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16200 Eagle Creek Avenue S.E.
Prior Lake, MN 55372-1714
CITY COUNCIL AGENDA REPORT
MARCH 20, 2006
100
STEVE ALBRECHT, DIRECTOR OF PUBLIC WORKS
CONSIDER APPROVAL OF A STATUS REPORT FROM THE WATER
TREATMENT PLANT BUILDING COMMITTEE
Introduction
The purpose of this agenda item is for the City Council to consider two
recommendations from the Water Treatment Plant committee.
Historv
On January 3, 2006, the City Council created the Water Treatment Plant
Committee (WTPC) to provide the Council with recommendations regarding
the project process. The committee consists of Council member LeMair,
Councilmember Dornbush, Finance Director, Public Works Director and
Streets and Utilities Supervisor.
Current Circumstances
On February 28, 2006, the WPTC convened and considered several issues
related to the Water Treatment Plant process. Two issues related to
community involvement were identified that require City Council consideration
at this time. These issues are:
1) Referendum Regarding Plant Construction
2) Appointment of Residents to the Committee
The WPTC reviewed information provided by Finance Director Ralph Teschner
regarding the use of a referendum. This information included an opinion from
the City's Bonding Consultant Briggs and Morgan. A copy of the Briggs and
Morgan letter is attached to this report. This letter did not recommend an
advisory referendum for this project. Our consultant noted that "Advisory
elections are invalid and ineffective and an unauthorized expenditure of public
funds unless specifically authorized by state law." The ramifications of an
advisory referendum could be the loss of the tax-exempt status of bonds to
finance the project. The actual ramifications are unknown as we are unaware
of any City that has held an advisory referendum regarding the Construction of
a Water Treatment Plant when no tax increase is contemplated or referendum
authorized.
Councilmember Dornbush has expressed concern with the committee
dismissing the advisory referendum and wants to ensure the City Council
considers the issue thoroughly. The WPTC recommends that that a Town
Meeting be held to discuss the Water Treatment Plant and water rates. This
will allow the City to present information to the public and for the Council to get
feedback on the proposed plant.
R:\Agenda Reports\Mar 20 2006\wtp report agenda. doc
www.cityofpriorlake.com
Phone 952.447.4230 / Fax 952.447.4245
In addition to the Town Meeting the WPTC is recommending that the Council
allow staff to solicit applications from the public for two additional members to
the WPTC. The WPTC recommends that a community at large member and a
resident from the Brooksville Hills or Cardinal Ridge neighborhoods near the
plant be appointed. These members will be very valuable in communicating
the project process and soliciting input from citizens.
ISSUES:
If the City proceeds with the project, the earliest construction could begin at
this point is spring of 2007 with completion late in 2008. The proposed plant
will contain 1.5 to 2 million gallons of underground storage that is vital to the
City. This storage could be constructed separate from the plant; however, the
costs for the ground storage would increase substantially as a stand-alone
facility.
FINANCIAL
IMPACT:
Minimal; there may be some minor staff and publication costs associated with
the WTP Town Meeting.
ALTERNATIVES:
1. Direct staff to schedule a Town Meeting for the Water Treatment Plant.
2. Direct staff to solicit and interview applicants for two resident positions
on the WPTC.
3. Deny this agenda item for a specific reason and provide staff with
direction.
4. Table this item to a certain date in the future.
RECOMMENDED
MOTION:
Alternatives #1 and #2.
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Reviewed by: Fr~~~les, pity ~anager
R:\Agenda Reports\Mar 20 2006\wtp report agenda. doc
BRIGGS AND MORGAN
2200 FIRST NATIONAL BAN"i."BUiLDiNG
332 MINNESOTA STREET
SAINT PAUL MINNESOTA 55101
TELEPHONE (6511 808-6600
FACSIMILE 16511 808-6450
PROFESSIONAL ASSOCIATION
WRITER'S DIRECT DIAL
(651) 808-6484
WRITER'S E-MAil.
jboulton..~briggs.com
January 20,2006
VIA EMAIL (rtesehner@citvofDriorlake.eom)
Ralph Teschner
Finance Director
City of Prior Lake
16200 Eagle Creek Avenue SE
Prior Lake, MN 55372-1787
Re: City of Prior Lake Question on Advisory Election
Dear Ralph:
The question has been raised asking whether the City of Prior Lake can hold an election
asking voters whether the City should issue bonds to finance a water treatment facility project in
the City. Because of the statutory authority contained in Minnesota Statutes, Chapters 444 and
429 which permits general obligation revenue bonds to be issued without an election for a water
treatment facility, an election would be considered merely advisory. Advisory elections are
invalid and ineffective and an unauthorized expenditure of public funds unless specifically
authorized by state law. In this case, there is no state law which authorizes one. Attached are
several Attorney General Opinions reflecting that principle.
If you have any other questions, please do not hesitate to contact me.
Very truly yours,
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JB/ja
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