Agenda - Council Work Session - 10/14/2014

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CC Work Session 2. 3. Meeting Date: 10/14/2014 Information Title: Review Draft Special Assessments Policy for City Improvement Projects Purpose/Background: Purpose: The purpose of this case is to review the draft Special Assessments Policy for City Improvements, and to provide input to City Staff to allow adoption of the Policy in November of 2014. Background: On May 20th the Public Works Committee directed Staff to develop a draft Special Assessments Policy to establish how special assessments will be levied against properties benefiting from various types of City improvements, including street reconstruction projects. As discussed at the time, even if special assessments are not used to fund street improvement projects it would be advantageous for the City to have an adopted Special Assessments Policy. The Committee also directed staff to research other cities special assessments policies to see how they address specific situations and apply special considerations in assessing property owners for public improvements. On June 25th the Charter Commission voted to amend Section 8.4.5 of the City Charter, increasing the percentage of property owners required to petition against Council initiated public improvements utilizing special assessments as a funding source from greater than 50% to 60% or more. While this action will make it slightly more difficult for the public to petition against Council initiated improvement projects, it will still not prevent property owners from petitioning against Council initiated public improvements utilizing special assessments as a funding source. On August 14th the Public Works Committee reviewed the first draft of the Special Assessments Policy, which was developed using the model Special Assessments Policy prepared by Ehlers and Associates, Inc. as posted on the League of Minnesota Cities (LMC) web site. However, Chairperson Backous and Councilmember Kuzma were both absent so Staff was directed to bring the draft Policy back at a later date for review by the full Committee. However, the Committee members in attendance that evening provided several comments as follows. Any applicable MSA funds must first be applied to the City's share of the project costs, no conflicts can exist between the Policy and the City Charter, and the Policy should provide as much flexibility as possible in considering existing property sizes, shapes, development status (developed vs. undeveloped), etc. These comments were subsequently incorporated into the draft Policy. On September 16th the Public Works Committee again reviewed the draft Special Assessments Policy. After considerable discussion, Staff was directed to revise the draft Policy to incorporate the Committee's proposed assessment percentages, and to incorporate staff's proposed recommendations on the use of the various assessment methods, then to bring the draft Policy directly to a City Council Work Session for review and input from the full Council. Attached is the latest draft of the Special Assessments Policy. Text shown in red strike -through format is proposed for deletion, while blue underlined text is new language as proposed by the Public Works Committee and by City Staff. Staff is seeking Council input on the draft Policy including the proposed assessment percentages listed in Section 10, and on the special considerations listed in Section 6 including whether costs for subgrade excavation and rural to urban street conversions should be non -assessable costs paid solely by the City. Other special considerations may be desirable to reduce assessable costs as warranted, especially when considering that special assessments levied at