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HomeMy WebLinkAboutCity Council Packet 01-21-1997 Special1997 LEGISLATIVE DINNER JANUARY 21, 1997 5:30 P.M. Public Safety Training Room I. Welcome and Introductions...................................Mayor Tierney II. Legislative Issues Tax Increment Financing Changes................................Dwight Johnson Property Tax Reform ................................................Dwight Johnson Transit...................................................................John Sweeney Property Tax Treatment of Affordable Housing ..............Anne Hurlburt Metropolitan Livable Communities Act .........................Anne Hurlburt Metropolitan Growth Strategies ...................................Anne Hurlburt LocalHousing Preferences ..........................................Anne Hurlburt Residential Speed Limits ............................................Craig Gerdes Community Notification Act........................................Craig Gerdes Strengthening DWI Laws ...........................................Craig Gerdes Local Performance Aid ..............................................Kathy Lueckert III. Open Discussion Twins Stadium Other Issues City of Plymouth 1997 Legislative Issues Tax Increment Financing Recently the TwinWest Chamber of Commerce adopted a position supporting revisions to Tax Increment Financing. The City of Plymouth passed a resolution supporting the TwinWest position, providing that any revisions are not applied retroactively to the existing TIF districts. The City agrees that changes to TIF are needed, but the laws and regulations in place at the time the existing districts were approved should remain in place until the districts expire. The TwinWest position on TIF is attached. Action Requested: Keep the City apprised of legislation changing regulations for Tax Increment Financing districts. Staff Contacts: Dwight Johnson, City Manager, 509-5051 Dale Hahn, Finance Director, 509-5301 Property Tax Reform A number of proposals were introduced in the 1996 Legislative session on this issue. Many of them would have substantially affected the amount of HACA aid the City receives from the state. Continuing uncertainty about property tax reform and state aid was a major topic of discussion by the City Council during our 1997 budget meetings. Long range planning for both operating and capital needs is more difficult with this uncertainty. The City can support property tax reform under certain conditions. Property taxes for some classes of property, including commercial/industrial property and apartments, are too high. Any property tax reform should address the imbalance in property taxes paid in the metro area, as a percentage of income, compared to outstate Minnesota. Tax reform should be judged based upon total impact on Plymouth taxpayers, not just its impact on the City budget. Cities and other jurisdictions need to have time to plan for changes in aid. Finally, property tax reform should consider the totality of how existing property taxes are redistributed away from growth or high value cities. Property tax dollars are redistributed not only through the fiscal disparities program, but also through regional transit tax policies, aid formulas to school districts, state aid to cities formulas, and property tax classification rates. Action Requested: Keep the city apprised of property tax legislation. Staff Contact: Dwight Johnson, City Manager, 509-5051. Transit Plymouth is an "opt out" city. The Metropolitan Council likely will introduce legislation which will change the way transit taxes are calculated in the region. Currently, transit tax is determined by the frequency of the off-peak fixed route service provided in a city. The various levels of tax support based on service frequency are called feathering (We do not know the origins of this phrase.) Plymouth currently is "fully feathered," meaning that the city sees a reduction of .765% of the tax capacity rate for transit services. The Met Council proposal would change the basis of tax feathering to hours of service, including Dial -a -Ride and other para -transit services operating in a city. This change from frequency to hours will have an adverse impact on Plymouth. The city likely will become fully unfeathered (taxed at the highest rate), and the property tax implications are significant: an increase of $300,000 over current tax levels is possible. Attachment I explains the proposed change in more detail. The City opposes any change to the current tax feathering structures. Action Requested: Oppose any change in the current transit tax feathering structures. Keep the City apprised of legislation. Staff Contact: John Sweeney, Assistant Public Works Director, 509-5521. Property Tax Treatment of Affordable Housing Revision of the state's property tax system could affect the HRA's Plymouth Towne Square (PTS) senior housing and other affordable rental housing in the city. The HRA currently makes a payment in lieu of property taxes for PTS under the Municipal Housing and Redevelopment Act, MN Statutes 469. If property tax reform were to change the tax status of HRA property, it could result in higher costs and a higher HRA subsidy for the operation of PTS. Property tax reform that would increase property taxes on subsidized or other affordable rental housing would increase housing costs, reduce the amount of available affordable housing, and make it more difficult to develop additional affordable housing. Action Requested: Keep city apprised of legislation which would impact the property tax treatment of affordable housing such as Plymouth Towne Square. Staff Contacts: Anne Hurlburt, Community Development Director, 509-5401 Ed Goldsmith, Housing Supervisor, 509-5412. 2 Metropolitan Livable Communities Act In response to identified needs in Plymouth and the initiative of the Metropolitan Livable Communities Act, the City has adopted housing goals that will require local, state, and federal resources to accomplish. The amount of resources available does not meet the need. Also, the city would support efforts underway to improve the allocation of MHFA funds by moving away from the approximately 30 categorical programs to more flexible housing grants for local communities. This would allow communities to customize the type of housing assistance that best meets local needs, rather than trying to fit into specific funding categories. Action Requested: Keep city apprised of any proposed legislation on this issues. Staff Contact: Anne Hurlburt, Community Development Director, 509-5401 Ed Goldsmith, Housing Supervisor, 509-5412 Metropolitan Land Planning Act/Metropolitan Growth Strategies Plymouth will be closely monitoring any changes that may be proposed to the Metropolitan Land Planning Act to implement the Metropolitan Council's growth strategy for the metro area. Implementation of the growth strategy will require cooperation between the Met Council and local governments. According to the adopted growth strategy, all of the City of Plymouth will be eligible for inclusion in the Metropolitan Urban Service Area (MUSA) by the year 2020. By 2001, the Met Council will construct the Elm Creek Interceptor across the northwestern corner of the city. In the next two years, Plymouth, like all other metro area cities, will update its Comprehensive Plan to determine how, when, and where expansion of the MUSA might occur. Action Requested: Keep staff apprised of any legislation in this area. Staff Contact: Anne Hurlburt, Community Development Director, 509-5401 Local Housing Preferences The Minnesota Department of Human Rights has made a determination that a housing preference for persons working in a community (such as has been adopted by the Plymouth HRA) is a violation of the state human rights law. State legislation may be necessary to permit such preferences. The Plymouth HRA supports a preference for persons working in Plymouth, because it helps link jobs and affordable housing. Action Requested: Consider introducing legislation to permit local housing preferences, such as those used by the Plymouth HRA. Staff Contact: Anne Hurlburt, Community Development Director, 509-5401 Ed Goldsmith, Housing Supervisor, 509-5412. 3 Residential Speed Limits Concerns about speeding in residential neighborhoods is one of the most consistent issues that Plymouth residents bring to the City Council. The City has tried various approaches to this problem, including additional stop signs, speed humps, increased enforcement, and public education. The City of Plymouth is interested in a reduction of the residential speed limit to 25 mph. The City will be an active supporter of such legislation, and would gladly testify at any hearings. Action Requested: Consider introducing legislation to reduce residential speed limits. Keep city apprised of any legislation introduced regarding residential speed limits. Staff Contact: Craig Gerdes, Public Safety Director, 509-5161 Community Notification of Sexual Offenders Act The City of Plymouth has adopted policies and plans regarding this act, and supports the notification law. Public meetings will be a part of the public notification process for certain offenders. Plymouth area legislators may wish to consider whether or not to attend any such meetings. Action Requested: Keep city apprised of any legislation introduced regarding the Community Notification Act. Staff Contact: Craig Gerdes, Public Safety Director, 509-5161 Enactment of Stricter DWI Laws The City of Plymouth endorses any strengthening of the Minnesota's driving while intoxicated laws. Action Requested: Keep city apprised of any legislation which involving the current DWI statutes. Staff Contact: Craig Gerdes, Public Safety Director, 509-5161. El Local Performance Aid Local Performance Aid (LPA), in which a city or county receives state aid based on the implementation of performance measurement systems, was enacted during 1996. This legislation has ill-defined goals, and establishes no minimum standards for performance measurement systems. Because each community is free to develop its own measurement system, comparing performance and the cost of government among jurisdictions will be difficult at best. The city is not opposed to performance measurements, but is concerned about the lack of state-wide guidelines and the possible unintended consequences of linking measurements to state aid. Action Requested: Support legislation which defines goals and establishes guidelines standards for LPA, or support legislation which returns LPA to general HACA. Staff Contact: Kathy Lueckert, Assistant City Manager, 509-5052. RESOLUTION NO. 96-548 APPROVING THE POSITION OF TWINWEST CHAMBER OF COMMERCE RELATING TO REFORM OF TAX INCREMENT FINANCING LEGISLATION IN THE 1997 LEGISLATURE. Whereas, TwinWest members and City Staff members from its member communities have met several times to establish common ground for the reform of Tax Increment Financing Legislation in the 1997 Legislature; and, Whereas, an agreement has been reached for presentation to the various member City Councils; and, Whereas the agreement would address concerns with the use of Tax Increment Financing such as competition between cities, use of funds for unrelated projects, avoidance of referenda, and use of funds to create unfair competition in the market place; NOW, THEREFORE, BE IT RESOLVED by the Mayor and City Council of the City of Plymouth approve and support the attached TwinWest position on Tax Increment Financing dated September, 1996, provided that it is not applied retroactively to existing Tax Increment Financing districts. Adopted by the Plymouth City Council on October 2, 1996. 11, Agenda Number: TO: Mayor and City Council FROM: Dwight D. Johnson, City Manager Anne W. Hurlburt, Director of Community Development SUBJECT: Support for TwinWest position on Tax Increment Financing Reform DATE: September 23, 1996 1. ACTION REQUESTED: Approve the attached resolution supporting the position of TwinWest Chamber of Commerce on Tax Increment Reform. 2. BACKGROUND: For the last several months, City Managers and other staff members form the eight members cities of the TwinWest Chamber of Commerce have been meeting to determine if common ground could be identified on several tax related issues, including Tax Increment Financing Reform. For TwinWest, the perception that business benefits from corporate welfare legislation such as Tax Increment Financing has weakened their efforts in lobbying for major property tax reforms. For the cities, it is apparent that some cities use TIF to compete with other area cities and that some cities do seem to be avoiding referenda on such items as ice arenas and community centers by using TIF. Also, reform of TIF seems to be a strong possibility in the 1997 legislature. The cities might benefit from a proactive proposal rather than simply defending the current laws. The staffs of most of the member cities have agreed upon a proposal to address these concerns without weakening the use of TIF for its original core purposes such as redevelopment and housing diversity. 3. ALTERNATIVES: The City can either approve, disapprove of the position, or request modifications. 4. DISCUSSION: The League of Minnesota Cities will not likely approve of the attached resolution. They have spent years lobbying to retain as much of current TIF law as possible. Likewise, the State Chamber of Commerce may not approve because many smaller outstate communities believe they must use TIF to compete for economic development. But both Twin v.'est and its member city staffs agree that the issue is too important to ignore and that creative, knowledgeable, reform is required. 7 In recent years, Plymouth has been one of the cities to seriously attempt to meet the "but for" test which requires the City to find that the development would not have occurred but for TIF assistance. We have made a number of prospective developers angry because we have been making a good faith effort to follow the law. In addition, we have chosen to be accountable to the voters and have major projects such as Open Space/Trails and the Ice Arena project voted upon by the voters, whereas other communities have not. We have also had some businesses depart from Plymouth due to TIF incentives in neighboring communities that are not within the intent of the original law. Most of the problems result from use or misuse of a particular form of TIF district known as an Economic Development District, and the TwinWest position would abolish this form of TIF. The other provisions would address some of the questionable uses of TIF more directly. Finally, TwinWest seeks a provision to assure that TIF is not used to give one business a competitive advantage over another, with which the city staff members agree. 5. BUDGET E%VACT: There will be no impact on the General Fund, since TIF proceeds have been kept in separate funds. In addition, Plymouth has not retained any TIF proceeds for its own expenses, other than normal administrative expenses, since 1990. During the 1980's however, it was normal for the City to create TIF districts not to assist development directly, but rather to accrue funds for pending major highway projects. However, legislation was subsequently changed for districts created after 1990 to restrict pooling of money for such projects. Therefore there will be no new impact on the City. 6. RECOXE%UNDATION: Staff has come to believe that Economic Development TIF districts may have caused more harm to the City during the last few years than good. More businesses have been lost to the City through aggressive competition between cities than have been gained by our very occasional and responsible use of such districts. Further, if cities don't lead the way in reforming TIF, the Legislature will reform it in a less knowledgeable and constructive manner. Staff therefore recommends approval of the TwinWest policy, provided it is clear that it is not a retroactive policy to be applied to existing TIF districts. Many cities, including Plymouth, have made too many long range plans that have relied upon previous laws. IN 11 TW 1 N\/VEST CHAMBER OF COM M E R C E September 19, 1996 Dwight Johnson City Hall 3400 Plymouth Boulevard Plymouth, MN 55447 Dear Dwight: w SLP 2,3 Enclosed you will find a copy of the TwinWest Chamber's draft position regarding improvements to TIF. This position was the cooperative result of a series of meetings between local city managers, business representatives and TwinWest staff. Please circulate the document to your respective city council members for review, comments and potential endorsement at your next convenient workshop or regular council meeting. Additionally, I have also enclosed 3 copies of our Practical Politics Series brochure. Our objective is to procure one participant from each of our member cities. If you know of any staff, council or commission members that may have an interest in this fine program please pass the brochure along. I will contact you near the end of next week toeg t an update on the status of the draft and potential Practical Politics Series participants. If you have questions, comments or concerns please contact me at 540 - 0234. Thank you for your effort and cooperation. Sincerely, Bill Pulkrabek Director of Government Affairs Enclosures (4) T W I" \/\/ E S -T- CC H A M B E R OF CO M ME R C E September, 1996 TWINWEST CHAMBER OF COMMERCE Tax Increment Finance Reform Position Obiective: Improvement of current TIF laws to (1) restore original legislative policy goals, and (2) promote a healthier, more competitive business climate. Chamber Position: The TwinWest Chamber of Commerce supports the following revisions to current TIF statutes: 1. Abolition of the Economic Development District as a qualifying TIF district. 2. Return of TIF development projects to general tax rolls immediately after all direct costs of the development are recovered by the city. 3. Prohibition of the use of TIF reserves generated on one project for use on unrelated, subsequent projects. Phased developments would be permitted to use TIF reserves to seed subsequent phases, with the requirement that such subsequent phases be a part of the original TIF project planning process. 4. Prohibition of the use of TIF district funding for certain public facilities (other than infrastructure improvements extending public services to a project), including as examples the construction, addition to or improvements of community centers, government centers, parks, golf courses, ice arenas, recreational facilities, and other capital projects the funding of which are typically subject to public referenda. 5. Creation of specific findings of fact, as a result of local notice and hearing processes, by which municipalities assure that TIF projects under consideration will comply with the "but for" test. Included in this process will be a required finding that no competitive advantage is created by subsidization of a project. Allowed subsidization is only that amount necessary to bring a project to existing market conditions. The notice, hearing and findings of fact process would create a legal standard subject to judicial challenge, upon the posting of sufficient security by any party challenging the process. 10550 WAYZATA BOULEVARD MINNETONKA, MINNESOTA 55305 (612) 540-0234 Crystal, Golden Valley, Hopkins, Medicine Lake, Minnetonka, New Hope, Plymouth, St. Louis Park l6 O 01 Y ^ O CO Yl N O ^ n O t'1 t7 N N m O 01 N n O m n Nf N O O O O ep C p N L{ M O t0 n O O O b O N Y n a0 fV e7 A '- •- N N N N m M If f .- N N N N N N N N M N N N N N N N M N N W 1 hn o. n p o p Q: 0. N S ? 1% r aN0 d OO 11 f Q Oi A f O O aD In 01 .A O Pl 10 f N4G011 10 b 1 Q/ n en N cnapp P ^ O QQ11 r A N N N N M N ! 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ON1NNNl'1 f N p p pp p pA LL V h ^ N N h v1 h h N h O h ^ ^ ^ ^ ON !'1 Y N b n aD Ql H N N N N N N N N N N N N N N 0' d 100' ON VS: OT 96 02 130 : X31 DATE: January 6, 1997 TO: Dwight D. Johnson, City Manager through' Fred G. Moore, Director of Public Works FROM: John R. Sweeney, Transit Administrator ' SUBJECT: PROPOSED MET COUNCIL LEGISLATIVE INITIATIVE PERTAINING TO TAX FEATHERING CHANGES It has come to my attention that the Metropolitan Council will be carrying an initiative to the 1997 Legislature that would change the way tax feathering is calculated in the region. This proposed initiative, if enacted, could have a tax implication to the City of Plymouth. Currently, feathering is determined by the frequency of off-peak fixed route service provided in any given city. If the off-peak fixed route operates with a frequency of once per hour or more often, the City is fully unfeathered (taxed at the highest rate). If the service operates with a frequency of less often than once per hour, the City will be partially unfeathered "a reduction of .510 % of the tax capacity rate. " If there is no off-peak regular route service, the City is fully feathered (a reduction of .765 % of the tax capacity rate). The proposed new initiative would be based on hours of service, including (for the first time) Dial A Ride and other Paratransit services operating within the city. Previously, Dial A Ride and Paratransit services were excluded from feathering consideration because they are not fixed route services. Metro Mobility service within a city will not be part of the feathering determination because the funding for Metro Mobility comes from State Aid and not from the property tax. The hours of service proposal per a conversation with Mark Fuhrmann, Metropolitan Council staff, will be based on schedule hours, not vehicle hours. For example, Plymouth operates Dial A Ride for 12 hours per day Monday through Friday, but runs four Dial A Ride vehicles during these operating hours. Mark Fuhrmann was asked directly, "In this case, does this at G AENG\TRANSIT\M EMOS\FEATHER. DOC SUBJECT: PROPOSED MET COUNCIL LEGISLATIVE INITIATIVE PERTAINING TO FEATHERING CHANGES Page 2 translate to 12 hours per day (schedule hours) or to 48 hours per day (vehicle hours)?" Mark's answer was that they are talking about schedule hours only. Plymouth currently operates 68 hours of Dial A Ride service per week (12 hours per day Monday through Friday and 8 hours daily on Saturday) and 70 hours of circulator service (7 hours per day for each of the 90A and 9013, Monday through Friday). This totals 138 hours of service per week putting Plymouth into the fully unfeathered category under this proposal. Even if the circulator would be considered as one route (unlikely) with a total of 35 hours per week of service, there would still be 103 hours of service per week in Plymouth. The current proposal being considered by the Metropolitan Council is based on the following thresholds: Less than 50 service hours per week (no change). 50 - 100 service hours per week (partial unfeathering). More than 100 service hours per week (full unfeathering). If peak hour Dial A Ride service is deducted, it still leaves 6.5 hours per day Monday through Friday, and 8 hours on Saturday (there is no "peak" on Saturday) or 40.5 hours per week. This added to the 70 hours of circulator service still results in 110.5 hours per week, enough to result in fully unfeathering Plymouth. The partial unfeathering that will impact Plymouth as a result of implementing the circulator is estimated to generate approximately $150,000. Fully unfeathering Plymouth would result in a tax increase of approximately $450,000, or $300,000 more than previously assumed if the proposed Met Council Legislation is enacted. It should be noted that eliminating the Circulator in order to qualify for the partial unfeathering rate would have an unwanted impact. Eligibility for Metro Mobility service will continue to be based on off-peak fixed route service and eliminating the Circulator will place Plymouth in the unpleasant position of being partially unfeathered due to the existing Dial A Ride service, and still not be eligible for Metro Mobility service. At the present time, the status of feathering in the 12 "Opt -Out" communities is as follows: Plymouth - fully feathered Maple Grove - fully feathered Prior Lake - fully feathered Shakopee - fully feathered Chanhassen - partially feathered Chaska - partially feathered Rosemount - partially feathered Savage - partially feathered GAENGURANSInMEMOS\FEATHER. DOC 13 SUBJECT: PROPOSED MET COUNCIL LEGISLATIVE INITIATIVE PERTAINING TO FEATHERING CHANGES Page 3 Eagan - fully unfeathered Apple Valley - fully unfeathered Burnsville - fully unfeathered Eden Prairie - fully unfeathered At the present time, I am not sure how this proposed legislative initiative would impact the other communities, so I am not sure what role, if any, the Suburban Transit Association (STA) should have in the overall process. The purpose of this memo at this time is to make you aware of the proposal and after additional information is obtained, perhaps we can get our heads together and figure out exactly what we should be doing so that Plymouth's best interests are served. cc: Mayor Joy Tierney GAENMTRANSInMEMOS\FEATHER. DOC COMMUNITY NOTIFICATION AND REGISTRATION ACT In 1996, the Minnesota State Legislature passed the Community Notification Act and the Registration Act. This legislation will take effect on January 1, 1997. The Community Notification Act and the Registration Act have made it possible for law enforcement agencies to release certain information to the public that was formerly classified as private data. Notification is guided by state statute and carried out by the policy of the law enforcement agency, when it is deemed that the release of information will enhance public safety and protection. Sex offenders have always lived in our communities; but it was not until the passage of the Community Notification Act and the Registration Act that law enforcement agencies were informed of where they were living. Although, this legislation will not apply to all persons who are sexual offenders, it will enable law enforcement to be able to locate and be aware of activities of many of these individuals. The intent of the Community Notification Act and the Registration Act is to create an informed community, one that has developed constructive plans to prepare themselves and their children for the offender's release. The intent is not to increase fear. We believe that an informed community is a safer community. Abuse of released information to threaten, intimidate or harass registered offenders will not be tolerated and may itself constitute a criminal act punishable by law. Such abuse could potentially revoke law enforcement's ability to share information with the community. Sex offenders derive their power through secrecy. Repeal of this legislation would again enable sex offenders to maintain their anonynity. Prior to a sex offeder's release, a committee of experts will meet to discuss the public risk posed by the offender. The offender will be assigned one of three risk levels which reflects his or her potential to re -offend: Level 1 Low Risk; Level 2 Moderate Risk; or Level 3 High Risk. Information about the offender, including their risk level will be sent by the Department of Corrections to the law enforcement agency having primary jurisdiction over the area in which the offender plans to reside. Again, the scope of law enforcement's disclosure of this information is limited by state stature and determined by the classificaion level of the offender. In many cases, law enforcement will not legally be able to share information with the public. LEVEL I: LOW RISK Law enforcement may notify: Other law enforcement agencies Any victim(s) of or witness(es) to the offense committed by the offender LEVEL II: MODERATE RISK Law enforcement may notify: Level I notifications Schools and daycares Establishments and organizations that primarily serve individuals likely to be victimized by the offender LEVEL III: HIGH RISK Law enforcement may notify: Level I and II notifications Other members of the community whom the offender is likely to encounter, i.e. Neighborhood Watch Groups, Churches, apartment communities, etc. How can you assist us with this program? We encourage you to form a Neighborhood Watch Group in your neighborhood. It is one of the most successful ways we have to communicate with you. For more information on the Sex Offender Community Notification Act and the Registration Act, please call the Investigative Division at 509-5192. If you are interested in learning more about the Plymouth Police Department's Crime Prevention Programs, please call 509-5198. i _ The Plymouth Police Department, 3400 Plymouth Boulevard, Plymouth, MN 55447