The cost structure for the 2025 Pavement Management project is challenging but generally our policy is that homeowners are assessed up to 45% of the costs to reconstruct the street.”

Cottage Grove Assistant City Engineer Crystal Raleigh

Roads are infrastructure, and sometimes they pass through neighborhoods. With several city based road projects planned and in progress across South Washington County this year, the question is raised: how does each city determine special assessments and how do these compare with each other?
As to determining assessments, this is done according to set procedures and a general cost structure, split between municipality and residents. As to comparisons by city, read on.
Starting with city-based improvements in Cottage Grove, special assessments are governed by the Infrastructure Maintenance Task Force Special Assessment Policy For Public Improvements, made effective on September 30, 2005 and last revised October 31, 2023.
Among 2025 Cottage Grove road projects that are city based and subject to the above policy are a mill and overlay projects on Hardwood Avenue from 80th Street to 70th Street, as well as those for the Timber Ridge and Pine Arbor Neighborhoods north of 70th Street. Also included in 2025 city-based projects for Cottage Grove are a pavement management project in the Hidden Valley neighborhood as well as rehabilitation of 80th Street. An intersection improvement project for Keats Avenue and 80th Street is county based and subject to different funding.
The city’s Special Assessment Policy summary gives the mains details of the official city policy on special assessments for city-based projects, including information on non-street related assessments.
“Special Assessment Policy
Special assessments are a charge to properties for the cost of making a local improvement, or to collect certain charges that will benefit these properties. Cities may also use special assessments to recover the cost of service charges including, but not limited to:
• Partially finance street improvements including Pavement Management
• Weed elimination from streets and private property
• Removal or elimination of public health or safety hazards
• Unpaid sewer and water bills
Pavement Management Special Assessments
Cottage Grove's Pavement Management Program is partially funded through special assessments to adjoining properties. On a residential street, the residential buildable lot equivalent (RBLE) method is used to determine the assessment for the each property adjacent to a project. Under this method 45% of the total project cost is divided by the number of RBLE. This rate is then applied to each RBLE lot that benefits from the improvement. The City Engineer and Finance Director prepare the assessment roll based on that methodology.
The Finance Department administers the collection of special assessments.”
Cottage Grove residents with questions on their special assessment can call the City Finance Department at 651-458-2884, with utility bill assessments directed to the City's Utility Billing Customer Service Representative at 651-458-2831.
Statute based assessment deferments are covered in Section 7.1, as defined in 435.193 and 435.195 of the State Statutes and 1-5-3 of the city code. Deferments can be made for unimproved land as well, with interest accruing on such deferments.
As for cost structure, Cottage Grove Assistant City Engineer Crystal Raleigh went into more detail on how the city determines special assessments for pavement management projects.
“The cost structure for the 2025 Pavement Management project is challenging but generally our policy is that homeowners are assessed up to 45% of the costs to reconstruct the street,” she said. “Other City funding sources pay for utility improvements and park improvements on the project. We generally determine project costs and split the assessment equally among the parcels in the neighborhood. We also perform a special benefit appraisal to determine the value of the benefit of the street project to the property. Our assessment amount will never be higher than the special benefit appraisal.”
So much for Cottage Grove.
Moving to St. Paul Park, the Third Avenue Street Reconstruction is the Main Street project for 2025.
The assessment process for St. Paul Park street projects are guided by the Special Assessment and Trunk Area Policies and Procedures, as these pertain to public improvements. Made effective on June 18, 2007 and last amended November 2, 2015, the policy St. Paul Park opens with a general purpose statement.
“The purpose of this policy is to establish a fair and equitable manner of assessing the increase in market value (special benefit) associated with public improvements. The procedures used by the City of St. Paul Park (“City”) for levying special assessments are those specified by Minnesota Statutes, Chapter 429 which provides that all or a part of the cost of improvements may be assessed against benefiting properties.
Three basic criteria must be satisfied before a particular parcel can be assessed. The criteria are as follows:
• The land must have received special benefit from the improvement.
• The amount of the assessment must not exceed the special benefit.
• The assessment must be uniform in relation to the same class of property within the assessment area.
“It is important to recognize that the actual cost of extending an improvement past a particular parcel is not the controlling factor in determining the amount to be assessed. However, in most cases the method for assigning the value of the benefit received by the improvement, and therefore the amount to be assessed, shall be the cost of providing the improvement.
“This shall be true provided the cost does not demonstrably exceed the increase in the market value of the property being assessed. The entire project shall be considered as a whole for the purpose of calculating and computing an assessment rate. In the event City staff has doubt as to whether or not the costs of the project may exceed the special benefits to the property, the City Council may obtain such appraisals as may be necessary to support the proposed assessment.
“The assessment policy is intended to serve as a guide for a systematic assessment process in the City. There may be exceptions to the policy or unique circumstances or situations which may require special consideration and discretion by City staff and the City Council.”
Elaborating just what the above means in the next nine sections as well as where it applies, the policy stipulates assessment percentages for specific improvements, including sidewalks (100 percent), new streets (100 percent to benefitted area), reconstruction and overlays (33 percent), upgrading of existing gravel to asphalt (100 percent), alleys (100 percent), and seal coats (not assessed).
Also included in assessment policy are sewer and water mains.
As for the latter, the policy states that, “individual service lines installed directly to specified properties are fully assessed directly to the benefited properties. Properties that have existing sanitary services, but do not have mainline sewers adjacent, across or up to their property lines pay 50% of the assessment rate for the new mainline sanitary sewer as well as 100% of the cost associated with replacing the service lines.” A similar percentage based cost assessment holds for water mains as for sewers.
Watermain assessments for residential areas meanwhile are based on the construction of eight inch mains as the smallest size, while those for commercial and industrial areas are based on 12 inch mains.
Replacement of existing watermains is not assesed in St. Paul Park, while lateral benefit from major trunk water mains is assessed to properties benefitted by the watermain, according to the previously stated eight and 12 inch watermain parameters. The policy further states that “oversizing costs due to larger mains and larger appurtenance are paid for by a combination of availability charges, user charges and/or trunk area assessment charges,” with individual service lines installed directly to specified properties fully assessed to those properties.
General city policy for St. Paul Park is not to defer payment of special assessments, but that said a deferment application process does exist for those to whom payments would be a hardship. The policy is applicable to age (65 or older) and disability for homestead properties, as well as for active duty military, the last example pursuant to Section 190.05 of the State Statutes.
Deferments can also be applied for on special assessments for agricultural or unimproved land, with deadline for a deferment application on or before Oct. 31 for the year previous to that which for which deferral status is sought. Interest will continue to accumulate on deferred assessments, with applications for hardship deferment requiring supporting evidence—such is the policy in St. Paul Park.
From St. Paul Park then we come to Newport. With work earlier this year on 17th Street and Second Avenue and resolutions for road improvement hearings for 3rd Avenue and 12th Street on the Sept. 4 Newport Council agenda, Newport City Administrator Joe Hatch shared more on how street assessments work at Newport.
“The City’s Local Improvement Policy directs that a minimum of 20% of the total project cost is assessed to benefitting property owners for local street and utility improvements projects so long as the individual assessment amount does not exceed the benefit the improvement creates for the subject property,” he said. “For the 2025 Newport Street Reconstruction project, residents assessments will be lower than the policy and lower than the benefit appraisal conducted by the City. The benefit appraisal for the properties benefitting from the 2025 Street and Utility Improvements project during the planning stages of the project last fall. The appraisal determined that the individual property benefit ranged from $7,900 to $9,500 per unit. During the Improvement Hearing for the project, the City Council indicated that the anticipated assessment rate will be up to $9,000 per unit depending on the type of improvement received. Types of improvements include watermain and service lateral replacement, sanitary sewer and service lateral replacement, stormwater management and street improvements including concrete curb and driveway aprons. Based on preliminary information, we expect the total project cost for the 2025 Street and Utility Improvements project to be ~$4,700,000 and the total assessed amount is expected to be $394,000 (~9.4%). The assessment rates and total assessment amount will be finalized at the Assessment Hearing to be held later this fall after the project is completed.”
Full city ordinances for Newport are posted online at Municode, with Chapter 26 relating to “Streets, Sidewalks, and Other Public Places” and Chapter 34 to “Utilities.”
Closing out our special assessment comparison with a brief review of Woodbury, the assessment process in Cottage Grove’s northern neighbor is guided by a Road Construction and Rehabilitation Policy, made effective March 14, 2007 and last revised August 31, 2022.
Composed of seven pages in total and basing itself on a project wide rather than a street by street or block by block basis, the policy distinguishes between construction and rehabilitation, assessing the former at 100 percent generally (commercial roads and minor arterials at 75 percent) and at varying rates for the latter, ranging from 33 percent for streets with a residential land use, to 75 percent for streets with public/semi public land use, and 100 percent for parks and open space as well as commercial. Assessments in Woodbury are based on a 32 foot wide street in urban areas and a 28 foot wide street in rural estate areas. Residential streets that have never paid a street assessment to build a roadway to City standards, are assessed as a construction, rather than rehabilitation project, under the policy, while the percent of cost allocated for rehabilitation in rural estate areas is pegged at 10 percent for total reconstruction projects, and 33 percent for all other rehabilitation projects.
Similar to other municipalities, Woodbury city policy allows deferred payment of special assessments in certain instances, including for a homestead property owned by a person 65 years of age or older or retired due to a permanent and total disability for which it would be a hardship to make the payments, while income and property value limits apply to the deferment request. Interest continues to accrue during deferment, coming due when the applicant no longer qualifies for the deferral. Woodbury residents with questions on the income, property value and other qualifying requirements for a deferral may call 651-714-3519.