Consider Entering into the Transit Taxing District and Final Approval of Master Cooperation, Funding and Delegation Agreement for the Ramsey Rail Station

On 04/26/2011 the City Council was presented the proposed terms of an agreement to enter into the transit taxing district and heard a presentation by Arlene McCarthy from the Metropolitan Council regarding the condition by which the City of Ramsey may receive approval of a rail station. At that meeting the Metropolitan Council indicated that they expect to see approximately $295,000 annually from Ramsey residents when the City of Ramsey opts into the transit taxing district.

On 06/07/2011, the City Council was provided an update on the Rail Station PMT meetings and was provided another opportunity to provide feedback on the transit taxing district agreement.

On 09/27/2011, the City Council approved the Master Cooperation, Funding and Delegation Agreement contingent upon successful negotiation of the transit taxing district and lease agreements subject to the review and approval of the City Administrator and City Attorney.

On 11/7/11 the City Council discussed the terms of entering into the transit taxing district and offered the following comments:

• The parking for Northstar passengers shall be made available by the City at the parking ramp adjacent to the station and shall not be limited. (The number of stalls that are available for transit will be limited to 350 stalls.) This condition is acceptable to the Metropolitan Council.
• The City Council made it clear in two meetings that they wanted to expand transit service to the area by expanding the service that currently goes to the Anoka Technical college to the Ramsey rail station. After Mr. Byers had conversations with Pat Born and Brian Lamb from the Metropolitan Council, it was determined that this condition could not be accepted as part of the Transit Taxing District Agreement, however options for additional future transit bus service are being explored.
• The City Council also wanted the rate for the ride from Ramsey to be the same as the rate from Anoka. This is also a condition that the Metropolitan Council will not accept as the Northstar train is a distance based fare and therefore would not be fair to the other communities. Whereas, it is true that the fare is the same between Anoka and Coon Rapids ($4.00), the distance separating these stations is only 2 miles. The distance between Anoka, Elk River (fare at $5 .50)and Ramsey stations is approximately 5 miles. They feel that the fare will be somewhere close to $4.50 per ride but do not want to lock themselves into any fare structure in the future. Keep in mind that while Ramsey is entering into the Transit Taxing District, Elk River is outside of the Metropolitan area and will not be part of the District.
• The last comment that was received by the City Council revolves around the requirement to stop the bus service that is currently operating when the rail service is operational. Since the stoppage of the bus has led to a comment from the Federal Highway Administration (FHWA) about the possibility of repayment of Congestion Mitigation and Air Quality funds, members of the City Council were concerned that the City of Ramsey would be stuck in the middle of two larger agencies telling us completely opposite things. The Metropolitan Council has been extremely helpful in this concern. Staff expects that this issue will be resolved prior to the meeting with evidence of concurrence to be provided at the meeting.

The Master Cooperation, Funding and Delegation Agreement which will be between Metropolitan Council, Anoka County Regional Rail Authority and City of Ramsey covers issues with respect to the implementation, construction, ownership and operation of the proposed project. It also generally defines the scope of the project and delegates the responsible parties as far as cost, construction administration and operation. In this case, the project is generally budgeted at $14.3 million (which does include the skyway connection to the parking ramp) and is defined as:

Right of way from BNSF
Payment to design support, construction, and project management contractors
Staffing costs directly incurred by this project

It also defines the contributions to the project as follows:
 
State              $4.00 million
Met Council    $1.30 million
ACRRA            $1.30 million
CTIB               $3.00 million
City                 $4.75 million

The ACRRA will bid the project, the Metropolitan Council will administer the project and manage the construction and ultimately own and operate the rail station.
 

There will be a Lease Agreement to discuss the parameters of maintenance. All of the stations are owned and operated by the Metropolitan Council except the parking lot adjacent to the Anoka Rail Station. Attached is a copy of the Anoka Lease to give you an idea of the types of issues that that will be discussed.

The Metropolitan Council will be preparing this agreement and it will be presented to the City Council upon receipt. Staff does not feel that the Lease Agreement will be controversial and therefore requests that the condition that was tied to the final approval of the Master Cooperation Agreement be waived. Again the agreement under which the Anoka parking lot, which is owned by the City of Anoka and maintained by the City of Anoka, is attached to this case. It is understood that the City of Ramsey will continue to own and maintain the parking ramp, and anything outside the BNSF right of way. This includes immediate ownership of the skyway connection to the rail station, and any irrigation and landscaping features.

A letter from the Metropolitan Council describing the benefits for entering into the transit taxing district will be sent under separate email as it has not been received at the time of the writing of this case.

A member of the Metropolitan Council will be present at the meeting.

Staff recommends

• approval of the attached Master Cooperation, Funding and Delegation Agreement for the Ramsey Rail Station by waiving the lease agreement condition
• approval of entering into the transit taxing district subject to the review and approval of the City Administrator and City Attorney.

City Funding for the rail station contribution is outlined as follows:
TIF 1 - $650,000
TIF 2 - $4,100,000 (Will need to set up an interfund loan from Landfill Fund for TIF Increment from 2012 & 2013)
This removes TIF funding for the McKinley Street Project near Commercial Asphalt

As it relates to the transit taxing district, there is currently about $40,000 per month ($480,000 per year) that gets spent on the Ramsey Star Express bus service. This money is being generated from the Landfill Trust fund and not the general fund. Entering into the transit taxing district impacts the average Ramsey property owners about $30 annually and generates approximately $295,000 per year.

Maintaining a balance in the Landfill Trust fund, by eliminating the $480,000 per year expenditure for the bus, will allow the City to do a one-time offset of the Municipal Center debt of $300,000 in fiscal year 2013.  This will be when property owners will see their first payment for the transit taxing district reflected on tax statements. This decision will be formalized during the 2013 budget cycle. The projected balance at the end of 2012 is $1.9 million.

Motion to approve the attached Master Cooperation, Funding and Delegation Agreement for the Ramsey Rail Station.

and

Motion to enter into the transit taxing district for fiscal year 2013.