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HomeMy WebLinkAbout2019-01-22 CC MIN ii 1water 216 4th Street N, Stillwater, MN 55082 \ 651-430-8800 The Birthplace of Minnesota J www.ci.sti11water.mn.us CITY COUNCIL MEETING MINUTES January 22, 2019 REGULAR MEETING 4:30 P.M. Mayor Kozlowski called the meeting to order at 4:30 p.m. Present: Mayor Kozlowski, Councilmembers Collins, Junker and Polehna Absent: Councilmember Weidner Staff present: City Administrator McCarty City Attorney Land Police Chief Gannaway Fire Chief Glaser Community Development Director Turnblad Public Works Director Sanders Finance Director Provos City Clerk Wolf OTHER BUSINESS Curve Crest Villas Proposed Sale /TIF#9 / Development Agreement Provisions City Administrator McCarty explained that the City and Curve Crest Villa Limited Partnership entered into a Development Agreement in 2002, for the development of Curve Crest Villas multi-family housing, located at the intersection of Orleans Street and Washington Avenue. Late last summer, the developer, Tim Nolde, approached the City regarding a proposed sale of Curve Crest Villas. Mr. Nolde requested that the City review the proposal and provide him with direction in regard to the sale provisions within the Development Agreement. In addition, the prospective buyer has brought forth some language that needs to be reviewed. City staff have been performing due diligence review of all the provisions of the Development Agreement. Staff has requested that the City's bond counsel review the proposed sale relative to the tax increment financing (TIF) note provisions included in the Development Agreement. Mr. Nolde stated that the housing was built in 2001 and opened in 2002.There are 90 units; 72 are considered affordable housing and will remain so until 2031. He added that the original Development Agreement stipulated that the sale of the development would generate revenue back to the City. The buyer needs that clause in the Development Agreement extinguished so if they sell it in another 20 years, they do not have to pay the City again. City Attorney Land stated she would not have interpreted the clause to mean the City receives revenue any time it is sold, but only with the initial sale by the original developer. The City invested a significant amount of sweat equity into the project. The clause ensured the City was made whole if the property was sold. City Council Meeting January 22, 2019 Mary Ippel, Briggs and Morgan, the City's bond counsel, reported that under TIF law, the development would have to comply with low and moderate income requirements for the 25-year life of the TIF note,which runs until 2029. She added that there are two notes held by two different banks. One of the things that must be determined is whether those two banks will be keeping those notes. Mr. Nolde pointed out that in October he submitted his analysis of what he thought he owed the City. His attorney has also done a detailed analysis. If HUD had not been shut down due to the present government shut-down, the deal would have fallen through. He would like the City to do the review and not just sit on it for nine months. He stated the Development Agreement says the City gets a certain share of the proceeds. The proceeds are based on what is left at the end of the sale. The partnership owes money to the banks under the TIF loans. The TIF stream would continue regardless of whether he pays those notes or not. City Attorney Land stated that the language says the distribution of the profits from a sale or refinancing will be controlled by the partnership agreement. The 80% share of the distribution due the general partner will be distributed 50% to the general partner, 50% to the City. The agreement is complicated and an auditor should review it to determine what the City is entitled to. City Administrator McCarty indicated that he would ask the City audit firm to look at the provisions and verify the numbers. He will share the information with Mr. Nolde and revisit the issue at the next Council meeting. Mayor Kozlowski stated he also would like a breakdown of the City's equity in the property at the time of the original sale of the property to Mr. Nolde. Planning Division Work Plan for 2019-2022 Community Development Director Turnblad led discussion of the Planning Division Work Plan and the major projects slated for 2019: a Sign Ordinance amendment; a lease agreement with MnDOT for Chestnut Street after it becomes a plaza; a riverwalk design; finishing the 2040 Comp Plan; a parking capacity study; a development plan for the Minar Neighborhood; and amendments to the Short Term Home Rental ordinance. Councilmember Polehna asked about Yard Parking; and Mr. Turnblad replied that Yard Parking is on the work list for 2019, but staff has not started working on it yet. On a question from Councilmember Junker about where the Aiple property and Bridgeview Park are on the priority list; Mr. Turnblad answered that the master park plan for the Aiple property is being done this year, and Bridgeview Park design and remodeling of the Bergstein buildings is slated for 2020. Councilmember Polehna suggested the City consider another park naming contest. He stated the City also should develop a master plan for the Rec Center. Mr. Turnblad responded that a master plan for the Rec Center is planned in 2020. He confirmed that if possible, the Council would like to move a master plan for the Rec Center into 2019. Page 2 of 8 City Council Meeting January 22, 2019 STAFF REPORTS Police Chief Gannaway informed the Council that in the span of two weekends, Stillwater had four opioid overdoses. One was a fatality. Without lifesaving measures by police and fire department personnel,two more of them would have been fatalities. He asked the public to help fight the opioid epidemic by knowing what their teenagers are doing, dropping off unused prescription drugs at the Washington County Sheriff's Department, and educating their youth about the problem. Community Development Director Turnblad updated the Council on the City Hall project. He reported that staff hopes to schedule interviews for the Zoning Administrator position next week. Public Works Director Sanders stated that 13 highway light poles downtown have been removed due to deterioration. Xcel Energy has identified 15 more that should be removed. The original lease agreement with Northern States Power, now Xcel Energy, expired two years ago. Xcel stated replacing the lights would cost the City $2,500 per light. The pedestrian lights, which were installed in 1999, are still under the lease/ownership of Xcel until 2024 or 2025. He provided a map showing locations of the lights. For the long term, the City will have to address downtown lighting because in another three to four years, the agreement with Xcel will expire and all the lights will belong to the City. Mr. Sanders added that he often fields a question about hanging flower baskets on the lights. Xcel has stated they will not allow hanging flower baskets on any of their poles. Councilmember Polehna would like the City to work with the Heritage Preservation Commission and Planning Commission to devise a light plan and consider a different style of lights than the shoebox lights. Mayor Kozlowski asked about the life span of the remaining lights; and Mr. Sanders predicted over the next few years there may be 8-10 more highway lights per year that deteriorate. The pedestrian light poles are not deteriorating because they are fiberglass. Xcel prefers not to have anything on their poles. The City owned the poles from 1991 to 1999 -that is the only reason they have the banners and Christmas lights on them now. Staff will meet with Xcel Energy on Friday to talk about the lighting. Council consensus was to approve the replacement of eight lights, at $2,500 per light, by Xcel Energy for a total of$18,000. City Administrator McCarty reminded the Council of the League of Minnesota Cities legislative exchange February 20-21, and the National League of Cities meeting in Washington DC the second week in March. Councilmember Polehna noted that in meetings on the Manning Avenue/Highway 36 intersection, Washington County is considering asking the legislature for money to complete the project. He feels this might be a good project for Stillwater's lobbyist to work on. Mayor Kozlowski suggested reaching out for support from Oak Park Heights and Bayport, since traffic safety on Highway 36 impacts everyone in the area. Mr. McCarty stated in the 2019 budget there are some funds designated as a placeholder for the potential engagement of a lobbyist for legislative activities, but the City does not have a Page 3 of 8 City Council Meeting January 22, 2019 standing lobbyist contract. He will contact Brian McDaniel, who may be interested in being the City's lobbyist in 2019. Mr. McCarty will report back at the February 5 meeting. Mayor Kozlowski recessed the meeting at 5:36 p.m. RECESSED MEETING 7:00 P.M. Mayor Kozlowski called the meeting to order at 7:01 p.m. Present: Mayor Kozlowski, Councilmembers Collins, Junker and Polehna Absent: Councilmember Weidner Staff present: City Administrator McCarty City Attorney Land Community Development Director Turnblad City Clerk Wolf PLEDGE OF ALLEGIANCE Mayor Kozlowski led the Council and audience in the Pledge of Allegiance. APPROVAL OF MINUTES Possible approval of the January 8, 2019 regular meeting minutes Motion by Councilmember Collins, seconded by Councilmember Polehna, to approve the minutes of the January 8, 2019 regular meeting.All in favor. PETITIONS, INDIVIDUALS, DELEGATIONS &COMMENDATIONS There were no petitions, individuals, delegations or commendations. OPEN FORUM There were no public comments. CONSENT AGENDA Resolution 2019-014, Directing payment of bills Possible approval of sanitary sewer adjustment Possible approval of Brian's Bocce Ball Tournament Event- February 23, 2019 Possible approval of purchase of 2019 Ford 550 truck with plow for Public Works Resolution 2019-015, resolution amending Resolution 2018-273 adopting 2019 Fee Schedule Resolution 2019-016, approving the 2019-2020 Labor Agreement between the City of Stillwater and Minnesota Public Employees'Association Motion by Councilmember Polehna, seconded by Councilmember Junker, to adopt the Consent Agenda. Ayes: Councilmembers Collins, Junker, Polehna, and Mayor Kozlowski Nays: None Page 4 of 8 City Council Meeting January 22, 2019 PUBLIC HEARINGS Case No. 2018-33. An appeal request by Midnight Real Estate, LLC, property owner, for the reconsideration of the HPC's denial of balconies on the Crosby Hotel's Main Street facade. The property is located at 232 Main Street North in the CBD district. Community Development Director Turnblad reviewed the case. In 2016 the Planning Commission granted approval of a 9' variance to the 15' Central Business District's Front Yard Setback for a hotel lobby and entrance to be located 6' from the property line adjacent to Main Street North. In late 2016, the HPC conditionally approved a design permit for the Crosby hotel. In 2017, the applicant requested the HPC's consideration of an amendment that included the installation of four Main Street facing balconies. The HPC partially denied the request,citing full depth balconies extending in front of the wall face were not consistent with the character of the downtown core. The HPC stated: "Main Street balconies shall not have a projecting walking surface and be designed with a balcony railing to match proposed railings elsewhere on the structure." The applicant installed second and third floor railings in conformance with the HPC's approval condition, but in November 2018, resubmitted a request for consideration of the full depth balconies. Once again, the HPC denied the applicant's request. The applicant is appealing the denial and requesting the Council's consideration of the installation of four balconies, ranging between four and five feet deep, proposed to be located on the east elevation's second and third stories. Staff finds the proportion of Main Street balconies,including their projection from the front of the building face and the total balcony depth,are not compatible with the character of the neighborhood and are not in harmony with the design of adjacent development. Therefore, staff recommends denial of the full-depth balcony request. On a question from Mayor Kozlowski about how far does the black awning on the north side of the building extends; Community Development Director Turnblad responded that the awning goes to property line. The balconies, as proposed, are set back further from the property line than the existing canopy on the north. He addressed comments that the building immediately to the north, Mills on Main, has protruding balconies. He provided a graphic showing the two kinds of balconies on Mills on Main, all of which are recessed. He indicated that there really are not any balconies on Main Street that project beyond the facade of the building. Mayor Kozlowski opened the public hearing. Don Ganje, 350 Main Street North,Unit 206,in Mills on Main, spoke in favor of the proposed balconies. He feels the hotel is a gorgeous building whose proportions match the rest of the downtown area. The Mills on Main balconies project about 2' and go back in another 4'. He feels the "fake" balconies look like a giant barricade that is plastered against the doors and are really a detriment to the look of the building. Chris Diebold,Midnight Real Estate II,LLC,pointed out that the balconies as proposed come out about 6" shy of the property line. The balconies were always meant to balance the front of the building. He understands the HPC's concern about setting a precedent, but without the balconies as proposed,the building looks unfinished.The reason the fake balconies were installed is that they needed them placed in order to get an occupancy certificate. Delia Flynn, a Mills on Main resident, stated the Crosby is beautiful. She would like to see the full balconies as proposed. The existing balconies remind her of a prison. Page 5 of 8 City Council Meeting January 22, 2019 Mayor Kozlowski closed the public hearing. Mayor Kozlowski agreed with the residents. He feels the existing balconies look like a Holiday Inn Express. He understands the HPC's objective, but ultimately it is a design recommendation. He supports approving the request. Councilmember Junker complimented the beautiful hotel building and the Midnight Group. He stated he supports the HPC's conclusion in December 2017 that protruding decks are out of character for Main Street, because every other deck on Main Street is either recessed or is not a full-fledged protruding deck. Mayor Kozlowski argued that the Mills on Main balconies do protrude. He totally supports the HPC, but feels that the Design Guidelines are guidelines. If everything were to look the same, it would be a tragic mistake for downtown Stillwater. The character of the hotel building is different from the other buildings. Councilmember Polehna remarked the existing balconies remind him of a house where people can not afford a deck. He does not like going against commissions,but feels the hotel at present looks unfinished. Commissioner Collins agreed that what is there is not good. He feels the HPC does great work, but the balconies need more depth. Motion by Councilmember Kozlowski, seconded by Councilmember Polehna, to approve Case No. 2018-33, an appeal by Midnight Real Estate, LLC of the HPC's denial of balconies on the Crosby Hotel's Main Street facade at 232 Main Street North. Ayes: Councilmembers Collins, Polehna and Mayor Kozlowski Nays: Councilmember Junker UNFINISHED BUSINESS There was no unfinished business. NEW BUSINESS Possible approval of permit to keep bees at 1212 First Street South Community Development Director Turnblad stated that Jeffrey Abbott has requested a permit to keep bees and to sell the honey from his home. He has requested one apiary and two hives to be situated next to his single car garage. The application meets the requirements of City Code Sec. 27-3, Keeping of Bees. An objection was received from one neighbor at 1215 Second Street South (directly behind Mr. Abbott's house), who has allergies. Staff recommends approval of a one year provisional permit with five conditions. Mr.Abbott,applicant,told the Council there will be about 10,000 bees per hive to begin with. His property is three-quarters fenced. Motion by Councilmember Collins, seconded by Councilmember Polehna, to approve a permit to keep bees at 1212 First Street South,with the five conditions recommended by staff. Ayes: Councilmembers Collins, Junker, Polehna, and Mayor Kozlowski Nays: None Page 6 of 8 City Council Meeting January 22, 2019 Possible approval of parking lease agreement with Only a Dim Image Productions Community Development Director Turnblad explained it has been two years since the theater company received a Special Use Permit (SUP) with one of the conditions being to provide sufficient parking. The lot to the north is partially improved, but with more width, the number of cars could be doubled. So before the occupancy permit is issued for the theater, which may be a couple years from now, the parking lot to the north needs to be improved. The City owns the property, so what is requested is the lease that was written specifically for the depot be updated so it is written for the theater. There is a blank for the amount of the lease because improvements by the private parties will be needed,and it will have to be brought back later with a number. Councilmember Junker commented that with the opening of the trail,the City could use that space over the next two years until it is needed by the theater. After the theater opens, he has no problem assigning the lease to the theater. Councilmember Polehna stated he has no problems if the theater wants to use the lot now, but he does not see the City entering a long term lease at present, in order to keep options open for public parking uses. City Attorney Land pointed out that the existing lease is perpetual and exclusive.There will be a significant need to revise it at some point. Although the theater would like to see it in their own name, it is not necessary to change it at this time because it runs with the land. Possible approval of agreement with Sporting St. Croix Soccer Club St. Croix Valley Recreation Center Manager Doug Brady explained the proposed agreement is similar to what was in place in 1998 when the facility was built. The Club has pledged financial improvement money and for that they would like a little bit of priority use of the facility. They still pay for their time. This would be their third time contributing funds for the facility. Motion by Councilmember Polehna, seconded by Councilmember Junker, to adopt Resolution 2019-017, resolution approving agreement between City of Stillwater and Sporting St. Croix Soccer Club for the use of the St. Croix Valley Recreation Center. Ayes: Councilmembers Collins, Junker, Polehna, and Mayor Kozlowski Nays: None COMMUNICATIONS/REQUESTS There were no communications/requests. COUNCIL REQUEST ITEMS There were no Council request items. Page 7 of 8 City Council Meeting January 22, 2019 ADJOURNMENT Motion by Councilmember Junker, seconded by Councilmember Polehna, to adjourn. All in favor. The meeting was adjourned at 7:51 p.m. Michael Polehna,Vice Mayor ATTEST: Beth Wolf, City Cler Resolution 2019-014, Directing payment of bills Resolution 2019-015, resolution amending resolution 2018-273 adopting 2019 Fee Schedule Resolution 2019-016, approving the 2019-2020 Labor Agreement between the City of Stillwater and Minnesota Public Employees'Association Resolution 2019-017, resolution approving agreement between City of Stillwater and Sporting St. Croix Soccer Club for the use of the St. Croix Valley Recreation Center Page 8 of 8