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HomeMy WebLinkAbout1980-02-25 CC MIN• • • COUNCIL CHAMBER Stillwater, Minnesota REGULAR MEETING The meeting was called to order by President Junker. Present: Councilwoman Bodlovick, Councilmen H. Peterson, R. Peterson, Powell and Mayor Junker Absent: None Also Present: Press: St. Paul Dispatch, Broede Citizens: None INDIVIDUALS & DELEGATIONS None PUBLIC SAFETY No report PUBLIC WORKS No report FIRE CHIEF No report February 25, 1980 4:00 P. M. Finance Director /Coordinator, Kriesel; City Clerk, Schnell; City Attorney, Magnuson, Director of Public Safety, Abramhanson; Fire Chief, Chial; Director of Parks & Recreation, Blekum; Consulting Engineer, Elliott COMMITTEE REPORTS CITY CLERK'S REPORT 1. On motion of Councilman Powell, seconded by Councilwoman Bodlovick, the Council authorized the attendance of the City Clerk at the City Clerk's Conference on March 26 -28, 1980 at Alexandria, Minnesota. (all in favor) BUILDING OFFICIAL MAYOR JUNKER introduced the new Building Official, Allen Zepper at this time. CITY ATTORNEY'S REPORT 1. On motion of Councilman Roger Peterson, seconded by Councilwoman Bodlovick, Mr. Kriesel was instructed to inform Rivertown Restoration that the bond will not be reduced until a proposal is accepted for the feasible and prudent use of the Nelson School. (all in favor) PARKS AND RECREATION 1. MR. BLEKUM informed the Council that the engineering fees for the survey for Pioneer Park will cost the City $1,970.00 to be done by Short - Elliott - Hendrickson, Inc. On motion of Councilman Roger Peterson, seconded by Councilwoman Bodlovick, the Council approved the Consulting Engineering firm to do the survey for Pioneer Park providing that Mr. Kriesel can find the funding for same. (all in favor) (Mr. Blekum reported later in the meeting that the money would be available in Capital Outlay) 2. MR. BLEKUM made reference to the two items under New Business in reference to Lowell Park for Lumberjack Days and he was concerned about the cleanup following the celebration which was not taken care in the past two years. Mr. Kriesel requested that the the Council meet with Mr. Orff either on March 3rd or 10th, but no commitment was made for either dates. He suggested that in the contracts between the Chamber and the leasor that they have one party from each responsible for cleaning up their area, but the Council felt that the Chamber should be responsible for this work. 51 • • • / • • X 1 2 February 25, 1980 CONSULTING ENGINEER'S REPORT 1. Mr. Elliott reviewed the Icerim I/I Study File No. 79047 dated February 11, 1980 with the members of the Council. He mentioned that the EPA financing for this project could be from two or three years away and this would be a long time to wait to solve the current high flow. Inflow is the surface water that finds its way into the sanitary sewer by some means by leaking through manholes. Infiltration leaks through the pipes and joints. In order to remove sump pumps or roof drains does require an alternate point of discharge - some of them are simple by draining them out into the alley ways - the water from the roof cannot be drained unto public sidewalks - an alternate point of discharge for either of these is a problem - there is very little storm sewer on Main Street -- what is there crosses Main Street - Commercial, East Myrtle, East Chestnut and Nelson Street. There is a choice fro the places on these corner lots, but there is not a choice for those that are mid - block. He questioned Mr. Magnuson if there could be a surcharge for those businesses that do not have a choice for the roof drain connection or the sump pump that dis- charges into the sanitary sewer system. It would require an estimation on the part of the roof drains (get the area and the average rain fall for the year), for the sump pumps it would require the installation of an hour meter. The Water Department could read these meters when they read the water meters. This would be one way of relieving the city of the burden for these high costs. There is nothing that can be done until the I/I Study is completed. He was not sure what the participation would be for the construction of storm sewers to take care of these problems. He feels that the greater portion of this comes from the infiltration through the old pipes in the system COUNCILMAN ROGER PETERSON felt that most cases Mr. Elliott es.".nates were very light from the various springs in the downtown area. MR. ELLIOTT stated that the most noticeable one of the inflow was from down by the caves which was taken care at the time of the separation which was for one connection and he felt that this dropped a half million gallons per day off the total flowage. The estimated cost of this study would be in the range of fifty to seventy thousand dollars and the City would have to pay 10% of that cost. The Council felt that these parties that have drainage into the system should be sent notices showing the quantities involved and then let the people prove that they are not contributing to the sanitary sewer system and that they be informed of the cost per gallon for this treatment. MR. MAGNUSON stated that the problem that the City is going to have is with foundation drains and sump pumps and roof leaders could be pin - pointed with some sort of a liability. The flowing spring water is iping to be the problem - the Water Department lets that old creek through their building and they are contributing to it. MR. ELLIOTT stated that some ofthem that did take them off and run them into the utters that there is a build -up of ice in the winter months and causing some problems On motion of Councilman Roger Peterson, seconded by Councilman Powell, the Council instructed the Director of Public Works and the Consulting Engineer's office and the Building Inspector to pursue this matter as far as measuring the flows of the spring waters with the idea of eventually billing these people for this flow. (all in favor) 2. Mr. Elliott informed the Council members regarding the plat by the Hooleys to the west of the bank area which will be for 13 lots and the Kern- Pauley Plat which has already been approved in the Industrial Park. He suggested to the Council that they consider the possibility of a Council inititated project in the way of providing services to those lots and do it under a controlled contract. Some of this could be done by jacking under the street to avoid the cuts into the street - he will talk to Kern and the Hooleys to see if they would entertain such a suggestion and the questions will be if this would be assessed - a few of these lots have services. He explained the location of the services which were put in under another project. MR. MAGNUSON as a matter of assessing and he felt that if the Council inititated the project that the City could assess the property owners and possibly a better way ould be a hookup deal and this would be a way of getting them paid off quicker. MR. ELLIOTT stated that there is not a sale for large tracts of land and that Mr. Kern has sold quite a few of the lots. COUNCILWOMAN BODLOVICK indicated that in the information that she had received from Dan Koehler about the sub- dividing industrial lots into small portions is not in keeping with an Industrial Park - this is completely contrary to an Industrial Park. i1 M • • 1 • • • 0 • February 25, 1980 MR. ELLIOTT indicated that there is a possibility that they will have to have some internal storm sewer systems if when individual site plans are submitted that they do not allow for the conveyance of water. The individuals site plans are not available, but there should be provisions made for the drainage ease- ments along the lot lines. He suggested that the grades be that each development be such that they fit into an overall drainage plan. Mr. Elliott will send a letter to the Joint Powers of his report or possibly he will attend this meeting to explain these problems. CITY COORDINATOR'S REPORT 1. Mr. Kriesel informed the Council that they have to appoint an Advisory Board to study the Cable TV systems - Bayport and Oak Park Heights and he agreed that there be a seven member board - two from each community and somebody from the School District. Neither Bayport or Oak Park Heights really feel that we need a formal Joint Powers written agreement - they felt that this board could deter- mine what the City needed as far as Cable T. V. and the Councils could draft a model franchise ordinance that all three cities could atopt and basically would have the same Cable T. V. system. MR. MAGNUSON stated that what has to be done i a need assessment and each community could do their own. Questions were raised about the size of the board according to the State require- ments and other duties of this board and they were informed that this board is going to have to study this and draft a franchise ordinance. MR. KRIESEL stated that the Coujcil could pass a resolution designating some members to serve on the Joint Advisory Commission with the other cities - this would address all of the city's needs but as one need. COUNCILMAN POWELL made a motion that we appoint Mayor Dunker and Councilwoman Bodlovick to this Joint Advisory Board for the Cable T. V. which was seconded by Councilman Roger Peterson. After some discussion Councilman Roger Peterson withdrew his second and Councilman Powell withdrew the motion. On motion of Councilman Roger Peterson, seconded by Councilman Powell, that the City advertise in the paper that the City is looking for citizens to volunteer for the Citizen Advisory Committee for Cable T. V. and would like to have their application or request in by the next regular Council meeting. (all in favor) 2. On motion of Councilman Powell, seconded by Councilman Roger Peterson, the Council recommended that Robert Miller be the respresentative from the School District on the Cable T. V. Advisory Committee. (all in favor) 3. MR. KRIESEL brought up the matter of the Public Works Contract and he had checked with Washington County this date - for 1980 they have 63C increase for the Light Equipment operator and a 66c increase for the Heavy Equipment Operator which would bring the 1980 rate to $8.23 and $8.62 respectively. The City's rate for 1979 is $757 for the Light Equipment Operator and $8.09 for the Heavy Equipment Operator and with a 60c increase that would bring it to $8.17 and $8.69 respectively. For 1981 Washington County is giving 68c for the Light Equipment Operator which would bring it up to $8.91. He felt that the City could possibly reach a settlement with $70/65/60 with the CPI adjustment - 857. of the change for the third year of the contract. The Council was not in agreement for the cost of living increase. The above increase would come to $121.10 per month increase which is about 97,. MAYOR JUNKER added that the Council turned down $120.56 for the Firefighters and this was because of the differential between the departments. On motion of Councilman Roger Peterson, seconded by Councilwoman Bodlovick, the Council offered $70/65/60 to the Public Works and Parks Departments without the 85% CPI for the third year. (all in favor) There was discussion about the fringe benefits between the Departments regarding hospitalization coverage amounts which is paid for by the City. MR. KRIESEL stated that it will possibly be July or August before the Fire Department Arbitration hearing is set. There was discussion about making another offer to the Fire Department - at mediation the City offered them $104.00, but have not agreed to the $120.56. 53� • • • • 4i4 February 25, 1980 MISCELLANEOUS 1. MAYOR JUNKER asked Mr. Magnuson about the sewer refund money that the City has received from the Metro Waste Commission and what the plans are for the dis- tribution and use of same. He felt that it was time to do something with the money. - return the money to the parties that are entitled to same. MR. MAGNUSON stated that sometime ago he informed the Council that when the City code was adopted there is an ordinance saying that there is a certain period of time that the people have to apply for this - this is ninety days - this is based on an ordinance that was prepared by Mr. Schriefler who was one of the committee members who was appointed to decide what to do with the money - he said that if the communities kept it, they would get into multiple claims - the City has a duty to give the people reasonable notice of the method that they could apply to get that back and the opinion was based on the Minnesota Statute involving unclaimed property which provides that if they are conflicting claims, those claims have to be settled and both parties have to agree on how the payment is to be divided up - if all parties do not agree on how it should be divided, then the City gets to keep it. The refunds vary from $250 to $600 per home or buildings. There have been no claims submitted because the City has not given notice as to how to go about it and that was the idea of this ordinance - he suggested that the Council have the second reading this evening. MR. MAGNUSON has always advised against the City using this money and couldn't imagine that Orrin Thompson or other people would not bring a claim against the City for this money in the future - if the City uses all that money and you could have to pay it back - you could have to settle a whole bunch of little claims. If there is a claim from Orrin Thompson and the home owner, the City can issue a check with both names on it and they will both have to endorse it and they have to agree on who gets it. 2. MAYOR JUNKER asked Mr. Elliott if anyone has checked the work on Local Improvement No. 177 and he stated that Dick Moore was out there - they wanted to make sure that they had the heat on the job over the weekend. Jack and George are keeping track of the hours for this job. MR. ELLIOTT stated there was a stump in the culvert and how it got there and that was the root of a lot of the problem because the stump in itself was holding back tires and other debris that caused enough blockage to keep the sand from going through. He felt that tle problem is one of fairly long standing and that there was debris in that pipe and a question of whose responsibility that was - a good record was kept by the contractor of the debris that was taken out of there and he really felt that the City could possibly have a claim against the railroad for having done some of the work for the railroad. MAYOR JUNKER felt that "NO DUMPING" signs should be put up there and also put up some barricades so that they don't dump there and no fill either. ON MOTION OF COUNCILWOMAN BODLOVICK, SECONDED BY COUNCILMAN POWELL, THE MEETING RECESSED AT 5:30 P. M. TO 7:30 P. M. The meeting reconvened at 7:30 P.M. by Mayor Junker The Invocation was given by the City Clerk. Present: Councilwoman Bodlovick, Councilmen Harry Peterson, Roger Peterson, Powell and Mayor Junker Absent: None Also Present: Press: Citizens: INDIVIDUALS AND DELEGATIONS None PETITIONS None Finance Director /Coordinator, Kriesel; City Attorney, Magnuson; City Clerk, Schnell; Consulting Engineers, Elliott and Moore WAVN - Gary Larson Mr. & Mrs. Steven Roettger, Ron Schoenborn and Mr. & Mrs. Bud Jagusch r e0- • • • • • • • ^ February 25, 1980 • r PUBLIC HEARINGS -- -This was the day and time for the public hearing for the proposed vacation of portions of Oak and Oakes Streets. Notice of the hearing was published in the Stillwater Gazette, the official newspaper of the City, on February 15, and 22, 1980 and copies were mailed to all property owners within 300 feet. The Mayor opened the hearing. BOB LORENTZEN, 1811 West Olive Street, requested that he would be in favor of vacating the street all the way to Olive Street if that was agreeable to the City - (according to the petition it terminated midway through this block for a distance of 150 feet). He stated that between his property line and Mr. Kirchner's there is not 50 feet - there is only 32 feet, which is Oakes Street. MR. ELLIOTT stated while it is platted at fifty it measures 32 - the case would be that whatever is there it may be in error - that which is there would be divided half to each of the abutting property owners - he claims that the irons between the two properties there are only 32 feet - if there is a difference that would have to be resolved. MR. MAGNUSON stated that if there is a difference in the blocks that would come off the private ownerships and it is possible to get adverse possession from them for the platted public street - the street would be fifty feet wide. 66 COUNCILMAN ROGER PETERSON asked if we would have to include some area to the I R north that is not shaded, would we have to start the hearing all over or can it be extended - who is the neighbor on the other side. MR. MAGNUSON stated that the statute that we are proceeding under and this is the first time that the City has ever used as they have always used the Charter, which requires a petition of the majority of the abutting property owners plus the public hearing - there is also a statute which is being used in this case which says "the City can get a petition from any one abutting owner can vacate a street and the only requirement is that it is at a public meeting. MR. LORETNTZEN stated that Mr. Kirchner also owns the land that is adjacent to the original 150 feet of this street which was petitioned for and the three property owners are Mr. Kirchner, the Roettgers and himself. COUNCILMAN POWELL indicated that Mr. Kirchner indicated approval at the last meeting of the City Council for these vacations. The Mayor closed the hearing. On motion of Councilman Powell, seconded by Councilwoman Bodlovick, a resolution was introduced "VACATING PORTIONS OF OAK AND OAKES STREET ". AYES -- Councilwoman Bodlovick, Councilmen H. Peterson, R. Peterson, Powell and Mayor Junker NAYS - -None (see resolutions) CONTINUATION OF THE HEARING ON LILY LAKE PUMPING RON SCHOENBORN, 514 South Hemlock, appeared before the Council on this matter with the assurance that it will be pumped low enough to protect his property which is the second lowest piece of property on the north side and he expressed his encouragement that this project be done and asked about the controlled level of the lake. MR. ELLIOTT stated that is what they are asking for which is somewhat lower than what the Department of Natural Resources is asking for which was 843 which was the level very near to what it was at the time the Ice Arena was constructed and the beach area available at that time. MR. SCHOENBORN ward to express his concern that they not go to an extreme the other way and did not want to see mud flat out in the lake and he was sure that there were other people on the lake whvdid not want that either. MR. ELLIOTT stated that in 1970 there was not a level that exceeded 843 - it was always 843 or lower - 1974 was the first high year of 845.6 and he had the high levels for each of the subsequent years. He felt that the level of 843 is one that is desirable for the beach that has been developed and the width of the beach at that level and he felt that this would be an excellent compromise. COUNCILMAN POWELL asked about the shallow "shelf or bar" which could years ago be seen and a person could :calk out there and fish and he was wondering what 842 or 843 might do to that and make it more visible. 55N • • • • • APPLICATIONS None COMMUNICATIONS None February 25, 1980 MAYOR JUNKER felt that we do not want to get it too low and destroy some of the areas around the lake and get it too low. MR. ELLIOTT stated that the three sensitive areas are the swimming beach, Schoen- barns and Jagisch's and felt that the 843 would do the job for the City and will not change the lake very substantially from what it normally has been. The current level is 846 plus. COUNCILWOMAN BODLOVICK asked who has the final say on the level - and she was informed absolutely the DNR. MR. ELLIOTT stated that the estimated cost of the improvement is $121,100 and there has not been discussion on how it will be financed - that includes using the old plastic pipe and MR. KRIESEL stated that he is awaiting a reply from the Pollution Control before ordering the improvement based on the financing. (Mr. & Mrs. Jaguisch arrived later in the meeting and Mayor Junker informed them that it would be pumped to a level of 843 as recommended by the DNR). UNFINISHED BUSINESS 1. On motion of Councilman Roger Peterson, seconded by Councilwoman Bodlovick, a resolution was introduced EMPLOYING ALLEN ZEPPER AS BUILDING OFFICIAL" effective February 25, 1980 for a six months probationery period. AYES -- Councilwoman Bodlovick, Councilmen H. Peterson, R. Peterson, Powell and Mayor Junker NAYS - -None (see Resolutions) 2. On motion of Councilman R. Peterson, seconded by Councilwoman Bodlovick, the City Attorney made the second reading of an ordinance entitled "AN ORDINANCE ADOPTING A REVISION AND CODIFICATION OF ORDINANCES, TO BE KNOWN AS THE STILLWATER CITY CODE; PROVIDING FOR THE REPEAL OF CERTAIN ORDINANCES; PROVIDING FOR THE PRESERVA- TION OF CERTAIN RIGHTS AND PROVIDING NOTICE OF THE ADOPTION THEREOF PURSUANT TO MINNESOTA STATUTES SECTION 415.021." (Ordinance No. 581) The ordinance was read section by section followed by roll call after each section and all members of the Council voted in the affirmative. The chair then put the question, "Shall this ordinance pass ?" and on roll call the ordinance was unanimously adopted. NEW BUSINESS 1. On motion of Councilman Powell, seconded by Councilman Harry Peterson, the claim from Mrs. Herbert Baab, Newport for injuries from a fall at 119 South Main Street was directed to be sent to the McGarry- Kearney Insurance Agency. (all in favor) 2. On motion of Councilman R. Peterson, seconded by Councilwoman Bodlovick, Mr. Kriesel was directed to meet with Lynn and Jack Shelton on the matter of the outdoor lights for the Public Library and that they come back with several quotes at the next regular meeting. (all in favor) 3. On motion of Councilman R. Peterson, seconded by Councilman Powell, a resolution was introduced "DIRECTING THE PAYMENT OF THE BILLS" AYES -- Councilwoman Bodlovick, Councilmen H. Peterson, R. Peterson, Powell and Mayor Junker NAYS - -None (see resolutions) COMMITTEE REPORTS (continued) CITY COORDINATOR'S REPORT 1. On motion of Councilman R. Peterson, seconded by Councilwoman Bodlovick, a resolution was introduced "RESOLUTION RELATING TO A $50,000 GENERAL OBLIGATION BOND: AUTHORIZ- ING THE ISSUANCE THEREOF PURSUANT TO SECTIONS 197 THROUGH 201, INCLUSIVE OF THE CHARTER OF THE CITY OF STILLWATER, AS AMENDED, AND MINNESOTA STATUTES 475.60, SUBD. 2, SUBSECTIONS (1) and (2) ". (Financing for Local Improvement No. 177 - Burlington Northern Drop Structure) There was discussion if there is an amount left over that it be used for the construction of the stairway to the lower level of the City Hall Building. Y a iH 0 Y • 0 • • • 0 1 PSI a • February 25, 1980 2. On motion of Councilman R. Peterson, seconeed by Councilman Powell, the Council authorized the payment of longevity pay and dependent hospitalization coverage to George Diethert in the same manner as paid to the other Public Works Depart- ment Union employees, effective March 1, 1980. (all in favor) (Nothing is to be paid retro- active before this date) 3. Mr. Kriesel briefly discussed with the Council the HMO Health Plan and he will be getting another report which he will give to the Council which was a side -by- side presentation of the two programs. He asked that the Council authorize him to have the representatives from the companies come in to explain the program - and answer any questions. This would be done with the understanding that any difference in the coverage would have to be picked up by the employees,(sometime after March llth for this meeting.) CONSULTING ENGINEER'S REPORT (continued) 3. DICK MOORE presented to the Council the feasibility study for Local Improvement No. 178 as petitioned by Kern Pauley for their two new plats in the Stillwater Industrial Park. The petition was only for service to the lots in Outlot C - in addition to the service to these lots, there are also two lots in Block 2 of the original Industrial Park plat which belongs to the Hooleys - in Outlot A there is portion of it that would be included in this service area to be served off of Curvecrest Blvd. They proposed to connect the sewer at an existing stub that was installed when Washington Avenue was built and the sewer would then go in this direction (indicated on the map) and then additional services could be installed for the other lots. The same thing would apply on Tower Drive extended the sewer back to a certain point from an existing stub and the water - main likewise and this would include Lots 5 and 6 in Block 2. Since the petitioner does not own 1007 of the property and there will be a street constructed on this portion of Tower Drive, there will also be services installed for those two lots - it would require a public hearing - the cost for constructing the sanitary sewer on Curvecrest and Tower Drive and all of the services related within this area would be $46,905; the cost of the watermains - $95,305; streets - $187,055 and the total estimated construction cost would be $329,265. He further cited the assessment procedure for this project which were detailed in his written report. Curvecrest Blvd. is part of the Municipal State Aid System and there could be State Aid Funds applied against this segment and the estimated cost of this segment is $111,015 and if they applied the full amount of State Aid Funds available to construct this portion, and applied an even assessment over the total area for constructing both segments of the street it would amount to $5,940 per acre. The assessments for the other improvements for streets which is immediately adjacent to this improvement were kept at $4,300 per acre and this was possible through the use of State Aid Monies. The Council could consider a couple of alternatives in order to hold these street assessments at $4,300 per acre - some of this cost could be spread over the remainder of the state aid system on Curvecrest Blvd. which will be con- structed at a later date easterly on this area; however, they could consider an inflationery raise in the street assessment rate and apply a little more assessment to these parcels - an increase over the $4,300. COUNCILMAN ROGER PETERSON did not feel that we could possibly hold the assess- ments continually to $4,300 because inflation is just chewing that up and that part of that coat is going to have to be passed on to the developer and by using this $111,015 in State Aid Funds, it would then reduce the assessment to $5,940 per acre and felt that was a realistic figure. DICK MOORE stated that part of the problem is that this street construction is heavy sections and they are wide streets and they have concrete islands, etc. - there is a high cost and there is a small area to assess this to. The developer has not seen a copy of this report. There will be approximately $200,000 of State Aid monies for other streets within the City. On motion of Councilman Powell, seconded by Councilwoman Bodlovick, a resolution was introduced "ACCEPTING THE FEASBtILITY STUDY AND ORDERING A HEARING ON LOCAL IMPROVEMENT NO. 178" with the hearing date to be set for March 25, 1980 at 7:30 P. M. AYES -- Councilwoman Bodlovick, Councilmen H. Peterson, R. Peterson, Powell and Mayor Junker NAYS - -None (see resolutions) COUNCIL REOUEST ITEMS None QUESTIONS FROM PRESS REPRESENTATIVES None 57\\ • • • 1 7 • • 5 o February 25, 1980 O e APPROVAL OF MINUTES On motion of Councilman Powell, seconded by Councilwoman Bodlovick, minutes of the following meetings were approved: (all in favor) December 18, 1979 December 20, 1979 December 27, 1979 January 4, 1980 January 8, 1980 January 22, 1980 January 28, 1980 January 30, 1980 February 12, 1980 Regular Meeting Recessed Meeting Special Meeting Special Meeting Special Meeting Regular Meeting Regular Meeting Recessed Meeting Special Meeting Special Meeting Regular Meeting 4:00 P. M. 7:30 P. M. 4:00 P. M. 4:30 P. M. 4:30 P. M. 7:30 P. M. 4:00 P. M. 7:30 P. M. 4:30 P. M. 4:30 P. M. 7:30 P. M. MISCELLANEOUS Mr. Kriesel referred the Council to the report from Ron Langness of Springsted's regarding the Oak Glen Development for David S. Johnson - basically what Ron is saying here is that the City is going to have to sit back down and look at the whole development. MAYOR JUNKER felt that Springsteds still do not know how this was treated in the Comprehensive Plan and COUNCILWOMAN BODLOVICK stated that the one small item in the report was does this meet and fit into the City's Comprehensive Plan and what she really felt what he wanted the Council to be aware of is "Are you going to bank -roll and finance this or what are you going to do with it ?" and that is the number one question. This does fit in with the Comprehensive Plan. MAYOR JUNKER suggested that we set up a meeting and meet with him once again, and we would not have to have their attorneys - all that we would have to have is their attorney - we would not need the Dorsey firm. MR. KRIESEL stated that if there is something specific that we can have Ron Lang - ness work on. MR. MAGNUSON stated that Mr. Langness is just going to tell you what it says in this report - you have to see if it is legal to allow him to maintain all of those public funds for all of those years, using them for interest . . . COUNCILMAN POWELL asked would it be legal to have Mr. Johnson put up some money in escrow or on deposit or whatever to cover any eventuality that might take place - he was not sure that he would even consider doing that, but if we are talking about four to four and one -half million dollar improvement, it would seem to him that it would be proper for the City to ask him to put up at least three million or three and one -half million "front money" so that if things really went bad that he could cover the expenses to that the City wouldn't be held responsible. He could invest that money, it could be in trust so that it couldn't be withdrawn without both the City and he signing the withdrawal - that might be some way of doing it - what he is lookint to do is to get the improvements in at today's costs because he knows what they are going to be tomorrow and that would be a tremendous savings for him but by the same token and he did not feel that the City could stand to • ke that risk. MAYOR JUNKER asked Mr. Magnuson if it states that the City is taking a risk by funding the four million dollars worth of improvements. COUNCILWOMAN BODLOVICK, stated that he does not want to give the City the street assessments - he wants to retain those. MR. MAGNUSON stated that the big amount of the issue and the amount of debt that the City has to incur if they default and the other issue is now little we know about David S. Johnson except for what he has told us - we haven't seen a financial statement - really do not know what the corporation is worth and he doesn't want to guarantee the operation - we have asked him many, many times and he stated he won't do it because it will create tax problems for his corporation. MAYOR JUNKER asked if the City had ever asked him to guarantee the City three million dollars for the four million improvements and MR. MAGNUSON stated that we have asked him that and that was the whole point of the last meeting - if he guaranteed it, it would make his corporation what is called "under- capitalized" corporation which would cause tax problems. MAYOR JUNKER asked what the Council's feeling was on this - there is no sense delaying him and the Council spending any more time, if the Council doesn't feel that we should get into the business of our million dollars worth of sewer. tl 0 I f 1 r1 e • • • 1 • • • 0 r 0 February 25, 1980 COUNCILMAN POWELL stated that no one has ever asked the City to put in $4,500,000 worth of sewer at one time - when Orrin Thompson had it, it came in seven sections - he wants it in as one because he wants to save money - if he wants it in one, there should be money on deposit to take care of it - he did not feel that he has to have the full amount because he is going to sell some property; if he turns the assessments over to the City which he felt that Mr. Johnson should do, because the question is whether that is legal or not and then the rest of it he can pay 1/20 of it and then baloon it at the end of nine years because he has three or three and one - half million on deposit. Otherwise, the land is not worth it if it goes broke. MAYOR JUNKER felt that what the City should do, if the Council feels that we should, then we should tell Mr. Johnson that if we go four million dollars with sewer and water and street assessments, that we want every lot that is sold - we want the assessment money from that lot delivered to the City at that time COUNCILWOMAN BODLOVICK indicated that she would feel more comfortable if that situation was the way that it was going to be and that would be her only thoughts behind it - she didn't know anybody should collect assessments and collect assessments and collect interest on our money when we need it. We are bonding for it and there should be some front money. COUNCILMAN HARRY PETERSON stated that he still has a fear of his plan which is to develop the entire area with the plan to sell 400 homes with the oppor- tunity for him to sell this lot and that lot - it is true that he is going to get the big money for that, but he can sell of 20 lots and he can fold - he is scared to death of that - he has to be completely candid - this is not a plan that grabs him as something that he would want to put his money on and if he is on the Council representing the people of Stillwater, he does not want to put Stillwater's money on it either. As he sees it he wants a golf course, he wants to build a golf course and he is going to own that golf course and if the rest of it falls into place, fine, but if it doesn't, he is sitting there with a golf course - and he would say that Mr. Johnson would have to have at least half as front money. COUNCILMAN POWELL felt that the City should have 75% if we are going to lay out the whole thing, because if it is four and one -half million, 757. is better than 31 million. nobodyJwants stated that there is no the streets and thenutilitieseandnweashould meeting just tell him what we want. He did not know how much he has ever bank - rolled anybody for these assessments. MR. KRIESEL stated that possibly the Industrial Park since Orrin Thompson was never that much and it was done on a three year basis. MAYOR JUNKER asked the Council how they would feel, if David Johnson would guarantee the City two million dollars and every home that was sold, that the City take the assessments. COUNCILMAN ROGER PETERSON felt that it should be at least 1007. or more as we did with Orrin Thompson who paid 125% and the extra applied to remaining balance. COUNCILMAN POWELL did not feel that two million is enough - that the City could still be in debt for two million dollars. MAYOR JUNKER stated that if he is going to spend a million two hundred thousand for the land, the City would have to consider that. COUNCILMAN ROGER PETERSON stated that if he cannot sell the land, neither can the City. COUNCILMAN POWELL stated that the bond payments are going to be $500,000 per year in the statement. COUNCILWOMAN BODLOVICK asked Mr. Magnuson how much detailed financing information for we can ask for a from all M of N his Nfinancialh ask backers, his corporation . . . . COUNCILMAN ROGER PETERSON stated that his assets are not tied up in that corporation, you can bet on that. MR. MAGNUSstted that a they and that Council guarantee COUNCILMAN ROGER PETERSON felt that the City has to have his personal and individual guarantee - the corporation probably has no assets to speak of other than the land the land is not any good to the City. There was no corporation involved with the Kerns - it was the individuals that were involved there. • • a • • c • • ORDINANCES FEBRUARY 25, 1980 COUNCILMAN POWELL stated that the thing that was done there was to allow a twenty year maturity on the bonds - Bud Kern individually, Bill Pauley em individually, etc. COUNCILWOMAN BODLOVICK stated that a corporation means nothing - all you can get are the assets of the corporation. MR. MAGNUSON stated that Kern and Pauley are not obligated personally either - the only security that the City has is the land if they don't pay - the distinction in that case the City a long time ago committed to the Industrial Park as being the savior to the City as far as the tax base and there was a feeling of promotion of growth out there. MAYOR JUNKER did not feel that there was any difference, but we should tell Mr. Johnson that he has to guarantee the City a certain amount of money. COUNCILMAN HARRY PETERSON questioned what we know about David 5. Johnson who supposedly made millions - he wants to come in with a big development - he is talking $7,000,000 and yet he is not talking about up -front money of more than $300,000. MAYOR JUNKER stated that he has $500,000 in land and he owes $700,000 more which he would pay off immedaitely when it is developed. COUNCILMAN HARRY PETERSON felt that we are looking at a guy who does not have a lot of money and he wants the City to do his bank - rolling - if he has that "dough" out there, and this is such a good project and it can go why doesn't he bring it out himself and say "okay" you go for four million and I will lay two million on the line as up -front money. He would go for half of what the City has to put into it. COUNCILMAN POWELL felt that if the City want to a joint account with cash on deposit and the interest was his, all he would be doing would be putting put the money because the interest would probably off -set itself. MR. MAGNUSON stated that if there is ay sort of default or forfeiture, the City could pick this up COUNCILMAN POWELL asked Mr. Magnuson if it was illegal for him to keep the assess- ment money if he keeps the assessments paid up every year and he has front - money. MR. MAGNUSON stated that Mr. Langness questions if it is legal and he would have to do some research on it -- J COUNCILMAN POWELL stated that he would like to see the project go if the City is protected. COUNCILMAN ROGER PETERSON felt that the escrow should be for fifty percent of whatever the cost is going to be, and the rest of the Council concurred with the exception of Councilman Powell who did not feel that was enough. MAYOR JUNKER asked what else does the City want and the response was that when the lots are sold he should pay the assessments and more than a corporate guarantee which is nothing. MAYOR JUNKER asked if the City would be willing to back the golf course for three million dollars in federal revenue bonds - (Industrial Revenue Bonds). MR. MAGNUSON stated that there are some restrictions as to what they will sell revenue bonds for and if it is legal, then it would be the Council's decision if they wanted to do that. MR. KRIESEL stated that there is legislation in the works for this type of financing. The final decision was that the City wants fifty percent of the total cost of the improvements and the assessment paid upon the sale of the lots and get his personal guarantee. Second Reading - Ordinance No. 581 - Codifying of the Ordinances oat to • • • • • t 1 rs • • A February 25, 1980 r • RESOLUTIONS The following resolutions were read and an roll call were unanimously adopted: 1. Directing the Payment of the Bills. 2. Vacation of Oakes and Oak Streets. 3. Employment of Allen Zepper as Building Official 4. For $50,000 Bonding for Local Improvement No. 177 - Burlington Northern Structure. 5. Improvement Hearing for Kern- Pauley - Local Improvement No. 178 ADJOURNMENT On motion of Councilman Powell, seconded by Councilman Roger Peterson, the meeting adjourned at 8:50 P. M. Attest: a .e. ,'�" 1 P'f City Clerk Mayor 61 • 9 • • 1