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HomeMy WebLinkAbout1999 [04] Apr 06 1 Page 3500 April 6, 1999-oi Pursuant to due call and notice thereof, the City Council for the City of St. Joseph met as the Board of Review on Tuesday, April 6, 1999 at 7:00 p.m. in the St. Joseph City Hall. Members Present: Mayor Kenneth J Hiemenz. Councilors Bob Loso, Ken Twit, Mary Niedenfuer. Deputy Clerk Judy Weyrens. City Representatives Present: Cfty Assessor Ollie Lesnick; County Assessor Bob Lindvall. Others Present: Dave Keller, Ted Duncan, Steve Streng. Mayor Hiemenz called the meeting to order and stated the purpose of the meeting is to allow property owners of the City of St. Joseph to question and comment on the proposed property valuation for 1999, collectible in the year 2000. Cfty Assessor Ollie Lesnick discussed the general increase in property values for the City of St. Joseph. Lesnick stated that as Assessor it is his responsibility to assure that property values are assessed at a minimum of ninety (90) percent of the market value. In reviewing properties, the average valuation was at 88% of the market value. Therefore, home values in St. Joseph were increased an average of seven (J) percent. Lesnick clarified the increase in values was not a blanket increase, rather an average increase. Lesnick stated that the economic trends indicate property values are increasing at a rate of five (5) to ten (10) percent per year. I County Assessor Bob Lindvall stated that while the City Council is acting as the Board of Review, all concems expressed at this meeting will be reviewed by both the Cfty and County Assessor. All property requested to be reviewed will receive confirmation of any action from Steams County. At this time the floor was opened for questions from the public. Dave Keller. 19 _4th Ave NW: PID 84-53761-000: Keller spoke in Objection'to the proposed valuation of his property. He stated that in 1998 the value was increased from $69,800 to $76,500, (or 9.6 percent), and in 1999 the value was again raised from $76,500 to $79,900, (or 4.4 percent). Keller stated that duling that time he has not improved the property and it is his opinion that homes in the area that are larger than his are assessed at a lower rate. Keller requested Lesnick review his property and adjust the value to that assigned in 1998, $76,500. Twit made a motion to recommend the Cfty Assessor in conjunction with the County Assessor, review the property owned by David Keller and submit a recommendation to the Board of Review. Ayes Hiemenz, Twit, Loso, Niedenfuer Nayes: None Motion Carried: 4:0:0 Steve Strena: Steve Streng representing the St. JoseDh Newsleader, questioned if all the homes in St. Joseph were increased in valuation and the process for determining if the value needs to be increased. Undvall stated that when determining market values a study of current sales for a one year period is used. For the perioå $l1ptltmÞltr 1ilJ'l to October 1998 there were My (50) home $ales in st. Joseph. These sales are compared against the market values assigned by the Assessor's Ofñce and a ratio of market value to market sales is determined. The state of Minnesota requires that property be valued in the mid to upper 9dh percentile,. If the valuations are not within that range, the state can increase property values to that level. 1 Jim Graeve. 619 Minnesota Street E: Graeve questioned if the formula used for determining market value considers the human factor and the maximum tax that is affordable for the residents. Undvall stated that the formula for determining market values does not include the economic Page 3501 April 6, 1999-01 conditions of the community. However, Undvall cfariñed that even though valuations are increased that does not necessarily mean that property taxes will increase. The budget approved by the City Council is the determining factor in whether or not the taxes will increase and weN as the growth a community experiences. If the budget for the year 2000 would remain the same as the budget for 1999, taxes would not increase even though individual property values have been increased. UndvaJ/ encouraged those present to be active in the budget process. 1 Gary Scramstad. Redeemino Love Lutheran Church: Pastor Gary Scramstad questioned the deadline for submitting the necessary paperwork to classify property as tax exempt and if anything can be done for the year 1999. Scramstad stated that he has received the property tax statement for 1999 and questioned if those taxes can be reduced to the tax exempt status. Lesnick stated that an application requesting tax-exempt status must be received by the County no later than August. If the deadline is missed the property will be taxed. Scramstad stated that he has completed the application and will contact the County in July to assure that the necessary paperwork has been completed. Ted Duncan. 1408 Minnesota Street E: PID 64-53733-200: Duncan expressed concem for the steady increase in property values in St. Joseph. Duncan stated that his property valuation was increased by $1,000 in 1998 and $14,700 in 1999. Duncan stated it is his opinion that he could not sell his property for the value assigned by the Assessor. Lesnick respDnded that the large increase in property value for Duncan was a result of the City providing water and sewer to his property. (No action requested by the property owner.) The following property owners submitted wIitten comments: Clarence Fischer. 126 - 6th Avenue NW: PID 64-83472-007: Fischer reqUlested the Council review his property and decrease the value assigned. His letter indicated that the properties in the neighborhood have a negative impact on his valuation and therefore, it should be decreased or minimally remain the same. Lesnick stated that the Council reviewed this property in 1998 and decreased the value. I Loso made a motion to take no action on the request of Clarence Fischer; seconded by Niedenfuer. Ayes: Hiemenz, Twit, Loso, Niedenfuer Nays: None. Motion Carried 4:0:0 Bob Heroes. Pond View Ridoe DeveloDer. Herges indicated in his letter that twenty-seven (27) undeveloped lots as well as the holding pond in Pond View Ridge Five have been assessed at developed property rates. Lesnick stated that he discussed this matter with Herges and he will review and lower the valuation of the 27 lots and the Outlot in Pond View Ridge Five. Adioum: Twit made a motion to recessth~Board of Review to April 15, 1999 at 7:00 p.m. at which time the recommendations of the City Assessor will be reviewed. The motion was seconded by Loso. Ayes: . Hiemenz, Twit, loso, Niedenfuer Nays: None. Motion Carried 4:0:0 ~k~~~ u ~eputy Clerk 1 1 I I Page 3502 April 6, 1999-02 Pursuant to due call and notice thereof, the City Council for the City of St. Joseph met in special session Tuesday, April 6, 1999 at 7:00 p.m. in the St. Joseph City Hall. Members Present: Mayor Kenneth J. Hiemenz. Councilors Bob Loso, Cory Ehlert, Ken Twit, Mary Niedenfuer. Deputy Clerk Judy Weyrens. Citv Representatives Present: Cny Engineers Joe Betendorf and Amy Schaefer; Public Works Director Dick Taufen; EDA Director Chad Carlson. Others Present: Kathy Marking, R Markling, Sylvester Prom, Joe Prom, Mike Deutz, Joe Rennie, Mike Rennie, Dorine Rennie, Jerry Hirschfeld, Dan Grovender, Don Grovender, Gene Lange, David Terwey, Brian Kalla, Mike Kíttridge, Jim Graeve, Dick Backus. Mayor Hiemenz opened the hearing and stated the purpose of the healing was to consider the making of an improvement to Joseph Street between Elm Street East and County Road 133 by constructing sanitary sewer, storm sewer, water main, and bituminous street with concrete curb and gutter, pursuant to Minnesota Statutes Sections 429.011 to 429.11. This estimated cost of the improvement is $ 855,000. Such persons as desire to be heard with reference to the proposed improvement will be heard at this meeting. City Engineer Joe Bettendorf stated the City Council and St. Joseph Economic Development Authority (EDA) have been working on developing the Industrial Park and the making of improvements to Joseph Street. In 1997 the cny Offices surveyed property owners abutting Joseph Street to determine if there was a need to extend services down Joseph Street. When the surveys were tallied it appeared that property owners were not requesting the same services. Therefore, the Cny Council authorized a feasibilny study to determine the costs. In February 1999 the City Council requested a public improvement hearing be held to determine if the project will be completed. The proposed improvement includes bituminous paving, water, sewer, storm sewer and curb and gutter. Bettendorf stated that the City Council has been reluctant in the past to construct a road without installing the utilities. Bettendorf further stated that the City is in the process of negotiating property from Borgert Products which will be necessary to construct a holding pond which will store the storm sewer. Mike Rennie questioned the total cost ofthe project and how much ofthe project costs will be assessed to abutting property owners. Bettendorf responded that the proposed cost of the project is $ 854,410 including a .' contingency, engineering, legal and ñnancing. The City has a policy whereby property owners do not have to pay oversjzing costs of utility lines. With that understanding the City will be responsible for approximately $60,000 of the project and the property owners will be responsible for the balance. Mr. Markling questioned the accuracy of the Engineer's estimate and ifthe bid received for the project is a firm bid or can be increased. Ehlert responded that in the past the Engineer's estimates have been higherihan the actual bids received. As far as the bid price, Bettendorf responded that when the City bids a project such as Joseph street, it is bid as a quantity bid. That is, speciñcations request the contractor bid the project based on unit price. As the project is completed the Engineer's ofñce reviews all quantities and assures they are accurate. Further, a contractor cannot be paid additional funds unless the City Council authorizes a change order. Markling questioned the time line for the project and if a penalty clause is part of the contract. Bettendorf responded that a contract will have a completion date and the Council has the ability to extend the completion date. Typically the City has not penalized a contractor for not Page 3503 April 6, 1999-02 completing the project as stated in the contract as the weather and availability of product can slow the project. 1 Those present questioned the proposed assessment formula and how it was determined. Bettendorf stated that he and the EDA Director have reviewed altl~maffve assessment formulas and determined the most equitable assessment formula was to charge the street assessment on front footage and the remaining items on total area acreage. Jerry Hirschfeld questioned how far South the improvements will extend and if all the property owned by MCO and Helland Backus Hirschfeld will be serviced with water and sewer. Bettendorf responded that all but two Jots will be affected by the proposed improvement. The remaining lots will be assessed at a later time. Joe Rennie questioned Bettendorf as to what type of curbing is proposed in the improvement. Bettendorf stated the curb proposed is a standard 6" curb with a drop for driveways. While bituminous curbs have been used in some areas in the past it is not recommended for the Industrial Park as they are not as durable as concrete. Doline Rennie questioned the value of land after the improvements have been completed and if the property will be affordable. EDA Director Carlson stated that the City Assessor was requested to determine if the property in the project area could support the project costs. In conducting the study, Lesnick compared land prices of the property on Joseph street to improved properties in Industries West, Apollo Industrial Park and Sundial Industrial Park. It was determined that after the Jots on Joseph Street are improved, they would still be below the cost of the lots in the above mentioned parks. Michael Deutz stated that in his opinion that the lot prices on Joseph Street will exceed the price of the lots that le~ Buettner is developing. Deutz questioned Cartson as to how he is going to market the lots along Joseph Street and will there be any finandal incenti1les for the property owners. Carlson stated that all development in the industrial park is eligib~~ for Tax Increment Financing provided the TIF guidelines are met Further, Carlson stated that once improved the lots will be within marl<et range of surrounding industrial parks. I Deutz stated that the property he owns is developed with storage units and he does not have a use for water and sewer. It is his opinion that the property will be taxed at a greater value than it could be sold for. Oeutz stated that the costs of the improvements to Joseph Street should be spread over the Buettner Industrial Park as well as the property abutling .Ioseph Street. Bettendorf stated that the City has received requests from property owners along Joseph Street for water and sewer services. Hiemenz concurred with Bettendorf and stated that the City has had to submit letters of intent to sefVÍce the Industrial Park with muni,~ipal services so certain land transactions could occur. Bettendorf stated that the City annually f1eceives requests to improve Joseph Street and that is what prompted the feasibility report. Brian Kalla questioned the results of the sUlVey in 1997. Bettendorf stated that the survey results were mixed and everyone had different needs. Again, the City is responding to requests of property owners to improve Joseph Street. Bettendorf stated it is his opinion that the most cost effective method to improve Joseph street is to do it in its entirety including street, curb and gutter, water, sewer and storm sewer. As far as curb and gutter versus ditches, the cost parallel The City could proceed and only construct Joseph street, but it would not make sense as the road would have to be cut to install ubTJties at a later date. Further, in reviewing the costs, the major expense of the improvement is street construction. Sy Prom expressed objection to the proposed improvement and stated that many of the businesses along Joseph Street are small businesses and cannot afford the improvement Prom 1 , I Page 3504 April 6, 1999-02 1 questioned if the Industlial Park abutting Joseph Street could be left without the improvements, allowing the small business owner to continue to operate. Further, Prom stated that he is unaware of property owners having difficulty transferring ownership of property due to the lack of municipal services. Jerry Hirschfeld questioned if the City has the ability to freeze property valuations ifthe project moves forward. This may help the smaU business owner afford the project. Twit stated that even though property valuations increase, that does not necessarily mean that the taxes will increase. It is the increase in the annual budget that increases property taxes. Twit stated that since the School District and County receives a portion ofthe property taxes this option may not be feasible. The Council agreed to contact the City Assessor for an opinion. Gene Lange expressed opposition to the project and questioned whether the property would be marketable after the assessments are certified. Further, lange stated that he uses his property to store black dirt and after the improvements it would be cost prohibitive to continue the use as such. Doline Rennie discussed the improvements of 1992. She stated that it was her understanding when DBL circulated a petition for sewer that a discount would be provided to the property owners. Bettendorf stated that in 1992, DBL Labs paid a large portion of the cost of extending sanitary sewer. In fact, that contribution is what made the sewer extension possible. In total DBL Labs paid approximately 80 percent of the project costs. I Sy Prom and Mike Dew stated that the previous survey did not include improvement costs, making it difficult to make a decision. Prom suggested the City send a survey to the property owners based on the costs presented at this meeting. Bettendorf stated that the survey results will not change. The issue at this time is should Joseph Street be improved in 1999 and if so to what degree. Mike Kittridge questioned what type of valuation increase property owners can expect after the improvements. Bettendorf responded that at this time it cannot be determined. Bettendorf stated that the City cannot determine if the costs are feasible for a business. Each property owner must complete their own business analysis. The City will be bonding for the project and property owners will have the option of paying the assessment over time. The Council has not determined the term of repayment, but it is an issue that can be discussed. David Grovendar, D & D Welding, stated that as a small business they could not afford the assessments and would like the record to indicate that D & D Welding is not in favor ofthe proposed improvement as presented. Blian Kalla stated that as an affected property owner, he would have appreciated receiving the costs before the improvement hearing. Further, he requested that in the future the Council mail anticipated costs to property owners before the night of the public improvement hearing. I Those present discussed with the Council the possibility of phasing the improvements to Joseph Street, in an attempt to make it more affordable for the property owners. The Council agreed to break the project into two options: Option One: Street, Curb and Gutter, Water, Sewer, Storm Sewer Option Two: Street and Curb and Gutter The Council agreed to m¡¡iJ a r!V,~ ?I'9PO~ _ct cost to all affected property owners based on the above options. Further:!tI~'~áili~"wlllìriclude a list of all costs, (assessable and non assessable), incurred uf!çler 811êtì ol'!iöri:' Page 3505 April 6, 1999-02 At this time Bettendorf polled those present as to whether they were in favor of the entire project or a portion thereof. The general consensus of those present was to complete only option two as indicated above. Twit made a motion to dose the public hearing at 9:50 p.m.; seconded by Loso. Ayes: Hiemenz, loso, Twit, Ehlert, Niedenfuer Nays: None. Motion Carried 5:0:0 The Council agreed to continue the discussion of the proposed improvement on May 6, 1999. At that time it will be determined if the project will be constructed and projected time tables. Adjourn: Twit made a motion to adjourn at 10:10 p.m.; seconded by Ehlert. Ayes: Hiemenz, loso, Twit, Ehlert, Niedenfuer Nays: None. Motion Carried 5:0:0 ~~ud2:z~ U Deputy Clerk 1 I 1