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Item No: 08B Meeting Date: July 22, 2019 Type of Business: Council Business City Administrator Review: City of Mounds View Staff Report To: Honorable Mayor and City Council From: Jon Sevald, Community Development Director Item Title/Subject: Second Reading and Adoption of Ordinance 960, Amending City Code, Chapter 1204, and the 2019 Fee Ordinance, related to Park Dedication Fees (Special Planning Case SP-215-19) Introduction: A Park Dedication Fee may consist of land or cash charged to a Developer, to be used for capital improvements to parks, trails, and open space. The Fee cannot be used for operations or maintenance. The intent is for the Fee to offset the City's cost of providing park facilities for use by these new residents and new businesses (e.g. Nexus between fee and need).' Discussion: Mounds View's Park Dedication Fee is 10% of the land, or 10% of the estimated market value (EMV) of the land (or a combination of the two).2 Credit is provided for single-family redevelopment projects, in which the existing home is kept. For example, if one lot is subdivide into two lots, only one fee is charged.3 Because the cash fee is based on the EMV of land, which can vary widely, Staff have found this difficult to estimate on projects involving multiple properties. For example, on the planned Long Lake Woods Second Addition, the EMV varies between $0.40 and $2.19 per sq ft. The City of Roseville conducts an annual survey of Park Dedication Fees, finding that most cities charge a flat fee per dwelling unit (about $3,500), or per acre ($9,400 average p/acre) in the case of commercial/industrial developments. During the May 6, 2019 Council Work Session. The Council provided a consensus to change the residential fee to $3,500 per unit, and to keep the commercial/industrial fee as -is. Attached is a chart comparing Park Dedication Fees of recent Mounds View developments if those projects had been in nearby cities. In summary, Mounds View charges a reasonable fee for single-family developments, a low fee for multi -family, and a high fee for commercial and industrial developments. Strategic Plan Strategy/Goal: Maintain and plan for infrastructure improvements including waste water, water, & transportation. Financial Impact: Increasing this Fee would mean less dependence on the Special Projects Fund, to fund discussed parks projects. MN Statute 462.358, Subd 2(c) (Nexus) 2 In 2004, Ord 745 increased the fee from 5% EMV to 10% EMV for residential subdivisions less than 1-acre. If greater than 1-acre, the fee remained 10%. It is believed the City has charged a park Fee since 1988, and is based on 1980 legislation. 3 City Code, Section 1204.02, Subd 3 (Credit for Existing Single -Family Dwelling)