Public Hearing - Adopt Resolution #15-10-254 Adopting Assessment Roll Certifying 2015 Street Maintenance Program Overlay Improvement Assessments; Improvement Project #15-00 Division B

Purpose:
The purpose of this case is to adopt Resolution #15-10-254 adopting the assessment roll certifying 2015 Street Maintenance Program Division B, Overlay Improvements; Improvement Project 15-00.

Background:
The City of Ramsey’s long-term Street Maintenance Program provides for various city streets to receive overlay improvements each year to cost-effectively maximize the life expectancy of street pavement sections throughout the City. Overlaying streets helps to increase the structural integrity of the pavement sections, while also providing some of the benefits received from crackseal and sealcoat improvements.

Division B of the 2015 Street Maintenance Project involved pavement overlays on approximately 3 miles of bituminous surfaced public streets in various locations throughout the City. All of these streets had Pavement and Surface Evaluation Rating (PASER) ratings of 3 or 4 making them ideal candidates for overlays. Attached are final assessment maps A through C which show the locations of the streets that received overlays as part of the 2015 Street Maintenance Program.  Also attached are the final assessment rolls as proposed by staff for Council approval.

Preliminary Assessments
The City’s adopted Special Assessments Policy targets special assessments amounting to 25% of pavement overlay project costs.  The preliminary special assessments were approved at an amount equaling 25% of the estimated pavement overlay project costs. This cost totaled $634,880 and included 10% contingency costs and 25% indirect costs for administrative, engineering, finance, and legal costs.  The assessment rate was therefore preliminarily approved at a flat rate of $1,280 per each of 124 assessable properties having direct access to an improved street, regardless of property location, size, length of frontage, or number of accesses.
 
Public Comment
A Public Information Meeting was conducted for this project on March 18, 2015.  Property owners from 11 of the identified 124 assessable properties attended the meeting.  The general consensus at the meeting was that this work was needed.  Questions received included what the amount of the assessment was, whether the amount would change, whether it was the same for everyone, how lot sizes varied across project areas, whether assessments could be split out by project area, whether sidewalks were being added with this project, and how long access might be restricted.  Any questions not addressed at the meeting were followed up on afterwards by providing additional or updated information via email, by meeting with the property owner at City Hall, or by visiting the property owner on site to discuss their concerns.
 
An Improvement Hearing was held for this project on March 24, 2015.  No comments were received at the hearing.
 

Notice for this hearing was published once in the City’s official newspaper, the Anoka Union Herald, on Friday, September 25^th.  Individual notices of the hearing were also mailed to property owners proposed to be assessed for the improvements.  Attached is a copy of the Assessment Hearing Notice that was mailed to residents on September 25^th, which exceeded the 2 week notice requirement as defined by State statute.
 

Observations:
All proposed work for this project has been completed.  However, the contractor has agreed to repair three small areas that have some surface irregularities.  These areas will be repaired by heating the pavement up and re-rolling it to achieve a smooth surface.
 
Final project costs will be presented in detail at the time Council is requested to approve final payment which is anticipated to occur this year yet, following the repairs to the three areas discussed earlier.
 
Proposed Assessments
The final assessment staff is proposing for this project is $728.90 per assessable property, which is significantly less than the preliminarily approved assessment rate of $1,280 per property.  This is because the final project costs, which are estimated to be $326,547.20 including 25% indirect costs for administration, engineering, finance and legal costs, is substantially less than the original estimated project cost of $634,880.
 
The total number of benefiting assessable properties has also been reduced from 124 to 112.  Following Council approval of the project, several property owners approached Staff with questions about their assessment and upon discussing the project in more detail Staff determined they should not be assessed for this project, primarily due to access locations.  In addition, 3 properties proposed to be assessed in the Northfork development were contested and following further review these properties were removed from the assessment rolls.  Several other properties were removed as a result of changes in project termini that occurred in the field for various reasons.
 
As part of this project the City Council approved the preparation of a special benefit consultation report to verify that the special assessments would not exceed the value to benefited properties.  Based on the consultation report, it is anticipated that properties benefiting from the improvements and proposed to be assessed will be enhanced in value by approximately $1,700 to $13,000 per property.  The higher amount is an outlier.  Two properties on the Northfork Golf Course are anticipated to receive enhanced value of $10,000 and $13,000 each.  When these numbers are removed from the list, the rest of the enhanced values range between $1,700 and $2,200 per single-family residential property.
 
The proposed interest rate for special assessments is 4.16%, and assessments are proposed to carry a 10 year term.  The attached hearing notice includes a schedule of payment showing annual payments including principal and interest.
 
No assessment deferrals have been requested, or are being proposed with this project.
 
Public Comment
At the time this report was written, no additional comments regarding special assessments were received following the March public hearing.
 
Anoka County requires that assessments be certified to the County Auditor by the end of November for collection on next year’s taxes.  This deadline will be met by conducting the Assessment Hearing this evening.
 
Alternatives:
Alternative Action #1 – Motion to adopt Resolution #15-10-254 adopting the assessment roll certifying 2015 Street Maintenance Program Division B, Overlay Improvements; Improvement Project 15-00.

Alternative Action #2 – Motion to deny adoption of Resolution #15-10-254 at this time.
 

This improvement project is included in the City’s 5-year Street Reconstruction and Overlay Plan for years 2015 to 2019, and is proposed to be funded using a combination of street reconstruction and overlay bond funds, and special assessments to benefiting properties as outlined herein.
 

Staff recommends Council approval of alternative action #1.

Approve or deny adoption of Resolution #15-10-254 adopting the assessment roll certifying 2015 Street Maintenance Program Division B, Overlay Improvements; Improvement Project 15-00.