12-20-10 PCITEM 3-1
TPC3601 Thurston Avenue N, Suite 100
Anoka, MN 55303
Phone: 763.231 .5840
Facsimile: 763.427.0520
TPO@ Plan ningCo.com
MEMORANDUM
TO: Otsego Parks and Recreation Commission
Otsego Planning Commission
FROM: Daniel Licht, AICP
DATE: 16 December 2010
RE: Otsego — Subdivision Ordinance; Park and Trail Dedication
NAC FILE: 176.08
BACKGROUND
The City Council has directed City staff to annually review the park and trail dedication
requirements in Section 21-7-18 of the Subdivision Ordinance. The purpose of this
review is to demonstrate that there is a nexus between the cash fee in lieu of land
accepted by the City for park and trail acquisition and development purposes is
representative of the costs incurred as required by Minnesota Statutes 462.358, Subd,
2c and case law from Dolan v. Tigard.
The City completed a detailed study in 2003 of park and trail development costs
including land acquisition, land preparation and construction, the relationship between
housing density and park land needs, community facility needs and fees for commercial
and industrial development. Since that initial 2003 study, the City has annually adjusted
the park and trail dedication fee paid in lieu of land dedication to account for changes in
land value or construction costs.
ANALYSIS
Current Fee. The City's current residential park and trail fee in lieu of land for
residential development was adopted to be effective for 2010. The fee is based on the
following cumulative factors stated on a per residential unit basis:
Land acquisition: $1,280.00
Neighborhood park development: $ 860.00
Community Facilities: $ 880.00
Future trails construction: $ 60.00
TOTAL $3,080.00
For 2010, park and trail dedication fees in lieu of land for commercial and industrial
subdivisions were established at $7,000.00 and $3,500.00 per gross acre, respectively,
based on 2003 land values.
Land Cost. The land values component of the City's current park and trail fee is based
on an estimated cost of approximately $32,000 per gross acre established by Wright
County Assessor for 2010. As of this date, Wright County is not proposing to adjust
their estimated land value for developable residential properties for 2011. Based on this
information, no adjustment to the land value component of the City's park and trail fee is
required:
Estimated
Required
Per Acre
Single Family
Per Unit Cash
Raw Land
10% Land
Cash
Density
Dedication in
Value Per
Dedication
Contribution
Lieu of Land
Acre
$32,000
x
10%
_
$3,200.00
/
2.5
$1,280
$20,000
x
10%
_
$2,000.00
/
2.5
$800
The current cash fee in lieu of land for commercial and industrial is reflective of land
values equal to $70,000 an acre for commercial property and $35,000 an acre for
industrial property. Land sales and appraisals done as part of the TH 101 and CSAH 42
improvement projects suggests minimum commercial property values of approximately
$350,000 per acre for commercial land and approximately $100,000 per acre for
industrial land. The City could justify an increase in the commercial and industrial cash
fee in lieu of land for park and trail dedication. However, from an economic
development standpoint, City staff recommends that the commercial and industrial cash
fees in lieu of land for park and trail dedication not be changed.
Construction Cost. The City undertook construction of three new neighborhood parks
in 2006 and a conceptual design for a park within Wildflower Meadows based on
facilities and site designs intended to define a typical neighborhood park. The adjusted
average cost for these parks in 2010 was $690,318.00 based on construction inflation
information published by the Engineering News -Record Construction Cost Index. The
ENR Construction Cost Index from 2009 to 2010 indicates a four percent increase in
construction costs, which should be reflected as an increase in the estimated
construction cost of a neighborhood park. The cost for a neighborhood park would be
estimated at $717,931.00
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Each neighborhood park guided by the Comprehensive Plan is anticipated to serve an
approximate one square mile area. Assuming an average density of 2.5 dwelling units
per acre within residential areas of the City based on existing development and
established development regulations, there are approximately 804 households per
square mile. As such, the cost per dwelling unit for neighborhood park construction
based on the current typical park facility design and construction costs is recommended
to be set at $893.00 for 2011.
Community Facilities. Funds collected for community facilities may be used to
develop a future community center building as well as acquire land and develop the two
additional community parks shown on the 2004 Comprehensive Plan Future Parks and
Trails Plan map and/or continue development of remaining facilities shown on the
Prairie Park master plan. The community facilities portion of the cash fee in lieu of land
is based upon acquisition and development of land and/or buildings for future
community facilities in relation to projected population. With the change to the cost of
construction costs for 2011, City staff recommends that the community facilities portion
of the park and trail dedication fee be increased from $880.00 to $915.00.
Trails. The trails yet to be constructed as per the 2004 Comprehensive Plan Future
Parks and Trails Plan map measure approximately 73,990 feet. The 2011 cost estimate
for the construction of trails as part of street projects or stand-alone construction is
$17.41 a linear foot and is increase by four percent to $18.11. To determine a cost
factor for future trail construction the following equation is used:
72,010ft. x $18.11/ft. / 21,079 households = $61.87 / dwelling unit
RECOMMENDATION
Our office recommends that the park and trail cash fee in lieu of land for residential
subdivisions paid on a per dwelling unit basis as set forth by Section 21-7-18.1 of the
Subdivision Ordinance be increased to the following amount:
Land acquisition: $1,280.00
Neighborhood park development: $ 893.00
Community Facilities: $ 915.00
Future trails construction: $ 62.00
TOTAL $3,150.00
The Planning Commission and City Council may also consider maintaining the current
commercial and industrial cash fees in lieu of land. This recommendation reflects
current information indicating stable land values and construction costs related to park
land acquisition and development going into 2010.
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POSSIBLE ACTIONS
A. Motion to recommend park and trail dedication fees in lieu of land for 2011 as
follows:
Residential: $3,150/du.
Commercial: $7,000/ac.
Industrial: $3,500/ac.
B. Motion to not recommend the proposed park and trail dedication fees.
C. Motion to table.
C. Mike Robertson
Tami Loff
Brad Belair
Andy MacArthur
Ron Wagner
C!