Loading...
HomeMy WebLinkAbout08 01 11 City Council minutes 4646 Dakota Street SE Prior Lake, MN 55372 REGULAR CITY COUNCIL MEETING MINUTES August 1 , 2011 CALL TO ORDER The meeting was called to order at 7 :00 p.m. Present were Mayor Myser, Council members Erickson, He d- berg, Keeney and Soukup , City Manager Boyles, City Attor ney Pace , Finance Director Ericks on, City Eng i- neer /In s pections Director Poppler, Public Works/Natural Resources Director Gehler, Assistant City Mana g- er Kansi er , Assistant City Manager Meyer and Administrative Assis tant Green. PUBLIC FORUM The Public Forum is intended to afford the pu blic an opportunity to address concerns to the City Council. The Public Forum will be no longer than 30 minutes in length and each presenter will have no more than ten (10) minutes to speak. Topics of discussion are restricted to City governmental topics rather than pr i- vate or political agendas. Topics may be addressed at the Public Forum that are on the agenda except those topics that have been or are the subject of a scheduled public hearing or public information hearing before the City Council, the Ec onomic Development Authority (EDA), Planning Commission, or any other City Advisory Committee. The City Council may discuss but will not take formal action on Public Forum presentations. Matters that are the subject of pending litigation are not appropri ate for the Forum. Comments: No person stepped forward to speak. APPROVAL OF AGENDA MOTION BY SOUKUP, S ECOND BY ERICKSON TO APPROVE THE AGEND A AS PRESENTED . VOTE: Ayes by Myser, Erickson, Hedberg, Keeney and Souku p. The motion carried. APPROVAL OF MEETING MINUTES MOTION BY HEDBERG, SECOND BY SOUKUP TO APPRO VE THE MINUTES OF THE JU LY 18 , 2011 MEETING AS PR E SENTED. VOTE: Ayes by Myser, Erickson, Hedberg, Keeney and Soukup. The motion carried. CONSENT AGENDA Ci ty Manager Boyles reviewed the items on the consent agenda. A. Consider Approval of Invoices to be Paid. B Consider Approval of June 2011 Building Report. C Consider Approval of the 2nd Quarter 2011 Financial Reports. D. Consider Approval of the 2nd Q uarter 2011 Investment Reports. E. Consider Approval of Resolution 11 - 089 Approving a Temporary On - Sale Liquor License for Prior Lake At h- letics for Youth (PLAY). F. Consider Approval of Resolution 11 - 090 Identifying the Funding Sources for the Boudin's P hase I Improv e- ment Project (City Project #11 - 011). G. Consider Approval of Resolution 11 - 091 Identifying Funding Sources for Right of Way and Easement A c- quisition for the Arcadia and CR 21 Intersection Improvement Project. Mayor Myser requested that ite m 5C be removed for comment. Phone 952.447. 9800 / Fax 952.44 7 . 4245 / www.cityofpriorlake.com MOTION BY HEDBERG, SECOND BY KEENEY TO APPROVE THE CONSENT AGENDA AS MODIFIED . VOTE: Ayes by Myser, Erickson, Hedberg, Keeney and Soukup. The motion carried. Myser : Queried the number of building permits actual vs. budget ed. J. Erickson : Replied that when comparing permits this year vs. last year it should be noted that there was an incentive program for the first half of last year which may have been driving those numbers. It is anti c- ipated that the number of building p ermits this year will exceed the number budgeted. New development is anti c ipated in the second half of the year. Myser : Queried about revenues at 80% of budget for licenses and permits. J. Erickson : Replied that the category is comprised of business licenses and liquor licenses. Noted that the annual liquor licenses were approved in the first half of the year. Building permit revenue is reflected at 66% of budget as of June 30 and includes things such as mechanical and plumbing permits which will h ave increased activity as the number of building permits increases. Myser: Queried about the w ater revenues being significantly under 50% . J. Erickson : Replied that water revenues are about $ 70,000 less than last year. Believes it is likely due to si gnificant rainfall this year and less water used for watering lawns. Myser : Asked if there are any potential concerns for the water fund . J. Erickson : Replied that the budget remains constant from year to year even though use can fluctuate . Noted that t his report includes three billing cycles , but that only reflects use through May 20. There is m ore water use in the summer so revenue will be coming in. Stated that the sewer revenue is comparable to last year and does not fluctuate as much as there are sewer caps in place for the remainder of the year. Myser : Commented that the personnel expenses were significantly lower than expected for mid - year in the water quality fund . J. Erickson : Replied this expense is consistent with the previous year. Expe nditures reflected in re ports are delayed so this activity is for approximately mid - May. Hedberg : Asked if it is anticipated to be caught up by the end of the year. J. Erickson : Affirmed. Stated that staff has been incorporating some items for which inf ormation can be easily obtained and built into reports , but c ash basis items are delayed. Myser : Queried about transit . Erickson : Replied the City has an additional bus this year . Ridership is up 15% and revenues are coming in. Myser : Asked if the JARC is bus included in the budge t or if this only reflects an increase in ridership Kansier : Replied that she did not budget the JARC bus and did not know what kind of ridership to anti c- ipate for it. Stated that m ost other providers have had a 7 - 8% increas e without additional buses, so the JARC bus might account for about half of the increase. Myser : Asked if there is greater usage of JARC than anticipated. Kansier : Acknowledged that a better use of reverse commute and having th e option increases ride r s hip in both morning and afternoon. Expects that higher gas prices also contributed to increased ridership. Keeney : Noted that the fire department expenditures are behind budget and asked if that is seasonal or based on the number of fires this year . J. Erickson: Replied that personnel costs for fire are now being paid monthly rather than quarterly and the report reflects one month in arrears of activity. T here are a number of maintenance and operational items that will be pursued in the next few months that should show up in the next qua r ter. MOTION BY SOUKUP, SECONDED BY HEDBERG TO APPROVE ITEM 5C, 2 QUARTER 2011 F I- ND NANCIAL REPORTS. VOTE: Ayes by Myser, Erickson, Hedberg, Keeney and Soukup. The motion carried. 2 08 01 11 City Council meeting minutes PRESENTATION None scheduled. PUBLIC HEARING Public Hearing to Consider the 2012 - 2016 Capital Improvement Program (CIP) and Street Reco n- struction Program. City Engineer / Inspections Director Poppler stated that the CIP is made up of several plans : transpo r- tation, equipment replacemen t, park equipment replacement, water operating, sewer operating, water qual i- ty operating, technology and facilities management. Work sessions have been held throughout the year to talk about the individual plans in detail. Stated that the s treet reconstr uction plan is a five - year plan that coordinates with the transportation plan and uses street reconstruction bonds for funding . Poppler hi g- hlighted the projects planned for 2012 . Finance Director Erickson spoke of financial implications for the CIP . Using PowerPoint, displayed c u- m u lative impact of debt indicating that , with the exception of 2013, the overall debt level trend declines through 2021. Displayed the anticipated t ax levy revenue need through 2021. Stated that CIP debt and operational cos ts will require increased fees for sewer and water costs , and s uggested incremental i n- creases rather than implementing a large increase at one time. Displayed the impact of water/sewer fees on an average user . Noted that the C ity is receiving MCES increa ses nearly every year. Stated that use of Ge n eral Fund reserves is anticipated for a new financial system, time tracking system and property permit tracking. MOTION BY KEENEY, SECOND BY ERICKSON TO OPEN THE PUBLIC HEARING. VOTE: Ayes by Myser, Erick son, Hedberg, Keeney and Soukup. The motion carried and the public hea r- ing opened at 7:35 p.m. Comments: No person stepped forward to speak. MOTION BY HEDBERG, SECOND BY SOUKUP TO CLOSE THE PUBLIC HEARING. VOTE: Ayes by Myser, Erickson, Hedberg, Keen ey and Soukup. The motion carried and the public hea r- ing closed at 7:36 p.m. Comments: Keeney : Noted that there are a number of new items in the CIP that did not previously have this kind of long term planning. Queried the amount of money planned for a concession stand at Sand Point Beach in 2020 asking if it included roadway or an y thing besides a building. Friedges : Responded that when the master plan for facilities was being compiled, a life guard training area was included in the building. Now tha t the City no longer has life guards, the size of the building will prob a bly be reduced . Keeney : Noted there is a spike in expenditures in the facilities management plan for 2024 . U nderstands that it is because there is a 20 - year life cycle built in for the equipment in building s . Questioned whether it is anticipated that everything will be replaced at 20 years. Friedges : Replied that manufacturer ’ s recommendations for life span were used when compiling the ma s- ter plan , but a good maintenance program can prolong life expectancies of building equipment. 3 08 01 11 City Council meeting minutes Keeney : R eiterated that not every piece of equipment is expected to be replaced in 20 years but rather will be replace d as needed over the life of the building. Asked if the street transportation pla n has the Sunset Avenue / CR 12 Phase 4 factored into 2013. Poppler: Affirmed that project has been moved forward from 2016 to address the sewer situation on Su n- set. Stated the Annexation Task Force needs to meet again for discussion and evaluation on t his and other items. Erickson : Commented that the CIP plans have been discussed at length in work sessions. Asked Friedges to talk about the inventory and database programs that assist with the planning. Friedges : Responded that u ntil recently the inven tory of publ ic buildings was not documented, but now all equipment has been inventoried and entered into a database along with the anticipated life expectancy and current valuation of each item. An inflationary factor for replacement has been calculated. Maintenance costs associated with each building are tracked and used to calculate future year expenses. Erickson : A dded that all of these s teps will enhance transparency about actual costs. Soukup: Stated she supports incremental increases for water/ sewer rates and c alculated that the cumul a- tive increase could be as much as $29 per billing cycle over the next five years. Commented that the pe r- centage of reduction of reserve in the general funds is planned to move from 55.4% down to 43.5% and she supp orts that agreed upon amount. Hedberg : Noted that the combination of the facilities management plan, the technology management plan and purchase of the Hayes property totals about a $1 million use of reserves . When the facilities and tec h- nology managemen t plans were discussed in work sessions , items that were past - due obligations such as replacing the financial software that is nearly 30 years old were identified . These p lans are part of trac k ing of things that are needed to know to run a city. Supports use of reserves to fund the items identified. Commented that the Arcadia intersection project is independent of the decision to be made about CR 21. Stated the Arcadia intersection n eeds to be done for safety reasons. I t was identified to the City by th e County and State that the intersection on Main / CR 21 cannot be left as it is and if a decision is not made by City leaders about how to change it, the decision will be made by others. Noted that other projects on the CIP include bringing City sewer an d water to Sunset Avenue and maintenance of the outlet channel for Prior Lake. Will support the pr o posed CIP. Myser: A sked about the plans that include operating expenses. J. Erickson: Responded that certain op erating expenses are estimated which are ca lculated in conjun c- tion with capital improvement projects to learn the need for rate changes. Myser : Commented that other expenditures are not included in the CIP. J. Erickson: Replied that the o riginal purpose of these plans w as to develop a rate analy sis which would include operational expenses and capital improvement programs. Stated she would not be opposed if e x- penditures were not included, but believes it c reates a broader picture of why we might be looking at a change in rate. Myser : Concurre d we need to have the communication, but it is different from capital that is needed to i n- vest in the City. W ould like to see those three items not included in the CIP but rather dealt with separate from capital. Queried what the debt balance per househ old would be. J. Erickson: Stated that information is included in the annual financial report and it could also be included in the debt analysis in the CIP. Myser : Asked why Fire Station No. 1, the maintenance center and the water treatment facility sh ould have fiber optic connections. Poppler : Responded the buildings are currently using radio waves and fiber optics would provide a more stable connection without the downtime. Much monitoring equipment is located at the se facilities . Noted that the c onduit was installed during construction in preparation of the fiber optic connection and all that remains is running the wire. 4 08 01 11 City Council meeting minutes Meyer : P rovided background. Stated the wireless antenna providing service to Fire Station No. 1 is no longer operational. C urrently the m aintenance center is on a point - to - point T1 system paid for by Integra. Stated the communication system for the City is dissected and there is opportunity to connect to the Scott County fiber optic sys tem. Myser : Sought clarification on s liplining. Poppler: Replied that $150,000 per year is scheduled to do standard sliplining of sewer lines. This t renc h- less technology allows lining of sewers to prevent infiltration of ground water into the system and e xtends life of the equipment. Mys er : Asked why the water storage item is needed. Poppler : Replied item identifies a new water tower for the north side of the lake near the Wild’s area which has been in the CIP for a number of years. St ated it is st ill in question following the study with SMSC r e- garding water use. At the conclusion of the study the City will evaluate if a new well is needed or if a par t- nership will be established with SMSC. Keeney : Asked if it would be beneficial to have long range revenue and operating plan for eve ry thing that would go hand - in - hand with the CIP . Commented that the Council looks at the fund balances, debt ba l- ances, reserve balances and impact on tax levy when making plans . Not sure if it should be separate do c- u ment or if it is effective to do other than look at it with the long range plan and process. Would be suppo r- tive of a process to have that formalized. Hedberg : Commented on things regarding the operating funds for the sewer and water quality: 1) capital portion should be considered with t he overall CIP; 2) rate stud ies are separate action , but to be able act on them we have to act on a combination of everything ; 3) the combined operating plan will be acted upon when there is more detailed analysis on the operating budgets. Recommended the capital portion be a p- proved as part of CIP and separate action to approve rate plans. J. Erickson: Responded that the Council is not being asked to adopt rates at this time; that would norma l- ly be done at the annual meeting. Stated that t hese document s are plans which are then incorporated i n to the annual budget, rates, etc. Hedberg : Suggested that the CIP components of these operating plans be segregated for consideration with the rest of the CIP. J. Erickson : All of the capital purchases are in th e CIP narrative detail as well as in transporta tion plan. MOTION BY HEDBERG, SECOND BY KEENEY TO DIRECT STAFF TO PREPARE RESOLUTIONS FOR APPROVAL OF THE 2012 - 2016 CIP AND STREET RECONSTRUCTION PLAN FOR THE AUGUST 15, 2011 CITY COUNCIL MEETING. VOTE: Ay es by Myser, Erickson, Hedberg, Keeney and Soukup. The motion carried. J. Erickson: Queried whether the intent is to include operating plan s in the final document. Hedberg : Responded it should just be the capital plans . OLD BUSINESS No ne scheduled. NEW BUSINESS Consider Approval of a Resolution Authorizing the Negotiated Sale of $3,295,000 General Oblig a- tion Street Improvement Bonds of 2011. Finance Director Erickson stated that this bond issue would combine street improvement s for Phase I of Boudin ’s area; right of way for the CR 21/Arcadia intersection project; and the re - fund of the General Obl i- gation and tax increment bond s from 2004. Introduced Steve Mattson of Northland Securities , Inc. Mattson reiterated that $1.6 million is needed for the i mprovement project s and $ 475,000 for the Arcadia i n- 5 08 01 11 City Council meeting minutes tersection. Explained that the 2004 bonds are callable in December . Stated there is a favorable interest rate market right now. The bond for $ 845,000 has an exis t ing rate of 3.37% and he expects to get 0.082%. The TIF bond from 2004 was at 4.77 % which is expected to change to 2.62% . Anticipates that the n et present value of the two bond issues will save around $50,000. A Moody’s rating call is scheduled and he anticipates receiving a continued good ra ting . Co m mented that the City’s plan to spend the reserves down to 45% over five years should not damage the credit rating. Anticipate s bringing the bond contract to the August 15 meeting for a p proval. Comments: Soukup : Commented that the Aa 2 rating from Moody’s is substantial. Supports taking advantage of the favorable market. Hedberg : Clarified that r e - funding of two bonds will save $50,000. Mattson : Affirmed stating the City s hould save $ 56,000 to $ 58,000 over the entire term. Keeney : Asked w hat fees the City will be paying . Mattson : Referred to Use of Funds, Cost of Issuance line item of $27,755 which represents fees to la w- yers for bond consult, Moody’s rating fee, Payne agent registrar fees and miscellaneous fees. Other i s- suance fees go to the underwriter to sell the b o nds , pay a commission to the salesman and fees that go Northland Securities for putting the package together. Keeney : All of the fees are still less than 1.8% on the short - term monies and 2.88% on the TIF package. Will s upport. Erickson : Asked if the federal financial discussions and state shutdown will affect the City in this action . Mattson : Believes it will be more of a problem for small cities that depend on local government aid. State scenarios do not affect Prior Lake much because of our good financial standing. Rating agencies might send a message to Congress that it cannot do this at final moments with a reduction of the Nation ’s Aaa ra t ing . Believes people might consider P rior L ake a better buy than the feder al government. Co m mented that the m arket has been assuming a default will not happen , but no one else out there is a benchmark. If something catastrophic on the national level would happen, Northla nd staff would delay action on this package. Erickson : Asked if it is the best time to do this now. Mattson : Replied he will probably wait until two weeks from today to go to the market. Myser : Suggested that Mattson and staff put in context that the City has been adding to the surplus for the last 9 - 10 y ears during the upcoming ratings call. J. Erickson: Responded that a broad range of subjects is discussed : all funds, recent financial reports and the 2030 Vision and Strategic Plan. Stated that Moody’s understand s that the City has a long - term plan and is fo l lowing it. Myser : Asked if there are any other bonds that are callable and reasonable to move on. Mattson : Replied that the City has about $ 36 million in debt in three primary bond issues. Bonds done in 20 05, 20 06 and 20 07 will be coming up to their call feature in 2013, 20 14 and 20 15. The largest issue will be in 2013 . If called sooner, there would be a 2% penalty on negative arbitrage. Believes interest rates will not go up any time soon so opportunities should be good at that time. Myse r : Asked if the expense s should be a pportioned to the refinancing of n ew bonds . Mattson: Responded that the City would have saved approximately $ 70,000 , but the $ 50,000 reported is the net. MOTION BY SOUKUP, SECOND BY HEDBERG TO APPROVE RESOLUTION 11 - 092 AUTHORIZING THE NEGOTIATED SALE OF $3,295,000 GENERAL OBLIGATION STREET IMPROVEMENT BONDS OF 2011. VOTE: Ayes by Myser, Erickson, Hedberg, Keeney and Soukup. The motion carried. 6 08 01 11 City Council meeting minutes Consider Approval of a Resolution Authorizing the Purchase and Convey ance of Tax Forfeited Property. Finance Director Erickson stated the City received notice of properties that are going into tax forfeiture. Described the properties. Explained that the County notifies the entity most appropriate for conveyance of the pro perty to learn whether it would seek to have properties withheld from public auction. Comments : Erickson : Thinks the properties could be of benefit to the city. Will support. Keeney : Stated he does not believe the City would be interested in all of th e prope r ties. J. Erickson : Commented that tonight’s action would only be to hold the properties from auction so more research could be made for a determination of public purpose. Keeney : Believes the only properties the City might be interested in would be the Rutledge and Butte r nut properties. J. Erickson : Concurred that the Wilds Ridge could be developable and should go on the auction. Staff would like to look into the Red Oaks property further. Noted that even though the property is under water, th e DNR has stated it is not interested in it . Boyles : Stated the City does not need to make a decision about any particular property at this time. B e- lieves the City would recommend having the DNR tak e the Red Oaks property and if they do not want it, the n the City could determine whether it would want it. Keeney : Will support . Hedberg : C ommented that the Red Oaks property should be in public hands so a private party would not take any action that would restrict lake access to the homeowners in that bay. Soukup : Will support. Myser : Will support. MOTION BY HEDBERG, SECOND BY SOUKUP TO APPROVE RESOLUTION 11 - 093 RELATING TO TAX FORFEITURE PROPERTIES. VOTE: Ayes by Myser, Erickson, Hedberg, Keeney and Soukup. The motion carried. OTHER BUSINESS Com munity Events Soukup: Lakefront Days begin s on Thursday. There is information about specific activities on the We b- site. Hedberg : Announced that Dan Rogness has been hired for the Community and Economic Development Director position and b egins September 1. Boyles : Provided a biography of Rogness’ work experience. Erickson : Noted that Millar and Diamondhead will be playing at Lakefront Days. Stated that CR 21 is e x- pected to be open for use in August. Myser: Announced a joint EDA and EDAC meeting on August 8 at which Maxfield Research will present a study about Prior Lake commercial and industrial demand . ADJOURNMENT With no further comments from Council members, a motion to adjourn was made by Keeney and seconded by Soukup. With all in favor, the meeting adjourned at 8:51 p.m. _ ___ _______________________________ __ ________________________________ _ Frank Boyles, City Manager Charlotte Green, Administrative Asst. 7 08 01 11 City Council meeting minutes