HomeMy WebLinkAbout2009 [04] Apr 16April 16, 2009
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Pursuant to due call and notice thereof, the City Council for the City of St. Joseph met in regular session
on Thursday, April 16, 2009 at 7:00 PM in the St. Joseph City Hall, opening the meeting with the Pledge
of Allegiance.
Members Present: Mayor AI Rassier, Councilors Renee Symanietz, Dale Wick, Bob Loso, Steve Frank,
City Administrator Judy Weyrens
City Representatives Present: City Engineer Randy Sabart, City Attorney Tom Jovanovich, Finance
Director Lori Bartlett, Public Works Director Terry Thene
Others Present: Tom Matthews
Public Comments: There was no one present wishing to speak. Frank stated that he received an email
from Mike McDonald stating that he would not be there, but wanted some items added to the record on
his behalf.
• Open Meeting Law Coverage- McDonald questioned this item on the bills payable as it appeared
from the listing the annual coverage cost exceeded $ 78,000. Weyrens stated that the insurance
premium for the open meeting law is part of the overall premium which is approximately $ 78,000.
Of that amount less than $1,000 is for open meeting law coverage.
• Acceptance of Gifts -McDonald questioned the donation from the College of St. Benedict for fire
service. Weyrens stated that this is truly a donation as they are not required to pay for fire
service.
• St. Ben's Sewer Payment -Weyrens stated that this issue will be addressed later in the meeting.
Agenda: Wick made a motion to approve the agenda; seconded by Symanietz and passed
unanimously.
Consent Agenda: Loso made a motion to approve the consent agenda as follows:
a. Minutes -Approve the Council minutes of April 2, 2009.
b. Bills Payable -Approve check numbers 041487-041541 and EFT numbers 000262-000267.
c. Treasurer's Report -Accept the March 2009 Treasurer's Report.
d. Quarterly Finance Position -Accept the 15` Quarter 2009 Financial Reports.
e. Acceptance of Gifts -Accept the donations and their purposes as presented.
f. Policy Book Amendment -Amend the Policy Book to include the Identit~ Theft policy.
g. Interim Use Permit -Issue an Interim Use Permit to Travis Fruth, 220 17` Avenue SE, to
operate and owner occupied rental unit with a maximum density of two tenants.
The motion was seconded by Wick and passed unanimously.
St. Ben's Sewer Use: City Attorney Tom Jovanovich was present to discuss the St. Ben's Sewer Use
Agreement as well as past billings that are still outstanding. (Note: the reference to St. Ben's includes
both the Monastery and College). Jovanovich stated that St. Ben's has indicated that it is their opinion
that they are being overcharged for sewer services and therefore have not paid the 2007 and 2008 sewer
service statements. The City has been working on resolution of this matter for approximately two years
there has not been any movement towards resolution. Jovanovich stated the original sewer use
agreement was created in April 1987 and is now 22 years old. The agreement should be re-negotiated to
determine what is fair and equitable for all parties.
He advised the Council that he met with Tom Matthews, the attorney representing St. Ben's, to hear their
concerns. The three main concerns are:
1. St. Ben's wants to be charged in a fair and equitable manner for the use of the sewer. The
agreement should be re-looked at to meet current day realities as the City has changed
substantially.
2. They have been charged for depreciation starting in 2002.
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3. They would like verification of their bill as they are being charged based on sewer usage pursuant
to 6 different accounts.
Jovanovich stated that, based on conversations with Mr. Matthews, they are looking for a fair and
equitable charge. Based on the existing Sewer Use Agreement and past practice, the City has been
billing St. Ben's 45% of eligible expenditures. When the Agreement was established in 1987 St. Benedict
was to be billed based on readings from a flow meter measuring the flow for the served area. The City
tried to install and read flow meters, but the flow meters at that time were not effective. The meters
worked for a short period of time and to continue the use of the meters would have been costly and
ineffective. From the short period of time the meters worked, it was established that the flow supported
the agreement and 45% of the flow originated from St. Ben's. Therefore, the City annual invoiced St.
Benedict for 45% of the eligible expenses and this practice continued until recently when St. Ben's raised
concerns.
St. Ben's is citing that the City population has increased by 65-70%; however, the population at the
college has had minimal increases and the monastery population has decreased. St. Ben's is now
questioning if the 45% figure is a fair and equitable. It is also the opinion of St. Ben's that the 1987
agreement deals with Capital costs and user costs and the user costs were to be distributed by a certain
percentage to each account. The billing doesn't comply with those accounts. On the surface that is true;
however, the City provides much more detail than that.
Depreciation is another issue as it is St. Ben's position that there is nothing in the Ordinance or in the
agreement allowing for depreciation. According to Jovanovich, after reading the Ordinance, it talks about
a sinking fund and depreciation. They questioned whether it is in the form of a sinking fund, meaning that
it is put aside in the event that the plant needs to be upgraded in the future? They also questioned where
the money is going. Matthews agreed with Jovanovich and stated that those are an accurate account of
their conversations.
The City needs to determine how they want to handle the past billings and the future agreement.
Jovanovich stated that, others may disagree, but it is his opinion that they resolve the matter going into
the future and then work out the past billings. Weyrens stated that they plan to present a proposal to St.
Ben's and start negotiations for a new agreement. She suggested that St. Ben's be charged as a
commercial user and that charges be based on use and metering.
Weyrens presented the Council with an alternative billing method for St. Ben's. There were several facts
that went into her calculations. Commercial users are billed based on their actual usage. They do not
receive the same benefit that residential customers receive by having a maximum sewer charge based on
the winter quarter reading. In order to determine usage, the City contacted the DNR to receive copies of
the last five years water report. These reports would provide actual water usage so a proposed bill could
be calculated. The sewer rate was $1.50/100 cu feet in 2005 and $1.60 in 2006-2008. The sewer line
charge is $3.00/unit. The proposal presented to the Council illustrated a sewer usage charge based on
the water report and the line charge based on one unit per dwelling unit (dorm/sleeping quarter). This
method is consistent with that of the apartments in the City. They are billed for each apartment,
regardless of number of bedrooms. Since the City did have access to the actual number of dwelling
units, the illustration is an estimated number of units. Based on her calculations, if they were billed as a
commercial account, they would have paid an additional $17,794.82 in 2005 and an additional
$22,497.03 in 2008.Weyrens added that the difference in 2008 would have been much higher; however,
the amount billed to St. Ben's in 2008 was overstated as it included the capital costs for the rehab of the
treatment plant.
Frank clarified that if they were charged at a commercial rate, there bills would be much higher. He added
that there are other uses of water at the College rather than just the dorms. Weyrens agreed and stated
that the current agreement is 22 years old. The City's growth pattern has changed over the years and St.
Ben's has tried to change the utilization of the campus to make it usable 12 months a year.
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With regard to the charging for deprecation, Weyrens stated that when the City was required to
implement the accounting standard known as GASB34, all the assets of the City were reviewed and the
City started looking at rate structures to cover the cost of depreciation. She referred to a letter from
Mathews dated January 7 which talks about how they are to be billed and how the City has been billing
them. According to Weyrens, in an ideal world, all of the depreciation costs would be fully covered.
When the City restructured the rates in 2005 the Council agreed to establish the rates to cover 50% of
depreciation costs. In reviewing the actual collection of fees, the new method of billing has met the goals
they were intended to serve. Loso questioned if the line charge is part of the GASB process. Weyrens
explained that it is not, but the accounting for assets and depreciation is. Previously, there was a
minimum charged billed for water and sewer; however, it was changed to a separate line charge along
with the actual charges for usage so that everyone shares equal responsibility.
Jovanovich asked far a breakdown of capital improvements and questioned how that will be assessed.
Sabart provided the Council with a summary of the improvement costs for St. Joseph and the area cities.
This will include the upgrade and expansion of the system. The St. Cloud Wastewater System will have
significant costs over the next few years to include maintenance, repair and expansion. When the City
reviews the costs, he identifies which costs St. Ben's benefits from and then those fees would be passed
on. From a homeowner's perspective, he stated that they pay for the lift station repairs no matter what;
whereas, St. Ben's only pays for their portion. Rassier stated that the line charges that are paid help to
pay for all of the lift stations. Frank added that if they were to be billed like a commercial business, it
would be more like how the residents are billed. Businesses pay for all lift stations whether it services
their business or not.
Sabart stated that to meter the usage for sewer, it would be based on the water consumption. Currently,
there is noway of measuring usage on campus. If the City were to meter the sewer usage, the manholes
would need upgrading; therefore it is the City's preference to measure water use. Loso questioned
whether it is still cost prohibitive or technologically prohibitive. Jovanovich stated that when the issued
was raised a year and a half ago, it was determined that metering would not be cost effective. In order for
the meters to be installed the manholes would have to be updated and that is extremely costly. Even if
the meter were installed there is extensive monitoring and calibrating of the meters to make sure theya re
correct. Sabart suggested using water usage as it would be best to have a consistent way of measuring.
Rassier stated that, in his opinion, the current system is fair; you pay for what you use.
Rassier asked the Council what they want to do. Loso stated that the attorney is asking for approval to
renegotiate the contract. Jovanovich added that they would like to get that done in a timely manner and
then discuss the past billings. The City has been asked about these unpaid bills during the audit. Loso
stated that he is interested in what St. Ben's feels about the past billings. Weyrens added that the City
generally charges 5.5% interest on past due accounts; however, no interest has been charged yet.
Matthews approached the Council to speak on behalf of St. Ben's. He stated that there is a fair amount of
discrepancy on the past billings. In his opinion, they must first resolve the past billings before moving
forward. They are asking that St. Ben's be treated the same as any commercial user; then the $1.5 million
for plant updates would not be assessed. Sabart stated that then all commercial accounts would need to
be re-evaluated. It was stated that the Ordinance would also need to be amended for contract users.
Matthews stated that he would rather not discuss the past billings at this time, as they are already working
with the City Attorney. Wick questioned Jovanovich to what he felt was a reasonable time frame which he
suggested August 1. Matthews stated that St. Ben's has accurate daily readings but they do not feel that
the sharing between the College and the City have been accounted for. There have been several times
when one system or the other has been shut down and they have shared large volumes of water. He
added that they have a fair amount of grounds that are irrigated when the water never reaches the sewer.
Rassier spoke from past experience and stated that the only place that is irrigated is the President's
Residence; all others are served by private wells. In his opinion, the City should get a commitment up to
date and then negotiate a new agreement. He is not in favor of negotiating payments that are two years
past due. Matthews stated that this process began in November 2007 and there have been several
requests since then. They have stated that until they receive this information, they are not going to pay
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those charges. They believe they are making a rightful request under the current agreement and they are
entitled to receive that information. Matthews stated that one suggestion is to continue to use the
formulas in the Ordinance. They want verification of the current agreement before moving forward.
Loso questioned the fact that they say they have requested information and never received it. Matthews
stated that, initially, they received information very quickly. The letter sent in January 2008 was the start
of the current activity. Symanietz questioned why this issue was not presented to the Council prior to now,
if it started two years ago. Weyrens replied that staff has been working on this issue and it was never
portrayed that they were not going to pay.
It was clarified by Matthews that depreciation is the biggest issue as they do not believe it is an item that
should be billed. In the past, there were some errors with the billings and they were credited. Matthews
stated that they have looked at the City's population growth as well as the leveling population at the
College and Monastery and the current breakdown no longer seems right. Wick questioned why they are
refusing to pay without asking to renegotiate the contract. He added that what was done in the past is
done and they must move forward.
Weyrens advised the Council that there are two methodologies that can be used for their billing. They can
be billed as either a contract user or a commercial user. The purpose of discussing this was to bring the
Council up to date with the different alternatives. Frank stated that this is a very complex issue and he
would prefer to see something done prior to August 1. Jovanovich stated that when the issue arose, they
discussed the possibility of metering sewage and then water. He suggested keeping the agreement and
finding a way to measure it. In order for any agreement to work, both parties must feel that it is fair and
equitable. Staff believes that St. Ben's should measure all of their water usage. Frank stated that he does
not want to see the City pay attorney fees to mediate this issue. If they want to pay and we want to work
with them, he would like to get it done.
Wick questioned how much it would cost to meter their usage. Sabart estimated the cost at $50,000;
however there has been nothing showing the itemized costs. Loso stated that he has no problem looking
at a new agreement for the future, but he feels past due balances should be paid. Rassier added that the
City has controlled meters for metering residential usage, so we should be able to meter the uses at the
College. Rassier, along with Wick and Jovanovich, suggested that the City look at the cost to meter their
buildings. Rassier questioned who sits on the Committee to negotiate the agreement and past due
payments. Jovanovich stated it is comprised of himself, Sabart, Thene and Weyrens as well as a
representative from St. Ben's. He stated that, in June, they would like to bring a draft agreement back as
well as a plan for payment. If there is no plan for payment by June 1, this issue would be sent to
arbitration or a court proceeding.
Loso made a motion to authorize the City Attorney and staff to continue working with St. Ben's to
resolve the outstanding issues related to the sewer invoices for 2007 and 2008 and to provide the
Council with a new sewer use agreement. The matter should be brought back to the Council no
later than June 1, 2009. The motion was seconded by Wick and passed unanimously.
CITY ENGINEER REPORTS
APO TAC Update: Sabart presented the Council with a summary from the most recent APO TAC
meeting. He stated that they discussed the split of federal funds between expansion and preservation.
This had a negative impact to the City of St. Joseph with respect to the North Corridor project. That
project was taken off the eligibility list. They have asked for that list to be re-evaluated for a more
reasonable split for equitability. He stated that there were some adjustments. They removed the
CR75/Roosevelt Road project and then it was added back in. The North Corridor project was added back
in as a constrained project. Frank stated that this was interesting for him. It is hard to preserve, but also a
priority to work on expansion projects. Sabart stated that it was a split vote to dedicate more money
towards preservation projects.
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Water Treatment Plant Update: Sabart advised the Council that they have been working with Timberweld,
the supplier of the glue laminated beams at the Water Treatment Plant. They visited the site last Tuesday
to assess their access to the beams. They are making plans to reinforce those column connections, He
will report more later in the process.
APO: At the Council Workshop, Scott Mareck was present to talk about the High Priority Project (HPP)
List. Both the North Corridor and Field Street were on the list. Sabart stated that he received some
correspondence from Congresswoman Bachman looking for written correspondence on City letterhead
stating that there is continued support for each project. The letter must be submitted prior to April 24. The
letter must state that there is financial support to build the project(s). He reminded the Council that they
will not receive funding for 100% of the project. The City must also indicate how they will provide for
public comments. Technically with the current studies, there will be a time for public review. Frank
clarified that the City will not be asked to commit to any particular route. Sabart replied that they would not
as the studies are ongoing at this time. If there is no letter received, both projects will be removed from
the HPP List. He suggested writing letters for joint projects as well. Projects on the HPP List haven't
always earmarked at 80%, but the City needs to say that they can make a decision if it is one of the top
five projects. Sabart cautioned the Council that they cannot back out later.
Wick made a motion to authorize approval for the City to send a letter in support of the St. Joseph
Projects on the APO HPP List. The motion was seconded by Symanietz and passed unanimously.
MAYOR REPORTS
APO Executive Meeting: Rassier reported that they will continue to work on the HPP List at the next APO
Executive Meeting.
FRANK
COUNCIL REPORTS
Minutes Clarification: Frank stated that based on the minutes of past Council meeting, he is not opposed
to inspection fees when someone comes out to do electrical inspections. He; however, has a problem
when people are charged $25-$50 and the inspection isn't completed until 7 months later. The installers
are trained to do that type of work and it is a waste of time to have an inspector. He would like to see
moving towards a system where the installer checks off and certifies the work.
With respect to the discussion on the Metro Bus, he clarified that he was referring to the Metro
Bus/Northstar Connection, not general bus service in St. Joseph. They will begin providing a service from
St. Cloud fairly soon; however, due to lack of funding, there will be no bus to the park and ride in St.
Joseph for the next couple of years.
Refuse Prooram: Frank stated that he noticed that the non-incorporated areas outside of the City use the
same hauler for refuse. He questioned whether their recycling would be included with the City's program
and if the City residents will receive points for theirs. Weyrens stated that they would not, as they do not
have the chips.
LOSO - No Report
WICK - No Report
SYMAN I ETZ
Women in City Government: Symanietz reported that she will be resigning from the Women in
Government Board of Directors in an effort to save the City some money.
Trails: Symanietz stated she has been noticing people walking around town. It is great to see people
utilizing the City's parks and trails.
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Safe Routes to School: Frank questioned why Kennedy School doesn't receive funds from the APO Safe
Routes to School Grant Program. Sabart stated that it is reviewed at the APO level and the applications
are on an individual basis. The applications are reviewed by MN Dot as well. Weyrens advised Frank that
the City has received some funding for sidewalks in the past. They have discussed this again, but no
formal application has been submitted yet.
ADMINISTRATOR REPORTS
BFA Grant Program Modification: Wick stated that the Business Facade Architecture (BFA) Grant
Program has been around for about two years. Recently, the EDA has made a few modifications to
include construction costs with the grant for architectural design work. The maximum allowed will remain
at $1,000 per property. The purpose of the modification is to help spur up some activity. The property
owner will need to apply for the grant and it must be approved. So far, the EDA has received requests
from Daisy a Day Floral, Gohman Construction, Bo Diddleys, Concrete Plus and Scenic Specialties.
Frank made a motion to approve the changes to the BFA Grant Program as presented. The motion
was seconded by Wick.
Discussion: Frank questioned the definition of a commercial business and what would happen if a
non-profit were to apply for a grant. Weyrens stated that a commercial business is not determined
by its tax structure.
The motion passed unanimously.
Development Fees -WAC/SAC: At the last meeting, the Council discussed the Fee Schedule and based
on discuss with a representative of the Central MN Builders Associations (CMBA), the Council tabled
action on the Water/Sewer Access fees for additional information. Specifically the Council questioned the
impact of not increasing the development fees as they are used for financing public projects such as the
water filtration plant. The CMBA has requested that the City not increase fees for 2009 as housing is
difficult under the current cost structure. The proposed fee schedule for 2009 increased the Water
Access Charge (WAC) $ 100 and the Sewer Access Charge (SAC) $ 200. The WAC was scheduled to
increase $ 100 in 2009 and that was part of a five year plan with 2009 being the last year. The increase
in SAC is in reaction to the costs for the St. Cloud Wastewater Systems expansion, repair and
maintenance.
Weyrens stated that the City projected 40 new units for 2009; however, it is clear that the slowing
economy will indicate that the City will not meet estimate. The City does have a fund balance in the WAC
and SAC funds so a one or two year slow down can be covered. Currently, the City charges a $200
inspection fee ($100 water/$100 sewer). She is proposing that the City remove that fee for 2009 and
increase the sewer access (SAC) fee by $200 as the WAC/SAC's need to increase.
Weyrens added that some new developers may ask the City to be creative with the payment of WAC/SAC
and the City can do that, but they would need to develop a plan. If water is turned on to a property, they
are charged for water usage. She added that although the City's WAC/SAC is higher, we do not charge
the high trunk fees as other cities do. Overall, the City's fees are right in line. Wick stated that most
businesses will come to the Council to discuss development fees. Rassier stated that the City can look at
those types of inquiries on a case by case basis. Weyrens added that if a developer will be required to
pay more than two WAC/SAC, the City may look at extending payment of those fees.
Wick made a motion to remove the inspection fees for 2009 and increase the WACISAC fees as
proposed. The motion was seconded by Loso and passed unanimously.
Agreement Release: Weyrens stated that there are times when documents are recorded and attached to
a property. As a result, the property owner may have problems when closing on the property or
refinancing. The Meadowlark Apartments were built with public financing in the mid 1980's and they are
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now requesting that the old agreements be released in order to obtain a clear title. The recorded
documents have been reviewed by the City Attorney who is recommending release.
Rassier made a motion to authorize the Mayor and Administrator to execute the Termination
Agreement as it relates to the Meadowlark Apartments. The motion is seconded by Wick and
passed unanimously.
Mayor Appointments: Rassier stated that he is proposing to leave the open position on the Park Board
vacant due to budget issues. In the future, it may be more prudent to add another member(s). Symanietz
agreed that there is no need to fill the position at this time. She added that they are also going to lessen
the number of meetings as they do not have much going on at this time.
Symanietz made a motion to keep the Park Board's open position vacant. The motion was
seconded by Frank.
Discussion: Frank stated that the Park Board did a Tremendous amount of work last year. Rassier
and Wick agreed that it would be best to have live members rather than six in the event that there
is a tie vote. Weyrens will send a letter to the applicants letting them know that the position will
not be filled. Wick questioned Jovanovich as to whether the Ordinance needs to be changed
stating that there will only be five members if there is a membership clause. Loso stated that the
Park Board would make that decision.
The motion passed unanimously.
Closed Meeting: Wick moved to close the meeting to discuss issues relating to the case of S & H
Partnership and Pond View Ridge v. City of St. Joseph. Issues to be discussed will be current status of
the litigation and strategy for mediation which is being scheduled. The grounds for closing the
meeting is to discuss pending litigation and is authorized by Minn. Stat. §13D.05, Subd. 3(b). The
motion was seconded by Symanietz and passed unanimously.
Adiourn: The meeting was opened at 10:00 and adjourned with Symanietz making a motion and Frank
seconding the motion. The motion passed unanimously.
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