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HomeMy WebLinkAbout2003-06-17 CC MIN CITY OF STILLWATER CITY COUNCIL MEETING NO. 02-13 June 17,2003 SPECIAL MEETING 4:30 P.M. Mayor Kimble called the meeting to order at 4:30 p.m. Present: Absent: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble None Others Present: City Administrat9r Hansen City Attorney Magnuson Director of Administration Knauss Public Works Director Eckles City Clerk Ward OTHER BUSINESS Discussion on Budaet Solutions City Administrator Hansen stated that at the last council meeting, council allowed staff to pursue various means of resolving our current budget crisis, including the possibility of initiating franchise fees for electric and gas. He stated that on Monday, June 17, 2003, he and Dave Magnuson met with representatives of Xcel Energy to discuss franchise fees. He stated that the meeting was very amicable and they provided information regarding what a certain level of fees would generate in dollars and that Xcel had certain requests of their own, such as extending the franchise and release of bond requirements should the franchises be amended. Mr. Hansen stated that the electric and gas franchises are two separate franchises. He stated that state law allows for the electric franchise fee and a provision for up to a 5% fee is already provided for in the current franchise agreement. He stated that the representatives from Xcel recognize the City's ability to impose the fee, but are fearful that a 5% amount may cause a backlash with customers for both the City and Xcel. He stated that Xcel will be very cooperative on any franchise fee request for 3% or less, but would be compelled to address customer concerns at the 5% level. Mr. Hansen stated that the fees that could be generated are as follows: 1 % fee 3% fee 5% fee $95,299 per year $285,896 per year $476,495 per year 2003 (5months) $39,708 $119,123 $198,540 City Council Meeting - 03-13 June 17,2003 He stated that there would be very little cost in initiating this fee, as the billing would be done by Xcel and the fees simply paid to the City on a quarterly basis. He recommended a 3% fee because the cooperation of Xcel in initiating the program could prove instrumental to its success or failure. He stated that a total of 20 Minnesota cities charge a franchise fee for Xcel electric with more requests expected. Mr. Hansen stated that Xcel is much more sensitive to a franchise fee for gas because this is based on a perception regarding fixed income individuals and winter heating bills etc. He stated that Xcel is also concerned with a prediction for higher gas prices this winter and representatives have suggested that a 1 % franchise fee would be workable. He stated that as an alternative Xcel suggests $1 fee per month residential, $5 per month commercial charge for meters because it might be more acceptable to the public and would offer customers protection from gas price increases. 1 % fee $82,254 per year (at current price) $1/$5 meter charge $98,824 per year Mr. Hansen stated that the amount generated would be as follows: 2003 (5 months) $34,272 $41 ,177 Mr. Hansen recommended the charge for meters. He urged council consideration in initiating these franchise fee proposals. He stated that the money is not free and that the City is in essence shifting some former property tax dollars to a new form of taxation. He also stated that if the City continues to address the budget shortfall only through service cuts, and not increased revenue, the City would soon reach an unacceptable service level for our citizens. He stated that the City is controlling spending by having absorbed $750,000 in reductions last year and another $425,000 in 2003. He also stated that increasing revenue would be even more important when it comes to the 2004 budget, as the City's promised LGA amount will likely be reduced further. Councilmember Junker asked if the residents would see this charge on their bill. City Administrator Hansen stated that it would be a separate line item on their electric and gas bill. Council member Rheinberger stated that the elections sent a message of no new taxes and all this is the charging of a fee rather than a new tax. He stated that there should be a hard and public debate on this issue. He stated that it is just a matter of shifting some former property tax dollars to a new form of taxation and he could not support that taxation. He suggested that the funding of the library be cut because it is not self sustainable. Councilmember Milbrandt stated he would like revitalizing the prospect of a liquor tax, sales tax, or hotel tax to pay for some of the shortfall. He stated he does not like the idea that only the residents should bare the cost of the shortfall where 20% minimum Page 2 of 12 City Council Meeting - 03-13 June 17,2003 are for services for people who visit Stillwater who pay nothing. He asked if this could be discontinued if another revenue source becomes available. City Administrator Hansen stated that it could be discontinued. He stated that in order to get a sales tax it would have to go to the legislature and the City would not benefit from that until 2005. Council member Kriesel concurred with Council member Milbrandt regarding the residents receiving the full impact of this and supports looking for other revenue sources that would affect the tourists more than residents. Mayor Kimble stated that there have been reductions on homes within the community because new developments occurred in Stillwater. He stated that because of the levy limits the City is unable to capture the tax benefit, which means the additional developments reduce taxes. He also stated that because of legislative controls, cities have to find other revenues to sustain staff, police officers, and office hours. Council member Milbrandt stated he also would like to hear about the street lighting district and address this issue as part of the budget package rather than separately. Mayor Kimble moved the item regarding Street Lighting District from the 7:00 agenda to be considered as part of the budget package. City Administrator Hansen recommended that the fire department fees be dispensed at this time. Council member Kriesel would like to see the fireworks permit addressed for 2004. Public Works Director Eckles stated that City staff has examined how a lighting system would work and also looked at potential revenue generation and that the option of a street lighting utility makes sense in that everybody in the City benefits from street lights and traffic signals. Even residents that have little or no city street lighting use the city street system and benefit from the safety provided by streetlights and traffic signals. He stated that since the City of Stillwater already has several utility funds and everybody receives a quarterly city utility bill, addition of a street lighting utility would be straightforward. Mr. Eckles stated that in setting the rates for a street lighting utility, Council would need to take into account the street light systems and the type of users. He stated that similar to the storm water utility, rates could be based on a per unit basis for residential and a per acre basis for commercial, institutional, golf course and open space with each of these categories having a different rate. He stated that commercial could be broken down into normal commercial and special district commercial. He stated that the special district commercial would consist of properties in the downtown district that benefit from the extensive lighting there as well as the marketplace area that has it's own street light system. Page 3 of 12 City Council Meeting - 03-13 June 17, 2003 He stated that the current budget for street lighting and traffic signals is $215,000, which includes $170,000 for electricity. He also stated that there is some general engineering and public works staff dedicated to managing the City's current system. He stated that if the City set up a street lighting utility, it would also be beneficial to accumulate some capital for street lighting project upgrades. He stated that the proposed commercial special district has lighting that will need to be reconstructed as it wears out and that rather than assessing these costs, they could be charged to the street lighting utility which would justify the higher quarterly charges to the commercial special district. He stated that if the City wishes to capture enough revenue to cover all of the signs and lighting budget as well as cover staff time associated with lighting and the capital improvements, annual revenue of about $300,000 appears to be an appropriate target. He stated that staff has done some very rough calculations to determine approximately how much would be charged for the various user groups to achieve a $300,000 revenue. He explained a rate schedule for the following information to achieve this level of funding. He stated that using this formula each residential unit would pay about $32 a year which would raise about $200,000 and the commercial properties would pay based on the size of their property, the minimum being an % acre unit which would yield $140-400 per year for the smallest commercial property. He stated that all categories excluding residential would generate roughly $100,000 a year. He stated that the high rates for institutional and commercial are justified because these areas serve as major destinations for large numbers of pedestrians and vehicular traffic. He also stated that lighting systems tend to be centered around commercial areas or at corners where commercial properties are located. He stated that golf course property has a fairly low rate but the two golf courses own significant property but that these rates also appear justified in that golf courses generate significant traffic. Council member Milbrandt and Kriesel felt that some of the rates would need to be adjusted. He also asked if the franchise fee and street lighting charge could be terminated. City Attorney Magnuson stated that if Council felt the City had too much money, they could lower taxes or the Council could terminate any charges. Council member Rheinberger said again that whether it is a franchise fee or a street lighting charge it is still another tax to the residents. He stated because this is just shifting some former property tax dollars to a new form of taxation; he could not support this taxation. He stated there needs to be efficiencies and the City will have to live within what the State gives us. He stated that core services need to be defined. He stated he could see the district being used in the commercial areas but street lighting in residential is an expected core service which property tax should pay for. Public Works Director Eckles stated that staff would be able to put other options together for the next meeting. He also stated that this money would be designated just Page 4 of 12 City Council Meeting - 03-13 June 17, 2003 for street light repair and the payment of costs associated with the system. He stated that there would be some setup costs for including the street light charge on the utility bill. Councilmember Kriesel stated that the City is at the point where either core services are cut or we need to raise revenue to keep those services. Councilmember Junker stated that the affect would be $65.00 annually per household. Council member Rheinberger stated he wanted more options, because any way you look it is a tax. He stated that we do not have to follow other cities. Council member Milbrandt stated that Council has an obligation to respond to the citizen's expectation. He stated that the Council has been dealt an issue that forces the Council to be more creative and if this helps keep core services and police officers on the street he was willing to make the decision. Councilmember Rheinberger stated that this is a shift of money. Council member Junker stated that this is reasonable and workable; it is a reasonable increase to sustain the budget. Motion by Councilmember Milbrandt, seconded by Council member Junker to adopt Resolution 2003-138, approving franchise fees for electric and gas, with the amount of 3% for electric and a $1 meter charge for gas. Ayes: Councilmembers Kriesel, Milbrandt, Junker and Mayor Kimble Nays: Councilmember Rheinberger Motion by Councilmember Milbrandt, seconded by Councilmember Junker to adopt Ordinance No. 938, an ordinance emending the Stillwater City Code by adopting Street Lighting Regulations with fees to be determined after more options for rates are presented to Council. Ayes: Council members Kriesel, Milbrandt, Junker and Mayor Kimble Nays: Council member Rheinberger Councilmember Rheinberger requested that the Council discuss the Library funding. Council member Kriesel stated that the library is important to the community, that even though he may not agree with the expansion of the library he doesn't feel that the City should close down the library. He suggested that Council hold a workshop with the library to allow Councilmembers to speak on the issue. Motion by Council member Kriesel, seconded by Council member Rheinberger setting a special meeting on library issues for July 15, 2003 at 4:30 p.m. All in favor. Page 5 of 12 City Council Meeting - 03-13 June 17,2003 Mayor Kimble recessed the meeting at 5:59 p.m. REGULAR MEETING 7:00 P.M. Mayor Kimble called the meeting to order at 7:00 p.m. Present: Absent: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble None Others Present: City Administrator Hansen City Attorney Magnuson Community Development Director Russell Assistant Finance Director Harrison Public Works Director Eckles City Clerk Ward APPROVAL OF MINUTES Motion by Councilmember Rheinberger, seconded by Councilmember Kriesel to table approval of the June 3, 2003 minutes to the July 1, 2003 meeting. All in favor. PETITIONS, INDIVIDUALS, DELEGATIONS & COMMENDATIONS Tom Koop. Larson Allen Weishair and Co.. LLP - City Financial Statement Mr. Koop reviewed the City's financial statement. He stated that the City is in good financial shape. He commended the City's finance department and Assistant Finance Director Harrison on their performance in the finance department. David Wakudumira. Mayor of Sister City Jinia Mr. David Wakudumira, Mayor of Jinja, provided the Mayor with a token of friendship between the City and the City of Jinja. He provided information on the City of Jinja and invited the Mayor and Council to visit his city. Mayor Kimble recessed the meeting for a reception for Mayor Wakudumira at 7:25 p.m. Mayor Kimble reconvened the meeting at 7:50 p.m. STAFF REPORTS Council member Kriesel stated that he is receiving many calls on garage sale signs being removed. Page 6 of 12 City Council Meeting - 03-13 June 17, 2003 Community Development Director stated that they do not go out looking for them, that staff is just enforcing the sign ordinance. Councilmember Kriesel requested that the sign ordinance be brought to the Council for discussion. Public Works Director Eckles infprmed the Council that the McKusick Ravine project is nearly done and that a "pulling of the plug" for the creek will be done on Friday and asked the Mayor to do the honors. CONSENT AGENDA Motion by Councilmember Rheinberger, seconded by Councilmember Junker to approve the Consent Agenda. All in favor. Ayes: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None , .. Resolution 2003 - 135, directing payment of bills Approval of gambling permit - Dystrophic Epidermolysis Bullosa Research Association of America, Inc. - Oak Gler:LCp~nty Club Resolution 2003 -137, approving Labor Agreement between the City of Stillwater and the Stillwater Firefighters Association PUBLIC HEARINGS Case No. SUB-F/03-56. A reQuest from Terra SprinQs. LLC. for final plat approval for a 7 lot subdivision includinQ two outlots as follows: Lot 1 Blk 1 - 37.055 SQuare feet Lot 1 Blk 2 - 36.052 SQuare feet Lot 2 Blk 2 - 62.779 SQuare feet Lot 3 Blk 2 - 37.405 SQuare feet Lot 1 Blk 3 - 48.474 SQuare feet Outlot A - 107.559 SQuare feet and Outlot B - 116.809 SQuare feet located at 608 North Main in the CBD. Central Business District. Community Development Director, R.ussell reviewed the final plat for Terra Springs. '~ ' ' Mayor Kimble opened the public ,hearing. There were no public comments. Mayor Kimble closed the public hearing. Motion by Councilmember Rheinberger, seconded by Councilmember Milbrandt to adopt Resolution 2003-139, approving the final plat approval for 608 North Main in the CBD, Central Business District \ ':~ ~ ::: ~ ;., j-.., Page 7 of 12 City Council Meeting - 03-13 June 17,2003 UNFINISHED BUSINESS Discussion on proposed Street Liahtino Utilitv fee and possible 2nd readino on ordinance relatino to street Iiohtina fees Second reading adopted at 4:30 meeting. NEW BUSINESS Possible appointment to Water Board Mayor Kimble stated that Jim O'Brien's term on the Water Board expires June 30, 2003. He stated that Mr. O'Brien has requested reappointment. Motion by Councilmember Rheinberger, seconded by Councilmember Junker to adopt Resolution 2003-140, appointing Jim O'Brien to the Water Board. All in favor. Ayes: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None Authorization for preparation of feasibilitv report for North Hill proiect Public Works Director Eckles stated that the City would receive a $1.3M grant for Browns Creek Improvements, which will be used as funds for costs associated with the North Hill project. He stated that since Council did not order the project within the one- year timeframe by statute the results of the first feasibility hearing are now void. He stated that staff would like to proceed with the improvements for the North Hill by updating the feasibility report, which consists of revising project costs and assessment costs. Council member Rheinberger asked what would be the time frame. Mr. Eckles stated that the feasibility report would be presented to Council in July with a public hearing proposed in August. He stated that maybe some of the trunk utilities could be installed yet this year. Motion by Council member Rheinberger, seconded by Councilmember Milbrandt to adopt Resolution 2003-141, resolution ordering the preparation of feasibility report for the North Hill project (Project 2000-15). All in favor. Ayes: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None Page 8 of 12 City Council Meeting - 03-13 June 17, 2003 Possible approval of Water Street ParkinQ Facilitv. Plaza. Flood Wall and Trail Studv Proposal Community Development Director Russell stated that Council previously authorized staff to obtain a proposal for the Stillwater North Main Street Housing Infill and Pedestrian Connection Project. He stated that components of the study would examine the railroad trail from Laurel to Nelson, the Main Street Plaza and connection to Lowell park parking and a structure/flood wall as a part of the parking structure. He stated that community participation would be part of the study, which would include design professionals, city committees and commission, downtown business representatives and City residents. He also stated that the plans would be coordinated with the Lowell Park Plan, Levee Project Phase II and plans for the Lofts of Stillwater and Terra Springs. He stated that TIF funds would be used to pay for the study and recommended approval of the proposal from Short, Elliott and Hendrickson in the amount of $50,000. Motion by Council member Rheinberger, seconded by Councilmember Milbrandt to adopt Resolution 2003-142, approving proposal from Short, Elliott and Hendrickson for the Water Street Parking Facility, Plaza, Flood Wall and Trail Study. All in favor. Ayes: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None Approval of Quotes for McKusick Ravine stairs and hand railing Public Works Director Eckles reviewed the quotes for the stairs and hand railing installation as part of the McKusick Ravine project. He recommended that Bailey Construction be used for the construction of the concrete stairs at a cost of $25,500.00 and that Jay Brothers, Inc. be used for the construction of the hand railings at a cost of $12,800. Motion by Council member Rheinberger, seconded by Council member Junker to adopt Resolution 2003-143, accepting proposal and awarding contract for the installation of stairs and hand railing for the McKusick Ravine project. All in favor. Ayes: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None Possible approval of Quote for Pedestrian Crosswalk StripinQ Public Works Director Eckles stated that every year the City paints crosswalks in the City. He stated that staff received two quotes and the low bidder is Stripe-A-Lot with a bid of $12,438.78. Council member Milbrandt asked if this company has worked in the city before. Page 9 of 12 City Council Meeting - 03-13 June 17, 2003 Mr. Eckles stated that the company has done work in the City previous years. Motion by Councilmember Rheinberger, seconded by Council member Milbrandt to adopt Resolution 2003-144, accepting proposal and awarding contract for pedestrian crosswalk striping. All in favor. Ayes: Councilmembers Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None Discussion on 2:00 a.m. bar c10sina Councilmember Rheinberger stated he is not in favor of the 2:00 a.m. bar closing. Councilmember Kriesel stated he has some concerns in relation to the Police Department and requested that Council table the issue until Chief Dauffenbach is available to respond to Police Department impacts. Motion by Councilmember Kriesel, seconded by Councilmember Rheinberger to table discussion until the 4:30 meeting on July 1 and directed staff to contact liquor license holders to invite them to the meeting to provide their views on the issue. Reauest for outside sales - Jerry & Mary Mechelke Mayor Kimble reviewed the request for outside sales of fireworks at the Lumber Barons. Councilmember Milbrandt expressed concern on the hours of operation, would rather see it from 8 a.m. to 9:00 p.m. or 10:00 p.m. Motion by Council member Junker, seconded by Councilmember Kriesel approving the outside sales of fireworks conditioned upon the hours of operation being 8:00 a.m. to 10:00 p.m. and that no use of parking lots be used for the venture. All in favor. Transfer of Wine with Strono beer liauor license from Amy's at Brunswick to Jeffrey Mark Dahl. DBA: Chives Mayor Kimble reviewed the request for the transfer of the wine with strong beer liquor license. Motion by Council member Rheinberger, seconded by Council member Kriesel to adopt Resolution 2003-145, approving transfer of wine with strong beer liquor license - Amy's at Brunswick to Jeffrey Mark Dahl, DBA: Chives, conditioned upon the filing of all required documents, approval by Po!ice, Fire, Inspection, Finance and Minnesota Liquor Control. All in favor. Ayes: Council members Kriesel, Milbrandt, Rheinberger, Junker and Mayor Kimble Nays: None Page 10 of 12 City Council Meeting - 03-13 June 17,2003 COMMUNICATIONS/REQUESTS Request for variance to noise ordinance - Jessica Lanae Mayor Kimble reviewed the request for variance to the noise ordinance. Motion by Councilmember Rheiinberger, seconded by Councilmember Junker to approve the variance to the noise ordinance to no later than midnight. All in favor. Letter from Duane Seaquist reaardina Impervious Surfaces and Disposal of Water Runoff Council received Mr. Seaquist letter. COUNCIL REQUEST ITEMS Councilmember Kriesel expressed concern at the traffic that was generated by the bike race over the weekend. He also stated that he received complaints regarding people stopping traffic (not police officers) and vendors shutting down businesses. City Administrator Hansen stated that he had received similar complaints and would investigate the traffic issue with Chief:Oauffenbach. He also stated that no one from City staff shut down local businesses for a lack of a vendor permit and that some of the complaints related to individuals not associated with the bike race. ADJOURNMENT L: . Motion by Councilmember Rheinberger, seconded by Councilmember Kriesel to adjourn the meeting at 8:34 p.m. All in favor. Gfft~~ ATTEST: ~~ Wa4PG. Diane F. Ward, City Clerk Resolution 2003-135, directing payment of bills Resolution 2003-136 - Not Used Resolution 2003-137, approving Labor Agreement between the City of Stillwater and the Stillwater Firefighters Association Resolution 2003-138, approving franchise fees for electric and gas Resolution 2003-139, approving the final plat approval for 608 North Main in the CBD, Central Business District Resolution 2003-140, appointing Jim O'Brien to the Water Board Page 11 of 12 ~ G l ,_. l -'._" ;.~ (J City Council Meeting - 03-13 June 17, 2003 Resolution 2003-141, resolution ordering the preparation of feasibility report for the North Hill project (Project 2000-1,5) Resolution 2003-142, appro.ving proposal from Short, Elliott and Hendrickson for the Water Street Parking Facility, Plaza, Flood Wall and Trail Study Resolution 2003-143, accepting proposal and awarding contract for the installation of stairs and hand railing for the McKusick Ravine project Resolution 2003-144, accepting proposal and awarding contract for pedestrian crosswalk striping Resolution 2003-145, approving transfer of wine with strong beer liquor license - Amy's at Brunswick to Jeffrey Mark Dahl, DBA: Chives Ordinance No. 938, an ordinance emending the Stillwater City Code by adopting Street Lighting Regulations ;', 'I: l' . ; ; ~ - ~,. 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