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Full house at Lanesboro assessment hearing

Fri, May 2nd, 2008
Posted in Government

There was a full house at the Community Center when Lanesboro held a Preliminary Assessment Hearing for upcoming street repairs on Monday,April 28. Many residents who live on both Whittier Street and Maple Drive showed up to ask questions and express their concerns about the projects and the financing.

City Attorney Tom Manion began by stating that the purpose of the meeting is to give the city an opportunity to explain the Capital Improvement Projects on the two streets, as well as how the city came up with the assessment numbers. He added that according to state law, the city cannot assess a property owner more than the amount that their property's value would increase from the project.

Dillon Dombrovski of Yaggy Colby described the two projects to the audience. The Maple Drive addition is fairly new to Lanesboro, as some homes on it were built from six to eight years ago. At the time of construction, the road was not paved and there was no curb and gutter put in. The project this summer will include paving the road, adding curb and gutter and tying it in with the storm sewer system.

Whittier Street, going from Parkway to Auburn, will be larger project. There will be a total reconstruction of the road, water main, pavement, new curb and gutter, storm sewer and catch basins included.

Dombrovski explained that according to the new assessment policy adopted by the city, new improvements, or new construction of roads, will be assessed 100 percent to the property owners. Since Maple Drive does not have an existing paved road, it qualifies as a new construction. Reconstruction, or repair to existing streets, will be assessed at 25 percent. According to Dombrovski, this is right in line with surrounding communities.

He also went over the timeline for the project. After the city approves going ahead with everything, engineers will have to do surveys and topography of the areas, which will take about six weeks. In June, they could have the final design on the project. At that time, the projects will be advertised for three weeks and bids will be received from contractors. There will then be a neighborhood meeting to show the residents the final design of the project and discuss things like shutting water off temporarily and getting in and out of driveways and other problems. Construction could then begin in late July or early August, and be completed around the middle of October.

Mike Bubany of David Drown Associates explained the financial aspect of the project. The cost of the Whittier Street project for the residents comes out to about $55 per foot. Bubany said that Dodge Center recently assessed a project that came to $148 a foot. It was then contested by the residents, and the city brought it down to $55 a foot.

With Maple Drive being assessed at 100 percent, the cost to the residents is $67.11 a foot, or approximately $6,000 each.

The cost can be paid off over fifteen years at 5.5 percent interest rate, and added to property taxes. The property owner can pay it off in full at any time without penalty. Bubany explained that the total paid per year comes to about 10 percent of the total assessed amount.

Bubany also talked about the tax rate in Lanesboro, and how the goal of the city was to keep the rate right around 71 percent. The only way to do that is to do special assessments, and to do the needed construction in phases, so that when the debt is paid off for this one, there will be money available to do the next phase. He also mentioned that this is a favorable building environment for projects like these, with historic low interest rates.

"Bids have been coming in a lot below the estimates," said Bubany.

Cecilia Allen, who lives on Maple Drive, had some concerns about being assessed at 100 percent.

"I've been living there for six years," she said. "It doesn't feel like a new subdivision anymore. It doesn't seem fair to make us pay 100 percent. We should all be assessed the same."

Allen also expressed that she and other residents on Maple Drive thought they would be getting blacktop long before now, and had been asking for it for years. Another resident said that since he had been paying taxes on his property for eight years, he felt that the city should pitch in a little with the costs.

Bubany said that although he did not personally think it was a good idea, it was up to the city to determine the percentage assessed. "If the city does pay some of it, you need to be very clear that this was special circumstances, since the city didn't require it to be done right away."

City Administrator Bobbie Vickerman clarified that the new assessment policy requires that new developments have blacktop, curb and gutter completed.

Bob Thompson, who lives on Whittier Street, asked the council if they had considered the cost of burying electric power lines there, since the street will be torn up. Vickerman said she had looked into the cost, and it was estimated around $100-175,000. Thompson asked how much the assessments would change with that project added, and Vickerman told him that it was up to the Public Utilities Commission to take care of the power lines, and it was not an assessable project.

Thompson also expressed his belief that the city should take care of all of the streets in the Brooklyn area, bond for them and have the city residents pay for the repairs in their taxes, as the streets are all falling apart in that area.

Bubany said there is a limit to how much debt a city can have in bonds, and for Lanesboro it would be $1.5 million. He figured out the tax rate if the city was to go ahead with that idea, and the rates went off the chart. "I'm guessing that this would not be feasible," he said.

Another resident asked if the value was going up on her home the same amount that she was being assessed, did that mean that her property taxes would also go up because of that?

Bubany explained that the county assessor doesn't raise taxable value on a property due to street repairs. Council member Tom Dybing added that the value goes up on a house based on sales in the area that are comparable to your property, so the taxable market value would not increase.

"You have to understand that this is not easy for the city council," said Mayor Steve Rahn. "We're trying to do this as fairly as we can. We haven't done any big projects for a long time. We'd like to keep the tax rates fairly stable, and this is the only way we can."

Vickerman said the next Public Utilities meeting is May 20, and she would get an estimate for burying power lines on Whittier and present the idea to them.

The council passed a resolution to go ahead with the projects. They will further discuss the assessment percentages next month. Another public hearing will be held in the fall when they have the exact numbers, and at that time residents may challenge the assessments.

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