HomeMy WebLinkAboutCity Council Packet 06-19-1995 SpecialPLYMOUTH CITY COUNCIL
SPECIAL COUNCIL MEETING
MONDAY, JUNE 199, 1995
7:00 P.M.
City Council Chambers
I. Joint meeting with Planning Commission
to discuss Downtown Plymouth planning efforts
II. City Computer System
M. Private Streets
DATE: June 15, 1995
TO: Mayor and City Council
FROM: Kathy Lueckert, Assistant City Manager
SUBJECT: Special Council Meeting --Downtown Plymouth
The Downtown Plymouth consultant is still finalizing their report and presentation for
Monday evening. Thus there is no staff report for this item this afternoon.
440
as ociation of
me ropo itan
municipalities
BULLETIN
DATE: June 14, 1995
TO: Mayors, Managers/Administrators, Legislative Contacts
FROM: Vern Peterson, Roger Peterson, Cheryl Budewitz
RE: 1995 Legislative Summary
Enclosed is a Policy Narrative and Policy Success Report which provide a summary wrap-
up of the 1995 Legislative Session and the issues affecting AMM cities.
Approximately two-thirds of all AMM policy was either fully or partially accomplished
during the session. Of the 64 total AMM action policies:
33 were passed or upheld fully (52%);
8 were partially accomplished (13%);
17 were not discussed or the issue did not pass the fust committee (27%);
6 failed (9%).
3
V
3490 lexington avenue north, st. paul, minnesota 55126 (612) 490-3301
to*
association of
metropolitan
municipalities
1995 Legislative Session
CONTENTS
I. METROPOLITAN LIVABLE COMMUNITIES ACT ........................................ 1
Tax Base Revitalization Fund (1)
Livable Communities Demonstration Account (1)
Local Housing Incentives Account (3)
Met Council Reports (4)
Miscellaneous Provisions (4)
II. OMNIBUS TAX BELL.......................................................................................... 4
Local Government Aid & Homestead Credit Aid (4)
Aid Distribution & Service Delivery Study (4)
Board of Government Innovation (S)
Class Rate Change (S)
Transit Zone CII Tax Rate - Metro Area (S)
Property Tax Refund as Deduction on Tax Statement (6)
III. TAX INCREMENT FINANCING (TIF)*.......................................................... 6
LGA/HACA Penalty Option (6)
Soils Condition District (7)
Hazardous Substance Subdistrict (7)
Pooling (8)
But For Test (8)
Annual Disclosure - Reporting & Enforcement (8)
Clean-up Cost Recovery - Extension of District (9)
Economic Development Districts (9)
Parcels not Included in Districts (9)
Special Laws (10)
IV. TRANSPORTATION.........................................................................................10
Highways (10)
Transit (10)
Noise Regulations (10)
V. METROPOLITAN LAND PLANNING ACT .................................................... 11
VI. ZONING ISSUES - PROCESS TIME...............................................................12
VII. 800 MHz RADIO SYSTEM..............................................................................13
VIII. ECONOMIC DEVELOPMENT & HOUSING FINANCE* ......................... 14
Development of Trade/Economic Development (DTED): Budget (14)
Department of Economic Security: Budget (15)
Minnesota Housing Finance Agency (MHFA): Budget (15)
IX. ISSUES NOT PASSED IN 1995........................................................................16
Housing as a Regional System (16)
Codification of Regional Blueprint (16)
Land Stewardship Land Use Planning Bill (16)
Direct Election of Met Council Members (16)
Property Tax Rate Freeze (16)
Municipal Bond Interest Taxation (17)
Beg for Your LGA/HACA (17)
School Property Tax Constitutional Amendment (17)
Municipal Tort Liability Increase (17)
Gas Tax & Transit Funding (17)
Special thanks to Publicorp, Inc., for its summary contributions.
1) METROPOLITAN LIVABLE COMMUNITIES ACT
S.F.1019, Laws 1995, Chapter 255)
This act establishes the Metropolitan Livable Communities Fund under the jurisdiction of
the Metropolitan Council. Under the act, three separate accounts or programs are
established with each account having specific purposes and specific revenue sources.
Please see graphic on page 2)
City participation is voluntary. However, if a city does not participate in the Local
Housing Incentives Account, it is not eligible for funds from the three accounts or the
pollution clean-up fund, which is administered by the Department of Trade and Economic
Development (I)TED).
The Met Council will establish criteria and guidelines for the Livable Communities Fund
and the grants and loans process, as well as an annual plan for distribution of the funds and
an annual usage report.
Tax Base Revitalization Fund
Grants for polluted land clean-up will be issued in the metro area. The Met Council will
set priorities for the use of the funds if there are a great number of requests. Grants will
be awarded for qualified sites that provide the highest return in public benefits. No more
than half of the funds can go to a single city and no more than 75 percent to projects in
fust -class cities. Cities may use the grants for the local match requirements for projects
funded under the DTED contamination clean-up grant program. The local match payment
is reduced to 12 percent (was 18 percent) of the clean-up costs.
Livable Communities Demonstration Account
The Met Council may levy a property tax equal to 50 percent of the Metropolitan
Mosquito Control District (MMCD) levy for taxes payable in 1995, indexed for market
growth. The account will receive an annual HACA payment equal to 50 percent of the
current MMCD HACA payment.
Grants and loans will be provided to participating cities for projects that meet specific
guidelines. The projects should:
Interrelate development or redevelopment and transit;
Interrelate affordable housing and employment opportunities;
Interrelate development or redevelopment that mixes incomes of residents;
Intensify land use that leads to more compact development;
Encourage public infrastructure investments which connect urban neighborhoods and
suburban communities, as well as provide project area residents with opportunities for
private sector employment.
1995 Policy Narrative
s
Metropolitan Livable Communities Fund
Tax Base
Revitalization Account
Revenue Source
Right of Way
Acquisition Fund
Mega Mall fiscal
disparities surcharge
Approx. $5-7 million
per year
Purpose:
Polluted land clean-
up for C-1
redevlopment
Eligible applicants:
Counties
Cities participating
in incentive account
Livable Communities
Demonstration Account
Revenue Source
HACA payment equal
to 50% of MMCD
payment
Mosquito Control
District levy (50%)
Approx. $4.5 million
per year for grants)
loans
Purpose:
Develop incentives to
implement Council's
policies and act
Eligible apvlicants:
Participating cities
Local Housing
Incentive Account
Revenue Source
Local tax levy based
on portion of home
stead base
Council bond
proceeds and levy
1.5 million per year
in matching grants
Purpose:
Expand affordable
housing in cities
Cities negotiate with
Council for housing
goals
2 1995 Policy Narrative
Local Housing Incentives Account
A city has until November 15 of each year to decide to participate or not. If a city does
elect to participate, it is eligible to receive grants and loans for pollution clean-up and
demonstration projects, as well as matching funds from the local housing incentives
account. The Met Council may give consideration to a city's participation in the local
housing incentives program when making discretionary funding decisions. The following
is an outline of the process once a city opts to participate:
1) January 15, 1996. City negotiates affordable and lifecycle housing goals
2) July 1, 1996. City develops an action plan.
3) July 1 of each year. County calculates municipality market value base amount and
funds available for the local housing incentives account.
4) Met Council notifies city of its affordable and life -cycle housing opportunities amount.
The amount is the lesser of the following:
Four percent of the residential homestead value x local tax rate;
Residential homestead value in excess of the market value base amount (2 times
average) x local tax rate.
5) City uses local funds and available Met Council funds to meet its goals.
6) If a city has not met its goal and not spent 85 percent of its affordable and life cycle
housing opportunities amount in the previous year by 1998, it may:
Distribute the funds to the Met Council to put in the local initiatives account;
Distribute the funds to the city or county HRA to create housing opportunities;
City may join together with adjacent cities to provide housing opportunities.
Cities must match the Met Council funds dollar -by -dollar. The Met Council must give
priority to cities that:
Receive less from fiscal disparities than it contributes by more than $200 per
household;
Demonstrate that the project will link jobs to housing;
Provide matching funds from sources other than the affordable and life -cycle
opportunities amount.
If a city elects not to participate for some years, but then elects to participate, the
municipality must establish what it agrees to spend on affordable and life -cycle housing, or
agree to distribute to the local housing incentives account.
1995 Policy Narrative 3
This amount is equivalent to what it would have spent on affordable and life -cycle housing
had goals been established under this section for the period in which it was not
participating. The Met Council will determine which investments count toward the
required cumulative amount by comparing the municipality to participating municipalities
similar in terms of stage of development and demographics.
Met Council Reports
The Met Council must file an annual report with the Legislature outlining the participating
and non -participating cities, as well as an annual comprehensive report card on affordable
and life -cycle housing in the metro area by city. In addition, a report must be filed with
the Legislature by Jan. 15, 2003 which includes the funds accounts and how they were
used. Another report must be filed by Jan 15, 1996 describing the probable development
patterns in the metro area by the year 2020.
Miscellaneous Provisions
The starting time for the city of Bloomington to begin repaying the fiscal disparities pool
for interest on highway bonds sold in conjunction with the Mall of America is delayed.
Also, the 1:1 housing replacement of low income housing for first-class cities is repealed
An urban homesteading program is established to encourage higher income persons to buy
homes in areas that are in transition toward blight and poverty. Income tax benefits will
also be provided to eligible persons.
II) OMNIBUS TAX BILL
HY.1864, Laws 1995, Chapter 264)
Local Government Aid/Homestead Credit Aid (Article 8, Section 15)
Homestead and Agricultural Credit Aid (HACA) was reduced by $16 million in 1996 for
cities, counties, towns and special districts. The city share of the reduction is slightly less
than $8 million.
The cut is for 1996 only and the HACA will be restored in 1997 unless the Legislature
acts next year to make the cut permanent. The reduction is limited within individual cities
to .45% of the 1995 net tax capacity, which will benefit a few very property -poor cities.
Aid Distribution and Service Delivery Study (Article 8, Section 22)
The Legislative Commission on Planning and Fiscal Policy is directed to establish a
subcommittee by July 1, 1995 to study:
1) Alternative methods of distributing general-purpose aids to units of local government.
2) Approaches to maximizing the efficiency and effectiveness of local government and
Cities and counties shall provide information and analysis as requested within 60 days of
the request. If the city or county fails to comply, the subcommittee may recommend that
the Legislature impose a financial penalty.
The subcommittee report is due Feb. 1, 1996 and will make recommendations for reform
in aid distribution and government service delivery systems.
Ironically, this provision creates an unfunded mandate with the threat of a penalty to
supply unspecified data and analysis. Whereas Sections 2 and 23 create a major study of
unfunded mandates and their necessity!
Board of Government Innovation (Article 8, Sections 2 & 23)
Of the HACA cut, $2 million is allocated for the Board of Government Innovation and
Cooperation for 1996 and 1997. Fifty percent of the funds go for aids to cooperating and
combining local government units. The remainder is for general grants. A number of
changes were made to the application and grant process to ensure that grant funds are
needed and not merely replacements for another existing resource.
Finally, the board is directed to do a major assessment and study of unfunded state
mandates, their impact, inconsistencies or contradictions and relevancy. A report with
recommendations is due Jan. 15, 1996.
Class Rate Change (Article 3, Section 10)
Three property class rates were changed. They will have a small impact and will only
create minor property tax shifts:
1) Seasonal Recreation Property - Non-commercial: For taxable value under $72,000,
the rate changes from 2% to 1.9% for taxes payable in 1997 and 1.8% in 1998. The value
in excess of $72,000 remains at 2.5%.
2) Manufactured Home Parks: The class rate will remain at 2% for 1996 and thereafter,
rather than increasing to 2.3%.
3) Certain Apartment Property: Class rates for apartments in cities with populations of
less than 5000 that are outside the seven -county metro area or the nine contiguous
counties and that are more than 15 miles from a city with a population over 5000, will be
reduced to 2.3% from 3.4% for taxes payable in 1996 and thereafter.
Transit Zone C/I Tax Rate - Metro Area (Article 3, Sections 9 & 27)
Provides that a transit zone is the area within one-quarter mile of a bus route which has
certain specified hours of service within the metro urban service area. If construction
funds are committed to a light rail transit route, that route shall be considered to be a
transit zone.
Also provides that the Met Council is responsible for maintaining a detailed map of transit
zones and providing the map.to all assessors in the metro area. The initial maps will be
produced by Jan. 1, 1996.
Any class 3A commercial/industrial structure, constructed under an initial building permit
issued after Jan. 2, 1996, located in a transit zone and within a school district, and not
primarily used for retail or transient lodging purposes, shall have a four percent class rate
on its market value in excess of $100,000. (The current class rate on that property is
4.6%.) The four percent rate shall also apply to any new improvements added under an
initial building permit issued after Jan. 2, 1996, to an existing qualified
commercial/industrial structure located in a transit zone. These changes are effective for
the 1997 assessment, taxes payable in 1998.
Property Tax Refund as Deduction on Tax Statement (Article 4)
The regular circuit breaker and special targeting property tax refunds for homeowners will
be deducted on the taxation notices. Money will be paid by the state directly to county
treasurers and be a permanent open appropriation. 1998 is the first year of the new
payment method, with 1997 as a transition year.
III) TAX INCREMENT FINANCING (TIF)
HY.1864, Laws 1995, Chapter 264)
The Omnibus Tax bill includes an economic development article (Article 5) that contains
several TIF amendments. The amendments include:
LGA & HACA Penalty Option
A major issue surrounding the legislative TIF discussion has been the issue of local
accountability. The imposition of the LGA/HACA penalty has been viewed as a means to
illustrate local and state financial impacts of TIF. The Legislature has been reluctant to
grant exemptions from LGA/HACA without imposing such measures as a local share, a
housing development requirement or county board approval of district. The 1995
Legislature adopted a provision that permits a city to choose to pay a local share for a
portion of the district costs. The details of the local share are the following:
The amount of the local contribution must be made out of unrestricted money (general
fund, tax levy, or a federal or a state grant of authority or municipality);
The local contribution may not be made, directly or indirectly, with TIF or developer
payments;
The local contribution must be used to pay project costs and cannot be used for:
1) general government purposes;
2) Improvements or costs that the municipality planned to incur.
6 1995 Policy Narrative
The municipality or authority may request contributions from the other local
government entities that will benefit from the district's activities. The contributions
count toward the local share.
If the state contributes to the project costs through a direct grant or similar incentive,
the required local contribution is reduced by 50% of the amount of the grant or
incentive.
The authority must annually submit a report regarding its local share to the
commissioner of revenue.
The amount of the local match is based on the type of the district. The authority or
municipality must:
Elect at the time of district approval to use the option,
In each year make a qualifying contribution equal to:
1) About 10% of the increment for an economic development, housing or renewal and
renovation district.
2) About 7 1/2% of the increment for a mined underground space district, redevelopment
district, hazardous substance subdistrict or soils district.
The maximum contribution for all districts in the municipality is 2% of the city's net
tax capacity.
The local option is effective for new districts and those certified after June 30, 1994. The
city must choose for districts certified prior to July 1, 1995, if it will use the option or pay
the penalty. The choice must be made by Dec. 31, 1995.
Soils Condition District
The soils district has been amended to limit the district to the presence of hazardous
substance, pollution or contaminants that require removal or remedial action. Tax
increment from the district may be used only to:
1) Acquire parcels;
2) Pay for the cost of removal or remedial action;
3) Pay for administrative costs, including the action response preparation costs.
Hazardous Substance Subdistrict
A hazardous substance subdistrict is defined in the definition section by a cross-reference
to the references in 469.175 subdivision 7. An extended subdistrict is defined to be a
hazardous substance subdistrict, but only after the overlying TIF district has been
terminated.
1995 Policy Narrative 7
The definition of captured value in a hazardous substance subdistrict and not an extended
subdistrict is the amount by which the original net tax capacity of the portion of TIF
district overlying the subdistrict exceeds the original net tax capacity of the subdistrict. In
other words, during the dual district period, the captured value is the difference between
the base values.
Pooling
The amount of an increment that can be expended outside a non -redevelopment district is
reduced to 20%. The new percentage will apply to districts for which the request for
certification was made after June 30, 1995.
But For Test
The "but for test" has been expanded to include a market value analysis. The analysis
must show that the market value of the site attribution to development not receiving TIF
assistance would be less than the increase on market value estimated to result from the
proposed TIF development after subtracting the present value of the projected tax
increments for the maximum duration of the district permitted by the plan. The market
value test does not apply to qualified housing districts.
Annual Disclosure - Reporting & Enforcement
The amendments regarding annual disclosure reporting, as well as enforcement of the act,
transfer duties and responsibilities from the Department of Revenue to the state auditor.
The major components of the amendments are:
The annual disclosure statement must report the mount of the increment paid to other
government bodies, the amount paid for administrative costs, and the amount of the
increment spent outside the district. If option (a) is selected for fiscal disparities, the
report must indicate the amount of the property tax increase.
The annual financial report must include the amount budgeted and expended for the
following additional categories:
1) Parking facilities, streets, roads, sidewalks;
2) Public park facilities, facilities for social, recreational or conference facilities.
The reporting requirements are extended to pre -1979 districts. In addition to the
individual district reports, the city must report to the state auditor for the entire
municipality the following:
1) Amount of any payments and the value of in-kind benefits, such as physical
improvements and the use of building space that are financed with TIF and are provided to
another governmental unit during the preceding calendar year.
8 1995 Policy Narrative
Clean-up Cost Recovery - Extension of District
An authority may, with the approval of the municipality, extend the duration of the district
beyond the statutory limits if the following circumstances apply:
After the district's establishment, contaminants, hazard substances or other materials
are found in the district;
The authority elects not to create a hazardous substance subdistrict;
The municipality pays for clean-up from the general fund or other non -TIF revenue.
If the district qualifies under the three factors, the district can extend the duration the
lesser of:
1) Ten years after the district would otherwise terminate;
2) The number of additional years needed to collect increment equal to the clean-up costs
paid by the municipality.
Clean-up costs are:
1) Limited to actual costs of removal and remediation.
Clean-up costs do not include:
1) Financing or interest costs;
2) Testing and engineering costs.
Clean-up costs must be reduced by any amounts recovered form private or responsible
parties.
Economic Development Districts
The provision that permits a small city (5,000 population or less) to establish a commercial
facility with an economic development district has been eliminated. An economic
development district for which certification is requested after June 30, 1995, may expend
increment to pay for site preparation and public improvements if:
Eighty percent or more of the district's area includes bedrock;
The estimated cost of the physical preparation of the site exceeds the land's fair
market value prior to completion of the preparation;
The increment is only used to prepare the site and pay reasonable administrative costs.
Parcels Not Included in Districts
The "20 year" exclusion regarding parcels formerly in an economic development district
has been deleted from the act. The section, however, has been amended to prohibit
parcels classified under the green acres or agricultural preserves provision from being
included in TIF districts.
1995 Policy Narrative 9
The amendment differentiates by regions of the state -metropolitan and Greater Minnesota.
The amendments state that a parcel cannot be part of a district if during any of the prior
five years, it was classified under chapter 273.111 or 273.112 (Green Acres) or Chapter
473H (Agricultural Preserves). In Greater Minnesota, the prohibition does not apply if the
parcel will be used for manufacturing purposes.
Special Laws
A general law amendment regarding special laws that extend the duration of a district is
beyond statutory terms in the TIF amendments. If a special law extends the limits of an
existing district or a new district, the city must:
Elect to pay the LGA/HACA penalty for the additional years or request the school
district to approve the adjusted tax capacity. (Adjusted tax capacity means that the
district's captured value is used in calculating the school aid formula. Therefore, the
school district would receive less state aid and more revenue locally).
Request approval of the county board and school district of the local law. The
election must be made prior to requesting local approvals.
IV) TRANSPORTATION
Laws 1995, Chapter 265)
Highways
No changes were made to highway funding and there are no additional gas taxes or
increased fees. Mn/Dot was appropriated $2,584,427,000. There is a shortage of funds.
Transit
Transit funding was increased significantly from last biennium but not to the level needed
to stay even with service demands. The biennium funding for general transit and metro
mobility was $84 million. This is up from $69 billion in the last biennium but down from
the $93 million requested or the $89 million budget allocation by the governor.
An interesting twist is the Met Council is authorized to spend at a $90 million level the
first year of the biennium. This may present an interesting dilemma during the 1996
session, since a sizable supplemental appropriation will be needed to keep transit afloat in
F.Y. 1997.
Noise Regulations
The law provides that no noise standards shall apply to an existing or newly constructed
segment of a highway, provided that all reasonably available noise mitigation measures, as
approved by the commissioners of the Department of Transportation and Pollution
Control Agency, are employed to abate noise.
10 1995 Policy Narrative
This language basically resolves problems encountered by city, county and state road
construction noise, as well as potential noise -based lawsuits involving highway
construction projects. Mn/Dot is required to conduct a study of noise barrier needs and
report back to the Legislature in 1996.
V) METROPOLITAN LAND PLANNING ACT
H.F. 833, Laws 1995, Chapter 176)
This chapter amends several provisions of the Metropolitan Land Planning Act, which was
first adopted in 1976. They are the first significant amendments to the act since its
adoption. This bill was sponsored by the Met Council and its major elements are:
1) Incorporation of Water Management Plans. Water management plans prepared by
cities pursuant to MS 103B.235 must be incorporated into the land use plan section of a
comprehensive plan and be submitted to the Met Council for review and comment.
Formerly, these plans were submitted to Water Management Organizations (WMOs) only.
2) Ten-year Review of Comp Plans. Metro area units of government must review and, as
necessary, amend their comprehensive plans by Dec. 31, 1998, and at least every 10 years
thereafter. Such review and, if necessary, amendment shall ensure that the fiscal devices
and local controls are not in conflict with the comp plans.
3) Merriam Amendment is Repealed. That amendment stated that the zoning ordinances
supersede the comp plan if there is a conflict.
4) Holding Zones are Allowed. An official control or fiscal device shall not be
considered to be in conflict with a comp plan if such official control or fiscal device is
adopted to ensure the planned orderly and staged development of urbanization or
redevelopment areas designated in the comp plan.
5) Uniformity of Controls/Fiscal Devices. After August 1, 1995, a city is prohibited
from adopting an official control or fiscal device which is in conflict with its plan.
6) Nine Months to Amend Ordinances. After approval and adoption of a revised comp
plan, a local government unit has nine months to amend its ordinances (same as current
law).
7) Amended Controls go to Met Council for Information. Copies of amended official
controls or fiscal devices must be submitted to the Met Council for information (but not
approval).
1995 Policy Narrative 11
8) Extensions May be Granted. The Met Council may grant extensions to the Dec. 31,
1998 deadline in order to allow the local government unit to complete the review and
amendments as required by this bill.
9) The key dates of the bill are:
A. August 1, 1995
Effective date of bill. After August 1, 1995, local government units shall not
adopt official controls which conflict with their comp plans.
B. Dec. 31, 1998
Review. By this date and every 10 years thereafter, each local government unit
shall review and, if necessary, amend its comp plan. The Met Council may grant
extensions to the Dec. 31, 1998 deadline.
C. Within nine months
Amendment process. Within. nine months after local government unit adoption of
comp plan (MS 473.865, subdivision 3) if an official control conflicts with a comp
plan as a result of an amendment to the plan, the official control shall be amended
by the unit within nine months.
10) Assistance Available if Needed. The Met Council must consult with local
government units to evaluate the need for technical and financial assistance to implement
this bill and report its findings to the Legislature by Jan. 15, 1996.
VI) ZONING ISSUES - PROCESS TIME
Laws 1995, Chapter 248, Article 18)
New time limits are established for certain permits and actions by governmental units of
the state including local, metro and state agencies.
An agency must approve or deny within 60 days a written request relating to zoning,
septic systems or expansion of the metro urban service area for a permit, license or other
governmental approval of an action. Failure to deny within 60 days constitutes an
approval. Denials must be stated in writing with reasons.
The 60 days begins upon receipt of a written request containing all information required
by law or previously adopted rule, ordinance or policy. An agency has up to 10 days to
make a written request for incomplete information. If an action requires approval of more
than one state agency in the executive branch, the time period begins for all executive
branch agencies when the first agency has received all pertinent data.
12 1995 Policy Narrative
The time limit is extended if a state statute, federal law or court order requires a process
prior to approval and the time periods for the stated process make it impossible to act in
60 days. Time is extended if prior approval is required by a state or federal agency.
Finally, an agency may extend the timeline by providing written notice to the applicant.
The notification reasons and anticipated length of extension must be included and may not
exceed 60 days unless approved by the applicant.
With agreement by an applicant, a process such as a complex or controversial rezoning
can be extended beyond the 60 -day time limit. This provision may prevent premature
denials by agencies faced with the more difficult actions.
The act is effective July 1, 1995 for any applicable request submitted after that date.
800 MHz RADIO SYSTEM
Laws 1995, Chapter 195)
An independent Metropolitan Radio Board is established to supervise and oversee the
fust -phase planning and implementation of a shared metro -wide radio system The board
will ensure the operation and maintenance of the system in such a way that subsequent
phases can be added. Staff will be provided by the Met Council until user fees become
available July 1997.
The board's plan for the fust -phase backbone of the region -wide system must be based on
Mn/Dot's recommendations. Mn/Dot is directed to contract for construction or lease of
the fust phase and is responsible for ownership and operation. The total initial cost is
about $30 million. The backbone system will serve Mn/Dot, Metro Transit, metro area
highway patrol and possibly the Metropolitan Airports Commission (MAC). Counties
must do a county -wide plan including cities (which must cooperate). First-class cities will
do an individual plan. Participation in the 800 MHz radio system is voluntary: Cities or
counties may join at any time.
Capital funding includes $10 million in revenue bonds for Public Safety Mutual Aid, $3
million in transit bonds and an agreement that $15 million state bonds will be a high
priority for the 1996 state bonding bill.
The public safety and operational costs will be paid primarily from up to four cents of the
911 telephone tax. $194,000 was appropriated from state highway funds to secure the
necessary radio channels from the FCC and to cover other preliminary costs.
1995 Policy Narrative 13
The radio board consists of 17 members: one elected representative from each of the
seven counties, Minneapolis, St. Paul and Bloomington; five governor appointees (based
on recommendations by various organizations including two suburban elected officials by
AMM, one elected city official by LMC, one metro sheriff and one metro police chief);
one Met Council member, and Mn/Dot's director of Electronic Communications.
The board sunsets July 1, 1999. The Legislature will determine if the activity is to be
transferred to the Met Council or a state agency. The primary purpose of the shared radio
system is to coordinate usage of a dwindling supply of radio channels in the metro region,
at a time when demand is growing rapidly. The act is effective Aug. 1, 1995.
All of AMM's primary concerns were met:
Cities will not be forced to modify current systems, purchase new equipment
prematurely or become part of the metro system until they voluntarily choose.
The system will provide a phased transition so that uninterrupted service is guaranteed
The system will be flexible to allow various local coordinated dispatch and service
arrangements.
Governance will be representative of entities and users who will ultimately bear the
cost but not dominated by any single user group.
VIII) ECONOMIC DEVELOPMENT & HOUSING FINANCE
Laws 1995, Chapter 224)
The Legislature enacted several pieces of legislation relating to economic development.
The legislation includes the appropriations bill as well as sections of the bond allocation,
state departments, omnibus tax and the public finance bills. The following is a summary of
the major components of the various initiatives:
Development of Trade/Economic Development (DTED): Budget
The agency's budget for the 1995-1997 biennium totals $58.1 million. Of the total, the
following appropriations were identified:
Six million for economic recovery grants. This is a one-year appropriation. The
program's future will be, in part, determine by a legislative auditor's report that is due
during the 1996 session. The appropriation is below the governor's recommendations
of $14.0 million in new funds and the agency base level funding.
About $379,000 each year for the small cities federal match.
Approximately $1.9 million each year for the jobs skMs partnership program
About,$7.8 million for the biennium for the pollution clean-up program authorized
under sections 116J.551 to 116J.558.
14 1995 Policy Narrative
Customized job training grants of $300,000 to the St. Paul Port Authority and
200,000 to the Minneapolis Community Development Agency.
Two million for the continuation of the Community Resources Program (CRP) in
Minneapolis, St. Paul and Duluth.
Department of Economic Security: Budget
The department's total budget if $99.6 million. Of the total, the following appropriations
are identified:
Approximately $935,000 each year of the biennium for transitional housing operations.
Three million for 1995, for summer youth employment programs.
Minnesota Housing Finance Agency (MHFA): Budget
The agency's budget is $47.5 million for the biennium. The budget is $13.5 million above
the current biennial budget. The agency's budget for each year is $30.1 million for F.Y.
1996 and $17.4 million for F.Y. 1997. The major components of the budget are:
1) An Additional $6 Million for the Affordable Rental Investment Fund. The current
biennial appropriation approximates $7 million. The appropriation includes language that
directs the agency to work with public and private agencies in the McKnight Foundation
regional to establish priority uses for the funds. In addition to the regional priorities, the
agency must give preference to economically viable projects in which local governments,
employers and the private sector contribute financial assistance.
2) Develop Priorities for Fund Usage. In the metro area, the agency shall collaborate
with the Met Council to develop priorities for us of the funds. The Legislature also
directed that the MHFA shall give preference to economically viable projects that:
Include local financial contributions;
Consider the availability of public transportation;
Take into account job training efforts in the community;
About $5.8 million for the Community Rehabilitation Program (CRP). Of the CRP
appropriation, $250,000 must be used each year for full -cycle home ownership and
purchase -rehabilitation lending initiatives. Twenty percent of the CRP must be made
available for use in low income neighborhoods of Minneapolis and St. Paul for the
home ownership programs.
Approximately $30 million in revenue bond proceeds are available and originate from
a pre -1981 bond.
For example, the proceeds can be made available for non -first time buyers and income
and purchase price limits are not subject to current federal guidelines. The Legislature
required the agency to give priority for use of the proceeds to cities that receive a CRP
grant.
1995 Policy Narrative 15
About $1.5 million each year for rent assistance and/or family stabilization.
The governor has vetoed $500,000 for lead abatement and $200,000 of a $400,000
appropriation for emergency mortgage foreclosure prevention and emergency rental
assistance.
IX) ISSUES NOT PASSED IN 1995
There were several bills of interest or concern that the AMM reported on during this
session which did not pass. Technically, these bills are still "alive" and can be considered
when the Legislature reconvenes in January.
Housing as a Regional System
H.F. 1258 - Hausman; S.F. 1233 - Pappas)
This bill as introduced would have made housing a fifth regional system and required the
Met Council to establish affordable housing goals for each city.
Codification of Regional Blueprint
H.F. 1114 - Entenza; S.F. 1109 - Novak)
This bill also would have required the Met Council to establish affordable housing goals
and codified into statute portions of the Regional Blueprint.
Land Stewardship Land Use Planning Bill
H.F. 779 - Orf eld; S.F. 698 - Morse)
This bill virtually froze the MUSA line and established additional requirements for
comprehensive plans. It also would have allowed residents throughout the state to bring
civil action against the Met Council if local actions were not in compliance with Met
Council plans and policies.
Direct Election of Met Council Members
H.F. 609 - Orfield; S.F. 1107 - Mondale)
This bill would have established direct elections of a 16 -member Met Council and
provided public financing for candidates.
Property Tax Freeze
The Senate -proposed property tax and levy freeze did not become law. The Senate
passed the freeze bill (S.F. 1570) and then re -passed it three different times attached to
other House files (H.F. 602, 603 and 1864).
During the final week of the session, the House leadership agreed to report out a
conference report on H.F. 603. However, neither the Senate nor the House leadership
could muster more than 15-20 House members to support the bill. The bill never came to
a vote on the House floor.
16 1995 Policy Narrative
Up to the last week of the session, the governor's staff had insisted he would veto a
freeze, but rumor during the last days indicated that if presented with a freeze bill, he
would sign it.
Municipal Bond Interest Taxation
The House Tax Committee chair Ann Rest pushed to have all state and local bond interest
taxable for income purposes. But due to extreme municipal pressure, the issue was
dropped.
Beg for Your LGA/HACA
A House provision by Rep. Dawkins would have required metro area cities to prove they
were being efficient and attempting to provide services cooperatively with other units to
receive all of their LGA/HACA. This was turned into a statewide study by the Legislative
Commission on Planning and Fiscal Policy.
School Property Tax Constitutional Amendment
The House -passed bill to remove schools from the local property tax was not taken up by
the Senate. It does not indicate where funds might come from to replace local property
tax. About $2 billion of replacement funds would be needed and could come from
income, sales or a state -imposed property tax. Although the bill did not pass this year, it
may and probably will be reconsidered next year.
Municipal Tort Liability Increase
An increase to the current $200,000/$600,000 municipal liability limits was well in its way
to passage until it became embroiled in a political battle over joint and several liability
language. This issue will be back next year since the current limits have not been adjusted
in 10 years.
Gas Tax & Transit Funding
This was the year (supposedly) for a political agreement to increase the gas tax for
highway funding and to provide alternatives and increased funds for metro transit
initiatives. It did not happen.
The House would not budge until it got a signal from the governor for gas tax support.
The signal did not come until the last week of the session and then it was weak at best.
The Senate would not do anything for transit until a gas tax increase was agreed upon.
1995 Policy Narrative 17
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