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City Council - 07/18/2000 - Workshop APPROVED MINUTES EDEN PRAIRIE, CITY COUNCIL WORKSHOP/FORUM TUESDAY,JULY 18,2000 5:00-6:55 PM, CITY CENTER HERITAGE ROOM III CITY COUNCIL: Mayor Jean Harris, Councilmembers Sherry Butcher,Ronald Case,Ross Thorfinnson,Jr., and Nancy Tyra-Lukens CITY COUNCIL STAFF: City Manager Chris Enger, Parks & Recreation Services Director Bob Lambert, Public Safety Director Jim Clark, Public Works Services Director Eugene Dietz, City Engineer Al Gray, Community Development and Financial Services Director Don Uram, Management Services Director Natalie Swaggert, and Recorder Lorene McWaters I. CALL MEETING TO ORDER—MAYOR JEAN HARRIS Mayor Harris called the meeting to order at 5:25 p.m. II. APPROVAL OF AGENDA III. SPECIAL ASSESSMENT POLICY Public Works Services Director Gene Dietz reviewed the City's Special Assessment Policy,which was adopted in 1989 and revised this year. Dietz also reviewed legal and policy issues,referring to the current Highview/Lakeland Terrace and Cedar Forest projects for examples. Dietz explained that Eden Prairie's special assessment policy requires each property owner to pay for the road and utility systems adjacent to his/her parcel of land as well as to share in the overall cost of the trunk utility system and collector/arterial street system. The past City Council had believed this to be the most equitable method of financing the City infrastructure. With the help of a professional private appraiser, a cap of$19,600 per lot for 2000 was reached. Dietz highlighted and explained several specific policy statements. • The final test for a special assessment is that the benefit equals or exceeds the amount of the assessment. If a property owner provides a written objection to the special assessment before or at the hearing,they have the option of filing an appeal within 30 days of the hearing. If COUNCIL WORKSHOP MINUTES July 18, 2000 Page 2 necessary, a trial at District Court will determine the matter. Dietz noted that he has seen the objection process result in a District Court trial only a handful of times. • Each petition from benefited property owners must be reviewed to determine if it is valid. A valid petition is one that has been signed by at least 35 percent of adjacent benefiting property owners, otherwise there must be 4/5ths approval by the Council. However,Dietz noted that the Council has asked staff to attempt to attain 50 percent support by property owners to avoid particularly contentious special assessment hearings. Dietz noted that there are about 500 septic systems still in use in Eden Prairie. The Inspections Department is currently conducting a survey to pinpoint exactly how many systems exist and how to get all residents connected to City utilities. Dietz noted that,with the exception of Willow Creek Road, future assessments should not be as expensive as the Highview/Lakeland Terrace project. He noted that the assessment policy developed in 1989 is designed: • Not to force property owners off of their properties • For new development to pay for the full costs associated with streets and utilities • The method of distributing costs in an assessment district must be consistent by class of property. Dietz noted that it is not legally permissible to treat a property owner with a financial hardship differently than the other property owners. Questions Councilmember Sherry Butcher asked who is notified of proposed special assessments and how they are notified. Dietz said notices are sent via regular mail(not registered or certified)to property owners of record with Hennepin County. Notices are also published in the local newspaper. The City's policy is to send copies of the feasibility study to property owners and to hold neighborhood meetings to inform property owners of plans, hear concerns, and gain consensus. Councilmember Nancy Tyra-Lukens asked how the special assessment figure is determined,particularly in relation to the requirement that the assessment be equal to or less than the increased value to the property. Dietz said assessment figures are based on professional appraisals on average properties and on data gathered during past special assessment projects. The City hired a private professional appraiser to help determine the Crestwood Terrace benefit. COUNCIL WORKSHOP MINUTES July 18, 2000 Page 3 Councilmember Ron Case asked if a property owner can actually determine whether or not their property has gained the assessed value by viewing a post-project property tax statement. Dietz said that the increase in value is not necessarily apparent during the first few years after the project is completed since the City Assessor uses sales trends and does specific calculations on a home only every four years. Dietz pointed out that there must be a distinction made between the value shown on a property tax statement and the actual market value of a parcel. A question was raised about Policy 4,which states, "Assessment term for 100%petition projects shall be 5 years." Dietz explained properties covered under this policy are usually new development. A question was raised about how an assessment is handled on a single lot that can support more than one unit according to the City's guide plan. Dietz said that Policy 28 addresses this issue, and that the City can recoup the assessment if the lot is later developed into more than one unit. Strategic Issues • Speed of Projects Dietz noted that the City has the ability to accommodate those in need(as in the case of failing septic systems in the Highview neighborhood that are causing major inconveniences to some residents as well as potential lake pollution) and speed up the assessment process. However,this may result in not all property owners being"on board"with proposed plans when the public hearing is held. Councilmember Case asked if the remaining septic systems in Eden Prairie are mostly widely spaced single residences with septic systems or entire neighborhoods/areas where septic systems are in use. Dietz said staff will know more about this when the Inspections survey is completed later this year. Mayor Harris asked if the remaining special assessment projects are likely to be council-driven rather than petition-driven. Dietz said he anticipates most projects will be council-driven. • Assessment Hearing Prior to Award of Contract Dietz explained that staff is proposing a new policy of holding the special assessment public hearing the same evening the contract is scheduled to be awarded. Dietz said he has heard of legal firms trying to solicit clients before a public hearing,telling them they can get their assessments reduced. By awarding the contract the same COUNCIL WORKSHOP MINUTES July 18,2000 Page 4 evening as the final assessment hearing,the Council is able to see how many objections are raised and then decide whether or not to award the contract. • Standard Design vs. Specialty Design vs. Cost Dietz said the standard design for utility projects is to open cut and not install concrete driveways. In projects such as Lakeland Terrace,where residents objected to open cutting due to possible destruction of mature trees, special designs are implemented. However, special designs can be more costly. Dietz explained that after hearing residents' concerns at the initial Special Assessment Public Hearing the Council delayed action. City Engineer Al Gray then sent a survey to Lakeland Terrace residents asking whether they would prefer a gravity or a low-pressure system. Gray also held another neighborhood meeting, during which general agreement was reached on a low-pressure system that will avoid disturbing landscaping. Dietz said that in the future, staff will likely be doing more design work as part of the feasibility study on hard-to-build special assessment projects (particularly ones that involve woods or lakefronts)before public hearings are held. Mayor Harris asked how staff plans to address anticipated challenges of the Willow Road utility project. Dietz said that the Willow Road project is budgeted for in the CIP,but that final cost will be determined by how much special design is required. Current Projects—Cedar Forest and Highview Assessments Mayor Harris noted that the assessment for the Highland area is $19,600, in contrast to $19,060 for Lakeland Terrace. Harris asked how these slightly different figures were calculated. Dietz said that while the actual cost of the Highland project(which includes streets and utilities)is just over$33,000,residents are responsible only for paying the $19,600 assessment cap. On the other hand,Lakeland Terrace is scheduled only for utilities,the total cost of which is$19,060 per lot(just under the assessment cap). Harris asked if it was common for a neighborhood to come back to the City and ask for streets in a case such as Highview/Lakeland. Dietz replied that it is unlikely that Lakeland Terrace would now request streets since all property owners would have to agree to grant rights- of-way. Charlson Area Special Assessment Dietz said that the planned improvements for the Charlson Area project are necessary to develop the property and that there is no question as to the benefits. Dietz explained that MAC plans to acquire an additional 157 acres in the special assessment area and that the City's special assessment against this property will come to $3.8 million. However, COUNCIL WORKSHOP MINUTES July 18, 2000 Page 5 MAC has indicated that they object to the assessment since they have filed for condemnation of these acres. Dietz reported that the property owner, Lynn Charlson,has agreed to the assessment levy and that although MAC has applied for condemnation,they have not yet taken possession of the property. Dietz encouraged the Council to approve the project, since MAC will still have the right to appeal the decision if they so choose. The staff s stand, on advice from the City Attorney's, is that MAC does not have an interest in the project since they haven't yet taken possession of the land. Dietz further noted that development of CSAH 4 as part of this special assessment is necessary for the Grace Church project to go forward. III. OTHER BUSINESS V. COUNCIL FORUM VH. ADJOURNMENT Mayor Harris adjourned the meeting at 6:55 p.m.