Loading...
05/10/1983 - City Council SpecialSPECIAL CITY COUNCIL MEETING MAY 10, 1983 7:00 P.M. EAGAN CITY HALL I. ROLL CALL II. JAMES HORNE STORM SEWER ASSESSMENT/PROJECT 10R III. WATER TREATMENT FACILITY BIDS IV. OTHER BUSINESS V. ADJOURNMENT MEMO TO: HONORABLE MAYOR AND CITY COUNCILMEMBERS FROM: CITY ADMINISTRATOR HEDGES DATE: MAY 6, 1983 SUBJECT: SPECIAL CITY COUNCIL MEETING - MAY 10, 1983 The following items are to be considered at the Special City Coun- cil meeting on May 10, 1983 at 7:00 P.M. at the Eagan City Hall. JAMES HORNE STORM SEWER ASSESSMENT/PROJECT 197R The City staff has prepared data regarding the storm sewer assess- ment from James Horne for his property.. This storm sewer assess- ment relates to Project 197R. Enclosed is a copy of the report that has been prepared by City staff which includes the appraisal of the property, also an agenda from the City Attorney's Office and finally an 8 -page letter from Mr. Horne's attorney, Bruce Mal- kerson addressing the Horne's storm sewer assessment issue. Also enclosed are a copy of the November 9, 1982 letter from Mr. & Mrs. Horne which is their original letter .of objection,'a list of writ- ten objections received for Project 297R, and a letter to Mr. Horne from Thomas A. Colbert dated February 22, 1983 summarizing the events prior to that date. The City Attorney will be guiding the meeting with testimony and any other input that is expected on Tuesday. WATER TREATMENT FACILITY BIDS The water treatment facility bids were received at 10:30 A.M. on Friday, May 6, 1983. The engineer's estimate is $4,400,000.00 and the low bidder was'Barbarossa & Sons, Inc. in the amount of $3,539,500.00. The bid was exceptional and will certainly reduce the cost of the total project substantially. Enclosed is a bid tabulation sheet prepared by the Engineering Department. OTHER BUSINESS The Director of Public Works is planning to discuss the concrete curb vs. bituminous curbing issue at the special City Council meeting. Also, the City Administrator would like a few minutes to discuss evaluation of the'City Planner which is a partial con- clusion of that personnel analysis conducted during the last sev- eral months. Respectfully submitted, Thomas L. Hedges City Administrator TLH/jack HAUGE, SMITH, E1DF. HELLER, P. A. ATTORNEYS AT LAW CEDARVALE PROFESSIONAL BUILDINGS BBOB SIBLEY MEMORIAL HIGHWAY EAGAN, MINNESOTA 83122 PAUL H. HAUGE BRADLEY SMITH KEVIN W EIDE DAVID 0. KELLER Bruce Malkerson Attorney at Law 4344 IDS Center Minneapolis, MN 55402 May 6, 1983 RE: City of Eagan Project 0297R - James Horne Dear Bruce: .AREA CODE 612 TELEPHONE 484.4224 On May 3, 1983 you called our office and indicated that as the attorney for Jim Horne concerning the objections that were filed by him regarding Project #297R relating to the Blackhawk Lake storm sewer trunk, that your appraiser would not be able to complete his appraisals in time for the hearing scheduled, on the objections by the Eagan City Council, for May 10,. 1983. On March 31 , 1983, I sent a letter to you indicating that the hearing would be scheduled for May 10 at the City Hall and asked for an acknowledgment from you for that date. To the best of my knowledge, you did not acknowledge the date, but we have proceeded on that basis and there has been discussion from time to time that that would be. the continued date for the hearing. In addition, this hearing date has been rescheduled several times to Mr. Horne's and your re- quest. and the Council has now scheduled that evening, and intends to proceed with the hearing on that date. I had asked that you forward a copy of your appraisal to me before the hearing so that I would be able to review it. I am enclosing a Memorandum that I have dictated for the City Council which out- lines the general format that the Eagan City Council follows in hearings of this nature. I called you on May 4 and indicated that the City Council intends to proceed with the ,hearing and at that time, you indicated you were uncertain whether you'd be present on May 10, but would let me know whether you intend, to be present at the scheduled hearing time. To the best of my knowledge,we have had no correspondence from either you or Mr. Horne, other than .the written objections that were filed in November of 1982 concerning the assessments and it is the opinion of the Council that it must proceed because of the many delays that have taken place at the request of Mr. Horne. PHH:ras Enclosure P.A. P. S. I have just received your letter dated May 5 and I did not say that the Council had discussed the continuance on May 3. MEMORANDUM TO: EAGAN CITY COUNCIL FROM: PAUL H. HAUGE RE: IMPROVEMENT PROJECT #2978 - JAMES HORNE ASSESSMENT APPEAL DATE: MAY 6, 1983 The hearing before the City Council concerning the objections that were filed by James Horne and Horne Development Corporation covering assessments, relating to the Horne property on Pilot Knob Road, is scheduled to be heard before the City Council at 7:00 - 7:30 on Tuesday, May 10, 1983. The Council is aware that this hearing has been delayed several times at the request of the owner and that the City staff has forwarded letters to Mr. Horne and to his attorney, Bruce Malkerson, indicating the hearing will be held on May 10, 1983. Mr. Malkerson called our office on May 3, 1983 and stated that he would not be ready for the hearing on May 10, and again requested a continuance until some time in June. He stated that his appraiser would not be ready for the hearing on May 10. On May 4 we called Mr. Malkerson and indicated that the City Council intends to proceed on May 10 and he then indicated that he may not be present and also objected to the procedure that the Council is following when objections are raised by property owners to assessments levied against their property. The Council is also aware that the procedure that began approximately two years ago by the Council, when an objection is filed in writing by a property owner at or before an assessment hearing, that the Council then continues the hearing relating to that specific assessment and schedules the continued 1 hearing before the City Council at which time the City and the property owner is permitted to submit testimony concerning the project, and the assessments levied against the specific parcel. It is also the intent of the City that in the event the property owner appeals the City Council's decision to the District Court, that the City will then request that the Court will not hold a denovo or an entirely new hearing on the assessment appeal but rather accept the proceedings before the Council, and the Judge then would be requested to review the proceedings and determine whether the assessments levied comply with the state law. Because we are uncertain at this time whether Mr. Horne or his attorney will appear before the City Council, we are recommending that the Council go through with the hearing and hear testimony from the City and from the property owner in the event that he is present and make its decision as it has done in the past when objections have been filed in a similar fashion. Therefore, we would suggest the following procedure: 1. The hearing be held on May 10, 1983 and all testimony would be submitted at that time. 2. If additional testimony is permitted by the Council, it could then continue the hearing until a later date and allow such testimony and written information be submitted. 3. If the hearing is not continued, the Council would then leave the record open for additional written evidence for twenty (20) days from the close of the hearing. 4. The Council will consider written motions to reopen hearings or to extend time limitations for good cause shown. 5. Any landowner may submit briefs and proposed findings of fact, conclusions and orders as to any parcel at any time before 40 days from the close of the hearing on that parcel. The City staff will also be required to 2 submit their proposed findings and briefs within 40 days. 6. Following receipt of the proposed findings, conclusions and order, the Council will enter its Findings, Conclusions and Order and act on the assessment roll. The basis for the landowner's objections are that the property is not benefitted by the storm sewer project in the amount of $43,591.41 which was the initial amount of the assessment, and has not been benefitted in any amount and that the proposed assessment is otherwise unlawful and contrary to law. 3 PAUL H. HAUGE BRADLEY SMITH KEVIN W. EIDE DAVID O. KELLER Mr. Bruce Malkerson Attorney at Law 4344 IDS Center Minneapolis, MN 55402 HAUGE, SMITH, EIDE & $ELLER, P. A. ATTORNEYS AT LAW CEDARVALE PROFESSIONAL BUILOINOB 2808 SIBLEY MEMORIAL HIGHWAY EAGAN (ST. PAUL). MINNESOTA 00122 March 31, 1983 RE: James Horne Storm Sewer Assessment - City of Eagan .Z Y? 2 Dear Bruce: Anew COD[ 012 TeLePHCNe 40A.4224 You called on March 24 and indicated that you had been retained by Jim Horne as attorney concerning the objections that he has filed relating to the Blackhawk Lake storm sewer assessments covering the Horne property in Eagan. At that time you asked that the City Council allow Mr. Horne to acquire an appraiser to prepare an appraisal covering the benefit to the property. You also stated that Barr Engineer- ing has been hired by Mr. Horne for engineering purposes on the project and that Barr Engineering would be ready to proceed at the regularly scheduled hearing scheduled for March 29, 1983, at the City Hall, but that the appraiser would not be ready. I have now discussed this issue with City Administrator Tom Hedges and Public Works Director Tom Colbert and the City Council, at a March 29 meeting decided that the hearing regarding'the storm sewer assessments will be rescheduled to Tuesday, May 10, 1983, at 7:30 p.m. at the Eagan City Hall. Because there have been a number of delays in the hearing and objections raised by Mr. Horne, the staff insists that either you on behalf of Mr. Horne or Mr. Horne consent to the holding of the hear- ing on May 10 so that no further delays will take place. No further continuances will be granted. I would also ask that you arrange for the signature of a copy,of this letter to be returned to me so that we have written consent for the change of date. It would also be expected that any testimony that is to be submitted on behalf of Mr. Horne will be ready that evening including the engineer and appraiser, and that any reports or appraisals will be furnished to us prior to the hearing as soon as they are avail- able. If there are any questions about the information in this letter, please get back to me immediately. cc: Robert Rosene Thomas L. Hedges ;rhomas A. Colbert Daniel E. Dwyer Very truly yours, Paul H. Hauge, City Attorney, City of Eagan I HEREBY CONSENT TO THE HEARING DATE OF MAY 10, 1983 AS DESCRIBED ABOVE. James Horne November 9, 1982 Hon. Bea Blomquist and City Council City of Eagan Eagan, Minnesota Re: Objection to Proposed Assessment for Storm Sewer Project 297 2=--7 .,Dear, Mayor Blomquist...and Members of.the ,City Council: Objection is herewith made to the City Council of the City of Eagan to the proposed assessment for storm sewer and/or storm sewer outlets to BlackhawkLake and Highway 13 (Project 297) against our property. The total proposed assessment is approxi- mately $43,591.41 and the basis of the objection is that said property is not benefited by said storm sewer project in that amount or in any amount, and that the proposed assessment is otherwise unlawful and contrary to law. \fq_g HORNE DEVELOPMENT CORPORATION By: resides t and orne LU -OG taiww HSSESSNIM ti":APLL%/'L1SI of WRIT EN OBJECTIONS RECEIVED PRa,TBC.'T �` x7 - AREA ASSESSMENT RATE DATE OF GROSS CREDITS I NET P ,AL, awNER CLASSIFICATION AMP -OF ASSMT WRITTEN OBJ REASONS SE7CTION 16 Harry/Pearl 10-01600-010-05 Lemieux 10.0ac 2.0 ac 8.0 ac Agricultural $11,848.00 7 2� No Benefit 8-12-92 10-01600-010-50 Henry Englert 40.Oac 8.0 ac 32.0 ac Agricultural 47,393.28 7-20-82 Sr. Citi 10-01600-030-79 Idn. Bruestle NA NA 1.15 ac SF large lot 645.00. 7-27-82 1 tklj S ?^100D ADD16,400 P.H. Notic Lot 1, Block 1 Horne Dev.Corp NA NA S.F., SF 557.60 7-20_-82 s No Benefit ,� -Lot 2, Block 1 - J " NA NA S.F. SF - 474.67 1111- i " NA NA 13,910 S.F. " 472.94 " Lot 3, Block 1 - — Lot 4- Block 1 „ NA NA 13,536 S.F. 460.22 „ " Lot 5, Block 1 NA � 14,536 S.F. 1111 444.22 11 — - - Lot 6, Block r �.16,054 NA NA S.F. 1. 545.84 11 Lot 7, Block 1 ,,,_,t7, -- - ---- - Jaynes/Arvella NA NA 16,500 S.F. 561.00 " Horne ' J NA NA 16,500 S.F. 15,000 S.F. SF1.00 " Lot 8, Block 1 ----- - 'Lot 9, Block_1.1 - ' " NA NA 510.00 " Lot 10, Block 1 j " NA NA 15 S. F. " 534.75 -Lot -12 (Ouf1: 1) _ � NA � _F. 85, 500 - S.F. Sr - 2,907.n0 „ %Lot 13 (Out1.2) _ 1 " NA 13,000 --- SF 442.00 " `- - --- NA S.F. -Lot 14 (Outl. 3)_ --- - + " NA 94,500 S.F. Sr 3,213.On SEX'TION 21 " r10 -02100-010=0T Horne �� 27.59 6,22Ac 21.37ac Agricultural 31,857.17 " 10-02100-010-02 David Ashfeld 16.59Pc 3.32Ac 13.27ac Agricultural 19,652.0011AnUtmt Excessive 10-02100-012-2 .Ieo_PIluphY . NA = NA "' 31.18ac r Agricultural rt • '' ', 46,177.0 - 7-13-82 (feePWRIt gel rl.t.. 1.1 c 42� Ac Agn tur 0,727.0 ' f>r7�-p' �eo.*buc� er+.. tm Im 1.49 AC SF large lot 838.00 7-14-R2 Gr.(i ti pan of 3795 PILOT KNOB ROAD, P.O. BOX 21199 EAGAN. MINNESOTA 55121 PHONE: (612) 454-8100 February 22, 1983 MR JAMES B HORNE 3850 CORONATION RD EAGAN MN 55122 BEA BLOMQUST Mayan THOMAS EGAN JAMES A SMITH JERRY THOMAS THEODORE WACHTER Oa d Ma $ THOMAS HEDGES CNAam gala EUGENE VAN OVEMEKE Ory Cbn Re: Project 297R - Final Assessment Appeal/Special Hearing King's Wood Addition and Parcel No. 10-02100-010-01 I would like to take this opportunity to summarize the events that have taken place to date regarding the final assessment for trunk area storm sewer as it affects the above -referenced parcels. JULY 20, 1982 Final assessment hearing was held for Project 297 for the trunk area storm sewer assessments associated with the trunk storm sewer outlet from Blackhawk Lake to the Minnesota River. A written ob- jection was received from you pertaining to the final assessment based on the fact that you did not receive notification of the pub- lic hearing for this project which was held on May 20, 1980. Based on your written objection, the City Council continued the final assessment hearing pertaining to your parcels to September 7, 1982 and directed your specific concern to be addressed by the Special Assessment Committee on August 30, 1982. AUGUST 30, 1982 At a Special Assessment Committee meeting held at City Hall, your written objection was reviewed in detail. In realization of the fact that you were inadvertently omitted from the original public hearing notification for Project 297, the Special Assessment Commit- tee forwarded a recommendation to the City Council that you be re- moved from the final assessment roll for Project 297 and that a new project be initiated to follow the proper procedures of notifi- cation. SEPTEMBER 7, 1982 Upon recommendation of the Special Assessment Committee, the City Council formally closed the public hearing pertaining to the final assessments for Project 297 that was originally held on July 20, 1982. They also abandoned the final assessments for Project 297 as it pertains to the above -referenced parcels under your ownership with the direction that a new project be established (Project 297R) with a public hearing for this new project to be held on October 5, THE LONE OAK TREE... THE SYMBOL OF STRENGTH AND GROWTH IN OUR COMMUNITY Mr. James B. Horne Project 297R February 22, 1983 Page two 1982. OCTOBER 5, 1982 The formal public hearing was convened after notifications were sent to all affected property owners and published in the legal newspapers for Project 297R. At this meeting, the details of the project were discussed and the benefited properties associated with the Blackhawk Lake storm sewer outlet were discussed in detail. Although objections were made by you in relationship to this project, the public hearing was closed and Project 297R was approved with the final assessment hearing scheduled for November 9, 1982. NOVEMBER 9, 1982 After individual notices were sent to the affected property owners and published in the legal newspaper, the final assessment hearing was held for Project 297R. Based on written objections submitted by you pertaining to the above -referenced parcels, this final assessment hearing was continued until December 21, 1982. DECEMBER 21, 1982 Continued public hearing for the final assessments for Project 297R was convened and the City Council directed that the City hire an ap- praiser to determine the benefit associated with the trunk area storm sewer assessments and that the final assessment hearing be continued until March 1, 1983 with the understanding that if there is insuffi- cient time allowed on.that Council agenda that it be continued until another special Council meeting date. FEBRUARY 1, 1983 Because of the anticipated length of the schedule for March 1, 1983, the City Council formally rescheduled the continued final assessment hearing from March 1, 1983 to a Special City Council meeting to be held at 7:00 P.M. on Tuesday, March 29, 1983 at the Eagan City Hall. This letter then is to give you formal notification of this scheduled special City Council meeting to be held on March 29, 1983 to discuss the objections pertaining to the trunk area storm sewer assessments associated with Project 2978. The City will have completed a formal appraisal of the property in question and will be presenting engineer- ing, property appraisal and legal testimony pertaining to the justifi- cation of this trunk area storm sewer assessment at this meeting. It is strongly recommended that you arrange to have the proper repre- sentation to present and verify your position of objection pertaining to inclusion in this special assessment project. Mr. James B. Horne Project 297R February 22, 1983 _ Page three Based on the input presented by the staff on behalf of the City and the property owner, this special committee "of the whole" of the City Council will then make a formal determination pertaining to the final assessments for Project 297R as it pertains to the above -referenced parcels. This letter is being sent to your attention to allow you adequate time to prepare your presentation. Please feel free to contact me if you would like additional information pertaining to the procedure to be followed during this Special City Council meeting on March 29, 1983. Sincerely, homas A. Colbert, P.E. Director of Public Works TAC/jach cc - Paul Hauge, City Attorney WAYNE G. POPHAM RAYMOND A. HAIK ROGER W. SCHNOBRICH DENVER KAOFMAN DAVID S. DOTY ROBERT A. MINISH ROLFE A. WORDEN G. MARC WHITEHEAD BRUCE D. WILLIS FREDERICK S. RICHARDS G.ROBERTJOHNSON GARY R. MACOMBER ROBERT S. BURK HUGH V PLUNKETT. POPHAM, HAIK, SCHNOBRICH, KAUFMAN & DOTY, LTD. 4344 IDS CENTER MINNEAPOLIS, MINNESOTA 55402 TELEPHONE AND TELECOPIER 612-333-4600 FREDERICK C. BROWN THOMAS K. BERG BRUCE D. MALKERSON JAMES R. 5TEILEN JAMES B. LOCKHART ALLEN W. HINDERAKER CLIFFORD M. GREENE D. WILLIAM KAUFMAN OESYL L. PETERSON MICHAEL O. FREEMAN THOMAS C. D'AOUILA LARRY D. ESPEL JANIE S. MAYERON DAVID A. JONES Mayor and City Council City of Eagan 2795 Pilot Knob Road Eagan, MN 55122 LEE E.SHEEHY LESLIE GILLETTE MICHAEL T. NILAN ROBERT C. MOILA.NEN DAVID J. EDOUIST CATHERINE A. POLASKY STEVEN G. HEIKENS THOMAS J. RADIO KATHLEEN M. MARTIN JOHN C. CHILDS THERESE AMBRUSKO DOUGLAS P SEATON GARY D. BLACKFORD SCOTT E. RICHTER May 5, 1983 Re: Horne Storm Sewer Assessment Dear Mayor and City Council: I. OVERVIEW 2560 PETRO-LEWIS TOWER - TIJ SEVENTEENTH STREET DENVER, COLORADO 80202 TELEPHONE AND TELECOPIER 303-025-2660 SUITE 802-2000 L STREET N. W. WASHINGTON, D. C. 20036 TELEPHONE AND TELECOPIER 202-887-51 S 4 This office represents Mr. and Mrs. James B. Horne and their company, Horne Development Corporation, who are the owners of Lots 1-10 and outlots 1, 2 and 3, King's Wood Addition and Parcel #10-02100-010-01, City of Eagan, Minnesota. The City staff has proposed in their assessment roll for Storm Sewer Project #197R to assess this property and perhaps the other property owned by my clients (hereinafter "Horne property") in the amount of approximately $40,000 to $60,000 depending on final land use. II. REQUEST FOR CONTINUANCE The City has previously continued the public hearing on the proposed assessment against the Horne property to May 101 1983, so that my clients would have an opportunity to retain an appraiser to present evidence concerning the special benefit, if any, to the Horne property. On May 3, 1983, I informed Mr. Brad Smith, one of the City's attorneys, that the Horne's appraiser, Mr. Tom Metzen, would not be able to complete the appraisal assessment by May 10, May 5, 1983 Page 2 1983, because of his conflicts with various court appearances. I asked that the hearing be continued to June, 1983 so -that the Hornes would have the benefit of having their appraiser present. I reminded him that the City is the party who controls these deadlines so that the City can always modify them to suit its needs; the City should be willing to do the same for the property owner, especially since there is no need to adopt and certify any special assessment until October, 1983, since no assessment adopted in 1983 can be certified for collection on taxes any earlier than those taxes payable in 1984. Therefore, it makes no difference to the City when the assessment is adopted as long as it is before October, 1983. I called him again several minutes later and suggested several days in June when my clients would be in town. He said he would review my request with City staff and get back to me. On May 4, 1983, he called and left a message that the hearing would not be continued. I then spoke with the City Attorney, Paul Hauge, who informed me that the City Council reviewed this request on Tuesday, May 5, 1983, and voted to deny it. I objected to Mr. Hauge that such a denial, denied my clients' procedural due process for the reasons noted above and because no one informed me or my clients that this request would be discussed at a Council meeting. Had I known of that fact, I would have been present to state the reasons why this request should be granted. It is not too late to remedy this denial of procedural due process. Each of you can call the City Manager individually and instruct him to continue the hearing or to tell him that you will not be present. There will then be no quorum, and therefore no meeting. The City Manager and the City Attorney could then inform me. The Council could reset the hearing at its next Council meeting. If there is to be litigation concerning this special assessment, why expose the City and yourselves to yet another claim for denial of procedural due process? III. GENERAL OBJECTIONS TO PROPOSED SPECIAL ASSESSMENTS Our clients have directed us to enter written objections on their behalf to the proposed special assessments, pursuant to Minn. Stat. § 429.061, subd. 1. This letter constitutes those May 5, 1983 Page 3 objections to be made part of the public record in this matter as they relate to the property described above or any other property owned by my clients which may be subject to this or any other related special assessment. Based on the facts we have presently available to us, the objections include, but are not limited to the following: 1. The assessments exceed the special benefits to the property. There is no special benefit to the property. 2. The special assessments constitute a taking of property without compensation in violation of the State and U.S. Constitutions and 42 U.S.C. §1983. 3. The City has not followed the procedural requirements of Minn. Stat. § 429.01, et seq. 4. The assessment formula used by the City is arbitrary and unreasonable. 5. The problem, if any, sought to be corrected is one of a general nature and should be funded by general revenues. 6. The problem, if any, sought to be corrected was created by the City and should be corrected and paid for by the City. 7. Certain areas have been exlucded from assessment which should be included. 8. Because previously existing storm sewers, both natural and man-made, serving the property were adequate, no special assessment can now be made for new storm sewer. The above general objections do not limit the other potential objections which may be made based upon further inquiry. IV. APPLICABLE LEGAL PRINCIPLES It is my opinion that the proposed special assessment against my clients' property is not legal and will not be sustained by the court on review. In Carlson-Lanq Realty Co. v. City of Windom, 307 Minry. 368, 369, 240 N.W.2d 517, 519 (1976), the Minnesota Supreme Court reaffirmed the following limitations on the power of the City to levy a special assessment: ' May 5, 1983 Page 4 (a) The land must receive a special benefit from the improvement being constructed, (b) the assessment must be uniform upon the same class of property, and (c) the assessment may not exceed the special benefit. . . . Special benefit is measured by the increase in the market value of the land owing to the improvement. Quality Homes, Inc. v. Village of New Brighton, 289 Minn. 274, 183 N.W.2d 555 (1971) . . . . Any special assessment which does not meet these requirements is an unconstitutional taking without compensation. In re Improvement of Superior Street, Duluth, 172 Minn. 554, 559, 216 N.W. 318, 320 (1927). The construction of this storm sewer project was undertaken to solve the drainage problems of areas in the City which do not even receive the surface water runoff from my clients' property. The City has artificially collected, redirected and deposited water from outside the subwatershed which includes my clients' property and then discharged that water on to my clients' and their neighbors' property. There was no problem with the surface water runoff from my clients' property. My clients had more than ample water storage area on their property for any development of their property or property in their subwatershed. Only because the City chose to collect and discharge other water on my clients' property, was there any potential need for the outlet pipe and other downstream portions of the project. In fact, had the City not built the outlet pipe from the pond on my clients' property, the City's water would have trespassed further into their property than it does presently. For these reasons, tests (1) and (3) above are violated by the proposed special assessment. The City should have reallocated the proposed special assessment against my clients' property on those properties upstream on this project which needed the project. The City can still do so by a supplemental assessment. If the City chooses not to do so, the City should admit its mistake and pay for this portion of the project out of the general taxes. This situation is not unique for cities. In fact, the Supreme Court has recently instructed cities that many of the improvements they used to finance by special assessment mmst in the future be financed by general tax dollars: May 5, 1983 Page 5 "The legal limit on special assessments is that they may not exceed the increase in market value of the assessed property, and as a practicalmatter this means many improvements may not be fully assessed but must be funded through some other means, such as the general property taxes." Carlson -Lang Realty Company v. City of Windom, 240 This is especially true in the case of storm water projects. This approach would not set an adverse precedent for several reasons, including the following: 1. The City may assess each project in a different manner from the other projects. 2. My clients' property did not need the project except perhaps because the City collected and discharged water onto my clients' property. 3. My clients' property is all high, dry and buildable with no present or future potential drainage problems (except those the City may have created.) V. FOR THE PURPOSES OF THIS PROCEEDING, MY CLIENTS It is my understanding from Mr. Hauge that although the City does not state that this hearing is supposed to constitute a fair and impartial contested case type hearing, the City may so argue if an appeal is filed. I believe that the City may be trying to bring its procedure within the parameters of a procedure suggested by the Court in the case of Buettner v. City of St. Cloud, 277 N.W.2d 199 (1979), in which the Court stated: "Similarly, if the St. Cloud City Council had instituted an adversary proceeding before an impartial referee and made findings on the specific issue of special benefits, there would be reason for judicial review to be more limited. But that is not the case. Apparently the City Council here initially made no findings whatsoever of special benefits; even were it otherwise its status as an interested party would, without procedural protection, still make the 4etermination suspect." 227 N.W.2d 204. May 5, 1983 Page 6 obviously the hearing on May lo, 1983, does not even begin to meet the above tests for several reasons: 1. The Council is an interested party. 2. There is no independent disinterested party acting as a decision -maker. 3. The City has refused to grant a continuance. 4. The City never ordered an appraisal to justify the proposed assessment until after it knew there was an objection. 5. The special assessment as proposed, in fact, already appears in the tax statements. VI. LIMITED REVIEW OF CITY'S APPRAISAL Our Expert has not had a sufficient amount of time to prepare his appraisal or to advise me and my clients of the deficiencies in the City's appraisal. We, therefore, reserve full comment until a possible later forum or to the date of a continued hearing. However, the fundamental weakness of the City's appraisal remains as follows: 1. Prior to the City's project, none of my clients' property had any existing or potential drainage problems regardless of the manner in which it might be reasonably developed. All of the property is high, dry and buildable except for the ponding area on the property which my clients would retain and use. Therefore, there can be no increase in value to the property. This, of course, is especially true for all the property which is above the ordinary high water elevation of the pond. This project has not resulted in any more land being useable than existed before. 2. The only potential water problem for my clients' property was created by the City which trespassed over my clients' property by discharging water onto it. My clients cannot be forced to pay for a potential problem created by the City. - May 5, 1983 Page 7 VII. SUMMARY I am sure that the City's witnesses will develop some type of response to the objections raised herein. I assume they believe they are paid to be advocates for the City, which is unfortunate and contrary to the law. The City staff and elected officials have the affirmative duty to be neutral, to protect my clients' constitutional rights, not to find ways to circumvent them or obscure them, even if that type of action pleases the Council. I fully expect that the City staff and Council have already made up their minds to adopt the special assessment as proposed for several reasons: 1. You always assume that the city is right and the property owner is wrong. 2. Mr Horne has not enjoyed the best working relationship with the City in the past. 3. The City has, in fact, already levied the proposed special assessment and it, in fact, shows up on my clients' tax statements. 4. The City would rather adopt the higher special assessment and then see if the Court will reduce the higher special assessment. A city frequently takes the position that if the special assessment is high when adopted, a court reduction or settlement will still result in a higher assessment than would occur if the City adopted a more reasonable special assessment. The fallacy in this approach is that it forces the property owner to appeal, seek damages and most importantly, the City officals have an affirmative duty not to deny constitutional rights of property owners regardless of the financial consequences to the City. The City believes that any property which contributes water to the project should be assessed even though the property had no existing or potential drainage problems. We sincerely hope that the City and its elected officials will reconsider the special assessments proposed for this property. We are willing to meet with the City staff -and/or one May 5, 1983 Page 8 or more Councilmembers to review the proposed assessment roll if the City Council tables any action on this proposed assessment. There is ample time to table the roll and still adopt it prior to October, 1983. We wish to work with the City in achieving a satisfactory solution to the problems and objections we have raised. If the assessment roll is adopted as proposed, my clients will undoubtedly file an appeal in Dakota County District Court and/or in Federal Court to set aside the special assessments and to collect their costs and attorney's fees. Because any special assessment adopted in excess of the special benefit constitutes a denial of their constitutional rights, my clients may also seek punitive damages against the City and the Councilmembers voting for the assessment. This statement is made as a matter of courtesy and to place you on notice of intent, not as a threat. We wish to work with the City and not against it. However, we have found that most city councils prefer to adopt an assessment roll as proposed by City staff and then let the City Attorney defend it in court later. The Minnesota Supreme Court has stated that cities must be more willing to admit that some projects must be paid for by general taxes and not by special assessments; this project as it affects my clients' property certainly is of that nature. This letter may offend some readers. It is not meant to do SO. I only want to remind you of the unfortunate realities of this procedure and to ask you to put yourself in the position of my clients. Would you accept this assessment as being fair and lawful? Do you believe your property in this situation would really be specially benefitted proven by actual increase in value? Would you be willing to pay $60,000 to the City today? I do not believe so. I hope you will ask yourself those questions, answer them honestly and then vote to delete the special assessment or reduce it to a minimum amount to reflect the fact that only a very small area next to the pond could possibly be benefitted under anyone's theory of benefit. very truly yours, Bruce D. Malkerson BDM/jf cc: City Clerk City Manager City Attorney Mr. and Mrs. Horne 2422j 1. 2 3 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 4724b Our File No. 49230 WATER TREATMENT FACILITY CITY CONTRACT 83-01 PROJECT NO, 338 EAGAN, MINNESOTA BID TIME: 10:30 A.M., C.D.S.T. BID DATE: Friday, May 6, 1983 CONTRACTORS Barbarossa & Sons Inc-. Knutson Construction Co. Loeffel-Engstrand Co. P.C.L. Construction Gridor Construction Inc. Orville E. Madsen & Sons, Inc. Adolfson & Peterson, Inc. Acton Construction Co. Johnson Building Company Steenberg -Henkel Construction Co. Young Construction Co. M. A. Mortenson Oscar J. Boldt Construction Grudem Brothers, Inc. Encon Utilities Inc. ENGINEER'S ESTIMATE ------------ Feasibility Report (F.R.)--- Low Bid -------------------- % over (+) or under (-) F.R. TOTAL BASE BID $3,539,500.00 3,597,000.00 3,659,000.00 3,674,000.00 3.796,000.00 3.837.000.00 3.896.700.00 1-954.400.00 3.966.000.00 4,n4a 1S2_nn 4,091,838.00 4.219,700.00 4.326.000.00 NO BID NO BID $4,400,000 4,717,000 3,539,500 -24.96% SPECIAL CITY COUNCIL MEETING MAY 10, 1983 7:00 P.M. EAGAN CITY HALL I. ROLL CALL II. JAMES HORNE STORM SEWER ASSESSMENT/PROJECT 10R III. WATER TREATMENT FACILITY BIDS IV. OTHER BUSINESS V. ADJOURNMENT MEMO TO: HONORABLE MAYOR AND CITY COUNCILMEMBERS FROM: CITY ADMINISTRATOR HEDGES DATE: MAY 6, 1983 SUBJECT: SPECIAL CITY COUNCIL MEETING - MAY 10, 1983 The following items are to be considered at the Special City Coun- cil meeting on May 10, 1983 at 7:00 P.M. at the Eagan City Hall. JAMES HORNE STORM SEWER ASSESSMENT/PROJECT 197R The City staff has prepared data regarding the storm sewer assess- ment from James Horne for his property.. This storm sewer assess- ment relates to Project 197R. Enclosed is a copy of the report that has been prepared by City staff which includes the appraisal of the property, also an agenda from the City Attorney's Office and finally an 8 -page letter from Mr. Horne's attorney, Bruce Mal- kerson addressing the Horne's storm sewer assessment issue. Also enclosed are a copy of the November 9, 1982 letter from Mr. & Mrs. Horne which is their original letter .of objection,'a list of writ- ten objections received for Project 297R, and a letter to Mr. Horne from Thomas A. Colbert dated February 22, 1983 summarizing the events prior to that date. The City Attorney will be guiding the meeting with testimony and any other input that is expected on Tuesday. WATER TREATMENT FACILITY BIDS The water treatment facility bids were received at 10:30 A.M. on Friday, May 6, 1983. The engineer's estimate is $4,400,000.00 and the low bidder was'Barbarossa & Sons, Inc. in the amount of $3,539,500.00. The bid was exceptional and will certainly reduce the cost of the total project substantially. Enclosed is a bid tabulation sheet prepared by the Engineering Department. OTHER BUSINESS The Director of Public Works is planning to discuss the concrete curb vs. bituminous curbing issue at the special City Council meeting. Also, the City Administrator would like a few minutes to discuss evaluation of the'City Planner which is a partial con- clusion of that personnel analysis conducted during the last sev- eral months. Respectfully submitted, Thomas L. Hedges City Administrator TLH/jack HAUGE, SMITH, E1DF. HELLER, P. A. ATTORNEYS AT LAW CEDARVALE PROFESSIONAL BUILDINGS BBOB SIBLEY MEMORIAL HIGHWAY EAGAN, MINNESOTA 83122 PAUL H. HAUGE BRADLEY SMITH KEVIN W EIDE DAVID 0. KELLER Bruce Malkerson Attorney at Law 4344 IDS Center Minneapolis, MN 55402 May 6, 1983 RE: City of Eagan Project 0297R - James Horne Dear Bruce: .AREA CODE 612 TELEPHONE 484.4224 On May 3, 1983 you called our office and indicated that as the attorney for Jim Horne concerning the objections that were filed by him regarding Project #297R relating to the Blackhawk Lake storm sewer trunk, that your appraiser would not be able to complete his appraisals in time for the hearing scheduled, on the objections by the Eagan City Council, for May 10,. 1983. On March 31 , 1983, I sent a letter to you indicating that the hearing would be scheduled for May 10 at the City Hall and asked for an acknowledgment from you for that date. To the best of my knowledge, you did not acknowledge the date, but we have proceeded on that basis and there has been discussion from time to time that that would be. the continued date for the hearing. In addition, this hearing date has been rescheduled several times to Mr. Horne's and your re- quest. and the Council has now scheduled that evening, and intends to proceed with the hearing on that date. I had asked that you forward a copy of your appraisal to me before the hearing so that I would be able to review it. I am enclosing a Memorandum that I have dictated for the City Council which out- lines the general format that the Eagan City Council follows in hearings of this nature. I called you on May 4 and indicated that the City Council intends to proceed with the ,hearing and at that time, you indicated you were uncertain whether you'd be present on May 10, but would let me know whether you intend, to be present at the scheduled hearing time. To the best of my knowledge,we have had no correspondence from either you or Mr. Horne, other than .the written objections that were filed in November of 1982 concerning the assessments and it is the opinion of the Council that it must proceed because of the many delays that have taken place at the request of Mr. Horne. PHH:ras Enclosure P.A. P. S. I have just received your letter dated May 5 and I did not say that the Council had discussed the continuance on May 3. MEMORANDUM TO: EAGAN CITY COUNCIL FROM: PAUL H. HAUGE RE: IMPROVEMENT PROJECT #2978 - JAMES HORNE ASSESSMENT APPEAL DATE: MAY 6, 1983 The hearing before the City Council concerning the objections that were filed by James Horne and Horne Development Corporation covering assessments, relating to the Horne property on Pilot Knob Road, is scheduled to be heard before the City Council at 7:00 - 7:30 on Tuesday, May 10, 1983. The Council is aware that this hearing has been delayed several times at the request of the owner and that the City staff has forwarded letters to Mr. Horne and to his attorney, Bruce Malkerson, indicating the hearing will be held on May 10, 1983. Mr. Malkerson called our office on May 3, 1983 and stated that he would not be ready for the hearing on May 10, and again requested a continuance until some time in June. He stated that his appraiser would not be ready for the hearing on May 10. On May 4 we called Mr. Malkerson and indicated that the City Council intends to proceed on May 10 and he then indicated that he may not be present and also objected to the procedure that the Council is following when objections are raised by property owners to assessments levied against their property. The Council is also aware that the procedure that began approximately two years ago by the Council, when an objection is filed in writing by a property owner at or before an assessment hearing, that the Council then continues the hearing relating to that specific assessment and schedules the continued 1 hearing before the City Council at which time the City and the property owner is permitted to submit testimony concerning the project, and the assessments levied against the specific parcel. It is also the intent of the City that in the event the property owner appeals the City Council's decision to the District Court, that the City will then request that the Court will not hold a denovo or an entirely new hearing on the assessment appeal but rather accept the proceedings before the Council, and the Judge then would be requested to review the proceedings and determine whether the assessments levied comply with the state law. Because we are uncertain at this time whether Mr. Horne or his attorney will appear before the City Council, we are recommending that the Council go through with the hearing and hear testimony from the City and from the property owner in the event that he is present and make its decision as it has done in the past when objections have been filed in a similar fashion. Therefore, we would suggest the following procedure: 1. The hearing be held on May 10, 1983 and all testimony would be submitted at that time. 2. If additional testimony is permitted by the Council, it could then continue the hearing until a later date and allow such testimony and written information be submitted. 3. If the hearing is not continued, the Council would then leave the record open for additional written evidence for twenty (20) days from the close of the hearing. 4. The Council will consider written motions to reopen hearings or to extend time limitations for good cause shown. 5. Any landowner may submit briefs and proposed findings of fact, conclusions and orders as to any parcel at any time before 40 days from the close of the hearing on that parcel. The City staff will also be required to 2 submit their proposed findings and briefs within 40 days. 6. Following receipt of the proposed findings, conclusions and order, the Council will enter its Findings, Conclusions and Order and act on the assessment roll. The basis for the landowner's objections are that the property is not benefitted by the storm sewer project in the amount of $43,591.41 which was the initial amount of the assessment, and has not been benefitted in any amount and that the proposed assessment is otherwise unlawful and contrary to law. 3 PAUL H. HAUGE BRADLEY SMITH KEVIN W. EIDE DAVID O. KELLER Mr. Bruce Malkerson Attorney at Law 4344 IDS Center Minneapolis, MN 55402 HAUGE, SMITH, EIDE & $ELLER, P. A. ATTORNEYS AT LAW CEDARVALE PROFESSIONAL BUILOINOB 2808 SIBLEY MEMORIAL HIGHWAY EAGAN (ST. PAUL). MINNESOTA 00122 March 31, 1983 RE: James Horne Storm Sewer Assessment - City of Eagan .Z Y? 2 Dear Bruce: Anew COD[ 012 TeLePHCNe 40A.4224 You called on March 24 and indicated that you had been retained by Jim Horne as attorney concerning the objections that he has filed relating to the Blackhawk Lake storm sewer assessments covering the Horne property in Eagan. At that time you asked that the City Council allow Mr. Horne to acquire an appraiser to prepare an appraisal covering the benefit to the property. You also stated that Barr Engineer- ing has been hired by Mr. Horne for engineering purposes on the project and that Barr Engineering would be ready to proceed at the regularly scheduled hearing scheduled for March 29, 1983, at the City Hall, but that the appraiser would not be ready. I have now discussed this issue with City Administrator Tom Hedges and Public Works Director Tom Colbert and the City Council, at a March 29 meeting decided that the hearing regarding'the storm sewer assessments will be rescheduled to Tuesday, May 10, 1983, at 7:30 p.m. at the Eagan City Hall. Because there have been a number of delays in the hearing and objections raised by Mr. Horne, the staff insists that either you on behalf of Mr. Horne or Mr. Horne consent to the holding of the hear- ing on May 10 so that no further delays will take place. No further continuances will be granted. I would also ask that you arrange for the signature of a copy,of this letter to be returned to me so that we have written consent for the change of date. It would also be expected that any testimony that is to be submitted on behalf of Mr. Horne will be ready that evening including the engineer and appraiser, and that any reports or appraisals will be furnished to us prior to the hearing as soon as they are avail- able. If there are any questions about the information in this letter, please get back to me immediately. cc: Robert Rosene Thomas L. Hedges ;rhomas A. Colbert Daniel E. Dwyer Very truly yours, Paul H. Hauge, City Attorney, City of Eagan I HEREBY CONSENT TO THE HEARING DATE OF MAY 10, 1983 AS DESCRIBED ABOVE. James Horne November 9, 1982 Hon. Bea Blomquist and City Council City of Eagan Eagan, Minnesota Re: Objection to Proposed Assessment for Storm Sewer Project 297 2=--7 .,Dear, Mayor Blomquist...and Members of.the ,City Council: Objection is herewith made to the City Council of the City of Eagan to the proposed assessment for storm sewer and/or storm sewer outlets to BlackhawkLake and Highway 13 (Project 297) against our property. The total proposed assessment is approxi- mately $43,591.41 and the basis of the objection is that said property is not benefited by said storm sewer project in that amount or in any amount, and that the proposed assessment is otherwise unlawful and contrary to law. \fq_g HORNE DEVELOPMENT CORPORATION By: resides t and orne LU -OG taiww HSSESSNIM ti":APLL%/'L1SI of WRIT EN OBJECTIONS RECEIVED PRa,TBC.'T �` x7 - AREA ASSESSMENT RATE DATE OF GROSS CREDITS I NET P ,AL, awNER CLASSIFICATION AMP -OF ASSMT WRITTEN OBJ REASONS SE7CTION 16 Harry/Pearl 10-01600-010-05 Lemieux 10.0ac 2.0 ac 8.0 ac Agricultural $11,848.00 7 2� No Benefit 8-12-92 10-01600-010-50 Henry Englert 40.Oac 8.0 ac 32.0 ac Agricultural 47,393.28 7-20-82 Sr. Citi 10-01600-030-79 Idn. Bruestle NA NA 1.15 ac SF large lot 645.00. 7-27-82 1 tklj S ?^100D ADD16,400 P.H. Notic Lot 1, Block 1 Horne Dev.Corp NA NA S.F., SF 557.60 7-20_-82 s No Benefit ,� -Lot 2, Block 1 - J " NA NA S.F. SF - 474.67 1111- i " NA NA 13,910 S.F. " 472.94 " Lot 3, Block 1 - — Lot 4- Block 1 „ NA NA 13,536 S.F. 460.22 „ " Lot 5, Block 1 NA � 14,536 S.F. 1111 444.22 11 — - - Lot 6, Block r �.16,054 NA NA S.F. 1. 545.84 11 Lot 7, Block 1 ,,,_,t7, -- - ---- - Jaynes/Arvella NA NA 16,500 S.F. 561.00 " Horne ' J NA NA 16,500 S.F. 15,000 S.F. SF1.00 " Lot 8, Block 1 ----- - 'Lot 9, Block_1.1 - ' " NA NA 510.00 " Lot 10, Block 1 j " NA NA 15 S. F. " 534.75 -Lot -12 (Ouf1: 1) _ � NA � _F. 85, 500 - S.F. Sr - 2,907.n0 „ %Lot 13 (Out1.2) _ 1 " NA 13,000 --- SF 442.00 " `- - --- NA S.F. -Lot 14 (Outl. 3)_ --- - + " NA 94,500 S.F. Sr 3,213.On SEX'TION 21 " r10 -02100-010=0T Horne �� 27.59 6,22Ac 21.37ac Agricultural 31,857.17 " 10-02100-010-02 David Ashfeld 16.59Pc 3.32Ac 13.27ac Agricultural 19,652.0011AnUtmt Excessive 10-02100-012-2 .Ieo_PIluphY . NA = NA "' 31.18ac r Agricultural rt • '' ', 46,177.0 - 7-13-82 (feePWRIt gel rl.t.. 1.1 c 42� Ac Agn tur 0,727.0 ' f>r7�-p' �eo.*buc� er+.. tm Im 1.49 AC SF large lot 838.00 7-14-R2 Gr.(i ti pan of 3795 PILOT KNOB ROAD, P.O. BOX 21199 EAGAN. MINNESOTA 55121 PHONE: (612) 454-8100 February 22, 1983 MR JAMES B HORNE 3850 CORONATION RD EAGAN MN 55122 BEA BLOMQUST Mayan THOMAS EGAN JAMES A SMITH JERRY THOMAS THEODORE WACHTER Oa d Ma $ THOMAS HEDGES CNAam gala EUGENE VAN OVEMEKE Ory Cbn Re: Project 297R - Final Assessment Appeal/Special Hearing King's Wood Addition and Parcel No. 10-02100-010-01 I would like to take this opportunity to summarize the events that have taken place to date regarding the final assessment for trunk area storm sewer as it affects the above -referenced parcels. JULY 20, 1982 Final assessment hearing was held for Project 297 for the trunk area storm sewer assessments associated with the trunk storm sewer outlet from Blackhawk Lake to the Minnesota River. A written ob- jection was received from you pertaining to the final assessment based on the fact that you did not receive notification of the pub- lic hearing for this project which was held on May 20, 1980. Based on your written objection, the City Council continued the final assessment hearing pertaining to your parcels to September 7, 1982 and directed your specific concern to be addressed by the Special Assessment Committee on August 30, 1982. AUGUST 30, 1982 At a Special Assessment Committee meeting held at City Hall, your written objection was reviewed in detail. In realization of the fact that you were inadvertently omitted from the original public hearing notification for Project 297, the Special Assessment Commit- tee forwarded a recommendation to the City Council that you be re- moved from the final assessment roll for Project 297 and that a new project be initiated to follow the proper procedures of notifi- cation. SEPTEMBER 7, 1982 Upon recommendation of the Special Assessment Committee, the City Council formally closed the public hearing pertaining to the final assessments for Project 297 that was originally held on July 20, 1982. They also abandoned the final assessments for Project 297 as it pertains to the above -referenced parcels under your ownership with the direction that a new project be established (Project 297R) with a public hearing for this new project to be held on October 5, THE LONE OAK TREE... THE SYMBOL OF STRENGTH AND GROWTH IN OUR COMMUNITY Mr. James B. Horne Project 297R February 22, 1983 Page two 1982. OCTOBER 5, 1982 The formal public hearing was convened after notifications were sent to all affected property owners and published in the legal newspapers for Project 297R. At this meeting, the details of the project were discussed and the benefited properties associated with the Blackhawk Lake storm sewer outlet were discussed in detail. Although objections were made by you in relationship to this project, the public hearing was closed and Project 297R was approved with the final assessment hearing scheduled for November 9, 1982. NOVEMBER 9, 1982 After individual notices were sent to the affected property owners and published in the legal newspaper, the final assessment hearing was held for Project 297R. Based on written objections submitted by you pertaining to the above -referenced parcels, this final assessment hearing was continued until December 21, 1982. DECEMBER 21, 1982 Continued public hearing for the final assessments for Project 297R was convened and the City Council directed that the City hire an ap- praiser to determine the benefit associated with the trunk area storm sewer assessments and that the final assessment hearing be continued until March 1, 1983 with the understanding that if there is insuffi- cient time allowed on.that Council agenda that it be continued until another special Council meeting date. FEBRUARY 1, 1983 Because of the anticipated length of the schedule for March 1, 1983, the City Council formally rescheduled the continued final assessment hearing from March 1, 1983 to a Special City Council meeting to be held at 7:00 P.M. on Tuesday, March 29, 1983 at the Eagan City Hall. This letter then is to give you formal notification of this scheduled special City Council meeting to be held on March 29, 1983 to discuss the objections pertaining to the trunk area storm sewer assessments associated with Project 2978. The City will have completed a formal appraisal of the property in question and will be presenting engineer- ing, property appraisal and legal testimony pertaining to the justifi- cation of this trunk area storm sewer assessment at this meeting. It is strongly recommended that you arrange to have the proper repre- sentation to present and verify your position of objection pertaining to inclusion in this special assessment project. Mr. James B. Horne Project 297R February 22, 1983 _ Page three Based on the input presented by the staff on behalf of the City and the property owner, this special committee "of the whole" of the City Council will then make a formal determination pertaining to the final assessments for Project 297R as it pertains to the above -referenced parcels. This letter is being sent to your attention to allow you adequate time to prepare your presentation. Please feel free to contact me if you would like additional information pertaining to the procedure to be followed during this Special City Council meeting on March 29, 1983. Sincerely, homas A. Colbert, P.E. Director of Public Works TAC/jach cc - Paul Hauge, City Attorney WAYNE G. POPHAM RAYMOND A. HAIK ROGER W. SCHNOBRICH DENVER KAOFMAN DAVID S. DOTY ROBERT A. MINISH ROLFE A. WORDEN G. MARC WHITEHEAD BRUCE D. WILLIS FREDERICK S. RICHARDS G.ROBERTJOHNSON GARY R. MACOMBER ROBERT S. BURK HUGH V PLUNKETT. POPHAM, HAIK, SCHNOBRICH, KAUFMAN & DOTY, LTD. 4344 IDS CENTER MINNEAPOLIS, MINNESOTA 55402 TELEPHONE AND TELECOPIER 612-333-4600 FREDERICK C. BROWN THOMAS K. BERG BRUCE D. MALKERSON JAMES R. 5TEILEN JAMES B. LOCKHART ALLEN W. HINDERAKER CLIFFORD M. GREENE D. WILLIAM KAUFMAN OESYL L. PETERSON MICHAEL O. FREEMAN THOMAS C. D'AOUILA LARRY D. ESPEL JANIE S. MAYERON DAVID A. JONES Mayor and City Council City of Eagan 2795 Pilot Knob Road Eagan, MN 55122 LEE E.SHEEHY LESLIE GILLETTE MICHAEL T. NILAN ROBERT C. MOILA.NEN DAVID J. EDOUIST CATHERINE A. POLASKY STEVEN G. HEIKENS THOMAS J. RADIO KATHLEEN M. MARTIN JOHN C. CHILDS THERESE AMBRUSKO DOUGLAS P SEATON GARY D. BLACKFORD SCOTT E. RICHTER May 5, 1983 Re: Horne Storm Sewer Assessment Dear Mayor and City Council: I. OVERVIEW 2560 PETRO-LEWIS TOWER - TIJ SEVENTEENTH STREET DENVER, COLORADO 80202 TELEPHONE AND TELECOPIER 303-025-2660 SUITE 802-2000 L STREET N. W. WASHINGTON, D. C. 20036 TELEPHONE AND TELECOPIER 202-887-51 S 4 This office represents Mr. and Mrs. James B. Horne and their company, Horne Development Corporation, who are the owners of Lots 1-10 and outlots 1, 2 and 3, King's Wood Addition and Parcel #10-02100-010-01, City of Eagan, Minnesota. The City staff has proposed in their assessment roll for Storm Sewer Project #197R to assess this property and perhaps the other property owned by my clients (hereinafter "Horne property") in the amount of approximately $40,000 to $60,000 depending on final land use. II. REQUEST FOR CONTINUANCE The City has previously continued the public hearing on the proposed assessment against the Horne property to May 101 1983, so that my clients would have an opportunity to retain an appraiser to present evidence concerning the special benefit, if any, to the Horne property. On May 3, 1983, I informed Mr. Brad Smith, one of the City's attorneys, that the Horne's appraiser, Mr. Tom Metzen, would not be able to complete the appraisal assessment by May 10, May 5, 1983 Page 2 1983, because of his conflicts with various court appearances. I asked that the hearing be continued to June, 1983 so -that the Hornes would have the benefit of having their appraiser present. I reminded him that the City is the party who controls these deadlines so that the City can always modify them to suit its needs; the City should be willing to do the same for the property owner, especially since there is no need to adopt and certify any special assessment until October, 1983, since no assessment adopted in 1983 can be certified for collection on taxes any earlier than those taxes payable in 1984. Therefore, it makes no difference to the City when the assessment is adopted as long as it is before October, 1983. I called him again several minutes later and suggested several days in June when my clients would be in town. He said he would review my request with City staff and get back to me. On May 4, 1983, he called and left a message that the hearing would not be continued. I then spoke with the City Attorney, Paul Hauge, who informed me that the City Council reviewed this request on Tuesday, May 5, 1983, and voted to deny it. I objected to Mr. Hauge that such a denial, denied my clients' procedural due process for the reasons noted above and because no one informed me or my clients that this request would be discussed at a Council meeting. Had I known of that fact, I would have been present to state the reasons why this request should be granted. It is not too late to remedy this denial of procedural due process. Each of you can call the City Manager individually and instruct him to continue the hearing or to tell him that you will not be present. There will then be no quorum, and therefore no meeting. The City Manager and the City Attorney could then inform me. The Council could reset the hearing at its next Council meeting. If there is to be litigation concerning this special assessment, why expose the City and yourselves to yet another claim for denial of procedural due process? III. GENERAL OBJECTIONS TO PROPOSED SPECIAL ASSESSMENTS Our clients have directed us to enter written objections on their behalf to the proposed special assessments, pursuant to Minn. Stat. § 429.061, subd. 1. This letter constitutes those May 5, 1983 Page 3 objections to be made part of the public record in this matter as they relate to the property described above or any other property owned by my clients which may be subject to this or any other related special assessment. Based on the facts we have presently available to us, the objections include, but are not limited to the following: 1. The assessments exceed the special benefits to the property. There is no special benefit to the property. 2. The special assessments constitute a taking of property without compensation in violation of the State and U.S. Constitutions and 42 U.S.C. §1983. 3. The City has not followed the procedural requirements of Minn. Stat. § 429.01, et seq. 4. The assessment formula used by the City is arbitrary and unreasonable. 5. The problem, if any, sought to be corrected is one of a general nature and should be funded by general revenues. 6. The problem, if any, sought to be corrected was created by the City and should be corrected and paid for by the City. 7. Certain areas have been exlucded from assessment which should be included. 8. Because previously existing storm sewers, both natural and man-made, serving the property were adequate, no special assessment can now be made for new storm sewer. The above general objections do not limit the other potential objections which may be made based upon further inquiry. IV. APPLICABLE LEGAL PRINCIPLES It is my opinion that the proposed special assessment against my clients' property is not legal and will not be sustained by the court on review. In Carlson-Lanq Realty Co. v. City of Windom, 307 Minry. 368, 369, 240 N.W.2d 517, 519 (1976), the Minnesota Supreme Court reaffirmed the following limitations on the power of the City to levy a special assessment: ' May 5, 1983 Page 4 (a) The land must receive a special benefit from the improvement being constructed, (b) the assessment must be uniform upon the same class of property, and (c) the assessment may not exceed the special benefit. . . . Special benefit is measured by the increase in the market value of the land owing to the improvement. Quality Homes, Inc. v. Village of New Brighton, 289 Minn. 274, 183 N.W.2d 555 (1971) . . . . Any special assessment which does not meet these requirements is an unconstitutional taking without compensation. In re Improvement of Superior Street, Duluth, 172 Minn. 554, 559, 216 N.W. 318, 320 (1927). The construction of this storm sewer project was undertaken to solve the drainage problems of areas in the City which do not even receive the surface water runoff from my clients' property. The City has artificially collected, redirected and deposited water from outside the subwatershed which includes my clients' property and then discharged that water on to my clients' and their neighbors' property. There was no problem with the surface water runoff from my clients' property. My clients had more than ample water storage area on their property for any development of their property or property in their subwatershed. Only because the City chose to collect and discharge other water on my clients' property, was there any potential need for the outlet pipe and other downstream portions of the project. In fact, had the City not built the outlet pipe from the pond on my clients' property, the City's water would have trespassed further into their property than it does presently. For these reasons, tests (1) and (3) above are violated by the proposed special assessment. The City should have reallocated the proposed special assessment against my clients' property on those properties upstream on this project which needed the project. The City can still do so by a supplemental assessment. If the City chooses not to do so, the City should admit its mistake and pay for this portion of the project out of the general taxes. This situation is not unique for cities. In fact, the Supreme Court has recently instructed cities that many of the improvements they used to finance by special assessment mmst in the future be financed by general tax dollars: May 5, 1983 Page 5 "The legal limit on special assessments is that they may not exceed the increase in market value of the assessed property, and as a practicalmatter this means many improvements may not be fully assessed but must be funded through some other means, such as the general property taxes." Carlson -Lang Realty Company v. City of Windom, 240 This is especially true in the case of storm water projects. This approach would not set an adverse precedent for several reasons, including the following: 1. The City may assess each project in a different manner from the other projects. 2. My clients' property did not need the project except perhaps because the City collected and discharged water onto my clients' property. 3. My clients' property is all high, dry and buildable with no present or future potential drainage problems (except those the City may have created.) V. FOR THE PURPOSES OF THIS PROCEEDING, MY CLIENTS It is my understanding from Mr. Hauge that although the City does not state that this hearing is supposed to constitute a fair and impartial contested case type hearing, the City may so argue if an appeal is filed. I believe that the City may be trying to bring its procedure within the parameters of a procedure suggested by the Court in the case of Buettner v. City of St. Cloud, 277 N.W.2d 199 (1979), in which the Court stated: "Similarly, if the St. Cloud City Council had instituted an adversary proceeding before an impartial referee and made findings on the specific issue of special benefits, there would be reason for judicial review to be more limited. But that is not the case. Apparently the City Council here initially made no findings whatsoever of special benefits; even were it otherwise its status as an interested party would, without procedural protection, still make the 4etermination suspect." 227 N.W.2d 204. May 5, 1983 Page 6 obviously the hearing on May lo, 1983, does not even begin to meet the above tests for several reasons: 1. The Council is an interested party. 2. There is no independent disinterested party acting as a decision -maker. 3. The City has refused to grant a continuance. 4. The City never ordered an appraisal to justify the proposed assessment until after it knew there was an objection. 5. The special assessment as proposed, in fact, already appears in the tax statements. VI. LIMITED REVIEW OF CITY'S APPRAISAL Our Expert has not had a sufficient amount of time to prepare his appraisal or to advise me and my clients of the deficiencies in the City's appraisal. We, therefore, reserve full comment until a possible later forum or to the date of a continued hearing. However, the fundamental weakness of the City's appraisal remains as follows: 1. Prior to the City's project, none of my clients' property had any existing or potential drainage problems regardless of the manner in which it might be reasonably developed. All of the property is high, dry and buildable except for the ponding area on the property which my clients would retain and use. Therefore, there can be no increase in value to the property. This, of course, is especially true for all the property which is above the ordinary high water elevation of the pond. This project has not resulted in any more land being useable than existed before. 2. The only potential water problem for my clients' property was created by the City which trespassed over my clients' property by discharging water onto it. My clients cannot be forced to pay for a potential problem created by the City. - May 5, 1983 Page 7 VII. SUMMARY I am sure that the City's witnesses will develop some type of response to the objections raised herein. I assume they believe they are paid to be advocates for the City, which is unfortunate and contrary to the law. The City staff and elected officials have the affirmative duty to be neutral, to protect my clients' constitutional rights, not to find ways to circumvent them or obscure them, even if that type of action pleases the Council. I fully expect that the City staff and Council have already made up their minds to adopt the special assessment as proposed for several reasons: 1. You always assume that the city is right and the property owner is wrong. 2. Mr Horne has not enjoyed the best working relationship with the City in the past. 3. The City has, in fact, already levied the proposed special assessment and it, in fact, shows up on my clients' tax statements. 4. The City would rather adopt the higher special assessment and then see if the Court will reduce the higher special assessment. A city frequently takes the position that if the special assessment is high when adopted, a court reduction or settlement will still result in a higher assessment than would occur if the City adopted a more reasonable special assessment. The fallacy in this approach is that it forces the property owner to appeal, seek damages and most importantly, the City officals have an affirmative duty not to deny constitutional rights of property owners regardless of the financial consequences to the City. The City believes that any property which contributes water to the project should be assessed even though the property had no existing or potential drainage problems. We sincerely hope that the City and its elected officials will reconsider the special assessments proposed for this property. We are willing to meet with the City staff -and/or one May 5, 1983 Page 8 or more Councilmembers to review the proposed assessment roll if the City Council tables any action on this proposed assessment. There is ample time to table the roll and still adopt it prior to October, 1983. We wish to work with the City in achieving a satisfactory solution to the problems and objections we have raised. If the assessment roll is adopted as proposed, my clients will undoubtedly file an appeal in Dakota County District Court and/or in Federal Court to set aside the special assessments and to collect their costs and attorney's fees. Because any special assessment adopted in excess of the special benefit constitutes a denial of their constitutional rights, my clients may also seek punitive damages against the City and the Councilmembers voting for the assessment. This statement is made as a matter of courtesy and to place you on notice of intent, not as a threat. We wish to work with the City and not against it. However, we have found that most city councils prefer to adopt an assessment roll as proposed by City staff and then let the City Attorney defend it in court later. The Minnesota Supreme Court has stated that cities must be more willing to admit that some projects must be paid for by general taxes and not by special assessments; this project as it affects my clients' property certainly is of that nature. This letter may offend some readers. It is not meant to do SO. I only want to remind you of the unfortunate realities of this procedure and to ask you to put yourself in the position of my clients. Would you accept this assessment as being fair and lawful? Do you believe your property in this situation would really be specially benefitted proven by actual increase in value? Would you be willing to pay $60,000 to the City today? I do not believe so. I hope you will ask yourself those questions, answer them honestly and then vote to delete the special assessment or reduce it to a minimum amount to reflect the fact that only a very small area next to the pond could possibly be benefitted under anyone's theory of benefit. very truly yours, Bruce D. Malkerson BDM/jf cc: City Clerk City Manager City Attorney Mr. and Mrs. Horne 2422j 1. 2 3 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 4724b Our File No. 49230 WATER TREATMENT FACILITY CITY CONTRACT 83-01 PROJECT NO, 338 EAGAN, MINNESOTA BID TIME: 10:30 A.M., C.D.S.T. BID DATE: Friday, May 6, 1983 CONTRACTORS Barbarossa & Sons Inc-. Knutson Construction Co. Loeffel-Engstrand Co. P.C.L. Construction Gridor Construction Inc. Orville E. Madsen & Sons, Inc. Adolfson & Peterson, Inc. Acton Construction Co. Johnson Building Company Steenberg -Henkel Construction Co. Young Construction Co. M. A. Mortenson Oscar J. Boldt Construction Grudem Brothers, Inc. Encon Utilities Inc. ENGINEER'S ESTIMATE ------------ Feasibility Report (F.R.)--- Low Bid -------------------- % over (+) or under (-) F.R. TOTAL BASE BID $3,539,500.00 3,597,000.00 3,659,000.00 3,674,000.00 3.796,000.00 3.837.000.00 3.896.700.00 1-954.400.00 3.966.000.00 4,n4a 1S2_nn 4,091,838.00 4.219,700.00 4.326.000.00 NO BID NO BID $4,400,000 4,717,000 3,539,500 -24.96%