Cottage Grove changes street assessment policy; road projects back on track for 2013Cottage Grove will resume its annual program of residential road and utility maintenance after the City Council approved a series of tweaks to the city’s policy governing special assessments for infrastructure improvements.
Cottage Grove will resume its annual program of residential road and utility maintenance after the City Council approved a series of tweaks to the city’s policy governing special assessments for infrastructure improvements.
The council last week voted unanimously to accept changes to the street improvement policy first adopted in 1994 recommended by the city’s Infrastructure Management Task Force and Public Works Commission. In a separate measure, the council voted to begin planning for a 2013 road project.
Among the mostly minor amendments is a change in the interest rate tacked onto assessments levied against benefitting properties that are not paid up front. That was a point of complaint among homeowners who lobbied the city to postpone the maintenance projects last year.
Under the old policy, the city had charged residents seven percent interest on the assessments if financed over 15 years rather than paid in full at the outset. Now, the interest rate will float at whatever bond rate the city finances the project cost at, plus 1.5 percent.
Properties impacted by the road and utility improvements are assessed 45 percent of the project costs, under the policy; the general taxpayer picks up the remaining 55 percent.
The city had delayed planned residential road work in 2012 to reevaluate the infrastructure improvement policies after residents whose roads were due to be rehabbed circulated a petition asking to halt the project, with the interest rate a major point of contention.
City officials have said the 7 percent interest rate was put in place at a time when interest rates were much higher than currently; recent projects have been financed closer to 3 to 3.5 percent, City Administrator Ryan Schroeder.
The new, floating interest rates mean property owners could pay higher than the old 7 percent rate in the future, he said.
The change “doesn’t really make much of a financial impact,” Schroeder said. Around 35 percent of people pay their assessments up front, he said. For those who don’t, “the difference between a 5 percent and 7 percent [interest rate] is just a few dollars per month.”