Loading...
HomeMy WebLinkAbout2007/06/25 - ADMIN - Agenda Packets - City Council - Study Session City Council Study Session June 25, 2007 6:30 p.m. Council Chambers Discussion Items 1. 6:30 p.m. Future Agenda Planning 2. 6:35 p.m. Business Terms for EDI Project 3. 7:35 p.m. Long-Range Financial Planning 4. 8:35 p.m. Novartis Update Written Reports 5. Metropoint Parking Lot Improvements 6. May 2007 Monthly Financial Report 7. ParkWiFi Update 8. Sidewalk Snow Removal Enforcement Program Update 9. Community Videos 8:50 p.m. Adjourn Auxiliary aids for individuals with disabilities are available upon request. To make arrangements, please call the Administrative Services Department at (952) 924-2525 (TDD (952) 924-2518) at least 96 hours in advance of meeting. St. Louis Park City Council Study Session Discussion Item: 062507 - 1 - Future Study Session Agenda Page 1 1. Future Study Session Agenda Planning Administrative Services PURPOSE OF DISCUSSION: To assist the City Council and the City Manager in setting the next study session agenda. BACKGROUND: At each study session, approximately five minutes are set aside to discuss the next study session agenda. For this purpose, attached please find the tentative agenda and proposed discussion items for the regularly scheduled study session on July 9. Attachment: Future Study Session Agenda Planning Prepared by: Marcia Honold, Management Assistant Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Discussion Item: 062507 - 1 - Future Study Session Agenda Page 2 Future Study Session Agenda Planning Tentative Discussion Monday, July 9, 2007 – 6:30 p.m. A. Future Study Session Agenda Planning – Administrative Services (5 minutes) B. Board of Zoning and Appeals – Community Development (15 minutes) The Board of Zoning and Appeals will meet with Council to discuss the 2006 annual report. C. Police Mapping – Police and Information Resources (30 minutes) Staff is returning to Council with information on the input received from the community on police mapping. Revisions to the proposed police mapping system will also be described. Staff will be asking Council if it should proceed on a web based police mapping system. D. Marketing and Branding – Information Resources (30 minutes) Staff will introduce the firm that has been selected for this initiative and staff will present the scope of work that is being considered. Council will be asked if it is comfortable with staff continuing to move forward on this initiative. E. Duke Business Points – Community Development (45 minutes) Council and staff will review the proposed terms of the redevelopment agreement business points with Duke. Council will be asked if staff should proceed with finalizing a redevelopment agreement and prepare it for EDA action. 8:30 p.m. End of Meeting St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 1 2. Business Terms for Methodist Hospital’s Eating Disorders Clinic at 3515 Belt Line Boulevard. Community Development PURPOSE OF DISCUSSION: Staff wishes to review and receive feedback on the latest business terms related to the proposed sale of a portion of 3515 Belt Line Blvd and the development of Methodist Hospital’s Eating Disorders Clinic on the site. Specific items staff wishes to discuss include: • Proposed site plan and building elevations. • Property sale process. • Updated project costs. • Proposed Business Terms. • Next steps. Park Nicollet/Methodist Hospital recently determined it would be more cost advantageous if Methodist owned rather than leased the proposed Eating Disorders Clinic property. Thus the business terms previously negotiated for the project have changed. In summary, United Properties would purchase the northern half of the Bass Lake Property from the City at market rate. United Properties would then construct a medical office building on the site under a build- to-suit agreement with Methodist Hospital. Upon project completion Methodist Hospital would purchase and operate the building for use by its Eating Disorders Institute (EDI). Since Methodist Hospital is a non profit organization the new development would be exempt from paying property taxes. Due to this substantial cost savings, the development would assume all previously identified costs of soil correction and site improvements over the entire Bass Lake Property. The city would be kept financially whole by Methodist’s agreement to provide the city with an annual Payment In Lieu of Taxes (PILOT). Provided the EDA/Council is agreeable to the proposed Business Terms, staff would: ♦ Prepare a formal Purchase and Redevelopment Contract with the Redeveloper. ♦ Pursue various planning approvals. ♦ Schedule a public hearing to consider the sale of the subject property and formal approval of the Purchase and Redevelopment Contract. BACKGROUND: At the May 15, 2007 Study Session United Properties and staff presented two potential site plans depicting how Methodist Hospital’s Eating Disorders Clinic and its structured parking could be situated on the Bass Lake Property. Staff also reviewed its analysis of United Properties’ TIF Application and general business terms for the proposed project (the May15, 2007 staff report is attached). The EDA/Council expressed a preference for the site plan where the parking structure was tucked back further on the site and was less visibly prominent along Belt Line Boulevard. It was also the consensus of the EDA/City Council that the proposed business terms were generally St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 2 acceptable however staff was asked to find ways to further reduce some of the project costs so as to reduce the term of the proposed TIF district. With this in mind, staff was directed to prepare a more specific list of business terms that would serve as the basis for a formal Redevelopment Contract along with a more precise estimate of the financial assistance required to facilitate the proposed project. The city’s Bass Lake Property located at 3515 Belt Line Boulevard was primarily conveyed to the city by the State of Minnesota through a series of tax forfeitures between 1942 and 1960. It includes nearly 7.3 acres including old right-of-way that will need to be vacated. The subject property was formerly the site of the municipal Bass Lake Dump which was in operation during the 1960s and early 1970s. During that time, fill and waste material (primarily incinerator ash) was deposited at the site that requires environmental actions (primarily soil rebalancing with a required level of clean top soil). The subject property also has poor soil conditions due to the presence of peat and other unstable material. These conditions require that nearly all structures be structurally supported with pilings. SYNOPSIS OF PROPOSED PROJECT: The Bass Lake Property is proposed to be subdivided into two parcels: the northern parcel (the “Redevelopment Property”) would be approximately 3.5 acres and the southern parcel (the “Remainder Parcel”) would be approximately 3.8 acres. United Properties (the “Redeveloper”) would acquire the Redevelopment Property and the city would retain ownership of the Remainder Parcel. The Redeveloper would then construct a high-quality medical office building along with related structured and surface parking on its site as a build-to-suit for Methodist Hospital’s Eating Disorders Institute. The proposed site plan for the Bass Lake Property (attached) depicts the following: • 3-story, 67,400 square foot medical clinic with 30 beds located on the top floor • 2-level, 132-stall, structured parking facility • 105 surface parking stalls • 2 driveway entrances with landscaped medians • 1 service driveway • A pedestrian trail that connects with the George Haun Trail • 1 stormwater retention pond • 2 tennis courts • Space to accommodate a future building (possibly for civic use) • Green space (capable of accommodating various amenities such as a sculpture garden) The remaining southern parcel (“the Remainder Parcel”) would be retained by the City for an undetermined future use compatible with the proposed clinic. Suggested ideas for the Remainder Parcel include: sculpture garden, arts & culture center, multi-purpose conference facility, library, or some combination of these or other similar civic uses as mentioned in the recently-completed Vision St. Louis Park report. Should it later be determined that none of the above uses are suitable or needed for the Remainder Parcel, it could potentially be sold for private purposes such as for another office building. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 3 It should also be noted that the proposed clinic parking ramp will be designed and engineered to allow additional parking levels to accommodate anticipated parking needs generated by a future building or uses constructed on the Remainder Parcel. PROPOSED LAND USE CHANGES: The Bass Lake Property is currently guided and zoned RC – Multiple Family. To enable the proposed development, the property will need to be reguided and rezoned O – “Office”. This parcel was originally platted in 1911 prior to going tax forfeit. The property will require replatting and the old streets, alleys and easements will require vacation before the city can sell the property. The existing shape of this parcel reflects the old plat and has little or no relationship to the current street layouts or use patterns in the area today. The property boundaries are awkward and inconsistent with the city’s current design standards. For example, the parcel has very sharp, acute angles at the northern boundary with the public open space. It makes development of the north portion of the property challenging. Per the Council’s direction at the last Study Session, a site plan has been prepared for the Redevelopment Property that does not infringe upon the open space property immediately to the north (4860 35th Street West). The only thing the open space property is to be used for is driveway access. The dual-purpose driveway crosses the open space to access both public parking for the pedestrian trail and service deliveries to the clinic. PROPOSED RELOCATION OF TENNIS COURTS: The proposed EDI project will require the relocation of the six tennis courts currently located on the Bass Lake Property. As a result, four replacement courts are being constructed at Aquila Park. The Parks and Recreation Department has requested that two tennis courts be reconstructed elsewhere on the Remainder Parcel for neighborhood recreational purposes. These courts are proposed to be located in the southeast corner of that property. REVISED BUSINESS TERMS: Below are the revised general business terms recently negotiated between staff, United Properties, and representatives of Park Nicollet/Methodist Hospital. Note the Business Terms are significantly different from the terms previously discussed. The changes are the result of the expectation that the property/project would be owned by Methodist and therefore tax exempt. A table comparing the original taxable proposal with the current tax exempt proposal is provided below. Land Sale To facilitate the proposed project the city would replat and convey the subject property to the EDA. The EDA would then convey the 3.56-acre “Redevelopment Property” to United Properties for $12 per square foot or approximately $1.8 million. The City Assessor concurred that the proposed sale price is in line with comparable, fair market, commercial property sales in the city. The city will need to secure clear title to the property by working with the county. County policy requires sharing half of the purchase price with the county. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 4 Minimum Improvements The Redeveloper agrees to construct the proposed $29 million medical office building and related structured and surface parking on the Redevelopment Property under a build-to-suit arrangement with Methodist Hospital. Construction is estimated to start in the fall of 2007 and be completed within 18 months. Property Sale and Maintenance Upon construction completion, the medical office building is to be sold to Methodist Hospital for its primary use as a world-class eating disorders clinic. Methodist Hospital would then own, operate, and maintain the facility. Methodist would also maintain the site improvements on the city’s Remainder Parcel (except the lawn, tennis courts, and pedestrian trail) until the parcel is put to permanent use. The city would be responsible for maintenance of the pedestrian trail over the entire Bass Lake Property. Soil Correction and Site Improvements Costs The Redeveloper would be responsible for implementing and paying for all environmental response actions necessitated by the construction of the Minimum Improvements, as specified in the MPCA-approved Response Action Plan and Contingency Plan. These actions primarily include rebalancing the soils over the entire Bass Lake Property (including the city’s Remainder Parcel). They also include and installing utilities, lighting and surface parking according to MPCA requirements. These soil correction costs are currently estimated at $2,434,000. The Redeveloper would also initially pay for all site improvement costs over the entire Bass Lake Property. These improvements include: rebuilding six tennis courts, burying overhead utility wires, driveways, surface parking, landscaped medians, sidewalks, lighting, and enhancing the structural capacity of the parking ramp. These costs are estimated at $786,000. The city would be responsible for the cost of the pedestrian trail connection. Property Taxes Until recently it was understood that the Redevelopment Property would be leased by Methodist Hospital and owned by a private, third party. This would have placed the property back on the property tax roll. It is estimated that Methodist would have paid approximately $492,000/year in property taxes if the Redevelopment Property was owned by a taxable entity. Most of these taxes would have gone to taxing jurisdictions other than the city. If the property was placed in a TIF District approximately $235,000/year would have been collected as tax increment annually and been available to pay for soil correction costs. Under the new arrangement, Methodist would own the property and thus the property would retain its tax-exempt status since Methodist is a qualified nonprofit organization. In order to keep the city financially whole, Methodist has agreed to make annual payments to the city in lieu of property taxes had the project not qualified as tax exempt. The initial Payment In Lieu of Taxes (PILOT) would be approximately $20,000 based upon the base value of the property ($600,000). It would be payable one year following the date of transfer to Methodist Hospital St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 5 and continue for 18 years (the same proposed term as the previously proposed TIF district). This payment would be inflated annually at the standard rate of CPI-U. In year 19, the PILOT converts to what the city would have received in property taxes based upon the full value of the improved property. The revised PILOT would then run for another 22 years. After that point the PILOT would terminate. The increased PILOT would be inflated annually at the standard rate of CPI-U. Comparison of Taxable and Tax Exempt Development Scenarios Below is a chart depicting the difference, from the city’s perspective, between the EDI Project being a taxable versus tax exempt development. Taxable Tax-Exempt Land sale proceeds $ 12/sq.ft. $ 1,800,000 to City $ 12/sq.ft. $ 900,000 to City $ 900,000 to County Reinvestment of land sale proceeds $ 334,000 soil corrections $ 837,000 site improvements None (Methodist responsible for soil correction and site improvement costs) TIF District 20 yr Soils District $2,100,000 assistance to Redeveloper None City Property Taxes $ 96,000 starting 2029 None PILOT Based on city’s portion of real estate taxes None Initial payment based on property’s base value with annual inflationary increases for 18 yrs. Subsequent PILOT based on full value of the property plus inflation for 22 years. The new, proposed, tax exempt arrangement precludes the need to provide TIF assistance to facilitate the proposed project. This makes the EDI project considerably less complicated and affords all parties the opportunity to save both considerable time and expense. City Agreement to Issue Private Activity Revenue Bonds To facilitate the financing of the proposed project, the city would agree to issue a private activity revenue bond in conjunction with Methodist Hospital/Park Nicollet Health Services. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 6 Right of Reverter Closing on the Redevelopment Property will be contingent on satisfaction of conditions usual and customary in EDA redevelopment contracts (e.g., construction plans have been approved, Redeveloper has obtained financing, Redeveloper has reviewed title and environmental conditions). The deed will be subject to a right of reverter in favor of the EDA, enforceable if the Minimum Improvements are not timely completed. The reverter expires after such completion. Other Business Terms Other Business Terms related to the proposed EDI project are attached. Upon acceptance by all parties, all Business Terms will be incorporated into a formal redevelopment contract for the subject property. NEXT STEPS: Staff would like to receive feedback from the EDA/Council on the proposed site plan and revised Business Terms. If acceptable, staff would initiate planning approvals, have the Business Terms incorporated into a formal Redevelopment Contract, and schedule a public hearing to formally consider conveyance of the subject property. Attachments: Staff Report of May 14, 2007 Site Plan (Supplement) Business Terms (Supplement) Prepared by: Greg Hunt, Economic Development Coordinator Reviewed by: Kevin Locke, Community Development Director Approved by: Tom Harmening, EDA Executive Director, City Manager St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 7 May 14, 2007 Study Session Report 2. United Properties’ Application for Tax Increment Financing to facilitate construction of a medical office building for Park Nicollet’s Eating Disorders Clinic at 3515 Belt Line Boulevard. Community Development PURPOSE OF DISCUSSION: Staff wishes to review and receive feedback on the proposed sale of a portion of 3515 Belt Line Blvd and 4860 35th Street West to United Properties (“the Redeveloper”). Staff also wishes to discuss the Redeveloper’s application for Tax Increment Finance (TIF) assistance and proposed Business Terms to facilitate development of a medical office building on the above site. Specific items staff wishes to discuss include: • Proposed site plan and building elevations. • Proposed land use and zoning requirements. • Property sale process. • Amount and term of TIF assistance and other project costs. • Proposed business terms. • Compliance with the city’s TIF policy. • Next steps. In summary, United Properties’ TIF Application requests approximately $2.7 million in financial assistance to facilitate the construction of a $29 million medical office building for Park Nicollet’s Eating Disorders Institute (EDI) on the city’s Bass Lake Property located at the northeast corner of Belt Line Boulevard and Monterey Drive (“subject property”). As a reminder, Monday night’s discussion of the merits of the above project and its qualification for tax increment finance assistance does not, in itself, obligate the EDA/Council to providing the requested assistance. Provided the EDA/Council wishes to pursue this project further staff would: ♦ Prepare a formal Purchase and Redevelopment Contract with the Redeveloper. ♦ Pursue various planning approvals. ♦ Begin the formal process of creating the proposed Soils TIF District. BACKGROUND: At the May 22, 2006 Study Session the EDA/City Council expressed its general support for allowing United Properties to develop a medical office building on a portion of the subject property. The facility would be leased to Park Nicollet for its nationally-recognized Eating Disorders Institute. As a result, staff was directed to prepare a Preliminary Development Agreement (PDA) with United Properties. This Agreement was subsequently approved by both the EDA and City Council on June 19, 2006. In it, the parties were required, along with other matters, to “complete refinements to the preliminary concept plan” and negotiate “toward a mutually satisfactory redevelopment contract”. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 8 At the November 6, 2006 Study Session staff outlined preliminary site plans and business terms of the proposed project and it was the consensus of the EDA/City Council that the plans and terms were generally acceptable. Staff was then directed to negotiate further with United Properties and develop a more specific list of business terms that would serve as the basis for a formal Redevelopment Contract along with a more precise estimate of the financial assistance required to facilitate the proposed project. The Bass Lake Property located at 3515 Belt Line Boulevard was primarily conveyed to the city by the State of Minnesota through a series of tax forfeitures between 1942 and 1960. It includes nearly 7.3 acres including old right-of-way that will need to be vacated. The property is currently the site of six tennis courts (leased on a short term basis to Benilde-St. Margarets High School) and a “temporary off-leash dog park”. Despite these interim recreational uses, the property is designated for “High Density Residential” use in the city’s Comprehensive Plan. The subject property was formerly the site of the former municipal Bass Lake Dump which was in operation during the 1960s and early 1970s. During that time, approximately 70,000 cubic yards of fill and waste material (primarily incinerator ash) was deposited at the site at a maximum depth of 17.5 feet. This material was overlaid with between 2 and 12 feet of topsoil to provide a protective cover. In January 2007, a Response Action Plan (RAP) was submitted to the MPCA which outlined the proposed environmental clean up activities and soil correction measures to be implemented should the property be developed as proposed. This RAP was recently approved by the agency. The subject property also has poor soil conditions due to the presence of peat and other unstable material. Bedrock is 62 – 67 feet under the surface and any buildings and utilities would require piling or structural support. Due to the property’s close proximity to the Bass Lake Preserve, groundwater can be found 8 to 11.5 feet below the ground surface. The actual depth and location of the groundwater table fluctuates seasonally and annually with variations in the amount of precipitation, surface run-off, and infiltration. SYNOPSIS OF PROPOSED PROJECT: As envisioned, the city’s Bass Lake Property would be subdivided approximately in half. The resulting northern parcel (the “Redevelopment Property”) would be conveyed to the EDA which would, in turn, sell it to United Properties. United Properties would construct a high-quality medical office building on the site (along with related structured and surface parking) and lease it to Park Nicolett for its Eating Disorders Institute. The proposed site plan for the Bass Lake Property (attached) depicts the following: • 3-story, 67,400 square foot medical clinic with 30 beds located on the top floor • 2-level, 130-stall, structured parking facility St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 9 • 70 surface parking stalls • 2 driveway entrances with landscaped medians • 1 service driveway • A pedestrian trail that connects with the George Haun Trail • 1 stormwater retention pond • 2 tennis courts • Space to accommodate a future building (possibly for civic use) • Green space (capable of accommodating various amenities such as a possible sculpture garden) The remaining southern parcel (“the Remainder Parcel”) would be retained by the City for an undetermined future use compatible with the proposed project. Suggested ideas for this 4-acre Remainder Parcel include: sculpture garden, arts & culture center, multi-purpose conference facility, library, or some combination of these or other similar civic uses as mentioned in the recently-completed Vision St. Louis Park report. Should it later be determined that none of the above uses are suitable or needed for the Remainder Parcel, it could potentially be sold for private purposes such as for another office building. It should also be noted that the proposed clinic parking ramp will be required to be expandable in order to accommodate anticipated parking needs generated by a future building or uses constructed on the Remainder Parcel. PROPOSED LAND USE CHANGES: The Bass Lake Property is currently guided and zoned RC – Multiple Family. To enable the proposed development, the property will need to be reguided and rezoned O – “Office”. Staff recommends that the Remainder Parcel also be zoned Office so as to allow the city the greatest flexibility as to its eventual use. A civic building would be allowed in an Office District. This parcel was originally platted in 1911 prior to going tax forfeit. The property will require replatting and the old streets, alleys and easements will require vacation before the city can sell the property. The existing shape of this parcel reflects the old plat and has little or no relationship to the current street layouts or use patterns in the area today. The property boundaries are awkward and inconsistent with the city’s current standards or design. In particular, the parcel has very sharp, acute angles at the northern boundary with the public open space. It makes development of the north portion of the property challenging. With the recent creation of a Parkland Zoning District this open space, north of the Bass Lake Property, became zoned Park and Open Space. The Redeveloper is requesting that a small portion of this open space property immediately to the north (4860 35th Street West) be conveyed and combined with the subject property in order to accommodate the proposed parking ramp, stormwater pond and to create a more reasonable northern boundary line to the Redevelopment Property. The area needed is approximately a half acre and partially in the flood zone. The conveyance of this property would be more than compensated with the 1.3 acre area at the northeast corner of Monterey and Belt Line Blvd (part of the city’s Remainder Property) that is planned to be set aside for green space and possibly a sculpture garden. The conveyance of this small open space property would however be subject to the public process outlined in the recently-adopted Sale of Park Land Ordinance. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 10 PROPOSED RELOCATION OF TENNIS COURTS: The proposed EDI project will require the relocation of the six tennis courts currently located on the Bass Lake Property. As a result, it is proposed that four replacement courts be constructed at Aquila Park. The Parks and Recreation Department has requested that, if possible, two tennis courts remain or be reconstructed elsewhere on the “Remainder Parcel” for neighborhood recreational purposes. The Redeveloper has expressed a preference that these courts be relocated in the southeast corner of that property. Originally the six tennis courts on the Bass Lake Property were constructed under an agreement with Benilde-St. Margarets High School for use by its boys and girls tennis teams. Under that agreement, Benilde agreed to construct the courts on the city’s property and if the city needed the courts removed prior to 2008 the city agreed to compensate Benilde under a sliding scale fee formula. Given that there is one year remaining under the agreement, the city would be required to compensate Benilde $7,500 for that one year. As proposed, the city would add four tennis courts to the existing four courts at Aquila Park. This would make a tennis area with eight courts for use by Benilde/St. Margaret’s and the city. Constructing the new tennis courts at Aquila Park is acceptable to Benilde. The school has been asked to assume 40% of the tennis courts’ construction costs and to share equally in the courts’ annual maintenance (which was not addressed under the previous agreement). The proposed project will not disrupt Benilde’s tennis seasons. The Redeveloper does not plan to break ground until August/September which will allow Benilde time to complete its spring tennis season. The new courts at Aquila Park are tentatively scheduled to be completed by early August which will accommodate the fall tennis season. THE REDEVELOPER: United Properties is a full-service commercial real estate company with more than 400 employees and 26.5 million square feet of office, industrial, retail and multi-family properties under management. It offers a variety of real estate services, including brokerage, property management, corporate real estate services, facility services, construction management, development services and investment services. United Properties is based in the Twin Cities, and provides real estate services worldwide. In 2004 United Properties was recognized as the “Developer of the Year” by the National Association of Office and Industrial Properties (NAIOP). PROPERTY VALUE AND TAXES: Currently, the Bass Lake Property is owned by the city and therefore is tax exempt. United Properties wishes to purchase the northern portion of that property (approximately 3-4 acres). The market value of this Redevelopment Property upon project completion is estimated at $14.8 million. It will also generate over $492,000 in total property taxes. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 11 PRO FORMA ANALYSIS: As proposed, the city intends to sell the Redevelopment Property to United Properties for market value. In order to do so, the Redevelopment Property needs to be developable which, due to the contamination and poor soils, it currently is not. Thus, the city will need to fund measures that correctly address the contamination and structurally support the proposed buildings. The proposed source of these funds would come from a Soils Condition TIF District. Approximately $2.7 million is needed to offset the extraordinary soil correction costs associated with the entire subject property. More specifically, these costs include: handling and exporting contaminated soils; installation of pilings and structural slabs; site grading, and lining the stormwater pond. These costs would be considered extraordinary development costs. According to the TIF Cash Flow Analysis provided by Ehlers & Associates, the proposed project would generate approximately $2.1 million in tax increment over 21 years using a 6.5% interest rate and no inflation. Since the proposed TIF district cannot generate sufficient revenue to pay for the entirety of the soil correction costs, it is proposed that the difference be repaid from the Land Sale Proceeds. Twenty-one years is the maximum term of a Soils Condition TIF District. Typically, the city prefers to retire TIF districts early in order to bring the captured parcels back unto the tax rolls as soon as possible however, given the magnitude of the soil correction costs with this particular development that is not possible. Tax increment from a Soils District can only be used for contaminated soil correction activities. SYNOPSIS OF REDEVELOPMENT AGREEMENT: Below are the general business terms, mutually negotiated between staff and United Properties which are proposed to be incorporated into a future redevelopment contract for the subject property. Land Sale: To facilitate the proposed project the city would replat and convey the subject property to the EDA. The EDA would then convey the 3 to 4-acre “Redevelopment Property” to United Properties for $12 per square foot or approximately $1.5 million. The City Assessor concurred that the proposed sale price is in line with comparable, fair market, commercial property sales in the city. The precise area of land to be sold to United Properties will be determined once the new plat is prepared. Minimum Improvements The Redeveloper agrees to construct the proposed medical office building and related parking on the Redevelopment Property. Upon completion it is expected to have a value of approximately $14.8 million for tax purposes. Construction is estimated to start in the fall of 2007. Lease to Park Nicollet: The proposed medical office building is to be leased and operated by Park Nicollet Health Services for its primary use as a world-class eating disorders clinic. Park Nicolett has committed to leasing the facility for its Eating Disorders Institute for an initial 18-year term with two 5-year options (lease extensions). St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 12 Environmental Costs: The Redeveloper agrees to be responsible for implementing and paying for all environmental response actions necessitated by the construction of the Minimum Improvements, as specified in the MPCA-approved Response Action Plan and Contingency Plan as well as all related costs of monitoring and reporting. Tax Increment: The EDA agrees to reimburse the Redeveloper for the $2.7 million in soil correction costs from a combination of tax increment and the Land Sale Proceeds. The tax increment would be derived from the establishment of a Soils Condition TIF District. The TIF note would be structured on the following basis: ¾ Issue total: Estimated $2.1 million ¾ Term: 21 years ¾ Interest Rate: 6.5 % or actual rate of construction financing ¾ Admin Fee: 5% ¾ Fiscal Disparities: Paid from within the district The tax increment assistance would initially be provided through a Pay-As-You-Go TIF Note to United Properties. The city will likely be asked to issue a tax exempt take out bond when construction is complete – the same arrangement as was used with Dunbar Development for the Hoigaard Village project. To the extent the tax increment does not cover all the soil correction costs (estimated at $600,000) the EDA will reimburse the Redeveloper for these remaining costs out of the Land Sale Proceeds. Shared Site Development Costs: Redeveloper and the City/EDA agree to evenly split site improvement costs that serve both clinic and civic uses. These include: • The two driveways and attached surface parking. • Driveway landscaping. • Driveway lighting. • Sidewalks The EDA will utilize Land Sale Proceeds to pay for its portion of these expenses. The estimated city share of these items is $169,500. City/EDA Site Development Costs: The Redeveloper agrees to provide an easement to the city on its property for a pedestrian trail connection to the adjacent George Haun trail. The city agrees to construct and pay for the trail connection. The estimated cost is $51,500. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 13 The EDA agrees to reimburse the Redeveloper for the added costs of making the parking structure expandable to three levels in the future. In turn, public parking will be allowed in the surface stalls and parking ramp during evenings and weekends as well as during weekdays, to the extent it does not interfere with the clinic’s operations. The estimated cost to make the ramp expandable is yet to be finalized but is projected to be approximately $385,000. The EDA agrees to pay for relocating and constructing four tennis courts at Aquila Park and two tennis courts on the city’s Remainder Parcel. The EDA agrees to pay for burying the overhead electric lines on the city’s Remainder Parcel. Altogether, the city’s total site development costs will equal approximately $1 million. The EDA will utilize Land Sale Proceeds to pay for all these expenses. Look Back Provision: As with other recent redevelopment projects with which the EDA has been involved, United Properties agrees to the inclusion of a "look back" provision in the redevelopment contract. Such a provision would enable the EDA to review United Properties' development costs and gross margins after the development is sold to third parties. Use of any excess profit will be further refined and brought back as part of the approval of the Redevelopment Agreement. PROPOSED TIF DISTRICT SUMMARY: The Bass Lake Property is located within the city’s Redevelopment Project Area No. 1 and the Excelsior Boulevard TIF District. The subject property would need to be decertified from the current Excelsior Boulevard TIF District and a new Soils Condition District would need to be created. CONFORMANCE AND ANALYSIS UNDER THE CITY’S TIF POLICY: The proposed project meets the following city objective for the use of TIF: • Remove blight and/or encourage redevelopment in the commercial and industrial areas of the city in order to encourage high quality development or redevelopment and private reinvestment in those areas. In addition to meeting nearly all the “Minimum Qualifications” for using TIF, the proposed project meets the following “Desired Qualifications” as outlined in the TIF Policy: • It creates a higher ratio of property taxes paid before and after redevelopment and provides a significant increase in tax base. • The Redeveloper is able to provide evidence which supports the market potential/demand for the proposed project. • It redevelops a partially underutilized area. • The Redeveloper is able to demonstrate that the proposed project plan is not financially feasible “but-for” the use of tax increment financing. • It will not place extraordinary demands on city services. • It cleans up an existing contaminated site. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 14 • It meets “good public policy criteria” such as: high quality architectural design, provides significant improvement to surrounding land uses, provides significant retained/new employment, and provides highest and best desired use for the property. • The Redeveloper is able to demonstrate past general development capability as well as specific capability in the type and size of development proposed. In addition to the above, the proposed project would have the following additional economic and social benefits for the community: 1. The city would gain a site fully prepared for a possible future civic use. Such a site could fulfill some of the dreams expressed in the city’s recently completed Visioning process. The site would have a driveway entry with boulevard landscaping and lighting, surface parking, sidewalks, and a stormwater retention pond. The adjacent parking ramp would be designed so that it could be expanded in anticipation of future public parking needs. 2. The city would obtain a needed pedestrian connection to the George Haun Trail. 3. The city would receive four new tennis courts at Aquila Park and two rebuilt tennis courts in the Wolfe Park neighborhood. 4. The public would gain parking access to the surface stalls and parking ramp during evenings and weekends. This will be beneficial when overflow parking is needed at the adjacent Rec Center. 5. The new medical clinic would enable St. Louis Park’s largest employer to expand thus allowing it to further contribute to the city’s economic vitality. 6. Park Nicollet would retain several medical disciplines from the existing clinic and the hospital and consolidate them into a new facility thus freeing up additional space at those facilities for further expansion opportunities. 7. The new facility would retain and create a total of approximately 220 quality jobs in the community. 8. The facility would further enhance St. Louis Park’s reputation as a strategic location for the medical industry. 9. The EDI is proposed to be a “world class” center for treating eating disorders and as such the St. Louis Park–based facility would receive ongoing national if not, international, recognition. 10. The clinic would attract patients and their families from the Midwest (primarily) and beyond. These visitors will be patronizing local hotels, restaurants and stores. This will, no doubt, economically benefit several retail areas throughout the city particularly those in close proximity. St. Louis Park City Council Study Session Discussion Item: 062507 - 2 - Business Terms for EDI Project Project Page 15 11. The new facility would enable Park Nicollet to double the number of patients it treats for eating disorders – a serious, life-threatening, illness. Currently, Park Nicollet treats about 500 patients a year. The new clinic is expected to eventually treat 1,500 patients a year. 12. Consolidating Park Nicollet’s EDI in St. Louis Park is consistent with the city’s commitment to helping young people and would further enhance St. Louis Park’s national reputation as a “Children First” community. GRADING UNDER THE CITY’S TIF REPORT CARD: United Properties’ TIF Application was graded according to the factors included the “Report Card” for evaluating Commercial Redevelopment Projects within the city’s TIF Policy. Upon calculation of the various factors and bonus points, the proposed EDI project received a final grade of “A” or “Excellent” according to the scale provided within the Report Card. To see how each factor was scored please see the attached TIF Report Card. CONFORMANCE WITH THE CITY’S BUISNESS SUBSIDY POLICY: Any proposed TIF assistance provided the subject project would be exempt from state business subsidy requirements as it relates to contaminated property (Section 116J.552, subdivision 3,). Therefore, no public subsidy hearing is required; however, it is still subject to a modified reporting requirement. NEXT STEPS: Staff would like to receive feedback on the proposed project in general as well as the site plan and Business Terms in particular. If the EDA/Council is interested in moving forward on the proposed project as outlined, staff would initiate some of the outlined planning approvals and have the Business Terms incorporated into a formal Redevelopment Contract. Attachments: Site Plan (Supplement) Preliminary Building Elevations (Supplement) TIF Report Card (Supplement) Prepared by: Greg Hunt, Economic Development Coordinator Reviewed by: Kevin Locke, Community Development Director Approved by: Nancy Gohman, EDA Executive Deputy Director, Deputy City Manager St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 1 3. Long-Range Financial Planning Finance Department PURPOSE OF DISCUSSION: This item is presented to familiarize the City Council with the purpose of a long-range financial management plan (FMP). We will examine the types of funds and funding sources that the city uses. This will allow staff and the council to have a common understanding of our financial position prior to our budget and capital improvement plan (CIP) approvals for next year. It will also assist us in identifying funding sources for our operating and capital financing needs. This is the second of a series of conversations staff proposes to have with Council as we move towards creating a FMP. BACKGROUND: Long-range financial planning is a comprehensive multi-year fiscal guide that reviews all tax supported funds in the city. It integrates operating expenses with projected capital plans, debt service, and community growth to show the effect of current year decisions on the city’s long term financial position. The main purpose of a financial plan is to make sure that changes in service are sustainable and meet the city’s vision. A financial plan allows the city to be comfortable knowing that it has sufficient reserves to cover unanticipated emergencies or legislative changes. It also helps to prioritize new spending requests against existing commitments. The financial plan will allow the City Council and staff to spot imbalances and proactively plan changes over several years. This type of planning evens out short term variations in the various funding sources and expenditures over a longer horizon so that changes in taxes and fees are made gradually and affordably. As we get further into the process, we will review the impact of our current plans on the total tax levy, city tax rate, and impact on businesses and residential properties. Completing an FMP will lead to a better understanding of the implicit policies that guide city financial decisions. We should take the opportunity while starting the financial management plan to formalize those policies. While we do have some policies in place, they need to be reviewed to determine if any changes are warranted. In other areas, we do not have any policies in place other than that we will follow state statute. Best practices indicate that there is a strong correlation between having good policies in place and city financial performance. Basis of Accounting Government finance differs from business accounting in several material ways. This is primarily because we do not operate on an exchange transaction basis. Exchange transactions are where each party gives and receives essentially equal value. Non-exchange is where taxes or fees are imposed with no expectation that specific services of approximately equal value will be provided. Since taxes and fees are imposed for particular purposes, our goal is to show that those funds are used only for the activity that has been specified. St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 2 We operate governmental funds on the basis of liabilities that are payable in the current period and funds available now to be spent. This concept is called the modified accrual basis of accounting. Because of this focus on current revenues and expenditures we don’t report long- term debt in our governmental funds and don’t focus on the total equity of the city. Most of our assets are not for sale and would have little utility to any other owner such as roads, storm water ponds, and utility easements. Another clear difference is that we report funds separately. Business financial statements only show the condition of the business as a whole - not individual components. Government needs to show proper stewardship of funds that have restricted uses. The General Fund is supposed to show all of the non-restricted activities of the city. The other funds are designed to show that restricted funds are being used for their specified purpose. The funds below noted with a “*” are those that are property tax supported The types of funds that St. Louis Park currently has are: Governmental Funds General Fund* Special Revenue Funds Park & Recreation Fund* Police & Fire Pension Fund Cable Television Fund Community Development Block Grant Fund Special Service Districts 1-4 Funds* Housing Rehab Fund Debt Service Funds* Capital Outlay Funds Permanent Improvement Revolving Fund Tax Increment District Funds* Development Fund Municipal Building Fund* Park Improvement Fund* Pavement Management Fund* Proprietary Funds Enterprise Funds Water Utility Fund Sewer Utility Fund Solid Waste Utility Fund Storm Water Utility Fund Internal Service Funds Technology Replacement Fund* Equipment Replacement Fund* Employee Benefits/Flexible Leave Fund* Uninsured Loss Fund* St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 3 During the meeting we will look at each of our funds in detail to review the funding sources and common expenditures. A PowerPoint presentation will be presented to allow for discussion of individual funds. Attachments: Standard & Poor’s Financial Management Assessments Prepared by: Bruce DeJong, Finance Director Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 4 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 5 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 6 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 7 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 8 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 9 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 10 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 11 St. Louis Park City Council Study Session Discussion Item: 062507 - 3 - Long-Range Financial Planning Page 12 St. Louis Park City Council Study Session Discussion Item: 062507 - 4 - Novartis Update Page 1 4. Novartis Update Community Development The Nestle’s/Novartis Medical Nutrition location decision is moving forward very quickly. The first decision expected is the location of its headquarters. The location of the plant and research facilities will come later. Thursday afternoon staff will be meeting with Steve Drozda, the CFO for Novartis Medical Nutrition. Following that meeting we hope to know more about where things are headed, especially as it relates to the headquarters. We will provide a verbal update at Monday’s Council meeting. Novartis has about six months left on their office space lease with Duke and it does not look like they are going to renew it. This appears to be a Novartis choice and not Dukes - Duke has told us they have a tenant ready to backfill the space. Novartis is looking at buildings in Eden Prairie and Minnetonka for their offices. We are presenting to them a package which will include proposing that they consider the Real Estate Recycling building on the former Golden Auto site for its office headquarters. The building would meet Novartis’ needs as we know them, and at a competitive price. Prepared by: Kevin Locke, Community Development Director Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Written Report: 062507 - 5 - Metropoint Parking Lot Improvements Page 1 5. Metropoint Parking Lot Improvements Community Development PURPOSE OF REPORT: To inform and update the Council on improvements at the Metropoint office complex (Shelard area). BACKGROUND: The City received building permits for parking lot and building entrance improvements at the 600, 435, 400 and 300 buildings at the Metropoint office complex. The purpose of the building permits is to enhance the street appeal of the complex by providing a practical and professional main entrance for each building. The improvements include canopies and drop-off/pick-up lanes at each building and additional parking spaces at the 300 and 400 buildings. The proposed improvements are shown on the attached site plan in dashed outlines. The improvements require permits from the Building Inspections and Public Works Departments, and Council action is not required. It is anticipated that the work will be completed during the summer. Attachments: Site Plan Prepared by: Gary Morrison, Assistant Zoning Administrator Reviewed by: Meg McMonigal, Planning & Zoning Supervisor Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Written Report: 062507 - 5 - Metropoint Parking Lot Improvements Page 2 St. Louis Park City Council Study Session Written Report: 062507 - 6 - May 2007 Monthly Financial Report Page 1 6. May 2007 Monthly Financial Report Finance PURPOSE: This report is designed to provide summary information regarding the overall level of revenues and expenditures in both the General Fund and the Park and Recreation fund. These funds should be a primary concern in analyzing the city’s financial health because they represent the discretionary use of tax levy dollars. For the first five months of the year, actual revenues and expenditures should generally run about 42% of the annual budget. Significant items that exceed the norm are highlighted below along with a general discussion of the cause for the variance. General Fund Expenditures: • Finance expenditures are higher due to the hiring of a temporary employee from Accountemps to cover the departures of two of our accountants. • Community Development expenditures look high because an adjusting journal entry needs to be made to allocate some of the salaries back to the Development Fund. Parks and Recreation Expenditures: • Organized Recreation expenditures are higher due to gearing up for summer recreation programs. Attachments: Monthly Financial Reports Prepared by: Bruce M. DeJong, Finance Director Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Written Report: 062507 - 6 - May 2007 Monthly Financial Report Page 2 St. Louis Park City Council Study Session Written Report: 062507 - 6 - May 2007 Monthly Financial Report Page 3 St. Louis Park City Council Study Session Written Report: 062507 - 6 - May 2007 Monthly Financial Report Page 4 St. Louis Park City Council Study Session Written Report: 062507 - 7 - ParkWiFi Update Page 1 7. ParkWiFi Update Information Resources PURPOSE OF REPORT: The purpose of this report is to update the City Council on the status of ParkWiFi. BACKGROUND: Since the last update on May 29, the most significant pieces of news are: (1) construction has progressed on Phase 1 of ParkWiFi following May 7 Council direction and pole location criteria and (2) contrary to earlier hopes, Xcel Energy has found concerns in allowing the City to mount wireless radios on some of its poles. Xcel continues to review and consider whether it will allow any pole attachments in future phases. Due to time constraints, we will be unable to incorporate any such attachments into radios mounted in the First Mile or the remainder of Phase 1. Any ultimate use of Xcel poles would be limited to those locations where sunlight is insufficient to power the solar panels and the intersection Xcel pole location happens to provide radio signal coverage sufficient to cover the intended area. Use of Xcel poles would be minimized due to on- going pole attachment and energy fees, as well as cumbersome maintenance protocols. However, it is another potential tool. Phase 1 of the project, scheduled to go live July 21, includes the northeast section of the city – bounded by the east City limits, Brunswick Avenue on the west, the north City limits, and Minnetonka Boulevard on the south. Phase 1 also includes the triangle area east of Highway 100, south of Minnetonka Boulevard, and north of County Road 25. Most other significant information was included in the June / July issue of Park Perspective, which arrived at homes the first week of June. That issue included all details of the project delay, public process, and sample picture of the pole, component box, and solar panel. As of this writing, about 20 people have offered to host a wireless pole with solar panel on public right-of- way boulevard areas along their property. To the extent possible, we will include these sites in the final design of future phases. CURRENT STATUS: Construction continues with radios, batteries, and other components now being added to the poles and solar panels previously installed in the First Mile. Additional poles and solar panels are currently being located and will soon be installed in the remainder of Phase 1, generally north of Twin Lakes and west of Highway 100. Council-approved pole design and location criteria continue to be used. Some people continue to express concern over the poles, but fewer than before Council approved the pole location and design criteria. Core network equipment is being fine tuned to be tested in early July, brochures are being printed, and pilot and pre-registered subscribers are being contacted to ensure they are aware of the current status and receive instructions on acquiring needed equipment. Staff wishes to complete the testing and provisioning of Phase 1 subscribers, especially current pilot and pre- registered subscribers, and refine service before more aggressively recruiting additional subscribers. The goal is to build a system that works, and working with an initial group of subscribers makes that process much more achievable. There is much work left in the next 4 weeks to turn on Phase 1 on July 21. All parties are working very hard towards that goal. St. Louis Park City Council Study Session Written Report: 062507 - 7 - ParkWiFi Update Page 2 RECENT PUBLIC EVENTS: Staff attended three recent events to share information about ParkWiFi, listen to questions, and address concerns. Staff attended the June 12 Fire Department Open House, June 16 Kids’ Eco- Fair at Parktacular, and the June 20 Green Business Forum. In addition to sharing information about ParkWiFi, staff was especially interested to receive feedback from the hundreds of people who stopped by. Here are some highlights: • Very few (less than 10) people mentioned anything at all negative about the use of solar technology, including the poles and panels. And most of those folks understood the approach and suggested these poles and panels would soon blend into the community like so much infrastructure. Some people expressed pride that St. Louis Park would show such bold environmental stewardship, given expected opposition to the addition of poles. Only one individual engaged staff in a protracted conversation about the poles. Staff even prompted people for their views on the panels. • Perhaps the most hopeful story came from the first visitor to the Open House booth. She asked about the purpose of the solar panels. After staff provided her some information, she indicated that it was “cool” that the City was providing wireless this way and it was good for the earth and the environment. She indicated she was 6 years old and learned about solar and alternative energies in first grade. • Many people expressed concern over the delay in the project. Staff explained the need to fulfill the public process promise and sincerely incorporate suggestions made when possible. • A few people asked about plans to increase the speed of service offerings over time. Staff explained the inclusion of some pre-WIMAX equipment in this solution and the need for a successful implementation now to justify additional investments later. • Some residents fully expect others in the Internet service business to lower prices as ParkWiFi rolls out. This may happen, and would actually make Internet service in general more affordable. It would also be interesting to see if incumbents price services differently in places like St. Louis Park and Minneapolis, which will have completed their wireless projects by year’s end. • With respect to other providers, it is clear that there is much confusion over speed differences among dial-up, DSL, cable modem, satellite, and wi-fi services. ParkWiFi staff will seek to clarify this for subscribers to set appropriate expectations for ParkWiFi subscribers. St. Louis Park City Council Study Session Written Report: 062507 - 7 - ParkWiFi Update Page 3 • There exists some disinformation about the reason for the few tree removals done or being contemplated. Every effort is made to restrict tree activity to trimming, and minimize that. In one case in the First Mile, the disinformation heard by staff is that the City is removing healthy mature boulevard trees. The truth is staff trims when possible, and removed one boulevard tree when it was determined to be dying and would be removed within the next 12 months. Two new replacement trees will be planted in the same boulevard area by fall. • Most people expressed comprehension of the visual trade-offs sometimes necessary for environmental stewardship. It was also suggested that at some time in the future, it may be worth a “contest” to determine how to dress up the poles, perhaps adding art or some neighborhood icons of pride. • Some people expressed concern that adding poles with solar panels to the City would have the effect of lowering property values. Only time will tell if property values in St. Louis Park fall relative to other communities without poles with solar panels. The City Assessor has indicated he has seen no relationship between the addition of above-ground utilities and lowered property values. Some argue solar panels are different in this regard. • Finally, it was indicated by some that we may want the community to taste a little bit of the “gravy” of this project – the public safety and public service applications of ParkWiFi. We have been focused on the “turkey” – the retail offering – and the gravy may help others not interested in the retail service see broader benefits of ParkWiFi and be more inclined to support this communitywide service. This suggestion is validated by the fact that the goal is to break-even financially on this service at about 32% of residences and 15% of businesses, well under a majority of either group. St. Louis Park staff will ponder some options. It was very helpful to have face-to-face interaction in these events. Staff came away feeling that, while there will continue to be some who feel the addition of new poles with solar panels cannot be justified, most feedback suggests the reasons behind the service continue to be worthwhile, even with some of the aesthetic trade-offs connected with environmental stewardship. Prepared by: Clint Pires, Chief Information Officer Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 1 8. Sidewalk Snow Removal Enforcement Program Update Public Works PURPOSE OF REPORT: To provide Council with a year-end report on the sidewalk snow removal enforcement program. BACKGROUND: The City of St. Louis Park’s goal in providing a city-wide sidewalk system is to provide the reasonably prudent person with an alternative to walking in the street. With regard to snow and ice removal, sidewalk surfaces do not need to be bare, but they do need to be passable/walkable. Since the City maintains less than half of the entire sidewalk system, Council determined the best way to encourage property owners to clean their sidewalks was through aggressive education and enforcement programs. As part of the program development process, staff presented Council with several different snow removal enforcement options. Council reviewed the information presented and adopted the attached resolution reflecting their preferred direction (Appendix A). As part of the discussion preceding the adoption of the resolution, Council requested feedback in the form of a year-end analysis report. DISCUSSION: This report specifically addresses each of the expectations detailed in the adopted resolution as well as other information staff feels is pertinent to a thorough understanding of program results. • Sidewalks should be inspected at 2” loose accumulation of snow o A two-inch depth proved to be a good break between nuisance snow falls and snowfall depths impacting pedestrian travel. • Approximately 25% of the sidewalk system should be inspected after each snow event plus locations which receive complaints o Sidewalks were inspected by ward. o Although inspecting by ward did not necessarily reflect a consistent number of citable properties within each area, it did provide for easily recognizable boundaries and for meaningful results to each of the ward council members. o City-wide, 13 complaints were received from residents about another property not having shoveled their sidewalk (highlighted in yellow in Appendix F). • The minimum width of sidewalk cleared should be 3’ wide o There were no issues surrounding a minimum of a 3’ width as an acceptable level of effort. o Sidewalks cleaned by abatement were cleaned to the full width of the sidewalk. • The sidewalks should be inspected as soon as possible, but no later than the second day of the street plowing effort o Sidewalks in Wards 1-3 were all inspected on either the first or second day of the street plowing effort. o Unfortunately, the large storms on Feb 25 and Mar 1 caused considerable delays in the City’s ability to clear city-maintained sidewalks. This created respective delays in enforcing the sidewalks in Ward 4 (staff did not enforce privately-maintained sidewalks until city-maintained sidewalks were cleared). St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 2 • In keeping with past practice, educational letters will be sent (in lieu of citations) for first-time offenders o All first-time offenders received educational letters (Appendix B) in lieu of citations. o Repeat offenders received citations (Appendix C). o In addition to providing first time offenders with an educational letter, an extensive public information campaign was conducted that included a city-wide mailer (Appendix D) to all citable addresses, Park Perspective articles, and a Cable TV spot. • If a resident either refuses to do so or is unavailable to do so (i.e. out of town), the city will abate (remove) snow-related nuisances approximately two days after citation service o The city did have to abate some sections of sidewalk by contract. This action was relatively rare and was typically the result of out-of-town property owners, properties up for sale, or local stores owned by out-of-state corporations. o Door hangers were left at all non-compliant addresses (Appendix E) so property owners had the maximum time possible to clear their sidewalks before being re- inspected and possibly invoiced for abatement by the city. • As with other practices, the city will not provide special treatment for residents who are seniors/disabled/disadvantaged. Services are available through programs such as STEP, HOME, or community/neighborhood volunteer networks (if they exist) o Although matching up property owners in need of help with available assistance created some confusion at first, a workable system was developed and functioned with minimal problems for the remainder of the winter season. o Community Outreach personnel worked very hard to match up residents in need of assistance with local volunteers. Additional Issues of Note: • The most difficult properties to work with were commercial properties with out-of-state corporate headquarters. For large corporations, the relatively low cost associated with the citation and ensuing abatement, made it easier for them to ignore the problem and pay the fine than address it at a corporate level. Fortunately, these situations were very rare and do not warrant revisions to the program at this time. Staff will continue to closely monitor commercial properties and may recommend future revisions to the program if conditions warrant. • Very few complaints were received regarding the sidewalk snow removal enforcement program. Most complaints involved property owners appealing their “Educational Letter” and had no further comment when informed there was no fine associated with a first time offense. St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 3 Summarized Metric Information: Snow Snow Inspection Non- Citable Percent Ward Date Depth Date Compliant Addresses Compliant Ward One 12/31/06 2.75” 1/2/07 64 1806 96.5% Ward Two 1/15/07 2.75 1/16/07 35 1424 97.5% Ward Three 2/6/07 2.25 2/8/07 83 1310 93.7% Ward Four 2/25/07 9.8” 2/28/07 0 66 100% Ward One 3/1/07 14.5” 3/7/07 10 1806 99.4% Overall Average: 97% Total Non-Compliant Addresses: 222 Educational Letters: 203 Citations Sent: 19 Abatements Required: 21 Detailed metric information can be found in the attached tables (Appendix F). Approximate Program Costs*: Inspector (Temporary Employee): $12,700 General Office Supplies (printing/postage costs): $450 *The above program costs are directly impacted by the frequency and amount of snow falls and are expected to fluctuate in subsequent seasons. SUMMARY: Overall compliance was very high, averaging just over 97%. Additionally, the frequency of both required abatements and repeat offenders was very low. All of which indicates the majority of our property owners are diligent and supportive of the need to keep our public sidewalk system as clear as possible. As such, staff feels the sidewalk snow removal enforcement program was a great success and does not recommend any program changes at this time. It needs to be noted that ordinance requirements for clearing snow from sidewalks can not be met by residents or by city forces during heavy snow events. This was experienced during both the February 25th and March 1st storms earlier this year. Staff intends to discuss this issue with Council during the budget process later this year. Attachments: Appendix A: Program Policy Resolution Appendix B: Non-Compliance Educational Letter Appendix C: Notice of Violation (NOV) Appendix D: City-wide Educational Mailer Appendix E: Door Hanger Appendix F: Additional Metrics Information Prepared by: Mark P. Hanson, P.E., Public Works Operations Superintendent Reviewed by: Michael P. Rardin, P.E., Public Works Director Approved by: Tom Harmening, City Manager St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 4 RESOLUTION NO. 06-071 SNOW AND ICE REMOVAL ENFORCEMENT POLICY RELATING TO PUBLIC SIDEWALKS IN THE CITY OF ST. LOUIS PARK WHEREAS, The City Ordinance Section 24-342 establishes sidewalk snow removal requirements for public sidewalks; and WHEREAS, The City Council wishes to ensure safe, efficient and cost effective sidewalk snow removal on public right-of-way in St. Louis Park, NOW THEREFORE BE IT RESOLVED, that the City of St. Louis Park Public Works Department, in cooperation/coordination with other City Departments, is directed as follows: • To inspect sidewalks at 2” loose accumulation of snow, • To inspect approximately 25% of the sidewalk system after each snow event plus locations which receive complaints, • The minimum width of sidewalk cleared should be 3’ wide, • To inspect the sidewalks as soon as possible, but no later than the second day of street plowing, • In keeping with past practice, educational letters will be sent (in lieu of citations) for first- time offenders, • If sidewalks are not cleaned, the city will abate (remove) snow-related nuisances approximately two days after citation service, cost to be assessed to property owner. • As with other practices, the city will not provide special treatment for any residents, BE IT FURTHER RESOLVED, that this policy becomes effective immediately upon passage of this resolution. Reviewed for Administration: Adopted by the City Council April 3, 2006 City Manager Mayor Attest: City Clerk Appendix A: Program Policy Resolution St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 5 Appendix B: Non-Compliance Educational Letter St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 6 Appendix C: Notice of Violation (NOV) St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 7 Appendix D: City-Wide Educational Mailer St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 8 Appendix E: Sidewalk Snow Removal Door Hanger St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 9 St. Louis Park City Council Study Session Written Report: 062507 - 8 - Sidewalk Snow Removal Enforcement Program Update Page 10