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HomeMy WebLinkAbout09.17.12 Council Minutes 2ct, COUNCIL MINUTES REGULAR September 17, 2012 1. CALL TO ORDER The meeting was called to order by Mayor Larson at 7:00 p.m. 2. PLEDGE OFALLEGIANCE Mayor Larson led the audience and Council in the Pledge of Allegiance. 3. ROLL CALL Members Present: Larson, Bartholomay, Donnelly, Fogarty, May Members Absent: None Also Present: Joel Jamnik, City Attorney;David McKnight, City Administrator; Randy Distad, Parks and Recreation Director;Kevin Schorzman, City Engineer;Cynthia Muller, Executive Assistant Audience: Rob Junker, Cal Huntley, Chris Rosenthal, Brian McGregor, Darren Simon,Nick Gerold, Dawn Wright, Deanna Anderson, Jon &Donna Simon, Kirk Zeaman, Bob Fancher, David Harnettt,John Abraham,Tim Wood, Chad Fritz, David Langenberger,Corey Weaver,James Lugowski,Alex Lester, Robert Lester, Keith Budenski, Brent Grengs, Jeff Beaurais, Dave Rogers, Shannon Shirley, Tad Guile, Craig Ruesink, Brian Turbert,Terry& Steph Marschall, Brad&Stacey Farrell, Maggie&Darren Ruennich, Anita&Darren Simon, Cory&Angie Bell, Troy Grengs, Mike Wolters, TJ& Sheila Ash, Tom Flanagan, Christy Stieg, Tami Huntley, Janelle Wall,Lisa Neugent,Lorna&Larry Lewis, Warren Johnson, Bill Sundt,Amy Holmstrom, Mike Hausworth, Jude Martinsen, Mark Smithson, Melissa Siebenaler, Susan Dullerhide, Dave Bennett,Joy Simon, Brian Pals, Tim Knutson, Deb Westfield, Mali Harvey, Frank Rusnaelco, Dustin Hinrichs, Theresa Agerter, Mark Seifert, Jen Wood, Jen, Kiley, Tyler Snobeck, Mike&Tracy Casshno 4. APPROVE AGENDA City Administrator McKnight added item 7o) Salary Investigation Summary. The investigation found no evidence of illegal actions or policy violations by any former or current employees whose raises were investigated. MOTION by Fogarty, second by Bartholomay to approve the Agenda. APIF, MOTION CARRIED. 5. ANNOUNCEMENTS 6. CITIZEN COMMENTS 5 Council Minutes(Regular) September 17,2012 Page 2 7. CONSENT AGENDA MOTION by Fogarty, second by Bartholomay to approve the Consent Agenda as follows: a) Approved Council Minutes(9/4/12 Regular)(9/10/12 Workshop) b) Approved Appointment Recommendation Finance Director—Human Resources c) Approved Medical Loss Ratio (MLR) Rebate Distribution—Human Resources d) Acknowledged Resignation Fire Department—Human Resources e) Received City Administrator Evaluation Summary—City Attorney f) Approved Recycling Association of MN Annual Conference—Municipal Services g) Approved MN State Fire Chief's Conference—Fire Department h) Approved MN Water Resources Conference-Engineering i) Adopted RESOLUTION R34-12 Approving Tax Forfeiture Parkview Ponds Outlots-Engineering j) Approved Temporary On-Sale Liquor License VFW-Administration k) Approved Temporary On-Sale Liquor License Farmington Liquors- Administration 1) Adopted RESOLUTION R35-12 Approving Gambling Event Permit Farmington Firefighters Auxiliary Association-Administration m) Approved Game Ice Rental Agreement Farmington School District—Parks and Recreation n) Approved Bills o) Received Salary Investigation Summary APIF,MOTION CARRIED. 8. PUBLIC HEARINGS a) Adopt Resolution—Approving Modification to TIF Plan for HRA Redevelopment District No.2-Administration Ms. Shelly Eldridge, of Ehlers and Associates, presented the information. Changes include the specifics in the plan. The district was approved in 1991 and a lot has changed in requirements both administratively and in the tax increment law. The plan is amended to bring it into current law and state auditor requirements. This does not increase the size of the district, extend the duration of the district, add addition projects, or additional obligations. The current obligations outstanding in this district are the 2004B tax increment bonds which will be paid off in 2015 and a TIF note to City Center Development, LLC that will be paid off in 2016. This district would be decertified or closed down in 2016. The maximum duration by law is 2021. The change needs to be made to bring the budget into compliance. The original budget was an estimate. The budget was less than the obligation. We are now increasing and clarifying the budget so we can pay the existing obligations. MOTION by Fogarty, second by Bartholomay to close the public hearing. APIF,MOTION CARRIED. MOTION by Fogarty, second by Bartholomay to adopt RESOLUTION R36-12 adopting a modification to the redevelopment plan for the downtown redevelopment project and a modification to the tax increment financing plan for the HRA redevelopment district number two. APIF,MOTION CARRIED. 6 Council Minutes(Regular) September 17,2012 Page 3 9. AWARD OF CONTRACT 10. PETITIONS,REQUESTS AND COMMUNICATIONS 11. UNFINISHED BUSINESS a) Adopt Resolution—Approving 195th Street Assessments-Engineering These are the assessments for the 195th Street project and the Fairhill property. The entire assessment has been placed over the entire property for a total amount of$4.632 million. The interest rate will be 3.786%and the term of the assessment is 11 years. Councilmember Fogarty assumed we would receive a check from the developer for the full amount of the assessment. She asked how much we will lose in interest anticipated to pay off the bond. City Engineer Schorzman stated at the April 2, 2012, meeting the amount was$400,000. There are opportunities to use the prepayment to offset those. In talking with the developer,they will pay half the assessments and leave the assessments on the property they still own and pay that off over the 11 years. The interest will be received on that portion. Mayor Larson stated the developer will be using the escrow money to pay off the assessments for the north half. Councilmember May asked if that escrow money should only be used for the portion that is owed. Mayor Larson stated when the developer sold the north halt they put aside the assessment money into escrow. Staff stated the properties listed include both the Seed property and the Finnegan property(north half). Councilmember May stated the escrow money is only allowed to be used for the Finnegan property. Staff has not seen the agreement between the Seeds and the Finnegans. Mr. Seed had explained they were under obligation to pay any assessments on those parcels. They put aside in escrow a portion of the sale price to cover that until the assessments are paid. Staff assumed they cannot use the escrow money for the rest of the property. City Attorney Jamnik stated that is not part of tonight's decision;that is part of their real estate transaction. They are not obligated to pay anything under tonight's proposal. We are just assessing the property as we agreed to in the Development Agreement. City Engineer Schorzman has been told they will pay half the assessment. Councilmember May asked why the City would not be concerned about how the escrow funds are used. City Attorney Jamnik stated their security is the property and they are not obligated to pay with our transaction. Our agreement is to levy the assessment on the property. If they want to sell it, a buyer would probably say the seller needs to cover the assessments first. Councilmember May stated the escrow money would not be allowed to pay the other portion. City Attorney Jamnik stated if they used the escrow money to pay something they were not entitled to,there would be a private cause of action by the purchaser to say you misapplied the escrow amount. The title company would probably not release the escrow to pay anything than for the properties in the escrow agreement. We have not seen their private escrow agreement or real 7 Council Minutes(Regular) September 17,2012 Page 4 estate documents. So we are guessing and relaying what we have heard them say to us. Councilmember Donnelly stated this will occur tonight no matter what happens. They are two totally separate deals. The City is not involved in the escrow. The City is assessing the$4.6 million and expects to be paid. It is up to the developer how to pay it. MOTION by Fogarty, second by Donnelly to adopt RESOLUTION R37-12 adopting the assessment roll for the Fairhill development related to the 195th Street project. APIF,MOTION CARRIED. 12. NEW BUSINESS a) Ice for Tigers Presentation-Administration The Ice for Tigers group is comprised of Rob Junker,Mitch Snobeck, Cal Huntley and Brian McGregor. They are not associated with any group. They are focused on bringing another sheet of ice to Farmington. They are parents involved in numerous ice programs. They started in December with an inception phase to see if this can be done. After they knew it was possible to add on to the Schmitz-Maki Arena,they started the elaboration phase and gathered experts in building ice arenas. They have determined there is enough demand in Farmington for a second sheet of ice to be a success. Tonight is the execution phase where they are seeking approval. Mr. Junker presented the design to add an NHL size sheet of ice to the arena and make a number of structural changes to the arena. The ice resurfacer would be in the rear. There would be a shared lobby area, varsity locker rooms, and team rooms. The second floor of the current arena would be used for storage only. The second sheet would host 300 visitors which means we could have tournaments here. This would also bring business to Farmington. Currently they have raised$360,141. In order to continue they have to make sure they have adequate fmancial sources as well as sponsorship opportunities. They are using a standard pyramid for fmancial sourcing. A Joint Powers Agreement would be in place stating who has the operating authority with the rink. They are looking to bring all groups together to create a solid,top line revenue for the rink, by making sure we know exactly how many hours are being purchased and committed. This would bring a group responsibility for the bottom line of the rink. The groups would include the City, Learn-to-Skate,Parks and Recreation, Schools, Farmington Youth Hockey Association, Heritage Skating Association, Ice for Tigers and the Farmington Business Association. They will be asking for specific alignment on the upfront capital, a commitment for payback as well as a period for that payback, and the structure of the build to make sure it accommodates all groups. Ice for Tigers was asking for Council approval on the following: 8 Council Minutes(Regular) September 17,2012 Page 5 1. Approve the ability for a new rink to be added to the Schmitz-Maki Arena contingent upon agreement of a joint powers agreement by all seated JPA parties. 2. Approve the ability to sell naming rights to the new sheet and naming rights to the arena(Schmitz-Maki retains the current sheet and our group recognizes their instrumental contribution to our community)contingent on City Council/Parks and Recreation approval. 3. Approve the ability to sell sponsorship opportunities in the new rink with sponsored player benches, scoreboard, penalty boxes, scorer's table, locker room and seats contingent upon City Council approval. 4. Approve the ability to sell sponsorship on dasher board panels for upfront capital investments over a period of five to ten years, contingent upon City Council approval. 5. Approve the ability to sell pucks for donations for our$500K wall which will be mounted at the new sheet on the wall in the format of a"TIGERS" display. 6. Approve a joint working session alongside JPA parties to reach mutual agreement on a JPA. Mayor Larson stated we are asked to vote on these six items. Everything is contingent on a Joint Powers Agreement between the City, School, and hockey association. There are no fmances discussed now,because we do not know what everyone wants. That will be worked out within the Joint Powers Agreement. Councilmember May noted the Park and Rec Commission discussed it further, and she agrees with them. She did not understand the Council approving sponsorship opportunities. It sounds like a City project if we grant that approval. She would like to get some legs under the JPA first and felt approval of sponsorships would be part of the JPA. She thought Council should be saying if everything moves through, you can build it there. We haven't seen any numbers and there is no fmance plan. It sounds good and looks good, but there is no fmancial proposal, only a range. When talking about selling sponsorships, she would like some feedback from the JPA. If there is public financing involved, is that the City,the school, is it all private, because then it would be moot for the Council to grant approval to sell sponsorships. Mr. Junker stated there are some higher value sponsorship opportunities and their goal is, after the first couple JPA meetings,to go out and get those sponsorships. The JPA is setting the dollar amounts for things like sponsoring a score board,or a player bench. The approval to sell them is something they would like to have so as they solicit those sponsorships,they know they can fill that area of the triangle. Councilmember May asked why the Council would grant that approval. Mr. Junker stated they wanted to make sure they covered all the bases. Councilmember May would like to keep it very simple and say if it all works out,you can build it there, but a lot of things have to fall into place. Mayor Larson stated this is the first step in many steps to come. It is important for them to secure those sponsorships so they can bring that sponsorship money to the JPA committee so we know where the 9 Council Minutes(Regular) September 17,2012 Page 6 fmances start. Councilmember May stated she would vote for items 1 and 6. Councilmember May stated she is not a fan of public fmancing. There are a lot of other needs in the community. Councilmember Donnelly stated we are not committing any City money at this point. At the workshop they presented how it actually makes the two rinks self- supporting. He understood the need and it is contingent on a JPA. Councilmember Bartholomay agreed with all items. The JPA will be the crucial piece. He understood needing permission for the donors to make a commitment. Councilmember Fogarty stated for ten years she has heard we need a second sheet. She was excited to see a group make it a community effort and that understands the City cannot write a check for a second sheet of ice. Of all the proposals,this is the most realistic and tangible thing she has ever seen brought to the City. She supported anything that brings the community together and starts with the community and is brought to all elected officials. You are talking about six to eight entities and that is how these things get done. The City and School Board cannot write a check for things like this. There are real needs in the community, so this falls low on the list. When there is a community effort you take notice. She thanked those involved in this and for their work going forward. She completely supports this. Mayor Larson stated this is the first step in many to come. Everything is contingent on the JPA. It is important that all items are part of the motion. MOTION by Fogarty, second by Bartholomay to approve all of the requested items. Voting for: Larson, Bartholomay, Donnelly, Fogarty. Voting against: May. MOTION CARRIED. MOTION by Fogarty, second by Larson to appoint Councilmembers Donnelly and Bartholomay to the Joint Powers group. APIF,MOTION CARRIED. 13. COUNCIL ROUNDTABLE Councilmember Fogarty: Congratulations to the football team on their third win this season. Thank you to the Rotary for a great Ramble Jam. Councilmember May: She hoped the ice arena works out. She voted no because she did not agree with all the items and wished them luck. She thanked all the volunteers for Ramble Jam. Most of the money raised goes back to the community. There was a note about the refund from the workers' compensation insurance of$72,000 going to the employee expense fund. She asked why it goes there and not to the general fund. City Administrator McKnight will look into it. Councilmember May would like to know what is paid out of the fund and what is the current balance. That is also related to item 7c) about the health insurance medical loss ratio going to that fund. Regarding the salary increase investigation, although nothing illegal was found, she still felt there were things as far as the process. The process will be reviewed. 10 Council Minutes(Regular) September 17,2012 Page 7 City Administrator McKnight: Absentee voting starts September 21, 2012, for the general election. Four of the six precincts have changed, so voters need to make sure they know where to vote in November. Residents received a card from the county with their new polling location. City Engineer Schorzman: Seal coating of the trails along Pilot Knob will begin next week. Mayor Larson: He thanked Councilmember May, City Administrator McKnight, the Rotary, and all volunteers for a successful Ramble Jam. It was a great time and hundreds of hours were put into the event. A GROW Farmington meeting was held, and they are trying to bring a Shop Local campaign to Farmington. They want people to think of Farmington first to support local businesses. 14. ADJOURN MOTION by Fogarty, second by Bartholomay to adjourn at 7:58 p.m. APIF,MOTION CARRIED. Respectfully submitted, Cynthia Muller Executive Assistant 11