FAQs

The Task Force believes a change to street funding is necessary and has recommended two options:

Option 1:  Half (or 50%) of the street reconstruction paid for by special assessments and the other half (or 50%) paid for with city taxes 

Option 2: All (or 100%) of the street reconstruction paid for with city taxes

 If the City Council approves a change, the task force recommends the preferred option be phased in over a period of 16 years. The 16 years represents a transition period during which the costs each year gradually move from the current 100% assessment policy to the new option. To make the special assessments more equitable, the task force also recommends for each option that the cost of any “subcuts” be removed from special assessments beginning in Year 1 of the transition period and be paid for with new city taxes.

Before the City Council takes action on the recommendations, each of which have city tax impacts, the task force urges residents to review and comment on the proposals. Comments and questions are being collected on this page through Tuesday, Jan. 19.

Currently, special assessments for street reconstruction in Edina can vary by up to 28 percent because of the soils underneath the existing street. 

Most local streets are built with 4 inches of bituminous or asphalt pavement and 8 inches of gravel. The soils needed to support those 12 inches vary greatly by location. The material underneath the 12 inches is called “subbase” and when it needs to be removed, it is called “subcut.” 

When the material has a lot of sand or gravel, no or little subcut is required. When the material is wet or includes a lot of clay, a large subcut can be required.

The task force has come to understand that:

1. The current method of street assessment is both fair and unfair at the same time.
   • It is fair in that all residents are subject to the same rules.
   • It is unfair in that a resident may pay significantly more or less based solely on the location of their property due to sub-soil quality (“subcut”) and the need for retaining wall reconstruction on City owned boulevard. 
   • It is unfair that some people will live 30 or more years in Edina and never experience a special assessment.
   • It is unfair that some people will experience more than one special assessment.
2. Edina’s current method of allocating 100% of street reconstruction costs as special assessments is an outlier among the Twin Cities metro communities.
3. Any change to the current system will be unfair to those residents who still reside in Edina and have previously experienced a special assessment. While as individuals on this task force we all have separate feelings on how we feel on tax increases vs assessments; we are interested in hearing from our council/ mayor and then our residents as to how they view these proposals. 

Edina’s current method of allocating 100% of street reconstruction costs as special assessments is an outlier among the Twin Cities metro communities. Neighboring communities use a combination of special assessments, city taxes, or franchise fees to pay for street reconstruction. It ranges from a fixed amount to a percentage for those that use special assessments.

We had multiple discussion with the City attorney. There is no legal way to refund or adjust the tax levy for residents recently assessed. The transition period is a way to gradually make the change while considering those previously assessed.

No. Both options provide the anticipated funding to continue at our current pace for local streets. Our Municipal State Aid streets are funded differently and are currently underfunded. All the estimates are just that, estimates. Inflation and future costs could change dramatically from our economic assumptions. In that case, changes to the funding would have to be made.

The economic analysis assumes a 3% inflation rate.

The assessable portion of the MSA assessment policy would most likely be changed in the same manner as the local assessment policy. The task force will be reviewing that portion of the policy before making recommendations to the City Council.

The estimated increase in city taxes, on a $551,000 median-value house, will be $37.90 in Year 1. Starting in Year 2 (the first year of the transition period to the new option) and continuing each year of the transition, the estimated increase in city taxes will be $$4.01 for Option1 and $9.49 for Option 2. By way of comparison, street special assessments have typically ranged from $7,000 to $15,000 per single family home.

The Engineering Department develops a 5-yr plan for street reconstruction. That plan is updated every year based on street condition, underground utility needs and transportation needs. The neighborhoods with the most needs are scheduled earlier in the 5-year plan. The 5-year plan map can be found in the document section or at this link https://experience.arcgis.com/experience/16c287e067034e5ea4410d7dec20a538

The median family home is currently valued at $551,300. In 2020, the median value home pays about $131 per month in city property taxes to fund all city provided services. The total estimated market value of the city is increasing by about 3.7% for taxes payable in 2021. With the recently approved a 5.95% increase to the property tax levy, the median family home would see about a 3.7% increase in city property taxes or about $4.75 per month. A significant portion of that increase includes funding for employee compensation and collective bargaining contracts.

The city is finding that the application of that policy is legally difficult. The policy is based on State Statue Chapter 429 that gives cities the ability to assess for public improvements. In order to do so, the assessed properties need to see a benefit in their property values equal to or greater than the assessment. Historical, in most cases, the benefit test has been met. We are seeing future neighborhoods where this would not be the case. If the city assesses more than the market benefit it could lead to expensive litigation for the city and residents. In that case, both parties lose. The task force has determined that the current policy is not financially and legally sustainable.