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HomeMy WebLinkAbout2017-10-17 CC MINThe Birthplace of Minnesota ter 216 4th Street N, Stillwater, MN 55082 651-430-8800 www.ci.stillwater.mn.us CITY COUNCIL MEETING MINUTES October 17, 2017 REGULAR MEETING 6:30 P.M. Mayor Kozlowski called the meeting to order at 6:35 p.m. Present: Mayor Kozlowski, Councilmembers Menikheim, Weidner and Polehna Absent: Councilmember Junker Staff present: City Administrator McCarty City Attorney Magnuson Police Chief Gannaway Community Development Director Turnblad Finance Director Harrison Public Works Director Sanders Engineering Secretary Wolf PLEDGE OF ALLEGIANCE Mayor Kozlowski led the Council and audience in the Pledge of Allegiance. TOUR OF POLICE DEPARTMENT Motion by Councilmember Weidner, seconded by Councilmember Polehna, to adjourn the meeting at 6:36 p.m. to tour the Police Department. All in favor. Mayor Kozlowski reconvened the meeting at 7:08 p.m. APPROVAL OF MINUTES Possible approval of minutes of October 3, 2017 regular and recessed meeting. Motion by Councilmember Weidner, seconded by Councilmember Menikheim, to approve the October 3, 2017 regular and recessed meeting minutes. All in favor. PETITIONS, INDIVIDUALS, DELEGATIONS & COMMENDATIONS Greater Stillwater Area Chamber of Commerce — Robin Anthonv Robin Anthony, Executive Director of the Greater Stillwater Area Chamber of Commerce, reported on the activities, programs and goals of the Chamber. OPEN FORUM There were no public comments. City Council Meeting October 17, 2017 STAFF REPORTS Community Development Director Turnblad indicated that the University of Minnesota/ Minnesota Department of Transportation annual workshop is being held in Stillwater, using Main Street as a case study. City Administrator McCarty informed the Council that State legislators met with City officials yesterday about funding for St. Croix riverbank stabilization. He reminded the Council of the November 29 League of Minnesota Cities annual meeting; October 25 Dementia Friendly work training sessions; and a Clean Energy event series October 29 and November 12. CONSENT AGENDA Resolution 2017-204, directing payment of bills Resolution 2017-205, approval of agreement with SafeAssure Consultant, Inc. for OSHA and Safety Consultation Resolution 2017-206, approving assignment agreement with the Veterans Memorial Committee for 2018 Resolution 2017-207, approval of Changer Order #2 for 2016 Street Improvement Project (Project 2016-02) Possible approval of quote for security improvements for Public Works facility Resolution 2017-208, approval of dental and health insurance rates for 2018 Possible approval of gate purchase for Public Works Possible approval to purchase camera license upgrades for Fire Department, Recreation Center and Lily Lake Arena Possible approval of utility bill adjustments Possible approval of temporary liquor license — Washington County — Christmas at the Courthouse Resolution 2017-209, resolution supporting St. Croix Riverbank Restoration Project in the City of Stillwater Motion by Councilmember Polehna, seconded by Councilmember Weidner, to adopt the Consent Agenda. Ayes: Councilmembers Menikheim, Weidner, Polehna, Mayor Kozlowski Nays: None PUBLIC HEARINGS A public hearing for the assessments associated with the 2017 Street Improvement Project (Project 2017-02). Public Works Director Sanders explained that the 2017 street improvement project is near completion. The bid came in about 15% lower than estimated, which will result in lower assessment rates. During construction, Brick, Seeley and Hemlock Streets were changed from a partial reconstruction to full reconstruct due to the pavement being worse than anticipated. The final construction cost of the project is estimated to be $1,524,333.30 and the total project is estimated to be $1,780,358.05. Properties in the project area will be assessed according to the following percentages: street reconstruction, 70%; mill and overlay, 80%; water and sanitary sewer replacement, 100%. The balance of an assessment after November 18 will be put on Page 2 of 7 City Council Meeting October 17, 2017 property taxes to be paid over a 10-year period at 4% interest rate. It may be paid off any time in that 10-year period. A total of 4.25 miles of streets were improved, involving 350 properties. Mr. Sanders further stated that 20+ objections were received from property owners. Property owners may appeal to District Court. State law and City Code allow for deferred assessments for homestead property owned by persons 65 or older. He added that Stillwater Country Club is not receiving an assessment because staff did not feel the cost of the assessment would benefit the golf course. Individual assessments are not increased because the golf course is not being assessed - the amount shows up in the City contribution to the project. Mayor Kozlowski asked how it is decided whether to replace a water service, and Public Works Director Sanders answered that the Water Board has a list of properties that still have galvanized water services, which tend to leak. Staff feels that street reconstruction is a good time to replace galvanized services. On a question by Mayor Kozlowski about the change in assessments for streets that were changed from partial to full reconstruction, Mr. Sanders replied that the assessments for those properties went from $5,600 to $7,200. Mayor Kozlowski asked Mr. Sanders to explain assessment rates for State Aid roads, and Mr. Sanders responded that homeowners on State Aid streets are charged at a lower percentage (50%) due to heavier traffic, making those streets deteriorate faster. Mayor Kozlowski opened public hearing. Alan Kantrud, attorney, indicated that he was asked by several residents on Moore Street to speak on their behalf. He told the Council that assigning a 70/30 split in terms of cost for these projects is by definition, arbitrary because the City may only assess an amount equal to the benefit conferred. His second objection is having the City pick up the golf course assessment, which he asserted is also arbitrary. His third objection is to the project itself. Assessing per unit makes sense, but those whose curb and gutter is not replaced should not be assessed the same amount as those whose curb and gutter is replaced. Jim Markall, 1336 Surrey Lane, expressed concern about the Benson Addition mill and overlay. He asked what will happen next year when the cracks reappear like they did in the section that was done last year; and Public Works Director Sanders answered that as a flexible pavement, asphalt will crack. Next year, the City will do crack sealing. The City stopped its sealcoating program in 2012 when it became apparent that a chemical reaction between the asphalt and the sealcoat was causing stripping of the top layer of asphalt. Jeanette Nelson, who owns property at 1325-27 South Sixth Street, voiced that the project did not benefit her because the old curb was not worn out. She would like a reduction in her assessment. She suggested the City repair Curve Crest Boulevard which is in very poor shape. Frances Myran stated she and her husband did not know they were getting assessed for their property at 1521 Olive Street West. They sold the property in July, so they paid $3,500 for a street they do not use. Public Works Director Sanders responded that neighborhood meetings were held during the last part of 2016, and notices went out in February for the public hearing on the project in March. Jan Wheeler, 320 South Brick Street, referred to a notice that stated the project would increase the valuation of her property. She asked the Council how that can be, since it is a street. City Attorney Magnuson responded that this year there were no separate appraisals done on any of the Page 3 of 7 City Council Meeting October 17, 2017 parcels in the project, partially because the City has done 4-5 appraisals every year for the last 4- 5 years. The projects are similar, the values are similar and the appraisers routinely give the opinion that the market value of the homes is increased at least by the value of the assessment. Ms. Wheeler inquired why she should receive a double assessment for living on the corner. Mr. Sanders replied that corner lots are assessed for a half a unit for each side improved. In the future when Olive Street is improved, Ms. Wheeler will get a half unit assessment for Olive. Roxanne Olson, 403 Hemlock Street South, stated she just has front footage but is being assessed the same as a corner lot. There is no street between her and her neighbor. She questioned how the property value of individual homeowners could increase but not that of the golf course; Mr. Magnuson replied that the appraiser was asked whether he thought the value of the golf course would be increased, based on its use as a golf course. The appraiser stated he knew of no precedent that would sustain an assessment to the golf course. Carol Gapen, 215 Moore Street West, asked that her two letters of objection be included in the Council's deliberation. She feels that City Attorney Magnuson is misinterpreting the Supreme Court case. Don Loida, 1705 Oak Street West, expressed that nothing has been done to the street in 30 years and now he gets a huge assessment. He feels he paid taxes to have the street maintained. He would like to know why his neighbor, who drives big trucks that deteriorate the road, is not assessed more. Monica Jones, 410 Hemlock Street South, asked why the water service assessments increased; and Mr. Sanders answered that the bids came in with a cost that was higher than estimated. The cost relates to economy of scale. Last year, 16 water services were replaced, but only five this year, so the price went up. Kalen Danley, 1221 Olive Street West, informed Council that he had some curb and gutter replaced on his driveway that had nothing wrong with it. He questioned why he was being assessed the same as someone who had complete curb and gutter replaced; and Mr. Sanders responded that staff and the contractor must determine if the gutter has adequate drainage for runoff, and that in a lot of instances on this project, the curb and driveway were integral with each other. He offered to meet with the homeowner to look at his property. Terry Hatchitt, 1619 Oak Street West, pointed out that in a four-year period, there have been three watermain breaks in that block. The company that paved did a great job, but the company that did the patching did shoddy work; and Mr. Sanders remarked that the Water Board is a separate entity from the City. They are responsible for the hiring the contractors to repair the watermain breaks. Ryan Bastyr, 1706 Oak Street West, stated the contractor did a great job with the asphalt, but he feels the costs are too high and that the City is not allowing for any middle ground with varying assessments. Mr. Sanders explained that Mr. Bastyr' s property was part of the section that went from partial to full reconstruction. When the feasibility study was done, they did one boring on every block. This indicated a thin pavement section but 12" of aggregate underneath. However as the project got going and the contractor stated removing asphalt, it was discovered that the entire section did not have 12" of aggregate under the pavement. So the contractor had to place 6" of gravel, 4" of pavement on those sections, and also had to do some subgrade in some sections. A resident who did not identify himself asked how the City determined 4% interest. Finance Director Harrison replied that the interest rate was determined by the City a long time ago by Page 4 of 7 City Council Meeting October 17, 2017 adding 1% to the bond interest rate. Typically the City has been receiving about a 3% bond issue rate. LaRae Stiner, 1611 West Oak Street, indicated that her curb and gutter were not replaced, but she received the same assessment as everyone else. She questioned the total project cost and the total assessment amount versus the number of property owners being assessed. Public Works Director Sanders invited her to call him to go over the numbers. Geoff Crandall, 417 Moore Street, asked about a long pipe that was on Moore Street. Mr. Sanders explained that the Water Board had a separate project to connect the watermains on Williams and Poplar through the golf course. There were no service connections involved. Mr. Crandall asked if the residents are paying for the curbs on the golf course side. Mr. Sanders replied a catch basin was installed in a low area on Moore Street just west of Martha which made it necessary to raise the road up on the north side to get the curbs to match for better drainage. Mr. Crandall pointed out that at least 50% of the traffic on Moore Street is golf course traffic including delivery trucks. He feels the street project benefits the golf course. Mayor Kozlowski acknowledged that if Moore Street were not there, the golf course would lose significant value, but he added that the City Attorney, past history, and the appraiser all agree that the golf course should not be assessed. He mentioned that he wished the City did not have to assess property owners. Stillwater does not have the ability that larger cities do in looking at the minute details of every single assessment for every homeowner. Matt Olson, 1556 Driving Park Road, commented that if the Council is so offended by the golf course not getting assessed, then they should fix it. He also asked why the 1% is added to the assessment interest rate on top of the bond cost. Finance Director Harrison reiterated that adding 1% has been City policy since 1983 to cover administrative costs. Mayor Kozlowski closed public hearing. On a question by Mayor Kozlowski about why some curb and gutters were replaced and not others. Public Works Director answered that to keep overall project costs down, it was decided to replace only damaged curb. If property owners were to be assessed based on how much curb was done individually, it would take more computer time and staff time to figure that out. Councilmember Weidner inquired if existing curb and gutter fail, will the property owner be assessed again; and Mr. Sanders responded if a failure occurs before 20 years, they would not be assessed again. The City would tie the replacement cost into the operational budget. Mayor Kozlowski pointed out that he would not mind revisiting the assessment policy or considering other appraisers. There are pros and cons to how different cities handle assessments but there is no easy solution. Councilmember Polehna indicated that the City could not afford to pay 100% of the cost of street improvements. Lowering the assessment rate now would be unfair to residents who have been paying assessments for several years. Mayor Kozlowski asked if the Council could change the term to 15 years; and Ms. Harrison answered yes, the rate could be changed without affecting the bond rating. Councilmember Menikheim remarked that the larger problem is how to pay for streets. He inquired if it would be possible to make streets a line item budget and levy the whole City for all the streets. Page 5 of 7 City Council Meeting October 17, 2017 Councilmember Weidner acknowledged that the appeal process gives residents recourse which they would not have if the Council decided to do a blanket levy over the entire City. He urged property owners to take advantage of the appeal process if they do not feel their property has increased in value based on that amount. He would like to revisit the 1% interest rate. City Attorney Magnuson commented that there have been past projects with many appeals, for instance the South Hill project where assessments were $15,000 to $18,000. There are fewer appeals now because assessments are lower than they have been in the past. He explained the appeal process. On a question by Mayor Kozlowski if the Council should set a workshop to discuss the golf course, appraisals, and possibly doing different types of appraisals every year, Public Works Director Sanders responded that in future projects, staff could get 3-4 appraisals and look at getting different appraisers. Councilmember Menikheim stated he also wants to look at potential impacts of levying the cost of street work across the entire City. Motion by Councilmember Weidner, seconded by Councilmember Menikheim, to adopt Resolution 2017-210, resolution adopting assessments for the 2017 Street Improvement Project (Project 2017- 02), L.I. 413. Ayes: Councilmembers Menikheim, Weidner, Polehna, Mayor Kozlowski Nays: None UNFINISHED BUSINESS Stillwater Public Library Director Library Director Mark Troendle thanked the Council for welcoming him to the City. Possible approval of parking agreement with The Crosby Hotel City Attorney Magnuson explained the agreement memorializing public parking on the deck of the parking ramp that will be built by the developers of The Crosby Hotel. The agreement allows the developers to own, manage and maintain the public space, and to charge market rates for the public parking. Further, while some hotel and restaurant parking is allowed on the deck, it must not displace the public's use of the space. The developer is given the right to conduct events on the deck space, provided that an event permit is secured if needed, and the event use does not unreasonably displace the public parking. Lastly, the developers have agreed the public rights as outlined in the agreement are in perpetuity. The draft agreement was negotiated by City staff who recommend it for approval. Motion by Councilmember Polehna, seconded by Councilmember Weidner, to adopt Resolution 2017-211, resolution approving Parking Agreement with Midnight Real Estate Group, LLC (Crosby Hotel). Ayes: Councilmembers Menikheim, Weidner, Polehna, Mayor Kozlowski Nays: None Page 6 of 7 City Council Meeting October 17, 2017 NEW BUSINESS Discussion of sewer rate increase Finance Director Harrison led discussion of a possible sanitary sewer fund rate increase. The Met Council raises rates 3-4% every year and the City has not kept up. She added that during fiscal year 2016, the bottom line net loss was $344,000 and there are some major capital purchases coming in the near future. She explained three options for rate increases. Staff recommends Option 1. Motion by Councilmember Weidner, seconded by Councilmember Menikheim, to adopt Resolution 2017-212, resolution amending Resolution 2017-017, 2017 Fee Schedule. Ayes: Councilmembers Menikheim, Weidner, Polehna, Mayor Kozlowski Nays: None COMMUNICATIONS/REQUESTS There were no Communications/Requests. COUNCIL REQUEST ITEMS Councilmember Polehna reported that Beyond the Yellow Ribbon had a successful hunt for 100 troops just returned from Iraq and Afghanistan. Another hunt is set for December 2. ADJOURNMENT Motion by Councilmember Polehna, seconded by Councilmember Menikheim, to adjourn the meeting at 9:34 p.m. All in favor. ATTEST: l(fividid /We PJ homas McCarty, Actin_l ity Clerk Ted ' oziowski, Mayor Resolution 2017-204, directing payment of bills Resolution 2017-205, approval of agreement with SafeAssure Consultant, Inc. for OSHA and Safety Consultation Resolution 2017-206, approving assignment agreement with the Veterans Memorial Committee for 2018 Resolution 2017-207, approval of Changer Order #2 for 2016 Street Improvement Project Resolution 2017-208, approval of dental and health insurance rates for 2018 Resolution 2017-209, resolution supporting St. Croix Riverbank Restoration Project in the City of Stillwater Resolution 2017-210, resolution adopting assessments for the 2017 Street Improvement Project (Project 2017-02), L.I. 413 Resolution 2017-211, resolution approving Parking Agreement with the Crosby Hotel Resolution 2017-212, resolution amending Resolution 2017-017, 2017 Fee Schedule Page 7 of 7