Category Archives: CIP

Northfield’s Complete Streets policy one of the nation’s best!

Posted on by
2

Northfield’s Complete Streets policy has been recognized as one of the top 10 policies in the country for 2012 (we ranked #5 out of the 125 Complete Streets policies adopted in the US in 2012).

What’s so great about having a Complete Streets policy?  My big policy goal is to link transportation and land use planning to increase the productivity and sustainability of Northfield.  To reach that goal requires some consciousness-raising, disseminating information about the costs of development for cities, and many incremental steps.  A Complete Streets policy is part of making transportation planning more intentional, better linked with surrounding land uses, and increasing awareness of the critical role streets play in cities’ budgets, safety, economic development, stormwater management, quality of life and, of course, getting around town.  By itself, the policy won’t accomplish much, but it is a piece of the bigger picture.

Here’s a bit more news coverage of the announcement: Envision MN highlights Northfield’s  accomplishment; Streetsblog provides some criticism about Complete Streets policies; Better Cities calls Complete Streets a “key strategy” for revitalization of cities.  Here’s some old coverage about some of the people who helped organize the Complete Streets effort in Northfield and even a mention in Rice County’s public health information.

 

Libraries as “landmarks, booksmarks, and people-marks”

Posted on by
2

 

Northfield Public Library

The New Republic has a rather lyrical review of library form and function: The Revolution at your Community Library.  Focusing on the architecture of community libraries, Sarah  Williams Goldhagen presents examples of “a new building type with a deceptively familiar name.”  In so doing, she also elegantly captures the evolution in libraries from a civic repository to places which “offer what no other contemporary building type provides: vibrant, informal, attractive, non-commercial community places where people of any age, class, gender, race, religion, or ethnicity can gather, and can obtain access to resources vital to full participation in contemporary life, including but not only the Internet.”

Northfield Public Library is all these things even if its physical form is still firmly rooted in its Carnegie repository history.  When it comes time to renovate and expand the library – the physical enclosure is getting pretty tight – it will be an interesting opportunity to hold on to the historical roots, status as civic icon, and create spaces which continue to foster “full participation in contemporary life.”

Have we outgrown zoning?

Posted on by
1

 Zoning is no longer appropriate, writes architect Roger Lewis in the Washington Post recently.  It is easy enough to agree – zoning is essentially segregation.  We put big houses here, little houses over there, multi-family housing way over there (check out some of the history of land use regulation and discrimination), industrial out there, and commercial on the highway.  The inappropriateness comes from both the inequities, but also the community costs in terms of excess infrastructure and unproductive development.

So, have we outgrown zoning?  Yes, but now what?  Here in Northfield, we have a pretty smart comprehensive plan which could use some updating and focusing.  Then we have some really lousy land use regulations which are slated for revision (and with some luck and leadership, for reform or replacement).  What a golden opportunity to move beyond putting things in their zones to plan and regulate for the long term health of the community.

Some inspiration (a very small selection):

Long term thinking, not easy short term answers: some thoughts from San Diego based Placemaker Howard Blackson.  Placemaking is rapidly becoming a planning buzzword which could become just as meaningless as “mixed use” (an oxymoron when you think about it), but I’d like to think of it simply as: identify and work with the specific characteristics of the place – Northfield – rather than overly generic solutions.  Here’s another good one from the Placemakers.

Don’t just ask the community “What do you want/like?” but also educate residents about the features, costs and benefits of various development choices.

Downtown is not a cute museum: work to reinvigorate downtown’s image as the vital and distinctive economic core of Northfield which generates significantly more tax revenue per acre than other areas.

Think local: Consider how supporting local businesses helps keep money in Northfield (some info about co-ops, infill and redevelopment) and how land use and related regulation can help rather than hinder local enterprises.

Streets are really, really important.  The street network helps define the density of a community, connects places within the city and the city to elsewhere, plays a huge role in safety, stormwater, municipal costs, economic development, and quality of life.  Street decisions are also long term and very hard to change. Indeed, how we manage car traffic is critical to thinking about other features of urban development.  Streets matter.

 

 

 

 

 

Rarely economical disappointing development

Posted on by
Reply

First, the NY Times series on subsidies and now the Strib has Art Rolnick (former head of research at the Minneapolis Fed) and business writer Mike Meyers bringing the Times’ information back to Minnesota in the context of Governor Dayton’s tax plan in The Subsidy Bonanza.

A few highlights:

  • Stadium subsidies are “part of a national pattern of taxpayers subsidizing some of the richest people in America.”
  • Minnesota outpaces the nation in job growth, but is not a big subsidizer.  So adding more taxpayer money to lure companies hasn’t proven effective, although it is expensive even for the small players (about 1 cent of every dollar in the Minnesota state budget).  Yet, “Study after study has shown the education of Minnesota’s workforce has been the key to the growth of high-quality jobs for the last half-century.”
  • A catalog of the Twin Cities projects which have been subsidized and not delivered on the promises: Best Buy, stadiums, City Center, Lawson Software…

Rolnick also commented on the Mayo deal over in Minneapolis/St Paul Business Journal comparing Mayo to the Vikings stadium deal.

 

 

Not all development patterns have the same price tag

Posted on by
5

And for my last Council meeting, the business park is on the agenda for discussion…so here’s one more attempt to ask questions about the cost and scope of this project.

The background as we know it: 530 acres annexed west of the hospital to be master-planned and developed as a business and residential development.  Required improvements include roads (to TH 19, North Avenue, Decker Avenue, 320th Street, “Cedar” Ave. and new interior roadways), sewer (including lift station), water (including elevated storage tank) which ”should not be assessed to business park property, increasing the cost of development.”  Phase I is estimated at about $14 million in improvements; Phases II-IV would add another $15 million. The breakdown of the development expected includes not just the commercial/industrial development we hear about most, but a substantial amount of housing and retail.

That cost of development issue should make everyone pause…

Of course, it would raise the cost of development to completely prohibitive levels if the costs were assessed to the property.  But, if the costs are not assessed to the property, that burden will fall to the City taxpayers (and state and perhaps federal taxpayers depending on the package of aid that’s cobbled together).  Further subsidies to attract business like tax abatement, TIF, etc. will further increase taxpayers’ costs and decrease the tax benefits.

1. My general question: how can we grow the tax base and add jobs without massive subsidies (which is what those infrastructure improvements would be) which would effectively shrink tax revenue to pay off the improvements.

2. My more specific question: how can the Council, staff, business community and taxpayers learn how much it is likely to cost them (and what assumptions about the rate of growth and the economy underlie those projections) and will that cost ever be recouped through tax revenue.

3. I also have question the wisdom of master planning an area which will take decades to build out.  My experience on the planning commission with residential development was that the master plan would be drafted, but within just a few years changes would be requested to adjust densities, change housing styles, subtract roads, change stormwater management, etc.  Is it likely that the lot layout, use designations, environmental/landscaping/natural features, etc. in the business park will help development or will the plan constrain business development over time?

My bottom line: Northfield has not evaluated the cost of this project for taxpayers over the long term and has not explored meaningful alternatives to reduce cost.  Indeed, the entire process has been conducted backwards with questions about feasibility, cost, location, etc. happening after the plan has been drawn without considering that not all development locations and patterns come with the same pricetag.

I am advocating for 2 things:

  • maximizing use of current infrastructure before building new (because we’ve already paid for it and are maintaining it). Extending infrastructure in the hope of development is a gamble with tax money I am not willing to take.
  • building in patterns which support density (to put more taxpayers per acre or per foot of pipe to support the infrastructure), but not for a particular look and feel.

A little digest of other things I’ve written and where I get my information:

From this blog (with links to many places):

From other places:

 

 

 

 

Different debate questions

Posted on by
Reply

Presidential debates usually make me think about moving to Canada since the likelihood of either candidate actually answering a question is abysmally low and the only excitement comes from the random zinger of a comment, factual screw up, or public speaking trainwreck (I depend on the Brits for the most entertaining and pointed commentary and American media for the transcript).  I’d like to believe, however naively, that the President of the United States does more than repeat familiar phrases or score points for verbal jabs in the course of his employment.

I would like some answers from candidates, though, and Chuck Marohn has a different list of questions over on Strong Towns which get at some of the issues I care about. It might be fun to ask them on the local level, too, and see if we can get beyond repeating the usual answers and catchphrases about growth, infrastructure, regulation and the like to ask what would really work and what it would cost.

 

If MNDoT can do it…

Posted on by
Reply

I’ve already written about MNDoT’s new context-sensitivity and efforts to engage citizens and city officials.  Then I attended a CIMS – that’s Corridor Investment Management Strategy – conference in Owatonna a few months ago dealing with the I-35 corridor and related routes a few months ago.  The latest to come from the CIMS meeting is a website dedicated to gathering citizen input to help MnDOT Develop Evaluation Criteria for the CIMS Advancing Minnesota’s Sustainable Solutions Solicitation.  The “solicitation” is a competition for $30 million to fund trunk highway projects that improve quality of life, environmental health or economic competitiveness and so MNDoT is asking for input to develop the criteria by which quality of life, environment and economic competitiveness are judged.  So far, there are 5 proposed evaluation criteria including whether a project advances multimodal access or improves air quality – go add your own or comment on what’s there (don’t forget to look at the Minnesota GO plan for more information on MNDoT’s planning)

So, if MNDoT can do this on a statewide basis, why couldn’t Northfield do this for budget issues, parks, streets, etc.?

 

Safety Center financing – big update

Posted on by
2

Tuesday is a big day in the safety center financing process.  The Council will vote on a resolution to approve the lease-revenue financing transaction – we will vote to close the deal, in other words.

The package of documents is 551 pages, but the collection of documents is quite straightforward, so don’t let the size (or the legalese) overwhelm you (nor the handwaving on Locally Grown).  The documents itemize the parts of the deal and allocate risks.  To repeat – the documents describe the deal and are intended to allocate the risks among the parties.  Much of the length is from the repetition of relevant definitions and terms in each document, as well as the requirements of securities law which are extensive.

300 of the pages are the 2011 Comprehensive Annual Financial Report (CAFR) which the Council reviewed and accepted in July (the auditor’s presentation gives a quick summary)

Of the remaining 200 pages:

1-5: Finance director Kathleen McBride’s memo which itemizes everything else in the packet – it’s a good summary of who is involved and the documents in the packet.

6-12: The resolution by which the Council authorizes the transaction and approves the financing documents.  The three provisions (repeated throughout the documents) to highlight are (1) these are not general obligations of the City (the full faith and credit of the City are not pledged to pay these obligations), (2) the City must appropriate payment annually (Failure to appropriate funds annually is at the sole discretion of the Council), and (3) the certificates of participation (COPs) are tax-exempt.

13-25: Ground lease

  • Deal: Northfield has already purchased the property for the project – the Cowles property – on Riverview Drive off Highway 3.  Now the City will lease the land for $1 to US Bank for the duration of the lease-purchase deal below.
  • Risks: Since this is about land, the site lease puts the burden for ensuring good title, proper zoning, etc., and no environmental hazards on the City as owner/lessor.  But the meat of it is the termination section: 3 ways the site lease can terminate, all dependent on the lease purchase agreement: (1) full payment of the lease below (that’s the $6.28 million) at the end of the term, (2) prepayment of the lease, or (3) non-payment either by failing to appropriate the rental payments each year or by default (money appropriated but not paid for some reason).  These termination events are repeated throughout the documents.

26-68: Lease-purchase agreement

  • Deal: The City agrees to pay rent to lease the property resulting in the purchase when the obligation is paid (either at the end of the term or sooner if prepaid); the Trustee agrees to lease the “lease property” which includes “the Project” (design, construction, installation, and equipping of an approximately 26,653 sq.ft. public safety center on the site), site improvements, etc.
  • Lease term: date of issuance to April 2, 2033 and expires at earliest of: full payment, prepayment, or non-payment as above.
  • City makes Base Rental payments and Additional Rentals (utilities, insurance, etc.)
  • City operates and maintains the property in an appropriate manner and other typical language about who owns improvements
  • City constructs the project according to Agreement to Construct (below) which stipulates that
  • Trustee holds title to the property until City completes payment
  • Risks:
  • If lease expires for non-payment, the city has 45 days to vacate the site, deliver equipment (personal property or equipment financed with the proceeds from the sale of the certificates of participation) and any monies already appropriated must be paid.
  • If construction exceeds the $6.28 million, the City must pay any excess costs
  • Nonappropriation may be cured by the City within a reasonable time – so, let’s say a Council fails to appropriate funds in the (statutorily mandated) December 15 budget.  New Council takes its seats on January 1 and could pass a budget amendment to appropriate the rent payments and save the deal.
  • The City is not obligated (because it’s not a general obligation) to make payments or purchase the facility.  The risk here is to the trustee, but in practice, the likelihood of the city walking away is extremely low.
  • City has the burden of maintaining the property and using it only in ways that maintain the tax-exempt status of the investment

69-132: Indenture of trust (having nothing to do with indentured servitude which is about the only use of “indenture” outside the legal world)

  • Deal: an agreement between the City (the bond issuer) and US Bank (the trustee which administers the lease for purchasers) which details the rules and responsibilities of each party.  The trustee receives payments from the City, pays the owners, and manages the legal requirements of the securities (which are substantial).  This document is technical securities market stuff.

133-154: Agreement to construct: just what it sounds like

  • Deal: City agrees to construct the safety center; Trustee agrees to pay for it from the proceeds of the sale of the COPs
  • Risks:
  • Fixed Price if the construction costs exceed the proceeds of the sale of COPs, the city pays.  The city may execute change orders in the project, but the maximum price is fixed.  If the project comes in under budget, the city gets that benefit.
  • Scheduled completion date is October 31, 2014 (actual completion date is when appropriate documentation of completion is delivered).  City uses best efforts to meet this schedule, but it is not a default if the scheduled completion is exceeded.
  • Typical construction contract language defining default in the construction (rather than the payments to the trustee) such as the city failing to use best efforts to meet the date, not constructing the building to the appropriate standards, etc.

155-161: Continuing disclosure undertaking: More securities regulation stuff.  The City agrees to provide annual financial information, reports of “material events” and other documentation intended to give securities holders information about risks involved with their investment (I believe this is required for any bond issue).

162-177: Certificate purchase agreement

  • Deal: Agreement for the City (issuer) to sell the entire issue of COPs – the $6.28 million package – to Dougherty & Co (underwriters) to market to investors by means of the Official Statement; the Official Statement (included as the Preliminary Official Statement below and finalized when the deal closes) is the prospectus or marketing material from Dougherty to investors describing the COPs.  Again, securities regulation stuff describing the actual issuance details.  Also sets the COP amount, rate and yield at closing which will take place tomorrow morning.

178 (Preliminary) official statement describes the terms of the COPs and provides extensive information about the City, the agreements which make up the project for which the COPs are sold described above, the rating from Standard & Poors (AA-) and other information intended to help investors make an informed choice about the risks of the investment and its appropriateness for their portfolio.  The risks include the repetition that these securities are not general obligations and the City is not required to appropriate funds which knowledgeable investors would measure against the AA- rating and their review of the City’s financial outlook as revealed in the 300 page CAFR.

The rest of the packet is copies of earlier materials including the authorizing statute, RFP for the underwriter for the COPS and the scoring of the proposals received, timeline, and the statement issued by the Council to inform the public about our choice of financing.

Stormwater

Posted on by
1

Trickle down economics

Perhaps, after reading the Northfield News on Wednesday, you think the City Council has agreed to some new stormwater fee with which to punish businesses who want to expand.  No, the Council is making decisions to address the trickle down economics of stormwater management.

Stormwater is regulated at the federal level through the Clean Water Act.  The MPCA administers CWA programs and any additional Minnesota stormwater regulations.  Northfield has what’s called a designated MS4 permit. This permit requires, since we can’t stop storms, that Northfield develop a SWPPP (that’s a stormwater pollution prevention program) that incorporates BMPs (best management practices) to manage the water once it hits the ground (or the roof).  To complexify matters, the Cannon River is Outstanding Resource Value Water which requires specific (additional) BMPs mostly concerning construction and in a buffer zone near the river – check out the cool impaired waters map.

The basic principle is to reduce runoff reaching the river by infiltrating water on-site.  Impervious surfaces whether natural (bedrock) or manmade (pavement, roofs, buildings) don’t allow infiltration, so the City must find ways to divert that runoff to regional ponds, nearby swales or raingardens.  Here’s how we do it

  • All property pays a monthly stormwater utility fee to pay for the construction and maintenance of stormwater infrastructure
  • Anyone – commercial or residential – who applies for a building permit (for a project which has stormwater implications), plat, or site plan review must submit a stormwater management plan.  The SWAC (stormwater access charge) approved Tuesday is for those properties where no management is possible on-site – like those in the completely built up downtown – and so we have established a fee in lieu of on-site infiltration which is analogous to the better known SAC/WAC (sewer and water access charges, respectively) as a buy-in to the stormwater system.  We must, to reduce stormwater runoff under the MS4 and pay for the city’s system, charge a fee something like this.  We can argue about whether the theoretical raingarden calculation model is the right one, we can consider whether it is a useful economic development tool to subsidize this fee to encourage development, and we can think about whether there are other incentives and tools (how much green roof would one need, for example, to reduce the stormwater sufficiently or what if a property owner made all pavement pervious?  What about rain water harvesting?).
  • Construction projects have additional regulations about managing runoff, sediment and erosion.

 

Budget thoughts

Posted on by
6

When there’s trouble I am not slow. It’s up, up, up and away I go! (to make good policy in a city I know)

On Think Twice, former members of the Locally Grown triumvirate (or perhaps that’s members of the former triumvirate) were chatting about their top city issues – including the City budget.  To cherry pick a few ideas – the budget should reflect citizen priorities and the City should present better, clearer budget information.

Priorities: The budget should reflect citizen priorities, but in practice it’s not so simple.  First, we need to determine what the collective priorities are (see my post on the community survey) and then we still have to make  decisions about spending as a result of them.  The two-pronged solution is gather lots of community input as we make policies like the Comprehensive Plan, Comprehensive Economic Development Plan and all the other plans, then work to implement them incrementally + work harder to engage citizens on an on-going basis to gather more input and check our work.

Some of our costs are driven by regulations and external factors over which we have no control or no direct control – the unfunded mandate problem.  Two issues in the news lately where this matters: stormwater and election costs.

Clearer budget information: Yes, this is a biggie and not just for the public, but for the Council, too.  Council action and the subsequent media reporting (newspaper, radio and this blog) works one budget decision at a time (“The Council voted to spend…”) and we often get bogged down in the details rather than the bigger picture – policy to the rescue.

For the Council, the big challenge ought to be developing sound policy to guide decisions, then using those policies to guide decisions.  Take the recent Safety Center financing – ideally, we would have thought carefully (and transparently) about what kinds of debt the city would issue, what type of debt would be issued for what type of project, what limits on debt or debt service costs, etc.  I believe Council members had their own well-thought out capital spending policies in their heads, but that’s not the same as a publicly available policy adopted by Council action.

If we pointed to a capital facilities policy that stated essential facilities (we could even itemize these) will be financed without a referendum where there is demonstrated need because (1) elected decision-makers are best situated to make the determination of need, (2) have critical information for determining the scope and timing of the project in the context of the city’s finances, (3) to insulate essential services from political will (with the safeguard that elected officials must stand for re-election), and (4) provide certainty and control for the project, then I believe the decision would have been much less of a surprise. It might also have helped focus on the policy problem of what issues should be put to referendum before we are trying to get a specific project underway.  Maybe the policy debate would have lead to a conclusion that we should put ALL facilities to a referendum or only those over some number of millions of dollars.  Or, perhaps recreational facilities require a referendum to issue bonds.  The policy could include guidelines for what might be financed via the EDA or HRA (with input from those bodies).

Over on Locally Grown, there’s discussion about utility franchise fees – Northfield already has a cable franchise fee, but we have considered adopting an additional franchise fee for electric and gas utilities for right-of-way access to be dedicated to street improvements.  Policy documents would be the place to establish and explain what revenue sources are available to the City (and by what authority – typically state statute), what additional taxes or fees are (or could be) adopted and what the revenue would be used for (if it is to be restricted).

In this larger context, a utility franchise fee could be evaluated as one tool to choose to put in the toolbox.  One of the charges to our ad hoc finance task force was to research how we could diversify revenue and they brought the utility franchise fee option to us.  Whether this fee is a good idea should consider the (possibly competing) goals of diversifying revenue to reduce reliance on property taxes and local government aid, equity and fairness (who will this fee affect and is that fair), ensuring transparency about the fee (obviously, we charge the utility which will pass along the cost to its rate payers) and the relationship of the proposed fee to the designated projects, etc.

Putting policies to paper or bytes also helps explain the tools we have to use for City work, provides a framework for Council and staff to act coherently, and gives citizens a yardstick by which to measure the Council’s performance – did we do what we said we’d do and do the policies reflect your priorities?  Transparency and accountability, in other words.