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009-70 i)
Date: October 12, 2004
To: Honorable Mayor and City Commissioners
From: Engineering
RE: Amendment to the Special Assessment Policy
SUMMARY OF REQUEST:
As a result of a Legislative Committee meeting, it is respectfully requested that the special
assessment policy be amended in the following form:
sub-paragraph “a” (on page 6) of paragrap 10 of section “C” Part “V” of the special
assessment policy be amended to read: It
This amendment applies only to those activities/improvements eligible under the table on
page 4 of said policy. Furthermore, it is requested that if the amendment is adopted,
implementation be limited to those projects where special assessment districts have been
created after January 1°' of 2005.
FINANCIAL IMPACT:
None anticipated at this time.
BUDGET ACTION REQUIRED:
None.
STAFF RECOMMENDATION:
Amend the special assessment policy.
COMMITTEE RECOMMENDATION:
POLTCY FOR STREET CONSTRUCTION,
RECONSTRUCTION, AND RESURFACING
Purpose
a) Establish a uniform City wide assessment program
for street improvements.
Improve the quality, City wide, of street
conditions.
Provide for additional revenues from assessments,
which recognizes the benefit to abutting private
property as well as the public in general.
Provide for a method of assessment which is fair
and equitable while recognizing the financial
impacts upon property owners and renters.
Provide for a systematic annual reporting and
Monitoring procedure to review the effectiveness
‘of the policy.
Provide for Commission and Citizen involvement in
establishing the application of engineering
standards and design.
Establish standards, which provide for the safety
of vehicles and any other mode of transportation
that may inhabit the roadway.
Definitions
1. Maintenance
Maintenance is defined as those routine
activities necessary to sustain the integrity of
the pavement structure. Maintenance activities
include crack sealing, chip sealing, and pothole
patching. They do not add significantly to the
pavement structure and do not extend
serviceability. Maintenance activities preserve
serviceability. The City has established and is
implementing an ongoing maintenance program to
protect and preserve the serviceability of our
better streets those streets that are in
relatively good condition. Funds for this come
from the operating budget. These activities are
not assessable.
Rehabilitation
Rehabilitation of street surfaces includes those
activities, which rejuvenate in whole or in part
existing street surfaces. These activities
include large surface patching and recycling of
existing street surfaces. These activities are
not assessable improvements.
Resurfacing
Resurfacing is the application of a nominal 1” or
more of new surface or a leveling course and
nominal 1” of new surface to an existing street.
This improvement is an assessable street
improvement to abutting properties.
Milling and Resurfacing
Milling and resurfacing includes the partial or
total removal of asphalt surface and application
of new leveling course and/or wearing course.
This procedure significantly extends the useful
life of the street and is an assessable
improvement.
Major rehabilitation and resurfacing
Improvements, which include widening and/or
replacement of the surface (concentrate or
asphalt), are considered major rehabilitation and
are an assessable improvement.
Reconstruction
Reconstruction includes work, which typically
requires the removal of the pavement structure
and replacement with new construction whether
asphalt or concrete. Reconstruction is an
assessable improvement.
7. New Construction
Several streets and most alleys in the City are
not hard surfaces but rather are dirt, sand or
gravel. New construction is the placement of a
new street base and surface improvement to
previously unpaved streets. This is assessable.
8. New Development
Very little unpolluted land remains for
development within the City. When this land is
developed with streets, the total costs of street
improvement are the responsibility of the
developer. An assessment district at the City’s
option may be utilized to finance these
improvements.
9. Standard Residential Width
The width of the paved portion of a street from
pavement edge to pavement edge. At the time of
the adoption of this policy, the standard
residential width is 23 feet.
C. Policy
1. Statement of policy
The policy of the City is to assess a portion of
street improvements to all existing streets, up
to a maximum stated cost per front foot for each
type of improvement.
2. Abutting properties
Assessments to abutting properties are reduced
when available grants or other revenues are
applied to the project (such as LDFA funding) .
3. Widening
Widening of streets are assessable improvements
up to the maximum assessable width.
New development streets
New development street improvements are the
responsibility of the developer; however, they
may be totally assessable at the option of the
City. Installment payment of assessments may be
established in each project up to ten years.
Accessibility of activity
Accessibility of an activity, its share of total
cost Assessable the area assessed and the amount
to be assessed per front foot shall be determined
on a annual basis by the assessor's office in
November for the following year.
Implementation of assessment
Policy shall be implemented as follows
a) All streets, including subdivision streets,
shall be constructed or reconstructed to
engineering standards and design as
established by the City, unless determined (
that sufficient reasons exist to provide :
exception/deviation from standards.
b) All new development requiring streets shall
be the responsibility of the developer;
however, when available, and deemed
advisable by the City Commission, the city
may utilize special assessment bonding to
provide for street and public
infrastructure, assessments to the
properties benefiting to the extent by law.
c) The method of assessment for the work
determined assessable shall be as follows:
(2) Cost of the work shall include all cost
Girectly and indirectly chargeable to
the project.
(2) Assessments to abutting benefiting
properties shall be established as an
annual frontage charge based upon the
previous year construction projects,
i.e., costs per front foot up to the
maximum established by this policy.
Should the actual construction cost be
less than the annual front footage
charge, the assessments will be reduced
proportionately.
The amount assessable to abutting
properties shall be equal to the cost
of the standard residential street,
regardless of the actual width in
excess of this standard constructed.
For streets having less than the
standard residential street, front
footage assessment will be
proportionately reduced.
Grants, aids and alternate funding,
such as and including LDFA funding for
street construction shall first be
applied to the City’s share of the
cost. Where grants and aids exceed the
City’s cost, the assessment to abutting
properties shall be reduced prorate.
The city shall establish a street
reconstruction revolving fund to
provide for payment of improvement
costs and reimbursement from
assessments which are used to reimburse
the Revolving fund which has so
financed an improvement, may be based
upon an amortization period of up to 10
years at an interest rate to be
established by the Finance Director,
using borrowing rates in effect at the
time of the financing through the
Revolving Fund. In cases where no
bonding has produced construction funds
or they are insufficient, this fund
shall be available to finance
improvements where assessed property
owners do not otherwise qualify for
assistance under other programs.
The City shall establish a fund through
the Community Development Block Grant
program that will be available for low
and moderate-income families on a
sliding scale to provide grants and
loans to qualified owners and renters
of occupied dwelling units. This scale
and schedule and application for
assistance shall be bases upon
guidelines published by the United
States Department of Housing and Urban
Development and shall be adjusted
annually or as adjusted by said federal
standards.
Storm sewer systems, sanitary sewer
systems, and water systems shall not be
considered within the assessment costs
of street paving projects. These by
connection fees, user fee and special
assessments.
Where there exists a residual value of
the street and determination of a
residual value is appropriate for the
project, this value is appropriate for
the project, this value shall serve to
offset the assessment based upon the
proportional value of useful remaining
life to the total project cost, as
calculated by the City Engineer.
(10) The following adjustments and special
considerations may be made
(A) In no case shall assessments be in
4» excess of benefits to abutting
wr A properties
QS a &
‘y
ew ov (B }) Assessments shall be adjusted for
99
all corner lots applying 100% of
the short-side frontage and 50% of
the long-side frontage up to a
maximum of 150 feet on the long-
side frontage.
(C) On through lots, (street to
street), having less than an
average of 200 feet of depth,
measured between right-of-way
lines; the lot assessment shall be
reduced 50% of both frontages to
be assessed.
(D) Where the frontage at the street
line is reduced, front foot
assessments are based upon lot
width parallel to the front street
at the building set back lines.
(BE) Driveways and sidewalks where
replaced in the discretion of the
City shall not be part of the
general special assessment but
shall be borne by the property
owner and added to each assessment
through a contract or waiver
process. Driveways will normally
be built or replaced in major
rehabilitation, reconstruction and
new construction projects. The
City will, for existing concrete
or bituminous drive approaches,
from 50% to a residual basis
decided by the City, up to its
existing width. All cost for the
balance of or widening of the
Grive approach shall be borne by
the property owner.
(F) Curbs, storm sewers and other
storm system improvements are not
part of the assessable street
improvements to abutting
properties and are designed and
included at the option of the
City. Storm water improvements
may be assessed through other
policy and procedure.
(11) The City will implement local street
projects initiated by citizens on first
come first served basis up to the limit
of funds available in a given year.
The cut-off date for receipt of
petitions shall be August 30 for the
following construction year. This will
allow sufficient time for surveys and
evaluation to initiate construction on
the following construction season.
a) Petitions received earlier in the
year will be studied, as the
current construction workload
shall allow.
D. Special assessment procedure
1. Petition
Proceedings may be initiated by the City
Commission or by petition of affected property
owners. If a petition is used, owners of
property having 50% of the frontage shall sign it
or, in benefit cases, comprising 50% of the land
area to be benefited. The petition shall be
filed at the City Clerk’s office.
Initiation of street assessment
When initiating a street assessment proceeding,
or when accepting a petition, the Commission
shall order a feasibility report on the proposed
improvements, and appraisal information relating
to present value and expected benefit to the
assessed properties.
City Engineer
The City Engineer shall present
a resolution to
the City Commission to set the hearing date to
consider the creation of a special assessment
district.
Engineering Department
rs
The Engineering Department shall notify the other
affected departments (Finance, Treasurer, and
Assessor) that a special assessment is in
progress.
Project survey card
The City Engineer shall insure notice of the
first hearing accordance with Charter and State
law. The City Engineer shall insure that notice
is given, including mailing and publication
through the City Clerk’s office. The City
Engineer shall notify all affected property
owners of the date scheduled for the public
hearing by letter from the City Manager. The
letter shall enclose a “Project Survey” card and
a copy of the Commission resolution setting the
hearing date. The project Survey card shall list
the estimated amount of special assessment
expressed in terms of dollars per front foot (or
in the case of a benefit assessment, expected per
parcel benefit). The card shall provide for a
favorable or unfavorable response, with a request
to mail the card back to the City expressing the
owner’s position as being “for” or “against” this
project.
Preparation of a Report
The City engineer will prepare a report
describing the improvement and determining the
feasibility thereof. It will address such
factors as the need for the project, an estimate
of cost and other pertinent information
reflecting this policy and special conditions of
the project if any.
Evaluation
The card results, the city Engineer’s feasibility
report and all other relevant material shall be
presented to the City Commission at the public
hearing set forth in the notice.
Action at First Hearing
The City Commission shall consider the city
Engineer's report, evaluation and benefit
information, the card tabulations and the written
or oral comments of property owners attending the
hearing and shall determine whether to defer or
proceed with the project, said decision to be set
forth benefit to the property exceeds or equals
the assessment where the project will proceed.
The City Commission shall adhere to the State law
concerning protests. If the City Commission
resolves to proceed, it shall appoint a board of
assessors consisting of two City Commissioners
and the City Assessor, which shall function as
set forth below whether or not the assessment is
on a frontage or benefit basis.
Decision to proceed
In the event the City resolves to proceed with
the improvement and the requisite number of votes
therefor are cast, the Commission shall direct
the preparation of a special assessment roll and
shall further order the City staff to proceed
with project design, preparation of
specifications and the bidding process as
appropriate. The Finance Department shall
prepare financing plans including submission of
applications to the Michigan Department of
Treasury, beginning of bonding proceedings or
other preparation called for by this policy or as
is appropriate. The financing plans shall
include the interest rate to be paid on the
assessment. (If bonds are to be sold, the
interest rate shall be determined by the interest
rate on bonds plus 1%)
LO. Submission of Materials to Board of Assessors
The information reviewed by the City Commission
at the first hearing together with all materials
prepared by staff shall be submitted to the Board
of Assessors, which shall prepare the assessment
roll. The assessment. roll shall be based upon
the lowest bid recommended by staff.
Daas Second Hearing
After official notice has been given to each
affected property owner according to State law
and Charter, the second hearing shall be held to
give the matter of the amount of the actual
assessments being levied and the roll to be
confirmed. After the second hearing the City
Commission shall determine whether or not to
confirm the assessment roll. If it determines
not to confirm but still intends to proceed, it
shall return the assessment roll to the Board of
Assessors who shall review it and resubmit it at
an adjourned hearing noticed in accordance with
the law. As such time, as the assessment roll is
confirmed, the assessment shall be considered
levied. Copies of the confirmed roll shall be
sent to the Finance Department, the Treasurer’s
office, the City Assessor and the Clerk. In
addition the confirmed roll and other relevant
records shall be sent to bond counsel for review
in the event bonding is to be used for the
payment of the cost of the project:
12. Special assessment billing
Procedures shall be followed to add special
assessments to the tax rolls in the event of
nonpayment. Special assessments shall be a lien
on the property on the Date of confirmation.
13. Deferral
Request for deferrals under State statutory
procedures or City procedures shall be handled
through the City Assessor's office. Applications
for financial assistance under Community
Development Block Grant program, other payments,
loans or grants available for individual property
owners or renters shall be processed upon
notifications of assessment billings.
confirmed. After the second hearing the City
Commission shall determine whether or not to
confirm the assessment roll. If it determines
not to confirm but still intends to proceed, it
shall return the assessment roll to the Board of
Assessors who shall review it and resubmit it at
an adjourned hearing noticed in accordance with
the law. As such time, as the assessment roll is
confirmed, the assessment shall be considered
levied. Copies of the confirmed roll shall be
sent to the Finance Department, the Treasurer's
office, the City Assessor and the Clerk. In
addition the confirmed roll and other relevant
records shall be sent to bond counsel for review
in the event bonding is to be used for the
payment of the cost of the project:
12. Special assessment billing
Procedures shall be followed to add special
assessments to the tax rolls in the event of
nonpayment. Special assessments shall be a lien
on the property on the Date of confirmation.
13. Deferral
Request for deferrals under State statutory
procedures or City procedures shall be handled
through the City Assessor’s office. Applications
for financial assistance under Community
Development Block Grant program, other payments,
loans or grants available for individual property
owners or renters shall be processed upon
notifications of assessment billings.
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/ 2002-58 (n)
AMENDED TABLE AS OF 05/14/02
Activity/improvement Share of Total Area Amount to be
Cost Assessable Assessed Assessed per
front foot
1. Maintenance 0% 0 N/A
2. Rehabilitation 0% 0 NIA
3. Resurfacing 45% * $6.40 ***
4 Milling/Resurfacing 45% * $11.40 ***
5. Rehab./Resurfacing Majo 45% " $18.70 ***
6. Reconstruction 45% e $19.70 ***
7. New Construction 45% * $19.70
8. New Subdivision 100% ** Actual
(where assessed)
* standard residential width ;
** entire improvement performed by City
** these front foot assessments included an adjustment reflecting credit
for residual value of existing street per Section V (C) (9), with
total assessment not to exceed benefit to abutting property.
Vv Assessment Policy; Improvements Included; Allocation of
Cost: Financing and Scheduling — This policy shall be
implemented as follows:
A. Design and Engineering - All streets, including subdivision streets, shall be
constructed or reconstructed to engineering standards and design as
established by the City, unless determined that sufficient reasons exist to
provide exception/deviation from standards.
B. New Subdivision Development - All new development requiring streets shall be
the responsibility of the developer; however, when available, and deemed
advisable by the City Commission, the City may utilize special assessment
bonding to provide for street and public infrastructure, assessments to the
properties benefiting to the extent permissible by law.
Cc. Assessment Method — The method of assessment for the work determined
assessable shall be as follows: :
1. Cost of the work shall include all cost directly and indirectly chargeable to
Adopted 5-14-02. ae Ova. re,
the project.
} 4
Gail A. Kundinger, City Glerk
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