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HomeMy WebLinkAbout1997-1022 Study Session MIN MINUTES CITY COUNCIL STUDY SESSION October 22, 1997 MEETING CALLED TO ORDER: Mayor Golden called the meeting to order at 12:30 p.m. in the Council Chambers. In attendance: Councilor Laws, Hagen, Reid, Wheeldon and DeBoer. City Staff present were Jill Turner, Paula Brown, Paul Nolte, Greg Scoles, Brian Almquist, Keith Woodley and Ken Mickelsen. A. Continued Overview and Discussion of L.I.D.s It was explained that this is a continuation of a series of discussions among City Council regarding Local Improvement Districts. Paula Brown, Public Works Director submitted information to council that outlined the city street miles status and a standard city unit costs for construction. The information explained that there are 76 miles of paved city streets and 9 miles of unpaved/unimproved streets. There are 8.4 miles of streets paved through subdivision agreements and 41.0 miles of streets paved through LID's. 26.6 miles of paved streets were paved through prior "agreements" or by City assessments. Jill Turner, Finance Director submitted information to council that outlined how an LID is assessed and how the interest rate is set. All assessments using the Bancroft Bonding Act are required to pay in 20 semi- annual installments together with interest. Interest charged will be the actual bond sale interest rate plus 1.5 % with a maximum of 10 percent. Turner explained that the property owner has the right to pay over time (Bancroft) or pay the lien in full. Turner explained that as of June 30, 1997, there was $761,000 outstanding bond payments and the city is responsible for $334,000 of that amount. Turner explained why the city charges a markup on the interest rate above the bond amount. The following reasons were given: 1) To cover administrative costs; 2) To offset risk of negative net interest earnings on advance payments; 3) To offset risk of slow payment or no payments or foreclosure; 4) Markup is expected in the bond market; and 5) It is standard practice with Municipalities. Turner explained that interest earned dollars are put into the general fund and according to bond agreement, this money cannot be touched until the bond has been paid for in full. Clarified how the general fund works. Councilor DeBoer suggested that interest rates not be marked up in order to pass savings on to the property owners. Council discussion on the different types of LID's that are included in a bond sale. Discussion on how System Development Charges related to LID's and if it were possible to fund some of the costs associated with paving unpaved streets through a fund set up from SDC's. It was suggested that the SDC study include this possibility. It was clarified that the study is a Transportation Element Plan, which would include federal, state and city monies. Councilor Laws submitted a funding proposal for undeveloped and underdeveloped streets. The proposal is to adopt a comprehensive plan, complete with a firm timetable, for developing all of Ashland's un- and under- developed streets. It would also address the funding issue. The proposal would require two actions. First, to divide street improvement costs in two. The Basic Street Cost which would include the cost of streets, curbs, and gutters. The Traffic Reduction cost would include the costs of sidewalks, mass transit improvements on the street, and extra widths or pavements due to more (Council Study Session 9/17/97) than average use. The Traffic Reduction costs would be seen as a city-wide benefit and paid from a Traffic Reduction Fee, which would be part of the present monthly Street Utility Fee. The second action would be to form a city-wide LID and a new formula for street SDC's, to cover the Basic Street costs. A city-wide LID would allow us to make a comprehensive, time-certain plan for improving all the streets that need improvement. This proposal is for the City-Wide LID to assess existing benefitted properties for 1/4 of the total basic street costs. The City-Wide LID would require the approval of the landowners of the entire city, the charges would only be assessed to the benefitted properties. The remaining costs would be paid by new benefitted houses as they develop, via a revised SDC formula. That formula would also be based on the assumption that new building is what forces street improvements. Discussion regarding how fair it would be if developers delayed an improvement to a property in order to not participate in an LID. Discussion on the importance or un-importance of flexibility that the council holds when LID's are formed. Laws shared another suggestion for another formula on costs associated with LID's. It would be to divide the city into potential lots, decide which lots would benefit from an LID, and then divide the costs out according to which lots benefit. Councilor Wheeldon suggested that LID's be thought of as a standard rather than a benefit. Clarified that developers are not the only ones who play a role in the forming of an LID. Tried to explain how small property owners who subdivide smaller pieces of property can increase the impact of an area the same as a developer. Used the example of how if 9 separate property owners subdivided 9 separate lots, compared to a developer who subdivided one piece into 9 units, the impact is the same. It was strongly encouraged that those individuals concerned about LID's, should get involved in the SDC cormnittee meetings. Councilor DeBoer requested that staff include the unpaved streets in the SDC study and firm the interest rate. Mayor Golden commented on how difficult it would be to request staff to survey the city and determine the need for improvement. Because of the standards which have been set, not only for new streets, but for the inclusion of sidewalks on streets that are already paved, it would be a huge task. Commented on the choice property owners make in choosing their place of livability, it becomes an individual choice which can differ from one person to another. It was suggested that the city consider not bonding LID's, but to do private financing through the developers and discount the price. Discussion regarding run-off into streams and how it effects fish and wildlife. Comments on how it is everyones responsibility to take care of the environment. It was suggested that Jill Turner, Finance Director bring back information on the possibility of private financing. Question was raised if credit or reimbursement would be feasible if the city were to adopt a new LID plan for funding. The meeting was adjourned at 2:23 p.m. Barbara Christensen City Recorder (Council Study Session 9/17/97) 2