HomeMy WebLinkAboutItem 4aI:\CC Drafts\Work Session Agenda & Materials\1.docx
Memorandum
To: Mayor and City Council
Justin Miller, City Administrator
From: John Hennen, Parks & Recreation Director
Jerilyn Erickson, Finance Director
Date: November 20, 2018
Subject: Park Bond Referendum
BACKGROUND
At the June 25th City Council Work Session, the Mayor and City Council discussed a potential
Park Bond Referendum timeline and tax impact analysis to cover costs associated with the
expansion of Antlers Park, the development of Avonlea Community Playfield, East Community
Park Phase II and the construction of a sports dome.
As the Mayor and City Council are aware, Staff worked with a consultant last year developing a
Master Plan and cost estimates for Antlers Park. Master Plans and cost estimates have also
recently been completed for Avonlea Community Playfield and East Community Park Phase II.
ESTIMATED PROJECT COSTS
The updated estimated costs in today’s dollars to construct these three major park projects
along with the construction of a sports dome facility at Hasse Arena and improvements to
Ames Arena and parking lot are as follows:
1.Antlers Park Construction $7.5 million
2.Avonlea Community Park
a.Concept A (Includes a dome) $17,600,000
b.Concept B-1 (without a dome) $11,900,000
3.East Community Park $2,000,000
4.Dome Facility at Hasse Arena $5,000,000
5.Improvements to Ames Arena $6,900,000
I:\CC Drafts\Work Session Agenda & Materials\1.docx
FINANCIAL IMPACT
The following scenarios reflect various combinations of parks projects:
1. Antlers/Avonlea without dome ($19,400,000)
2. Antlers/Avonlea without dome/East ($21,400,000)
3. Antlers/Avonlea without dome/Hasse dome ($24,400,000)
4. Antlers/Avonlea with dome ($25,100,000)
5. Antlers/Avonlea without dome/East/Hasse dome ($26,400,000)
6. Antlers/Avonlea with dome/East ($27,100,000)
7. Antlers/Avonlea without dome/Hasse dome/Ames improvements ($31,300,000)
8. Antlers/Avonlea without dome/East/Hasse dome/Ames improvements ($33,300,000)
Exhibit "A" shows the estimated financial impact of each of the above scenarios on residential
homesteaded properties valued from $200,000 to $1,000,000 including the median valued
home ($307,400 for payable 2019). Also shown is the estimated impact on
commercial/industrial properties valued between $500,000 and $10,000,000. The
calculations were prepared by Springsted, Inc.
Realistically, the projects would not be completed all at the same time but rather over the
course of 3-5 years or a period of time determined by the Council. Per bond counsel, Dorsey
& Whitney, the City could issue bonds multiple times using the same authority from the voter
referendum.
The numbers shown above do not reflect other funding sources such as Park Dedication
Funds, school district, athletic organizations, etc. As part of the "Engage Interest Groups" task
below, the City would want to seek "preliminary approving resolutions" from the school
district, letters of intent from athletic organizations, etc. in advance of the referendum so this
commitment could be included in the "facts" of the referendum.
TIMELINE SCENARIOS FOR BOND REFERENDUM
Special Elections (Park Bond Referendum) can be held on the second Tuesday in February,
April, May and August and the first Tuesday after the first Monday in November. The following
are three Special Election dates scenarios:
I:\CC Drafts\Work Session Agenda & Materials\1.docx
Scenario #1 – May 14, 2019
Special Election
Scenario #2 – August 13,
2019 Special Election
Scenario #3 – November 5,
2019 Special Election
July – Dec
2018
Master planning
process for East
and Avonlea
Community Parks
July – Dec
2018
Master
planning
process for East
and Avonlea
Community
Parks
July – Dec
2018
Master planning
process for East
and Avonlea
Community Parks
Oct – Dec
2018
Engage interest
groups Oct 2018 –
Jan 2019
Engage interest
groups Nov 2018 –
March 2019
Engage interest
groups
Jan –
March
2019
Educate public on
Bond Referendum Feb – Aug
2019
Educate public
on Bond
Referendum
Feb – Oct
2019
Educate public on
Bond Referendum
Feb 19,
2019
City Council
considers
resolution calling
for Special Election
March 18,
2019
City Council
considers
resolution
calling for
Special Election
April 15,
2019
City Council
considers
resolution calling
No later
than
February
28, 2019
*City Clerk
provides written
notice to (1)
County Auditor
and (2) Secretary
of State regarding
election
No later
than May
30, 2019
*City Clerk
provides written
notice to (1)
County Auditor
and (2) Secretary
of State
regarding
election
No later
than
August 22,
2019
*City Clerk
provides written
notice to (1)
County Auditor
and (2) Secretary
of State regarding
election
May 14,
2019
Special Election for
Park Bond
Referendum
August
13, 2019
Special Election
for Park Bond
Referendum
November
5, 2019
Special Election
for Park Bond
Referendum
June – Nov
2019
If referendum
approved,
completion of
plans and
specifications
Sept – Dec
2019
If referendum
approved,
completion of
plans and
specifications
Nov 2019 –
April 2020
If referendum
approved,
completion of
plans and
specifications
Dec 2019 Bid opening Jan – Feb
2020
Bid opening May 2020 Bid opening
Spring
2020
Construction
commences Spring
2020
Construction
commences Summer
2020
Construction
commences
*At least 74 days before election, written notice must be provided from (1) City Clerk to County Auditor (2) County Auditor to Secretary of
State.
I:\CC Drafts\Work Session Agenda & Materials\1.docx
ADDITIONAL CONSIDERATIONS
If the City were to lease the dome to a private company to run the operations, this would
impact the tax-exempt status of the bonds. Bond counsel would need to review the
alternatives available.
If the City Council elects to move forward with a Park Bond Referendum, Staff recommends
working with Springsted Inc. to complete a phone survey which would provide the City
Council with valuable data regarding what residents are willing to pay in increased yearly
property taxes for park projects. The information then can be used to determine the total
amount of the Park Bond Referendum that the Council is comfortable in setting.
Attached are draft survey questions regarding the park projects provided by Springsted Inc.
that the Mayor and City Council can consider if the decision is to move forward with a Park
Bond Referendum.
COUNCIL DIRECTION
Staff is seeking direction from the Mayor and City Council on:
• Moving forward with plans for a May 2019 referendum along with which projects to
include in the referendum
• If the direction is to proceed with plans to construct a dome facility at the Hasse
Arena site, direct staff to commence formal discussions with ISD 194 regarding land
transfer
• Moving forward with Springsted Inc. to conduct on phone survey
City of Lakeville, Minnesota
General Obligation Bonds, Series 2020
Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 Scenario 6 Scenario 7 Scenario 8
Par Amount $19,640,000 $21,655,000 $24,685,000 $25,400,000 $26,715,000 $27,420,000 $31,660,000 $33,675,000
Estimated Pay 21 (c)$1,527,323 $1,687,130 $1,922,008 $1,975,278 $2,082,474 $2,135,376 $2,463,021 $2,622,962
Property Market NTC $75,422,344 $75,422,344 $75,422,344 $75,422,344 $75,422,344 $75,422,344 $75,422,344 $75,422,344
Type Value (a)Est. Tax Rate (b):2.025%2.237%2.548%2.619%2.761%2.831%3.266%3.478%
Residential 200,000 37 40 46 47 50 51 59 63
Homestead 225,000 42 47 53 54 57 59 68 72
250,000 48 53 60 62 65 67 77 82
275,000 53 59 67 69 72 74 86 91
300,000 59 65 74 76 80 82 95 101
307,400 60 67 76 78 82 84 97 104
500,000 101 112 127 131 138 142 163 174
750,000 165 182 207 213 224 230 265 283
1,000,000 228 252 287 295 311 319 367 391
Commercial/500,000 187 207 236 242 255 262 302 322
Industrial 1,000,000 390 431 491 504 532 545 629 669
3,000,000 1,200 1,325 1,510 1,552 1,636 1,678 1,935 2,061
5,000,000 2,010 2,220 2,529 2,599 2,740 2,810 3,241 3,452
7,000,000 2,820 3,115 3,549 3,647 3,845 3,942 4,547 4,843
10,000,000 4,035 4,457 5,078 5,218 5,501 5,641 6,507 6,929
(a) Estimated market value is the assessed value, the basis for how each property's taxable market value is calculated.
(b) The tax rate increase is derived by dividing the required amount levied for debt service by total net tax capacity for all properties in the City.
(c) Given level debt service, pay 21 amount is roughly equal to the 105% debt service amount for each subsequent year until maturity
Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 Scenario 6 Scenario 7 Scenario 8
Par Amount*$19,640,000 $21,655,000 $24,685,000 $25,400,000 $26,715,000 $27,420,000 $31,660,000 $33,675,000
True Interest Cost (TIC)*4.2133014%4.2130744%4.2130241%4.2133130%4.2131589%4.2132588%4.2131351%4.2132463%
Assumptions Used:Financial Impact Scenarios:
Current Aa1 MN GO Rates plus 75 basis points for market movement Scenario 1. Antlers/Avonlea without dome ($19,400,000)
20 year amortization Scenario 2. Antlers/Avonlea without dome/East ($21,400,000)
Level Debt Service Scenario 3. Antlers/Avonlea without dome/Hasse dome ($24,400,000)
Standard costs of issuance Scenario 4. Antlers/Avonlea with dome ($25,100,000)
Dated March 1, 2020 Scenario 5. Antlers/Avonlea without dome/East/Hasse dome ($26,400,000)
First Principal and Interest payment February 1, 2021 Scenario 6. Antlers/Avonlea with dome/East ($27,100,000)
Scenario 7. Antlers/Avonlea without dome/Hasse dome/Ames improvements ($31,300,000)
Scenario 8. Antlers/Avonlea without dome/East/Hasse dome/Ames improvements ($33,300,000)
*Values are estimates and are subject to change
Tuesday, November 20, 2018
True Interest Cost (TIC) is the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the bonds. This rate factors in all costs of
issuance and considers the time value of money. TIC is currently the market standard in evaluating the cost of borrowing.
EXHIBIT A
City of Lakeville – Parks
Community Survey
Version 3 – November 15, 2018
Page 1
Hello. I’m calling on behalf of the City of Lakeville, to ask local residents for their reaction to some
projects being considered by the Parks and Recreation Department. This survey will take
approximately __ minutes, and your answers to the questions are very important. All of your answers
will be strictly confidential. May I please speak with (NAME FROM LIST)?
IF NEEDED AT INTRODUCTION: This is a survey about parks and recreation in Lakeville. I am not trying
to sell anything.
IF NEEDED AT INTRODUCTION: If now is not a convenient time, can you let me know a better time so I
can call back?
IF NEEDED AT INTRODUCTION BECAUSE THE PERSON ASKS WHY YOU NEED TO SPEAK TO THE LISTED
PERSON, OR IF THEY ASK TO PARTICIPATE INSTEAD: For statistical purposes, this survey can only be
completed by this particular person.
If you are driving a car or doing any activity requiring your full attention right now, I need to call you
back later. The first question is:
Q1: Are you registered to vote at [ADDRESS]?
1. Yes (GOTO Q2)
2. No (TERMINATE)
3. DK/REFUSED (TERMINATE)
Q2: In the past 12 months, roughly how many times have you used the city’s parks and recreation
amenities? (record integer value) ____
If Q2 = Zero, (GOTO Q4)
If Q2 > Zero, (GOTO Q3)
If Q2 = DK/REFUSED, (TERMINATE)
Q3: What kind of parks and recreation amenities do you use most often? (OPEN)
Q4: What is one thing you would add or change about the City’s parks and recreation amenities?
(OPEN)
City of Lakeville – Parks
Community Survey
Version 3 – November 15, 2018
Page 2
The City of Lakeville is considering some projects that would add to or expand the city’s recreation
facilities, and the City is interested in hearing whether residents would support these projects. I’m
going to describe some of these projects, and I’d like you to share your opinions about them.
Antlers Park was built on the shores of Lake Marion in the 1970s. The City is considering a number of
improvements and renovations to the park. As I describe some of the projects that are being
considered, I’d like you to tell me if each one makes you more likely or less likely to support the
project. (RANDOM ORDER Q5-Q13)
More
likely
Less
likely
No
difference
Don’t
know/
refused
Q5: Add a fountain with a play areas where kids can
splash around. 1 2 3 4
Q6: Build new picnic shelters. 1 2 3 4
Q7: Build a children’s playground with seating for
parents. 1 2 3 4
Q8: Install sun shades along the beach area. 1 2 3 4
Q9: Construct a new building with restrooms and
changing rooms. 1 2 3 4
Q10: Construct a new building with a snack bar and
a meeting room. 1 2 3 4
Q11: Install a community fire pit with patio seating. 1 2 3 4
Q12: Expand the parking area and improve the
driveway entrance. 1 2 3 4
Q13: Add walking and biking trails connected to the
regional trail system. 1 2 3 4
The Hasse (pr: “Hossey”) Ice Arena is on County 70 near Holyoke Avenue. The city is considering
construction of a sports dome on the north side of the arena, which would be inflated six months out
of the year, giving local schools and athletic groups an indoor facility for practices and games during
the cold-weather months. The artificial turf would also be available as an outdoor field in the months
when the dome isn’t used.
Support Oppose Don’t know/
refused
Q14: Would you oppose or support building a sports
dome next to the Hasse Ice Arena? 1 2 3
City of Lakeville – Parks
Community Survey
Version 3 – November 15, 2018
Page 3
The City owns around 40 acres of parkland west of Cedar Avenue, about a mile south of Dodd Road,
and is thinking about building a community park at this location. As I describe some of the
improvements being considered, I’d like you to tell me if each one makes you more likely or less likely
to support the project. (RANDOM ORDER Q15-Q20)
More
likely
Less
likely
No
difference
Don’t
know/
refused
Q15: Install four grass fields that could be used for
football, soccer, lacrosse and other sports. These
would also have lighting for games and practices
after sunset.
1 2 3 4
Q16: Build a lighted baseball field with dugouts and
grandstand seating. 1 2 3 4
Q17: Build a large playground area. 1 2 3 4
Q18: Build an outdoor fitness area and challenge
course. 1 2 3 4
Q19: Construct a park building with restrooms,
storage, and community meeting space. 1 2 3 4
Q20: Add walking and biking trails connected to the
regional trail system. 1 2 3 4
The City could also build a sports dome at this location, instead of Hasse Arena. Like the other one, this
would be inflated six months a year, and the artificial turf would be available as an outdoor field when
the dome isn’t used.
Q21: Given the possibility of building a dome at Hasse Arena, or at the new park near Cedar and
Dodd, which option would you prefer?
1. Build a dome at Hasse Arena
2. Build a dome at Cedar and Dodd
3. Build a dome at either location
4. Don’t build a dome at either location
5. Don’t know/refused
City of Lakeville – Parks
Community Survey
Version 3 – November 15, 2018
Page 4
East Lake Community Park is on Pilot Knob Road, just north of 170th Street. The City is thinking of
expanding the park and adding a number of new amenities to it. As I describe some of the
improvements being considered, I’d like you to tell me if each one makes you more likely or less likely
to support the project. (RANDOM ORDER Q22-Q28)
More
likely
Less
likely
No
difference
Don’t
know/
refused
Q22: Expand the park’s walking and biking trails. 1 2 3 4
Q23: Add a trailhead for the North Creek trail
system, with a picnic shelter, restrooms, water
fountains and a bike repair station.
1 2 3 4
Q24: Convert some land to native prairie grasses
and wildflowers. 1 2 3 4
Q25: Add docks and storage racks for canoes and
kayaks at the lake. 1 2 3 4
Q26: Add a fishing pier on the lake. 1 2 3 4
Q27: Build a parking area for 40 cars. 1 2 3 4
Q28: Create an open lawn area where people can
play lacrosse and soccer. 1 2 3 4
City of Lakeville – Parks
Community Survey
Version 3 – November 15, 2018
Page 5
The Lakeville Ames Arena has two ice rinks that were built in the 1990s. The building and mechanical
systems are reaching the end of their expected lifespans, and need significant attention. As I describe
some of the improvements that are being considered, I’d like you to tell me if each one makes you
more likely or less likely to support the project. (RANDOM ORDER Q29-Q33)
More
likely
Less
likely
No
difference
Don’t
know/
refused
Q29: Replace the ice-making system with new
equipment that does not require Freon, which is
being phased out of production.
1 2 3 4
Q30: Replace the floors and piping under the two
ice rinks. 1 2 3 4
Q31: Replace the roof at the facility. 1 2 3 4
Q32: Replace the dehumidifier systems for both ice
sheets. 1 2 3 4
Q33: Replace the dasher boards around each ice
sheet. 1 2 3 4
I am going to ask you some questions about potential costs to make the improvements we’ve been
talking about. These costs will be read to you in random order. For each one, please tell me if the cost
would make you favor or oppose the improvements. (ROTATE ORDER)
Favor Oppose UNDECIDED REFUSED
Q34: Property taxes will increase by $50 per year
for an average home valued at $300,000. 1 2 3 4
Q35: Property taxes will increase by $75 per year
for an average home valued at $300,000. 1 2 3 4
Q36: Property taxes will increase by $100 per year
for an average home valued at $300,000. 1 2 3 4
City of Lakeville – Parks
Community Survey
Version 3 – November 15, 2018
Page 6
Q37: The Parks and Recreation Department charges fees to help cover the costs of recreation
programs and events. Do you think these fees are much too high, somewhat high, about right,
somewhat low, or much too low?
1. Much too high
2. Somewhat high
3. About right
4. Somewhat low
5. Much too low
6. DK/REFUSE
Q38: How well informed do you feel about the City’s recreation programs and events?
1. Very well informed
2. Somewhat well informed
3. Not well informed at all (GOTO Q40)
4. DK/REFUSE
Q39: Where do you get most of your information about the City’s parks and recreation programs?
1. Printed catalogs and brochures from the City
2. Parks and Recreation web site
3. Friends and neighbors
4. Athletic associations
5. Local newspaper
6. Other:
7. DK/REFUSE
Q40: Please tell me if you strongly agree, agree, disagree, or strongly disagree with the following
statement: parks and recreation facilities are an important contributor to the quality of life in
Lakeville.
1. Strongly agree
2. Agree
3. Disagree
4. Strongly disagree
5. DK/REFUSE
Thank you for your time.
RECORD GENDER
1. Male
2. Female