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10-17-1991 CC MIN - SPECIAL tit SPECIAL MEETING OF THE ELK RIVER CITY COUNCIL HELD AT ELK RIVER CITY HALL THURSDAY, OCTOBER 17, 1991 MEMBERS PRESENT: Mayor Tralle, Councilmembers Schuldt, Kropuenske, Dietz, and Holmgren MEMBERS ABSENT: None STAFF PRESENT: Pat Klaers, City Administrator; Lori Johnson, Finance Director; Bill Rubin, Economic Development Coordinator; and Sandra Thackeray, City Clerk 1. Call Meetinl to Order Pursuant to due call and notice thereof, the meeting of the Elk River City Council was called to order at 6:35 p.m. by Mayor Tralle. 2. Consider 10/17/91 City Council Alenda It was the consensus of the CHy Council to accept the 10/17/91 City Council agenda as presented. e 3. Discussion Relardinl Industrial Park Purchase Pat Klaers indicated that the Council discussed the issue of purchasing the remaining lots in the Elk River Industrial Park in a favorable manner at previous Counci I meetings. He indicated that the Counci I should reach a final decision as to whether or not the City will pllr'chase the remaining lots in the Elk River Industrial Park for $210,000. Pat Klaers indicated that funds are available for the lots. He stated that staff is suggesting that over half of the money ($110,000) he taken from the Liquor Store reserves, $55,000 from the revolving loan fund, $20,000 from capital projects, and $25,000 from equipment reserves. He questioned whether these were appropriate sources to finance the purchase of the land. e Councilmember Dietz raised several issues regarding the City's proposed purchase of the Elk River Industrial Park. He questioned whether the the money would be recaptured if the Cl ty purchased the land. He stated that he appreciates all the Associated Investors have done for the City, but questioned what benefits the City would gain if it owned the lanel. He also questioned what would happen differently if the Ci ty owned the land instead of the Associated Investors. He stated that the Ci ty would probably continue to pursue buyers whether or not the Ci ty owned the property. He further stated he felt that the average tax payer would have a problem with the City using money for this purpose. Councilmember Dietz also questioned whether it would be fair to other' industr'ial property owners for the Ci ty to purchase one industrial park and not consider the purchasing of other industrial property. Special City Council Minutes October 17, 1991 Page 2 ---------------------------- e Discussion was held by the Council regarding the Elk River Associated Investors' investment in the Industrial Park. Councilmember Kropuenske indicated that the investors are borrowing money to pay taxes on the land. Bill Rubin, Economic Development Coordinator, indicated that if it is the Council's decision to purchase the property, top priority should be gi ven to recapturing the City money invested in the Industrial Park property. Mayor Tralle indicated that the City has made a commitment to keep Elk Ri vel' from becoming a bedroom communi ty. He indicated that the Ci ty Council must be cognizant of the tax base and that the labor market needs to be developed in Elk River. He stated that it may he a risk purchasing the Industrial Park, but felt the City could be set behind if the property is not purchased. He further indicated that if the City is going to be competitive in the economic development field, purchasing the property should be pursued. e Jerry McChesney questioned whether the City would be willing to buy his industrial property. He stated that he originally purchased the plat from the Elk River Associated Investors. Jerry McChesney indicated that if the City Council is considering purchasing the industrial land from the Associated Investors, they should also consider purchasing industrial land from other property owners. Councilmemher Kropuenske indicated that there is a difference in that the Elk River Associated Investors is a nonprofit organization and the other industrial property owners is in the business of making a profit. Mr. McChesney indicated that he and other industrial land owners have been ignored by the City. He stated they were completely ignored in the Elk River brochure and that the Elk River Industrial Park was the only industrial site mentioned. Mayor Tralle apologized to Jerry McChesney for neglecting to mention his Industrial Park and other industrial land in the City's brochure. He directed staff to look at the cost 'of reprinting the insert regarding the Industrial Park. Councilmember Holmgren stated that the advantages of purchasing the Elk River Industrial Park outweigh the disadvantages. He indicated that land values are continuing to rise in the City of Elk River and feels that the City would not lose money by purchasing the property. Councilmember Schuldt stated that he would not like to see the City use the revolving loan fund monies to purchase the Elk River Industrial Park. He stated that if the City decides to give the land away, the money used from the revolving loan fund would not be recaptured. He stated that the purpose of this fund is to help others. e COUNCILMEMBER HOLMGREN MOVED TO PURCHASE THE ELK RIVER INDUSTRIAL PARK FROM THE INDUSTRIAL PARK ASSOCIATED INVESTORS FOR $210,000 AND DIRECTED STAFF TO PROVIDE POSSIBLE FUNDING OPTIONS, FOR THE PURCHASE OF THE Special City Council Minutes October 17, 1991 Page 3 e INDUSTRIAL PARK, TO THE COUNCIL IN TWO WEEKS. COUNCILMEMBER KROPUENSKE SECONDED THE MOTION. Councilmember Schuldt indicated he felt the decision to purchase the property should be delayed until a decision is made on funding the purchase. THE MOTION CARRIED 3-2. Councilmembers Schuldt and Dietz opposed. The City Council recessed at 7:20 to hold the Economic Development Authority meeting. The City Council reconvened at 8:45. Lori Johnson, Finance Director, indicated that an Elk River property owner became aware of deferred green acres assessments on his property. She indicated that the assessments were deferred by the County about ten years ago and the property owners did not request that the assessment be deferred and were not aware that the assessment had been deferred. She further indicated that the original assessment amount was approximately $7,400, but with the 12.23% interest accumulating over the ten years, the amount owing on the assessments has risen to about $24,000. Lori .Johnson suggested that simple interest be charged on this assessment since the owners did not request that it be deferred. Using a simple interest calculation, the amount due is approximately $16,300.00. e Lori Johnson indicated that after talking with the County this situation should not happen in the future. The City's present policy is to have a special application filled out by the property owner to defer any special assessments, thereby making the property owner aware of the terms of the deferral. Lori Johnson also informed the Council that she has been advised by the City Attorney that it is acceptable for the City to defer an assessment and require annual payments of interest. She stated that an amendment wEI be made to the City's assessment manual adding this language. COUNCILMEMBER HOLMGREN MOVED TO CHARGE SIMPLE INTEREST ON THE SPECHT SEWER INTERCEPTOR ASSESSMENT BECAUSE THE ASSESSMENT WAS DEFERRED WITHOUT THE OWNER'S KNOWLEDGE OR APPROVAL. COUNCILMEMBER KROPUENSKE SECONDED THE MOTION. THE MOTION CARRIED 5-0. Pat Klaers, City Administrator, indicated that Phil Hals, Street/Park Superintendent, is requesting authorization from the Council to pur'chase a used trail groomer for the cross-country ski trails. He stated that funding would be provided through donations from the Ski Club, and from park equipment reserves. e COUNCILMEMBER KROPUENSKE MOVED TO APPROVE THE PURCHASE OF THE SKI GROOMER FROM ROAD MACHINERY AND SUPPLIES COMPANY OUT OF DULUTH AT A PURCHASE PRICE OF APPROXHlATELY $12,500 WITH THE MONEY TO COME FROM PARK EQUIPMENT RESERVES AND THROUGH DONATIONS FROM THE SI\I ORGANIZATION. COUNCILMEMBER HOLMGREN SECONDED THE MOTION. THE MOTION CARRIED 5-0. Special City Council Minutes October 17, 1991 Page 4 It Pat Klaers, City Administrator, indicated that staff is requesting authorization from the Council to approve the water portion of the bid from SJ Lewis Construction, Incorporated, for the County State Aid Highway #l elementary school street and utility improvement project. He indicated that this assessment would not affect any property owner other than the school and further stated that the School District has signed a waiver of appeal regarding this portion of the project. COUNCILMEMBER KROPUENSKE MOVED TO ADOPT RESOLUTION 91-58, A RESOLUTION ACCEPTING BID AND AUTHORIZING EXECUTION OF CONTRACT IN THE MATTER OF THE CSAH #1 ELEMENTARY SCHOOL STREET AND UTILITY IMPROVEMENT OF 1991. COUNCILMEMBER DIETZ SECONDED THE MOTION. THE MOTION CARRIED 5-0. 4. Review Redistrictin~ Plans The City Clerk reviewed four possible redistricting plans with the City Council. She indicated that these are just four possibilities and that the lines can change from any of these four plans. e Discussion was held by the Council regarding the decision of whether to cut the City so that the northern part of the City is in one ward. It was the consensus of the Council that the northern portion of the City be kept in one ward because it is the only land designed for one home per ten acres. Discussion was held regarding the downtown area not being split by wards. It was the consensus of the Council that the downtown area need not be split by wards. Discussion was held regarding giving consideration to splitting neighborhoods. The City Clerk stated that this is not always possible because census block lines should be followed. The City Clerk informed the Council that many factors are taken into consideration when drawing ward lines but that the main factors to be considered are that the 1 ines mllst follow physical features such as streets, rivers, streams, etc. and that future growth in each ward should be considered. It was the consensus of the Council to authorize the City Clerk to draw two or three more ward maps taking into consideration the points mentioned by the Council. 5. Other Business There was no other business. 6. Adjournment There being no further business, COUNCILMEMBER DIETZ MOVED TO ADJOURN THE MEETING. COUNCILMEMBER HOLMGREN SECONDED THE MOTION. THE MOTION CARRIED 5-0. e The meeting of the Elk River City Council adjourned at 9:35 p.m. ~ Sandra Thackeray City Clerk