Apartment, condominium and commercial development is generating hundreds of thousands of dollars for parks in some booming Minneapolis neighborhoods.

The total amount collected has topped $1.7 million since the park dedication fee was imposed in 2014. Developers pay the fee based on number of housing units or employees their project will contain, and the money is earmarked for park improvements in those neighborhoods or nearby.

The winners so far are downtown neighborhoods and some along Lake Street — where lots of Minneapolis’ biggest developments are going up. The Cedar-Isles-Dean neighborhood on the city’s west edge stands to benefit the most, with $373,500 collected to date.

But some neighborhoods have collected little or nothing and may have to wait years to gather enough money for improvements.

The Cedar-Isles-Dean money could potentially be used for a new trail between Lake Calhoun and Lake of the Isles, or for a marker at a small park to commemorate a former school, according to Craig Westgate, chairman of the neighborhood group.

“The thing we don’t know is what say we’ll get,” Westgate said.

That’s because the money is controlled by the Minneapolis Park and Recreation Board. In some cases, neighborhoods will play an advisory role, according to Adam Arvidson, the Park Board’s director of strategic planning. But the main factors governing use of the fee will be conforming to limits set by the fee ordinance and to park master plans.

Adding parks

It took six years of lobbying to establish the fee in Minneapolis. Many suburbs and St. Paul have long had such park dedication fees, meant to help pay for park or trail facilities needed to serve the new residents or workers who come with new development. In its first two years collecting park dedication fees, Minneapolis has brought in six times as much St. Paul in the same period.

The fee must be used to upgrade the park, not for routine maintenance or replacement of equipment, Arvidson said.

The law requires that the money be spent within the neighborhood where the fee was collected. But if that’s not feasible, it may be spent on a park or trail that’s in an abutting neighborhood but within half a mile of the development site.

Bancroft neighborhood on the South Side is one of several that have no parks within their borders on which to spend money. But $4,563 has been collected from a commercial development in a corner of the neighborhood. Barring the creation of a new park in the neighborhood, the money may go to Phelps Park, just across Chicago Avenue.

Despite six-figure fee collections in five neighborhoods, the median amount collected for city neighborhoods was just over $3,000. Twenty-eight neighborhoods lacked eligible development and collected no park dedication fees. Many of those were residential neighborhoods between Minnehaha Creek and Crosstown Highway. Such neighborhoods likely won’t accumulate enough money for park improvements for 10 or 20 years, park Superintendent Jayne Miller said.

Top recipients

The busiest neighborhood for fee payments was Hawthorne, but its seven projects were small-scale and generated only $10,263. In contrast, two large apartment complexes generated $373,500 for the Cedar-Isles-Dean area. One development, Trammell Crow’s 164-unit project on Lake Street yielded the top fee in the city at $235,500.

Another neighborhood that’s accumulating park fees rapidly is North Loop, where three projects have paid $214,391. Neighborhood group President David Frank said that at the rate the group reviews new proposals, “that number will go up quickly.” Such growth has fueled Park Board efforts to find potential park sites away from the riverfront, including possibly converting a parking lot into green space.

Arvidson said the Park Board is trying to be scrupulous in meeting the requirement that the fee be used to add to already scheduled projects. For example, in the Seward neighborhood, some $12,900 from the fee is being added to a previously scheduled $197,500 playground project to provided additional features beyond a standard playground replacement.

The park system this week debuted an interactive online tool that allows users to track use of each collected fee.

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