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4.2 DRAFT MINUTES 07-15-2024Meeting of the City Council Held at the Elk River City Hall Monday, July 1, 2024 Members Present:Mayor John Dietz, Councilmember Jennifer Wagner, Councilmember Mike Beyer, Councilmember Matt Westgaard, Councilmember Cory Grupa Members Absent:None Staff Present:City Administrator Cal Portner, Assistant City Administrator Joe Stremcha, Senior Planner Chris Leeseberg, City Clerk Tina Allard 1.CALL MEETING TO ORDER Pursuant to due call and notice thereof, the meeting was called to order at 6:45 p.m. 2.PLEDGE OF ALLEGIANCE The Pledge of Allegiance was recited. 3.CONSIDER AGENDA Mayor Dietz added Item 8.3 regarding an ordinance amendment for food trucks and 8.4 regarding the Independence Day fireworks. 4.CONSENT AGENDA Moved by Councilmember Beyer and seconded by Councilmember Wagner to approve the following consent items as outlined in their respective staff reports. Motion Carried 5- 0. 4.1 June 17, 2024, Regular Minutes 4.2 Check Register 4.3 2024 Equipment Replacement Fund Purchase 4.4 Temporary On-Sale Liquor License: Saint Andrew Catholic Church 4.5 2024-2025 Liquor License Renewals Page 5 of 389 City Council Minutes July 1, 2024 --------- Page 2 of 8 4.6 Designate Parcel 75-00132-2125 as Scout Island Park 4.7 Severence Agreement and Waiver of Claims 4.8 Amend Resolution 23-62, 2024 Compensation Plan for Non-Organized Employees 4.9 Temporary On-Sale Liquor License: Davis-Darrow-Meyer American Legion Post 112 4.10 Ordinance 24-16: Amending Chapter 2-253, Authority and Duties of the Multipurpose Facility Commission (Continued to July 15 Council Meeting) 5.OPEN FORUM No one appeared for Open Forum. 6.PRESENTATIONS, AWARDS, AND RECOGNITION There were no presentations. 7.PUBLIC HEARINGS 7.1 Plat: Briggs Estates, 10528 175th Ave NW - Pat Briggs Resolution 24-36 Mr. Leeseberg presented the staff report. Mayor Dietz opened the public hearing. Mike Johnson, 17516 Polk Street - asked what would be going on this parcel of land. Mr. Leeseberg stated the parcel is currently zoned to allow single-family homes, townhomes, or apartments. The mayor questioned the quantity of these items that would be allowed on this parcel. Mr. Leeseberg couldn't state for sure without having time to calculate, but he thought no more than four single-family homes could fit and maybe six townhomes. He stated an apartment complex could be difficult. He also noted a home on an adjacent lot could be torn down and added to this parcel of land, which could change the numbers. Mayor Dietz closed the public hearing. Moved by Councilmember Westgaard and seconded by Councilmember Wagner to adopt Resolution 24-36 with the following conditions: 1. Park dedication shall be paid for one dwelling unit at the rate applicable when the subdivision is released for recording (currently $3,065.73/lot). 2. The wetland boundaries shown on the plat shall be updated to reflect the approved wetland boundaries as determined by the Technical Evaluation Panel. Page 6 of 389 City Council Minutes July 1, 2024 --------- Page 3 of 8 3. A 45-foot drainage and utility easement shall be added around all wetlands, reflecting the required setbacks outlined in Sec. 30-1852. Motion Carried 5-0. 8.GENERAL BUSINESS 8.1 Parks & Recreation and Planning Commission Appointments Moved by Councilmember Westgaard and seconded by Councilmember Wagner to appoint Melissa Fermoyle to the Parks and Recreation Commission with a term ending February 28, 2025. Motion Carried 5-0. Moved by Councilmember Wagner and seconded by Councilmember Beyer to appoint Anthony Kaba and James Zahler to the Planning Commission. Councilmember Westgaard noted the terms needed to be set for each appointment. Councilmember Wagner amended her motion to appoint Mr. Kaba to the commission with a term ending February 28, 2027 and Mr. Zahler with a term ending February 28, 2026. The seconder of the motion was amenable to the change. Motion Carried 5-0. 8.2 Discuss Work Session Items Councilmember Wagner added a discussion regarding Council Chambers safety. 8.3 Ordinance Amendment 24-16: Food Trucks Ms. Allard presented the staff report. Mayor Dietz spoke with Recreation Coordinator Karen Wingard who suggested reaching out to one of the local businesses to see if they would be willing to host food trucks in their parking lot during concert events. Councilmember Wagner stated she has already spoken with the church and they are open to having trucks in their lot. She spoke with the Downtown Elk River Business Association (DERBA) and the local restaurants. She stated the DERBA group felt food trucks are a draw and the groups main concerns were not wanting parking stalls taken up on Main Street or having trucks with similar businesses to their own. She told the group we couldn't regulate which type of trucks could be downtown. Councilmember Wagner questioned Section 8 of the ordinance which allows food trucks to take up to three parking stalls, which she is not in favor of allowing. Mayor Dietz concurred on not allowing up to three spaces in the downtown. Ms. Allard noted the parking stall regulation applied to the whole city and asked for clarification on if the Page 7 of 389 City Council Minutes July 1, 2024 --------- Page 4 of 8 intent is just related to downtown or the whole city. Mr. Stremcha noted in parks it would be three stalls instead of two. The Council concurred they'd like food trucks in the downtown district to only be able to take up two parking stalls. Councilmember Wagner stated it would be detrimental to downtown businesses to allow food trucks on Main Street. Mayor Dietz noted safety issues as well. Councilmember Westgaard further noted the parking stalls would include the private lots as well. Ms. Allard noted, as the ordinance is currently drafted, food trucks can only park on King Avenue and on private property and language could be added to the ordinance allowing them in other areas of downtown during city events. The Council concurred on allowing trucks in other parts of downtown for city events. The Council also wanted language stating no food trucks are allowed on Main Street and Jackson Avenue unless it is closed down for a city event. The Council asked staff to arrange for a couple of food trucks for the next concert night. The Council summarized the ordinance amendment as follows: a. No food trucks are allowed on Main Street or Jackson Avenue in the downtown district. (except when the street is closed for city events). b. Food trucks can only be parked on King Avenue. c. Food trucks can be on private property. Moved by Councilmember Wagner and seconded by Councilmember Grupa to adopt Ordinance 24-16. Motion Carried 5-0. 8.4 Discuss Independence Day Fireworks Mayor Dietz noted there is a likelihood of rain on Independence Day, and he questioned the process for determining whether the fireworks should be canceled and community notification. Mr. Stremcha explained delivery is expected on Thursday, July 4 at 1:00 p.m. If we cancel the delivery on Wednesday, the extra costs for rescheduling the event would be minimal. If the delivery is accepted and the fireworks are canceled on July 4 due to the weather, the backup date would be Friday, July 5, and this date also looks likely to have rain. He stated if the delivery is accepted there will be extra costs for a 24-hour watch by the police department to ensure no tampering or theft, which would be very expensive. If both dates are canceled, the police watch will be required until the vendor can pick up the fireworks on Saturday. He stated another option, based on the weather, is to cancel the order and have the fireworks delivered at another date, which would be a minimal extra expense. Councilmember Beyer asked about the additional costs if delivery is accepted and a police watch is required. Mr. Stremcha stated it could be an additional $10,000-12,000. Page 8 of 389 City Council Minutes July 1, 2024 --------- Page 5 of 8 Mayor Dietz suggested the Elk RiverFest event be the backup date if the fireworks need to be canceled. 9.COUNCIL LIAISON UPDATES 9.1 Council Liaison Updates The Council provided updates as outlined in the respective advisory board's minutes. 10.MOTION TO ADJOURN REGULAR MEETING Moved by Councilmember Beyer and seconded by Councilmember Wagner to adjourn the meeting of City Council. Motion Carried 5-0. The regular meeting adjourned at 7:22 p.m. 11.WORK SESSION – UPPER TOWN CONFERENCE ROOM The work session meeting convened at 7:27 p.m. 11.1 FT Center Ice, Turf, and Room Rates Ice Rates Mr. Stremcha presented the report. Councilmember Beyer brought up the following items: 1. Are the comparable communities all city-owned properties? Mr. Stremcha stated yes. 2. Expressed concerns about the additional $10,000 increase in fees for the figure skating club. Councilmember Westgaard explained that the club received a reduced rate after the pandemic to help them get their membership levels back to pre-pandemic levels. 3. Are the roles and duties of the multipurpose facility going to be discussed? Mr. Portner noted the discussion was scheduled for the next City Council meeting. 4. Expressed concerns about not having the history of how the current rates were determined, which makes it difficult to decide on rates. 5. Elk River Youth Hockey buys much more ice, and they pay more than the other users. Councilmember Wagner stated this is why the rate discussion is being brought to the Council level, noting it is good to have fresh eyes because the facility needs to break even. She provided a history of the differing contract negotiations which has led to user groups feeling slighted. She felt it was good to look at this without background information to call out concerns, be neutral, and question the processes. Councilmember Beyer stated he is not ready to make any decisions tonight because he needs more time to evaluate the rates and get input from the Multipurpose Facility Commission. Mayor Dietz stated the Council took away the Commission's authority to provide input on the rates based on the city attorney's opinion. Councilmember Westgaard noted discussion is needed about the role of the Page 9 of 389 City Council Minutes July 1, 2024 --------- Page 6 of 8 commission when the city attorney is available. Mr. Portner informed the Council that the high school sets their levy in August and youth hockey sets their budget in September, so both groups will need to know the rates soon. Councilmember Westgaard asked why the rates need to be so complex. He asked that the amount of revenue needed be divided by the ice hours purchased to set the rate for prime, non-prime, and school. Councilmember Westgaard noted that the ice rates generate roughly 50% of the total revenue for the facility. We are talking about $800,000 in ice rental revenue and hoping to generate $1.8 million worth of total revenue. He said we could talk about ice rates, and who's going to generate what and asked if we are we barking up the wrong tree? He stated the facility isn't going to float by charging more for ice rates. He feels there are some bigger holes to address and recalled an initial projection presented in 2020 by staff with revenues from turf and meeting room rentals near $700,000, and we are barely clearing $150,000. He'd like to get rid of negotiated contracts and go back to a prime, non-prime, and school rate for every user group, noting this rate structure worked well in the past. He asked for the comparable (comps) rates for Anoka, Rogers, Monticello, and Princeton because local users would go to these facilities if they didn't like the rate we set. Councilmember Westgaard questioned the maximum capacity for ice rental revenue and whether it is achievable. Mr. Stremcha stated there is room to grow because we expended the length of service with the second sheet of ice. The ice rink will remain for a longer period to attract summer tournaments and expand the summer camp opportunities. Councilmember Westgaard stated the facility can't be made to float on ice user groups alone and other areas of the facility need to be reviewed for revenue sources, such as the turf and meeting rooms. He asked if the staffing levels are needed when the other spaces are currently not at capacity, noting the city previously ran a two-sheet ice facility with only two employees. He stated the revenue is needed to support the staff level, and we haven't proven support with the previous three-year revenue projections. He does not want to see the same projections because it hasn't been proven things will be different. Mr. Stremcha stated we are implementing an organizational restructure as approved by council this summer. This reorganization reduces staffing and reallocates resources for a focus on hospitality expertise through event planning and expanded concessions operations for additional revenue opportunities. Councilmember Westgaard stated the ice rate for prime time should be no less than $250, noting youth hockey has had the benefit of a low rate for a long time due to things like the poor condition of the previous facility. Mayor Dietz stated he is okay with the rates in Scenario A of the presentation. There was discussion on who is in the pool of comps, how big, how small, what the pool consists of, and which categories it applies to. Mr. Stremcha suggested the three rates; prime, non-prime, and school hours, but the school hours rate should factor in comparable arenas hosting USPHL teams to maintain a competitive advantage, as the comparison list for prime, non-prime, and school ice rates did not have bulk daytime user groups to complement those less desirable ice times which are more challenging to fill. This would result in a blended school rate averaging the School rate and USPHL rate. Councilmember Westgaard suggested establishing a list of comps (historically a list of 12) different from what is in the presentation, considering locality but also facility amenities. Mr. Stremcha then questioned if the rate is truly based on an average or, like the union negotiation of wages, where you want to be in Page 10 of 389 City Council Minutes July 1, 2024 --------- Page 7 of 8 that top quartile. Councilmember Westgaard stated the facility is premier and not average, which would affect the rate. He suggested reviewing the 12 comps yearly to determine where to set our rates, noting it does not have to be a mathematical average of the 12. Mayor Dietz stated the local comps will bring averages down unless we specifically provide statistical information to support it. Mr. Stremcha sought to clarify the inclusion of the local comps if the statistical information is not of value. Councilmember Westgaard stated the rates would be used to establish our rate, not for setting averages, and they would be a market comparison for different reasons. Mr. Portner asked if there would be any consideration that some of the other comps are subsidized by their city general fund. Councilmember Westgaard stated yes, noting other factors need to be considered as well, such as user groups in other communities who give annual contributions from pull tab proceeds. There was a Council consensus on setting three rates for prime, non-prime, and school. The Council stopped short of providing direction on the amount because they would like to discuss the role of the Multipurpose Facility Advisory Commission. Mr. Stremcha suggested at minimum setting a framework to guide the Commission. Councilmember Wagner suggested a joint work session meeting for July 15, so everyone understands the role of the Commission. Turf Rates Mr. Stremcha reviewed turf rates in his presentation. He noted there were about 24 different rates based on the user groups. Councilmember Westgaard stated he was surprised by the high rate for prime hours in other communities. It was noted this would be a substantial increase and a hard sell to users. Councilmember Beyer noted there are some less positive things about our facility versus the other facilities, such as the low roof. The Council would like time to digest the information. Room Rates Mr. Stremcha reviewed room rates. The Council noted the current rate is lower than the comps, but it would be difficult to raise them when capacity is not being met. Mr. Stremcha suggested reviewing affordable add-on amenities with higher revenue potential to market the rooms more effectively. Councilmember Wagner suggested keeping the rates the same until there is more demand for room rental. She stated the rooms are a loss-leader to get people into the facility and hopefully gain other potential revenue with the add-on amenities. Page 11 of 389 City Council Minutes July 1, 2024 --------- Page 8 of 8 Councilmember Westgaard asked if the comps should include the private sector. Councilmember Wagner agreed, noting there should be local comps. Councilmember Grupa suggested trying to draw a different demographic by decorating the rooms to make them more inviting. The Council consensus was to keep one rate for all groups (resident/non-resident) which should be set at the current resident rate. Councilmember Wagner asked for more information on the maximum revenue that could be collected if all the rooms were rented out. Councilmember Westgaard asked if we were making a profit and how much, calculating the costs of having four extra full-time staff and considering all the other costs. Mr. Stremcha stated that based on our current concessions operations we are, but he noted there is room for expanding the service capacity with our current tools for more revenue. Councilmember Wagner would like a more detailed breakdown of line items in the budget by categories. 12.MOTION TO ADJOURN Moved by Councilmember Westgaard and seconded by Councilmember Grupa to adjourn the meeting of City Council. Motion 5-0. The meeting adjourned at 8:58 PM Minutes prepared by Tina Allard. ___________________ John J. Dietz, Mayor ___________________ Tina Allard, City Clerk Page 12 of 389