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HomeMy WebLinkAbout09 06 11 City Council minutes 4646 Dakota Street SE Prior Lake, MN 5537 2 REGULAR CITY COUNCIL MEETING MINUTES September 6 , 2011 CALL TO ORDER The meeting was called to order at 7 :00 p.m. Present were Mayor Myser, Council members Erickson, Ke e- ney and Soukup , City Manager Boyles, City Attor ney Pace , Finance Director Erickson, Ci ty Engi neer / I n- s pections Director Poppler, Public Works/Natural Resources Director Gehler, Water Resources Engineer Bintner, Community and Economic Development Director Rogness, Planner Matzke, Fire Chief Hartman, Assistant City Manager Kansier, Assistant City Manager Meyer and Administrative Assis tant Green. Cou n- cilmember Hedberg was absent. PUBLIC FORUM The Public Forum is intended to afford the public 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 Economic 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 appropriate for the Forum. Comments: Patrick Heaney , 4642 Pleasant Street , commented that the CR 21 reconstru ction discussion has brought forth complex ideas involv ing a lot of people and a lot of emotions regarding historic downtown . Stated he has lived in his home for 37 years. Stated he is an idealist and believes in the collective “we” for parks, roadways, etc. Has been frustrated with this topic , but thank ed Hedberg for meeting with him and having discussions that rejuvenat ed his belief in process. Believes downtown is the heart, soul and character of Prior Lake. Stated downtown was zoned TCT in 2003 (to wn center transition) which has limits for i m- provements . Believes potential blight could occur there. B elieves the Maxfield process on CR 21 was flawed b e cause no residents were involved in it. There were situations where residents became suspicious or po larized. Stated he has spo ken to more than 50 residents and none support rerouting CR 21. Co m- mented on what he believes are flaws in the plans developed in 2005. Believes CR 21 should not have a bypass, the process should freeze where it is now and more s olutions should be e x plored. Josh Johnson, 4527 Pleasant Street, posed the question of what makes P rior L ake different from any ot h- er place in the metro area. Asked if the CR 21 plan will fit within what makes Prior Lake unique. Believes if it does, it will have community support. Ron Wolfram , 4612 Pleasant Street, expressed concern about having a roadway cross the wetlands as proposed in the re alignment scenario , due to the potential of pilings being driven into the aquifer to try to stabilize the roa dway. Would like to know what studies were done to learn feasibility of going across the we t land. APPROVAL OF AGENDA MOTION BY ERICKSON, S ECOND BY SOUKUP TO APPROVE THE AGEND A AS PRESENTED . VOTE: Ayes by Myser, Erick son, Keeney and Soukup. The motion carried. Phone 952.447. 9800 / Fax 952.44 7 . 4245 / www.cityofpriorlake.com APPROVAL OF MEETING MINUTES MOTION BY SOUKUP , SECOND BY ERICKSON TO APPRO VE THE MINUTES OF THE AUGUST 1 5 , 2011 MEETING AS PR E SENTED. VOTE: Ayes by Myser, Erickson, Keeney and Soukup. The motion carried. CO NSENT AGENDA City Manager Boyles reviewed the items on the consent agenda. A. Consider Approval of Invoices to be Paid. B Consider Approval of the July 2011 Treasurers Report. C. Consider Approval of Resolution 11 - 104 to Renew Agreements with Credit Riv er Township and Spring Lake Township to Provide Fire and Rescue Services. D. Consider Approval of Resolution 11 - 105 to Close and Transfer Account Balances to the EDA Special Rev e- nue Fund. E. Consider Approval of Resolution 11 - 106 for an Amendment to the Zoning Map for Approximately 15.5 Acres of Property Located Northeast of the Intersection of CSAH 21 and Fish Point Road from R - 1 (Low Density Residential) to C - 2 (General Business). F. Consider Approval of Resolution 11 - 107 to Approve a Registered Land S urvey Involving Two Single - family Residential Properties Located Along 150th Street NE. Councilmember Keeney asked that items 5D, 5E and 5F be removed from the Consent Agenda for di s- cussion. MOTION BY SOUKUP, SECOND BY E RICKSON TO APPROVE THE CONSENT A GENDA AS MO D- IFIED. VOTE: Ayes by Myser, Erickson, Keeney and Soukup. The motion carried. Comments: Keeney : Regarding item 5D, stated that his understanding was that a preliminary budget from the E c o- nomic Development Authority (E DA ) would be brough t before the Council before any transfer of funds ; and that discussion had taken place of funding half of a position from that budget. J. Erickson: Replied that agenda item 10B includes a preliminary budget for the EDA with a special rev e- nue fund. What is different about 2012 budget for EDA compared to 2011 is that 50% of the community and economic development director position is include d as well as an additional $50,000 for professional servic es to conduct business. Myser: Asked which items on the T reasurer’s Report are part of economic development. J. Erickson: Stated that the three funds with this agenda item are fund 250 (economic development fe d- eral revolving loan fund) , 255 (the economic development Minnesota revolving loan fund) , and 256 (dow n- town redevelop ment fund), but not fund 402 which is a separate tax increment fund. Myser: Noted that $178,000 is listed in fund 402 and asked if that fund is part of economic develop ment or why is it discussed as part of an EDA transfer. Boyles: Replied that it is not contained in the agenda report, but he thought it important that the Council be aware of it. That money c ould be designated for EDA purposes . Myser: Asked which funds listed might be able to be earmarked for EDA if Council would so choose. Asked about fund 413. J. Erickson: Replied that staff will be reviewing the tax increment plans to see what flexibility we have in the funds. Certain restrictions must be followed. D iscussion for TIF 1.4 might include future of fund 402 (tax increment ) which will include looking at options for considering how funds can be used for economic development. 2 09 06 11 City Council meeting minutes Keeney: Regarding item 5E, asked if there is a map showing the property that is being discussed. Matzke : D isplayed site map showing where a stree t would separate the two kinds of zoning. Stated that bufferyard require ments will be met. Keeney: Regarding item 5F, asked if there is a map showing the property that is being discussed. Matzke: D isplayed a site map showing the requested lot transfer . Stated that landowners are transferring property ; and due to the complexity of the legal descriptions including lengthy metes and bounds descri p- tions, the recording office requested that the platting process be undertaken. Therefore, a land su r vey was u ndertaken which must be brought before the City Council for approval. Stated that the Planning Commi s- sion has approved this transfer and granted variances for lot widths. MOTION BY KEENEY , SECOND BY ERICKSON TO APPROVE RESOLUTION 11 - 106 FOR AN AMENDMENT TO THE ZONING MAP FO R APPROXIMATELY 15.5 ACRES OF PROPERTY LO CATED NORTHEAST OF THE INT ERSECTION OF CSAH 21 AND FISH POINT ROAD FROM R - 1 (LOW DENS I- TY RESIDENTIAL) TO C - 2 (GENERAL BUSINESS) ; AND RESOLUTION 11 - 107 TO APPROVE A RE G- ISTERED LAND SURVEY INVOLVIN G TWO SINGLE - FAMILY RESIDENTIAL P ROPERTIES LOCATED ALONG 150TH STREET N E. VOTE: Ayes by Myser, Erickson, Keeney and Soukup. The motion carried. MOTION BY ERICKSON, SECOND BY SOUKUP TO APPROVE RESOLUTION 11 - 105 TO CLOSE AND TRANSFER ACCOUNT BAL ANCES TO THE EDA SPECIAL REVE NUE FUND. VOTE: Ayes by Erickson, Myser and Soukup . Nay by Keeney. The m otion carried. PRESENTATION None scheduled. PUBLIC HEARING None scheduled. OLD BUSINESS Consider Approval of a Resolution Authorizing the Mayor and City Manager to Enter into the City’s Standardized Purchase Agreement for Property Located at 4580 Dakota Street (Hayes) and Auth o- rizing E x penditure of Funds. Assistant City Manager Meyer presented the purchase agreement for 4580 Dakota Street. Stated that the seller wants to sell the property “as is.” Staff had inspections done to learn the cost of bringing the property to a leasable condition. Outlined benefits and challenges of purchasing the property. Reviewed the needed repairs , the status of the retain ing wall and potential costs to repair it , and the potential rev e- nues from renting the property. Comments: Erickson : Asked if the appraised value of $160,000 meant all mechanicals are in working condition, or a s- sum ed the repair costs did not exist. Mey er : Replied that the a ppraisal was a visual and did not test the mechanics, but assumes they ope r ate efficiently. Erickson : Asked about the mold . Meyer : No dollar value was given for the cost to mitigate the mold. Erickson : Asked if the cost of work t hat needs to be done should be subtracted from the purchase price or taken care of by the seller. 3 09 06 11 City Council meeting minutes Meyer : Stated that the City has not entered into a purchase agreement in order to bring th e se costs back to the Council. The seller has indicated they are i nterested in negotiating for those repair costs. Erickson : Some items should not be passed back to the seller, such as miscellaneous repair and cleanup. The mold and replacement of the furnace should be taken care of by the seller or the cost reduced to cover that. Suggested that either $22,000 should be reduced from $160,000; or the offer of $160,000 made with the items taken care of prior to purchase . Keeney : Commented that it would cost $28,000 to put the property into rentable condition. Believe s it would be most efficient to make it into a parking lot i f that is the desired outcome as repairing and renting the property is not a good use of staff time and resources. Asked if a parking lot is needed now. Boyles : Replied that the p arking lot stud y s tates the City ha s a deficit. Stated this property would not be a major solution in the overall need for parking. Keeney : Stated it s eems to not make sense to get into the landlord business. Parking could better be pr o- vided by opening up the space b e tween the police station, dental office and library. Soukup : Understands more parking downtown is needed. Stated that two or three years would be r e- quired to recoup the costs for initial repairs and then another $90,000 would be required to change the pr operty into parking lot with no chance to recoup those costs. Does not see value in the City owning the property. Myser : Stated he d id not support the purchase at $160,000 and still does not with additional repair costs. Supports that downtow n parking needs to be addressed and would rather reserve these funds for a better parking solution. Erickson : Would support the purchase for $138,000 and have the City take care of the e x penses. Myser : Commented that the t otal cost of the parking would be nearl y a quarter of a million dollars with a cost per stall of around $20,000. Keeney: Recalled that downtown parking is projected to be closer to $5,000 per stall. MOTION BY ERICKSON TO APPROVE A RESOLUTION AUTHORIZING THE MAYOR AND CITY MA N- AGER TO ENTER IN TO THE CITY’S STANDARDIZED PURCHASE AGREEMENT AS MODIFIED FOR THE PURCHASE OF PROPERTY LOCATED AT 4580 DAKOTA STREET SE, AND AUTHORIZING E X- PENDITURE OF FUNDS FOR PURCHASE OF THE PROPERTY IN AN AMOUNT NOT TO EXCEED $ 138,000 . The m otion failed for lack of a second. NEW BUSINESS Consider Approval of a Report on an Update to the Municipal Separate Storm Sewer System Permit and Adoption of a Resolution Supporting LMC Efforts to Modify MS4 Requirements. Water Resources Engineer Bintner stated that the Minnesota Pollution Control Agency (MPCA) issues the MS4 permit. The c urrent permit is expired, but the City can operate under the expired permit until a new one is issued. The Total Minimum Daily Loads (TDML) are a prescription for an individual water body that s ets a pollution target and then local authorities must devise means to reach those targets. The r e- newed permit is anticipated to be less flexible in allowing local resolution of water resource pollution control and the City’s current water resource manage ment would have to change if the MPCA permit is not r e- vised. Many locally tailored solutions have been put forward and the new permit may change that. The League of Minnesota Cities along with its Minnesota Cities Stormwater Coalition has submitted comme nts in response to the draft pe r mit. Comments: Soukup : Asked the status of the LMC and MN Cities Stormwater Coalition petition . Bintner : Replied that the p ublic comment period closed at the end of last month. He e xpect s some changes will happen. W ait ing for response . 4 09 06 11 City Council meeting minutes Soukup : Asked h ow many cities are involved. Boyles : Replied there are 855 cities in the League. Bintner : Added that this permitting covers the MS4 regulated cities and about 90 cities have chosen to join LMC’s stormwater coalition . Soukup : Asked about the c ost per pound of removing phosphorus and whether that cost will trickle down to resident’s water bill s . Bintner : Cited advantages the City has in cost containment such as the engineering legwork being done to achieve cost effic iencies, owning the land where the treatment happens and working on a regional basis. Keeney : Asked the reasonable expected outcome of receiving significant revisions to the pe r mit. Bintner : Believes the chances of change are good as people begin to underst and cost of implementing the proscribed processes . Keeney : Asked what the driving force is behind trying to establish the stricter rules. Gehler : Responded that although Prior Lake is doing quite a bit to reduce pollution from stormwater, the same level of efforts are not being put forth statewide . Costs would go up if a site by site basis for trea t- ment is required . We tak e a regional approach to treatment and are asking them to let us look at what is best for our City in treating stormwater . Erickson : Asked Bintner to outline what has been done to help prevent some of the expenses that would be incurred. Bintner : Replied the City is putting projects together by calculating per pound cost and life cycle costs and calculating how to spread the projects over several sites rather tha n restric t ing ourselves to a single site or single practice. Practices include iron enhanced filtration systems, street sweeping program, etc. The total solution is not yet written, but it is anticipate d to inclu de a mix of practices. Erickson : Queried whether this new permitting process w ould restrict us from using the innov a tions. Bintner: Responded that the City would want the freedom to plan a process over a period of time using the practices that will work for that area. Myser : Read from the LMC letter to the MPCA regarding arbitrary and capricious requirements. Asked about the process they go through and whether they had any rulemaking during the stakeholder process . Bintner : Rulemaking might happen on a variety of issues ahead of a permit process. LMC is suggesting that if the permit in its current form had legal basis in the rulemaking process, the rules would look different now if they were legally supported. Myser : Asked if this was done by staff at MPCA, who was participating and who would have signed off on this. Bintner : Replied t h e d ecis ion to approve it would be the c ommission er and agency at citizen’s board le v el. Myser : Seems they may have overstepped their bounds. Hope s that some of th e work we have been doing as a broader water quality group in Scott County to reach out to meet representatives from DNR, BWSR and MPCA to share with them some of the cost - effective work we have been doing will help them understand there are better ways to go about this. Support s getting behind the LMC on this action. MOTION BY SOUKUP, SECOND BY KEENEY TO APPROVE RESOLUTION 11 - 108 REQUESTING M INNESOTA P OLLUTION CONTROL AGENCY CONSIDERATION OF REVISIONS TO NEWLY PR O- POSED MUNICIPAL SEPARATE STORM SEWER SY S TEM PERMIT . VOTE: Ayes by Myser, Erickson, Keeney and Soukup. The motion carried. Consider Approval of a Resolution Adopting Proposed 2012 City Budgets and Certifying Prelim i- nary 2012 City of Prior Lake Tax Levy to Scott County Department of Taxation. Finance Director Erickson r eviewed details of the 2012 prelim inary budget and tax levy. Stated that the Truth in Taxation meeting is scheduled for 7 p.m. on December 5 , 2011 in City Hall. Explained variances between the 2011 and 2012 General Fund budget . Reviewed proposed personnel changes for 2012 d e- scribing the variances from the 2011 fund budgets. Stated this budget results in a zero change in the tax 5 09 06 11 City Council meeting minutes levy from 2011 . Spoke of the factors that have an impact on property taxes: valuation, classifica tion and levy, and provided current the status of those items. Reviewed the m arket v alue e xclusion recently enacted by the State. Comments: Keeney : Noted that the Mayor and Council portion of the proposed budget has been increased 4% over 2011. Asked the c ost of l iving adjustments calculated for personnel as well as the anticipated costs of step increases and health insurance costs . Meyer : Replied that approximately 2% is calculated for COLA . S teps are included in the budget assum p- tions and rate incr eases from the coop for health insurance are identified to be 4%. Added that a health insurance task force represented by all employee groups is considering what other plan options are avail a- ble and what those rates would be. Hopefully, that will save m oney for the City and the employee s in the long term. J. Erickson: Steps equate to $80,000 which is about 0.8% for the General Fund budget. Keeney : Commented that as a policy matter, the General Fund shows an increase of 3 .6% and an overall increase of 1.65%, with an attempt to get service levels back to the level of 2008. Believes that is the wrong direction. Stated one of the reasons the budget level in 2010 was set was because we felt we were spending more than we can afford. Stated that, from an a ffordability side, he does not want to make this increase and does not want to add new positions this rapidly. Believes the City needs to have fewer e m- ployees per capita. Supports removing the 4% increase from the City Council budget as a symbolic ge s- tu re. Erickson : Remarked the market value exclusion is not a City policy, but rather a State policy. Asked if people must live in the home to receive the exclusion. J. Erickson: Affirmed, noting that the homestead class i fica t ion still exists. Erickson : Commented it is commendable to have put together a budget with a zero percent levy conside r- ing that it includes monies to take care of deferred maintenance that has not been funded to this point. The City is beginning to plan ahead and set money aside to handle such expenses in the facility management and equipment management funds. Believes the two proposed positions are needed. Supports the pr o- posed budget. Reiterated that this is a preliminary budget and represents the maximum amount to be l e- vied. Sou kup : Asked about the contra revenue account with $260,000 and asked if that has been on the books for three years . J. Erickson: Replied that amount is not cumulative , but rather is the amount for 2011 and represents an aid payment from the State. Such a id payments have not been received since 2008 . Soukup : Asked what happened with the numbers from previous years. J. Erickson: A negative revenue has been budgeted in previous years. Explained that municipalities work on a cash basis vs. accrual basis so tax revenues are not recognized until they are r e ceived. Soukup : Clarified that going forward th is line item will not exist. Queried the hours for the utility billing clerk. J. Erickson: Replied that position will be going to 32 h ours per week and is a non - benefit position. Soukup : Stated that when consider ing services to citizens and the things for which the City is responsible, much of the information is generated by staff and the finance department. Believes that d ecisions are o n ly as good a s the information that is provided and a nother accountant is needed. Asked the level of accoun t- ing capacity that is anticipated . J. Erickson: Replied that a professional l evel accountant, bachelor level with municipal experience is d e- sired . Soukup: Suppo rted the need for a police supervisor position citing situations where the level of service has not been par. Stated she is n ot willing to jeopardize th e necessary level of service. Supports the two positions and the proposed b u d g et. 6 09 06 11 City Council meeting minutes Myser: U nderstands that even when setting a levy of $10.1 million in 2010, the City only expect ed to r e- ceive $9.855 million because the aid for the State was not expected to be collect ed . The change to market value exclusion will effectively mean a zero levy is really goin g to be a 2.5% increase. Now , the levy we charge, will be the levy we co l lect. J. Erickson: Commented that , as discussed at the August 15 work session, if the levy is kept the same it would result in an increase because of the exclusion and moving the funding from the State to the res i- dents. Myser : Asked where the level of reserves is at with actual performance. J. Erickson: Replied that after the second quarter, the City was at a $200,000 increase in reserves . Third quarter actual s are being prep ared for October. Myser : So this proposed budget shows current expenditures running $44,000 less than budgeted. This results in the fourth year that the City will have an excess . J. Erickson: Affirmed that is $44,000 showing budget to budget. Myser : Does not support increasing the number of employees. Do es support the additional money in the facility maintenance budget . Feels a responsibility to the residents to return the money they have paid in and s upports lowering the levy at this point and redu cing the reserves now rather than holding onto it for a longer period of time. Supports a levy of less than $9.855 and using reserves. J. Erickson : Commented that Council has discussed use of fund balance reserves and called out in a f i- nancial policy a nd the capital improvement program what the reserves would be used for such as the facil i- ties management fund and the technology fund. There are uses for the fund balance reserve that are e s- sential for funding those other plans and a number of uses have a lready been identified for a significant portion of the reserve. Noted that the purchase of the Hayes property was going to use some of the r e- serve fund and that is now off the table. Myser : Concurred those expenditures are planned over multiple years. The reserve has approximately $7.3 million. Supports the technology plan and the purchase of new financial software as well as some of the positions over a couple of years. Stated the t arget for reserves is 45% of 12 million and there is now an excess of that and he would prefer to give some of it back. Erickson : Stated there seems to be agreement that the police supervisor is necessary and that the m o- nies set aside for facilities management and technology is necessary as well as the targeted level of r e- serves . Stated he does not agree on a one year big hit for reducing the levy as it could then result in a one year big hit in increase s . Believes there s hould not be radical changes from year to year, but rather the changes should be spread it out over several years in a planned manner. Myser : Believes that return ing the reserve in one fell swoop prohibits people from getting used to it. Asked Erickson what he would be willing to give back over what period of time. Erickson : Replied that a three - year period with discussions about the proper amount for a working bud g et seems reasonable . Keeney : Agreed that a zero levy increase actually proposes to collect the money that we were not getting from the State. Proposed that to have integrity and say that t he levy is not being increased, he would have to go with a $ 9.855 million levy . Stated he takes issue with saying we paid dearly for not having police s u- pervisor, and rather believes there were issue s with specific employees. The City Manager makes perso n- nel decisions and the Council should not micromanage where the dollars are spent on a case by case b a- sis. Believes the City should not increa se the number of staff . Stated he is a p roponent of a smaller levy that is no higher than $ 9.855 million, but i s unsure that should all come out of reserves. Concurs with a gradual reduction of reserves; but does not believe the proper use of reserves should be increased sp en d- ing. Soukup : Sought clarification on a zero increase of the levy asking if the $259,0 00 contra revenue a c count was just for one year and whether it was applied to the levy in the same sense that it is being applied now . 7 09 06 11 City Council meeting minutes J. Erickson: Replied that in 2011 the credit was $ 259,000. The levy was established at a higher level b e- cause it was k nown that the money would not be received. The amount i n previous years was less per year . It is a one - time annual adjustment, but it is not a credit that is artificially r e ducing the tax levy. Soukup : Asked if the City knows that the aid will not ar rive from the State during the budget process . J. Erickson Have known about it each year since 2008 so it has been included in the budget as a credit. Soukup : Asked the time line discussed in work sessions for bringing down the reserve . J. Erickson: The long range financial plan was a five year plan. Soukup : Commented that m any programs from the State are going to go away and cutbacks will conti n ue . Reserve situations can be considered either a negative or a positive. Believes the City needs to be pr e- pared for future cut backs and assure it does not experience a deficit. Commented that it s eems to be a split C ouncil. Myser : Asked Soukup if she suppor t s a levy increase for a $ 10.1 million o r $ 9.855 million. Soukup : Supports $ 10.1 million. Myser : Expressed belief that this is an accounting mechanism and the money collected was $ 9.855 mi l lion so that is the true levy ; and if it is changed from that, it is being increased. Soukup: The proposed budget reflects the anticipated expenditures for the ye ar. Reiterated that this is a preliminary budget and additional work sessions are planned to refine it. MOTION BY ERICKSON, SECOND BY SOUKUP ADOPTING A RESOLUTION APPROVING THE PR O- POSED 2012 CITY BUDGETS AND CERTIFYING PRELIMINARY 2012 CITY OF PRIOR L AKE PRO P- ERTY TAX LEVY TO SCOTT COUNTY DEPARTMENT OF TAXATION AS PROPOSED BY STAFF . VOTE: Ayes by Erickson and Soukup. Nays by Myser and Keener. The m otion failed. MOTION BY KEENEY, SECOND BY MYSER TO ADOPT A RESOLUTION APPROVING THE PR O- POSED 2012 CITY BUDGETS WITH THE TOTAL LEVY REDUCED TO $9,855,000 AND GENERAL FUND EXPENDITURES REDUCED BY A CORRESPONDING AMOUNT AND CERTIFYING PRELIM I- NARY 2012 CITY OF PRIOR LAKE PROPERTY TAX LEVY TO SCOTT COUNTY DEPARTMENT OF TAXATION. VOTE: Ayes by Myser and Keeney. Nays by Erickson and Soukup. The motion failed. Boyles : Referred to State Statute 275.065 which states that if the taxing authority fails to certify its pr o- posed levy by the due date, the County Auditor shall use the pr evious year’s final levy for th e purposes of determining proposed property tax notices and public advertisings. Noted there are complexities in adm i- nistering that. J. Erickson: Stated that it is c omplicated by debt obligations. Parts of debt service levy would increase , specifical ly the market value levy for the referendum debt. There is also EDA lease revenue debt which is tax capacity based. Pieces of the levy need to increase to fulfill the obligations to pay the debt. Asked Cindy Geis to add information regarding tax capacit y vs. market value levies. Cindy Geis , Scott County , stated she is the m anager of the p roperty c ustomer s ervices area which deals with the Planning and Zoning Office, the County Surveyors Office, the Taxation Office, the Recorders O f- fice, the Elections O ffice and the Customer Service area as well as serving as the appointed County Aud i- tor/Treasurer. Addressed what happens when a levy is not adopted. Stated the County would take the levy as adopted last year to be the proposed levy. The market value lev y will be increased because by St a- tute , cannot levy less than the amount of the debt is unless there is money in that reserve fund to cover that particular bond. Anticipates that the General Fund levy will be reduced by the same amount that the ma r- ket val ue levy is i n creased. Myser: Asked the debt service amounts. 8 09 06 11 City Council meeting minutes J. Erickson: Debt in the General Fund for EDA lease revenue was increasing $14,748; d ebt associated with market value referendum debt was increasing $ 23,160 . Debt with the capital improvemen t program was declining $84,855. Myser : Concluded that the net difference is a reduction. Geis : Commented that t he problem is that the market value debt fund needs to go up and that is a different tax base . Even though the debt service has enough to co ver other debt service funds that are not market value driven, but tax capacity base driven ; whether you reduce the debt service levies that are net tax c a- pacity driven or the General Fund, the increase to the market value levy is going to show differently . On the property tax statement the market value taxes show differently than the other city taxes on the final tax statement. Myser : Clarified that the net effect is to increase the market value levy, but it will be taken from the tax c a- pacity base l evy. Geis : The law changed approximately four years ago which granted authority to take last year’s final levy and use it as the proposed levy . Keeney : A sked if action is needed to set time and place for public informational meetings. Geis : Notice sho uld be taken to set a public information meeting to talk about tax levy; and certification is needed to provide what the current debt service levels are for net tax capacity based debt as well as ma r- ket value based debt so the County has final numbers. Oth erwise, State law requires go ing back to the ori g inal debt service fund bonds and levy all of the dollars regardless of the what debt service levy fund balance is. Need to know which funds have enough reserve in it and which do not as well as establishmen t of the pu b lic meeting on budget and tax levy. MOTION BY KEENEY , SECOND BY ERICKSON FOR THE CITY COUNCIL TO CONSIDER THE 2012 GENERAL FUND, DEBT SERVICE, REVOLVING EQUIPMENT FUND, EDA SPECIAL REVENUE FUND AND ENTRPRISE FUND BUDGETS AND THE FINAL 2012 P ROPERTY TAX LEVY DURING ITS REG U- LARLY SCHEDULED COUNCIL MEETING AT 7 P.M. ON MONDAY, DECEMBER 5, 2011 AT 4646 D A- KOTA STREET SE, PRIOR LAKE, WITH A CONTINUATION (IF NECESSARY) AT 7 P.M. ON DECE M- BER 19, 2011. VOTE: Ayes by Myser, Erickson, Keeney and Souku p. The motion carried. Geis : Noted that any reserve balance that will be used to offset debt service requirement would have to be adopted by resolution. Myser : Asked if that could be done with the final levy. J. Erickson: S uggested using the third “ whereas” in the proposed resolution to state there are sufficient fund balance reserves and adopt the debt service portion reflected there. Myser : Clarified that it is the $2,835,610 amount. J. Erickson: Affirmed that is the levy associated with the de bt that we would want to adopt and state that there are sufficient funds to cover any remaining balances; and the net of that would be adjusted against the general tax levy. Keeney : Sought clarification of what the general tax levy was last year. Geis : Stated she needs a s tatement certifying that there are enough funds in the reserve funds to manage the debt with the ex c eption of the bonds that are the market value based bond s . Those could be pointed out as needing increases and leave the rest as a gene ral statement without specifying how much is ge n eral levy . Suggested that with a split vote, the Council would not want to get into approving a levy line item of any sort or it may be perceived as the total levy. MOTION BY ERICKSON , SECOND BY KEENEY TO SUPPLY A STATEMENT TO SCOTT COUNTY THAT THERE ARE ENOUGH FUNDS IN THE RESERVE TO MANAGE THE DEBT WITH THE EXCE P- 9 09 06 11 City Council meeting minutes TION OF BONDS THAT ARE MARKET VALUE BASED. THE MARKET VALUE BASED BONDS MAY NEED INCREASES TO SATISFY THE DEBT SERVICE. VOTE: Ayes by Myser, E rickson, Keeney and Soukup. The motion carried. Consider Approval of a Resolution Amending the Special Assessment Policy City Engineer / Inspections Director Poppler reviewed the sections of the policy and the proposed changes to them. Noted that chan ges must be made to City Code in order for this proposed assessment poli cy to comply. Comments: Soukup: Understands this action is needed to make the assessment policy consistent with State Statute. Asked if the assessment policy can be changed as need ed. Poppler : Affirmed, stating there have been 11 changes since 1989. Erickson: Commented on the interest rate charged for assessments, stating the current rate is high and there should be a non - arbitrary calc u lation for assessment rate. Boyles : State d that the Assessment Review Committee looks at each assessment and that is an item they discuss. Questioned whether it should specifically be set out in the policy as assessments m ight be for v a- rying lengths. Erickson : Replied there should be some kind of guideline on the interest rate so it is not arbitrary . Keeney : Support ed the concept of standardization of the interest rate. Myser : Stated that the Assessment R eview C ommittee meet s on Thursday and staff could bring it up at the meeting. S upports st andardization of the interest rate . Keeney : Commented that there have been issues in the past with lots that have shared driveways. B e- lieves that when there is commercial property abutting more than one street of a residential area there is value in havi ng rear access to commercial proper ty and assess ment of that access should be in the pol i cy. Myser : Concurred with Keeney’s comments. Asked how the fees relate to those in other commun i ties . Poppler : Replied that City fees were determined through a s tudy done in the mid - 2000’s and are b ased on what the City needs to put in a new development. Myser : Asked if an independent third party studied the cost and came up with the fee amount s . Poppler : Replied that the 4% and 5% fees are based on projects and history. The extraordinary costs are billed to the developer. In some cases, we refund some of the costs if a project uses less than the fees co l- lected. Myser : So both administration and construction observation could be refunded if the anticipated cos t is not used. Poppler : Construction observation fees could be returned, but administration fees are not. Boyles : Reviewed the history of Prior Lake in trying to charge based on a rational nexus by calculat ing what our costs are and basing fees on tho se actual costs. Myser : Asked if our costs are in line with other cities. Boyles : Believes e veryone has a different way of charging the rates and it can be difficult to track. Myser : Asked if the differentiating ways of doing business between cities i ncrease s the cost for develo p ers to learn the different ways that cities do business. Asked if it can simplified for develo p ers. Pace : Replied it is not complicated and is detailed in the developer’s contract that they sign. Stated she is opposed to loo king at what other cities charge and then charging that . A f ee justification study was co n- ducted with the Builders Association in the Twin Cities and one of the largest developers at the time. A committee was formed and a methodology agreed upon , which w as subsequently ado pted by BATC and other c i ties. Boyles : Summarized the revisions the Council would like to have addressed in the assessment policy. Pace : Commented that the previous policy identified an 8% interest rate, which was removed because tha t was deemed arbitrary. Stated that staff c an come up with something that is tied to an appropriate i n dex. 10 09 06 11 City Council meeting minutes MOTION BY ERICKSON, SECOND BY KEENEY TO DIRECT STAFF TO AMEN D THE ASSESSMENT POLICY TO ADDRESS LO TS THAT HAVE SHARED DRIVEWAYS, ADDRESS C OMMERCIAL PROPE R- TIES THAT ABUT RESID ENTIAL AND HAVE ACCE SS TO MULTIPLE STREE TS, AND ESTABLISH STANDARDS FOR INTERE ST RATES, VOTE: Ayes by Myser, Erickson, Keeney and Soukup. The motion carried. OTHER BUSINESS Community Events Erickson: Firefighters will host the 32 annual c hicken BBQ on September 11 from 3 - 8 p.m. Money goes nd to the relief fund which goes to members and community. Keeney : Added that the cost for the BBQ is $12 for adults, $6 for kids. Soukup : To day is first day back at school. Asked every one to watch out for the little ones. Wished ISD 719 a good school year. Myser : The Mayor’s Cup will be run at Raceway Park in Shakopee on September 9. A portion of the money raised goes to the local food bank. ADJOURNMENT With no further comments fr om Council members, a motion to adjourn was made by K eeney and seconded by E rickson . With all in favor, the meeting adjourned at 10:13 p.m. ___ _______________________________ __ ________________________________ _ Frank Boyles, City Manager Charlotte G reen, Administrative Asst. 11 09 06 11 City Council meeting minutes