Item 3.4 Supporting infrastructure through statutory impact fee authority0tCITY o o
MINNESOTA
DEPARTMENT INFORMATION
Request for
City Council Action
ORIGINATING DEPARTMENT REQUESTOR:
MEETING DATE:
Administration City Administrator/Finance Director Flaherty
February 22, 2021
PRESENTER(s) REVIEWED BY:
ITEM #:
Consent
3.4
STRATEGIC VISION
MEETS:
THE CITY OF OTSEGO:
X
Is a strong organization that is committed to leading the community through innovative
communication.
Yes
Has proactively expanded infrastructure to responsibly provide core services.
BACKGROUND/JUSTIFICATION:
Is committed to delivery of quality emergency service responsive to community needs and
expectations in a cost-effective manner.
as well as water and sewer infrastructure; however, no authority exists for street infrastructure fees.
Is a social community with diverse housing, service options, and employment opportunities.
after the Minnesota Supreme Court's decision in Harstad v. City of Woodbury, where the court found no
Is a distinctive, connected community known for its beauty and natural surroundings.
AGENDA ITEM DETAILS
RECOMMENDATION:
City staff is recommending that the City Council adopt a Resolution supporting legislation.
ARE YOU SEEKING APPROVAL OF A CONTRACT?
IS A PUBLIC HEARING REQUIRED?
Yes
No
BACKGROUND/JUSTIFICATION:
Under current Minnesota Statute, the City has authority for establishment of development fees for parks
as well as water and sewer infrastructure; however, no authority exists for street infrastructure fees.
The League of Minnesota Cities (LMC) is currently urging city councils to adopt a resolution providing clarity
after the Minnesota Supreme Court's decision in Harstad v. City of Woodbury, where the court found no
existing statutory authority to collect fees for future infrastructure improvements when approving
residential development.
The attached resolution supports legislation that would authorize cities to collect infrastructure
development fees to fund municipal street improvements as a necessary component of growth.
The City of Otsego would be positively impacted by having the authority to charge development impact
fees for street infrastructure. Without such authority, the City will have to find new revenue sources to
fund the larger collector and arterial streets and intersections needed to support new and continued
growth of residential, commercial and industrial within the City.
SUPPORTING DOCUMENTS ATTACHED:
0 Resolution 2021-09
POSSIBLE MOTION
PLEASE WORD MOTION AS YOU WOULD LIKE IT TO APPEAR IN THE MINUTES:
Motion to adopt Resolution 2021-09 supporting infrastructure accountability through establishment of
statutory impact fee authority.
BUDGET INFORMATION
FUNDING: BUDGETED:
N/A N/A
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO: 2021-09
SUPPORTING INFRASTRUCTURE ACCOUNTABILITY
THROUGH ESTABLISHMENT OF STATUTORY IMPACT FEE AUTHORITY
WHEREAS, the population of Otsego and populations in Minnesota cities are growing statewide; and
WHEREAS, the development and construction associated with that growth are driving the need for road
improvements including street oversizing, street redesign, and street reconstruction; and
WHEREAS, municipal statutory authority appropriately exists for fees to support added need for parks,
sewer, and water; and
WHEREAS, this municipal authority does not exist for street infrastructure development fees; and
WHEREAS, city streets are one of the four major types of infrastructure local government is responsible
to provide to protect public safety and health, and city streets represent a separate but integral piece of
the network of roads supporting movement of people and goods; and
WHEREAS, existing funding mechanisms, such as Municipal State Aid (MSA), property taxes, and special
assessments have limited applications, leaving cities under -equipped to address growing needs; and
WHEREAS, neighborhood streets are constructed according to city standards by developers; and
WHEREAS, funding sources for larger collector and arterial streets and intersections to support new
developments have historically come from street infrastructure development fees; and
WHEREAS, the Minnesota Supreme Court found in Horstod v. City of Woodbury that no statutory
authority existed for these street infrastructure development fees; and
WHEREAS, cities should not be forced to make current residents and businesses pay for costs incurred
to accommodate new growth through local taxes but rather by those that are responsible for the
growth; and
WHEREAS, cities are finding it difficult to develop adequate funding systems to support needed
infrastructure development related to new growth while complying with existing state statutes; and
WHEREAS, cities need flexible policies and greater resources in order to meet growing demands for
street improvements.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF OTSEGO THAT, the City Council
supports legislation that would authorize cities to collect infrastructure development fees to fund
municipal street, collector, and arterial street improvements as a necessary component of continued
new residential, business and industrial growth within the community.
ADOPTED by the Otsego City Council this 22nd day of February, 2021.
MOTION BY:
SECONDED BY:
IN FAVOR:
OPPOSED:
2
CITY OF OTSEGO
Jessica L. Stockamp, Mayor
ATTEST:
Audra Etzel, City Clerk