Loading...
HomeMy WebLinkAbout2011 [08] Aug 18 Pursuant to due call and notice thereof, the St. Joseph City Council met in regular session on Thursday, August 18, 2011 at 7:00PM in the St. Joseph City Hall, opening the meeting with the Pledge of Allegiance. Members Present: Mayor Rick Schultz, Councilors Renee Symanietz, Dale Wick, Steve Frank, Bob Loso and City Administrator Judy Weyrens City Representatives Present: City Engineer Randy Sabart, City Attorney Tom Jovanovich, Finance Director Lori Bartlett, Police Chief Pete Jansky and Public Works Director Terry Thene Others Present: Ron Eiynck Mariterese Woida, Tom Klein, Dave Keller Schultz discussed the purpose of public comments. He stated that the public comment portion of the agenda is a time in which people may approach the Council to address whatever they wish. He stated that, at that time, the Council may question them; however, no action or decisions can be made. PUBLIC COMMENTS Ron Eiynck, 13 4th Avenue NW, approached the Council to discuss the proposed Park Terrace Improvements. In his opinion, this issue was railroaded and forced upon the Council. Based on the pictures that were provided and how the project was presented, he stated that it seems as though this is a terrible situation. Eiynck stated that he has sat in the areas where flooding is said to be a problem and he didn't witness any flooding. He added that it seems as though the Park Terrace Improvements are being proposed to accommodate future development. He concluded by stating that he would like something in writing to state that if his property value goes down that he would get his money back for the assessment. Approval of the Agenda: Symanietz made a motion to approve the agenda with the following change: 4(a) Minutes Due to Wick's absence at the last meeting, he requested that the minutes be considered separate from the consent agenda The motion was seconded by Wick and passed unanimously. Minutes: Loso made a motion to approve the minutes of August 4, 2011. The motion was seconded by Symanietz. Ayes: Schultz, Loso, Symanietz, Frank Nays: None. Abstain: Wick The motion passed 4:0:1 Consent Agenda: Wick made a motion to approve the consent agenda as follows: a. Minutes — Approved separately b. Bills Payable — Approve check numbers 044357 - 044396 and EFT numbers 000569 - 000573 (Payroll). c. July Treasurer's Report: Accept the July Treasurer's Report as presented. d. Gambling Report: Accept the 2' Quarter Gambling Report. The motion was seconded by Symanietz and passed unanimously. Citizen to Warrior: This item was removed as no one was present. Debt Management Policy: Bartlett presented a draft Debt Management Policy. She stated that the purpose of the policy is to potentially increase the Citys Bond Rating. According to Bartlett, the City follows these practices every day, but the rating agencies request that the Citys policy be in writing. Last year, the City received an A+ rating; however, had there been a written Debt Management Policy in effect, it may have been upgraded to AA. Bartlett stated that staff would like to have this policy in place prior to issuing bonds this fall. Loso made a motion to adopt the Debt Management Policy as presented. The motion was seconded by Frank. Discussion: Bartlett advised the Council that Monte Eastvold, Northland Securities, has reviewed the draft policy and was also involved in the process. She added that everyone follows these same practices. Frank stated that this is mainly a statement of principles. He questioned what would change if the policy was adopted. Bartlett responded that nothing will change as the policy reflects what the City has done in the past. Frank questioned the following: Section 111 (5) Determination of type and security of debt should be made based upon a review of the following factors: a. Direct and indirect beneficiaries of the project. b. Useful life of the project to be funded. c. Ability of a project to fund itself through user fees. Frank stated that he does not remember focusing on these items in the past. Bartlett replied that a lot of projects are included in the CIP and many are included in rate studies. She added that, generally, there are not going to be new projects to consider. Section IV (1) General obligation bond proceeds will not be utilized to fund the general operation or cash flow needs of the City, even though this is allowed by Minnesota Statutes. Frank expressed his opinion about bonding for items such as computers, tools, etc. He feels that those types of purchases should not be made with bond funds. Bartlett explained that this relates to more short term borrowing. Section IV (2) Rating Agency: The City will employ a rating agency on all debt issues where the rating process will enhance the offering to the public. The City shall employ one of the following rating agencies: a. Fitch Investors Service b. Moody's Investors Service c. Standards & Poor's Rating Services The question arose as to whether or not there were other alternatives. With recent issues, Schultz questioned whether or not other cities are dropping Standard & Poor's. Bartlett replied that these three firms are those that typically work in Minnesota for government entities. Section V (1) The City's collective debt shall amortize at least 50% of its principal within 10 years. Wick asked for clarification on this item. Bartlett explained that when Eastvold presents the Debt Management Study to the Council, he will explain where the debts are and what levies are needed over the next few years. During that process, we also look at how soon various debts will be paid off. It is desired that all of the active bonds be paid off over an average of ten years. She stated that this is one benchmark that the rating agencies look for. Frank questioned whether or not the City is within that threshold to which Bartlett replied, yes. Section VI (5) Equipment Certificates: These bonds are direct obligations of the City and pledge the full faith and credit of the City. Equipment Certificates shall be used to purchase equipment that is part of the Capital Improvement Plan. a. The City shall try and manage equipment certificates so that new certificates are only issued when a certificate expires. However, there may be times when this is not feasible. b. The revenue stream for re- payment of the debt is primarily general property tax, but in some circumstances may include contract revenue. Bartlett explained that, in past practice, the City typically issues two at one time to fund general capital equipment that cannot be funded each year through tax levies. She added that recent legislation changed the term from 10 to 15 years. Bartlett stated that the City generally issues equipment certificates for a 5 year term; however, staff is suggesting a 10 year certificate for the pumper truck as a way to keep the budget level. Section IV (3e) Monitor trends of key financial, economic, and debt ratios such as: e. Direct general obligation debt and contracts per capita. Direct debt per capita shall not exceed $2, 500. Wick questioned the Citys current debt. Bartlett replied that the direct GO debt is that debt that is funded solely by tax levies and does not include special assessment debt. Based on the Citys current debt, the per capita amount is approximately $1,600. Wick questioned Bartlett as to why we chose an amount of $2,500 to which Bartlett responded that, according to Eastvold that is the standard amount. The motion passed unanimously. Park Terrace Improvement: Weyrens presented the Council with additional information regarding the financial implications of the proposed 2012 Park Terrace Improvements. Since the City Council has already conducted the public hearing the next step in the process is to consider ordering the improvement. If the Council intends to move forward a resolution ordering the improvement would be required and this motion requires a 4/5 vote. If the project is ordered, the Engineer is authorized to design and prepare specifications for bidding the project. At this point the Council reviews the final plans and authorizes the competitive bidding. Once the bids are received a public hearing is conducted for the final assessment. At this point the Council could accept the bids and construction could commence. Loso stated that the engineer will need to begin the design process to determine what needs to be done at each individual property. Sabart stated that if the City is not participating in the cost of the individual service line, then individual review of each property is not needed. Symanietz questioned how long the design will last to which Sabart responded that one the project is designed the major components will not change and the design could be updated at some point in the future. Wick questioned the approximate cost of the design process which was estimated at $100,000. Symanietz questioned whether those fees can be assessed to which Weyrens explained that the City can only assess up to $4,500 per parcel based on the market analysis that was completed. Frank stated that this has been a learning process for him. Based on public input and direction from staff, the Council chose to do a pre- assessment analysis. Based on that analysis, the amount that can be assessed is lower resulting in the costs being divided amongst all residents. The question was previously raised as to whether not the residents will get their money back if the property values drop. He replied, probably not and added that the values may have gone down more had the project not been completed. Frank stated that the City has three options: 1. Do nothing 2. Fix the pipes that need to be fixed 3. Do it all According to him, it doesn't make sense to fix the road without doing the water and sewer improvements as well. He suggested that the City concentrate only on the project at hand and not the additional items that were presented. Frank clarified that the Council has chosen the financial alternative which assesses the property owners the $4,500 as determined by the pre assessment analysis and also requires them to absorb the cost of relocating the service line. Based on the proposed deviation from the 60/40 split for special assessments, Wick suggested that the City let other residents know as well. That change would result in higher property taxes for all property owners. The proposed improvement project costs would add 70% of the current debt levy to the current levy. According to Loso, by doing nothing, nothing is accomplished and this issue will come up again in a couple of years. By delaying the project, it simply increases the costs. It was stated that improvements Park Terrace has been part of the plan for the past 15 -20 years. This is the last development that is in need of an improvement to the infrastructure Schultz questioned whether or not the engineer is clear on the Council's direction to move forward. At this time Weyrens reminded the Council that the Public Improvement hearing was conducted in April and a decision must be made within six months or a new hearing would be required. Jovanovich advised the Council that if the project does not pass with a 4/5 vote, those voting against the project should provide reasons why they do not support the project. By providing reasons for the denial, Jovanovich stated that it limits the Citys liability in the event that there is an issue, such as a sewer collapse, etc. Loso questioned whether the Citys reasons for denial can be monetary to which Jovanovich explained that there would be discretionary immunity as it doesn't make sense to do the streets and not the utilities. Jovanovich advised the Council that the City is not responsible for sewer backup; that is the homeowners responsibility. Jovanovich stated that there is evidence that there are problems throughout the system; however, as long as the City has a maintenance plan in place for cleaning the sewers, the City has discretionary immunity. Loso believes that the City would be negligent. Jovanovich added that this comes down to a policy decision as to whether or not the Council wants to make this large of expenditure. He stated; however, that, at some point, this project will need to move forward. The City is not acting out of negligence as the City has presented options and the staff maintains the system on a regular basis. Schultz questioned the options to determine the scope of the project to move forward. He questioned the possibility of this being a rehabilitation project. Frank suggested relining those parts that could be relined and replacing only those that are bad. Sabart explained that they do not have costs for spot repairing. Weyrens advised the Council that they need to make a decision in October as they are only allowed 6 months from the time of the public improvement hearing. At a previous work session, the Council decided to use the Option 1 financing method if the project was to move forward. The Council came to a consensus that they would like to hold a public hearing to allow other taxpayers to comment on the proposed improvement project as this would create a large tax impact to all property owners. There were some previous comments about these improvements being needed to provide service to new development. Sabart advised the Council that new commercial development will not connect to Park Terrace. The connection would not be possible due to difference in elevation and the pipes will need to be flatter to accommodate basement depths as they will be moving services from the backyards to front yards. Frank stated that he would like to see alternatives A & B being designed separately. It was also stated that the additional storm sewer on Ash Street to be eliminated along with the slope grading at the park as those would have been City costs. Frank stated that he would like to see option 1 with the ability to reline what they can. Sabart replied that by relining the pipes, there would not be a need for residents to relocated there individual service line. Sabart advised the Council that if the project is not completed, staff will continue to have limited access. One of the biggest issues with lining the pipes is the access issue as there are no formal easements in the backyards. He concluded by stating that the Council discussed the same issues when this project was discussed in 1985. In conclusion, Schultz stated that doing nothing is an option, but not a good one. Schultz made a motion to move forward with the Council being in favor of the Option 1 financing method, alternates A & B being designed as alternates and scheduling a public hearing to solicit public input on the proposed improvement costs. The motion was seconded by Wick. Discussion: Based on consensus, notices will go out to all taxpayers and the public hearing will be held on September 1. The motion passed unanimously. 2012 Preliminary Budget: The Council was presented with a draft budget, including a draft showing the impact of funding the CIP which indicates an increase to the tax capacity rate. Weyrens questioned the Council as to how they would prefer to review the budget. She stated that the Council and staff have looked at services before; however, the City only offers the basic services at this time. She stated that there are some different revenue streams that can be considered such as advertising revenues. Schultz suggested that they work off of the budget without the CIP projects. He would like to see each of the departments bring back its top priorities and add them back on a schedule. He stated that the Council would like to maintain a 0% change, but understands that that may not be feasible. Weyrens explained the need for a new HVAC system due to ongoing issues with the current system. She explained that when replacing the unit, the roof will need to be repaired as well. According to Weyrens, if the Council decides to add this to the bond issue, a public hearing will need to be held. Weyrens advised the Council that the Facilities Group met and they discussed the possibility of the former Kennedy School as well as the possibility of expanding at the current location. If the Council chooses to build a community center, the current location will not be an option. Weyrens advised the Council that they need to determine what will be included in the bond issue. She added that the proposed development that had inquired about public financing has indicated that they will finance the project separately, so the bond fund at this time has the Sewer repairs, Fire Truck, Fire Hall refunding and City Hall repairs. There was considerable discussion about the request for a new pumper truck. It was suggested that they look at purchasing a used truck. Weyrens stated that they discussed that at the last Fire Board meeting and they were concerned about the ISO ratings. Wick made a motion to conduct a public hearing on September 1 to include the new HVAC unit and roof repairs to the CIP. The motion was seconded by Symanietz and passed unanimously. There was continued discussion about the possibility of purchasing a used pumper truck. The Council originally gave the Fire Board direction to continue with the process of purchasing a new truck. Wick suggested that the City continue its bond talks and if the Fire Department is able to find a used truck that is fine. If not, they are already on the right track. They will have two weeks to look for a used truck or get bonding information to Eastvold. Weyrens stated that she will have the Fire Chief come to a future meeting to discuss the pumper truck again. ADMINISTRATOR REPORTS Intergovernmental Meeting: Weyrens advised the Council that the Intergovernmental meeting will be held on August 30 in Sartell. Hill Street — Drainage Issues: Symanietz questioned the progress on the drainage problems up on Hill Street. Weyrens replied that staff is still working on this. MAYOR REPORTS Truth in Taxation Hearings: Schultz suggested that the changes to the Truth in Taxation meetings be included in the next newsletter. Bartlett added that the Council will be approving those dates in September. Meeting with Bachman Staff: Schultz reported that he, along with the area mayors and local legislators, will meet with Bachman and her DC staff on August 25. There is no agenda at this time. Wobeqon Trail: Schultz stated that he recently met with Senator Franken's staff to discuss the extension of the Wobegon Trail. Area Mayor and Administrator Meeting: Schultz advised the Council that the area mayors and administrators met to talk about the legislative agenda and the next regional sales tax project. COUNCIL REPORTS SYMAN I ETZ APO Executive Meeting: Symanietz reported that she attended the APO Executive Meeting in place of Mayor Schultz. They reported that their server went down and they lost two years of data. They also discussed the need to have sealant put on their roof at an estimated $12,000. APO Full Board: Symanietz stated that the APO Full Board meeting for next week has been cancelled. WICK —No Report LOSO Hill Street: Loso questioned if Sabart had yet had a chance to follow up on the drainage issues on Hill Street. Sabart responded that shortly after construction, a drain tile was constructed. He stated that he is less optimistic that the City can provide relief at this time. In hind sight, storm sewer should have been constructed with the project. FRANK Bicycle Racks: Frank stated that there have been some requests for bicycle racks downtown as a way to attract people downtown. Wick replied that there was discussion on this; however, there was nothing budgeted for this. Thene will work on pricing them out. Frank suggested that staff work with the private property owners to find a location. Adjourn: Wick made a motion to adjourn at 9:10PM; seconded by Symanietz and passed unanimously. r • eyr nistrator