Agenda - Council - 08/13/2013 - Laserfiche WebLink

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Ramsey, Nowthen, St. Francis, Oak Grove, and Bethel, Minnesota Feasibility Study for Shared or Cooperative Fire and Emergency Services Taxable Capacity Concept: The tax capacity of municipalities is established by the local tax assessor under laws of the state. Usually, higher -valued structures and complexes carry a greater risk to the community from loss by fire; consequently, assessed value also tends to approximate the property at risk within a municipality. Fire departments are charged with being sufficiently prepared to prevent property loss by fire. Therefore, the cost of contracted fire protection may be apportioned relative to the assessed value of the allied jurisdictions. Typically, tax capacity is used to apportion cost of shared service by applying the percentage of each partner's tax capacity to the whole. Calculation of applying tax capacity to the study are results in the following: The City of Ramsey would pay about 54.3 percent, the City of Nowthen would pay 7.8 percent, the City of St. Francis would pay 20.3 percent, the City of Oak Grove, 15.9 percent and the city of Bethel, 0.8 percent. Pro: Tax capacity is updated regularly helping to assure that adjustments for changes relative to new construction, annexation, and inflation are included. Because a third party (the assessor) establishes tax capacity in accordance with state law, it is generally viewed as an impartial and fair measurement for cost apportionment. Fire protection is typically considered a property -related service and, thus, apportionment tied directly to property value has merit. Con: Tax capacity may not reflect the risk associated with certain exempt property, such as schools, hospitals, universities, government facilities, churches, and other institutions. Tax capacity may also not always represent the life risk of certain properties, such as nursing homes or places of assembly, which might dictate more significant use of resources. In addition, some large facilities may seek economic development incentives through tax capacity exemptions or reductions. Adjustments may need to be made to tax capacity if such large tracts of exempt property in one jurisdiction cause an imbalance in the calculation. Finally, tax capacity typically includes the value of land, which is not usually at risk of loss by fire. Depending on the local circumstance, however, this may not be a significant factor if the relative proportion of land value to structure value is reasonably uniform over the whole of the territory. page 88 *.:1Ertisrgesicy Se es Co nsuh mg