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10-13-16 CM Agenda Packet AGENDA Council/Manager Meeting Golden Valley City Hall 7800 Golden Valley Road Council Conference Room Thursday, October 13, 2016 6:30 pm or immediately following the HRA Meeting Pages 1. Proposed Revisions to Public Expenditure Policy(25 minutes) 2-6 2. Teen Committee (30 minutes) 7 3. Government Affairs Priorities: g_2g a. Fiscal Disparities (20 minutes) b. Infrastructure (10 minutes) Council/Manager meetings have an informal, discussion-style format and are designed for the Council to obtain background information, consider policy alternatives, and provide general directions to staff. No formal actions are taken at these meetings. The public is invited to attend Council/Manager meetings and listen to the discussion; public participation is allowed by invitation of the City Council. � This tlocumen#is available in alternate formats upon a 72-hour request. Please call 763-593-8006{TTY: 763-593-3968)to make a request. Examples of alternate formats may inclutle large print, electronic, Braille, audiocassette,etc. city o�f r�� a��en � � � +� �t �► � � � � . . ��. �� CityAdministration/Council 763-593-3989 J 763-593-8109(fax) .r.. , �xt �_.� - �3�.��, r . . �.n, . � Executive Summary Golden Valiey Council/Manager Meeting October 13, 2016 Agenda Item 1. Consider Revisions to the City's Public Purpose Expenditure Policy Prepared By Chantell Knauss, Assistant City Manager Summary The City's Public Purpose Expenditure Policy was originally put into effect on January 1, 2006. State law requires public entities have a policy that identifies items such as employee recognition programs and awards,travel, meals, etc. that public funds are authorized to be spent. With the lack of availability of some of the service award items and changes in some of the programs, staff wanted to take this opportunity to review this policy and provide suggestions for revisions. Attachments • Public Purpose Expenditure Policy with recommended revisions (4 pages) CITY OF GOLDEN VALLEY PUBLIC PURPOSE EXPENDITURE POLICY Policy The City of Golden Valley requires that all expenditures be valid based upon the public purpose for which it is purchased and the specific or implied authority for the expenditure found in Minnesota State Statutes and as authorized as part of the City of Golden Valley's annual budget. � EmployeeWe�ee� Recognition Program The Golden Valley City Council recognizes the hard work and service performed by the employees � of the City of Golden Valley through a #er�a�-recognition program. The City Council believes the benefits of attracting, retaining and motivating employees through an � EmployeeA�el�tee� Recognition Program supports employee job satisfaction, which in turn impacts cooperation and productivity. The result is to provide excellent public and customer service to better serve the interests of the citizens of the community. I The EmployeeA,�elt�ee� Recognition Program is considered "additional compensation" for work performed by employees �and is entirely dependent on receiving funding from year-to-year. No provisions of this policy, or its administration, shall be subject to review under the grievance or I arbitration provisions of any collective bargaining agreement and/or the Citv of Golden Vallev Employee Handbook. The Program will include: � 1. New employees will receive a se##ee-��--ar��--�City of Golden Valley pin. 2. Employees reaching 5, 10, 15, 20, 25, 30, 35 & 40 years of service will receive a certificate thanking them for their dedicated years of service to the Community. In addition to the certificate the employee shall receive the following: � 5 years of service: $ 25 service award 10 years of service: $ 50 service award 15 years of service: $ 75 service award 20 years of service: $100 service award 25 years of service: $200 service award 30 years of service: $300 service award 35 years of service: $400 service award 40 years of service: $500 service award Employee service awards will be given only after the employee's anniversary date has passed. In accordance with IRS regulations, service awards are considered compensation � and ' must be reported as income on a�-the employee's W-2. 3. Annually, the City will sponsor#�avaEmployee Appreciation events e�er�-yea�-at which employees reaching the above �ve�l�service anniversarv milestones will be recognized. The City Manager and Department Heads �+�-may also recognize City, departmental and individual accomplishments at these events. Members of the City Council will be invited to attend. 4. The City supports other events that are planned and paid for by employees. Examples of � such events include outings such as employee golf and bowling events . I PUBLIC PURPOSE EXPENDITURE POLICY �Fa/299610/13/20126(DRAFT) Page 1 The cost of the ��^��^+� ^f+"� Employee Recognition Program will be included as a separate line item in the City of Golden Valley City Manager Department Budget. This line-item will be a�e�re� adopted annually by the City Council as �part of the overall budget approval process which includes a public hearing on the proposed budget. Employee Committee A committee representing a�-various City departments �#a��may be formed to plan the Employee Appreciation Events. Representatives may be appointed bv the Citv Manaqer or Department Head and shall serve one year terms,a Ta ��^��6;�;^��sT. Permanent committee members will include the ^�c�,�^�Finance Director and ##�Human Resources-Ge�e�. The committee may also plan additional employee-paid events at their discretion. Resiqnations , � The City v�+4{-mav sponsor salce-a�d-refreshments (up to $50)for employees who have completed probation and resign in good standing. Retirements Employees who are eligible to: I A) Receive a retirement annuity from a Minnesota Public Pension Plan, other than a ue�ee� Paid, On-call #Firefighter plan; or I B) Receive a disability benefit from a Minnesota Public Pension Plan, other than a �ee�Paid, On-call, #Firefighter plan; or , , Emplovees havinq met criteria A or B, above, are eligible to receive the following retirement check amounts: • 10 - 14 years of service - $300:s8 and an award of the emplovee's selection from Citv provided options, up to a value of$50 • 15 - 20 years of service - $400�8 and an award of the emplovee's selection from Citv provided options, up to a value of$100 • 21+ years of service - $500�&and an award of the emplovee's selection from Citv provided options, up to a value of$150 Employee retirement check amounts will be qiven onlv after the emplovee's retirement from the Citv. In accordance with IRS requlations, retirement check amounts are considered compensation and must be reported as income on the emplovee's W-2. All employees that have met either criteria A or B, above, will receive a personalized Citv of Golden Vallev street siqn. I In or��ifi�r� omnlr�voov�:�:v i�iiiv ��r#ho .+F��vo I'c4 rl nri+ori 'll . � �M��)�� I PUBLIC PURPOSE EXPENDITURE POLICY �a/�99610/13/20126(DRAFT) Page 2 +�ssr+��ieR-� +wssr�ier�} � The City av+ll-may sponsor sal�e-ar�refreshments (up to $a-89125)for retiring employees. Any additional retirement food or activities will be employee-paid. Meeting Food/Meals The City Council recognizes that situations in which City business needs to be discussed can and � do occur during meal hours (i.e. luncheon or dinner meetings). In addition, there are public and employee meetings and events in which reasonable refreshments may add to the success of the meeting and/or event and create a more productive work force. The following items are deemed to meet the Council definition of public purpose expenditures in regards to food and meals. • Food and refreshments are allowed at City meetings and events that have a purpose of � discussing City ��business. These meetings would normally have a pre-planned agenda. • Food and refreshments are allowed at employee meetings and events that have a purpose � of discussing City �c,�Tbusiness or are a part of an employee training. These meetings would also normally have a pre-planned agenda. This does not include routine staff I meetings and reqular traininq activities held at the employee's reqular worksite and which provide time for the employee to take their reqular breaks. • Foods and refreshments are allowed when they are part of a breakfast/lunch/dinner meeting for official sCity business when it is the only practical time to meet. Usually these meals involve official meetings with the City Council�s, Council committees, Boards/Committees/Commissions m�-��, taskforces, or local business/fraternal organizations. • , , • Authorized �travel expenses for employees are outlined in the City of Golden Valley Employee Handbook. Meals that are included as part of the reqistration cost for anv workshop/traininq/seminar/conference will not be reimbursed. The cost of travel expenses is included in the departments' travel/conferences line-item in the Citv of Golden Vallev Budqet. No purchase or reimbursement of alcoholic beverages is allowed. Membership and Dues The City Council has determined that the City will fund memberships and dues in professional organizations and City social and community organizations when the purpose is to promote, I PUBLIC PURPOSE EXPENDITURE POLICY �l�/�99610/13/20126(DRAFT) Page 3 � advertise, improve or develop the City's resources and advantages and not for personal interest or gain. The cost of inemberships/dues is included in the departments' memberships/dues line-item in the City of Golden Valley Budget. These line-items are approved annually by the City Council as a part � of the overall budget approval process which includes a public hearing on the proposed budget. Recognition of Commissioners � Individuals who leave after multiple terms of service as a member of a standinq commission, board or committee shall receive: 5 - 8 years of service - small inscribed award 9 - 17 years of service - medium inscribed award 18 + years of service - . larqe inscribed award The �award will be distributed at the Board/Commission Recognition Dinner. However, under special circumstances, the service anniversarv milestones may be noted at a Council Meeting or a board/commission meetinq. I Annually, the City will sponsor a Board/Commission Recognition Dinner-�-P�e�at which commission, board and e�-committee members and one_quest per member+"��r�^^�� ,•,�� h� are invited to attend. Also, members of task forces or other special boards may be invited to attend the � Board/Commission Recognition Dinner, alonq with their one quest per member. Recognition of Council Members Individuals who leave after serving as a Council Member shall receive a large enqraved award . Council Members will also receive a personalized Citv of Golden Vallev street siqn. � Upon completion of service as Mayor and/or Housing and Redevelopment Chair, the City will provide an inscribed gavel plaque. � The City will sponsor sake-�-refreshments for the Mayor and/or Council Members at the swearing in/first seating of the Council and as these members leave office. The City may also sponsor additional food for Council Members and/or the Mayor, under special circumstances as authorized by the City Manager. All items within this Policv are line-items subiect to approval annually bv the Citv Council as part of the overall budqet adoption process which includes a public hearinq on the proposed budqet 'The terms Citv Council Members, Council Members, and Council applies to the Mavor and Council Members collectivelv. I PUBLIC PURPOSE EXPENDITURE POLICY �/-1�89610/13/20126(DRAFT) Page 4 ��' C3� � � �� ,� �,��i�y ,� �� ti� � ,. �� y�;rr City Administratian/Cauncil 763 593 3989/763 593-8109(fax) Executive Summary Golden Valley Council/Manager Meeting October 13, 2016 Agenda Item 2. Teen Committee Prepared By Rick Birno, Parks & Recreation Director Summary Discussion with the City Council on the future direction of the Teen Committee. eity of t1lC��YI �VIEMO � AND M � � �+C�, �� CityAdministration/Council 763-593-8003/763-593-8109(fax) Executive Summary Golden Valley Council/Manager Meeting October 13, 2016 Agenda Item 3. Government Affairs Priorities Prepared By Timothy Cruikshank, City Manager Summary Annually the Council and Staff review the Government Affairs Priorities. Attached is the 2016 Government Affairs Priorities. Attachments • 2016 Government Affairs Priorities (13 pages) 'gg�g i�,i i . . . . �.m�B� &� �� j��'�' ��, �� • * � �cic3pt�c��iy the City Cc�ur�ci3 78(}0`olclen Valley�?o�d,Golclen Vailey,MIV S:s�627 763-5�3-80(76 !an 5,2d16 Ta 1e � on�ents , , . � , 1.Medicine Lake Rd/Winnetka Ave Regional Flood Mitigation........3 2. Public Safety Improvements At DouglasDrive/Hwy 55 Intersection .................................................4 3. Brookview Community Center Capital Improvement Funds .........5 4. METRO Blue Line Extension Funds.................................................6 5. Metropolitan Council Inflow/Infiltration Grants— PublicAnd Private Improvements.....................................................7 � . � • . : . � � � . ' . • � 6. Oppose Levy Limits............................................................................8 7. Inclusion Of Motor Vehicles For City Sales Tax Exemption............8 8. Improve Local Government Public Information NotificationProcedures......................................................................9 9. Emerald Ash Borer Disaster Assistance ............................................ 10 10. Support Early Voting Initiatives....................................................... 10 11. Support Tax Incentives For Community Reinvestment ................ 11 12. Update Fiscal Disparities Formula .................................................. 11 13.Af�ordable Housing And Workforce Housing*............................... 12 *Newl added Cit initiative � � 1 • � 14. Establish A Sustainable Fundin Formula For Increased Transportation And �ransit Funding* ........................... 13 15. Highway 169 Improvement Planning From I-394 To Medicine Lake Rd*.................................................. 13 �� City of GaNden Valiey 2�16 Caovernrnent Affairs F'riarities l. edicir�e a e Rd/Win etka Ave e��ona� Iood Miti atio Issue The Medicine Lake Rd (County Road 70)/Winnetka Ave(County Road 156)area receives storm water runoff from a one-square-mile watershed that includes portions of Crystal, New Hope,and Golden Valley.Since this area was developed in the 1970s, it has experienced flooding issues that affect more than 37 properties and several local and regional roadways.The three cities are study- ing potential measures to minimize flood-related property damage around the nearby DeCola Ponds and along Medicine Lake Rd near Rhode Island Ave. Flooding on Medicine Lake Rd,which carries an average of 10,000 vehicles per day and where sev- eral businesses have been damaged by floods,can reach depths exceeding 4 feet,making travel and emergency response difficult or impossible.During multiple flood events beginning in 1978, water depths up to 6 feet caused extensive property damage. A solution is to provide additional flood storage at DeCola Ponds and develop new ponds or be- low-ground storage throughout the watershed to slow the flow of water to the flood prone areas, thus reducing flood levels. Under this scenario the 1 percent flood would result in approximately 18 inches of water on Medicine Lake Rd and some properties would still be subject to flooding,so flood proofing may still need to be considered to minimize flood damage. It will cost an estimated $27.5 million to correct these problems. Funding from the State in 2016 would allow the three cities to coordinate to minimize flooding to the extent possible, keep Medi- cine Lake Rd passable for emergency vehicles, reduce and minimize flood damage to homes and businesses, and allow for redevelopment in the area. City Position The City of Golden Valley is requesting legislative approval of funds to implement flood damage reduction efForts within the DeCola Ponds and Medicine Lake Road watershed.These projects would include improvements within the Cities of Crystal, New Hope and Golden Valley and would include flood storage,subwatershed diversion,and runoff rate control projects. Additional Documents (See Appendix 1� • Map: Decola Ponds Flood Mitigation Area (1 page) . � . � . � . � � � 78a�Golcl�n Vailey�oaci,Galden Valley,MN 55�127 763�593.8C06 Pclt��3 2. ublic Safety Im rovements At auglas Drive/ I-�i�hwa 5 5 Issue In 2016,the City of Golden Valley and Hennepin County will reconstruct about 1.75 miles of Douglas Drive north of Highway 55, including numerous pedestrian-friendly facilities(on-street bike lanes,off-street trails,off-street sidewalks)at a cost of$23 million.Major problems will still exist at the Highway 55/Douglas Drive intersection because no funding is available to correct them. Problem:Pedestrians must cross seven lanes of Highway 55 traffic to reach businesses,schools, and other area amenities.Also,the Luce line regional trail just north of Highway 55 brings many recreational bikers,joggers,to the area. Solution:A new underpass culvert crossing for pedestrians/bikes would be ADA compliant and would connect the south frontage road to Douglas Drive (at location of new metro transit drop-off site),enabling safe passage for walkers and bikers. Problem:The south frontage road is too close to Highway 55,and vehicles don't have room to queue at intersection.Significant back-ups occur,and it can take numerous signal cycles to get through. Solution:Extending the throat of the intersection will provide more queuing capacity for vehicles at the intersection,thus moving more vehicles through in a shorter amount of time.A roundabout will eliminate the stop conditions at south frontage road and allow the intersection to quickly dissipate the queue. It will cost an estimated $6 million to correct these problems. Funding from the State in 2016 would allow the City and County to coordinate the intersection project with the Douglas Drive project at significantly lower cost and less disruption to the driving public. City Position The City of Golden Valley seeks funding to improve operations,safety,and mobility at the inter- section of Highway 55 and Douglas Drive. Future improvements would better accommodate vehicles,pedestrians,transit,etc. Additional Documents (See Appendix 2) • Funding Map: Douglas Drive/Hwy 55 Intersection (1 page) • Current Map:Hwy 55&Douglas Drive(1 page) - • - � - � - • • ��C��^,� City af Golclen Vall�y Z016 Cavernment Affairs Prioritaes . Brookview Com�rnunity Center �apital Improvement Fun s Issue Golden Valley's Brookview Community Center has served the community and residents from the metro area for almost 50 years.The building was initially constructed in 1918 as a private facility and purchased by the City in 1967.After a number of additions and remodeling projects, it has deteriorated to the point that it needs to be completely replaced.The City would like to continue to provide gathering places, meeting rooms,and large event space for community groups and organizations. Despite additions and remodeling over the years, Brookview no longer meets the needs (includ- ing modern accessibility standards)of today's population,and the yearly maintenance on the aging structure is no longer an appropriate investment. A new,accessible facility would meet's today's needs for local and regional recreation. Proposed amenities include a large meeting and banquet space,multi-use community rooms,senior area with program rooms,kids indoor play area,golf operations,and parks and recreation operations.. It will cost an estimated $18.2 million to build the new community center as proposed City Position The City of Golden Valley supports procuring funding assistance through federal,state,and coun- ty sources to help the City with the replacement of the outdated and deteriorating Brookview Community Center. Additional Documents (See Appendix 3) • Architectural Rendering: Brookview Community Center(1 page) • Building Plans: Brookview Community Center(1 page) • Project Timeline: Brookview Community Center(1 page) • Project Budget Recap:Brookview Community Center(1 page) . � . � . � . � 78C�0 Gc�lden Vali�y Roaci,C�olden Val}ey,MN 5S*�27 763-593-8006 �� 5 4. ETRC� B�ue Line xtension Funds Issue In December 2015,the Metropolitan Council approved the revised scope and cost estimate for the METRO Blue Line Extension (Bottineau) Light Rail Transit Project.The Bottineau LRT is planned to enter Golden Valley along the Burlington Northern Santa Fe(BNSF) Railroad Corridor in the south and travel adjacent to parkland,residential,and institutional areas on the east side of Golden Valley.The City anticipates granting Municipal Consent for the project�arly in 2016. The Station Area Planning process for two station locations in Golden Valley was completed in 2015. Environmental and engineering issues surrounding the proposed stations, located at the LRT's intersection with Plymouth Ave and Golden Valley Rd, must continue to be identified in the next phase of work. The Hennepin County Regional Railroad Authority, in collaboration with the Metropolitan Council and the Cities of Golden Valley,Minneapolis,Robbinsdale,Crystal,and Brooklyn Park,continue to work toward identifying and mitigating issues surrounding the eventual construction and implementation of the METRO Blue Line Extension LRT.Additional funding for future study and community outreach efforts is necessary to ensure that the project moves forward. The METRO Blue Line Extension LRT is part of a broader plan to expand mass transit options in the Minneapolis/St Paul metropolitan area.As the region continues to grow,investment in an enhanced transportation network is essential.There are many additional regional transitways currently under study or development in the region.Increased funding for the development of light rail transit and bus rapid transit is essential for the growth and well-being of the Minneapolis/ St Paul metropolitan area. City Position The City of Golden Valley urges support of light rail transit and bus rapid transit options,and seeks funding to enhance study and community outreach efforts for issues surrounding the development of the Bottineau LRT. Pa��i Citp o#GoCden Valley 2E116 Government AfFairs Priorities 5. etrapalitan Council In ow/ �filtration �rants Public d Private Improve ent� Issue The Metropolitan Council Environmental Service's (MCES)Water Resources Management Plan es- tablished an inflow and infiltration (I/I) surcharge in 2007 on cities determined by MCES to be con- tributing unacceptable amounts of clear water to the MCES wastewater treatment system.Since the inception of the surcharge program,50 cities have been identified as excessive I/I contribu- tors.This number is subject to change,depending on rain events,and any city in the metropolitan area could be affected. The City of Golden Valley is a leader in the metropolitan area in addressing inflow and infiltration from public and private sources.The City has made significant investment to address I/I issues in the municipal system. In addition,through the City's Inflow and Infiltration Ordinance,significant investment has been made by property owners to reduce I/I from private sewer services. City Position Because I/I reduction efforts benefit the entire metropolitan area,the City of Golden Valley sup- ports the state providing continued capital assistance for grants to cities as well as financial assis- tance through future Clean Water Legacy Act appropriations. Additional Documents (See Appendix 5) • Memo:MCES I&I Grant Benefits-City of Golden Valley(1 page) 78t3��;�,Iclen Vaiiey Road,Golden Valley,MRf 55�t27 763-593-$006 ��(�`� � . ' � ' . � � � • ' � � ' ' . • ' � . � � . � � • . � . • . C�ppose Levy �..,i its Issue Levy limits undermine local budgeting processes, planned growth,and the relationship between locally elected officials and their residents by allowing the state to decide the appropriate level of local taxation and services,despite varying local conditions and circumstances. For example,while working on its Capital Improvement Program (CIP),the City of Golden Valley reviews many revenue sources for financing future needs of the City. Levy limits make it impos- sible for the City to plan accurately for renewal of its infrastructure without compromising its bond rating. City Position The City of Golden Valley and Metro Cities strongly oppose levy limits. 7. Inclusio C�f.�r�otor �1"ehicles For ales :x �xemption Issue The City of Golden Valley is exempt from sales tax for most purchases except for business pur- poses(for example, Brookview Golf Course).The City is not exempt for motor vehicle purchases, because the sales tax exemption did not include the motor vehicle tax of 6.5 percent.Although police(marked)and fire vehicles are tax exempt,dump trucks that are used for snowplowing and road repair are not. City Position The City believes all City vehicles are necessary to respond to the needs of the City and supports including motor vehicles in the sales tax exemption. ��2 � City of Galden Vatiey '2E�16 Covernment Affairs Priorities 8. I prave Local Gov��rnment I'ublic Information Notificat�on Procedures Issue To keep the public updated and informed,state law requires local units of government to publish various official notifications and documents in newspapers and often dictates which newspapers receive cities'publication business.The number and variety of documents cities are required to publish,as well as the costs of publication,are burdensome. The media and newspaper industry continues to experience significant changes and declining subscriptions.At the same time technological advancements have expanded options cities can use to provide information to citizens,and citizens are demanding and expecting it.These new technologies are often more efficient,widely and easily accessible,and cost effective.Current state law regarding public access to city codes of ordinances should also address these changes for how citizens,the private sector,and other entities will have access to alternatives to existing news publications to obtain official government notices,documents,and information. City Position The City of Golden Valley believes the Legislature should eliminate outdated or unnecessary publi- cation requirements and that cities should be authorized to: • take advantage of new technologies to increase the dissemination of information to citizens and potentially lower the associated costs • designate an appropriate daily/weekly publication • use alternative means of communication,such as city newsletters,cable television,video streaming,e-mail, blogs,and city web sites • expand the use of summaries where information is technical or lengthy • publish and provide public access to local codes of ordinances on a website and to post revi- sions and changes to city codes, resolutions,and rules on the city website,when feasible 78(�0 Gcriden Vall�y Roaci,Golden Valley,MIV 55427 763-593 8t706 ��9 9, merald A�h Borer :Disaster Assist�nce Issue The Emerald Ash Borer(EAB) is a destructive beetle that has killed tens of millions of ash trees throughout the Midwest.The beetle was first discovered in the Minneapolis area in 2009 and has currently been identified within two miles of the Golden Valley border. The City of Golden Valley proactively developed an EAB Management Plan in 2010 and updated it in 2012 to include a complete public tree inventory.The inventory identified that more than 24 percent of Golden Valley's public property trees are ash.There are a total of more than 2,000 pub- lic ash trees and countless private ash trees throughout the community. The City of Golden Valley is very concerned about the total number and concentration of public and private shade trees that are in jeopardy from this destructive beetle.Currently,there is mini- mal funding and resources available to mitigate for the inevitable tree impacts on public and private property. City Position The City of Golden Valley supports procuring funding through federal,state,and county sources to help the City and private property owners with removal of infested trees and reforestation activities. Additional Documents (See Appendu�9) • Map:City of Golden Valley Public Tree Inventory(1 page) 1 t�. �uppo�°t Early Va�ti Initiatives Issue Golden Valley has had a high number of voters show up to the polls every year.With no-excuse voting this year,many people came in to vote early or applied online for an absentee ballot to be sent.Although the City is happy it is more convenient for the voter,the costs are more expensive due to postage,supplies for the absentees,and additional staff hours for both regular employees and election judges for the absentee board. City Position True early voting would allow the voter to actually vote and Cities would not incur the costs of ad- ditional supplies and postage. �� ,�� City af Galden llalley 2015 Government Affairs Priorit��s 1 l. Support Tax Incentives For �ommunity R.ein�estment Issue Golden Valley has aging residential and commercial structures that are in need of repair and reinvestment.Reinvestment prevents neighborhoods from falling into disrepair,revitalizes com- munity,and protects the tax base. Historically,the state has funded programs to promote reinvestment in communities,including the"This Old House"program (which allowed owners of older homestead property to defer an increase in their tax capacity resulting from repairs or improvements to the home)and "This Old Shop"(for owners of older commercial/Industrial property who make improvements that increase the property's market value). City Position Golden Valley supports state programs and incentives for reinvestment in older residential and commercial/industrial buildings,such as,but not limited to,tax credits and/or property tax defer- rals. 1�. �C7pdate Fz�ca1 Disparities Forrnula Issue Since enacted in 1971 and implemented in 1975, Fiscal Disparities has required cities to share a portion of their commercial and industrial tax base growth with other jurisdictions.The contribu- tion amount is based on the relative fiscal capacity of each community,which is measured by the market value per capita. Because Golden Valley has a high fiscal capacity,it contributes more to the pool than it receives.In 2016,Golden Valley will contribute$4,263,121 in net tax capacity. In recent years, more commercial and industrial parcels have petitioned for market value changes. It may take a number of years to settle a petition,and the ruling can allow valuations to be revised for the contested year as well as up to two years prior. For example,for taxes payable 2016,the 2014 taxable market values for commercial and industrial properties were used to establish Golden Valley's contribution to the fiscal disparities formula.In 2015,Golden Valley had many parcels petition to lower their valuations and the adjustments are lagging. City Position The City of Golden Valley supports a revision to fiscal disparities that accounts for adjustments due to correction of market values. 78d0 Golc3en Valley i�oac9,Golden Vall€:y,MN 5��t27 763 593 �C706 Pc�� 1 � 13. ordable �-Iousir�g r� orkfar�e ousing* Issue Cities are concerned about meeting the demand for affordable housing,including the needs of aging citizens who want to stay in their communities and workers who want to live in the com- munities in which they work.As a result of currently low rental vacancy rates,many families and individuals may be unable to use Section 8 housing choice vouchers and thus unable to secure safe,decent,and affordable housing. City Position The City of Golden Valley supports additional tools for local communities to develop affordable and workforce housing. �y�{�f' 1� City a#Gtsldert Valley 201C Cavernr�nent Affairs Priori�'ses ' � � � ' � . ' 14. Esta Iish A Sustai�able un i � Far 1a For I creas d Transporta�tion And ransit Fundin� Issue A weli-coordinated state transportation policy using all modes of transportation in moving passen- gers and freight will enhance the state economic development of new and expanding business as well as foster additional tourism opportunities. City Position The City of Golden Valley supports dedicating more resources to all components of the state's transportation system and ensuring local units of government have access to resources and fund- ing tools to meet growing needs. 15. S �Cighway 1 d9 Impraverne� Pla�.ning F�o I-394 Ta Medicine Lake Rd Issue The 20-Year Minnesota State Highway Investment Plan indicates that no capacity improvements are planned for the US Highway 169 corridor between I-394 and I-94.Travelers experience from under one hour to up to four hours of congestion daily. Furthermore,since 2002 there have been more than 1,100 vehicle crashes along the corridor,in which 25 percent resulted in injury and one crash resulted in a death.The corridor provides access to many businesses, including General Mills, the Target Corporation,CS McCrossan,St Jude Medical,Select Comfort,Caterpillar,and US Foods, to name a few. In addition,institutions such as the Hennepin Technical College,the Robbinsdale School District,and others use the corridor as a primary access. Improvements to US Highway 169 have occurred north of I-94.Additional improvements have been completed at the I-494 interchange to the south.Since early 2013,City officials have been meeting with MnDOT staff to define needed transportation improvements along the US Highway 169 corridor and to identify potential funding sources. City Position The City of Golden Valley supports funding for the Hwy 169 Improvement Planning to achieve ca- pacity and safety improvements on Hwy 169 from south of I-394 to north of Medicine Lake Rd. *Newly added City initiatives 78f3�Golr�en UaHey RQad,Gc�lden Valley,MN 55�27 763-593.80076 ��C�� .�� GZ�� Of ;�;"'�'' � �� . �� Administrative Services Department 763-593-8013/763-593-3969(fax) � w��° . � .: �, � � x.��;. Executive Summary For Action Golden Valley Council/Manager Meeting October 13, 2016 Agenda Item 3. a. Fiscal Disparities Prepared By Sue Virnig, Finance Director Summary The Minnesota Fiscal Disparities Program was set up to achieve six goals: � Sharing resources produced by growth of the metro area. � Making orderly development more likely by reducing competition for tax base. � Working within the existing power of local government and local decision making. � Giving incentives for all to work for growth of the seven county-county metro area as a whole. � Helping communities in different stages of development and redevelopment. � Encouraging environmental protection. In order to meet these goals, each taxing jurisdiction annually contributes 40 percent of the growth in its Commercial/Industrial (C/I)tax base since the year 1971 for an "area-wide tax base". Each municipality receives a share of the area-wide tax base through a formula based on its share of the area's population and its relative property tax wealth (tax base per capita). The City of Golden Valley does understand the program but feels its impact on their taxpayers. While the program uses 40%of the growth of commercial and industrial value since 1971, we believe it does not promote the revitalization of the communities that have high commercial- industrial values with lower population that creates a significant burden on the residential properties. Metro Council's report (attachment) of the disparities program for taxes payable in 2015 showed 101 recipients and 78 net contributors. St. Paul received the highest distribution with a net change per capita of$88. Bloomington is the highest net loser with a net change per capita of ($139). Golden Valley is ninth as a net loser with a net change per capital of($213). Staff is aware of the study in 2012 by TischlerBise. Their study states the program is working for most of the seven county area. The City of Golden Valley would recommend the following change to the program: � The program uses 40%of the new commercial/industrial property value since 1971. This percentage should be lowered to 30%so the inner city metro areas can use the additional amount of property taxes received to help fund infrastructure improvements that are needed especially around the commercial/industrial areas. Most inner cities that are net losers have infrastructure that was built before the early sixties that needs to be replaced. Other option reviewed by staff: � Change base year to reflect today's market or at least somewhat closer to today's market. A value used from 1971 is more than 45 years old. Also,the tax classification rate changed for commercial/industrial from 4%to 2%of tax capacity in 2001. If Council choses the staff recommendation,the legislative priority would be written using the same format as the past priorities. Attachments • Twin Cities Fiscal Disparities Top 20 Net Recipients and Top 20 Net Contributors For Taxes Payable 2015 - Metropolitan Council (2 pages) • Fiscal Disparities in Twin Cities: Key Findings for Taxes Payable in 2015 - Metropolitan Council (1 page) • League of Minnesota Cities Fiscal Disparities 101 (3 pages) � , Twin Cities Fiscal Disparities Top 20 Net Recipients Taxes Payable 2015 Community Contribution Distribution Net Change Net Change Net Change Rank Tax Base Tax Base Tax Base Per Per Capita Net Household Chg. St. Paul 24,568,732 50,525,266 25,956,534 228 88 1 Brooklyn Park 7,803,663 13,113,543 5,309,880 198 68 2 Coon Rapids 6,120,331 10,806,149 4,685,818 196 75 3 Brooklyn Center 2,690,138 6,833,738 4,143,600 381 136 4 Columbia Heights 569,573 4,339,040 3,769,467 468 191 5 Andover 998,391 4,257,801 3,259,410 320 103 6 Crystal 1,088,083 4,197,619 3,109,536 336 137 7 Cottage Grove 2,016,931 4,915,251 2,898,320 242 82 S South St. Paul 1,101,712 3,680,481 2,578,769 309 126 9 Farmington 1,002,736 3,397,197 2,394,461 321 109 10 Robbinsdale 527,282 2,774,658 2,247,376 366 156 11 Champlin 1,218,486 3,390,214 2,171,728 258 92 12 Hastings(combined) 1,526,218 3,629,720 2,103,502 237 93 13 Apple Valley 4,169,064 6,104,802 1,935,738 100 38 14 Richfield 3,696,993 5,429,508 1,732,515 114 48 15 North St. Paul 571,922 2,267,716 1,695,794 362 142 16 Lino Lakes 1,072,911 2,639,444 1,566,533 245 75 17 Blaine (combined) 6,864,208 8,330,846 1,466,638 66 24 18 Ramsey 1,984,235 3,407,504 1,423,269 170 59 19 East Bethel 342,523 1,719,767 1,377,244 340 119 20 Notes: Hastings in Washington County combined with Hastings in Dakota County. Blaine in Ramsey County combined with Blaine in Anoka County. Sources: Minnesota Department of Revenue, Property Tax Division. Population and household estimates as of April 1, 2013,from Metropolitan Council. Metropolitan Council January 2016 . , Twin Cities Fiscal Disparities Top 20 Net Contributors Taxes Payable 2015 Community Contribution Distribution Net Change Net Change Net Change Rank Tax Base Tax Base Tax Base Per Per Capita Net Household Chg. Bloomington 20,041,426 8,085,022 -11,956,404 -322 -139 1 Eden Prairie 15,719,259 4,671,423 -11,047,836 -452 -176 2 Minnetonka 13,140,436 3,422,577 -9,717,859 -434 -191 3 Plymouth 14,122,052 6,023,563 -8,098,489 -273 -111 4 Edina 9,626,075 2,540,472 -7,085,603 -332 -144 5 Eagan 12,393,062 6,829,638 -5,563,424 -215 -84 6 Roseville 8,823,807 3,401,187 -5,422,620 -361 -157 7 Maple Grove 10,852,529 5,766,878 -5,085,651 -214 -80 8 Golden Valley 5,994,022 1,597,631 -4,396,391 -491 -213 9 St. Louis Park 8,425,994 4,546,516 -3,879,478 -171 -82 10 Burnsville 10,577,867 7,689,798 -2,888,069 -116 -47 11 Rogers 3,986,050 1,100,886 -2,885,164 -729 -241 12 Wayzata 2,323,506 123,909 -2,199,597 -1,069 -532 13 Shakopee 6,698,876 4,630,858 -2,068,018 -155 -53 14 Minneapolis 51,741,779 49,817,942 -1,923,837 -11 -5 15 Chanhassen (combined) 3,563,523 1,666,901 -1,896,622 -215 -79 16 Oak Park Heights 2,214,196 415,839 -1,798,357 -848 -370 17 Mendota Heights 2,483,310 774,156 -1,709,154 -383 -153 18 Arden Hills 2,303,583 889,753 -1,413,830 -476 -151 19 Maplewood 6,639,024 5,275,009 -1,364,015 -89 -35 20 Notes: Hassan Township annexed by City of Rogers in 2012. Chanhassen in Hennepin County combined with Chanhassen in Carver County. Sources: Minnesota Department of Revenue, Property Tax Division. Population and household estimates as of April 1, 2013,from Metropolitan Council. Metropolitan Council January 2016 Fiscal Disparities in Twin Cities: Key Findings for Taxes Payable in 2015 How much tax base daes the pragram share in the seven-county metro area? • $367 million in shared pooi of area-wide tax base(net tax capacity) • 34%of total commercial, industrial and public utility property tax base • 11%of total taxable tax base How much tax revenue is shared? • $594 million in tax revenue for taxing jurisdictions o Revenue goes to cities,townships,counties,school districts and special taxing districts What are key findings for net recipients of shared tax base? Number of net recipients • 101 communities-84 cities and 17 townships o Distribution of shared tax base is more than contribution of tax base to shared pool Net recipients as share of inetro area • 3296 of commercial,industrial and public utility property tax base • 419�0 of commercial, industrial and public utility property tax base with net changes from fiscal disparities{distribution of shared tax base minus contribution of tax base to shared pool) • 39%of total taxable tax base • 51%of population Top five net recipients • St. Paul, Brooklyn Park,Coon Rapids, Brooklyn Center and Columbia Heights What are key�ndings for net contributors of shared tax base? Number of net contributars • 78 communities-53 cities and 25 townships plus State Fair Grounds o Contribution of tax base to shared pool is more than distribution of shared tax base Net contributors as share of inetro area • 6796 of commercial,industrial and public utility property tax base � 5$%of commercial,industrial and public utility property tax base with net changes from fiscal disparities(distribution of shared tax base minus contribution of tax base to shared pool) • 60%of total taxable tax base • 49%of population Top five net contributors • Bloomington, Eden Prairie, Minnetonka, Plymouth and Edina Top 20 net contributors as share of total commerciai-industrial tax base � 5996 of commercial, industrial and public utility property tax base in metro area Metropolitan Council February 2016 . � I,EAGUE oF CONNECTING & INNOVATING j�/�INNESOTA SINCE i913 �ITIES Fiscal Disparities 101 August 2416 Local government units within the Twin Cities metropolitan area,which is comprised of the counties of Anoka,Carver,Dakota,Hennepin,Ramsey, Scott, and Washington,have participated in a property tax base sharing program known as Metropolitan Fiscal Disparities since 1975.A similar program began in 1996 for local government units in the Taconite Area, which includes portions of the counties of St. Louis, Itasca, Crow VVing, and Aitkin, and all of Lake and Cook counties. Under these programs, a portion of the growth in commercial, industrial, and public utility property value of each community is contributed to a tax base sharing pool. Each community receives a distribution of property value from the pool based on the market value and population of each city. Contribution based on a distribution index. This index compares each city's total market value per The contribution to the pool is equal to 40 capita to the average market value per capita percent of the growth in commercial, for all cities and towns in the seven counties. industrial, and public utility value since the Cities that have relatively less market value base year(1971 for the Twin Cities; 1995 for per capita receive a relatively larger the Taconite Area). T'his measure of growth distribution from the pool than cities with includes both new construction and greater market value wealth per capita. inflationary increases in existing property values. In 2016, for example,the total amount of tax capacity contributed to the How are property taxes generated? Metropolitan fiscal disparities pool was '1'he tax capacity contributed to the pool $373.3 million. The contribution value is not ultimately translates into property tax dollars available for local tax purposes and therefore, for each local government. 'These property the contribution value must be subtracted taxes, also known as the distribution levy, are from the total tax capacity of each computed for each local govemment by community before the local tax rate is multiplying its distribution value by its prior computed. The Taconite Area program is year tax capacity rate. The distribution levy much smaller,with just over$9.3 million of represents the amount of each local tax capacity contributed in 2016. government's certified levy raised through the fiscal disparities program. The balance of DiStt'ibuti011 the certi�ed levy is used to compute the local tax rate. The t�capacity contributed to the pool is 145 UNIVERSITY AVE.WEST rHONE:(6S1)281-1200 Fn�c{(,51)281-1299 ST. PAUI. MN 55103-2044 Tou FxEE:($00)925-1122 WEB:WWW.LMG.ORG How are commercial/industria) and main goals that encapsulate several of the utility parcels taxed? original objectives: Commercial and industrial properties are not • Promote orderly urban planning and taxed twice. Instead, a portion of each development; and commercial or industrial property's tax • Work towards a more equitable capacity is taxed at the area-wide t�capacity distribution of fiscal resources. rate and the balance is taxed at the total local Assessment of the program's success in ta�c rate.As a simple example,in a communiry where exactly 40 percent of all accomplishing the second of these goals commercial, industrial, and utility property is often points out the"winners,"cities that are contributed to the fiscal disparities pool,40 net recipients, and"losers,"cities that are net percent of each paxcel's value is ta��ed at the contributars. Proponents of the program area-wide t�rate and 60 percent is taxed at focus on the relative uniformity of the the total local tax rate. In 2016, for example, �xation of commercial and industrial the Twin Cities area-wide tax rate was Property across the metropolitan area and the 150.262 percent and the Taconite Area-wide stability the net contributors provide to the tax rate was 160.736 percent. region as a whole. They argue that greater uniformity and stability give the entire region a competitive edge in national and global POIICy ISSUeS marketplaces. The original intent of the program was 'I'he critics of the system argue that the articulated through the following six contribution rate of 40 percent is arbitrary objectives: and that the distribution formula is solely • Provide a way for local governments based on the relative property ta�c base wealth to share resources generated by of each city. Also,the formula uses non- regional growth; adjusted assessment levels. Cities with high • Encourage orderly urban development assessment levels contribute more tax base by reducing competition for than cities with lower levels,creating a commercial and industrial disincentive to raise the assessment level. development; • Establish incentives for regional Although fiscal disparities is generally cooperation; considered to impact commercial and • Provide a way for regional resources industrial properties, a House Research study to be available through the existing found that homestead t�rates are also system of local governments; affected. For example,the homestead tax • Make resources available to rate in St. Paul was 8.8 percent lower in 2004 communities at the beginning stages because of the program. In the same year of development or redeveloprnent; Bloomington, a net contributor,experienced and a 5.5 percent increase in the average • Encourage environmental protection homestead ta�c rate. The study found that tax base sharing did not lead to such extreme Descriptions of the program, such as those changes in most cities. offered by the Minnesota House of Representatives Research Departtnent and Within cities,property classes can experience the Metropolitan Council, often highlight two the impacts of tax base sharing differently. 2 Declines in the market values for Twin Cities utility property value t�ed at the local ta�c area commerciaUindustrial properties in the rate. early 1990's not only directly shifted property tax burdens to other types of property, they 2012 Study also reduced the amount of commercial and An in-depth study of the seven-county metro industrial valuation contributed to the fiscal area fiscal disparities program was released disparities pool. As a result, the total in early 2012. It was done at the direction of distribution levy generated through the fiscal the legislature by a private consulting firm. disparities program was also reduced. In the The key research question was: what would mid-1990's,market value rebounds reversed the impact be on ta�c capacities,tax rates and this trend. But reductions in the tax levies if the program ceased to exist? The cornmerciaUindustrial and public utility authors found that tax capacities per capita property tax class rates by the 1997-2001 would decrease in all counties but Hennepin Legislatures have slowed growth in the tax if the program were eliminated. The analysis capacity of both the Metropolitan and showed that total tax rates would go up in Taconite Area fiscal disparities pools. When each county other than Hennepin. The full the amount of this distribution levy declines report is available on the Dept. of Revenue's or grows more slowly than the total tax base, website. a greater share of the local ta�c bill is paid by other types of properties, including the portion of each commercial, industrial, and Resources House Research: http:l/www.house.le�.state.mn.us/hrd/topics.asp?topic=21 The Metropolitan Council http:l/www.metrocouncil.orgJmetroarea/FiscalDisparities/index.htm Revised 08/201b 3