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8.3 Adv & Auth Magnolia HillsCITY OF SALINA REQUEST FOR CITY COMMISSION ACTION DATE TIME 5/21/2007 4:00 P.M. AGENDA SECTION ORIGINATING DEPARTMENT: APPROVED FOR NO: 8 AGENDA: DEPARTMENT OF PUBLIC WORKS ITEM NO. 3 BY: BY: Karlton Place Page 1 ITEM: Resolution No. 07-6395 Approval of Advisability and Au thorization Resolution No. 07-6395 related to establishment of a special improvement district for street, drainage, water, and sanitary sewer improvements in Magnolia Hills Estates, Phase 2. BACKGROUND: The attached Petition No. 4297 was submitted by Mr. Kelly R. Dunn, President of Magnolia Hills, Inc., on May 17, 2007 requesting certain street, drainage, water, and sewer improvements to serve 25 residential lots in Magnol ia Hills Estates. Please see th e attached petiti on and preliminary engineering feasibility report for a detailed description of the benefit district. It is prescribed by Kansas State statutes that the City Commission consider a petition for street, drainage, sewer, and water improvements and establish sufficiency on the basis that any one of the following three conditions be met: 1. The petition is signed by a majority of the resident owners of record of property liable for assessment under the proposal. 2. The petition is signed by the resident owners of record of more than half of the area liable for assessment under the proposal. 3. The petition is signed by the owners of record, whether resident or not, of more than half of the area liable to be assessed under the proposal. In this case condition No. 1 above is met. T herefore, the petition cl early meets the statute requirements for sufficiency. T he Saline County Treasurer has i ndicated there are no delinquent taxes or special assessments on any property within the benefit district owned by the petitioners. The engineering feasibility report for these public im provements is attached for your review. The report describes the scope of the project, the improvement district, the method of assessment, cost estimate breakdowns for each improvement, and identifies and describes the properties in the benefit district. One Hundred percent (100%) of the cost of the improvements are proposed to be assessed to the benefit district. These cost estimate s include construction, construction contingencies, inspection, design, and bonding/interest costs. The property owners may choose to pay their share of the project costs as a lump sum payment in the spring of 2008 or as a special assessment ta x over a 15-year period beginning in December, 2008. The petitioner has the option of submitting a letter of credit for 35% of the project costs or 20% in cash for financial security which will be due before the City Commission can award the bid. The bid date for the project is tentatively scheduled for June 19, 2007. FISCAL NOTE: All costs (estimated at $566,346.12) are to be assessed against the improvement district, with a per lot assessment estimated to be $22,653.84. This project will be temporarily financed through a temporary note, likely issued August 1, 2007, and rolled into lo ng term bonds in 2008. Property owners will have the opportunity to pay the assessment in full prior to the bond issue. If they elect not CITY OF SALINA REQUEST FOR CITY COMMISSION ACTION DATE TIME 5/21/2007 4:00 P.M. AGENDA SECTION ORIGINATING DEPARTMENT: APPROVED FOR NO: 8 AGENDA: DEPARTMENT OF PUBLIC WORKS ITEM NO. 3 BY: BY: Karlton Place Page 2 to do so, the assessment plus related interest costs will be spread over 15 years in equal annual installments. As with any assessm ent project, there is a certain am ount of default risk, which will place demands on the property tax. Default dur ing the construction period is covered by the developer's financial security requirements previously outlined. Non-payment of assessments after the expiration of the developer's security is handled by Saline County in the same manner as delinquent taxes. We do not antici pate any assessment deferrals or cost recovery features to be associated with this development. COMFORMANCE WITH STRATEGIC PLAN: The City will provide the highest quality of services, consistent with governing body direction, available resources, and staff commitment to quality. Staff believes this infrastructure project will increase the quality of life for the citizens of Salina by providing the services needed to develop the subdivision. RECOMMENDED ACTION: It is recommended that the City Commission approve Resolution No. 07-6395 of advisability and authorization establishing the special assessment improvement district and authorize staff to set the bid date for the project. cc: Kelly Dunn Stan Byquist James Markle Ó¿¹²±´·¿Ø·´´­Û­¬¿¬»­ß¼¼·¬·±²ô и¿­»î Þ´±½µï ë ï î é ï ð ï ï ê ç è ì η¼¹»¸·´´Ü®·ª» í ë ê î ì í ï î Þ´±½µî ç è é ï í ï î ï ï ð ï ï ͬ±²»°±­¬Ô¿²» ï ç í ì ê ë é î и¿­»î Þ»²»º·¬Ü·­¬®·½¬ Þ´±½µí è ç ï ì ï í è ï ð ï î ï ï é Õ¿­§²Ô¿²» ê ï î ï ï ï î í ë ï ð ï í Þ´±½µé ì ì ç ë ê ï ì í Ü«²²©±±¼Ü®·ª» ï ë è î É¿¬»® î í î ì î ë é ï ê ï Í¿²·¬¿®§ Í»©»® î î î ï ï é ê ï ë î ð ì î ï ç í é í ì ê ï è î è ï é ë ï ç ï ê ï ð ï ë Þ´±½µê ï í ï î ï ì ï ï ˲°´¿¬¬»¼Ì®¿½¬Ò±ò ï ñ