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HomeMy WebLinkAbout14.A. Amendment to Subdivision Ordinance regarding Park Dedication Fees-Ord. No. 720 ft.A. CITY OF SHAKOPEE Memorandum CASE LOG NO.: 05009 CONSENT TO: Mayor and City Council Mark McNeill, City Administrator FROM: R. Michael Leek, Community Development Director .., SUBJECT: Amendment to City Code Chapter 12, Sec. 12.34, PARKS AND DEDICATION MEETING DATE: January 18, 2005 INTRODUCTION: The Parks and Recreation Advisory Board (pRAB) and the Planning Commission have recommended an amendment to that portion of the City Code that establishes park dedication requirements. DISCUSSION: Attached to this report for the Council's information is a copy of the report provided to the Planning Commission regarding the proposed text amendment. The most significant changes proposed are; . The elimination of deferral of payment to the time of building permit application; and . Clarification of the definition of fair market value for purposes of calculating equivalent cash dedication. PLANNING COMMISSION RECOMMENDATION: The Planning Commission reviewed this request at their December 9, 2004 and January 6, 2005 meetings, and by unanimous vote, recommended approval of the request as presented by the PRAB and Mr. Themig. ALTERNATIVES: 1. Approve Ordinance No. 720, an ordinance approving the text amendment modifying City Code Sec. 12.34 as presented. 2. Approve Ordinance No. 720, an ordinance approving the text amendment modifying City Code Sec. 12.34 with revisions. 3. Deny the text amendment. 4. Table the matter for additional information. ACTION REQUESTED: Offer and pass a motion approving Ordinance No. 720, an ordinance approving the text amendment modifying City Code Sec. 12.34 as presented. ORDINANCE NO. 720. FOURTH SERIES AN ORDINANCE OF THE CITY OF SHAKOPEE. MINNESOTA. AMENDING CHAPTER 12. SEC. 12.34. PARKS AND DEDICATIONS THE CITY COUNCIL OF THE CITY OF SHAKOPEE. MINNESOTA. ORDAINS: Section 1 - That City Code Chapter 12.Sec. 12.34. PARKS AND DEDICATIONS is hereby amended by addinq the lanquaqe. which is underlined. and deleting the languaqe that is struck throuqh. SEC. 12.34. PARKS AND DEDICATIONS. Subd. 1. Purpose. The City Council recognizes it is essential to the health, safety and welfare of the ~sidents of the City of Shakopee that the character and quality of the environment be:~onsidered to be of major importance in the planning and development of the City. In this regard, the manner in which land is developed and used is of high priority. The presentation of land for park, playground, public open space purposes and trails as it relates to the use and development of land for residential, commercial and industrial purposes is essential to the maintaining of a healthful and desirable environment for all residents of the City. We must not only provide these amenities for our citizens today, we must be mindful of our future citizens. The City Council should recognize that demand for park, playground, public open space and trails within a municipality is directly related to density and intensity of development permitted and allowed within any given area. Urban type developments mean greater numbers of people and higher demands for park, playground, public open space and trails. To disregard this principle is to inevitably over-tax existing facilities and thus diminish the quality of the environment for all residents. Subd. 2. Standards for Acceptina Dedication of Land for Public Purposes. It should be the policy of the City of Shakopee that the following standards and guidelines for the dedication of land for park, playground, and open space purposes (or cash contribution in lieu of such dedications) in the subdividing and developing of land within the City shall be directly related to density and intensity of each subdivision and development. A. As a prerequisite to subdivision approval, subdividers shall dedicate land for parks, playgrounds, public open spaces and trails and/or shall make a cash contribution to the City's park fund and trail fund as provided by this section. B. Land to be dedicated shall be reasonably suitable for its intended use and shall be at a location convenient to the people to be served. Factors used in evaluating the adequacy of the proposed park and recreation areas shall include size, shape, topography, geology, hydrology, tree cover, access and location. C. The Parks and Recreation Advisory Board shall recommend to the Planning Commission and City Council the land dedication and cash contribution requirements for proposed subdivisions. D. Changes to the density of plats shall be reviewed by the Parks and Recreation Advisory Board for reconsideration of park dedication and cash contribution requirements. E. When a proposed park, playground, recreational area, school site or other public ground has been indicated in the City's official map or Comprehensive Plan and is located in whole or in part within a proposed plat, it shall be designated as such on the plat and shall be dedicated to the appropriate governmental unit. If the subdivider elects not to dedicate an area in excess of the land required hereunder for such proposed site, the City may consider acquiring the site through purchase or condemnation. F. Land conveyed or dedicated to the City shall not be used in calculating density requirements of the City zoning ordinance, and shall be in addition to and not in lieu of open space requirements for planned unit developments. G. When private open space for park and recreation purposes is provided in a proposed subdivision, such areas may be used for credit, at the discretion of the City Council, against the requirements of dedication for park purposes, provided the City Council finds it is in the public interest to do so. H. The City, upon consideration of the particular type of development, may require larger or lesser parcels of land to be dedicated if the City determines that present or future residents would require greater or lesser land for park and playground purposes. I. In residential plats, the City of Shakopee shall have a standard of one (1) acre of park land for every seventy-five (75) people. Thus, one (1) acre of land shall be conveyed to the City as an outlot warranty for every seventy- five (75) people the platted land could house based on the following population calculations: Single-family detached dwelling lots 3.0 persons per lot Duplex-Twin homes 3.0 persons per dwelling unit Apartments, Townhouses, Condominiums, other multiple family dwelling units 1 person per bedroom J. In plats other than residential, the City hereby finds that, as a general rule, it requires that an amount of land equal to 10% of the undeveloped land proposed to be subdivided be dedicated or reserved to the public for public use for parks, playgrounds, trails, wetlands or open space. Should the land to be dedicated have greater fair market value than the average fair market value in the plat, the City shall only be authorized to require dedication of an amount of land equal to 10% of the fair market value of all the property being platted. K. In lieu of park land donation, the City may require an equivalent cash donation based upon ::weroge undeveloped land value in the City the I averaqe fair market value of undeveloped land that is. or under the City's adopted comprehensive plan. may be served bv municipal sanitary sewer I and water service. The cash dedication requirement shall be established annually by the City Council. L. In lieu of trail donation, trail construction, or trail easement dedication, the City may require a cash donation for the trail system. The cash dedication requirement shall be established annually by the City Council. Dedication for trails in the form of cash shall apply only to residential plats. M. The City may elect to receive a combination of land and cash.:.-, land and de'.'elopment land for park use. The fair market value. of land the City 'Nants and the value of the development of land shall be calculated. That amount shall be subtrocted from the cash contribution required by subsection K above. The remainder shall be the cash contribution requirement. The city shall determine the amount of land dedication it requires, and the cash contribution shall be calculated based on the percentaqe of unmet land dedication. N.Foir morket value shall be determined as of the time of filing the finol plat in accordance with the following order of preference: 1.the price the subject land sold for within the past year; 2.based on the average fair market '.tolue of undeveloped City residential proporty by zoning clossificotion, served by mojor City utilities; 3.on approisal performed for or on beholf of the City 'Nithin the past year; !l.an appraisal performed fDr or on behalf of the subdivider within the past yeaF:- The f:::tir morket value determination shall exclude any value added to such land within the past year fDr improvements serving such land. <hN. Planned unit developments with mixed land uses shall make cash and/or land contributions in accordance with this section based upon the percentage of land devoted to the various uses. P.O. Park and trail cash contributions are to be calculated based on the fees in I place at the time of the final plat approval. Q..P. The cash contributions for parks and trails shall be deposited in either the I City's park development fund or multi-purpose pedestrian fund and shall be used only for park acquisition or development and trail acquisition and development. R.Q. If a subdivider is unwilling or unable to make a commitment to the City as to I the type of building that will be constructed on lots in the proposed plat, the land and cash contribution will be a reasonable amount determined by the City Council. SoR. Wetland, ponding areas, drainageways accepted by the City shall not be I considered in the park land and/or cash contribution to the City. =hS. When a proposed trail has been indicated in the City's official I Comprehensive Plan Map, and it is located in whole or in part within the proposed plat, it should be designated on the plat and should be dedicated to the City. If the subdivider elects not to dedicate an area in excess of the land required for a trail, the City may consider acquiring it through condemnation. I Y-.+. Required land dedication and/or payment of fees in lieu of land dedication shall be required at the time of recordinq the final Q:!ilisubdivision ::Ipprov31. However, ::It the request of any party submitting a plat, the council may, at it's exclusive discretion, enter into a contractual agreement with said Developer to ::IlIo,^, said poyment to be deferred until 0 building permit or permits are issued f-or the lots in s::lid plat. Any such deferment sholl bo in occordance with the park dedication foes in effoct ot the time of issuance of the building permit(s). Section 2 - - Effective Date. This ordinance becomes effective from and after its passage and publication. Adopted in session of the City Council of the City of Shakopee, Minnesota held the day of ,2005. Mayor of the City of Shakopee ATTEST: City Clerk Published in the Shakopee Vallev News on the day of ,2005. " /1 fl. . oN tvt'vJ L \:. CITY OF SHAKOPEE MEMORANDUM To: Planning Commission Michael Leek, Community Development Director From: Mark Themig, Parks, Recreation and Facilities Director Date: November 29, 2004 Subject: Park Dedication Ordinance Text Amendment INTRODUCTION The Parks and Recreation Advisory Board is recommending text amendments to Section 12.34 of the City's code relating to park dedication. The proposed text amendments: . Change the formula for how credits are calculated in a land and cash contribution scenario. . Clarify that the park dedication fee is based on the average fair market value of undeveloped land that is, or under the City's adopted comprehensive plan, may be served by municipal sanitary sewer and water service. . Clarify that park dedication is calculated at time of final plat approval. This proposed change also eliminates the ability to defer park dedication payment until building permit. BACKGROUND In late 2003 and early 2004, the Parks and Recreation Advisory Board reviewed development proposals where the developer wanted to meet park dedication requirements through a combination of land and cash contributions (Riverside Fields, Church Addition, Valley Creek Crossing). While the combination of land and cash was generally acceptable, the formula in the ordinance creates an equity issue. As the ordinance is written, the city can require a park land dedication, cash contribution, or combination of land and cash. The land dedication and cash contribution are straightforward: Land Contribution Section 12.34, Subd. 2.1. and 2.J. "In residential plats, the City of Shakopee shall have a standard of one (1) acre of park land for every seventy-five (75) people. Thus, one (1) acre of land shall be conveyed to the City as an outlot warranty for every seventy-five (75) people the platted land could house based on the following population calculations: . Single-family detached dwelling lots 3.0 persons per lot, . Duplex-Twin homes 3.0 persons per dwelling unit . Apartments, Townhouses, Condominiums, other multiple family dwelling units 1 person per bedroom . In plats other than residential, the City hereby finds that, as a general rule, it requires that an amount of land equal to 10% of the undeveloped land proposed to be subdivided be dedicated or reserved to the public for public use for parks, playgrounds, trails, wetlands or open space. Should the land to be dedicated have greater fair market value than the average fair market value in the plat, the City shall only be authorized to require dedication of an amount of land equal to 10% of the fair market value of all the property being platted." (The city typically hasn't required land dedication for commercial/industrial plats.) Cash Contributions , Section 12.34, Subd. 2.K. "In lieu of park land donation, the City may require an equivalent cash donation based upon average undeveloped land value in the City. The cash dedication requirement shall be established annually by the City Council." Each year, the Parks and Recreation Advisory Board reviews recent land transaction sales and recommends a fee that is based on those transactions .........-......--...........-- (See Attachment B). ......___._.........._............._____...____.__......._.__...__...._.____.__.__._U_"'.. ................ _......_................._....................... ....._. The land value becomes an issue when the City is requesting a combination of land and cash. Current ordinance provides for a credit to a developer when a combination of land and cash is provided (Section 12.34, Sub 1): Land and Cash Contributions K. "In lieu of park land donation, the City may require an equivalent cash donation based upon average undeveloped land value in the City. The cash dedication requirement shall be established annually by the City Council. M. The City may elect to receive a combination of cash, land and development land for park use. The fair market value of land the City wants and the value of the development of land shall be calculated. That amount shall be subtracted from the cash contribution required by subsection K above. The remainder shall be the cash contribution requirement. N. Fair market value shall be determined as of the time of filing the final plat in accordance with the following order of preference: 1. the price the subject land sold for within the past year; 2. based on the average fair market value of undeveloped City residential property by zoning classification, served by major City utilities; 3. an appraisal performed for or on behalf of the City within the past year; 4. an appraisal performed for or on behalf of the subdivider within the past year. The fair market value determination shall exclude any value added to such land within the past year for improvements serving such land." DISCUSSION The problem with the formula in the ordinance is that the fair market value of the land that the credit is based on is typically higher than the average undeveloped land value used to calculate the park dedication fee. In other words, the developer is getting credit . for the land they dedicate at a higher price than the value of the land used to calculate the cash contribution. Proposed Changes In order to address the inequity between "fair market value" used for the credit and "average undeveloped land values" used to calculate the park dedication fee amount, the Parks and Recreation Advisory Board reviewed a text amendment that uses the average undeveloped land values for calculating the credit a developer receives. One option that we considered was using the actual purchase price of the land for calculating the park dedication fee. In working with City Attorney Jim Thomson, he indicated that tying the park dedication fee to the purchase price of the land was too subjective and could be challenged because developers would be assessed different park dedication costs based on the value of the land. After further work with Mr. Thomson, we are proposing a text amendment that bases the cash contribution on the percentage of unmet land dedication. For example, if a developer was required to provide ten acres of land, but they only provided six acres ,U (E5Q% ()fJDl:lir rl:l9\:li.rl:lIJl..<:lDt),_ the. re.l11~ining_(;..?_shc()ntribution would be 40% of thetot~J_______________.____,__, cash contribution required. The following are two examples to illustrate the current formula and the proposed changes. These illustrations are based on the 2004 park dedication fees: Illustration 1 . 80 acre development with fair market value of the land based on sale price = $150,000 . 200 single-family units . Total number of acres of park land that could be required: 200 units X 3 people per unit 175 people per acre = 8 acres of park land . Advisory Board requests 6 acres of park land with the balance in cash. CURRENT FORMULA: Calculation for credit given to developer under current ordinance and 2004 fee: Cash contribution that could be required: 200 units X $3,615/unit =$723,000 Fair market value for 6 acres being requested: 6 acres X $150,000/acre =$900,000 Result = $900,000 credit for 6 acres would exceed cash requirement, so the developer is not required to provide any cash. PROPOSED FORMULA: Calculation for credit given to developer under proposed ordinance change and 2004 fee: Cash contribution that could be required: 200 units X $3,615/unit =$723,000 % of park dedication met: 6 acres being provided out of 8 acres required =75% Remaining contribution: 25% of $723,000 =$180,750 Result = $180,750 cash contribution to meet full requirement. Illustration 2 . 150 acre development with fair market value of the land based on sale price = $150,000 . 440 single-family units . Total number of acres of park land that could be required: 440 units X 3 people per unit 175 people per acre = 17.6 acres of park land . Advisory Board requests 10 acres of park land with the balance in cash. . , CURRENT FORMULA: Calculation for credit given to developer under current ordinance and 2004 fee: Cash contribution that could be required: 440 units X $3,615/unit =$1,590,600 Fair market value for 10 acres being requested: 10 acres X $150,000/acre =$1,500,000 Result = $90,600 cash contribution required to meet full requirement. PROPOSED FORUMLA: Calculation for credit given to developer under proposed ordinance change and 2004 fee: Cash contribution that could be required: 440 units X $3,615/unit =$1,590,600 % of park dedication met: 10 acres being provided out of 17.6 acres required =56.8% Remaining contribution: 43.2% of $1,590,600 =$687,139 Result = $687,139 cash contribution to meet full requirement. We are also proposing two other text amendments to the ordinance: . Sect. 12.34, Subd. 2.K.: Clarifies that park dedication fee is based on the average fair market value of undeveloped land that is, or under the City's adopted comprehensive plan, may be served by municipal sanitary sewer and water service. This text change clarifies what land values are used to calculate park dedication "',.....T~q~JE~E~!~I"!!~~_..- "'__." n ",', . n ..... .., ..... .n_h. .. ...__ .-.. -...."" . Sect. 12.34, Subd. 2.U.: Clarifies that park dedication is calculated at time of final plat approval. This text change clarifies when park dedication is calculated, consistent with state statute. In addition, we are proposing to remove the ability for developers to defer payment of park dedication fees until building permits are issued. By removing this condition, we will have better accountability for park dedication revenue, and be able to begin using that revenue immediatelyfor park development. Attachment A contains the proposed changes. REQUESTED ACTION The Planning Commission is asked to conduct a public hearing on the proposed text amendment, and make a recommendation to City Council.