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09-09-1985 CC MIN REGULAR WEEKLY SCHEDULED MEETING OF THE ELK RIVER CITY COUNCIL HELD AT THE ELK RIVER CITY HALL MONDAY, SEPTEMBER 9,1985 MEMBERS PRESENT: Mayor Hinkle, Councilmembers Gunkel, Schuldt, Williams and Engstrom MEMBERS ABSENT: None STAFF PRESENT: Torn Bublitz, City Administrator: Steve Solomon, representing the City Attorney's Office. 2. Consideration of Agenda Items 3.5 - Barthel PUD, 40 - Gates Avenue, and 6.5 - Star Cities Conference, were added to the agenda. 3. Elk River Ice Arena Revenue Bond Mr. Steve Solomon of the City Attorney's Office, reviewed the various transactions required for the Council to authorize the issuance of a revenue bond for the remodeling of the Elk River Ice Arena. He noted that the State Statutes impose certain requirements on cities to provide financing for revenue bonds and include the following: 1. OWnership of the Ice Arena is transferred to the City of Elk River. 2. The City leases the arena to the Hockey Association. 3. Rental payments indebtedness on Association is pay the bonds. 4. When the debt is paid, the title is returned to the Association. must be sufficient to pay the the revenue bonds and the Hockey committed to paying sufficient rents to Mr. Solomon noted that the First National Bank of Elk River is the lead bank in the transaction, the other banks being the Bank of Rogers and the Bank of Elk River. Mr. Solomon then proceeded to review the Resolution authorizing the issuance of the revenue bonds and specifically reviewed the terms of the loan arrangement on page three of the resolution. He explained that the bond purchase agreement stipulates that the City agrees to sell the revenue note and the bank agrees to buy the note for $300,000. He emphasized ~ PAGE 2 CITY COUNCIL MINUTES SEPTEMBER 9, 1985 that the City of Elk River is not committed in any way to levy taxes to pay the obligation, however, the City commits that the revenues it receives under the lease arrangement will be applied to payoff the debt. He added that the Hockey Association must provide for the payment of debt service and operating expenses. Mayor HInkle inquired if there were any penalties for prepayment. Mr. Solomon replied that there are some modest disincentives to prepay, however, he indicated the bank has not indicated any problem with the prepayment provision. Councilmember Gunkel commented that it appears to be inefficient to have the City receive funds from the association and then transfer them to the bank. Mr. Solomon replied that a direct payment could be arranged and is allowed under the statute, but some accounting would have to be made as per the stipulation of the statute. The Council continued to discuss this item and there was a general consensus of agreement among Councilmembers that the payments should be made directly from the association to the bank. The Council then discussed the issue of who was to pay for the preparation of the legal documents required in connection with the revenue note. Mayor Hinkle stated that it was his oplnlon that the Council was to act as the go-between and not the financier in the transaction and the Hockey Association was to pay for all fees and preparation of all documents. After discussion consensus among Association to revenue bond. by the Council, there was a Councilmembers to require the pay all legal fees associated general Hockey with the Councilmember Williams inquir~d as to the rates charged by the hockey association for lce time. Mr. Dave Taus, representing the Hockey Association, stated that the hourly rates for ice time were $68.00 per hour for ice skating and $110 an hour for broomball. He added that there has been no problem with selling ice time in the arena. -.., PAGE 3 CITY COUNCIL MINUTES SEPTEMBER 9, 1985 COUNCILMEMBER ENGSTROM MOVED TO ADOPT RESOLUTION 85-38, A RESOLUTION OF THE CITY OF ELK RIVER AUTHORIZING THE ISSUANCE OF $388,888 PRINCIPAL AMOUNT, CITY OF ELK RIVER, MINNESOTA, RECREATIONAL FACILITY REVENUE NOTE (ELK RIVER ICE ARENA PROJECT), SERIES 1985, AND APPROVING THE FORM THEREOF AND AUTHORIZING THE EXECUTION OF NECESSARY DOCUMENTS RELATING THERETO. COUNCILMEMBER SCHULDT SECONDED THE MOTION. THE MOTION PASSED 4-8. 3.5 Barthel Planned Unit Development Mayor Hinkle commented that a certificate of occupancy had not been issued for the Ben Franklin store in the shopping center, but that the store did open. The City Administrator stated that the City's Building nd Zoning Administrator had met with Mr. Tom Decowski, representing Barthel on Friday at 4:39 p.m. He noted that Mr. Breezee had indicated that Mr. Decowski stated that the blacktopping was to be done over the weekend. He noted that Mr. Decowski informed Mr. Breezee that the lights were working, and that the landscaping around the shopping center was delayed to allow the construction of an irrigation system prior to the installation of the landscaping. Mr. Ken Barthel stated that the irrigation system was scheduled to be put in tOday, but the rain delayed it. He added that the plantings had been purchased, but had not been install~d due to the rain. He added that the berm had been started! and that the lighting was in. He also noted that the blac~topping was delayed because of the rain. , Councilmemberl Gunkel expressed a concern over dirt bike traffic alon~ the berm and the fact that they could be destroying th~ berm. She also noted that the curbing in the shopping are~ had been in for a long time and that she did not understanq why the blacktopping was delayed so long. In response to C4uncilmember Gunkel, Mr. Barthel stated that he did not wan~ the heavy equipment and trucks ruining the blacktopping !when the trucks were initially delivering materials toi the stores. He pointed out that the first blacktop con~ractor he hired did not fulfill his obligation and that he should have had the blacktopping in by today. PAGE 4 CITY COUNCIL MINUTES SEPTEMBER 9, 1985 Councilmernber Gunkel stated that she had talked to Mr. Rick Breezee regarding the fact that Ben Franklin had opened up. She pointed out that the Ben Franklin Store had been given all the informaion regarding the requirements for a certificate of occupancy and that it was left up to the owner to make the final decision as to whether or not to open the store. She added that she believes the Council needs to give the staff direction regarding the Ben Franklin Store and the fact that it did open without receiving a certificate of occupancy. Councilmember Williams stated he doesn't agree that all the items need to be completed in the landscaping prior to opening. Councilmember Gunkel stated that she believed the blacktopping and the berm on the west of the development including the minimal plantings on the berm should be completed prior to issuing any certificates of occupancy for the shopping center. Mayor Hinkle requested Mr. Barthel to contact Mr. Glover, the owner of the Ben Franklin store to obtain a certificate of occupancy and to direct him to contact Mr. Rick Breezee to obtain the certificate. Mr. Barthel stated he would contact Mr. Glover and also would complete the berm, ~ncluding the plantings. 4A. Consideration of Purchase of New Front End Loader Mr. Phil Hals, the City's Street Superintendent, requested direction from the Council regarding the purchase of a new front end loader. He explained that his thought was to set up a Rquick hitchR attachment on the City's existing loader but he found it may be advisable to buy a new loader rather than equip the existing loader with the Rquick hitchR attachment. He added that a third hydraulic valve would allow him to put on a reversible plow to the existing loader. He explained the cost of a Rquick hitchR attachment for the City's existing loader would be approximately $4,200. Mayor Hinkle expressed a concern that the budget may not work for purchase of a new loader. Mr. Hals explained that there is a guaranteed buy-back of $58,000 on the City's existing loader, which amounts to the original purchase price of the loader. He explained the new loader would cost approximately $65,000, which means that for approximately $7,000 the City could purchase a new loader. He added that the new machine would have the third valve which the current loader does not have. Mayor Hinkle stated that he would PAGE 5 CITY COUNCIL MINUTES SEPTEMBER 9, 1985 have no problem with Mr. Hals obtaining bids on the loader for the Council to review. 4B. Cargill Roads Mr. Hals explained that Mr. Ernie Goldman of Cargill Inc. has requested the City grade a road from171st street to 165th Street on the East side of the railroad tracks. He explained that this road is on Cargil property but is currently being used by the local school bus. Mayor Hinkle expressed a concern that the road is a private road and that he was concerned regarding setting a precedent for grading a private road with City equipment. Mr. Hals pointed out that it has been City policy in the past not to blade private roads. There was a general consensus of Councilmembers to continue the City's policy of not grading private roads. 4C. Peterson Addition - Drainage Problem Mr. Phil Hals pointed out that, at the corner of 196th and Ogden Avenue, there is a pond that was intended, by the developer, to handle all of the water run off in the Peterson Addition. He explained that with the high water table we are now experiencing the pond is overflowing with water standing on City streets. He explained that he had met with County Engineer, Russ Machinsky and County Commissioner Lyle Smith regarding the problem and that they gave their approval to hook up to the County tile system, however, he pointed out the County will not provide for the hook up. He added that City crews have not yet been able to find the tile line on one end, but they have found an opening on the downstream end. Mr. Hals explained that the cost estimates amounted to approximately $1,000 for digging and $700 for a five to six inch PVC pipe. Mayor Hinkle inquired as to how the City would recover the cost without an assessment hearing. After some discussion by the Council, there was a general consensus that the City would have to assume the cost of installation of the pipe. There was a consensus agreement of Councilmembers to proceed with the project. 4D. Gates Avenue Councilmember Gunkel expressed a concern over the truck traffic on Gates Avenue traveling to get accross the ~ PAGE 6 COUNCIL MINUTES SEPTEMBER 9, 1985 railroad tracks. She added that she is concerned that the weight of the trucks is too great for the road. Mr. Hals stated that Railroad Drive was upgraded for heavy trucks and that UPA may be able to do the same for this area. 5. Discussion Item: Citizen's Advisory Committee The Council discussed the composition of the Citizen's Advisory Committee for the public facilities referendum. Councilmember Gunkel suggested checking the attendance at the meetings of the previous Citizen's Advisory Committee to determine who the interested members were. Mayor Hinkle suggested contacting community groups such as local service organizations, the Chamber of Commerce, the Retail Merchants Association, the Ministerial Association and other groups. He added that in his opinion the committee ought to be composed of between 15 to 2B persons. The Council continued to discuss the membership of the Citizen's Advisory Committee. Councilmember Gunkel suggested contacting Pat Rasmussen, who is on the Governmental Affairs Committee, to see if she will serve as a liason to the Chamber of Commerce. The Council's discussion then focussed on the options for the type of facilities to be considered. Councilmember Williams stated that he had a discussion recently with Mr. Gary Santwire regarding the fact that Mr. Santwire indicated a City hall could be built for approximately $5BB,BBB. Councilmember Williams suggested inviting individuals who are knowledgeable in construction to a future committee meeting to discuss the public facilities options. The Council agreed to invite Mr. Gary Santwire and Mr. John Weicht to a committee session to be held on September 3B, 1985, to review City facilities options. 6. Cable Communicatons Commission Budget for 1986 The City Administrator reviewed the proposed Sherburne/Wright County Cable Communications Commission budget for 1986. He explained the Commission approved the budget at its meeting of June 5, 1985 and that the Joint Powers Agreement Provides for a review of the Commission budget by the member cities. He explained that the budget, as adopted by the Commission, will be considered approved by PAGE 7 CITY COUNCIL MINUTES SEPTEMBER 9, 1985 the City unless the City gives notice in writing to the Commission prior to October 15th that it is withdrawing from the Cable Commission. COUNCILMEMBER GUNKEL MOVED TO APPROVE SHERBURNE/WRIGHT COUNTY CABLE COMMUNICATONS BUDGET AS SUBMITTED. COUNCILMEMBER WILLIAMS MOTION. THE MOTION PASSED 4-9. THE 1986 COMMISSION SECONDED THE 6.5 Star Cities Conference The City Admiistrator stated that the Minnesota Department of Energy and Economic Development will be holding its annual Star Cities Conference in September and noted that it would be a three day conference, at a cost of $59 per participant. COUNCILMEMBER WILLIAMS MOVED TO AUTHORIZE THE CITY ADMINISTRATOR TO ATTEND THE ANNUAL STAR CITIES CONFERENCE. COUNCILMEMBER GUNKEL SECONDED THE MOTION. THE MOTION PASSED 4-9. 7A. Meeting With Mr. Gary Sauer of Barton Sand and Gravel, Inc. The City Administrator stated that he had been in contact with Mr. Sauer and that he would be unavailable to meet with the Council in October, but that sometime in November he would be available to discuss the activities of Barton Sand and Gravel with regard to mineral extraction operations in Elk River. The Council discussed the proposed meeting with Mr. Sauer and agreed that a meeting as early as possible in November would be preferred. 7B. Distilled Spirits Excise Tax The City Administrator reviewed a memorandum from the City's Liquor Store Manager regarding the new federal excise tax which will go into effect October 1, 1985. Essentially, he explained the tax will impose a floor tax on all liquor in the store with the exception of wine and beer. He pointed out that the Liquor Store Manager is proposing to buy, in advance of the tax, a supply of liquor for 69 to 99 days to increase the store's profits. He added that, the Liquor Store Manager is proposing to purchase fast selling items in order to take advantage of the pre-tax prices and the anticipated increased mark-ups by distillers and wholesalers. ~ PAGE 8 CITY COUNCIL MINUTES SEPTEMBER 9, 1985 7C Special City Council Executive Session to Discuss Labor Relations Matters The City Administrator stated that he would like to schedule a special executive session of the City Council to review the City's status with regard to labor negotiations for 1986. He explained that the special meeting would have to be tape recorded, and that the tape would have to be maintained for a period of two years, and that it would become available to the public after the contract negotiations had been completed. The Council discussed the special executive session and agreed that it would be scheduled at the discretion of the City Administrator. 7D. Appointment of Finance Officer The Council reviewed the applicants interviewed for the Finance Officer position and COUNCILMEMBER GUNKEL MOVED TO DIRECT THE CITY ADMINISTRATOR TO OFFER THE POSITION OF FINANCE OFFICER FOR THE CITY OF ELK RIVER TO LORI JOHNSON AND THAT HE BE INSTRUCTED TO MAKE AN OFFER OF $26,000 FOR SALARY. COUNCILMEMBERENGSTROM SECONDED THE MOTION. MAYOR HINKLE, COUNCILMEMBERS GUNKEL, ENGSTROM, AND WILLIAMS VOTED IN FAVOR OF THE MOTION.COUNCILMEMBER SCHULDT VOTED AGAINST THE MOTION. THE MOTION PASSED 4-1. 8. Check Register COUNCILMEMBER GUNKEL MOVED TO APPROVE THE CHECK REGISTER. COUNCILMEMBER WILLIAMS SECONDED THE MOTION. THE MOTION PASSED 4-0. 9. Adjournment There being no further business, COUNCILMEMBER ENGSTROM MOVED THAT THE MEETING BE ADJOURNED. COUNCILMEMBER GUNKEL SECONDED THE MOTION. THE MOTION PASSED 4-0. The Elk River City Council adjourned at 10:46 p.m. ~;?~ Tom Bublitz ..... City Administrator Recording Secretary