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4.1. DRAFT MINUTES (2 SETS) 09-03-2019 Meeting of the Elk River City Council Held at the Elk River City Hall Monday, August 5, 2019 Members Present: Mayor John Dietz, Councilmembers Garrett Christianson, Nate Ovall, Matt Westgaard, and Jennifer Wagner Members Absent: None Staff Present: City Administrator Calvin Portner, Police Chief Ron Nierenhausen, Fire Chief Mark Dickinson, Senior Planner Chris Leeseberg, Finance Director Lori Ziemer, Deputy Fire Chief Aaron Surratt, Public Works Director Justin Femrite, Parks and Recreation Director Michael Hecker, and Deputy Clerk Jessica Miller 1. Call Meeting to Order Pursuant to due call and notice thereof, the meeting of the Elk River City Council was called to order at 6:37 p.m. by Mayor Dietz. 2. Pledge of Allegiance Pledge of Allegiance was recited. 3. Consider Agenda Moved by Councilmember Wagner and seconded by Councilmember Ovall to approve the agenda. Motion carried 5-0. 4. Consent Agenda Moved by Councilmember Westgaard and seconded by Councilmember Wagner to approve: 4.1 Minutes:  July 1, 2019, Regular  July 10, 2019, Special (Groundbreaking)  July 15, 2019, Regular  July 22, 2019, Special (Budget) 4.2 Check register, check numbers 9988-9990 and 11190-111403 as outlined in the staff report. 4.3 Continue the temporary recreation program lead position at the Activity Center as outlined in the staff report. 4.4 Law Enforcement Services Agreement No. 19-17 between the City of Elk River and ISD 728. 4.5 Ordinance 19-14 repealing and replacing Chapter 2, Article IV, Finance, Division 1, relating to enactment of local sales and use tax. City Council Minutes Page 2 August 5, 2019 ----------------------------- 4.6 Hire James Kuklock as liquor store manager effective August 21, 2019, with pay and benefits as outlined in the staff report. 4.7 Interim pay to Lori Stich for acting as interim assistant finance director effective July 24, 2019. 4.8 First amendment to the settle agreement No. 19-14 with John and Elaine Dryer. 4.9 Professional services in the amount of $246,800 from Hakanson Anderson associated with engineering services for the Twin Lakes Road and Yale Street extension project. Motion carried 5-0. 5. Open Forum No one appeared for Open Forum. 6.1 CenterPoint Energy Community Partnership Grant Jake Schwietering, New Market Development Sales Consultant for CenterPoint Energy, presented a grant in the amount of $2,500 to the Elk River Fire Department. Moved by Councilmember Christianson and seconded by Councilmember Westgaard to adopt Resolution 19-32 acknowledging the $2,500 contribution from CenterPoint Energy to the Elk River Fire Department. Motion carried 5- 0. 7.1 Simple Plat: Bloomdahl Addition Mr. Leeseberg presented the staff report. Mayor Dietz opened the public hearing. There being no one to speak to this issue, Mayor Dietz closed the public hearing. Moved by Councilmember Westgaard and seconded by Councilmember Ovall to adopt Resolution 19-33 approving the plat of Bloomdahl Addition, with the following conditions: 1. Wetland delineation must be approved by city staff, and the plat must be updated to reflect the approved delineation prior to recording. 2. Add 45-foot easements around delineated wetlands. 3. Any item or condition found indicating the site is likely to yield information important to pre-history or history shall immediately be reported to the city. Further, the city reserves the right to stop work authorized in its approval until the site is appropriately investigated and work is authorized. Motion carried 5-0. City Council Minutes Page 3 August 5, 2019 ----------------------------- 7.2 Issuance of Sales Tax Revenue Bonds Ms. Ziemer presented the staff report and asked for the public hearing to be opened and closed. She indicated the city is no longer pursuing the 501(c)3 designation for the bonds. Mayor Dietz opened the public hearing. There being no one to speak to this issue, Mayor Dietz closed the public hearing. 8.1 Discuss Work Session Items Mr. Portner presented the staff report. Councilmember Christianson would like to add discussion regarding the purpose of the arena commission, heritage preservation commission, and library board. 9. Council Liaison Updates Councilmembers gave updates on the work of various boards/commissions as outlined in the specific board/commission minutes. Council recessed at 6:58 p.m. in order to go into work session. Council reconvened at 6:59 p.m. 10.1 T21 Discussion Sherburne County Public Health and Economic Supports Division Manager Amanda Larson and Sherburne County Attorney Kathleen Heaney provided a presentation on a proposed Sherburne County ordinance relating to changing the age to purchase tobacco to 21. The Council expressed concern with implementing T21 at the local level and would prefer it be a state initiative. They also believed educating students would be effective. Consensus was to not move forward with T21 at this time. Mayor Dietz disagreed believing something has to be done to help prevent the underage smoking epidemic. 10.4 Sunset Ridge Development Street Extension Mr. Femrite presented the staff report. Mayor Dietz asked Mr. Femrite for his opinion of opening the connection. Mr. Femrite indicated he would stick with the staff recommendation when Miske th Meadows 4 Addition was approved to allow the connection of Lincoln Street. Mayor Dietz indicated the Council received an email questioning if tree trimming could be done to improve site lines. Mr. Femrite explained Twin Lakes Road is City Council Minutes Page 4 August 5, 2019 ----------------------------- Sherburne County’s responsibility and in previous review the county did not have sufficient right-of-way to conduct tree trimming in some areas. He noted he can discuss with the county again. Councilmember Wagner would be interested in working with Mr. Femrite and the county to get brush cleared from the site lines. Councilmember Ovall questioned if smart signs would help in the area. Mr. Femrite stated he will apply the conditions against the Enhanced Traffic Control Policy to see if the area qualifies. The Council discussed whether or not the connection to the Sunset Ridge Development should be opened at this time in order to ease construction traffic. Consensus was to leave the connection barricaded closed for now until safety recommendations from the Twin Lakes Corridor Study have been completed. 10.2 Elk RiverFest Update Mr. Hecker presented the staff report. He indicated staff is recommending keeping the event on the first Saturday in July for consistency. Councilmember Christianson questioned if the Elk River High School is the only location to shoot fireworks. He questioned if it is feasible to shoot them over the river downtown. Mr. Hecker indicated fireworks can legally be discharged from Bailey Point but there are public safety concerns. Mayor Dietz believes the High School is a good location as it has lots of parking and traffic disperses pretty easy compared to when the fireworks were held near Orono. Councilmember Wagner added she wouldn’t be opposed to having the fireworks downtown but understands the public safety concerns. Council consensus was to hold next year’s Elk RiverFest on July 4, 2020. 10.3 Council Chamber Security Mr. Portner presented the staff report. Chief Nierenhausen indicated he would like to hear what the Council has in mind for security. He expressed concerns with the Council Chambers and City Hall security. The Council discussed security concerns and options. Council consensus was for Chief Nierenhausen to put together a cost estimate to have an officer present at Council meetings. 10.5 2020 Budget Ms. Ziemer presented the staff report. City Council Minutes Page 5 August 5, 2019 ----------------------------- Councilmember Christianson questioned if we can hold off on the $190,000 capital improvement for information technology. Mr. Portner indicated his recommendation is to hold off until the new IT manager is on board to review the system and make recommendations. Councilmember Wagner indicated she would like to see a breakdown of what the tax increase means to the average homeowner. Council consensus was to eliminate the three Fire Department position requests in the budget. Council felt this is a good time for the new fire chief to evaluate the department’s needs. Mayor Dietz noted he asked for a complete analysis on the duties of the fire marshal and inspector. Councilmember Wagner explained the Council struggles with the balance between maintaining service levels versus maintaining the tax rate. She stated it comes down to what it will cost the average taxpayer. Councilmember Wagner explained it is easy for the Council to set goals but it would be helpful to know the cost of implementing the goals when setting the goals. She requested Mr. Portner ask the Council next year if they want to maintain service levels or maintain the tax rate during the goal discussion. Councilmember Christianson concurred. Mayor Dietz suggested reducing the sinking fund by $150,000, postponing the hiring of the IT manager until 2021, and postponing the start date of the new investigative assistant until July of 2020. He also suggested transferring $50,000 out of the capital reserve to the General Fund for a total reduction of almost $300,000. Ms. Ziemer indicated liquor transfers to the General Fund could be increased but that would reduce transfers to the Park Improvement Fund. Mayor Dietz would like to see an analysis on these amounts. Councilmember Westgaard indicated he would prefer to look to culture and recreation budgets, including park maintenance, recreation, and senior programing before looking to cut officers. He indicated he would rather look at cutting non- essential services first. He noted the culture and recreation budget increased $120,000 compared to last year. Chief Nierenhausen clarified the investigative assistant position is not a licensed officer and he is comfortable with delaying hiring for six months if that helps the budget. Councilmember Ovall questioned how long the step increases from the recent Compensation Plan adjustments will impact the budget. Mr. Portner indicated the impact may be the highest this year and it should level off. He stated he will get information from finance to the Council this week. City Council Minutes Page 6 August 5, 2019 ----------------------------- Councilmember Christianson questioned if conferences and schools can be reduced. Staff indicated some staff is required to attend conferences and schools in order to maintain certifications. Councilmember Wagner asked Mr. Portner to go back to staff and request additional reductions. Mr. Portner indicated this has already been done. Councilmember Westgaard asked Mr. Portner is he preferred the Council reduce the budget as they see fit. Mr. Portner stated staff worked hard to reduce the budget and he would defer any additional reductions to the Council. Mayor Dietz asked if Monday, September 23 would work for the employee picnic. Councilmembers indicated they would check their schedules and asked Mr. Portner to discuss with employees to see if that date works. 11. Adjournment There being no further business, Mayor Dietz adjourned the meeting of the Elk River City Council at 10:10 p.m. Minutes prepared by Jessica Miller. ___________________ John J. Dietz, Mayor ___________________ Tina Allard, City Clerk Meeting of the Elk River City Council Held at the Elk River City Hall Monday, August 19, 2019 Members Present: Acting Mayor Matt Westgaard, Councilmembers Garrett Christianson, Nate Ovall, and Jennifer Wagner Members Absent: Mayor John Dietz Staff Present: City Administrator Calvin Portner, Planning Manager Zack Carlton, Senior Planner Chris Leeseberg, Finance Director Lori Ziemer, and City Clerk Tina Allard 1. Call Meeting to Order Pursuant to due call and notice thereof, the meeting of the Elk River City Council was called to order at 6:01 p.m. by Acting Mayor Westgaard. 2. Pledge of Allegiance Pledge of Allegiance was recited. 3. Consider Agenda Moved by Councilmember Christianson and seconded by Councilmember Wagner to approve the agenda. Motion carried 4-0. 4. Consent Agenda Moved by Councilmember Ovall and seconded by Councilmember Wagner to approve: 4.1 July 29, 2019, Special Minutes. 4.2 Check register, check numbers 111404-111614 as outlined in the staff report. 4.3 Temporary On-Sale Liquor License to Aegir Brewing Co. LLC at 19050 Industrial Blvd, NW, for September 21, 2109, with the condition alcohol must be confined to an area enclosed by fence with a secured, controlled access. Wrist band control is required for patrons 21 and over. 4.4 Resolution 19-34 approving a lawful gambling premises permit for Zimmerman Fire Relief. 4.5 Resolution 19-35 to support of a job creation fund application in connection with Hemmer Companies, LLC. 4.6 Pay Estimates as outlined in the staff report. City Council Minutes Page 2 August 19, 2019 ----------------------------- 4.7 Resolution 19-36 approving right of way acquisition of permanent easement for Lions Park Drive reconstruction and accept Change Order No. 1 for the 2019 Street Improvement Project. 4.8 Agreement 19-18 State of Minnesota general obligation bond grant contract with the City of Elk River for reclamation and enhancement of Lake Orono. 4.9 Resolution 19-37 granting plat approval for Island View Seventh Addition, Case N. P 19-11. Motion carried 4-0. 5. Open Forum No one appeared for Open Forum. 7.1 Conditional Use Permit: Cornerstone Auto Mr. Leeseberg presented the staff report. Acting Mayor Westgaard opened the public hearing. There being no one to speak to this issue, Acting Mayor Westgaard closed the public hearing. Moved by Councilmember Wagner and seconded by Councilmember Christianson to approve an amendment to Conditional Use Permit, Case No. 16-04 allowing construction of an accessory structure with the condition that all building permits must be approved by city staff prior to beginning construction. Motion carried 4-0. 7.2 Interim Use Permit for Institutional Use (School) in River of Life Church Mr. Leeseberg presented the staff report. Acting Mayor Westgaard opened the public hearing. There being no one to speak to this issue, Acting Mayor Westgaard closed the public hearing. Council expressed a concern with a second interim use permit previously granted for the same use. Staff noted the interim use permits have a deadline date attached to them. Moved by Councilmember Christianson and seconded by Councilmember Ovall to approve Interim Use Permit, Case No. IU 19-02 with the following conditions: 1. The Interim Use Permit will expire August 19, 2024. City Council Minutes Page 3 August 19, 2019 ----------------------------- 2. No Montessori Charter School functions may occur in temporary structures. Motion carried 4-0. 7.3 Ordinance Amendment: Institutional Uses Mr. Leeseberg presented the staff report. Acting Mayor Westgaard opened the public hearing. There being no one to speak to this issue, Acting Mayor Westgaard closed the public hearing. Council noted this item has been discussed many time over the last 6-8 months and the ordinance is in line with previous discussions. Moved by Councilmember Wagner and seconded by Councilmember Ovall to adopt Ordinance 19-15 Amending Chapter 30 Sections, 30- 1, entitled " Definitions"; 30- 383, entitled " Exemptions"; 30-938, entitled " Architectural Standards", 30- 991, entitled " R- I districts"; 30-992, entitled " R- 2a district"; 30-993, entitled " R- 2b district"; 30-994, entitled " R- 3 townhome district"; 30- 995, entitled " R-4 district; 30- 1022, entitled " C- I central business district"; 30- 1023, entitled " C- 2 office district"; 30- 1024, entitled " C- 3 highway commercial district"; 30- 1026, entitled " DD downtown district"; 30- 1584, entitled " MU-ERP mixed use Elk River Plaza district"; 30- 1587, entitled " Focused area study (FAST)"; and Chapter 78 Section, 78- 501, entitled " Generally", of the City of Elk River, Minnesota, City Code. Motion carried 4-0. Moved by Councilmember Ovall and seconded by Councilmember Wagner to adopt Resolution 19-38 approving notice of summary publication of Ordinance No. 19-15 an ordinance Amending Chapter 30 Sections, 30- 1, entitled " Definitions"; 30- 383, entitled " Exemptions"; 30-938, entitled " Architectural Standards", 30- 991, entitled " R- I districts"; 30-992, entitled " R- 2a district"; 30-993, entitled " R- 2b district"; 30-994, entitled " R- 3 townhome district"; 30- 995, entitled " R-4 district; 30- 1022, entitled " C- I central business district"; 30- 1023, entitled " C- 2 office district"; 30- 1024, entitled " C- 3 highway commercial district"; 30- 1026, entitled " DD downtown district"; 30- 1584, entitled " MU-ERP mixed use Elk River Plaza district"; 30- 1587, entitled " Focused area study (FAST)"; and Chapter 78 Section, 78- 501, entitled " Generally", of the City of Elk River, Minnesota, City Code. Motion carried 4-0. 7.4 Ordinance Amendment: Non-Residential Signage in Residential Districts Mr. Carlton presented the staff report. City Council Minutes Page 4 August 19, 2019 ----------------------------- Acting Mayor Westgaard opened the public hearing. There being no one to speak to this issue, Acting Mayor Westgaard closed the public hearing. Moved by Councilmember Wagner and seconded by Councilmember Ovall to adopt Ordinance 19-16 amending Section 30-879, Residential Districts, of the City of Elk River, Minnesota, City Code. Motion carried 4-0. 7.5 Ordinance Amendment: Warehouse Uses in the Business Park Zoning District Mr. Carlton presented the staff report. Acting Mayor Westgaard opened the public hearing. There being no one to speak to this issue, Acting Mayor Westgaard closed the public hearing. Council consensus is for no change to the zoning ordinance in regards to warehousing in the Business Park District noting there is not a need for additional warehouse use across the city. 6.1 City of Elk River Volunteer of the Month Acting Mayor Westgaard presented the August Volunteer of the Month award to Nancy Arnold. He highlighted the following:  Independence Elementary in Big Lake after school reading program volunteer.  Regular volunteer at Zimmerman Elementary.  Volunteer for Big Lake food shelf.  Participant in foster grandparents program through Americorp.  Set up fall festival service program with Camp Courageous from Monticello Iowa. 8.1 Resolution Awarding Sale of $33,735,000 General Obligation Sales Tax Revenue Bonds, Series 2019A Ms. Ziemer presented the staff report. Terry Heaton, Baker Tilly, provided results of the city credit rating and bond sale. She noted the True Interest Cost would be 2.3954%, which would save the city a lot of money in interest costs. She stated the city would be issuing $32,715,000. She discussed the city’s credit rating of AA+ noting it is the second highest rating a city can obtain. There was discussion about what would happen if the city was short or had overages in sales taxes. City Council Minutes Page 5 August 19, 2019 ----------------------------- Ms. Heaton discussed the option to levy if sales fall short or to sweep excess into a reserve fund that can be a contingency, and be invested to offset the cost of the debt service. Moved by Councilmember Wagner and seconded by Councilmember Ovall to adopt Resolution 19-39 awarding the issuance and sale of $32,715,000 General Obligation Sales Tax Revenue Bonds, Series 2019A, fixing their form and specifications; directing their execution and delivery; and providing for their payment. Motion carried 4-0. 9.1 2020 Budget Ms. Ziemer presented the staff report. She noted the extra funds requested for Elk Riverfest, city hall security, and plant watering for downtown are not currently listed in the 2020 preliminary budget in her report. She further discussed Mayor Dietz’s proposed adjustments to the preliminary tax levy as outlined in the staff report. It was noted the mayor’s proposed adjustments are not included in the 2020 preliminary tax levy breakdown in the staff report. Council discussed the details of why it would cost $8,000 to water plants, such as daily watering, including weekends and overtime. Mr. Portner noted watering would be needed nearly 7 days a week for 24 weeks, about two hours a day, at $14 per hour. Councilmember Ovall suggested moving the $8,000 for watering plants to the Housing and Redevelopment Authority budget noting he’d like to continue to see a vibrant downtown. He further noted Elk River Municipal Utilities will be installing new light poles. Council discussed council chambers security. Councilmember Christianson felt security wasn’t needed full time and to continue with past practice of having police presence at certain meetings when there are concerns. Councilmember Ovall and Acting Mayor Westgaard concurred. Acting Mayor Westgaard would like a future discussion regarding security coverage for the long-term. Councilmember Wagner stated it is not always known at which meetings there should be a police presence and felt $6,000 was a minor price to pay for safety. Mr. Portner stated this expense would be police overtime. He noted the new generation is not interested in overtime due to wanting more work-life balance, which has been different than seen with past generations. He stated the officers also have overtime in other areas throughout the year. Mr. Portner asked Council to reconsider the phased retirement for the IT manager. He stated cutting the phased retirement from 18 to 6 months may not be an incentive for the employee and the city would lose the opportunity to transfer his knowledge base to a new manager. He stated the $64,000 is the difference of moving the existing IT manager to half-time with full benefits and bringing on a new manager to have them look at the direction of department. He noted the department is already short on capacity and having a new set of eyes on the transition of City Council Minutes Page 6 August 19, 2019 ----------------------------- equipment, policies, and processes can help better prepare the city for the future. He is concerned about the transition and strategic planning. He further noted there would likely be an additional IT staffing request in 2021. Acting Mayor Westgaard felt the phased retirement for the IT manager is not normal business practice for staff transition but noted in today’s age of cyber security, it’s important to keep systems updated and there is a level of importance the city has in the management transition. He questioned if there is any other way to get creative with the structure of the IT position. Councilmember Christianson noted he spent time with the IT manager and he can see the benefit to having a transition plan. He stated he would like to see what the transition plan would look like to make sure the city gets its return on investment. Councilmember Wagner stated the reason the city would do the retirement, as proposed, is because the IT manager needs full benefits. Mr. Portner stated Council policy allows for full benefits under a PERA phased retirement and and referred to a previous public works transition. He stated it has been done for the more unique positions in the city. Councilmember Wagner suggested changing it to a contract position versus an employee. Mr. Portner stated this option wouldn’t be allowed because of PERA (the employee pension program). He stated one reason an employee takes a phased retirement is because they need health insurance to bridge to Medicare. He stated if the city didn’t allow the phased retirement, the employee would stay the 18 months, and then provide their notice. The city would pay full benefits but not reap the benefit time needed for backfilling and transitioning. He suggested there could be some potential savings depending on when recruitment is started if the Council entered into the phased retirement plan. Councilmember Ovall stated he would be interested in whether other cities offer life insurance for certain key, critical staffing positions. Acting Mayor Westgaard stated he’d like to keep Elk RiverFest in the budget because it is an extremely well-received community event. He is okay with $162,000 for elections and Lake Orono dredging because they are one-time expenses. He stated he could accept the proposed adjustment for the investigative assistant position with postponement to July 2020 to help offset the Elk RiverFest costs. Acting Mayor Westgaard is opposed to removing the $150,000 sinking fund allocation because the city needs to increase the building reserve and capital outlay. He stated Council can’t keep getting queasy about a percent increase or tax rate change because there will come a day when there will be a reckoning much like Council had with its facilities. City Council Minutes Page 7 August 19, 2019 ----------------------------- Councilmember Wagner stated she is uncertain how she feels about keeping the sinking fund allocation. Acting Mayor Westgaard stated he’d like to evaluate the possibility of raising the Elk River Municipal Utilities contribution rate from 4 to 4.5 percent, which would net about $150,000. He stated it appears Elk River may be on the lower end of average compared to peer cities. He wanted to make it clear this wouldn’t mean creating a pass-through fee increase to rate payers. Councilmember Ovall noted Elk River Municipal Utilities has assisted in other ways, such as the water tower and light poles. Council consensus was for staff to approach Elk River Municipal Utilities about having a review of the rate contribution to the city. Council would like to continue to work on reducing the budget after setting the maximum tax levy. Mr. Portner stated none of the territory acquisition was added into the accounting for the four percent, which was done purposely to ensure Elk River Municipal Utilities had the funding to buy into Minnesota Municipal Power Association. 9.2 Ordinance Amendment: Gambling Ms. Allard presented the staff report. Acting Mayor Westgaard stated he is not interested in increasing the number of premise permits an organization can have expressing concerns with monopolization. He noted youth hockey has repeatedly requested to increase the number of permits allowed and he would like to leave room for other organizations to have an opportunity at getting permits. Councilmember Wagner agreed stating other organizations may be upset by this change. Councilmember Ovall stated he is curious if other organizations realize they can have more than one permit, and is surprised more of them don’t. Mayor Dietz’s comments were read into the record, noting he is against increasing the number of permits. The majority of Council was not interested in allowing an organization outside of Elk River’s trade area to have a permit. Mayor Dietz’s concurred in his submitted comments. Council was unsure of the pros and cons for allowing more than one organization at one location but noted it could solve the issue of one organization monopolizing the permits. Council consensus is to invite the stakeholders; gambling organizations and on-sale liquor license establishments to discuss the requested ordinance amendments. City Council Minutes Page 8 August 19, 2019 ----------------------------- 10. Adjournment There being no further business, Acting Mayor Westgaard adjourned the meeting of the Elk River City Council at 7:50 p.m. ___________________ John J. Dietz, Mayor ___________________ Tina Allard, City Clerk