Memorandum

City of Lawrence

 

TO:

Tom Markus, City Manager

FROM:

Charles Soules, Director of Public Works

DATE:

8/21/2018

RE:

Queens Road Public Hearing Date Resolution

 

Background

Queens Road north of 6th Street is classified as a collector street connecting at the most northern end to N1800 Road (aka Farmer’s Turnpike).  With over a decade of development in the area, this street needs to be improved to City standards.

 

New subdivisions and multi-dwelling unit projects rarely create enough demand by themselves to require building all of the streets in the street network necessary to support them as a new area of the city urbanizes.  Therefore, new developments are often required only to build the streets minimally necessary to provide access, but with the understanding that the development will need to contribute to the greater street network as developments accumulate and greater demand is placed on the surrounding network. 

 

To address this, the city requires new subdivisions to be served, at the developer’s expense per the city’s development policy, with a planned street network that may be a temporary solution until the ultimate planned street network can be financed and constructed.  Direct access to the identified streets is not made for every new lot and may not be made for any new lot based on access management standards, but the new lots in an area will use all of the street network over time, and thus are responsible for paying the cost of both the temporary and ultimate planned street network.

 

When enough development in an area triggers the need to complete the street network, those streets can be constructed with benefit district financing (special assessments) and all developments approved over time then contribute to completing the street network.  For certain major streets, the city at large pays for extra amenities such as recreation path, bicycle amenities, etc.

 

Much of Lawrence has developed in this fashion given the history of developing new areas in smaller pieces compared to the development practices of some other cities. In this sense, Queens Road is not unique.  Development in the vicinity of Queens Road and along the related road network has persisted and now the demand is very high to complete the construction of Queens Road.  Queens Road is necessary to complete the street network in this area to offer alternative transportation routes to properties in the area, as well as improve emergency vehicle assess to properties in the area. 

 

Kansas Law on Benefit Districts

Benefit districts are a common and legal option for cities/developers to provide infrastructure to an urbanizing area.  Below is a brief summary of certain legal considerations involved in the governing body’s creation of a benefit district.

·         The statute (KSA 12-6a01 et seq.) defines “improvement district” as “an area deemed by the governing body to be benefitted by an improvement and subject to special assessment for all or a portion of the cost of the improvement.”  (KSA 12-6a01(f))

 

·         A governing body is vested with broad discretion in establishing an improvement district, and its determination is not subject to review in the absence of showing fraudulent or arbitrary conduct.  (Giddings v. City of Pittsburg, 421 P.2d 181)

 

·         Assessments must impose a substantially equal burden of the costs of the improvement upon property within the improvement district that is similarly benefitted (KSA 12-6a08(a))

 

·         If property that does not abut a proposed street improvement is included in the benefit district, then property abutting such improvement must be included in the district (Kansas Attorney General Opinion No. 2000-13)

 

·         Property situated similarly to other properties that are included in the improvement district must be deemed benefitted (Kansas Attorney General Opinion No. 2000-13)

 

·         Current use of the land may not be considered when determining whether a particular property benefits from an improvement.  Property must be included in an improvement district when the land is benefitted for any purpose.  (Board of Ed. of USD 345 v. City of Topeka, 522 P.2d 982)

 

While Lawrence has a long history of using this financing mechanism for building infrastructure, the following specific areas are more recent examples of using special benefit district financing:

 

1.       O’Connell Road – from 23rd south to 27th Street

2.       George Williams Way – north and south of 6th Street

3.       Stoneridge Drive – north and south of 6th

4.       Folks Road south of 6th Street

5.       Overland drive

6.       6th & Congressional intersection

7.       Yankee Tank Estates (Kasold on the curve)

 

The Proposed Benefit Districts/Options for Commission Consideration

There are two benefit districts being considered. One benefit district will finance a portion of the improvements to Queens Road from 6th Street to Eisenhower Drive, and the other will finance the intersection and signalization improvements at 6th Street and Queens Road.

 

Three Options are presented for the Commission’s consideration.  The improvements, method of assessment, and estimated cost for construction are the same for all three options.  The difference among the three options is the area included within the benefit districts and the allocation of costs between the City at large and the benefit district.  The general project summary is:

 

Project Summary

QUEENS ROAD

SIGNALIZATION OF 6TH STREET

Project Description

Construction of Queens Road from 6th Street to Eisenhower Drive

-        2-lane road with median and turn lane at intersecting streets

-        Roundabout at Overland Dr.

-        Bike lanes

Sidewalk and multi-use path

-        Signalization of intersection

-        Mast arms, signals

-        Controller box

-        Pedestrian crossing ADA ramps

-        Pre-emption and video detection equipment

Pavement markings

Estimated Cost

$4,830,760

$450,000

 

Method of Assessment

Equally per square footage

Equally per square footage

Apportionment of Costs

Option #1:

100% of costs assessed to Benefit District except City will pay for additional street width for bike lanes (estimate $226,000) and additional width for multi-use path (estimate $122,250), for a total City contribution of approximately $348,250.  Benefit District share is approximately $4,485,510.

 

Option #2:

City will pay for additional street width for bike lanes (estimate $226,000) and additional width for multi-use path (estimate $122,250), plus an additional $325,700 of project costs, for a total City contribution of approximately $673,950.  Benefit District will pay 100% of the remaining cost of the Improvements, or approximately $4,156,810.

 

 

 

 

Option #3:

City contribution of $673,950.00

Option #1:

100% Benefit District ($450,000),

0% City at Large.

 

 

 

 

 

 

Option #2:

City will pay $30,000 for the costs of the Improvements.  Benefit District will pay 100% of the remaining cost of the Improvements, or approximately $420,000.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Option #3:

City will pay $30,000 for the cost of the improvements.

 

 

OPTION #1

This option was presented to the City Commission on May 1, 2018.  The proposed benefit district area is attached (Option 1). 

 

OPTION #2

This option expands the benefit district area as suggested by the City Commission on May 1, 2018.  The proposed benefit district area is attached (Option 2).

 

Option 2 nearly doubled (47%) the square footage of the benefit district as compared to Option 1, thus the assessments to properties in Option 1 decreased by this percentage, as additional properties are now included.

 

The City is an owner of property within the proposed Option 2 benefit district boundaries.  The City owns the property at Overland and Wakarusa where the police facility is being located and the property on Stoneridge Drive where a water tower is located.  As a property owner, the City would be assessed as any other property owner in the district.  Based on a square footage assessment, the estimated cost to the City under Option 2 would be:

 

 

Queens Road

Intersection 6th And Queens

Water Tower

$33,262.00

$3,000.00

Overland and Wakarusa/Police Facility

$292,429.00

$27,000.00

 

The City’s total participation/cost, including the cost for bike lanes and shared use path ($348,250.00), would be approximately $704,000.00 for both benefit districts.

 

 

OPTION #3

A third option for the City Commission to consider would be for the City to contribute $704,000.00 (from Option 2 that would be the City’s costs for the property at Overland and Wakarusa, the Water Tower, the bike lanes and multi-use path) to project costs, but only levy assessments over the Option 1 benefit district area.  This option would reduce the per square foot assessments to properties as compared to Option 1, but would not expand the area over which assessment are levied. 

 

SUMMARY OF OPTIONS 1, 2 AND 3

Following is a summary of estimated total assessment amounts which will be levied over a term of 10 years for certain properties:

 

 

Option 1

Option 2

Option 3

Links

$1,386,449.00

$727,845.00

$1,286,085.00

Hunters’ Ridge

$344,880.00

$353,031.00

$294,208.00

St. Margaret’s

0

$93,163.00

0

Walmart

0

$160,888.00

0

USD 497

0

$186,136.00

0

Graycliff Holdings (10 acres)

$182,810.00

$100,048.00

$169,576.00

Block 2, Lot 15, Parkwest

$3,424.00

$1805.00

$3176.00

Westwood Hills 3rd

Block 1, Lot 32

$4,301.00

$2,238.00

$3,883.00

Oregon Trail, Block 1, Lot 3

0

$2,264.00

0

Westwood Hills, Block 2, Lot 10

0

$2,709.00

0

City

(includes assessments and city at large share)

$348,250.00 (bike/path)

$704,000.00

$704,000.00