People inheriting and subdividing property in Ham Lake may not have to pay traditional development fees if they do not plan to improve their land in the near future.
The Ham Lake City Council unanimously passed a new ordinance in late March that would enable it to have some discretion in determining what fees would be paid depending on what the applicant is actually seeking to do.
For example, children may inherit property from a parent after they die. They may want to divide the property among themselves rather than have one large lot with multiple owners.
Under the old city ordinance, this family could certainly subdivide the land, but this action would trigger a number of fees and city requirements. The current council did not think this is fair considering the economic recession may make it difficult for the family to develop the property.
Whenever they choose to develop, however, the city could issue fees and requirements at that time.
“It makes sense,” Mayor Mike Van Kirk said. “The council as a whole is well-known as being pro land owner rights.”
According to the city’s website, a subdivision could result in a number of different fees depending on what the property owners wish to do. For example, a metes and bounds conveyance costs $500. They would have to pay $700 per lot or per unit if doing a sketch plan plat.
Ham Lake charges $3,000 per residential living unit for park dedication fees. The future drainage easement fund fee per residential unit is $200.
Those subdividing properties usually have to pay for the roads to be paved next to their property if the roads were gravel. This could also be deferred, according to the ordinance. However, if a subdivision results in a land-locked property, City Attorney Wilbur Dorn said the personal property owners would have to pay for at least a gravel road to get to the land-locked site. The ordinance requires each subdivided parcel to at least have 200 feet of frontage on a public road.
As far as Dorn knows, this kind of ordinance is unique. He did not copy any portions from other city ordinances. He created it from scratch.
City Administrator Doris Nivala said this issue came before the council because a family who recently inherited property brought it up. Councilmember Tom Johnson said sometimes circumstances that have never arisen before come up. The council, in this case, did not see a problem with leniency.
“It doesn’t make sense in a market when nobody can sell lots that you have to go through that exercise to get the estate settled,” Johnson said.
Not everyone will benefit from this ordinance. The property being given in an inheritance needed to be owned by an individual or an entity such as a family trust before the original owner died. Business corporations cannot benefit from this ordinance.
The property size before subdivision would have had to been at least five acres and the divided parcels must be approximately equal in value. No subdivided parcel may be less than 2.5 acres.
According to Dorn, this ordinance has a five-year sunset date clause. It would automatically go away as of July 2, 2017 unless the council at that time extends the time frame.
Dorn said hopefully by then people are wanting to develop their property.
Eric Hagen is at [email protected]