By Nancy Huddleston, Editor
Should the city be in the business of providing financing services to build a private park?
“No,” said members of the Savage City Council during a Monday night (Oct. 6) work session where a request for a park from the Ridgewood Homeowner’s Association was taken under consideration.
The homeowner’s association didn’t want the city to pay for the park; rather they wanted the city to finance the purchase and development of the last lot in the 252-unit townhome neighborhood. In turn, the homeowner’s association pledged to pay the city back by increasing annual association dues to cover the debt.
Ridgewood is located on South Park Drive, right next to the SuperTarget development on Highway 13. It was planned by Rottlund Development in 2000 and is nearing completion.
Michael Noonan, division president of Rottlund, told the City Council there is one remaining 12-unit townhome pad site at Ridgewood that could be used for the park.
He said Rottlund is not willing to enter into a financial agreement with the homeowner’s association to build the park, given the current housing climate and the company’s desire to finish up its involvement in the neighborhood.
That’s when the city was asked if it might be interested.
Councilman Al McColl said the City Council is a steward of the taxpayer’s money and the homeowners were asking the city to be their banker. “That’s something I can’t get right with,” he said, citing the city recently completed a financial process that put it on firm financial ground.
Mayor Janet Williams and Councilwoman Jane Victory were concerned about the precedent set by the City Council agreeing to finance a private park.
Victorey said that while the park adds value to the homeowner’s property, she felt there were other avenues they could use to fund the project – such as a private banker.
Councilwoman Christine Kelly said she loves partnerships, however, agreed with McColl. “I don’t know if I want the city getting into the banking business -- never mind the current economic state,” she said, “The more precarious thing here is setting the precedent.”
Councilman Gene Abbott said the deal initially sounded good, but after careful study, it “didn’t feel right,” from a resident’s standpoint.
City Administrator Barry Stock said the concept is innovative and would benefit the neighborhood. And, it’s not unique for residents to come to the city requesting help with a project in their neighborhood, as the city gets requests about drainage problems, park equipment, vandalism and road conditions on a daily basis.
“But this was unique as the homeowner’s association wanted a park and they wanted the city’s help with the financing,” he said. “They were willing to pay us back, so we looked into the opportunities available.”
From a dollars and cents standpoint, the cost to complete the park is estimated at $500,000 to purchase and develop the land, buy playground equipment and for staff time. The half-million dollar cost would be amortized over a 15-year period at an interest rate of 6.5 percent. Annual payments would have amounted to $52,266.
Funding could have come from the city’s park reserve fund, community investment fund or by selling lease revenue bonds.
When Ridgewood was developed, the city and Rottlund agreed to a park fee fund agreement and the fees were put towards the development of McCann Park, located just east of the townhomes on the corner of South Park Drive and Louisiana Avenue.
Nancy Huddleston can be reached at editor@savagepacer.com [2].
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