Minneapolis might assess developers land or money for parks

Minneapolis may finally join many other metro area cities in raising money for new and refurbished parks by charging developers fees that could be paid in land or money.

Charging a park dedication fee has been a goal of the Minneapolis Park and Recreation Board for years, but an ordinance to do just that is coming before the City Council today. Two senior council members, President Barb Johnson and budget Chairman Paul Ostrow, have indicated their strong support for the plan.

The proposal would make the park dedication ordinance effective only once an identical ordinance is passed by the Park Board. The Park Board earlier passed a different proposal. Approval of both bodies is required because they split parks and development responsibilities, unlike most cities.

"I see this as significant progress," said park Commissioner Scott Vreeland, who has engaged in council discussions on the proposal. Among the areas that could benefit from the money raised are the upper riverfront, areas by the University of Minnesota where a new parkway has been proposed, and the Hiawatha corridor. It could also produce money to refurbish neighborhood parks.

But there are divisions on the council on several key provisions of the park proposal that could lead to changes during the council debate today. Some council members want to exempt entire housing projects if they contain any units priced to be affordable to low-income people, arguing that since the city subsidizes part of their construction it would only be charging itself. The proposal as approved in committee only exempts a project's affordable units and not its market-rate units.

Another debate concerns how closely the use of money must be tied to the area of the development paying the fee. The proposal now prescribes use of the money in the same neighborhood as the development. If that's not practical, the money must be used within one-half mile of the development, but if that's not practical, up to 2 miles away. Some council members want to tighten those distances.

Downtown business representatives argued against the fee on the grounds that it would make the city uncompetitive with suburbs, many of which charge park dedication fees already. They also say the fee would be an additional burden atop the fees imposed on downtown properties earlier this year to operate a new special service district.

The park dedication fee could only be used to buy and develop parks, not to operate them. The Park Board also would have to have enough money to operate a new park before it could accept land donated to fulfill the parks fee.

The amount of land to be donated by a residential development depends on the number of units, with a smaller donation required downtown because of smaller household sizes. For business developments, the land donation would be based on the number of added employees. Developers could also retain land designated for park use, as long as it is open to the public. That could lead to more downtown plazas.

But the city could reject a land donation if it's not desirable, instead charging a fee based on the area and value of the parcel being developed. That would be capped at $2,000 per housing unit or $200 per employee. Close to 70 metro area communities, including St. Paul and Bloomington, already charge park dedication fees.