Developer Andy Bunge requested the Park Lane agreements with Winslow and Sackett for future Park Lane development be assigned to him at the Preston City Council’s April 17 meeting. The EDA recommended approval.
The development agreement was originally signed in 2020, and since, has been extended through August 2023. City Administrator Ryan Throckmorton said the reassignment of the agreement is an option provided in the agreement language.
Mayor Kurt Reicks said this is the best way to go, to have a developer work on it. The city is not in that business. Throckmorton said with a reassignment to Bunge, it will be up to him to petition Planning and Zoning to rezone the properties from R-2 to R-3 to allow for multi-family unit dwellings.
Throckmorton noted the city has invested approximately $1,500 to this point in Park Lane development, a relatively small investment by the city. The city was to be the purchaser in the original agreement. A motion to approve the transfer of the option agreement for Park Lane development to Andy Bunge was approved unanimously.
Jason Boynton, Smith Schafer & Associates, LTD., reviewed Preston’s 2022 audit. The city was given an unmodified “clean” opinion on 2022 financial statements. The general tax levy revenues represented 40% of total governmental revenues. Local government aid (LGA) represented 19% of the 2022 governmental revenues. LGA has been relatively constant over the last 10 years. Costs do continue to go up, requiring increases in the tax levy to cover those costs.
The unassigned general fund balance, or reserves are about 60% of general fund expenditures. The reserve for capital improvements has a fund balance of $566,822 to finance capital needs. All outstanding bonds are being paid on a timely basis. Fire department and reserve funds for equipment have a positive balance of $715,550. Electric, water and sewer funds are able to meet annual debt service and provide reserves for future capital improvements.
The 2022 audit was approved as presented.
Other business in brief
• Stantec received two quotes for the seal coating of streets constructed in 2014-2015. The lower quote from Pearson Brothers in the amount of $76,010 was accepted for the 2023 seal coating project as recommended by staff. Seal coating is used to prolong the life of streets; it is preventative maintenance against cracking and potholes.
• Peggy Bjortomt and Mary Reisner were hired as seasonal part-time employees for the visitor’s center as recommended by the Tourism Board.
• The lower quote from Bowmans for city hall window replacement in the amount of $26,705.90 was approved. There is a one-year warranty for workmanship, 10-year warranty on glass, and two-year warranty on aluminum finish. The warranties were the same on both submitted quotes.
• A letter of support was approved asking the state legislature to remove income requirements for TIF districts outside of the metro region as recommended by Southeast Minnesota League of Municipalities (SEMLM).
• A letter of support requesting state funding in the amount of $350,000 in 2024 for a Transport Management Organization study of the transport needs in the southeast Minnesota region was approved, as recommended by SEMLM.
• The city council will meet next on May 1.
Local Board of Appeal & Equalization
County Assessor Jason McCaslin gave an overview of changes administered for the 2023 assessment. The assessor’s office is required to maintain the median sale ratio at a compliant level (90%-105%). Preston city had a compliant ratio at 92.9%. When the Price Related Differential (PRD) was applied the median ratio increased to 96.20%. McCaslin noted no further adjustments were necessary. With application of the PRD, newer homes saw in increase and older homes generally saw a decrease.
Two properties were recommended for adjustment. The owner of the first at 104 Valley St. SE requested a reassessment. Due to the fact that work in the home was only 81% complete, a decrease in value was recommended from $119,000 to $81,000. The board voted to accept the recommended decrease in value.
The owner of a second property at 120 Overlook Ln. NW had asked for a reassessment. The recommendation due to a square footage adjustment was to reduce the value from $633,800 to $631,000. The owners were present and argued that their valuation had increased 69% in four years. The owners had successfully gotten a valuation decrease on appeal in 2021. The appraiser said the valuation increase over four years was partly due to the initial adjustment made by the board in 2021. He said the valuation was established by a $175-per-square-foot price that is within reason for the market here. McCaslin said while working to get the Coefficient of Dispersion in compliance, the large increase is not unrealistic. Some properties were over assessed, others under assessed.
Throckmorton said the tax base is driven higher on residential properties as commercial property values have plateaued. Councilman Steve Hall said he was not comfortable saying yes or no on the information just presented to the council.
The valuation adjustment recommended by the assessor, the valuation decrease of $2,800 was approved. Hall voted no. The owner can appeal further to the county Board of Appeal and Equalization in early summer.