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HomeMy WebLinkAbout2015 [07] Jul 20 July 20, 2015 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 Monday, July 20, 2015 at 6:00 PM in the St. Joseph City Hall, opening the meeting with the Pledge of Allegiance. Members Present: Mayor Rick Schultz, Councilors: Dale Wick, Bob Loso, Matt Killam, Renee Symanietz. City Administrator Judy Weyrens Citv Representatives: City Engineer Randy Sabart, Police Chief Joel Klein, Finance Director Lori Bartlett, Public Works Director Terry Thene Others Present: Alex Miller, Mary Filzen, Ellen Wahlstrom, Ed Zimny, Jane Fuchs, Monte Eastvold, Ed Zimmy . Public Comments Ellen Wahlstrom approached the Council regarding the water amenity. Wahlstrom noted the operation and maintenance of the facility will affect the tax payers. Wahlstrom added that the proposed revenue is going to cover all the expenses, which she believes is unrealistic. Wahlstrom stated she wants the correct information. In the report, there are going to be 36 staff to monitor the facility. Wahlstrom calculated that there will be only 9 people monitoring the facility at one time. There are many unanswered questions regarding the operation and maintenance of the amenity.Wahlstrom requested answers to the questions so that the public is aware of the correct information. Aqenda Apqroval: Loso made a motion to approve the agenda with the addition of item 9b, Announcements.The motion was seconded by Wick and passed unanimously. Consent AQenda: Symanietz made a motion to approve the consent agenda as follows;seconded by Loso and passed unanimously. a. Minutes-approved;the minutes of July 6, 2015 b. Bills Payable-approved payment of check numbers 049444-049515, Payroll EFT #001083-001087 and Accounts Payable EFT#00 9 696-001 699. c. Variance Request—accepted the recommendation of the Planning Commission granting a finrenty foot variance from the public right of way to Ken & Kenna Frie, 109 Ash St W. d. Interim Use Permit—accepted the recommendation of the Planning Commission and issued an Interim Use permit to Melissa Welsh for a non-owner occupied rental at 38 Birch St E. e. Donations—accepted the following donations: Anonymous—Disc Golf$26.11; Archery Range$110.00; Millstream Camping $154.01; Aquatics Brochure$75.00. f. Treasurer's Report—accepted the 2"d Quarter 2015 and June 2015 Financial Reports as presented. g. Fire Relief—acknowledged the 2014 Report indicating a$0.00 liability for the 2016 Relief Contribution. h. Street Closure—authorized the street closure of a portion of College Avenue and MN Street for the Millstream Arts Festival on September 27, 2015. Public Hearing, Small Cities Block Grant: Weyrens reported the City partnered with Central Minnesota Housing Partnership (CMHP) in 2014 seeking funding for housing rehabilitation through the small cities grant program administered by DEED. The grant would provide funding for qualifying low to moderate income residents to complete certain home improvements. The City was awarded a small cities grant in the amount of$525,000 and the City had an additional $66,000 from a previous block grant that was used to increase available funding to near$600,000. The target area for the grant program is 1�Ave NE to Birch Street to 4tgh Ave NE/5th Ave Se to Baker Street and back to 15t Ave Se. Weyrens added that funding is provided as a 0%, deferred, forgivable loan with a seven year term. As a requirement of the program, the City is required to conduct a public hearing regarding the status of the grant program. Mayor Schultz opened the public hearing for comment. July 20, 2015 Page 2 of 5 Ed Zimny, CMHP, the program manager representing the Central MN Housing Partnership approached the Council to provide an update on the grant program. Zimny reported that of the$525,000 awarded, $349,531 has been allocated. With the additional$66,218 of non-grant funds added, the remaining amount of grant funding is$175,469. Zimny added there have been 15 projects completed, 4 projects under construction, 3 in the bidding stage, and 2 applications in the verification stage. Loso questioned the term of the grant. Zimny stated applications can be submitted up until December 2015. CMHP will work with the City to apply for an extension if need be. Zimny added that part of the program includes adopting a section 3 plan reaching out to low to moderate income persons for employment, as it relates to the housing grant and to adopt a program income plan. Zimny stated the program income plan comes into play if a person sells their home within 7 years of the rehabilitation of the property. If the sale occurs, the owner will need to pay back a portion of the loan. The section 3 plan is geared towards hiring low to moderate income contractors possibly helping some of the local businesses as well as residents in the community. Loso questioned where any extra grant money will go if not used for additional rehabilitation projects. Zimny stated if the grant extension is not awarded, Deed will reclaim an excess fudning. Schulz questioned the possibility of extending the rehab to other areas in the City. Weyrens stated staff has encouraged people within the target area to apply by placing additional information in the bi-monthly newsletter. Loso asked if the target area can be changed. Zimny stated it can be requested, but is unsure if that request will be granted. As no one else present wished to speak, Schultz closed the public hearing. Loso moved to adopt the Section 3 Plan and Program Income Plan for the SCDP Community Development Block Grant.The motion was seconded by Wick and passed unanimously. Debt Management Stud� Monte Eastvold, Northland Securities, approached the Council to present the 2015 Debt Management Study. The Study provides information of what the required tax levies and other revenue sources should be,what debts might be a candidate to refund or payoff early, how many years remain on each debt, and the summary of the debt costs versus the requirements to pay the total debt. Eastvold stated that as in previous years, the Debt Management Report is formatted the same. Eastvold presented each issue and how they are funded. The purpose of the study is to provide a financial summary of the debt, reviewing the solvency of each debt service. Wick questioned if tax levies will need to be increased in issues where there is only one year showing deficit. Eastvold responded that each issue will need to be looked at separately. If there are projects that have prepaid assessments, that could increase the tax levy. Eastvold added that the yearly review is completed to address issues that may need to increase the tax levy. Finance Director, Bartlett noted that the fund balance amounts include the 5%coverage that is required by state law. If the 5% is removed, most of the issues can be funded using their respective fund accounts. Eastvold noted that Improvement Bonds of 2014 were issued to finance the Park Terrace improvement project. The bonds are payable from special assessments, annual tax levies, and additionally secured by unlimited ad valorem taxes. This issue will need to be watched closely from year to year as there is a projected deficit cash flow fund balance starting in 2022. Eastvold stated there are 24 current bond issues. Looking at the tax levies, the City will see slight increases over the next finro years, but then decreases will be seen from that point onward. Starting in year 2025-2030, the cash flow fund balance shows a deficit. July 20, 2015 Page 3 of 5 Wick asked why the payment amount for the Water Revenue Crossover Refunding Bonds increases from 162,458 in 2016 to 561,908 in 2017. Eastvold stated the issue was refinanced and that the water rates will not have to be increased significantly to cover the increase in payment. 2015 Debt Issue: Eastvold reported the City received an upgrade in their bond rating from an A+ to an AA-, which is the first upgrade in several years. The new rating provides the City with more bond buyers bidding lower interest rates. Eastvold presented two bond issues, one for the improvement bonds and certificates, and the other for the abatement bonds. The bond will be issued as one issue to save on financing costs. The funding sources for each project include debt levy and special assessments. The abatement bonds will show revenue sources as debt levy however actual payments will be made using half cent sales tax revenue. The abatement bond assumes the City will pay$506,000 cash for the school purchase. The cash will spend down a portion of the half cent sales tax fund. Wick made a motion authorizing the Mayor and Administrator to execute resolution 2014-024 providing for the issuance and sale of$77Q,000 general obligation bonds,series 2015A, pledging for the security thereof special assessment and levying a tax for the payment thereof.The motion was seconded by Schultz and passed unanimously. Symanietz made a motion authorizing the contract between the City and Northland Securities.The motion was seconded by Wick and passed unanimously. The second bond issue is the tax abatement issue. The bond issue goes until 2030 with an average interest rate of 2.73%. The longer you go out with a bond issue, the higher the interest rate. Eastvold noted that at the pubfic hearing, the estimated tax levy would be around $164,000. The first year would be around that amount for the tax levy,�but the City would then see decreases in tax levy amounts thereafter. Eastvold stated the intent is ta have the sales tax revenue offset the tax levy. Wick made a motion authorizing the Mayor and Administrator to execute resolution 2014-025 providing for the issuance and sale of$1,870,000 general obligation tax abatement bonds,series 20156, providing for their issuance and pledging for the security thereof abatements for the payment thereof. The motion was seconded by Symanietz and passed unanimously. Symanietz moved to authorize the contract between the City of St.Joseph and Northland Securities.The motion was seconded by Loso and passed unanimously. Committee Reports Plannin4 Commission: Schultz reported the Planning Commission had two public hearings, one for an owner occupied rental, and the other a for variance request. Both were recommended for approval by the by the Planning Commission, and were placed on the consent agenda. Water Amenity—Update/site/soil borinclslplans:Wick reported the committee met and went over the schematic drawings. A few changes have yet to be made and the drawings will give the committee a better idea on what the flow rates are going to be and what pumps are needed. Wick stated the committee recommended getting soil borings in order to layout where each of the pieces of the amenity will be. The soil borings will cost up to$8,000. Killam added the report will include additional details on the financial pieces of the amenity such as cost, possible admission packages, and operational costs. Wick made a motion to move forward with the soil borings not to exceed $8,000. The motion was seconded by Killam. Motion failed. Aye: Killam,Wick Nay: Schultz, Loso, Symanietz Motion Failed 2:3 July 20, 2015 Page 4 of 5 Discussion: Symanietz is concerned with the amount of water at the site being that a large portion of it is wetlands. Loso added he wouid not like to expend any further funds on the project until further fundraising is substantial. If the soil borings are not approved, than the City will not be able to know if fhe site can be used for the facility. Killam stated that the reason$8,000 is being allocated to the borings is due to the number of boring that will be completed. Symanietz added that the agenda states the line item is shown as only an update and residents do not think that any action will be taken at the meeting. Engineer Reports Update on 2016 MSA Proiects: Sabart presented the Council with an overview of MSA(Municipal State Aid)funding. Sabart stated that annually the City receives approximately$144,525 for the construction fund balance and $48,173 towards the maintenance fund. The funds are kept by the State and when a project is approved for use of the fu�ds, the funds are released as reimbursement; therefore, the City must expend the funds and then apply for reimbursement. The current state aid fund balance is approximately$1.4 million. State aid has a rule that fund balances that have a balance over$1.5 million, have too much money in the fund and could reduce future allocations. Schultz questioned if funds are dedicated to future projects, can the City still accrue money. Sabart stated that the funds have to be spent. One of the benefits of receiving state aid is that cities are able to borrow ahead against future contributions. It is encouraged for cities to go into a negative balance as it shows that additional funds are needed. Cities are able to borrow up to 5 times their annual allotment. The Council has previously identified the construction of the south easbwest corridor as a potential project for 2015. The first step in a street project is authorization for the feasibility report, to identify the scope of the project. Sabart stated the feasibility report will focus on three options, project costs, and calculating the preliminary assessments. It will focus on the extension to 7th Avenue from College Avenue. Loso made a motion authorizing the City Engineer to complete the feasibility study of the SFJW Collector Street utilizing MSA funds for the cost of the study.The motion was seconded by Schultz and passed unanimously. Proiect updates: Sabart reported that the 2015 Street Improvements have been started in Northland and Clinton Village. Park Terrace: All properties are connected to the new sewer system and the contractor is working on completing the punch list. After completion the next step would be to put the final layer of blacktop. Main Pump Station: The project is almost complete with just a few punch list items left. Administrator Reports Budaet 2016: Weyrens reported that the Council has discussed the budget at each meeting, the summary of items has been updated and includes any status or work items that have moved the issues forward. Announcements: The movie in the park has been rescheduled for Tuesday, July 21, 2015. The Lego Movie will be shown at Millstream Park around 8:45 PM. Mayor Reports ColYs Academv: An inspection was completed on Colt's Academy and one of the major items of concern is the asbestos in the boiler room. It is a warning, but not necessarily a hazard. Schultz direeted Weyrens to fbrward the information to the City's attorney adding the City will not move fonNard until the costs to of removing the asbestos are known. July 20, 2015 Page5of5 Loso asked when the tour of the facility will be completed. Schultz stated that the asbestos will hold that up. The tour was going to take place after the purchase agreement. Symanietz wants to see the schooi prior to the signing of the purchase agreement. Weyrens stated the agreement has already been signed and she will work on setting up a tour. City Hall Committee: Schultz reported the committee of 8 people has been finalized: Derek Larson, Marge Lesnick, Jodi Terhardt, Colleen Petters, Matt Loehlein, Frank Osendorf, Margy Hughes, and Mary Nimmerfroh. Schultz added that for continuity, Symanietz and himself wil� be on the committee as well. Schultz does not see the meeting being more than one or finro. Meeting times and dates are not finalized. APO: The APO is having their human resource policies reviewed to match those across the state. They are looking to include incentives for employees in order to address the turnover rate. The presentation will be at the beginning of August and will be brought to the Council. New Business The Millstream Arts Festivai will be on September 27th, 2015. Adjourn: Loso made a motion to adjourn at 7:30 PM; seconded by Killam and passed unanimousfy <'`�� C�" ,..e�'L� u y W� ns i Ad inistrator