Adjustments shall be made for odd-shaped lots to an average front footage that
would be the equivalent to the frontage of a rectangular shaped lot of the same area and depth.
The purpose of this adjusted front footage is to equalize assessment calculations for lots of
similar size. Corner lots assessed under the "front foot" method shall be responsible for the costs
identified for the improvement for the full frontage of the property that fronts the improvement.
Assessable Street Improvement Costs—The assessable costs of a street improvement project
includes the cost of all necessary construction work required to accomplish the improvement,
acquisition of right-of-way and easements, engineering, legal, administrative, financing,
appraisals, and other identifiable costs. The street improvement project includes bituminous
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surfacing, aggregate base, sub-grade correction, drainage improvements such as curb and gutter,
ditches, swales, storm sewer, and storm water management retention or treatment as required for
the improvement.
Collector Road—A road designated as a major or minor collector by the Comprehensive Plan
(as depicted on Map 25, Roadway Functional Classification, 2008 Comprehensive Plan.)
Assessment Method
The assessment rate shall normally be by the "unit" method in residential or agricultural areas.
The "front foot"method of assessment may be used for streets serving commercial or industrial
development, as determined by the City Council. Corner lot properties shall be included in the
assessment roll when the property mailing address fronts the improvement.
Design Standards
Construction and reconstruction of public improvements shall be consistent with the Engineering
Standards approved by the City Council. The life expectancy, or service life, for street
improvements, including concrete curb and gutter, sidewalk,trails, and storm sewer, is 20 years,
unless otherwise stated in the resolution ordering the public improvement.
If a public improvement project needs premature replacement or reconstruction, the amount to be
assessed to the benefiting properties will be limited to an amount determined by dividing the
actual service period of the original improvement by the expected service life of the original
improvement.
Initial Bituminous Pavement Improvements for Gravel Streets
Initial bituminous construction for existing gravel streets in rural zoning districts consists of the
shaping of the existing aggregate surface, supplementing the existing aggregate base to specified
thickness, constructing the bituminous base course to the specified thickness and width,
construction of the bituminous wear course to the specified thickness and width. Sub-grade and
drainage improvements will be constructed as determined necessary by the City Engineer. The
constructed width and material thickness is to be in accordance with the Typical Rural Street
Section detailed in the Engineering Standards adopted by the City Council, unless otherwise
determined by the City Council.
Initial bituminous pavement improvements for existing gravel streets shall be assessed based on
the following formula:
1. Total bituminous cost(both base course and wear course) divided by the number
of assessable units= cost/unit
2. Cost/unit x 0.25 = collector road assessment per unit
3. Cost/unit x 0.75 =non-collector road assessment per unit
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The City Council may make an exception to this policy in the case where the city is determined
to benefit from the improvement or where special conditions exist. In no case will less than 20
percent of total project costs be assessed to benefiting properties.
Reconstruction or Overlav of Existing Residential Bituminous Surfaced Streets
Reconstruction of existing bituminous surfaced streets shall be assessed at a rate of % of
the costs of the improvements to the benefitting properties, with frontage on the street proposed
for the improvement, and adjustments for corner properties. The City of Scandia will participate
in the remaining % of the improvement costs.
Reconstruction of existing bituminous surfaced streets that are designated as Collector streets
shall be assessed at a rate of 100% of the costs of a typical Rural Street Section and defined in
the Engineering Standards as adopted by City Council. The City of Scandia will participate in
the improvement costs that exceed the Standard Residential Street Section including additional
design street section thickness, additional storm drainage capacity, and additional width required
to meet the needs of the projected 20-year traffic volume projections. These City costs are
generally referred to as "street over-sizing" costs.
The City of Scandia may vary from this policy in the case of a street that has been transferred to
its jurisdiction from the County or State, typically referred to as "turn-back," depending upon the
condition of the street at the time of turn-back and considering any payments received by the city
from the other jurisdiction.
Construction of New Streets k��,���
Construction of all new streets will be assessed at a rate of 100% of the cost of the
improvements,to the benefiting properties. The new streets will be designed in accordance with
the city's Engineering Standards and applicable provisions of the city's Subdivision Regulations,
as adopted by the City Council.
The assessed cost of the improvements to the benefiting properties with frontage on the proposed
street improvement will be limited to the construction costs of a typical City residential rural
street section. The City of Scandia will participate in the any street over-sizing costs for
improvements to designated Collector streets.
Non-Assessable Public Street Improvement and Maintenance Costs
The City of Scandia will not assess the following:
• Maintenance of bituminous surfaced streets including bituminous patching, crack filling, seal
coating, shoulder maintenance, mowing and snow plowing
• Maintenance of existing public gravel streets including periodic grading, periodic gravel
placement, mowing, dust control and snow plowing.
Maintenance frequency is determined by the City Council and staff, and described in city
policies (such as for snow plowing, dust control and others) as may be adopted by the Council.
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