WORKSHOP ITEM: 2 - Jim Kappelhoff, Park and Recreation Director
Title
ESTABLISHING PARK DEDICATION FEES FOR 2012
Background
At the beginning of each year City Council adjusts the park dedication fees by the percent of increase in the fair market value of undeveloped land within the City and any increase must not exceed 10%. This has been established by Resolution since 2003. However, an increase in fees must now be placed in the fee schedule that is updated annually by Ordinance rather than a Resolution, requiring first and second readings. Revenue for the capital improvement plan for both parks and open space comes from the park dedication fees. Since the Park Board is recommending an increase in park dedication fees for 2012, staff felt a CC workshop setting rather than a CC regular meeting would better serve a discussion on increasing fees.
The Park Board recommended the City Council approve an increase in the park dedication fees for 2012, based on the following:
• Dedication fees have not increased for the past 3 years and at the same time, according to the County Assessing Department, Blaine’s development is ahead of all County cities. In addition, according to Economic Development data, Blaine is ranked 2nd in the state for new residential units.
• Blaine is ranked 12th out of 13 metro cities recently surveyed in residential park dedication fees and ranked in the middle of the cities for commercial fees. This has been consistent for the last several years. It may be appropriate to start increasing park dedication fees in an effort to start approaching the fees of other communities similar in size and development, particularly in residential units.
• An analysis of the City’s future development was conducted by the Planning Department and based on the 2030 Comp Plan. The analysis showed that the City’s estimated development for the period 2010-2015 should average 319 residential units and 30 acres of commercial/industrial per year. Future park, open space and trail development should keep pace with this growth through measured annual increases in park dedication fees.
To illustrate the effect of increasing park dedication fees staff created two charts. The first is the result on Fee Rates and the other is on Park Fund Balance Projections. The increase was from 1% to 5% as it was the Park Board’s consensus not to exceed 5%.
Fee Rates: The following table shows how the increases would affect the fee rates and were used in estimating balance projections.
|
Development |
Current |
1% |
2% |
3% |
4% |
5% |
|
Residential |
$2,435 |
$2,459 |
$2,484 |
$2,508 |
$2,532 |
$2,557 |
|
Commercial |
$7,163 |
$7,235 |
$7,306 |
$7,378 |
$7,450 |
$7,521 |
|
Industrial |
$4,870 |
$4,919 |
$4,967 |
$5,016 |
$5,065 |
$5,113 |
Park Fund Balance Projections (Attachment): Park fund balance projections are based on the 2012-2016 Capital Improvement Plan. The projections are in three (3) different categories of increases; Residential Development Only, Commercial/Industrial and Residential Development, and All Development. Also it is estimated that development in the City of Blaine will be 75% residential, 20% commercial and 5% industrial in the next ten years. These percentages are calculated in with the fund balance projections.
Based on this information, the Park Board has recommended the City Council approve an increase in establishing park dedication fees for 2012 at 5% per residential unit and 3% for commercial/industrial per acre. Comparative results of this increase follows:
|
Development |
2011 |
2012 |
|
Residential |
$2,435 |
$2,557 |
|
Commercial |
$7,163 |
$7,378 |
|
Industrial |
$4,870 |
$5,016 |
DISCUSSION POINTS:
1. Would the City Council consider approving the Park Board recommendation of a 5% fee increase in per residential unit and a 3% fee increase in per commercial/industrial acre?
2. Or would the City Council approve a different percentage fee increase for residential units and commercial/industrial acres from the Park Board’s recommendation?
3. Or does the City Council feel a no increase in all park dedication fees for 2012 is the best option at this time?
COUNCIL DIRECTION TO STAFF:
Proceed with establishing the Park Dedication fees for 2012 with an increase or no increase.