13. Storm Sewer Assessment StudyAgenda -July 7, 1997
AGENDA ITEM 13 - STORM SEWER ASSESSMENT STUDY -TABLED FROM JUNE 2,
1997
BACKGROUNDICONSIDERATION: As we indicated in June, we would have
the Internal Staff Committee review the Street Maintenance
Assessment Program just as we did with the Storm Sewer Assessment.
I have enclosed the report you received for the June 2 meeting in
reference to the Storm Sewer Study. I have also enclosed the new
Study Committee's report on the Special Street Maintenance.
The Committee report is thorough and there is no need for me to
repeat that information. However, I instructed the Committee to
investigate a budget revenue neutral option to assure us of
receiving the current maintenance funds for us to continue our
current level of services.
The staff has reviewed both assessment processes and submitted
reports to you. We now need your direction. Do you want us to
proceed with the current formulas? Would you prefer we continue to
implement changes to the formula? I would presume any changes
would be "revenue neutral".
RECOMMENDATION: My recommendation at this time is to continue with
the current formula for the Storm Sewer Assessment. This is as
"fair and equitable" a formula that, I believe, we can utilize. On
the other hand, the Street Assessment Schedule appears to be less
equitable. I would recommend a "maximum" assessment be used.
Agenda -July 7, 1997
Since these reports are not comprehensive but are used to
illustrate the formulas and their potential impact, I agree with
the Committee and would suggest that, if you desire a change, you
allow us to complete this change during the Fall/Winter work
schedule. I would suggest a February 16, 1998 deadline for all
changes to be adopted by the Council.
ACTION REQUIRED: Direction to Staff - formal changes in ordinances,
etc. will need to be approved at a later date to completely
implement any changes.
13
Date: July 3, 1997
To: Clarence Krepps, City Manager
From: John Wilson, Assistant City Engineer tAk-4d
Re: Special Street Maintenance Assessment Review
Executive Summary
The Special Street Maintenance Assessment Review Committee gathered for a second meeting on
Tuesday, June 24th. In attendance were Ad Clark, Larry Gallagher, Amy Robertson and myself. We
reviewed the discussions of the first meeting before moving on to consider new assessment options.
Throughout the committee meetings we have agreed on a goal to develop street maintenance
assessments with the greatest possible correlation to traffic generation. Given the limitations imposed
by State law, the most practical assessment formula to meet this goal appears to be based on square
footage, with multiple assessment rates for various zoning designations and carefully applied ceilings
to distribute costs as fairly as possible.
If the City Council directs staff to design and implement a new special street maintenance assessment
program, we must allow a schedule appropriate to such a huge, important task. Staff requests the
project be scheduled as a Fall/Winter activity with a deadline to coincide with the spring budget
review. The details of a new assessment method must be carefully considered to create a program
which distributes costs fairly, is practical to administer, easy to understand and free of unexpected
consequences. We must also be aware the implementation of a new assessment program will involve a
tremendous effort to research thousands of individual properties, record new descriptive data and
revise the County's assessment software.
Assessment Options
In both of our meetings discussion centered around the idea of using parking requirements or trip
generation standards as demand related criteria in the assessment formula. However, it was discovered
after the second meeting that State law restricts our choice of assessment criteria to the following:
square footage, which is the basis of our current ordinance,
front footage,
taxable valuation,
some combination of these three or
an equal division of costs among the parcels of the district.
Parking requirements and trip generation are not approved criteria under the Montana Code.
Assessments based on front footage or equal division of costs seem to bear no relationship to traffic
generation and were not given serious consideration.
The use of taxable valuation was discussed as a means of reducing assessments for large vacant tracts.
Although this would reduce fees for some land owners, we would simply be shifting costs to other
property owners without improving our ability to set fees in uniform proportion to the services
received. This method may also fail to provide assessments for tax exempt properties.
The law allows us to develop an assessment formula with different weighting factors for square
footage, front footage and/or taxable valuation. However, staff believes this method would have the
disadvantages of front footage and taxable valuation assessments, while producing a complex formula,
more difficult to administer and harder to understand.
With respect to current concerns about special street maintenance assessments for vacant tracts, we
have considered a short term adjustment using a ceiling for single family residential and vacant tracts
one acre in size or larger. A spreadsheet is attached showing assessor numbers for single family
residential and vacant tracts one acre and larger, the area of each tract, current assessments and
assessments with the current rate combined with a one acre ceiling.
If the current assessment factor of $0.0045 per square foot was applied with a one acre ceiling 79
properties would see their annual street maintenance assessment reduced to $196.02. Unfortunately
this would reduce our total annual street maintenance revenue by approximately $41,200.
We could avoid this revenue loss by increasing the assessment factor to $0.0051 per square foot
throughout the district and a one acre ceiling would create a $222.16 maximum assessment for single
family residential and vacant parcels. The 13 assessments shaded on the spreadsheet and all other
street maintenance assessments in the City would increase by 13.3% as a result of this change. The
last page of the spreadsheet explains our derivation of the $0.0051/sq.ft. rate.
Practices in Other Montana Cities
We discussed special street maintenance assessments with our counterparts in Billings and Bozeman.
Their programs are based on square footage with provisions for maximum assessments and multiple
assessment rates. Billings has designated two districts, one for the downtown area and one for the
remainder of the City. The downtown district is assessed at a higher rate corresponding to the higher
level of maintenance provided in that area. Each district is administered as a separate entity and
assessments are expended in the district from which they are collected. The Billings ordinance also
provides a maximum annual assessment for vacant tracts of land. Copies of two Billings street
maintenance assessment resolutions and related sections of the Billings Municipal Code are attached.
Bozeman's program is also based on square footage with provisions for maximum assessments, but
they have a city wide district divided into several assessment categories with respect to zoning
designation. A memo describing their Street Maintenance District Program is also attached.
Mrs. Peters' Letter of April 16,1997
At the regular City Council meeting on June 2nd Carlene Peters presented the Council with copies of a
letter which we received in late April. That letter was her request to reduce the special street
maintenance and storm sewer assessments against her 5 acre tract on Grandview Drive. We have
spoken with Mrs. Peters on several occasions and understand her greatest concern to be with the street
maintenance assessments.
She makes a point that her neighbor, who has a parcel approximately %2 the size of hers, pays an
assessment much less than'/z of what she pays. We investigated this issue and found the area for her
neighbor's parcel was in error on the plat. This error has been corrected and her neighbor's
assessments will increase next year.
2
Mrs. Peters is very concerned that her street maintenance assessment is one of the highest in the City.
We agree this does not seem fair and have applied her parcel as a "test gauge" for every assessment
strategy we have considered. Using the scheme described above for a one acre assessment ceiling, she
would be assessed $222.16 per year. This would be a $757.94 reduction from her most recent fee of
$980.10. If we were to implement a system such as Bozeman's her assessment might be reduced
much further.
We do not share the opinion that her storm sewer assessment is "out of reason compared to all other
homeowners." She compares her assessment for a 5 acre tract to the "average" assessment that would
result from an equal division of costs among all City parcels. There is simply no equity in an equal
apportionment strategy and it is not a valid basis for comparison. Our present storm drainage
assessment includes four categories which account for typical surface runoff characteristics. Under the
restrictions imposed on local assessments by State law, this is a reasonable method to quantify storm
drainage impacts.
She calculates her storm drainage assessment to be 6.5 times more than the "average." One should
also note her property is 29 times larger than a typical residential lot in the heart of town. In the end,
all the conflicting averages and comparisons can best serve to demonstrate the complexity of devising
a perfectly equitable distribution of costs.
In general, staff agrees with Mrs. Peters' contention that Special Street Maintenance Assessments are
disproportionately high for large single family residential and vacant tracts. Her case against Storm
Sewer Assessments is less compelling. However, our previous recommendation for a one acre
maximum storm sewer assessment for single family residential and vacant tracts would provide some
relief, if the Council so desires.
Conclusions
Although our present special street maintenance assessment policy distributes costs uniformly on the
basis of square footage, it is generally agreed traffic generation should be considered to distribute costs
in reasonable proportion to the services received. It is also agreed our assessment policy should be
practical to administer and easy to understand. Staff believes these goals may be met with a program
similar to Bozeman's, providing a city wide street maintenance district and an assessment formula
based on square footage, with multiple assessment categories and designated maximum assessments.
However, we must keep in mind the final details of any revised assessment program might be
influenced by practical limitations of the County's computerized tax system.
Please note this would create a street maintenance assessment program very similar to our current
storm drainage assessment policy, with a formula based on square footage and multiple assessment
categories. In fact objections to that program were the starting point for our whole examination of
special assessments. This illustrates the point that in spite of our best efforts to devise a fair and
practical assessment program, some exceptions can always be found.
Such a fundamental change in assessment policy would be a major undertaking and should not be
rushed. If the City Council chooses to take this course, staff requests the project be scheduled as a
Fall/Winter activity with a deadline to coincide with the spring budget review.
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7-02-1-397 8:204H FR011 ZIIT'(- 0= BI-LINSS 421S 657 6252
P. 2
RESOLUTION NO V 4-a-
A R29=TION' OF 71HE CITY CF 9 --LL:NQS USTERMIXTIN3
AND FIXI.W, TKZ METHODS OF AiSSSSMW.- IN EACH
r
DISTRICT, FIXL10 TV.Z RATS 07 ASSEZ9KVTT FOR COSTS
OF STREET MAINMANCE, P.nVIV:N* FOR NOTICE,
%
HWTKG A1.'TD CERTIFICATION.
WHEMS, the City, by Res dution, has defined the boundaries a,
eeta)>Lished Street maintenance districts ag provided by State Law, and
WE?SAS, it is necessary to deterr-tne, levy and a*seez the
properties within the districts.
NOW, THSREFOR-3 BE IT RESOLVED BY THE CITY COTIrICTI, OF THE C--7Y OF
BILLINGS, MONTANA, AS FOLLOWS;
21. M-STROO OF AMMUU, The City hereby determines that each
lot or parcel of land within both Street Maintenance Dietritts One W
and Two %2) shall be assessed for that portion of the whole cost which
each lot or parcel of land La the respective district bears to the
total area of the respective district exclusive of streets, avenues,
alleys and publiT places.
2. Luz DISTRICT ONE Clj- Each lot or par --el within
portions of the Central 3usineaa District, L%einq District One (1), is
hereby aseedzed $ a. as 1415 per square foot 0--' area.
3. M! I2'rfijR1= =Q (2) . B&=h lot or parcel within the
balance of the City, being District Two (2), is hereby assessed
S 0. 00 17 A19= - -- Per Square foot of area.
4. MAXIMUM ANNUAL -CBARQE- The maximum annual charge, for any
tract, parcel or lot which is undeveloped and unimproved shall be Five
Hundrad Dollars ($500.00).
5. LOTS "AND P�VZCSLS, ASSESSED. A11ist which describes each lot
or parcel of land assessed within the respective dirtrict, with the
name of the owner cbereof, and the amount levied thereon set opposite
is computed, conapiled and stored in the City Computer Center and is
available AS a printed document in the of f iot of the city Engineer at
the Parmly Billings- Library Building, Billings, Montana.
6. COLLECTION OF ASSESSMEMTS� Said special assessments shall
be placed upon the assessment rolls and collected in the same manner
as other taxes.
7-32-1 997 8 : 21 AM F?O` I CITY OF S I -L I NCS 406 S57 5272
Q_
��aupG S
RESOLUTION M. 96- r1144-
7. N011rg Off Kgh1AQ. Or. Monday, Saptanber 23, 1996, at 7;3C
o'clock p.m., or as soon thereafter as the miatter may he considered on
the agenda irtthe Council Chambers of the Ci=y Hall, Billinga, Montana,
the City Council will hear ob4eot4or.S to the final adoption of this
resolution.. The City Clerk is hereby directed to publish notice
thereof once, at least five (S) days prior to the hearing, 'in the
s_�inga T'imga.
8. C,=:Z-CATI(kti*. The City Clerk is hereby directed upon final
passage and approval of this resolution to certify a copy thereof to
the Finance Cirector of the 0-Jty of Siliinga, Montana, who shall
certify a copy to the Yellowstone county Clerk and a copy to the
Yellowstone County assessor.
9. BFFRCT=,-.DAT, Th=s resolution stall be effective upon
final adoption.
PASSED PROVISIONAUY by the City Council and AP".00SD
PRO7ISi4NALLY this 9th day of September. 1996.
A-VIPROVUSI i PROVIS:O.'QALLY 1
` • CITY C 9ILL1 .19
BY: �
cX7tlea F: Toaley, MAYCF
ATTEST:
SY.-
rJl
t�arlta Harold, CM^ CITY CLM
The foregoing Resolution No. 96- t~ wa8 FINALLY ADOPTED by the
City Council and APPROVED this 23rd dray o! September, 1996.
ATTEST:
••fii
CITY OF/ BILLISGS:
SEAL,,,
C ar�^ao. sy,I1•L=N
2
7-22-1997 8=224M
F?C!-I CITY Oc B I -L I NGS 406 ES7 6252 P. `t
13rw�S
RESOLUTION NO. 83-.�
A RESOLUTION OF THE CITY OF BILLINGS CREAT!NG TWO STREET
MAINTENANCE DISTRICTS '4THZN :HZ BOUNDARIES
CF THE CITY OF BrLLZNGS
WHEREAS, state lari allows creation of Street Ma,intenanca
Districts !or p-,rposas of maintaining and ixp:ovinq streets, avenues,
and alleys including but net limited to sprinkling, graveling, oiling,
chip sealing, seal coating, o`rerlaying, treating, general cleaning,
sweeping, flushing, snout re.•:u.,val, and leaf and debris removal, wi :hin
said districts, and
WHEREAS, it is in the bast interest of the City that the
City }x divided into t :o (2) districts, one including portions of
the central business dittrict and the other the halanco of the City
s1L as shown on a map aztaehad hereto and by this reference :Wade a
part hereof, Now Therefore,
BE IT, RESOLVED BY ':HE CITY COUNCIL Oa TqS CITY OF BILLINGS, NO iTANJF
AS FOLLOWS:
1. Creation, Twt (2) Street Msinttnarce District" are
hereby created pursuant to MCA 5?-12-4402 as shown on the map
attached hereto and by this rcfarencc Made a part hereof. Number
One (1) District shall be portions of the central business dis-
trict and is shown as a yellow area on the nap attached to the reso-
lution on file with the City Clerk. 2lxnwer two (2) shall be
a.esignated as the balance of the City as of the data of this
Re3o1*ation exclusive of District One (1) and exclusive cf these
properties presently beiMg assessed in Special Tmprovoment P.istricts
xos. 1129, 1131, 1133, 1143, 1144 and 1145 shown as blue areas on
the map.
2. Previous !resolutions: This Resolution supersedes
all other resolutions creating and amending sprinkling districts.
3. Effective pate. ThAt this Resolution shill be in
full force and nffact from and after its passage and approval and
u?on the Affective date of ordinance No. 83-
PASSED by the City council and APFRCL'ED'��'
1983. IV
ATTEST
1"7Z�,
Oyn
C;,ty Cl—arx
TFE CITY OF BILLINGS
Mayor
7-02-1997 3:234M
F-:CNI CITY" OF 3 I _L 1 N3!3 406 GE-7 5202
P. 5
GO
S'T METS, SIDEWALKS AND OTHER PUBLIC PLACES � 22.502
city elects to remove, after removal an additional notice shall be mailed advising the owner of
the real property of the total cost of abatement. The owner shall be ailowed an additional ten
(10) days to pay the cost; or make satisfactory arrangements to pay. Upon payment the lien
will be satisfied.
(Code 1967, § 13.18.037
Sec. 22.447. interest_
The total cost of abatement including the city ad.•ninistrative cost, shall bear interest at a
rate not less than ten (10) percent per annum from and after filing the lien until total cost of
abatement and interest are paid in full.
(Cade 1967, § 13.18.040)
Sec. 22448. Appeal to city council.
An owner who has been given notice of a vision obstruction and direction to remove may
appeal the order within ten (10) days of the date of =ailin` or posting. Upon filing notice of
appeal, abatement of the vision obstruction shall be stayed pending final termination by the
city council. The roticc of appeal shall be in writing, signed by an :ntarested party, and filed
with the city clerk. The =tice shall state any reasons purporting rove. -sal of the order on
abatement, and shall give the owner's correct :nailing address The clerk shall upon receipt
of the notice cause the matter to be placed on the council agenda a- she first council :m-
mediat*17 following receipt of notice.
(Code 1967, § 13.18.046)
.ARTICLE 22-M. STREET IMALN1'EIVA,NCE DISTRICT -
Sec. 22-601. Desig=tiou.
Whenever any portion of the city shall have beon designated as a street maintenance
district, the streets and avenues and intersections of streets and avenues in such district may
be maintained as maintenance is defined in MCA 7-12.4401(2) for sica time and in such
manner, and under the supervision of the city.
(Code 196-, § 13.20.010; Ozd. No. 834540. § V13.20.010), 8.3.83)
Sec. 22 502. By whom work may be done.
Maintenanee as referred to in section 22-501, may be done by contract, or by forces in the
employ of the city, or both.
(Code 19o"'I, § 10320.020; Ord. No. 83.4540, § 1(13.20.020), 8-8-83)
'State law reference —Special provisions for street maintenance districts, MCA 7.12-4401
et seq.
supp. No.6
1343
7-02-1 997 6 : 234M FPO`-1 CITY OF 5 I I NOS 406 657 S252
V
§ 22 503 BD LLNGS CODE
Sec. 22-503. Use of city forces.
Whenever any portion of the work with;r a maintenance district. has been done by azy
forces employed by the city, the city administrator shall certify to the council on or before the
r= Monday in October, of each year, file cost and expense tech forces used in each mtainte•
Hance district of the city, together with an estimate of the cost for the portion, of the time such
forces may bs required to be used in eat--h district for the balance of the fiscal year.
(Code 1967, § 13.20.030; Ord. No. 834540, § 1(13.20.030), U-831
Sec. 22-304. Assessment of costs.
All of the costs and expenses of each maintenance district, exclusive of the cost of
maintaining public plates and the intersections of streets with avenues or alleys, shall in all
cases ba assessed and taxed to the lots or parcels of land within the district.
(Code 1967, 1 1.3.20.040, Ord. No. 83.4540, § 1(13.20.040% 8.8-83)
Sec. 224"1. Madmum annual assessment for parcels, tracts or lots which are un-
developed and unimproved.
The maximum annual assessment for streat =sustenance for say tract, parcel or lot
which is undeveloped and unimproved shall be three hundred dollars ($300.00).
(Ord. No. 88-4761, § 1, 4-25-88)
See. 2MOS. Assessment method.
Each lot or parcel of land shall bear its share of the costs and expenses of each mxair_te•
lance dish-ict according to the options set forth in MCA Title 7, Chapter 12 (section 7-12-101
et seq.). The city council shall determine and fix the proportion to be assessed in each district
by each such method. The assessment shall be exclusive of the costs and expenses of maintain.
ins public places.
(Code 1967, $ 13.20.050; Ord. No. 83-4540, § U13.20.050), 8-5-83)
Sec. 22-W. Certification of tax.
The takes for maintenance districts assessed under sections 22-504 and 22.505 shall be
extended in the same manner as other special assessments and shall be certified to the county
clergy.
(Code 1967, § 13.20.060; Ord. No. 83.4540, ¢ U13.20.060). 8.8-33),
ARTICLE 22-6W. DISCONTYNUA-NCES AND VACATIONS
Sec. 22-601. Petidon.
Petition to discontinue and vacate any street, alley or right -of way within the city shall b.--
presented on a form approved by the city and shall bear the signatures of the abutting real
Supp. No- 6
1344
P. 6
f3'��.csCs S
TO PHONE NO. : 9140675977580531 JUL. 1.1997 10: MAM P 2
FROM City of Bozeman PHONE NO. : 406 5e2 2344
CITY Of BOZEMAN, MONTANA
STREET MAINTENANCE DISTRICT PROGRAM DESCRIPTION
Under the authority of Sec:tlon 7-12-4401, at. seq., Montana Code Annotated, the
City of Bozeman passed Commission Resolutinn No_ 2803, crsating a single street
maintenance district. This district encompasses all properties within the city limits. A public
hearing was held on July 9, 1990, to seek input from affected parties.
Assessments are made based on the area of each parr:al at the rate of $0,00416 per
square foot. This assessment rate is reviewed and set on an annual basis by the Bozeman
City Commission. Three major esso�s4rment categories are identified, based on the zonirig of
the Individual parcels:
1. Residential
2. Commercial/industrial
3. Public Lands and Institutions
.Assessments are calculated b y multiplying the area of the parcel by tho osscssment
rate. However, maximum assessments for Individual Residentially -zoned parcels for fiscal
year 1992 are as follows:
R-1 -
$ 62. 40/year
R-2 -
$46.80/year
R-3 -
$31.201year
R-4 -
$31.20/year
No maximum assessment is established for Commeecialllndustrial percels. The
assessment rate of $0.00416 per square foot for this fiscal year is applied uniformly
throughout the district.
Assessments for Public Lands, e.g., Public parks and bulldings, are assessed against
one-fourth of the total area of the parcel.
Street maintenance funds are earmarked for streets and can only be spout on
maintenance Items such as asphalt overlays, chip sealing, curb and gutter replacement,
street sweeping, snow plowing and equipment purchases.
Assessments are billed the same as the City`s speclalrmprovement districts. One-half
of the assessments are due in November and one-half are due the following May.
Property owners who fall to pay their assessments when due are assessed a 2 percent
penalty, and the unpaid assessment accrues interest at the rate of 10 percent until paid. In
addition, the unpaid assessment is placed as a lien on the property the same as delinquent
general property taxes.
ocmaw Iasi
Agenda -June 2, 1997
AGENDA ITEM * - REVIEW STORM SEWER ASSESSMENT STUDY
BACKGROUND/CONSIDERATION: As per our previous discussions
concerning Green Acres annexation and the direction of the Council,
I formed an internal committee consisting of staff members with
direct knowledge of the program. In addition to those with direct
knowledge (such as Public Works), I included two supervisors
without direct financial or public works knowledge.
The committee report is included in your packet for review. I will
not summarize the report, but will suggest that, upon review of the
ordinance, our storm sewer needs, and our revenue stream, that any
alternatives that result in a reduction of revenue will only push
us closer to an increase in the assessment levy for all users.
RECOMMENDATION: My recommendation at this time is to not make A=
changes, 14 jg existing formulas. As pointed out in the report,
the current ordinance seems to be a "fair, practical method" to
assess those benefitted properties or at least the contributors on
an equitable basis as possible. My recommendation is based upon
the philosophy of fees that require the user/contributor to pay the
share that is attributed to them (or their property), and my
responsibility to maintain viable revenue streams and budget
viability for the City services and citizens as a whole. If you
desire a change to satisfy the complaints received during the
discussion of annexation, I would suggest that the one acre maximum
be the alternative for consideration.
Agenda -June 2, 1997
No system is entirely acceptable, perfect or equitable to those who
have to pay a fee. I submit that even if there is a change
approved, we will still receive complaints about the formula.
Incorporated 1892
lephone (406) 758-7700
rAX 1406) 758-7758
Post Office Box 1997
Kalispell, Montana
Zip 59903.1997
Date: April 28, 1997
To: Clarence Krepps, City Manager
From: John Wilson, Assistant City Engineer M
Re: Storm Sewer Assessment Review
Attached please find the final report from the Storm Sewer Assessment Review
Committee. Our recommendations are the result of committee discussions and
a thorough review of storm drainage assessments for vacant parcels throughout
the City.
As we evaluated various alternatives, the Public Works Department developed
a more efficient method of analyzing the special assessment records. By
loading County data files directly onto our desktop computers, we are able to
sort information, make calculations and audit records much more quickly than
was previously possible. This new method has already helped us discover
inaccurate property records which would otherwise have resulted in lost
revenue to the City.
Douglas Rauthe
Mayor
Clarence W. Krepps
City Manager
City Council
Members:
Gary W. Nystul
Ward I
Cliff Collins
Ward I
Norbert F. Donahue
Ward II
Dale Haarr
Ward II
)im Atkinson
Ward III
Lauren Granmo
Ward III
Pamela B. Kennedy
Ward IV
M. Duane Larson
Ward IV
Storm Sewer Assessment Review
Purpose
In the course of recent annexation efforts, a few owners of large sparsely developed tracts have
objected to storm sewer assessments which they believe are too expensive for the services received.
A Storm Sewer Assessment Review Committee was appointed by the City Manager to review the
method of assessment for large vacant tracts and recommend alternatives as necessary.
Background
A storm sewer assessment ordinance was adopted by the City Council in 1976 to establish annual
fees for each lot or parcel of land within the City. These funds are placed in a separate account for
the payment of debt service, maintenance and construction costs for storm sewer facilities.
Each lot is assigned to a rate class based on its aggregate runoff coefficient. The coefficient is
determined by the surface type and slope of the property. The four rate classes range from Class 1,
which is typified by a grassy field with a low runoff coefficient, to Class 4, which represents a
paved parking lot. Most residential properties fall into Class 2. Each rate class has a corresponding
assessment factor which is multiplied by the area of a given property to determine an annual storm
drainage assessment. The assessment is billed to the Lando xmer with their property taxes.
To illustrate the current pattern of assessments, the owner of an average 7000 square foot residential
lot is charged $19.23 per year. The owner of a typical undeveloped 3 acre parcel pays $179.49 per
year, while properties such as the Cattleman's Casino on Airport Road and Wendy's Restaurant on
East Idaho pay annual assessments of $167.94 and $145.93, respectively.
Relatively few large undeveloped tracts exist within the City Limits. Only 79 of the 6103 City lots
and parcels shown on the county tax records are larger than one acre. Although these parcels may
be found in several areas of the City, concerns about high storm drainage assessments have been
expressed only recently and only from areas which are newly annexed or proposed for annexation.
One City property owner on Grandview Drive, who is currently protesting the assessment on her
sparsely developed 5 acre parcel, pays $299.26 per year. Another property owner in Greenacres,
who has expressed concerns about higher assessments if her 1.5 acre parcel is annexed, would pay
approximately $90.00 per year under the present system. In these cases, the drainage facility is a
grassy swale or ditch flowing to a nearby low area. Because such primitive facilities are easy to
overlook, the benefit to a given property and the City's expense for maintenance may be taken for
granted.
Alternatives Considered
In their discussions, the review committee identified the following alternatives for further
examination.
Status Ouo
The status quo was deemed worthy of consideration because this assessment method has worked
well for the past 20 years without a single request for adjustment. The ordinance is straight forward,
simple for property owners to understand and practical for City staff to administer. Every property
within the City has been analyzed and assigned a runoff coefficient and rate class.
Now the above referenced property owner on Grandview Drive believes she is charged too much
and the proposed Greenacres annexation has raised questions about the fairness of assessments for
larger tracts. Although these people have raised valid questions, we must accept the fact that some
small degree of inequity is inherent with any method of assessing a large number of properties. It is
because of such inequities that the current ordinance provides a method for appeal.
Reduced Rate for Large Parcels
A slight change to the current ordinance was considered, whereby a reduced charge per square foot
would be adopted for large vacant or sparsely developed parcels. A square footage cut off value
would be established to segregate typical residential size lots from larger vacant tracts. All
properties with a Class 1 runoff coefficient and larger than say 'h acre, or 21,780 square feet, would
be assessed at 50% of the Class 1 rate.
In the course of examination we realized a critical inequity, as shown in the following example. We
considered two adjacent undeveloped parcels with identical runoff characteristics. Parcel A might
have an area of 21,750 square feet while Parcel B has an area of 22,000 square feet. Under the
scheme outlined above, the owner of Parcel A would pay an annual assessment of $29.87 while the
owner of Parcel B, which is essentially the same size, would pay only $15.11.
This strategy may also be very difficult to accommodate in the County's computer program which
calculates our special assessments.
Maximum Assessment for Large Parcels
A different adjustment to the current ordinance was considered, whereby a maximum assessment
would be established for large vacant parcels. A square footage cut off value would be chosen, at
say'/2 acre, to define a maximum assessment value. All properties with a Class 1 runoffcoefficient
would be assessed by the current method with annual charges limited to that maximum value.
Reworking the example above, Parcel A would be assessed $29.87 while Parcel B, and all other
Class 1 parcels larger than '/: acre, would be assessed $29.91.
We have been advised that the County's computer programming options can accommodate this type
of assessment.
l
Recommendations
The focus of this review is the fairness of current storm drainage assessments for large vacant or
sparsely developed parcels. It is the committee's observation that the 1976 ordinance has served its
purpose well as a straight forward, practical and generally equitable means of assessing storm sewer
charges. In resolving the issue of assessments for large vacant parcels it is reasonable to make
minor modifications to the ordinance and place a ceiling on such charges.
A maximum assessment for large Class 1 parcels will serve to reduce the financial impacts of
annexation for certain owners of vacant land. This change can be incorporated into the present
assessment system with relatively little disruption. Within this method a square footage cut off
value must be designated to segregate typical residential lots from large vacant or sparsely
developed tracts. The following information illustrates the viable options for Council consideration.
The Storm Sewer Assessment Review Committee prefers the IAcre Maximum option as a realistic
representation of large tracts and to minimize the reduction of annual storm sewer revenues.
Acre Maximum
This cut off value would effect a reduction in storm drainage assessments for 151 properties. The
total revenue reduction would be approximately $15,840 from a current annual assessment of
$235,000. The maximum assessment for vacant or sparsely developed parcels would be $29.91.
% Acre Maximum
This cut off value would effect a reduction in storm drainage assessments for 109 properties. The
total revenue reduction would be approximately $13,965. The maximum assessment for vacant or
sparsely developed parcels would be $44.87.
1 Acre Maximum
This cut off value would effect a reduction in storm drainage assessments for 79 properties. The
total revenue reduction would be approximately $12,573. The maximum assessment for vacant or
sparsely developed parcels would be $59.83.
ASSESSMENT
LOT SIZE FOR VACANT
acres
�/4
'/2
3/4
1
3
5
10
PROPERTY
$14.96
$29.91
$44.87
$59.83
$179.49
$299.15
$598.30
%2 ACRE
ASSESSMENT
$14.96
$29.91
$29.91
$29.91
$29.91
$29.91
$29.91
% ACRE
ASSESSMENT
$14.96
$29.91
$44.87
$44.87
$44.87
$44.87
$44.87
ASSESSMENT
$14.96
$29.91
$44.87
$59.83
$59.83
$59.83
$59.83
The runoff coefficient and rate class will be re-evaluated as each property is developed and
assessments will increase to reflect the appropriate contribution to the storm sewer fund.
Conclusion
We submit that all properties within the community benefit from the storm drainage assessment
program. Even those owners of vacant tracts enjoy the sustainable property values and desirability
of a city with proper infrastructure. Every citizen realizes the benefit of traveling throughout the
community on well drained streets and of receiving waters which are protected by properly
constructed and maintained drainage facilities.
It would be idealistic to suppose any assessment system could be completely equitable. However,
we believe the current ordinance, with it's provision for appeals and the recommendations to
accommodate large vacant parcels, is a fair, practical method of determining storm drainage
charges.
This is not to discourage a more thorough review of the ordinance in the future. Some terminology
and procedures warrant updating, but with the busy construction season upon us, the task should be
deferred as a winter project.
Date: June 17, 1997
To: Clarence Krepps, City Manager
From: John Wilson, Assistant City Engineer
Re: Special Street Maintenance Assessments
The Storm Drainage Assessment Review Committee reconvened as the Special Street
Maintenance Assessment Review Committee on June 11 th. Those attending were Ad Clark,
Diana Harrison, Jim Hansz, Fred Zavodny and myself. We reviewed the current ordinance and
the letter which was presented to the Council by Mrs. Peters on June 2nd.
The consensus was although the present system distributes assessments uniformly on a square
footage basis, we should examine other systems to apply the same concept of uniformity on a
demand related basis. Parking requirements, as adopted in the Kalispell Zoning Ordinance, and
trip generation estimates based on accepted engineering standards were discussed as options to
quantify demand. Considerable discussion was given to a flat rate for residential properties with
a more detailed formula for commercial and business interests.
We will meet again next week to discuss these and other options which may arise. The early
alternatives are to either do nothing or completely revise the system. We will focus some
attention on the possibilities for amending the present system, similar to the maximum fees we
recommended for storm drainage assessments.
In the mean time, we will need an opinion from Glen about any statutory restrictions as to how
we can assess such fees. Can we assess fees for one purpose in two fundamentally different
ways, as with the flat residential / calculated commercial strategy mentioned above? What, if
any, limitations does State law impose on special assessments?
Another key question is whether or not the Council wants the Special Maintenance Assessment
program to be revamped for the upcoming tax year. Although we agree there is room for
improvement, a fundamental change in assessment procedures will require hundreds of man
hours. Without a dedicated City Tax Assessor, we recommend a 6 to 9 month schedule for staff
to implement a new program in the midst of other projects. If the goal is to make major changes
for the upcoming tax year, work must begin immediately and will extend through August at the
expense of other projects.
Cc: Glen Neier, City Attorney