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HomeMy WebLinkAbout02-07-08February 7, 2008 Page 1 of 5 Pursuant to due call and notice thereof, the City Council for the City of St. Joseph met in regular session on Thursday, February 7, 2008 at 7:00 PM in the St. Joseph City Hall. Members Present: Mayor AI Rassier, Councilors Renee Symanietz, Dale Wck, Steve Frank City Administrator Judy Weyrens City Representatives Present: City Engineer Randy Sabart, Public Works Director Dick Taufen, Finance Director Lori Bartlett Others Present: Wahlstroms, Ken Jacobson, Randy Torborg, Phyllis Plantenberg Approve Agenda: Symanietz made a motion to approve the agenda with the following changes/additions: Add 8a Planning Commission Vacancy Change 4e Pay Application #2 (Final) The motion was seconded by Wick and passed unanimously. Public Comments to the Agenda: No one present wished to comment. Consent Agenda: Symanietr made a motion to approve the consent agenda as follows: a. Minutes -Approve the minutes of January 24, 2008. b. Bills Payable -Approve check numbers 000114-000122 8~ 039862-039935. c. Capital Request -Authorize the purchase of a desk top computer and title system for the Cable Commission for a cost of $1,380.72. d. Contract Employees -Accept the recommendation of the Personnel Committee finding the reviews of the contract employees satisfactory, thereby accepting the 2008 compensation. e. Application for Payment -Authorize the Mayor to execute Application for Payment #1 for the 2007 Storm Sewer Improvements and authorize payment to Larson Excavating Contractors, Inc in the amount of $8,736.70. f. Capital Equipment Purchase -Authorize the expenditure of $8,000 for the purchase of a 3120 Lawn Tractor and Mower from Mies Equipment. g. Gambling Permit -Accept the Lawful Gambling Application for Exempt Permit for the Muscular Dystrophy Association for an event to be held at the Stonehouse on June 7, 2008. h. Application for Payment -Authorize the Mayor to execute Application for Payment #18 for the Water Treatment Plant and authorize payment to John T. Jones in the amount of $54,680.75. The motion was seconded by Frank and passed unanimously. 2008 Bond Issue: Monte Eastvold approached the Councilors to present the 2008 Bond Issue. The first issue is for a pending equipment certificate totaling $290,000 with issuance expenses. This bond would be payable over five years with an annual tax levy of $61-63,000. He stated that the payments would be financed entirely with tax levies. Eastvold added that the sale would take place at the March 6, 2008 Council Meeting and the bond closing would be April 3, 2008. Frank questioned the increase in the tax levies. He understood that the tax hearings were already held and finalized. Weyrens stated that this levy would begin in 2009 replacing an existing equipment certificate that will be coming off. Eastvold then addressed the possibility of refunding the 2001 Sewer Revenue Bond and the 2002 Improvement Bond. Interest rates have been decreasing and by refunding those two bonds, the City could save $88,356 over time. The call date for those bonds is 12/2009. Therefore, the City would make the original bond payments until that time and then the new interest rates would take February 7, 2008 Page 2 of 5 effect. Eastvold stated that the State requires a 3% minimum savings test in order to refund bonds. At this time, the City is just above that requirement. He questioned the Council as to whether or not they are interested in pursuing the refunding of the 2001 and 2002 bonds as discussed. Wick questioned when the bonds will be due. According to Eastvold, the 2001 bond matures in 2021 and the 2002 bond matures in 2017. Eastvold discussed with the Council the recent media articles on the quality of municipal bonds that are insured. Municipalities insure bonds to increase the bond rating to an A rating which in turn yields a better interest rate. During the housing boom, some of the bond companies that provided insurance were under collateralized and as long as the housing market was good, it did not have a negative effect. However, now that the market is decreasing the bond companies that offered sub prime mortgages are suffering. These same bond companies do not have enough collateral for the municipal bonds they issued, and the bonds will carry the same value. As a result, there are only two bond companies left that have the capacity to insure bonds, leaving a demand market. Eastvold stated that when insuring bonds you must now look at the premium charged for the insurance and the net interest rate without insurance. In the bond before the Council, the savings in interest warrants the insurance premium that will be charged. Wick questioned whether the savings presented to the Council include issuance costs and premiums. Eastvold stated that those costs have been included and those are net savings. With respect to the possible refunding, Rassier questioned what happens next. Eastvold advised the Council that they can begin the paperwork and bring it back at a later meeting in March or when the interest rates may be more favorable. He did, however, state that if the bond refunding is done at the same time as the equipment certificate the City may be able to save on issuance expenses. Rassier clarified that if interest rates continue to decrease, they may be able to save more. Frank advised Weyrens that he would like recommendation from Staff as to whether or not the City should choose to take insurance on the bond issue. He questioned Eastvold as to what happens if the City were to default on a bond. Eastvold replied that the City does not want to default on a bond because the City will always need to issue bonds to maintain infrastructure and by defaulting on a bond, it may become difficult to get new bond issues and the interest rates will be higher. He added that he is not aware of any municipality that has defaulted on a bond since the 1930's. Eastvold also stated that the reason municipalities issues General Obligation Bonds is to be able to utilize the taxing authority. Weyrens stated that she requested Eastvold to present the information to the Council as the proposed savings are significant. One of the bond funds being refunding is the sewer capacity issue which is primarily funded through sewer access fees. Reducing the interest cost will maximize the access fees collected by the City. The City will be required to finance a portion of the St. Cloud Treatment Plant and that project will also be funded with sewer access fees. The second reason for refinancing at this time is to save issuance costs on the 2008 Equipment Certificates. Eastvold advised the Council that in December 2006, interest rates hit a 40 year low and it appears that they are getting close to that low point again. It appears that the long term bond rates are increasing and the short term rates are decreasing. With respect to the City's credit rating, Rassier questioned whether or not refunding bonds would affect the City's rating. The City's current rating is BAA1. When the City's debt is reduced, bond companies look at it as a positive for the City. Therefore refinancing bond issues has a positive affect on the bond rating. The Council approved both bond issues by consensus. Holidav Decoration Donation Repuest: Ken Jacobson, 1315 Eagle Ridge Drive, approached the Councilors to discuss the City's Holiday decorations. He stated that the Fire Department has February 7, 2008 Page 3 of 5 been handing and maintaining the holiday decorations. This year the department noticed that the decorations are falling apart and the lights are not working as well. Therefore, the Fire Department is requesting the Council establish a five year improvement plan and fund up to $ 2,000 per year for replacement. Weyrens stated that funds could be reallocated to make this work. Wick questioned whether a separate fund would be created to which Weyrens stated it would. Wick also clarified that people would be able to make donations as well. Frank questioned whether or not the City would receive any incentives from Xcel Energy if they were to use LED lights. Jacobson stated that most of the new lights are LED. Weyrens advised the Council that she would work have those discussions with Xcel. Frank made a motion to approve the expenditure of $2,OOOlyear for the next five years to help with the replacement of the holiday decorations. The motion was seconded by Symanietr and passed unanimously. CITY ENGINEER REPORTS - No Report MAYOR REPORTS Planning Commission Vacancy: Rassier notified the Council that Bob Loso resigned from the Planning Commission, creating a vacancy. Staff placed an ad in the St. Joseph Newsleader and three applications were received. The Planning Commission Chair and Council Liaison met with Rassier and they have selected Mike McDonald to fill the vacancy until the end of Loso's term. Wick made a motion to approve the appointment of Mike McDonald to the Planning Commission. The motion was seconded by Symanietr and passed unanimously. Councilor Training: Rassier stated that he received an email from Councilor Schultz questioning New Councilor Training.. According to Weyrens, Schultz is all set up to attend the training. SYMANIETZ COUNCILOR REPORTS St. Cloud Area Joint Planning District Board: Symanietz reported that she attended the SCAJPD Board at which they formed a committee for affordable housing. That Committee will hold informational meetings throughout the year in April, July and October. Those meetings would be open to the public. Weyrens added that the 5 area cities met and the first meeting will be about foreclosures and will be in the format of a panel discussion. APO: Symanietz stated that she attended the APO meeting at which they discussed the Northern Rail System. They hope to have it up and running by November 2009. The new Rail System will run from Big Lake to Minneapolis and will have a one way fare of $6.00. It is set up more for the commuters rather than travelers. Frank added that the emphasis is more of a commuter rail and will run from approximately Gam to 6:30pm. He also stated that they will have monthly passes available and they have discussed the possibility of shuttle buses running from 3 different locations. The St. Joseph Park and Ride is a possible location for a bus stop. Park Board: Symanietz reported that the Park Board met and they are in the process of prioritizing the projects for 2008. Joint Cities Meeting: Symanietz, along with fellow Councilors, attended the Joint Cities meeting in Rockville at which they discussed a resolution for lobbying at the Capital. Winter Warm-Up: Symanietz stated that she attended the annual Winter Warm-Up sponsored by the St. Joseph Chamber. February 7, 2008 Page 4 of 5 Mayor's Reception: Symanietz reported that she attended the Mayor's Reception for the St. Paul Winter Carnival. WICK Planning Commission Update: Wck reported that the Planning Commission met and discussed amendments to Ordinances 52.27, 52.28 and 55. The Council will receive amendments to 52.27 and 52.28 at their next meeting. The Planning Commission will be discussing Ordinance 55 again at their next meeting with a public hearing to be held in April. Rassier questioned if it would be possible to get the Ordinance changes earlier for review purposes. FRANK APO Meeting: Frank advised the Council that he attended the APO Meeting at which they discussed funding for transportation projects. He stated that the funding for Field Street has been pushed back from 2030 to 2035. Overall, he stated that it was a good meeting. ADMINISTRATOR REPORTS Comprehensive Plan: Weyrens stated that the City will be updating the Comprehensive Plan and the Planning Commission will be the lead agency for the update. They will meet on the 4'" Wednesday of each month at 6:00 PM with the only agenda item the Plan Update. Additionally, the first Public input meeting is scheduled for February 27. Frank questioned whether they will be working on amending the current plan or starting from scratch. Weyrens replied that they will be looking at the current plan to see what worked and what did not. She added that some areas of the Comprehensive Plan will need to be re-done. Frank also questioned whether power sources such as wind and solar will be discussed. Weyrens replied that they will be discussed. Frank then questioned whether or not the Council will receive an annual report. Weyrens stated that they will receive an annual report from the Planning Commission. Weyrens advised the Council that the information relating to the Comprehensive Plan Amendment will be available online. With respect to involvement of other entities, Frank questioned if surrounding areas will be involved in the process. Weyrens stated that Stearns County and St. Joseph Township will be very involved in the process and St. Wendel will have little involvement. Street lighting - 2"d Avenue NW: Weyrens stated that recently there has been some discussion about adding two additional street lamps on 2"d Avenue NW, one at MN Street and 2"d and one at the alley intersection. In order to accomplish this, the City would need to request that Xcel add the additional lamps to the existing poles. Symanietz made a motion to authorize the additional street lamps. The motion was seconded by Wick. Discussion: Frank addressed the Council with respect to the need for a sidewalk along 2"d Avenue NW. He stated that this was an issue that was discussed in the past; however, it appears that the issue was never followed up on. He stated that he, along with others in the community, feels that this is a need. Frank was advised that the City Engineer is working on the figures of adding the sidewalk. The motion passed unanimously. Public Works Director Hiring Update: Weyrens stated that the background check has been successfully completed and the City has offered Terry Thene the job of Public Works Director. He is able to start on March 4. February 7, 2008 Page 5 of 5 Frank made a motion to approve the hiring of Terry Thene for the Public Works Director. The motion was seconded by Wick and passed unanimously. Stearns County Assessor Update: Weyrens advised the Council that the Stearns County Assessor will be present at the next Council meeting to answer any questions that the Council may have. They will be ready to answer questions relating to St. Ben's as well as residential and commercial properties. Sign Ordinance: Weyrens stated that the Council will be reviewing the amendment to the Sign Ordinance at their next meeting as well. Adjourn: Wick made a motion to adjourn; seconded by Symanietz and passed unanimously. i ~x~~ ~ J dy eyre~hs dmi istrator