HomeMy WebLinkAbout2012-05-11 CC MIN Special MeetingitlAa ter
THE IINTOF IN INN EIOTF
CITY COUNCIL SPECIAL MEETING MINUTES
May 11, 2012
SPECIAL MEETING 8:00 A.M.
Mayor Harycki called the meeting to order at 8 a.m.
Present: Councilmembers Cook, Menikheim, Polehna, Roush and Mayor Harycki
Staff present: City Administrator Hansen
City Attorney Magnuson
Community Development Director Turnblad
Finance Director Harrison
Fire Chief Glaser
Police Chief Gannaway
Public Works Director Sanders
City Clerk Ward
PREVIOUS RETREATS AND PROGRESS
City Administrator Hansen reviewed priorities /issues from previous retreats and the progress
made as a result, which included: from the 2009 retreat, the Public Works Department is
more professional and efficient; cooperation with Washington County and School District
834 has been increased; improved efforts on staff reports, energy audit, disposal of the
Cayuga, and consideration of a dog park; from 2010, flood control options; Lowell Park
improvements; boat launch; armory; contracts rebidded; problem properties addressed;
increased communication with the watershed districts; energy audit; economic development;
shared services study; gazebo; Dairy Queen take over the concessions at the Rec Center;
from 2011, benchmarking; personnel policy changes; promotion of volunteerism; purchasing
policy revision; transfer of TIF funds to parking ramp debt service; rental agreement for the
Cayuga property.
It was requested that City Administrator Hansen circulate a list of contracts that will be bid to
determine if neighboring communities — Stillwater Township, Grant, Oak Park Heights, etc.
— would be interested in piggybacking on those contracts.
FIRE STATION /ARMORY /GYMNASIUM
Gymnasium
City Administrator Hansen reported that a tax impact study had been done for all the pending
projects. He reviewed estimated tax impact on homes of various values for the gymnasium
project and fire station.
City Council Special Meeting
May 11, 2012
Councilmember Roush indicated that it was his understanding the gymnasium project would
be privately funded, and it was noted that is the hope, but there are no guarantees regarding
the amount of support. Like the Rec Center, the gymnasium would be the City's liability
through general obligation bonds.
Councilmember Polehna stated he has been talking with communities throughout the area to
solicit support for the effort, specifically requests for a commitment to pay a portion of the
debt service for a number of years. Councilmember Polehna also spoke of the revenue stream
that will be generated in court fees /rentals to offset the debt service.
City Administrator Hansen pointed out that decisions regarding whether to proceed with the
gymnasium project will need to be made soon.
Community Development Director Turnblad noted that a joint use agreement still has to be
put together with the National Guard, and he that while revenue from the second/expanded
gymnasium could be obligation for debt service, some of the money from the facility paid for
by the National Guard will go directly to the Guard. There was discussion about the impact
of the Guard's use of the facility two weekends a month and whether the Guard would be
utilizing the entire gymnasium space on those weekends.
Councilmember Cook voiced that this is information that needs to be known before any
decisions are made as to whether to proceed with the second gymnasium.
On a question by Councilmember Cook, there was discussion of other armory facilities
where there are cooperative ventures with host cities. It was noted that in Inver Grove
Heights, the only program in the red is the water park area, with all others running in the
black. It was also noted that Inver Grove does not have an expanded gymnasium facility.
There was discussion of the proposed size of 19,000 square feet and the reason for that size.
It was noted the facility could also be rented for craft, antique, gun shows and similar
activities.
Councilmember Cook asked the question of who would get the rental money. Mr. Turnblad
responded that the Guard would be responsible for scheduling the rentals.
Councilmember Polehna pointed out that if need be, some of the scheduling could be taken
over by the Rec Center.
Mayor Harycki indicated that according to the figures provided by finance, debt service
would amount to $15,700 a month, and suggested it would also be good to get some
information about operating costs for such facilities, as well as typical rental fees.
Councilmember Roush inquired about the likelihood of other communities participation, and
Councilmember Polehna replied those that he has talked with have indicated support.
Mayor Harycki estimated it might require that the courts be rented 224 hours a month in
order to break even, and requested contacting Doug Brady from the Rec Center regarding
rental hours of the two ice sheets.
Mayor Harycki requested that Mr. Turnblad talk with Col. Jensen in an effort to answer some
of the questions about what a joint use agreement might look like, as well as contact Doug
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May 11, 2012
Brady regarding rental times. Mr. Turnblad responded that staff could probably put together
an estimate of operational costs and revenue.
Mayor Harycki continued that the Council will have to determine a "comfort level" for
subsidizing such a facility if all debt and operating costs can't be covered by rental fees. City
Administrator Hansen pointed out that these types of amenities do not pay for themselves — if
they did, the private sector would build them.
There was discussion about the new municipal recreation center in Vadnais Heights. It was
noted that much of that facility is underused and therefore does not generate the rental fees
that the City had hoped for.
Mr. Turnblad stated that after office hours National Guard personnel would not be able to
staff the facility. Consequently, the rental fees would have to cover the costs of renting the
gymnasium and paying wages for someone to staff the facility after office hours.
There was discussion about a facility at Vadnais Heights where the dome collapsed, and it
was noted that there will have to be somebody on site when the facility is used after hours.
Mr. Turnblad added that the City of Vadnais Heights cannot cover the cost of construction of
their facility because there is too much unrented space.
Councilmember Polehna stated that he could get some more definitive numbers regarding
rental costs and inventory of facilities.
Community Development Director Turnblad noted that due to the National Guard's
timetable, a decision on whether to proceed with 35% of the design for the expanded
gymnasium will have to be made within 3 -4 weeks.
Councilmember Cook expressed that she didn't have a sense of whether this is what the
greater community wants, or whether it is something that is wanted by a finite group. She
noted that taxpayers weren't even willing to pass the school tax referendum.
Councilmember Menikheim thought this was more than an amenity, it meets a need for such
facilities, and Councilmember Polehna referred to a survey done by the Chamber that
indicates people want a community center.
In discussion, it was noted that debt service costs will be going down in 2012 and 2014 that
could offset future debt service costs. There was discussion of the City's status regarding
debt service/bonding.
City Administrator Hansen cautioned the Council that the City is in danger of having a very
high tax rate, and noted the City has little debt expiring. He stated the point of having a 5-
year capital improvement plan is to time projects to occur when other debt is expiring. Mr.
Hansen noted that the gymnasium and fire station would increase the tax rate by 3.6 %.
Mayor Harycki pointed out that there would be some debts retired before ground would be
broken for these projects. Mr. Hansen indicated that the strategy of not selling bonds to get
through the state budget crisis is not sustainable, and the City will need to bond for capital
equipment at least every other year in the future. He also noted that the City isn't
experiencing the growth it did in the past that helped offset the tax rate.
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Councilmember Polehna talked about the expected growth/development in the City in the
next several years.
Mayor Harycki indicated that he preferred to consider total spending versus tax rate, and
noted that it is difficult to compare tax rates due to factors such as libraries and TIF districts.
Councilmember Menikheim asserted that the bottom line is whether people are willing to
have taxes raised in order to do these projects.
Councilmember Cook expressed that she would feel comfortable telling people taxes will be
raised for a central service, such as a fire station, but would not feel comfortable raising taxes
for an amenity, such as a gymnasium.
City Administrator Hansen described that under existing law, it is possible to build anything
the Council wants - the question becomes where to find the money to operate the facilities.
Councilmember Polehna stated that is the impetus for being creative in the operation of the
facilities.
Fire Station
On a question by Mayor Harycki, Community Development Director Turnblad answered that
nothing more will be known regarding potential costs until design work is initiated. He
explained that the National Guard has selected its design team, but the fire station is not
included in that contract. Mr. Turnblad suggested that if the decision is made to build
sometime in the near future, it makes sense to go with the design team in place due to cost
savings. He also indicated that if the decision is made to proceed with the design and then
decide not to actually construct the facility, that is a waste of money because the next design
team won't be able to use the previous work.
City Administrator Hansen agreed with that analysis and indicated it would be his
recommendation that if the Council decides to proceed with the 35% design phase, it makes
the decision to build the facility.
In discussion, Mayor Harycki suggested there are two departments involved here: fire and
police departments, and spoke to the current cramped working conditions in the police
department, as well as the fire station.
Councilmember Menikheim echoed those comments and also spoke of the need to construct
a new facility large enough to accommodate future expansion needs.
Mayor Harycki noted there would be costs associated with remodeling the current fire /police
quarters, which need to be considered.
Chief Gannaway talked about some of the changes that he would like to see made to the
existing facility.
Mr. Turnblad noted there is more leeway in the timetable for making a decision on whether
to proceed with the design for the fire station — the design decision for the gymnasium must
be made in 3 -4 weeks, but the decision for the fire station is not as critical as the design must
that facility could be done independent of the National Guard. Mr. Turnblad pointed out the
cost for participating in the design with the Guard will be 13% or about $800,000 and that he
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believes the City could realize some cost savings by doing the design independent of the
Guard. He did note that the Guard's fee does include some actual construction costs.
Councilmember Cook asked whether the City would have to build to the Guard's silver
standards, and Mr. Turnblad answered in the negative.
Councilmember Cook inquired about the proposal to have a substation at the existing fire
station, and referred to comments made during the public open house. Chief Glaser
responded that was a policy decision for the Council.
Mayor Harycki stated that he did not want to go down the path of having a dual station. He
noted there already is a truck stationed at the old public works facility behind City Hall
which could be utilized.
Councilmember Cook expressed that she thought it critical to have a fire presence remain in
the historic downtown area and in proximity to the river for water rescue. There was
discussion as to what might need to be done to the old public works building to make that
usable.
Mayor Harycki referred to the financial information, and noted that debt service would
amount to $416,000 a year, $45 on a home valued at $200,000. He indicated that the Council
has two decisions: whether to proceed with the design and, if so, whether to utilize the
Guard's design team.
Councilmember Menikheim spoke in favor of proceeding, and referred to the potential for
growth of the City, the professional opinion regarding the need and the cost effectiveness of
the project.
Mayor Harycki mentioned that for both the gymnasium and fire station the tax increase on a
home valued at $200,000 would be $65 a year. He inquired if that represented the total cost,
such as road work, and Mr. Turnblad provided estimates for the required intersection
reconstructions. City Attorney Magnuson pointed out that those costs could be included in
the overall bonding for the project.
Mayor Harycki noted the City would be responsible for the intersection work regardless of
whether it proceeds with the fire station/gymnasium projects. Mayor Harycki then spoke of
the opportunity presented and stated he would be willing to proceed with a worst -case
scenario of about $65 on a $200,000 house.
Councilmember Menikheim reiterated the added value to the community of having these
facilities.
Councilmember Roush noted costs will only increase in the future.
Mayor Harycki also spoke in favor of proceeding with the National Guard's design team. He
asked Mr. Turnblad how much input the City would have in the design process, and Mr.
Turnblad responded that the City would have input both in the Guard's design process and in
the City's own special use permit process.
Councilmember Cook inquired if there would still be opportunities for reducing costs if it
decides to proceed with the design, Chief Glaser answered that would absolutely be the case
and noted that he is very sensitive to the cost concerns.
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Councilmember Polehna expressed concern about one of the design team firms selected by
the Guard. Mr. Hansen spoke of the importance of having a construction manager for the
proj ect.
Councilmember Cook spoke of the initial discussions of cost savings by having the fire
station co- located with the Armory, and that she didn't think that has turned out to be the
case. Fire Chief Glaser stated it would be difficult to quantify the savings at this point, until
the overall scope of the project is known.
Councilmember Roush remarked that it would be more expensive to build a station
independent of the armory. He agreed there are some add -on costs that offset the savings,
but the savings are still there.
Mayor Harycki reiterated that the project will benefit both the fire and police departments,
and suggested the opportunities, including available sites, won't be available in 10 years.
Councilmember Cook spoke of the additional cost to improve the former public works
building to accommodate a downtown fire presence, and Chief Glaser pointed out if the
decision is made to keep a downtown presence, that may result in some savings at the new
station, information that is not known at this time.
In discussion, it was also mentioned that some of the work at the public works building
would have to be done in any event.
A 10- minute recess was taken, with Mayor Harycki reconvening the session at 10:34 a.m.
It was decided to take an official vote on whether to proceed at the next regular Council
meeting.
There was discussion as to what construction standards to follow.
Councilmember Roush suggested this is an issue of pay now or pay later; he noted a project
can be constructed to the LEED standard, but there is an additional cost to have it LEED
certified, which wouldn't have to be done. Councilmember Roush indicated he thought there
was an advantage to building to that standard because of future savings in operational and
maintenance costs
Motion by Councilmember Roush, seconded by Mayor Harycki, pending an official vote on
proceeding with the design, to build to the LEED silver standard, but not have it certified.
Councilmember Polehna mentioned that he was not aware of all the silver standards entailed,
and Mayor Harycki responded that he thought the standard should be followed to the extent
possible, where energy savings can be incorporated and there is a payback.
Councilmember Cook voiced that she would like a vote on this issue in a more public forum
as well, explaining the decision on record with an explanation of what the LEED standard
entails and what might or might not be included.
Councilmember Roush and Mayor Harycki rescinded the motion and second.
In additional discussion, Mayor Harycki wanted a decision on the gymnasium, but felt there
was information missing for a decision to be made at the next Council meeting.
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Councilmember Polehna remarked that he would try to get some additional information put
together.
Mayor Harycki requested that a resolution be prepared approving the design fees for the fire
station for a vote at the next Council meeting, and suggested that pending the vote on
proceeding with design for the fire station, there should be some action to begin the process
for moving forward with improvements /reconfiguration of the police department space.
In discussion, it was suggested that action should be a motion directing staff to begin an RFP
or similar process.
Councilmember Menikheim inquired if improvements to the old public works facility for
possible use as a fire substation should be included, and Councilmember Cook indicated that
would be critical to how she votes on proceeding with a new station. Mr. Turnblad answered
that he thought those two items could be included in one RFP.
STREETS
City Administrator Hansen asserted that the City's current practice of funding street
improvements is not sustainable. He reported that the 2012 project will pretty much exhaust
the current method of funding. He noted that several years ago, he had prepared a possible
change in the City's assessment policy, going from a 50% share of costs to a 75% cost to
citizens, a change that wasn't liked by anyone. He pointed out that if the Council wants to
continue the current assessment policy, through creative use of TIF and state -aid funds, the
City might be able to do 2 or 3 more additional street projects, and then those sources would
be gone. The financial data provided, he explained, shows the impact of doing a $1 million
project every year for 10 years. The example provided that the owner of a $250,000 home
would pay an additional $176.40 in taxes.
Councilmember Cook thought, if asked, street improvement projects would be something
that citizens would favor, and later noted that the infrastructure impacts economic
development.
City Attorney Magnuson pointed out that years ago, the City assessed 100% of improvement
costs to residents, and added one option is to have residents assessed more.
Mayor Harycki offered that the City should incorporate the County's plans into its
improvement schedule and perhaps scale back its project in years when the County will be
doing work in the City. Public Works Director Sanders enumerated upcoming County
projects. Mr. Sanders also noted that residents can be assessed when state -aid projects are
done, which reduces overall cost to the City for those projects.
Mr. Hansen concluded that the City can continue the current process for 2 or 3 more years,
after which time, he will be back to the Council to implement the bonding method- of
financing street projects.
Mr. Sanders also talked about the potential for using TIF funds for improvements projects in
TIF districts, and Mr. Magnuson continued about the possibility of amending soon to expire
TIF district boundaries to be citywide so the surplus funds could be used for street projects.
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Mr. Turnblad pointed out that the intent of TIF is for economic development/redevelopment,
and if used for streets it is like spending capital funds in operations.
Councilmember Cook requested that perhaps a portion of the TIF funding could be used for
streets in the downtown. Mr. Hansen added, philosophically, he agreed with Mr. Turnblad's
position, but perhaps using TIF is something the City will have to do. Regarding the proposal
to bond for street projects versus using TIF, Councilmember Cook remarked that she didn't
think people would mind half as much having $17 added to their tax bill for 10 years, as they
will about a gymnasium and possibly a fire station at double that amount for 20 or 25 years.
Mayor Harycki spoke in favor of utilizing the surplus TIF funds to continue the street
improvement schedule.
On a question by Councilmember Cook, Mr. Hansen replied that the original intent of TIF
was for economic development and use for street improvements deviates from that, but if it is
legal and it's the only way a street project can be done, he would support that use.
Councilmember Cook stated that she would want to be sure the use for streets is legal and
also that the City isn't using these [TIF] funds that could be used for certain other projects
the City might not be able to fund from any other source. Mr. Magnuson talked about the
original intent of TIF and some of the uses that are allowed. Councilmember Cook talked
about the possibility of using the funds in some way on the Brown's Creek trail.
Councilmember Menikheim suggested that road projects are more of a maintenance issue,
while economic development is the future, and he mentioned the possibility of acquiring the
depot. Later in the discussion, Mr. Magnuson explained that would be a legal use if the
building was used as a visitor center, for example.
Mayor Harycki asserted that he wants to continue working on the street improvement
schedule and suggested getting an opinion from the auditor about the legal issues.
Councilmember Menikheim noted that he would be OK with using a portion of the TIF for
street projects, but not all of it, preferring that it be spent on economic development.
Mayor Harycki added that if a portion of the TIF funds are used for street projects and -we
continued with our pavement management plan, it would extend the street repairs 5 -6 years,
and beyond that the City could capture the savings from retired debt service that may
eliminate the need for bonding.
There was additional discussion about the use of TIF for the Brown's Creek trail and
use /acquisition of the depot building.
SPECIAL EVENTS
Mayor Harycki reported that someone would be at the next Council meeting with an event
proposal.
Councilmember Polehna talked about the increasing number of requests for race - related
events and that he had tried to get a copy of the Minneapolis policy that, supposedly, is an
impetus for moving a lot of the events from that locale.
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Mr. Turnblad explained that the City of Minneapolis' policy is certain routes can only be
used a certain number of times a year, so that one neighborhood doesn't bear the burden for
all the events.
Mayor Harycki questioned how the City can pick and choose between promoters.
Councilmember Cook suggested that the City should determine what it wants, decide, for
example, how many races a year it wants and then submit RFPs. She added that part of the
special events task force was the promise to have a discussion with the community about the
vision for special events.
Mayor Harycki suggested starting with community focus group.
Councilmember Menikheim suggested there needs to be an overall policy that protects the
interests of the community as well as City staff. He also spoke of the public's desire for a
community celebration to replace Lumberjack Days and suggested that is where a
community focus group should play a part.
Chief Gannaway offered that the City should have a set policy where some requests will be
denied, or reach the point where it will need to have an event planner /coordinator. Chief
Gannaway pointed out that with a focus group everyone will have a different idea of what is
wanted and the process could take a long time, he suggested putting a sunset time on any
group.
Councilmember Polehna recommended doing a survey to determine public interest.
Councilmember Menikheim proposed that the Council could find a balanced group of
individuals to meet as a focus group. There was discussion of possible composition of a focus
group.
Mayor Harycki offered having a special Council meeting as an open forum to get feedback.
Councilmember Polehna suggested inserting a survey form in utility bills, and Mr. Hansen
raised a concern about staff having to prepare the survey questions, and Clerk Ward noted
she will be utilizing utility bill mailings for election information.
After discussion, it was decided to get a cost estimate from Readex to do a survey, and
Councilmember Menikheim suggested having a special Council meeting along with the
survey. It also was decided to keep the survey focused on the issue of special events and to
schedule a Council workshop to discuss survey results /input and make policy decisions.
There was a question as to whether the survey could be funded through TIF, and Mr.
Magnuson is to look into that issue.
OTHER ISSUES
Councilmember Menikheim submitted scheduling a workshop session prior to every Council
meeting. It was decided to schedule a workshop session at the second meeting in June to
discuss items remaining on the retreat agenda.
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City Council Special Meeting
ADJOURNMENT
May 11, 2012
Motion by Councilmember Roush, seconded by Councilmember Menikheim, to adjourn the
meeting at 11:50 a.m. All in favor.
ATTEST:
X.
Q��a � za*OK'
Diane F. Ward, City Clerk
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