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HomeMy WebLinkAbout2012 [02] Feb 02 February 2, 2012 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 2, 2012 in the St. Joseph City Hall, opening the meeting with the Pledge of Allegiance. Members Present: Mayor Rick Schultz, Councilors Dale Wick, Renee Symanietz, Steve Frank, Bob Loso and City Administrator Judy Weyrens City Representatives Present: City Finance Director Lori Bartlett, Police Chief Pete Jansky and City Engineer Randy Sabart Others Present: Tom Klein, Karen Young, Taleiza Calloway, Dave Gruenes, John Kramer PUBLIC COMMENTS No one present wished to speak. Approve Agenda: Symanietz made a motion with the additions of the following to the agenda: 8c — Rental Housing 9a — Lobbying Efforts The motion was seconded by Wick and passed unanimously. Consent Agenda: Wick made a motion to approve the consent agenda as follows: a. Minutes — Requested Action: Approve the minutes of January 5 and January 19, 2012. b. Bills Payable — Requested Action: Approve check numbers 044994 - 045040 and EFT # 00634- 000638 c. Firefighters- Requested Action: Authorize the hiring of three replacement firefighters; Cory Molitor, Mike Folkerts, and Ronald Schmidt. d. Gambling Report — Requested Action: Accept the 4th Quarter 2011 Gambling Report. The motion was seconded by Loso. Discussion: Symanietz thanked the new firefighters for stepping forward and volunteering. The motion was passed unanimously. John Kramer, Greater St. Cloud Development Corporation: Dave Gruenes and John Kramer, representing the Greater St. Cloud Development Corporation approached the Council. Gruenes stated the GSDC (Greater St. Cloud Development Corporation) was started in April 2011. The genesis was to have a private /public sector development effort within the region with an emphasis of engaging the public and private sector. There are 66 current investors in the partnership, consisting of 3 cities, 3 counties, and the balance private business and institutions. The initiative invited the public and private sector to make an investment in the Corporation to build a stronger economic community. As of this time the GSDC has raised twice the investment as anticipated. At this time Gruenes introduced the CEO of the GSDC, John Kramer. Gruenes stated that Kramer is an experienced economic developer who has been successful in revitalizing depressed communities. Kramer stated that engaging leadership is the key to succeeding and he is excited to be part of the revitalization of the greater St. Cloud area. He stated that it is evident that the community is willing to be a partner in the venture, as the investors include a wide range of industries including education, medical, government, companies doing business internationally, etc. Understanding what the problems are along with engagement of the community is vital to the success and the St. Cloud area has already illustrated the engagement by the number of committed investors. Kramer stated a key component to the revitalization is talking to the existing industries to see what they are experiencing in the current economy and what they see for the future of their company. One of his first tasks was to inventory the existing businesses in the area, to which he has a list of 650 businesses. Part of development is completing business retention visits to gain a greater understanding of the February 2, 2012 Page 2 of 5 business and discuss their goals for five (5) and ten (10) years. Investors in the Greater St. Cloud Corporation will be trained to complete these interviews as they are part of the process, and engagement is key to success. The structure of the GSDC will include the following committees: Business Retention and Expansion (Chair, Dave Gruenes), Innovation (Chair, Gordy Meyer), Downtown Development (Chair Dr. Potter), Talent (Chair Kathy Gaalswyk), Air Service (Chair to be determined), and Wellness (Jason Bernick). It is hoped that all investors will be part of one of the aforementioned committees. Wick questioned how the GSDC is going to engage the public sector with the budgets being as they are. Kramer stated it is not about budgets. He asserted that if the region is given a plan for the next five years, there won't be a problem raising money for implementation. Also the leadership has to include leaders from every sector of the community. Loso questioned if St Joseph decides to be part of the GSDC, what it would receive for its investment short term and /or long term? Kramer answered that the need is to start looking at things regionally. If a company employs 500 people in St. Cloud, only about 10 percent actually live in St. Cloud. This region has a market of about 250,000 people and it needs to be looked at in that way or each area will fail. Schultz questioned how to find the talent for the companies seeking to find employees for the positions they need to fill? Kramer stated the way to find the talent is to look to the alumni of the various area educational institutions and market opportunities in the St. Cloud area. This method can yield high returns. Symanietz stated she believes it is backwards. She questioned why companies don't help kids through college then hire them. Kramer answered that can happen but companies are looking for seasoned employees, those with 10 —15 years of experience. Jansky stated that he has a spouse that commutes to the Twin Cities area for engineering and while she would like to work in the St. Cloud area, wages and benefits are not competitive. Jansky questioned how the GSDC manages competitive wages and recruitment. Kramer stated that part of contacting alumni from the area institutions is to determine why they are not working in the area and what has to happen in the local market to make that transition. Wick questioned being that the tax structure in Minnesota is different than Iowa and South Dakota, does the corporate tax need to be changed in Minnesota? Kramer answered that it is important to look at the whole tax, not just corporate tax. The other states use different taxes to make up for what they don't tax corporations, but it is still taxing the company. Kramer closed by stated that he is confident that the GSDC will be successful and he does not fail and has successfully helped communities such as Fargo. He is excited for the challenge and looks forward to working with the investors of the St. Cloud area. Bond Refunding: Weyrens stated that originally bond counsel, Monte Eastvold of Northland Securities was scheduled to attend the meeting to discuss a potential refunding opportunity; however due to circumstances beyond his control he could not be present. Weyrens stated that as bond counsel for the City, Eastvold monitors the City debt for opportunities to save interest by refinancing debt. Due to the declining rates in the bond market, the City has an opportunity to refinance the 2005D GO Water Revenue Bonds that are callable in 2014. When Eastvold first contacted the City Administrator approximately 30 days ago, the net interest savings was' approximately $ 295,000 and today the net savings has increased to approximately $ 500,000. Finance Director Lori Bartlett stated the Average Coupon Rate of the 2005D bonds is 4.13% and the projected average coupon rate, based on the current market is estimated to be 1.91%. This decrease in interest expense contributes to an overall reduction in future debt service payments of approximately $487,338. This is a true savings figure in that all issuance - related expenses have been taken into account. The average interest rate on 20 -year bonds has reached a level not seen since April 1967. Moody's Al rating is assumed for the refunding based on the rating analysis of the most recent bond issue in the fall of 2011. The size of the refunding would warrant a bond rating. February 2, 2012 Page 3 of 5 Under the Dodd -Frank Act starting in 2012 the bonding underwriter and financial advisor must be separate entities. In addition, the role of underwriter and financial advisor must be in writing for each bond issue. Firms acting as underwriters may switch roles before bonds are sold to financial advisor, but must be done in writing and cannot be in the reverse order. In order to expedite the bond sale, it is recommended that Northland Securities fulfills the role of underwriter. This will also allow the city to "lock in" an interest rate when rates are most favorable. To assure that the best rates are locked, it is recommended that the Mayor and Administrator are appointed to act on behalf of the Council to lock in on the interest rate when it is in the best interest of the City. Loso made a motion to authorize Resolution 2012 -002 appointing Northland Securities to act as the underwriter for the 2012 crossover water refunding bonds and appoint the Mayor and Administrator to lock in favorable interest rates for the bond issue; seconded by Frank passed unanimously. Karen Young, Xcel Energy — Discussion on Downtown Power Poles: Karen Young, Xcel Energy appeared before the Council at their request to discuss the potential of burying the overhead power poles on Minnesota Street. She stated that relocating power poles is a common request of communities and many are aware of recent projects such as Richmond and Sauk Rapids. It is the policy of Xcel that if a community wishes to convert the overhead power service to underground, the cost is the responsibility of the community. The Public Utilities Commission has provided a surcharge /tariff provision whereby communities can bill residents for the underground conversion. The cost could range between $ 4.50 and $ 5.00 per month and will only be billed to Xcel Energy Customers. Young stated that she has met with Weyrens previously and the cost to convert the lines is more complex in St. Joseph than in a community such as Richmond. The downtown of St. Joseph includes two different service stations, provides main service to the College /Monastery of St. Benedict and has a geographical area for burying that is constricting. When looking at Minnesota Street it becomes difficult to see where the power boxes could be located. The green boxes that can be seen in residential areas where service is underground are the same type of facilities that would need to be located on Minnesota Street, only they equipment would be larger. Young also stated that if the City is serious about relocating the lines, Xcel would request a $ 5,000.00 deposit which will be used for designing or engineering the new system. The City would need to decide the exact project location as it is costly to design. When questioned if the power lines could be relocated to alley, Young stated that could be a possibility; however, the Council needs to keep in mind that if the power is relocated, individual businesses will have additional costs to relocate their power service. Currently businesses along Minnesota Street have service lines in the front and moving the service to the back will require a new service line to each businesses and this could be costly for some businesses. The Council requested clarification on the billing for the relocation and if only the customers serviced by Xcel would be billed as half the community is served by Stearns Electric and if the City could bill a large user such as the College a higher proportion. Young stated that only the Xcel customers would be billed for the relocation and the cost must be the same for each service. Weyrens questioned if the franchise fee could be opened to allow for billing to both companies and to allow for a larger fee for the larger users. Young stated it would be opportunity but she would need to review the provisions before providing a definitive answer. Young suggested that before the City makes a decision to request the re- design of the overhead power lines on Minnesota Street, the staff along with the engineer from Xcel walk the project area to look at alternatives and opportunities. It was agreed that Weyrens, Thene, Sabart and Wick (representing the EDA) will meet with representatives of Xcel and report back to the Council. Young thanked the Council for asking her to come answer questions they have regarding the power lines on Minnesota Street. She stated the Minnesota Street pole line is a complex line to move or underground. COMMITTEE REPORTS February 2, 2012 Page 4 of 5 Facilities Committee: Weyrens reported that the Facilities Committee interviewed three architect firms (Hagemesiter Mack; GLT; Negen) on January 23. All three firms used the existing facility and expanded the footprint to accommodate the needed space. The biggest issue outlined is parking for the Community Center. The Committee will be meeting on February 6, forwarding a recommendation to the City Council on February 16. Transportation Committee: Sabart reported that the Transportation Committee met recently and Scott Mareck of the St. Cloud APO provided general information on transportation planning. The committee reviewed the current network system and will be meeting again in February. APO Technical Advisory Meeting: City Engineer Randy Sabart reported that the St. Cloud APO TAC met to discuss and rank proposed projects for federal funding for calendar year 2014. The City of St. Joseph submitted a funding request for the 2 phase of the trail adjacent to new CR 2; however the project did not receive a favorable recommendation to move forward. In fact, no trail projects are being forwarded to the APO Executive Committee for funding. Symanietz stated that she will continue to lobby for funding for the Wobegon Tail and interconnections. ADMINISTRATOR REPORT Sales Tax Extension: Weyrens reminded the Council that at the Intergovernmental Meeting held on January 31, the importance of hiring a lobbyist to assist with the sales tax extension was discussed. The Cities were provided the fee for two different firms ranging from $ 10,000 to $ 40,000. Loso stated that he does not support hiring a lobbyist as the Mayor of St. Cloud, who is a former legislator, did not support the expense. In fact, he indicated that it could be counterproductive. Schultz stated that he does not disagree with Loso and the City always has the opportunity to go back to the legislature next year if the Cities are not successful this year without a lobbyist. Weyrens stated that all Cities are being asked to take formal action on the hiring of a lobbyist and St. Joseph is the first City considering the hiring of a lobbyist. The City has the option of recommending the hiring of a specific lobbyist, not supporting a lobbyist, hiring a lobbyist not to exceed and established • contract price, or approving with a contingency that all City's participate and the cost is divided equally amongst the six Cities. Wick questioned if the fee is not divided using the distribution formula. Weyrens stated that since all Cities are receiving the same benefit from the service, it is proposed to divide the fee for service equally between all six Cities. Schultz made a motion to hire a lobbyist to assist the area Cities with the extension of the half cent sales tax provided the contract price does not exceed $ 10,000.00 and all six cities participate dividing the cost equally. The motion was seconded by Wick. Ayes: Schultz, Wick, Symanitez, Frank Nays: Loso Motion Carried 4 :1:0 COUNCIL REPORTS SYMANIETZ — No Report WICK EDA Update: Wick reported that the EDA met on January 25 at which time they reviewed the proposals for Economic Development services and agreed to renew the contract of Municipal Development Group. They also discussed the language in the enabling resolution as it relates to membership and will be forwarding a recommendation to the City Council for possible amendment. Loso responded that changes to the enabling resolution are the responsibility of the Council. Wick concurred and stated that the EDA is only forwarded a recommendation to the City Council for a public hearing. Wick also stated that the EDA has agreed to move the monthly meeting from 3:00 PM to 5:00 PM. February 2, 2012 Page 5 of 5 LOSO — No Report FRANK — No Report MAYOR REPORTS Housing Committee: Schultz reported that the housing committee reviewing the current rental regulations will be meeting soon. When questioned on the names of the committee members, Schultz responded the committee will consist of: Michael Deutz, Cory Ehlert, Roger Schleper, Roger Steichen and Ross Rieke. APO Personnel Committee: Schultz reported that he is on the personnel committee for the APO and they received 27 applications for senior planner and they will be reviewing applications and candidates. Schultz also reported that he become a grandpa today for the second time and he will be conducting a listening session on Saturday, February 11 at the Local Blend from 8:30 to 10:00 am. Adiourn: There being no further business the meeting was adjourned at 8:55 PM. 4 111111■ 2j7.:A,ei/tj J , dy eyre s dmi strator THIS PAGE ,INTENTIONALLY LEFT BLANK