Blooming Prairie residents directly impacted by a city improvement project will now face part of the financial burden for the project.
The Blooming Prairie City Council approved a new policy instituting special assessments during its meeting on Monday night.
Traditionally, the city has bonded for a project and paid for it by setting up a city-wide tax levy. The city, however, is nearing its debt limit, which means important infrastructure updates will have to be delayed until the debt is retired. Thus, city Engineer Brett Grabau and City Administrator Andrew Langholz recommended approving the special assessment policy in order to continue to stay on track with infrastructure maintenance.
Monday night’s move effectively created a formalized policy, which would allow Blooming Prairie to assess the cost of part of an improvement project to property owners who directly benefited from the improvement. For example, an improved service lane access could improve the value of the homes on that road, thus the residents on that particular road would pay a higher amount than a property owner located elsewhere in the city.
Some of the assessment policy rates include:
Assessment of 35% of the street reconstruction project costs to property owner.
Assessment of 80% of the water service reconstruction goes to property owner.
Assessment of 80% of the sanitary service reconstruction to property owner.
City pays for 100% of trunk water main cost.
City pays for 100% of trunk sewer main cost.
City pays for 100% of storm sewer cost.
City pays for 50% of sidewalk cost.
Grabau advised the council to go with 35% on street reconstruction projects while many cities have it set at 40% because those cities are now considering reducing that percent.
Grabau discussed the topic with the city council during a work session in March. They went through a couple of different policies at that meeting, discussing different ways the city could assess those improvements. Grabau said he and Langholz drafted the policy.
“Now when it comes to actually levying with assessments, this policy does not restrict you guys, so you guys can deviate from it, although there is a policy for a reason, we try to stick to it,” Grabau said.
Grabau said that Blooming Prairie is his only client in 20 years that hasn’t had an assessment policy.
The special assessment policy was approved by the board and the city’s accountant, Abdo, Eick and Meyers, will incorporate it into the city’s debt management plan and utility rate study, according to a memo to the council.