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WS — Item 4 <br />WORK SESSION STAFF REPORT <br />Work Session Item 4 <br />Date: Council Work Session, May 2, 2011 <br />To: City Council <br />From: Michael Grochala <br />Re: American Legion Parking <br />Background <br />The American Legion has approached the city council regarding the possibility of leasing city <br />owned property for parking. The City owns three acres adjacent to the American Legion. The <br />city land is intended for eventual commercial development. A portion of the property is <br />currently used for the community gardens. The Legion has not provided any information <br />regarding how much parking they require. The assessed market value of the 1 acre parcel <br />nearest the Legion is $91,400. The last purchase offer the city had on this parcel was $277,000 <br />per acre. <br />The first question the council should answer is whether to allow private use of city property. Use <br />of the property for parking would require installation of a parking lot meeting all requirements <br />including paving, curb and gutter as well as storm water management improvements. This <br />would be an encumbrance on the property and could be detrimental to future sale. A lease <br />agreement would need to include provisions for tear out of the parking lot, at the expense of the <br />Legion, if the city sells the property. <br />The property is currently tax exempt. If leased, the property would lose its tax exempt status. <br />Based on discussions with Anoka County taxes would amount to approximately $2,400 per year. <br />A typical land lease rate for an acre of commercial property valued at $91,000 is approximately <br />$450 to $600 per month. A qualified appraisal should be completed to determine an actual rate. <br />At a minimum the city would need to charge enough to cover local costs. <br />Council Direction <br />Staff is requesting council direction regarding the following: <br />1. Does the Council want to allow public land to be used for private purposes? <br />2. If so, should staff pursue an appraisal and lease agreement with the American Legion <br />with all costs paid for by the American Legion? <br />Attachments <br />1. General Location Map <br />1 <br />