PUBLIC IMPROVEMENT SPECIAL ASSESSMENTS POLICY...

PUBLIC IMPROVEMENT SPECIAL ASSESSMENTS POLICY Champlin, Minnesota March, 2003 I. GENERAL.........................................................................................…............Page 2 II. ASSESSMENT UNITS DEFINED......................................................….........Page 5 III. SANITARY SEWER IMPROVEMENTS................ .......................................Page 6 IV. WATERMAIN IMPROVEMENTS.................................................................0 V. STORM SEWER IMPROVEMENTS.............................................................Page 15 VI. STREET IMPROVEMENTS...............................................................….......Page 18 VII. SENIOR CITIZEN DEFERRALS............................................................…...Page 24 VIII. CITY DEFERRALS..................................................................................…...Page 25 IX. ASSESSMENT PROCESS........................................................................… .Page 26

Special Assessments Policy

I. GENERAL

Minnesota State Statute, Chapter 429 provides that a municipality shall have the power to make public improvements such as sanitary sewer, storm sewer, water trunk, source and storage facilities, street improvements including grading, curb and gutter, surfacing, sidewalks, street lighting, etc. The various procedures the municipality must follow, including reports, notices and public hearings, are well defined within the law.

The Statute further provides that the cost of any improvement may be assessed upon property benefited by the improvement based upon the benefits received whether or not the property abuts on the improvement and whether or not any part of the cost of the improvement is paid from Municipal State Aid funds or other outside funds. The law is not specific on how these benefits are to be measured or how the costs are to be apportioned, but rather makes it incumbent upon the municipality to determine, with assistance of any engineer or other qualified personnel, a fair and equitable method of cost sharing among the properties involved. Competitive bids are required for all improvements in excess of $50,000. The threshold is $25,000 when work is done by day labor and a registered engineer is needed to supervise the work.

The purpose of this assessment manual is to set forth a guide to be utilized by the Engineering Department when preparing assessment rolls for approval by the City Council so as to assure uniform and consistent treatment to the various properties from year to year. All references used will be the latest version thereof.

Current Champlin standards require developers to install public watermain, sanitary sewer, streets, storm sewer and street lighting. The developer must provide the City with a letter of credit for one hundred and ten percent (110%) of the City Engineer's estimated project cost of the required improvements, Reference 2. If the cost of the improvements, as determined after receipt of bids for construction, exceeds the City Engineer's estimate by 10% or more, the letter of credit shall be increased proportionately. Upon completion of the improvements, the City shall levy assessments, in equal annual installments plus interest, against the benefiting property over a five (5) year period for residential development. The letter of credit shall be adjusted to one hundred percent (100%) of the actual assessment. After the balance of the principal of the assessment is less than the security agreement, the letter of credit can be reduced as assessments are paid at the rate of one dollar for each dollar paid. For developments other than residential, the subdivider shall provide the City with a letter of credit for one hundred and ten percent (110%) of the City Engineer's estimated cost of the required improvements. If the cost of the improvement, as determined after receipt of bids for construction, exceeds the City Engineer's estimate by 10% or more, the letter of credit


shall be increased proportionately.

The City shall levy assessments, in equal annual installments plus interest, against the benefiting property over a period of 15 years on existing commercial/residential properties at the time that assessments are levied against a project. At the time the assessments are levied on a project, the existing letter of credit shall be adjusted to one hundred percent (100%) of the actual assessment. After the balance of the principal is less than the amount of the security agreement, the letter of credit can be reduced as assessments are paid at the rate of one dollar for each dollar paid.

The projected cost of future public improvements for utilities and streets proposed under the City’s 5-year Capital Improvement Program shall be paid by the developer as part of the development agreement.

If the new development will have frontage on the street to be improved (excluding double fronted lots), the developer may waive his and future owners’ rights to public hearings and right to appeal and agree to be assessed for the costs when the project is constructed. This document will then be filed at Hennepin County as a lien on the property.

On lot splits where the utilities and streets were privatley installed by the developer, no additional assessment fees will be collected upon lot split. If the utilities and streets were installed as a public improvement project and not fully assessed, the balance will be collected as fees upon lot split and/or development. If a project is initiated by the City, a four-fifths vote is required by City Council. No financial guarantees are required on City-initiated projects. Pending assessments will be placed on properties after the public hearing when the project is ordered.

No special assessments will be levied against those properties described as follows:

1. Permanent Drainage Ponds 2. Cemeteries

3. U.S. Government owned properties

The total cost of a public improvement includes the construction cost plus overhead. Due to projects being assessed prior to construction of the project, the City utilizes an overhead of 35 percent based on the following:

1. Construction Contract Estimated amount to be paid to the contractor.

2. Administrative, Legal

and Fiscal Estimate of 6%. The estimate breaks down to 5% administrative, .5% legal and .5% fiscal.


3. Engineering - Consultant Percentage calculated according to City

Engineering Curve. Estimate of 8% - City Flat rate of 2%.

4. Staking Estimate of 4%

5. Inspection Estimate of 7% for one construction season and

8% for two construction seasons.

6. Geotechnics Estimate of 1%

7. Easement Preparation Estimate of 1%

8. Easement Acquisition Estimate of 1%

9. Assessments - Consultant Estimate of 1% - City Flat rate of 1%

10. Contingency Estimate of 2%

11. Interest Made & Paid Estimate of 1%

TOTAL OVERHEAD TO BE USED 35%

2% contingency is included in the construction costs. If the project is not financed by bonds, the overhead may be lowered by 0.5% to 34.5%. This overhead policy was approved by the City Council on February 27, 2006. The overhead may fluctuate based upon the actual or projected costs of the project. If the City decides to assess the project after construction, the actual cost will be used.

Any contributing funds from the City (i.e., cooperative agreement funds, park funds, sewer trunk funds, water trunk fund, TIF) or outside governmental agencies will be deducted from the total improvement cost to determine the assessable cost.

Generally the assessment period is five years for new residential development and 15 years for new commercial development.

The assessment interest rate charged to property owners is approximately 2% above the bonding rate. This is to cover any shortages in the bond fund due to nonpayment of assessments by property owners. The assessment rate is set by the City Council at the assessment hearing.

It should be emphasized that the special assessment methods and policies summarized herein


cannot be considered as all-inclusive and that unusual circumstances may at times justify special consideration. Exceptions shall be approved by City Council. Also, any fixed cost data and rates presented herein may be adjusted from year to year so as to reflect current costs.

II. ASSESSMENT UNITS DEFINED

A. Area

Area used is the gross area of each parcel as it is benefited by each separate improvement. All properties within the assessment area are to be included. Assessment area is recommended by the City Engineer and approved by the City Council.

The area method is generally used for storm sewer trunk when the only improvement under current project is the storm sewer trunk.

1. Platted land already developed - Will be assessed by area of lot plus footage

area for typical street fronting home.

2. Platted land not yet developed - Cost for entire area of subdivision is divided by number of lots in subdivision.

3. Unplatted Land - Cost is assessed for entire acreage of unplatted land, including footage area from property line to centerline of street. If a property is presently being used as a residential home, but is located in

commercially zoned area, the property is actively assessed as a residential property. The portion of the assessment for the difference between residential and commercial rate is deferred, generally until such time as the property is

used for commercial use.

B. Unit Basis of Assessment

All properties, whether new construction, reconstruction or mill and overlays in existing areas, to be assessed on a Unit Basis. This is to be used on sanitary sewer, water, storm sewer, streets, sidewalks, trails, street lighting and seal coating.

C. Caps on Amount to be Assessed

A cap on assessments would be placed on reconstruction of streets and utilities for residential property owners, including parks, water towers, wells and lift stations in accordance with the policy outlined herein, to 50 percent of the project costs, or appraised value, whichever is lower. New construction of streets and utilities in existing developed areas would be assessed 100 percent of the project, or appraised


value, whichever is lower. On MSA and County roads residential properties, including parks, water towers, wells and lift stations would pay 100 percent residential street cost. Apartments, condominiums and town homes would also pay 100 percent of residential street cost. Industrial/commercial properties and churches, schools, libraries and City Hall would pay 100 percent of actual MSA or County road up to 42 foot width.

Determination of classification of property is based on the City Land Use Map.

III. SANITARY SEWER IMPROVEMENTS

A. Definitions 1. Sanitary Sewer Service District

This is the total area that a sewer trunk is designed to serve and that benefits from the sewer construction as defined by maps and drawings prepared by the City Engineer/Consulting Engineer.

2. Sanitary Sewer Interceptors

A network of relatively large diameter, deep sewer pipes and associated pumping stations and appurtenances. The MCES constructs, owns and operates interceptor sewers as well as treatment facilities within the 7-County Minneapolis St. Paul metropolitan area. The interceptors are designed as collectors for large areas within two or more communities.

3. Sanitary Sewer Trunks and Subtrunks

A network of pipes ranging in size generally larger than 8 inches in diameter extending away from respective interceptor mains. Lift stations and force mains are considered part of the sewer trunk system. The trunks and subtrunks are designed as collectors for areas usually less than 500 acres.

4. Sanitary Sewer Laterals

Sanitary network of pipes, usually 8" in size which are installed 10-12 feet deep and are designed to serve those buildings abutting a given street or easement. The laterals drain to trunks, subtrunks or directly to interceptors.

5. Sanitary Sewer Services

Those pipes, usually 4" or 6" in size leading from homes or businesses to laterals (or sometimes from trunks, subtrunks and interceptors). The services


are capped at the property line until such time that the building is connected to the sewer system.

The property owner must make arrangements with a licensed, bonded plumber to complete the service connection.

All properties must connect to sewer within two years after service becomes available to the property. If the property owner does not connect within two years, the City will contract a private plumber to complete connection and the cost will be added as a special assessment to the property.

6. Sewer Availability Charge (SAC)

This fee is collected by the Building Department upon connection of each property to the public sanitary sewer system. This fee is collected by the City for each connection to the public sanitary sewer system and is used by the MCES for upkeep of the sewage treatment plant, etc.

7. Sanitary Sewer User Charges

These charges are billed monthly to properties connected to the sewer system and cover maintenance and operating costs of sewer lines, pumping and treatment facilities. Current sewer rates can be obtained from the Finance Department.

Any delinquent sewer user charges not paid as of November 30th of each year will be considered supplemental special assessments against the respective properties served. All costs, including penalties, shall be certified to the County Auditor for collection.

B. Determining Sanitary Sewer Improvement Assessment Rates on New Construction

Projects in Existing Development Areas

1. Sanitary Sewer Lateral

The sanitary sewer lateral cost to be assessed to equivalent residential properties, including single family units, duplexes, and triplexes is determined on a unit basis at 100 percent of the actual project cost, or appraised value, whichever is lower. Parks pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the


general levy taxes over the life of the assessment.

The sanitary sewer lateral to be assessed to multi-family (above 3 units) to be assessed on a unit basis for 100 percent costs, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.

Commercial/industrial properties to be assessed for 100 percent of actual

construction costs on unit basis, or increase in value, whichever is lower. The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family. Churches and schools, libraries and City Hall to pay at the commercial rate.

2. Sanitary Sewer Service

The sanitary sewer service rate is determined by taking the total sanitary sewer service installation costs for same size services, including overhead and dividing by the number of services installed of that same size service.

If services are installed and any are augered across a roadway to serve a property, the additional cost of augering is spread over the entire project.

3. Sanitary Sewer Trunk

Sanitary sewer trunk is determined by taking the total sanitary sewer trunk project costs with overhead in the district or sub-district set up, and dividing by the number of units (each lot is equal to one unit). If the lot can be split, one unit would be assessed actively and the remaining unit would be deferred. In multi-family and commercial/industrial areas, the sanitary sewer trunk assessment is based upon the estimated sewer usage relative to a single family unit. Town homes and condominiums are assessed at a single-family rate. The calculation of units is based on the same method used for Water Trunk, Source and Storage Fee outlined under Section IV, Subsection E of this document.

C. Determining Sanitary Sewer Assessment Improvement Rates on Redevelopment


1. Sanitary Sewer Lateral

The sanitary sewer lateral cost to be assessed to residential properties,


including single family units, duplexes, and triplexes, is determined on a unit basis at 50 percent of the actual project cost, or appraised value, whichever is lower. Parks pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The sanitary sewer lateral to be assessed to multi-family (above 3 units) on a unit basis for 100 percent of reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.


construction costs on unit basis, or increase in value, whichever is lower. The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family. Churches, schools,

Libraries and City Hall would pay at the commercial rate.

2. Sanitary Sewer Service

The sanitary sewer service rate is determined by taking the total sanitary sewer service installation costs for same size services, including overhead, and dividing by the number of services installed of that same size service.

If services are installed and augered across a roadway to serve a property, the additional cost of augering is spread over the entire project.

3. Sanitary Sewer Trunk

Sanitary sewer trunk is determined by taking the total sanitary sewer trunk project costs with overhead in the district or sub-district set up, and dividing by the number of units (each lot is equal to one unit). If the lot can be split, one unit would be assessed actively and one unit would be deferred. In multi-family and commercial/industrial areas, the sanitary sewer trunk assessment is based upon the estimated sewer usage relative to a single family unit. Town homes and condominiums are considered single family units. The calculation of units is to be based on the same method used for Water Trunk, Source and Storage Fee outlined under Section IV, Subsection E.


D. Determining Sanitary Sewer Assessment Improvement Rates for New Construction

in Undeveloped Areas

1. Public Projects The developers/owners to provide the City with petition, waivers of public

hearing, and wavier of assessment hearing and appeal. The developers/ owners to provide a letter of credit amounting to 110 percent of the project cost, based on the estimated project cost. The developer/owner to pay their portion of the costs, as negotiated at the beginning of the project, at the end of the project. After full payment, the letter of credit will be canceled by the City. The project may be assessed with approval of the City Council.

2. Private Projects

Continue to accept developers doing private improvement projects with the City having full review and full inspection control, with all costs paid by the developers. A letter of credit or cash for 110 percent of the construction costs to be furnished to City. A development agreement to be approved and all funds required therein to be in place with the City prior to commencement of construction. The developer/owner to pay their portion of the costs, as negotiated at the beginning of the project, at the end of the project. After full payment , the letter of credit will be canceled by the City. The project may be assessed with approval of the City Council.

IV. WATERMAIN IMPROVEMENTS

A. Definitions

1. Source of Water Supply

The current source of water supply for Champlin is seven (7) wells. Treatment includes iron and manganese removal, chlorination for disinfectant, fluoridation for stronger teeth, and polyphosphate for PH control.

2. Water Trunk and Subtrunk Distribution Mains

A network of pipes and related appurtenances usually in the size range of 12" to 24". These pipes are designed to carry large volumes of water and interconnect various point sources of water supply and storage reservoirs.


3. Watermain Laterals

A network of water pipes and related appurtenances usually 6" or 8" in size which are installed with about 7 feet of ground cover to retard freezing and are designed to serve those buildings abutting a given street or easement. Lateral mains are "looped" wherever possible to balance pressures and prevent "dead ends" with associated problems.

4. Watermain Service

These pipes lead from laterals (or sometimes from trunk and subtrunk mains) and serve individual buildings abutting thereon. The size of the service usually ranges from 1" to 6", depending upon the type of building served. The lines terminate at the property line with a shut off valve and are plugged until such time that the building is connected to the water system. The property owner must make arrangements with a licensed, bonded plumber to complete the service connection.

5. Water User Charges

These charges are billed on a monthly basis to properties connected to the water system. The charges cover maintenance and operation costs of the water system.

Any delinquent water charges will be treated in the same manner as the sewer charges described on the second paragraph of III A 7 of this document.

6. Watermain Trunk, Source and Storage Fees

When watermain is extended to a property with a home, apartment, etc., the property is assessed for the Watermain Trunk, Source and Storage fee on a unit basis. The property owner may, by written request prior to November 30th of the year the project is assessed, have the Water Trunk, Source and Storage fee removed from the assessment roll and pay this fee upon connection. The assessment of the Water Trunk, Source and Storage fee assists the property owner in spreading the cost over the period of the assessment rather than having to pay this lump sum amount. If the property owner chooses to pay on connection, the property owner must pay the current rate at time of connection. If there is no building on the property, the property is not assessed for the Watermain Trunk, Source and Storage fee, but pays this fee at the time a building permit is issued. The rate is established by resolution and is updated periodically. Currently the Water Trunk, Source and Storage fee has been set at $2,000 for 2002, and will increase $100 per


year each year until 2017.

The method of assessment calculation, based on the number of units, is as follows:

a. All single-family residential properties are assessed on a per unit

basis.

b. Duplexes and triplexes are assessed on a per unit basis. .

c. Apartment buildings are assessed at the rate of 80% of the single-family rate.

d. All commercial properties are assessed based on the number of units

charged on sewer usage. This is governed by the Metropolitan Council Environmental Services (MCES) “Reserve Capacity Charge Manual”. (i.e., if the usage is such that property would be charged eight (8) SAC units, the Water Trunk, Source and Storage fee would be charged at a rate for 8 units). The cost of the Water Trunk, Source and Storage fee will be updated January 1st of each year through the year 2017, and will increase $100 each year.

B. Determining Watermain Assessment Improvement Rates on New Construction


1. Water Lateral The water lateral cost to be assessed to residential properties, including single family, duplexes, and triplexes, is determined on a unit basis at 100 percent of the actual project cost, or appraised value, whichever is lower. Parks pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The water lateral to be assessed to multi-family (above 3 units) on a unit basis for 100 percent of residential street and utility reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.


Commercial/industrial properties to be assessed for 100 percent of actual construction costs on unit basis, or increase in value, whichever is lower. Churches and schools would pay at the commercial rate. The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family.

2. Water Service Connection

The water service connection rate is determined by taking the total water service installation costs for same size services, including overhead and dividing by the number of services installed of that same size service.

If services are installed and any are augered across a roadway to serve a property, the additional cost of augering is spread over the entire project. Properties to be assessed as mentioned above or the increase in value,

whichever is lower.

C. Determining Water Assessment Improvement Rates on Redevelopment Projects in Existing Development Areas

1. Water Lateral

The water lateral cost to be assessed to residential properties, including single family, duplexes, and triplexes is determined on a unit basis at 50 percent of the actual project cost, or appraised value, whichever is lower. Parks pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The water lateral to be assessed to multi-family (above 3 units) to be assessed on a unit basis for 100 percent of residential street and utility reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.


construction costs on unit basis, or increase in value, whichever is lower.


The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family. Churches and schools would pay at the commercial rate.

2. Water Service Connection

The water service connection rate is determined by taking the total water service installation costs for same size services, including overhead and dividing by the number of services installed of that same size service. If services are installed and augered across a roadway to serve a property, the additional cost of augering is spread over the entire project.

. D. Determining Water Assessment Improvement Rates for New Construction in

Undeveloped Areas

1. Public Projects

The developers/owners to provide the City with petition, waivers of public hearing, and waiver of assessment hearing and appeal. The developers/ owners to provide a letter of credit amounting to 110 percent of the project cost, based on the estimated project cost. The developer/owner to pay their portion of the costs, as negotiated at the beginning of the project, at the end of the project. After full payment, the letter of credit will be canceled by the City. The project may be assessed with approval of the City Council.

2. Private Projects

Continue to accept developers doing private improvement projects with the City having full review and full inspection control, with all costs paid by the developers. A letter of credit or cash for 110 percent of the construction costs to be furnished to City. A development agreement to be approved and all funds required therein to be in place with the City prior to commencement of construction. After full payment, the letter of credit will be canceled by the City.

E. Determining Water Trunk, Source and Storage Fee

1. Each existing single-family residential unit is assessed one unit of Water

Trunk, Source and Storage. No assessment is made for Water Trunk, Source and Storage on vacant lots. The Water Trunk, Source and Storage fee is paid upon connection of new homes. Duplexes are assessed one trunk, source and storage fee for each unit.

2. Apartment units are assessed at 80% of the regular single-family residential


rate. The assessment rate is established by resolution and is updated periodically. Currently the Water Trunk, Source and Storage fee is $2,000 as of January 1, 2002 and will increase $100 per year each year until 2017.

Commercial/Industrial Property - charged at a rate of $2,000 per unit. The number of units to be charged is based on sewer usage. This is governed by the Council Environmental Services (MCES) "Reserve Capacity Charge Manual" (i.e., if the usage is such that property would be charged eight SAC units, the Water Trunk, Source and Storage fee would be charged at a rate for eight units.)

3. On vacant land or empty lots, the fee is not assessed as part of the project but

is collected as a connection fee along with the building permit. The fee on commercial properties is dependent upon anticipated usage based upon the MCES Reserve Capacity Charge Manual (latest edition.)

V. STORM SEWER IMPROVEMENTS

A. Definitions 1. Storm Sewer System

Network of open channels and pipes, ranging in size from 12" to approximately 66" for conveyance of surface runoff from rainstorms, have an estimated intensity and duration based upon 5 to 10-year design storm for lateral system and a 100-year, 24-hour design storm for trunk.

The City utilizes a minor and major storm sewer system in a drainage area. The minor storm sewer system is the lateral piping that conveys the water from the streets to the holding ponds. When the water inundates the minor system, the major system, i.e., streets and ditches, would convey the water within the drainage area to the holding pond(s). For this method to work, the drainage area has to be shaped like a saucer. Future developments would not be allowed to have more than one foot of water in the center of the streets before the water would flow overland from the local low area by the major storm sewer systems to the holding pond(s) within the drainage area. This would not only prevent basements from being flooded, but would also allow safety vehicles to operate during the design storm.

2. Storm Sewer Service District

The service district is the total area for which the system is designed and which will benefit from the construction. The extremities of the district usually conform closely with the natural or proposed watershed lines. Runoff from areas beyond the watershed line will drain into some other


district.

Resolutions 88-97 and 88-105 Established Storm Sewer Districts 10A and 10B for the Central Portion of the City (Reference 3.) These costs are updated annually according to the Consumer Price Index. A Resolution Updating Fees Under the City's Special Assessment Manual, containing the updated Storm Sewer District Rates and typical assessment rates are attached for approval (Reference 4.)

B. Determining Storm Sewer Assessment Improvement Rates on New Construction


1. Storm Sewer Lateral

The storm sewer lateral cost to be assessed to residential properties, including single family, duplexes, and triplexes, is determined on a unit basis at 100 percent of the actual project cost, or appraised value, whichever is lower. Parks, water towers, wells, and lift stations pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The storm sewer lateral to be assessed to multi-family (above 3 units) on a unit basis for 100 percent of reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.

Commercial/industrial properties to be assessed for 100 percent of actual construction costs on unit basis, or increase in value, whichever is lower. Churches, libraries and City Hall and schools would pay at the commercial rate. The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family.

2. Storm Sewer Trunk

Storm sewer trunk is determined by taking the total storm sewer trunk project costs with overhead in the district or sub-district set up, and dividing by the number of units (each lot is equal to one unit). If the lot can be split,


one unit would be assessed actively and one unit would be deferred. In multi-family and commercial/industrial areas, the storm sewer trunk assessment is based upon the estimated sewer usage relative to a single family unit. The calculation of units is to be based on the same method used for Water Trunk, Source and Storage Fee outlined under Section IV, Subsection E.

C. Determining Storm Sewer Assessment Improvement Rates on Redevelopment


1. Storm Sewer Lateral

The storm sewer lateral cost to be assessed to residential properties, including single family, duplexes, and triplexes is determined on a unit basis at 50 percent of the actual project cost, or appraised value, whichever is lower. Parks, water towers, wells and lift stations pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The storm sewer lateral to be assessed to multi-family (above 3 units) to be assessed on a unit basis for 100 percent of residential street and utility reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.


construction costs on unit basis, or increase in value, whichever is lower. The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family. Churches, libraries

and City Hall and schools would pay at the commercial rate.

2. Storm Sewer Trunk

Storm sewer trunk is determined by taking the total storm sewer trunk project costs with overhead in the district or sub-district set up, and dividing by the number of units (each lot is equal to one unit). If the lot can be split, one unit would be assessed actively and one unit would be deferred. In multi-family and commercial/industrial areas, the storm sewer trunk assessment is based


upon the storm sewer usage relative to a single family unit.

D. Determining Storm Sewer Assessment Improvement Rates for New Construction in Undeveloped Areas

1. Public Projects

The developers/owners to provide the City with petition, waivers of public hearing, and waiver of assessment hearing and appeal. The developers/ owners to provide a letter of credit amounting to 110 percent of the project cost, based on the estimated project cost. The developer/owner to pay their portion of the costs, as negotiated at the beginning of the project, at the end of the project. The project may be assessed with approval of the City Council.

2. Private Projects

Continue to accept developers doing private improvement projects with the City having full review and full inspection control, with all costs paid by the developers. A letter of credit or cash for 110 percent of the construction costs to be furnished to City. A development agreement to be approved and all funds required therein to be in place with the City prior to commencement of construction.

VI. STREET IMPROVEMENTS New Street and/or Utility Construction

Streets that the existing residential property owner, previous property owner(s) or original developer has not paid for the construction of a bituminous street, concrete curb and gutter and/or utilities, will be considered a new street/utility. This property would be assessed for 100 percent of the improvement, or increase in value, whichever is lower. Existing Street and/or Utility Reconstruction Streets that the existing residential property owner, previous property owner(s) or developer has paid for the construction of a bituminous street, concrete curb and gutter and/or utilities will be considered an existing street/utility. This property would be assessed for 50 percent of the improvement, or increase in value, whichever is lower. As an example, if a current or previous residential property owner (s) or the original developer paid for a bituminous street on the property being improved, but not concrete curb and gutter, the property owner would pay for 50 percent of the existing bituminous street and 100 percent of the new concrete curb and gutter, or the assessed amount, whichever is lower. If a current or previous residential property owner (s) or the developer had paid for water, sanitary sewer and/or storm sewer on the property being improved, the current residential property owner will pay for the reconstruction


of that utility at 50 percent of the cost, or the assessed amount, whichever is lower. A. Definitions

1. Federal, State and County Highways

These streets are classified as expressways, freeways and principal arterials

constructed and maintained by the State or County Highway Departments. They carry large volumes of traffic at peak loading times.

2. MSA Streets

These are termed collector streets or minor arterials which interconnect other minor arterials, collector streets, State, or County highways, or with MSA streets. A typical MSA street 32 foot to 44 foot with a curb and gutter) is built to a 9-ton design.

3. Residential Streets

This is the minimum street design acceptable as a permanent public street within new subdivisions or developments. They carry relatively small volumes of local neighborhood traffic. The typical residential street design is 31-foot back of curb to back of curb, with concrete curb and gutter.

In areas where streets are installed at dead ends, street curb and gutter will be extended all the way to the end of a property.

4. Sidewalks

A typical sidewalk is concrete, five (5) feet wide.

Sidewalks on residential streets in existing areas shall be petitioned by property owners on both sides of the street.

Sidewalks on arterial and collector streets may be either petitioned by adjacent property owners or initiated by the City along such roads as, but not limited to, 117th Avenue North, 114th Avenue North, Cartway Road, etc.

5. Trails

A typical bituminous trail is 8' wide.

Bituminous trails on residential streets in existing areas that is initiated by the City and will be paid by the City.


Bituminous trails on arterial and collector streets may be petitioned by adjacent property owners or initiated by the City along such roads as, but not limited to, Winnetka Avenue, West River Road, and Douglas Drive. The cost of the trails to be paid by the City.

6. Street Lighting

Street lighting is generally installed with all street projects in new developments.

7. Seal coating

Seal coating is assessed on all new and redeveloped City streets. First time seal coating is done approximately three years after the final wear coarse is completed on an MSA or residential street.

B. Determining Street, Sidewalk, Trails and Street Lighting Improvement Assessment Rates on New Construction Projects in Existing Development Areas for the

City’s Residential and Municipal Streets, and State and County Roads

1. Streets, Sidewalk, Trails and Street Lighting

The streets, trails and street lighting costs to be assessed to residential properties, including single family units, duplexes, and triplexes is determined on a unit basis at 100 percent of the actual project cost, or appraised value, whichever is lower. The City will pay for sidewalks for residential equivalent units along MSA and County streets whether initiated by a petition or City initiated. Property owners are to pay for sidewalks along non-MSA streets per this policy. Parks, water towers, wells and lift stations pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The streets, trails and street lighting costs to be assessed to multi-family above 3 units) to be assessed on a unit basis for 100 percent of residential street and utility reconstruction costs, or increase in value, whichever is lower. On MSA and County roads, residential properties, parks, water towers, lift stations and wells would pay 100 percent of residential street cost (31’ width), or increase in value, whichever is lower. Apartments,


condominiums and town homes would also pay 100 percent residential street cost, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.

Commercial/industrial properties to be assessed for 100 percent of actual construction costs on unit basis, or increase in value, whichever is lower. On MSA and County roads, industrial/commercial properties, churches, schools, libraries, and City Hall would pay 100% of actual MSA or County road up to 42 foot width.

C. Determining Mill and Overlay Improvement Assessment Rates for Construction in Existing Developed Areas

1. The residential, including trails and street lighting, to be assessed to

residential properties, including single family, duplexes, and triplexes, is determined on a unit basis at 50 percent of the actual project cost, or appraised value, whichever is lower. Parks, water towers, lift stations and wells pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the park to a depth of 165 feet from the front of the property back divided by typical residential lot size (14,434 sf.) Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment. Residential properties would pay on MSA and County streets at a rate of 50 percent of the typical residential street rate.

The residential streets and County roads, including trails and street lighting, to be assessed to multi-family (above 3 units) on a unit basis for 100 percent of residential street and utility reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for multi-family would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.), using footage up to two long sides of property. Three sided lots will not be assessed for third side. The number of multi-family units would be derived by taking the area of the parcel to 165’ depth. On MSA and County roads, the properties to pay 100 percent of typical residential street cost.

Commercial/industrial properties to be assessed for 100 percent of actual construction costs on unit basis, or increase in value, whichever is lower. Churches and schools would pay at the commercial rate. The number of units to be assessed would be derived in the same manner as multi-family.


The number of units to be assessed for industrial/commercial properties which would be derived by taking the area of the parcel and dividing it by the typical residential lot size (14,434 sf.), using footage up to two long sides of the property. Three sided lots will not be assessed for the third side. The number of multi-family units would be derived by taking the area of the parcel to 165’ depth. The number of commercial/industrial properties would be derived by taking the area of the parcel to 165 foot depth. On MSA and County roads, commercial/industrial properties would pay 100 percent of actual street cost up to 42 foot width.

D. Determining Seal Coat Fees on New and Existing Residential Street or MSA

Street Construction Projects on Reconstruction Projects in Existing and Un- developed Areas

The seal coating cost to be assessed to residential properties, including single family, duplexes, and triplexes, is determined on a unit basis at 100 percent of the actual project cost, or appraised value, whichever is lower. Parks pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The seal coat fee to multi-family (above 3 units) to be assessed on a unit basis, or increase in value, whichever is lower. The number of units to be assessed for benefiting multi-family properties would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) The area of the lot is to be derived by taking the length of all streets abutting the benefiting property and multiplying by the depth of 165 feet.

Commercial/industrial properties to be assessed for 100 percent of cost on a unit

basis, or increase in value, whichever is lower. Churches and schools would pay at the commercial rate. The number of units to be assessed for commercial/industrial properties would be derived in the same manner as multi-family.

E. Determining Street, Sidewalks, Trails and Street Lighting Improvement Assessment Rates on Redevelopment Projects in Existing Development Areas for the City’s Residential Streets and State and County Roads

The residential and MSA streets and County roads, including trails and street lighting to be assessed to residential properties, including single family units, duplexes, and triplexes, is determined on a unit basis at 50 percent of the actual project cost, or appraised value, whichever is lower. The City will pay for sidewalks along MSA


streets adjacent to equivalent single family units, whether initiated by the City or petition from property owners. All property owners are to pay for sidewalks along non-MSA streets per this policy. Parks pay at the same rate on a unit basis as residential properties. The number of units for a park is derived by taking the area of the benefiting park divided by typical residential lot size (14,434 sf.) The area of the park is to be derived by taking the length of all streets within the project abutting the property and multiplying by the depth of 165 feet. Park assessments would continue to be paid as part of the general levy taxes over the life of the assessment.

The residential, MSA and County roads, including trails and street lighting, to be assessed to multi-family (above 3 units) on a unit basis for 100 percent of residential street and utility reconstruction costs, or increase in value, whichever is lower. The number of units to be assessed for multi-family would be derived by taking the area of the multi-family parcel and dividing it by the typical residential lot size (14,434 sf.) On MSA and County roads, the properties to pay 100 percent of typical residential street cost.

Commercial/industrial properties to be assessed for 100 percent of actual construction costs up to a maximum of 42' width on unit basis, or increase in value, whichever is lower. Churches and schools would pay at the commercial rate. The number of units to be assessed would be derived in the same manner as multi-family. The number of units to be assessed for industrial/commercial properties would be derived by taking the area of the parcel and dividing it by the typical residential lot size (14,434 sf.) The number of commercial/industrial properties would be derived by taking the area of the parcel to 165 foot depth.

F. Determining Streets, Sidewalks, Trail and Street Lighting Assessment Improvement

Rates on for New Construction in Undeveloped Areas

1. Public Projects The developers/owners to provide the City with petition, waivers of public hearing, and waiver of assessment hearing and appeal. The developers/ owners to provide a letter of credit amounting to 110 percent of the project cost, based on the estimated project cost. The developer/owner to pay their portion of the costs, as negotiated at the beginning of the project, at the end of the project. The project may be assessed with approval of the City Council.

2. Private Projects

Continue to accept developers doing private improvement projects with the City having full review and full inspection control, with all costs paid by the developers. A letter of credit or cash for 110 percent of the construction costs to be furnished to City. A development agreement to be approved and all funds required therein to be in place with the City prior to commencement


of construction.

VII. SENIOR CITIZEN DEFERRALS

Minnesota Statute 435 authorizes the City, upon proper application, to defer the payment of special assessments against any homestead property owned by a person 65 years of age or older or a person retired by virtue of a permanent and total disability on January 1st of the payment year and for whom it would be a hardship to make the payments. A resolution outlining the City's policy on these deferrals is outlined in Resolution No. 2006-25, dated January 23, 2006, copy attached as Reference 5.

The interest charged is at the same rate charged for the rest of the project. The Champlin City Council has determined that the deferral of assessments should be granted to any person otherwise qualified who shall make proper application claiming that the annual principal and interest due on an assessment is in excess of three (3) percent of his current annual income, and, therefore, a hardship to him. The proper application form shall be provided by the City. A person retired by virtue of a permanent and total disability must qualify for the 3CC. classification for property tax purposes.

Special assessments against any homestead property owned by a person 65 years of age or older, or a person retired by virtue of a permanent and total disability for whom it would be a hardship to make the payment, may be deferred subject to the aforementioned conditions upon submission of the appropriate application signed by the qualified person.

The interest shall be charged at the same rate as the rest of the properties in the project. This interest shall not apply to the interest of the deferment but only to the principal of the assessment. The principal and interest shall be payable in accordance with the terms and provisions of Minnesota Statutes. The right of deferment is automatically terminated as provided under Minnesota Statutes.

The application for deferments for a particular year must be submitted by November 1st of the preceding year.

The right of deferment is automatically terminated as provided under Minnesota Statutes 435.195.

VIII. CITY DEFERRALS

City deferments are handled on an individual basis, but the general guidelines are as follows:

A. Undeveloped Land

If a home exists on a property that can be split, the property is assessed. One unit is


actively assessed and the remainder is deferred until the land is more intensely developed. If there is no home on the property, the assessment on the entire parcel is deferred until more intense development.

1. Developed Lots That Can Be Split As They Are

One unit is actively assessed to the property. The remaining unit is deferred until such time as the property is more intensely developed.

2. Developed Lots That Cannot Be Split With Existing Home Placement, But

Could Be Split If Home Removed

Property is assessed a maximum of one unit. If the property is ever split in the future, the assessment for the remaining unit would need to be paid at the time a building permit is issued for a second residence.

Whenever the City has deferred an assessment until such time as the land assessed is more intensely developed, or for any other purpose, the interest on the deferred assessment shall accrue at the same interest rate and for the number of years as established for other unpaid assessments in the project or until the assessment is paid in full, as approved by Resolution 86-191 Relating to Interest on Deferred Assessments (Reference 6.)

All assessments deferred prior to November 25, 1986 have been deferred without interest.

The City reserves the right to defer or not defer projects on open land.

IX. ASSESSMENT PROCESS

Assessment Process to be modified are outlined below:

Based on the condition of the streets and utilities, staff places in the City’s Capital Improvement Project (CIP) the streets that need to be Milled and Overlaid or Reconstructed. This includes any utilities or streets that need to be reconstructed.

Staff explains to the property owners the need for either a Mill and Overlay or reconstruction of the streets and utilities with an explanation of the costs as outlined above in the policy. Using the CIP Plan and a review of the street condition, the City Council orders feasibility

study. A preliminary assessment roll is done for project, based on estimated costs as outlined in our policy.

City Council accepts feasibility study and orders public hearing.


A public informational meeting is scheduled by staff to review the feasibility study and the preliminary assessment roll with affected property owners.

Hold a Public Hearing, where City Council can order petition generated project with four-fifths vote. If project approved, order plans and specifications (at this point there is a pending assessment on the properties.)

City Council approves plans and specifications and orders bids. Appraisals are ordered out. The appraiser would need to provide local appraisal(s) that are in Champlin or surrounding communities.

City Council accepts bids and orders assessment hearing.

Prepare assessment roll and individual property owner assessment reports and mail to homeowners for Assessment Hearing.

A public informational meeting is set up by staff to review the assessment roll with affected property owners.

Hold Assessment Hearing. Hold a public hearing per Minnesota State Statute 429 to receive property owner comments on the special assessments. If, in the sole discretion of the City Council, there are sufficient appeals from the assessments, the City Council will notify property owners at the Assessment Hearing that a special hearing will be held by a Hearing Examiner approximately three weeks after the assessment hearing to review all appeals. (The City will need to be consistent in its policy from previous projects toward the number of appeals before ordering a Special Hearing.) The appraiser will be chosen from the pool of pre-qualified appraisers at the Hennepin County Court system. The City Council, by Resolution, shall appoint the Hearing Examiner. The findings of the Hearing Officer to be final.

Hold Special Hearing with appealing residents with a Hearing Examiner. The document providing the Special Assessment Rules and Procedures are found on Attachment 7. Any appealing property owners would present evidence of a value increase at the Special Hearing. At that time the appraiser hired by the City and staff would present its findings to the Hearing Examiner. The Hearing Examiner would have a week to submit the findings of facts from the Special Hearing.

The City Council would the adopt the findings of facts and approve the assessment roll.

Award contract (60 days after assessment hearing, if number of appeals are acceptable.)

REFERENCES


1. Minnesota State Statute 429, Local Improvements, Special Assessments 2. Resolution Amending the Assessment Policy for New Developments in the City of

Champlin 3. Resolution Establishing Storm Sewer District 10A and 10B,

Nos. 88-97 and 88-98 4. Resolution Updating Seal Coating, Storm Sewer District 10A and 10B and Typical

Lot Fees 5. Resolution Providing for the Deferment of Special Assessments for Persons 65 Years

of Age or Older or Persons Retired by Virtue of a Permanent and Total Disability for Whom It Would be a Hardship to Make the Payments

6. Resolution Relating to Interest on Deferred Assessments 7. Special Assessment Hearings Rules and Procedures

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