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Home My WebLink AboutCity Council Packet 02-24-2015 SpecialCITY OF PLYMOUTH AGENDA SPECIAL COUNCIL MEETING FEBRUARY 24, 2015, 5:30 p.m. MEDICINE LAKE CONFERENCE ROOM 1. CALL TO ORDER 2. TOPICS A. Park Dedication Fees B. Set Future Study Sessions 3. ADJOURN Special Council Meeting 1 of 1 February 24, 2015 2A rip Plyri;outh Adding Quality to Life PARK DEDICATION FEE ANALYSIS February 2015 Prepared by Parks & Recreation INTRODUCTION The analysis was done to review and update the park dedication fees charged to new residential, commercial and industrial development to ensure the following: 1. The fees are sufficient to support the acquisition of land and/or open space for future park facilities 2. The fees are sufficient to support the development of new parks, playgrounds and open space areas for the community ABOUT PARK DEDICATION Minnesota Statutes Section 462.358, Subd.2b provides that municipal subdivision regulations may require that a reasonable portion of any proposed subdivision be dedicated to the public, or preserved for conservation purposes or for public use as parks, playgrounds, trails, wetlands, or open space. The municipality may alternatively accept an equivalent amount in cash. The City of Plymouth addresses park dedication within the City Code (528.01). Dedication Required (528.03) At the time of subdivision, the developer shall dedicate land for public use as parks, playgrounds, recreation facilities, trails, or public open space, in an amount equal to the development's proportional share of the City park system, as determined by this chapter. Any land dedication shall be in a location and of a character consistent with and suitable for meeting the needs identified by the City's Comprehensive Plan. Generally, land located within flood plains, or wetlands shall not be accepted to meet the proportional share of required land dedication. If the Council determines that land is not needed in the area of the proposed subdivision, the City may alternatively require payment of an equivalent amount in cash. Any such cash payment shall be used for the acquisition and improvement of land for parks, playgrounds, trails, or public open space, or as otherwise provided by statute. The cash fee payment in lieu of land dedication is set by Chapter 1015.31 Subd.S and reads as follows: Cash Fee Payment in Lieu of Land Dedication. Undeveloped land value shall be used to determine the cash payment required in lieu of land dedication up to a maximum cash payment of $6,500 per dwelling unit for residential development, or $8,000 per acre for commercial/industrial development or schools (based on the acreage after wetlands, areas below the 100 -year flood elevation, and areas below the ordinary high water level of lakes and streams are deducted). 2 BACKGROUND The City of Plymouth has been utilizing park dedication fees since 1979. Those fees were reviewed and/or adjusted on an annual or semi-annual basis up until 2008. In 1979 the park dedication residential rate was $330/unit and the current rate established in 2008 is $6,500/unit. Park dedication rates have been at $6,500/unit for the last seven years. Residential Per Unit Rate 7,000 $6,500 6,000 6,000 5,000 4,000 3,000 2,000 $1,600 1,000 $ 825 o 1011111111111111111 1 11 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 On an annual basis, the Minnesota Park and Recreation Association (MRPA) and/or member organizations conduct a survey to track and benchmark community park dedication fees and methodology. The most recent survey (2014) indicates that park dedication fees for residential property varies from $2,850 per unit to $6,500 per unit. Although it is interesting to review and compare fees, the data is of little value because it does not reflect each unique park dedication formula and methodology, nor the difference in land values from city to city. Each community establishes its own park dedication formula or methodology. Some common park dedication methodologies for residential development include: Fixed cash dedication fee based on acreage or dwelling units Cash fee based on anticipated population Cash or land equal to a percentage of land value or area Other 3 Woodbury Shakopee Plymouth Maple Grove Inver Grove Heights Eden Prairie Eagan Chanhassen Brooklyn Park Bloomington Blaine Apple Valley 2014 RESIDENTIAL DEVELOPMENT COMPARISON 3,500 5,340 6, 500 3,873 2,850 6, 500 3,558 5,800 4,600 5,700 3,094 0 $1,000 $2,000 $3,000 4,584 4,000 $5,000 $6,000 $7,000 Like Plymouth, many of these communities have not increased park dedication fees in the last three to five years. It is also important to note that most cities use a mix of land and cash dedication, either in tandem or as separate options. In addition to residential park dedication fees, most communities also utilize a formula for commercial/industrial development. Similar to residential park dedication fees, each community establishes their own formula or methodology as referenced above. PLYMOUTH - PARK DEDICATION FORMULA Plymouth's park dedication methodology is a formula which takes into consideration a variety of factors including proportional per capita share, number of residents/employees (proposed in development and city wide), the total park land area identified in the Comprehensive Plan, undeveloped land value current assessed value at time of platting or a sale price within one year of time of platting, which ever is greater) and a maximum per unit cash payment of $6,500 for residential development and $8,000 per acre of commercial/industrial development. The current park dedication formula utilizing the 6,500/unit cash fee equates to an $115,000/acre undeveloped land value. Staff reviewed residential development data to determine an average per acre land value cost, used in calculating park dedication. The annual combined average value was as high as $192,000 an acre in 2007 and as low as $126,250 per acre in 2012. It is important to highlight that since 2007 all of the land value averages have been higher than the $115,000 land value reference above. In addition to an increase in residential park dedication fees, consideration should be given to different types of development. To date, there is no differentiation between the types of residential development 4 when calculating park dedication; $6,500 per unit has been the number placed in the formula when calculating dedication for a single family neighborhood, a senior housing neighborhood or another type of multi -family neighborhood. The argument has been made that people living in an apartment unit uses the parks system in a similar manner as people living in a single family home, therefore, the decision has been to require the same dedication amount per unit. In the past this has been true for senior housing projects as well. However, an argument could be made that those living in senior facilities don't use the parks system as much as single and multi -family residents, and because of this a different per unit dedication amount could be considered. LAND VALUES Mentioned earlier in the report, the value of land is established at the time of platting and is generally either the current assessed value or the value based on a sale that has occurred within the past year. Because the developer has not closed on the property at the time of platting and release of the final plat, the actual developer's price is not known and therefore not used in the calculation. In some instances, if the City is purchasing additional land, the developer has disclosed the purchase price of the property that is then used in the park dedication formula. Below is a chart showing actual sale prices paid by developers for recent neighborhoods. Residential land acquisition data from the Hennepin County Assessors office indicates that per acre sales values in the last quarter of 2014 and beginning of 2015 are in the range of $150,289 to $241,176. Several notable land acquisitions this past year were: PID or Sale Sale Indicated Price Development Name Date Price Acres Per Acre from Sale ISD 284 — CSAH 47 land swap 6/2/2014 6,251,000 31.95 195,649 ISD 284 — WHS/Creekside Unknown 7,200,000 38.3 187,990 City of Plymouth 10/6/2014 3,701,800 18.07 204,859 Brynwood (Begin Property) 10/6/2014 9,200,000 39.35 233,799 Source: Hennepin County Assessors Office — 2014-2015 Land Acquisition in Plymouth PARK DEDICATION RECOMMENDATION Staff recommends increasing the cash payment required in lieu of land dedication from a maximum cash payment of $6,500 per dwelling unit for residential development to $7,500 per dwelling unit. Staff is not recommending any adjustment to the commercial/industrial park dedication fee. The increase in the residential development cash payment is necessary so that the Park Dedication Fund is able to pay for the acquisition of land and/or open space for future park facilities and development of new parks, playgrounds and open space areas for the community. The estimated build -out cost of the 5 park system is just over $28 million, which includes acquisition and development of neighborhood parks, the Northwest Greenway, new trails, and other projects. A 10 year analysis of the Park Dedication Fund was completed to forecast the viability of the fund, taking into consideration projected residential development, park system build -out cost, investment interest and inflation. Based on this information, without a fee increase and/or incremental increases in the coming years, the fund will be depleted by 2022. Future Residential Park Dedication Cash Fee Options If there is no increase or changes to the park dedication fees (remains at $6,500 per unit), the fund will have a negative cash balance in 2022 and an estimated funding gap of $8,868,845. 8,000,000 6,000,000 4,000,000 2,000,000 2,000,000) 4,000,000) 6,000,000) 8,000,000) 10,000,000) Park Dedication Fund Cash Balances 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Option #1— a $1,000 increase in 2015 and a $500 increase in years two through ten. The fund will have a negative cash balance in 2024 and an estimated funding gap of $3,127,643. Option #2 — a $1,000 increase in 2015 and 5% annually thereafter. The fund will have a negative cash balance in 2024 and an estimated funding gap of $3,669,606. Option #3 — a $1,000 increase for years 2015 through 2020 and $500 annually increase thereafter. The fund will have a negative cash balance in 2025 and an estimated funding gap of $528,575. Staff recommends that park dedication fees are reviewed and adjusted on an annual basis. 11 rp)City of Plymouth Adding Quality to Life SPECIAL COUNCIL MEETING February 24, 2015 To: Mayor and City Council Prepared by: Dave Callister, City Manager Item: Set Future Study Sessions Agenda 2BNumber: Staff advertised for the At Large vacancy on the Planning Commission which was held by Gordon Petrash. The term of this positon expires January 31, 2016. Council has received the applications for this seat, and staff is requesting direction from Council (make an appointment or conduct interviews). Council should also review the list of pending study sessions below and set meetings as desired. Calendars are attached to assist with scheduling. Pending Study Session Topics at least 3 Council members have approved the following study items on the list) Rental Housing Ordinance Other Council requests for Study Session Topics: Health insurance premiums (JW) Consider Medicine Lake Water Level Study (tabled from January 27th Council Meeting) Review hourly rate vs. participant rate for use of playfields (2016 budget) Staff's requests for Study Sessions: Underground power on Vicksburg Lane Transit Update (March/April) Comprehensive Plan Update (May) Page 1 City of Plymouth Adding Quality to Life March 2015 1 2 3SPEC5:30 PM 4 CANCELLED 5 6 7IALCOUNCILPLANNING MEETING COMMISSION MTG. Police Staffing needs Council Chambersfor2016 Medicine Lake Room 5:00 - 7:00 PM 5:00 - 7:00 PM 1-494 li 1-394 1-494 li I-394 PROJECT PROJECT OPEN HOUSE OPEN HOUSE Maple Grove Ridgedale Library, Community Center, Robert H. Rohlf Room Banquet Room 8 9 10 11 12 13 14 7:00 PM 7:00 PM 1:00 PM - 4:00 PM Healthy Living Fair REGULAR COUNCIL ENVIRONMENTAL 9:00 AM - Plymouth Creek MEETING QUALITY 12:00 PM Center Council Chambers COMMITTEE (EQC) City Sampler MEETING Plymouth City Hall Daylight Savings Medicine Lake Room Commences Set Clocks Ahead 1 Hour 15 16 17 18 19 20 21 7:00 PM PLANNING COMMISSION MEETING Council Chambers 22 23 24 25 26 27 28 7:00 PM 7:00 PM 12:00 PM -3:00 PM REGULAR COUNCIL HRA MEETING Spring Bridal Expo MEETING Medicine Lake Room Plymouth Creek Council Chambers Center 29 30 31 Modified on 02119115 CHANGES ARE MADE IN RED Page 2 r Plymouth Adding Quality to Life April 2015 Modified on 01/21/ 15 CHANGES ARE MADE IN RED Page 3 1 2 3 4 7:00 PM PLANNING COMMISSION MEETING Council Chambers Good Friday PASSOVER Begins at Sunset 5 6 7 8 9 10 11 7:00 PM 6:00 PM - 9:00 PM 9:00 AM - 1:00 PM ENVIRONMENTAL PLYMOUTH HOME PLYMOUTH HOME QUALITY EXPO EXPO COMMITTEE Plymouth Creek Plymouth Creek EQC) MEETING Medicine Lake Room Easter Sunday 12 13 14 15 16 17 185:30 PM SPECIAL COUNCIL 7:00 PM Time Varies Time Varies MEETING PLANNING PRIMAVERA PRIMAVERA Health Insurance COMMISSION Plymouth Fine Plymouth Fine Premiums Arts Council Arts Council Medicine Lake Room MEETING Show Show Council Chambers Plymouth Creek Plymouth Creek 7:00 PM Center Center REGULAR COUNCIL MEETING Council Chambers 19 20 21 22 23 24 25 Time Varies Time Varies 7:00 PM 7:00 PM PRIMAVERA PRIMAVERA PLYMOUTH HRA MEETING Plymouth Fine Plymouth Fine ADVISORY Medicine Lake Room Arts Council Arts Council COMMITTEE ON Show Show TRANSIT (PACT) Plymouth Creek Plymouth Creek Center Center MEETING Medicine Lake 26 27 28 6:00 PM 29 30 BOARD OF EQUALIZATION MEETING Council Chambers 7:00 PM REGULAR COUNCIL MEETING Council Chambers Modified on 01/21/ 15 CHANGES ARE MADE IN RED Page 3 r Plymouth Adding Quality to Life May 2015 Modified on 11/ 19/ 14 CHANGES ARE MADE IN RED Page 4 1 2 3 4 5 6 7 8 9 7:00 PM PLANNING COMMISSION MEETING Council Chambers 10 11 12 6:00 PM 13 14 15 16 BOARD OF 7:00 PM 7:00 PM EQUALIZATION ENVIRONMENTAL PARK £t REC MEETING QUALITY ADVISORY If Necessary) Council Chambers COMMITTEE COMMISSION EQC) MEETING PRAC) MEETING 7:00 PM Medicine Lake Room Council Chambers REGULAR COUNCIL MEETING Council Chambers 17 18 19 20 21 22 23 7:00 PM PLANNING COMMISSION MEETING Council Chambers 24 25 26 27 28 29 30 7:00 PM 7:00 PM REGULAR COUNCIL HRA MEETING MEMORIAL MEETING Medicine Lake RoomX31DAYCouncilChambers Observed CITY OFFICES CLOSED Modified on 11/ 19/ 14 CHANGES ARE MADE IN RED Page 4