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041524 Work Session Meeting Packet      CITY COUNCIL  WORK SESSION MEETING    New Hope City Hall, 4401 Xylon Avenue North  Northwood Conference Room    Monday, April 15, 2024  6:00 p.m. ‐ dinner  6:30 p.m. – work session    Mayor Kathi Hemken  Council Member John Elder  Council Member Andy Hoffe  Council Member Michael Isenberg  Council Member Jonathan London      1. CALL TO ORDER – April 15, 2024    2. ROLL CALL    11. UNFINISHED & ORGANIZATIONAL BUSINESS     11.1 Dialogue with Planning Commission   11.2 Discuss the new 4d(1) tax law   11.3 Discussion regarding the preliminary findings of the 2024 Classification and  Compensation Study Update   11.4 Consideration of a Nomination for the Good Citizenship Award    12. OTHER BUSINESS    13. ADJOURNMENT  https://newhopemn.sharepoint.com/sites/Files/All User Access/RFA/COMM DEV/2024/Work Session/04‐15‐24 PC Update to CC/WS ‐ Planning Commission Update 04‐15‐ 24.docx   Request for Action  April 15, 2024    Approved by: Reece Bertholf, City Manager  Originating Department: Community Development  By: Jeff Sargent, Director  Agenda Title  Planning Commission dialogue with City Council  Requested Action  The City Council has requested the opportunity to meet with the Planning Commission on an annual basis to  receive updates on Planning Commission activities. Staff requests that representatives from the Planning  Commission present an update to the City Council.  Policy/Past Practice  The Planning Commission provides updates to the City Council approximately once per year. The last update  was presented at the April 17, 2023, work session meeting. This update will include all cases the Planning  Commission has reviewed since that time.  Background  The Planning Commission carries on planning activities regulating future physical development, platting of  properties and subdivision of land in the city, and makes recommendations to the City Council regarding  matters affecting zoning, platting, commercial/industrial expansions, redevelopment, and public  improvements. Meetings are held the first Tuesday of the month at 7:00 p.m.    Currently, the Planning Commission member roster has eight of its nine members. The city is actively seeking  applications for the final seat on the commission. The following is a list of the current Planning Commission  members, along with when they were appointed and when their current term expires:    Commissioner Appointed Term Ends  Ray Alkalai 01/10/22 12/31/24  Don Collier 07/25/22 12/31/24  Howard Kaplan 01/10/22 12/31/24  Heather Koshiol 02/08/21 12/31/25  Roger Landy 09/12/94 12/31/24  Matt Mannix, Chair 01/23/17 12/31/25  Michael Redden 05/22/17 12/31/25  Mike Terres 01/10/22 12/23/24  Vacant          The Planning Commission has reviewed and made recommendations on the following redevelopment efforts  and land use approvals since April 17, 2023:      Agenda Section Work Session Item Number  11.1    Request for Action, Page 2  Recent redevelopment actions:   (2023) Recommended approval of a Conditional Use Permit (CUP) for the deferment of parking at 5017  Boone Avenue (Horizon Roofing).   (2023) Recommended approval of a CUP amendment for open outdoor storage at 9210 Science Center  Drive (Pallet One MN, Inc).   (2023) Recommended approval of a site plan review for the Public Works Central Garage expansion,  located at 5500 International Parkway.    Upcoming items for consideration. The Codes and Standards Committee met on January 21, 2024, to discuss  possible text amendments to the zoning code. The following will be presented to the Planning Commission in  May:    1. Boarded Homes  The Committee supported implementing restrictions on the length of time plywood can be installed on  a property. It was recommended that the installation of plywood be limited to no more than 60 days,  unless there was an open building permit related to the work, in which case there would be no time  limit. Vacant properties secured by the city would be exempt from the limit. Violators of the ordinance  would be subject to fines through the Administrative Citation process.    2. Open Outdoor Storage  The Committee suggested amending the zoning code to allow religious and institutional uses the option  to store utility trailers and vehicles on their property through the conditional use permit process. The  utility trailers and vehicles would need to belong to the owner of the property, or an organization  affiliated with or sponsored by the owner. Both would need to be licensed and operable and stored on  a bituminous surface. Required parking stalls could not be used for storage and storage could not take  place within drive aisles, loading areas, or fire lanes.    3. Fence Definition  It was suggested that city staff develop a fence definition to be incorporated into the zoning code. A  hybrid definition combining two of the examples that were provided by staff was suggested. Staff will  work with the city planner to create a proposed definition to be presented to the Planning Commission.    4. In Home Daycares  The Committee recommended amending the zoning code to specify that in home daycares would be  subject to home occupation regulations. In home daycares are permitted uses in the R‐1, R‐2, and R‐3  zoning districts. The Committee did not feel the zoning code should be amended to allow additional  employees/owners/family members not living at the home to assist with the home occupation.    5. Parking Lots  The Committee had no objections to adding language to Section 3‐1 (permit application) of the City  Code specifying that a permit is required for parking lot projects. Parking surface and maintenance  requirements would be removed from Chapter 8 (licensing) and addressed in Chapter 4 (zoning).  Language pertaining to permits required for driveways on private property would also be moved from  Section 6‐7 (street excavation) to Section 3‐1 (permit application).      Request for Action, Page 3  6. Trade School Definition & Similar Uses   The Committee was supportive of amending the definition of a trade school to avoid any potential  confusion related to the use. It also suggested considering disallowing health and social service uses,  day care centers, and sports training centers within the Industrial zoning district.          https://newhopemn.sharepoint.com/sites/Files/All User Access/RFA/COMM DEV/2024/Work Session/04‐15‐24 4d Tax Law/04‐15‐24 New 4d Tax Law.docx   Request for Action  April 15, 2024    Approved by: Reece Bertholf, City Manager  Originating Department: Community Development  By: Jeff Sargent, Director  Agenda Title  Discuss the new 4d(1) tax law  Requested Action  Staff requests to provide an update to the City Council on the new 4d(1) tax law and its impact to the city’s tax  capacity and revenue.  Policy/Past Practice  It is a past practice of staff to update the City Council on new laws that will impact the city.  Background  In September 2023, the state enacted a property tax bill that adjusted the 4d(1) class rate for affordable housing  properties. A property is considered affordable if: at least 20% of the units are offered to individuals earning  60% (or less) of the average median income, if at least 20% of the units are considered Section 8, or if at least  20% of the units received Low Income Housing Tax Credits.    Prior to the new adjustment, the class rate for the first $100,000 of value of affordable housing properties was  0.75%, with the remaining value taxed at 0.25%. Now, the entire value of an affordable housing property is  taxed at 0.25%.    Impact to New Hope  Staff has identified nine properties in New Hope that qualify as affordable housing:    Parcel ID Address Total Units Property Name  18‐118‐21‐11‐0015 8201 45th Avenue N 105 North Park Plaza Apartments  06‐118‐21‐41‐0013 8007 Bass Lake Road 41 Amorce II‐Park Acres  18‐118‐21‐11‐0017 8151 45th Avenue N 26 Winnetka West  05‐118‐21‐31‐0110 7300 Bass Lake Road 34 Bass Lake Court Townhomes  05‐118‐21‐32‐0004 7610 Bass Lake Road 11 Bass Lake Apartments  06‐118‐21‐34‐0022 5501 Boone Avenue N 35 Linden Place  05‐118‐21‐22‐0128 6113 West Broadway 68 Compass Pointe  05‐118‐21‐32‐0001 5601 Quebec Avenue N 140 Bass Lake Crossing  17‐118‐21‐22‐0002 4215 Rhode Island Avenue N 87 Kings Manor    According to Hennepin County’s website, the taxable market value of these properties based upon pay 2024  was $66,521,000. The local tax capacity prior to the new class rate adjustment was $430,068, with the city’s  portion being $256,165.    With the new class rate adjustment and using the same taxable market value of the properties at $66,521,000,  the new local tax capacity is lowered to $166,303, with the city’s portion being $99,056.  Agenda Section Work Session Item Number  11.2    Request for Action, Page 2  Therefore, the tax impact to the city is approximately $157,109 less revenue per year in taxes collected from  these properties.    Attached is a breakdown of the taxes generated by these properties prior to and after the class rate adjustment,  as provided by Ehlers. Stacie Kvilvang from Ehlers will also be in attendance to help answer any questions that  the Council may have on this topic.    Attachments   4d(1) Tax Impacts Table    Pay 24 Taxes - Splite Tax Rate at .75%/.25% with $100,000 as base value per unitExempt Class Rate (Exempt) 0.00%32.5193% Pay 2024 Prelim Commercial Industrial Preferred Class Rate (C/I Pref.)123.0260% Pay 2024 Prelim First $150,000 1.50%125.509% Pay 2024 Prelim Over $150,000 2.00%59.564% Pay 2024 Prelim Commercial Industrial Class Rate (C/I) 2.00%34.546% Pay 2024 Prelim Rental Housing Class Rate (Rental) 1.25%24.248% Pay 2024 Prelim Affordable Rental Housing Class Rate (Aff. Rental)7.151% Pay 2024 Prelim First $100,000 0.75%30.0000% Pay 2024 Prelim Over $100,000 0.25%0.22041% Pay 2024 Prelim Non-Homestead Residential (Non-H Res. 1 Unit)First $500,000 1.00%Over $500,000 1.25%Homestead Residential Class Rate (Hmstd. Res.)First $500,000 1.00%Over $500,000 1.25%Estimated TaxableMarket Value Market Value Total Taxable Property Tax Local Fiscal Disparities StateArea/Phase New Use Per Sq Ft/Unit Per Sq Ft/Unit Sq Ft/Units Market Value Class Tax Capacity Tax Capacity Tax Capacity18-118-21-11-0015 89,514 89,514 105 9,399,000 Aff. Rental 70,493 0 006-118-21-41-0013 137,875 137,875 40 5,515,000 Aff. Rental 33,788 0 006-118-21-41-0013 615,000 615,000 1 615,000 Aff. Rental 2,038 0 018-118-21-11-0017 116,538 116,538 26 3,030,000 Aff. Rental 20,575 0 005-118-21-31-0110 87,941 87,941 34 2,990,000 Aff. Rental 22,425 0 005-118-21-32-0004 60,364 60,364 11 664,000 Aff. Rental 4,980 0 006-118-21-34-0022 169,000 169,000 35 5,915,000 Aff. Rental 32,288 0 005-118-21-22-0128 181,074 181,074 68 12,313,000 Aff. Rental 64,783 0 005-118-21-32-0001 114,286 114,286 140 16,000,000 Aff. Rental 110,000 0 017-118-21-22-0002 115,862 115,862 87 10,080,000 Aff. Rental 68,700 0 0TOTAL66,521,000 430,068 0 0Note: Market values are based upon pay 24 values per review of county website on 2-9-24City County School Total Local Fiscal Disparities Mk Value State-widePortion Portion District Taxes Taxes Taxes Taxes$41,988$24,352 $17,093 $5,041 $88,474 $0 $15,537 $0 $104,012$20,125$11,672 $8,193 $2,416 $42,406 $0 $7,447 $0 $49,853$1,214$704 $494 $146 $2,557 $0 $449 $0 $3,006$12,255$7,108 $4,989 $1,471 $25,823 $0 $4,535 $0 $30,358$13,357$7,747 $5,438 $1,604 $28,145 $0 $4,943 $0 $33,088$2,966$1,720 $1,208 $356 $6,250 $0 $1,098 $0 $7,348$19,232$11,154 $7,829 $2,309 $40,524 $0 $7,116 $0 $47,640$38,587$22,380 $15,708 $4,633 $81,308 $0 $14,279 $0 $95,587$65,520$38,001 $26,673 $7,866 $138,060 $0 $24,245 $0 $162,305$40,920$23,733 $16,658 $4,913 $86,225 $0 $15,142 $0 $101,367TOTAL$256,165 $148,571 $104,283 $30,754 $539,773 $0 $94,791 $0 $634,565Fiscal Disparities Contribution RatioFiscal Disparities Metro-Wide Tax RateLocal Tax Rate: City Tax Rate: City of New Hope, MN FUTURE PROPERTY INFORMATION (Property Tax Capacity)FUTURE TAX CALCULATIONSNew UseMiscTOTALMarket Value Tax Rate (Used for total taxes)TAX CLASSIFICATION & RATESCounty Tax Rate: School District Tax Rate: Miscellaneous Tax Rate: State-wide Tax Rate (C/I only. Used for total taxes) Pay 2025 Taxes - Flat Tax Rate of .25%Exempt Class Rate (Exempt) 0.00%32.5193% Pay 2024 Prelim Commercial Industrial Preferred Class Rate (C/I Pref.)123.0260% Pay 2024 Prelim First $150,000 1.50%125.509% Pay 2024 Prelim Over $150,000 2.00%59.564% Pay 2024 Prelim Commercial Industrial Class Rate (C/I) 2.00%34.546% Pay 2024 Prelim Rental Housing Class Rate (Rental) 1.25%24.248% Pay 2024 Prelim Affordable Rental Housing Class Rate (Aff. Rental)7.151% Pay 2024 Prelim First $100,000 0.25%30.0000% Pay 2024 Prelim Over $100,000 0.25%0.22041% Pay 2024 Prelim Non-Homestead Residential (Non-H Res. 1 Unit)First $500,000 1.00%Over $500,000 1.25%Homestead Residential Class Rate (Hmstd. Res.)First $500,000 1.00%Over $500,000 1.25%Estimated TaxableMarket Value Market Value Total Taxable Property Tax Local Fiscal Disparities StateArea/Phase New Use Per Sq Ft/Unit Per Sq Ft/Unit Sq Ft/Units Market Value Class Tax Capacity Tax Capacity Tax Capacity18-118-21-11-0015 89,514 89,514 105 9,399,000 Aff. Rental 23,498 0 006-118-21-41-0013 137,875 137,875 40 5,515,000 Aff. Rental 13,788 0 006-118-21-41-0013 615,000 615,000 1 615,000 Aff. Rental 1,538 0 018-118-21-11-0017 116,538 116,538 26 3,030,000 Aff. Rental 7,575 0 005-118-21-31-0110 87,941 87,941 34 2,990,000 Aff. Rental 7,475 0 005-118-21-32-0004 60,364 60,364 11 664,000 Aff. Rental 1,660 0 006-118-21-34-0022 169,000 169,000 35 5,915,000 Aff. Rental 14,788 0 005-118-21-22-0128 181,074 181,074 68 12,313,000 Aff. Rental 30,783 0 005-118-21-32-0001 114,286 114,286 140 16,000,000 Aff. Rental 40,000 0 017-118-21-22-0002 115,862 115,862 87 10,080,000 Aff. Rental 25,200 0 0TOTAL66,521,000 166,303 0 0Note: Market values are based upon pay 24 values per review of county website on 2-9-24City County School Total Local Fiscal Disparities Mk Value State-widePortion Portion District Taxes Taxes Taxes Taxes$13,996$8,117 $5,698 $1,680 $29,491 $0 $5,179 $0 $34,671$8,212$4,763 $3,343 $986 $17,305 $0 $3,039 $0 $20,343$916$531 $373 $110 $1,930 $0 $339 $0 $2,269$4,512$2,617 $1,837 $542 $9,507 $0 $1,670 $0 $11,177$4,452$2,582 $1,813 $535 $9,382 $0 $1,648 $0 $11,029$989$573 $403 $119 $2,083 $0 $366 $0 $2,449$8,808$5,108 $3,586 $1,057 $18,560 $0 $3,259 $0 $21,819$18,335$10,634 $7,464 $2,201 $38,635 $0 $6,785 $0 $45,420$23,826$13,818 $9,699 $2,860 $50,204 $0 $8,816 $0 $59,020$15,010$8,706 $6,110 $1,802 $31,628 $0 $5,554 $0 $37,183TOTAL$99,056 $57,451 $40,325 $11,892 $208,725 $0 $36,655 $0 $245,379Market Value Tax Rate (Used for total taxes)FUTURE PROPERTY INFORMATION (Property Tax Capacity)FUTURE TAX CALCULATIONSNew UseMiscTOTALLocal Tax Rate: City Tax Rate: County Tax Rate: School District Tax Rate: Miscellaneous Tax Rate: State-wide Tax Rate (C/I only. Used for total taxes)City of New Hope, MN TAX CLASSIFICATION & RATESFiscal Disparities Contribution RatioFiscal Disparities Metro-Wide Tax Rate https://newhopemn.sharepoint.com/sites/Files/All User Access/RFA/HR & Admin Svcs/Human Resources/2024/Council Worksessions/Q ‐ 2024 Compensation Study  Update.docx   Request for Action  April 15, 2024    Approved by: Reece Bertholf, City Manager  Originating Department: HR & Admin Services  By: Rich Johnson, Director    Agenda Title  Discussion regarding the preliminary findings of the 2024 Classification and Compensation Study   Requested Action  Staff requests the opportunity to discuss with the City Council preliminary results of the 2024 Classification  and Compensation Study conducted by Flaherty & Hood, P.A.   Policy/Past Practice  The City conducts compensation studies to ensure that the City’s compensation system is competitive and to  ensure it is compliant with the Minnesota Pay Equity Act.     Background  The City’s current job evaluation system (SAFE System) was implemented following the 2010 compensation  study which was conducted by Springsted, Inc. (now Baker Tilly). In 2017, the City again utilized the services  of Springsted, Inc. to conduct a compensation study update.     It is considered an industry best practice for entities to conduct a compensation study at a minimum of every  six to seven years to ensure their compensation and benefits are competitive. Therefore, in 2023 staff requested  and the City Council approved funding for a compensation study to be conducted.     After issuing a request for proposals and reviewing two vendor submissions, Flaherty & Hood, P.A. was  chosen to conduct the study. After consulting Flaherty & Hood, it was determined the same cities used since  2010 would continue to be used in the current study as they remain comparable to the City of New Hope.    Nicholas Garcia and Ethan Rundquist from Flaherty & Hood, P.A. will be present to review the findings of  the study with the Council this evening, answer any questions that the Council may have, and discuss next  steps to be taken.    Agenda Section Work Session Item Number  11.3  https://newhopemn.sharepoint.com/sites/Files/All User Access/RFA/City Manager/Good Citizenship RFAs/Q‐good citizenship nom 4.15.24 wksess.docx   Request for Action  April 15, 2024    Approved by: Reece Bertholf, City Manager  Originating Department: City Manager  By: Valerie Leone, City Clerk‐Treasurer  Agenda Title  Consideration of a nomination for the Good Citizenship Award  Requested Action  Council is asked to review recent nomination(s) for the Good Citizenship Award.   Background  In September, 2011, the Council adopted a new program to recognize persons exemplifying good citizenship.  The Council agreed to consider nominations upon receipt rather than following a pre‐established schedule.     The Human Rights Commission recently promoted the program, and the city has received a nomination for  Tom Wiblishhauser for volunteering as a math tutor at Cooper High School, helping with numerous projects  at Holy Nativity Church, and advocating for families in need.     If Council supports the nomination, the recipient would be invited to future council meeting(s) for presentation  of the award.    Attachments   Nomination form    Agenda Section Work Session Item Number  11.4