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03/06/2012 - City Council Finance Committee FINANCE COMMITTEE MEETING MARCH 6, 2012 11:00 A.M. - 12:00 P.M. EAGAN ROOM AGENDA I. AGENDA ADOPTION II. LESTER BORDSEN VARIANCE & PLANNED DEVELOPMENT FEES III. CEDAR GROVE REDEVELOPMENT OPTIONS IV. OTHER BUSINESS V. ADJOURNMENT Agenda Information Memo Finance Committee Meeting March 6, 2012 II. LESTER BORDSEN VARIANCE & PLANNED DEVELOPMENT FEES ACTION TO BE CONSIDERED: To provide direction to the City Council regarding Lester Bordsen's request for fee /escrow waiver consideration. FACTS: • At the February 8, 2012 City Council Meeting, the City Council approved a rezoning to planned development and a final planned development to allow a new detached accessory structure for the Bordsen property located at 733 Bradford Place subject to a number of conditions. • Mr. Bordsen appeared at the meeting and requested that the Council waive fees associated with the planned development. The request to review the fees associated with the planned development and to make a recommendation to the Council about those fees was directed to the City's Finance Committee. • Staff has verified that the property was an exception to the subdivision that occurred around it, so it was not platted at the time of that subdivision. Further, the public County tax records as of 2 -28 -2012 show a metes and bounds description and no plat for the subject property. • Per City Ordinance, to obtain a building permit the property would need to be platted; consequently, $6,575 of Mr. Bordsen's cost estimate of $8,024.50 exists even if the building permit were to be issued without any variances or without a planned development approval. • Assuming Mr. Bordsen is not requesting relief from the City final subdivision costs (estimated at $1,050), the building permit fee (estimated at $1,500), or fees that are not controlled by the City (estimated at $4,025), that leaves a balance of $1,449.50 as the fees in question related to the variances/ planned development processes. • It has been the City policy over the years that developers /applicants should pay the costs related to their specific development as the benefiting property owners and that the general taxpayers should not be asked to support development through the property tax. The developer /applicant costs for the most part have been separated into two components as follows: 1. Fixed application fees that cover general City costs like finance, clerical, administration, etc. 2. Expenses charged to an escrow account (financed by the applicant) to pay for staff time directly spent on the application and for out of pocket costs like mailing expenses, and for other professionals such as the City Attorney, engineers, etc. • This process has generally been considered to be fair in that costs are aligned with benefit and there is no City development subsidy. Obviously, economies of scale have the potential to work against smaller developments and complicated or multiple variance applications will generally become more expensive. • The following table shows a breakdown of the City Bordsen related costs for the variance /planned development broken down between application fees and direct processing costs which are further divided between staff time and out of pocket costs. Bordsen Actual Costs to Date Direct Charges Total Application Direct Charges Covered Escrow City Fees Staff Out of Pocket Total By Escrow Balance Costs Variances 600.00 570.00 228.25 ' 798.25 300.00 (498.25) 1,398.25 Mailings 49.50 49.50 PD 450.00 142.50 228.25 r 370.75 500.00 129.25 820.75 Waived (450.00) (450.00) Total 649.50 712.50 456.50 1,169.00 800.00 (369.00) 1,818.50 City Costs 1,818.50 Bordsen Payments 1,449.50 City Deficit (369.00) • Had Mr. Bordsen not gone the route of the variance application and instead started with a planned development, he would have been charged a $350 rezoning application fee and a $350 final planned development application fee and the City would have collected a $3,000 escrow to cover staff and out of pocket costs. In addition he would have had to pay for a mailing with an outside service. • It appears the City costs are consistent with City policy and have been minimized, even with the convoluted process followed to get to this point. • If the Finance Committee desires, relief could be offered through waiving any of the City fees noted above. 3 ATTACHMENTS: • Enclosed on page 5 is a copy of the sheet presented at the meeting outing Mr. Borden's known and estimated fees to obtain a building permit per his desire. • Enclosed on page 6 is a copy of a chronological breakdown of the fees and estimates totaling the $8,024.50 as presented by Mr. Bordsen. The breakdown shows the relative costs for the land use approvals and a building permit (City), various County fees and fees charged by the private sector to facilitate the platting of property. Included in the City total of $2,499.50 is an escrow of $800 to cover City staff time and out of pocket expenses for the final plat. That may or may not turn out to be the final cost. • Enclosed on page 7 is a copy of the summarized escrow activity showing deposits and charges to the escrow account related to these applications. R9- Les and Lynne Bordsen residence, 733 Bradford place Eagan, MN. City of Eagan costs to date; 11/7/11 Application for variance $300.00 (pd) 11/7/11 Escrow deposit for variance application $300.00 (pd) 11/7/11 Variance mailings, postage $49.50 (pd) / 11/21/11 Second variance required $300.00 (pd) 12/22/12 Re- zoning to Planned Development application waved.... (450.00) 12/22/12 escrow deposit for Planned Development $500.00 (pd) Paid to Date Total $1,449.50 (pd) Platting of property estimate; City of Eagan application fee $250.00 City of Eagan Escrow deposit $800.00 r ' o Reprographics (reproduce plat mylars) $150.00 r Dakota County review adj. to County Highway (Plat Comm.) $400.00 Dakota County surveyor's office plat checking fee $700.00 Dakota County plat recording fees $75.00 FFE Surveying and Platting (private party) cost $2,700.00 Estimated Plat fee total $5,075.00 Building permit estimate $1,500.00 Estimate of total costs $8,024.50 .r 0 0 0 0 C 0 0 0 Q O O if) CFA E OO O f- C 7 O V U o o 0 . Q co U O S 0 4,-,4 O 0 .r O 0 '0 C 0 0 0 O • O 0 • O to E O (c) 1` 'CO ) Q N "01 a) N Cl) �' o 05 a) > Q 0 u � L c N Q. (/) 0 L c N a) N 0 >+ = as us O) a) O) a) co ▪ _ 0 cu d d• 0 d' 0 E H (O D7 .- 0) E o N U U a O o O o O o 0 0 0 — V 1— • CD c 'd' v LO 1— © , , r u) r m a) O O y 1T a) U) 0 0 LO ix) .= ( ai d) LL •c _ O (1) et Cl. to o (a d d ' (3 0 o 0 co 0. d V d N d 00 L E ca 0 0. 0 0 0 0 0 o 3 0 00 3 0 • , 7 coo 0 2 0 °o > °o 0O 0 ' o o 5 - ' 1A u) M to o u) c.o E , �' c0v w 0 w a ` o H r.i o o o 0 c 0 0 0 0 a) 0 - 0 (a 0 c a) • o 0 C O O 0 •, = O 0 E (a C Z' al ca o 400 0 o E oo N ca a) .` 2, .T.1 E . >o o 0.., to c co o . Qas a,nN H ca n.UF°- a ¢ a co d > .- (a C N 0 a) a) — 0 > m N 0 o > 0 a0 al a ) O as m 0 Q m U P. _ 1 •az z 'Qo o 7 m Q N a N N W C) m V z . 29-Feb-12 Escrow Costs Charged to the Escrow Cumulative Escrow Balances Collected -- Staff Attorney Variances PUD Combined Variance Application: 1 I i 7-Nov-11 30000 300.00 1 Nov/Dec (570.00) (270.00) (270.00) 12/1/2011 (436.00) (436.00) 1- 12/12/2011L (62.25) (498.25) (498.25) L12/22/2o11 500.00 500.00 500.00 - F12/28/2011 (62.25) 437.75 437.75 1/17/2012, (166.00) 271.75 271.75 January (142.50) 129.25 129.25 800.00 (712.50) (456.50) 1 (369.00) 7 Agenda Information Memo Finance Committee Meeting March 6, 2012 III. CEDAR GROVE REDEVELOPMENT OPTIONS ACTION TO BE CONSIDERED: To provide direction to staff regarding financial aspects of potential redevelopment options. FACTS: • At its meeting of January 17, 2012, the Finance Committee received an update on the financial aspects of several alternative development prospect proposals for the Cedar Grove Redevelopment District. • Since that time, staff and the EDA's development partners, Len Pratt and Jim McCaffrey have been working with the prospects to develop the options further. It would be timely to provide an update on those discussions at this time. Staff will provide a verbal update at Tuesday's meeting. ATTACHMENTS: None F