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HomeMy WebLinkAbout10.15.12 Council Minutes 7a. COUNCIL MINUTES REGULAR October 15, 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; Robin Hanson, Finance Director;Kevin Schorzman, City Engineer;Todd Reiten, Municipal Services Director;Brenda Wendlandt, Human Resources Director;Tony Wippler,Assistant City Planner; Cynthia Muller, Executive Assistant Audience: 4. APPROVE AGENDA Councilmember Bartholomay pulled item 7c)Approve City Insurance Contribution for Non-Bargaining Employees. Councilmember May pulled item 7fl Amend City Administrator Code. City Administrator McKnight noted there is a supplemental item 7q)Appointment Recommendation Liquor Operations. MOTION by Fogarty, second by May to approve the Agenda. APIF,MOTION CARRIED. 5. ANNOUNCEMENTS 6. CITIZEN COMMENTS 7. CONSENT AGENDA MOTION by Fogarty, second by Donnelly to approve the Consent Agenda as follows: a) Approved Council Minutes(10/1/12 Regular)(10/8/12 Workshop) b) Received Information Third Quarter 2012 New Construction Report and Population Estimate—Building Inspections d) Set November 9, 2012 for a Special Council Meeting-Administration e) Adopted ORDINANCE 012-648 Modifying Wine and 3.2 Beer License Requirements-Administration g) Approved Temporary On-Sale Liquor License Knights of Columbus- Administration h) Authorized Commercial Listing Agreement for 431 Third Street Property- Administration i) Accepted Resignation Parks and Recreation Commission-Administration 7 Council Minutes(Regular) October 15,2012 Page 2 j) Adopted ORDINANCE 012-650 Increasing Maximum Lot Coverage Requirement in R-2 Zoning District-Planning k) Adopted ORDINANCE 012-651 Permitting Twin Home Dwellings in the R-3 Zoning District-Planning 1) Approved Apprize Technology Agreement—Human Resources m) Approved School and Conference-Finance n) Approved School and Conference-Finance o) Approved School and Conference-Fire p) Approved Bills q) Approved Appointment Recommendation Liquor Operations—Human Resources APIF,MOTION CARRIED. c) Adopt Resolution—Approve City Insurance Contribution for Non- Bargaining Employees-Administration When this item was discussed, Councilmember Bartholomay understood Council wanted the fmal amounts to be zero,where employees would not receive a check, but he did not think Council wanted employees to have to pay in under the single plan. Councilmember May didn't think they said no one would pay in, but the fact that those who waive coverage are getting cash, and the City Administrator did follow up with an update. It was not Council's desire for anyone who waived coverage to get a check. City Administrator McKnight stated the base plan was to be the single$2500 HSA,where in 2013 the City's contribution would equal the contribution for the health premium, dental, life insurance and half the deductible. The other plans would pay more depending on which plan was chosen. These are for the non-represented employees. This will affect 19 non-union employees. Councilmember May still preferred a percent of the cost of the plan,where the City offers health insurance programs and the employee has different options to choose from and the City would pay a certain percent of the cost. This recommendation is a good step in the right direction. She does disagree that if you waive coverage you get a check, but we are taking a step in the right direction. Councilmember Fogarty asked about the dollar amount of the difference. City Administrator McKnight stated the base plan is the $2500 deductible HSA plan. Those employees went from receiving$146.90 as left over money in 2012 to zero dollars left over in 2013. The co-pay plan went from having benefits paid for in 2012 to paying$91.33/month. The $1500 single HRA plan went from receiving $96/month to paying $58.83 out of pocket. The$2500 single HRA plan went from receiving$108/month to paying$41.50 out of pocket. Family plans already pay out of pocket and will pay more in 2013. We were able to adjust the single contributions to one number and the family contributions to one number. Councilmember Fogarty noted for the HRA plans the City is contributing money to that. City Administrator McKnight stated the City is required to contribute. For 2013 on the HSA plan the City will be contributing half of that amount as 8 Council Minutes(Regular) October 15,2012 Page 3 well. Councilmember Donnelly noted City Administrator McKnight did what Council asked him to do. Employees do not receive checks unless they waive coverage. MOTION by Fogarty, second by May to adopt RESOLUTION R39- 12 setting the 2013 non-union City benefits contribution. Voting for: Donnelly, Fogarty,May. Voting against: Bartholomay. Abstain: Larson. MOTION CARRIED. f) Adopt Ordinance—Amend City Administrator Code-Administration Councilmember May stated when someone is hired we receive a memo under the Consent Agenda. When adding promotions,job titles, etc. and Council is asked to approve them, she is not questioning the approval, but does not want to see it on the Consent Agenda. She did not want to micro-manage but wanted more information than a memo on the Consent Agenda. She would like some background prior to it being on the agenda, or have some discussion during a prior workshop. If it is buried on the Consent Agenda, it would not change anything. City Administrator McKnight stated so you know why we are making the change. MOTION by Fogarty, second by Donnelly to adopt ORDINANCE 012-649 approving the proposed changes to the City Administrator powers, duties and limitations section of the City code. APIF,MOTION CARRIED. 8. PUBLIC HEARINGS a) Adopt Resolution—Parkview Ponds Easements Vacation-Planning The City is recommending vacating drainage and utility easements on seven lots in Parkview Ponds. Properties affected include: 19690 Dover Drive(Lot 23, Box 2,Parkview Ponds) 19730 Dover Drive(Lot 24, Block 2,Parkview Ponds) 19760 Dover Drive(Lot 25, Block 2,Parkview Ponds) 19800 Dover Drive(Lot 1, Block 3, Parkview Ponds) 19806 Dover Drive(Lot 2, Block 3, Parkview Ponds 19824 Dover Drive(Lot 5, Block 3, Parkview Ponds) 19830 Dover Drive(Lot 6, Block 6, Parkview Ponds) The easements will be reduced to various widths. With the construction of Diamond Path,the swale will be constructed within the right-of-way of Diamond Path so the easements are no longer needed. MOTION by May, second by Fogarty to close the public hearing. APIF,MOTION CARRIED. MOTION by Fogarty, second by Donnelly to adopt RESOLUTION R40-12 vacating the portions of drainage and utility easements on the rear of the lots described above of the Parkview Ponds plat. APIF, MOTION CARRIED. b) Adopt Resolution—Delinquent Municipal Services Assessments-Finance Notice was sent a month ago to delinquent accounts. The current outstanding balance is $426,930. Finance Director Hanson thanked the Finance staff and those at the front desk for the tremendous amount of work on this. 9 Council Minutes(Regular) October 15,2012 Page 4 Councilmember May asked who made the decision to certify anything that is past due and do we have that authority without notice? Finance Director Hanson stated anything that is 30 days or more delinquent is eligible to be certified. Historically,that has not been the practice. For example, an account could have been delinquent in April, was not certified until fall, and did not show up on the taxes until the next year. So it was a long time before the utility receipts were collected by the City. Those that were delinquent in the summer and fall, did not get certified until the next year. In talking with other cities,we learned we were not certifying as often as we could to collect those balances. So this year we took those accounts that were 30 days or more delinquent as of the cut off period and included them in the certification. Councilmember May recalled last year there were a number of people that were landlords,which there are more of now. It is not always the practice to keep the bills in the homeowner's name, so there is no notice to them. We have talked in the past that we do not send out late notices to the landlords even though they are the ones ultimately responsible for the bill. Finance Director Hanson stated staff is aware of that situation and the tenant receives the bill, and the landlord receives a courtesy copy, if the City is aware of a landlord—tenant situation. Councilmember May had a concern with the 30 days. Those landlords do not have a lot of time to collect the fee from the tenant. She felt it should be at least 60 days. Councilmember May asked about the number of those 30 days overdue versus 60 days. Staff did not break them out. Finance Director Hanson stated if they were 30 days delinquent as of August 31, they are 75 days delinquent as of today. We certify once a year and the cut off is always August 31. There is also a$25 certification fee added if not paid by today. Everyone was notified the end of August and they had until October 15,2012,to pay. MOTION by Fogarty, second by Donnelly to close the public hearing. APIF,MOTION CARRIED. MOTION by Fogarty, second by Bartholomay to adopt RESOLUTION R41-12 certifying the delinquent accounts as a special assessment to the 2013 taxes of the appropriate properties. APIF,MOTION CARRIED. c) Adopt Ordinance—Approving 2013 Fee Schedule-Administration There are a number of fee changes where were discussed at the October 8,2012, Council workshop. The storm water fee was proposed to increase by$3, but has been changed to $1.50 increase. The solid waste fees were also discussed at the workshop. There were also a couple additional fee changes from the workshop, including a commercial plumbing fee increase from$47 to$63.25, and the SAC fee is going from$2,365 to $2,435/unit. A lot of the fee changes for park and recreation went from a fee plus tax to including tax in the fee. Councilmember Fogarty asked about the antenna fees and thought the Water Board had to approve them. City Engineer Schorzman stated the Water Board approves the fees, but then they are forwarded to Council for incorporation into this ordinance. The fee goes back to the Water Board. 10 Council Minutes(Regular) October 15,2012 Page 5 Councilmember May discussed the storm water utility fee and the dredging of ponds. Before any fee is increased, she wanted to learn more about what study states how often you have to dredge and wanted more information on that subject. We based a lot of decision on a fee from a short meeting without a lot of discussion on the mandate,the age of the ponds, etc. Before we increase any fee, she would like more information on that subject. In addition,there is a lot of borrowing among funds. At the workshop she mentioned she would like to see the status of these funds and the loans associated with the funds. She understood there is short term borrowing, but that is not what she is concerned about. There is a fire truck loan, we owe $200,000 from the EDA to the storm water fund, and before we talk about raising fees for these funds, we need to talk more about the history of these funds and where they are at. City Engineer Schorzman stated there is not a study saying when ponds should be cleaned. We need to survey the ponds to determine the sediment and determine if the ponds need to be cleaned. Mayor Larson stated it has to do with water storage in the ponds and to keep water from going into backyards or into the river. Ponds get filled up with sediment over the years and we need to get that capacity back. Councilmember May noted there are a lot of fees. We talk about a tax levy for the general fund and then we talk about all these fees. The money the City has to raise is for City staff and services. So you have the general fund and then you have the fees. She asked if there could be a simpler way, such as having a general fund that would allow for services and not have so many fees. She understood development fees, but to have a fee for siding or a water softener,perhaps we could do something new and different. Every year we talk about how to increase the general levy and then how to increase fees to pay for staff. Councilmember Fogarty stated some of these could be part of the general fund, but is that the right thing to do. If someone does ten things a year to their home and a neighbor does nothing, should everyone have to pay for those inspections? She liked the philosophy of pay as you go and you pay for the services you use. Councilmember May stated as the years go,the answer cannot always be increase taxes. Councilmember Bartholomay stated these fees are common with every City. We need to make sure we are getting paid for what we are doing. Councilmember Fogarty noted some people use government more than others. Councilmember Donnelly noted they are user fees. Not all the fees went up and there is rationale for why they were increased. Mayor Larson felt we need to find out what we have in the funds and perhaps we would not need as much of an increase. Councilmember May did not know how we can approve an increase to a fund when we don't know what the balance is in the fund. If there are sufficient funds, we don't need to increase it. We are basing the decision off someone telling us we should test the ponds next year. Councilmember Fogarty stated there are costs that are going up next year. She agreed we need to know the fund balances, but that doesn't change what is coming in and going out each year. MOTION by Fogarty, second by Donnelly to close the public hearing. APIF,MOTION 11 Council Minutes(Regular) October 15,2012 Page 6 CARRIED. MOTION by Fogarty, second by Donnelly to adopt ORDINANCE 012-652 approving the 2013 City fee schedule. Voting for: Larson, Fogarty, Donnelly. Voting against: Bartholomay,May. MOTION CARRIED. 9. AWARD OF CONTRACT 10. PETITIONS,REQUESTS AND COMMUNICATIONS a) New 2012 Polling Locations-Administration Executive Assistant Muller informed Council and residents on the location change of four of the six polling locations. b) Preliminary Discussion Bond Refunding-Finance Finance Director Hanson stated the City has the opportunity to refund three different series of bonds. The details will be brought to the November 19, 2012, Council meeting. Staff wanted to inform Council of the options and get some direction. The three series involved are 2005A, 2005B, and 2006A series bonds. The 2005A is the smallest amount with$780,000 outstanding. Rather than incurring the cost of issuance of sale, as there are only two years remaining on the bonds, staff is recommending using funds available in the street construction fund that would otherwise be invested in C.D.'s to pay off the bonds and save the cost of issuance and lower the interest on the bonds. Councilmember May felt we should not make any decision on internal borrowing until we see where the funds are at. She also asked what this would do to our cash flow. It sounds nice to pay yourself the interest,but it can also be a dangerous path. When we should be looking at reducing spending, we are fording easier ways to fmance debt we already have. She felt Council should not make a decision until we understand where we are with the funds. City Engineer Schorzman stated the 2005A bonds are for the Pilot Knob Road project. We went through the road and bridge fund spreadsheet which has plans for how all the bonds get paid off and has a final balance at the end. Staff is proposing to keep it within that box. We are not taking money from a fund,the proposal is to keep it within the box and save money within that box. Finance Director Hanson stated there are sufficient funds to absorb this. By doing this we would save$11,000 in the cost of issuance and the interest rate on the existing bonds which is 4%and they could be perhaps .5%. Mayor Larson asked for the dollar amount saved on the interest. The second bond is the 2005B bonds,which are not redeemable until 2014. We could choose to wait and do nothing or choose to refund the bonds at this time. It is in the City's best interest to include the bonds in the refunding sale. There is a cost to this. The money we would be investing for the next 12-13 months before the bonds are redeemable would cost us$18,000 as the investment earnings would be less than what we are paying. If we wait another year and refund only 12 Council Minutes(Regular) October 15,2012 Page 7 these bonds,the cost of issuance would be$60,000 - $80,000. So we would be ahead by including them now and plan to refund the bonds in 2014. Councilmember May asked if the saving is less if we do all three. Finance Director Hanson stated the savings in the memo is if all three bonds were refunded at this time. Councilmember May suggested taking action on only the 2005B bonds. Staff noted if we funded them now,we would not be able to pay off the existing bonds until 2014. It makes the most sense to do the 2005A and the 2006A, as they are both redeemable now. Councilmember Donnelly stated we cannot pay them off until February 2014, but the environment is good now,we are going to issue a new bond, we will put that money in the bank, and then pay them off in February 2014. We would issue one new bond and get rid of these three series of bonds. If Council does nothing with the previous two bonds,the third option would be to refund all the bonds now and structure the first principal date at a different time. The first principal date now would be February 1, 2013. They were originally intended to be structured to levy the taxes in 2012, collect the taxes in 2013, and make the corresponding principal and interest payments in 2014, so you would have the money in hand. What is happening now, is February 1, 2012,we made a principal and interest payment, we did not collect the corresponding tax dollars until the first installment in June/July. We made the second payment which was interest only on August 1, 2012,and this December we will collect the second half with the end being picked up in January 2013. The City is advancing the payment of those bond payments and collecting the money in arrears. We could continue as is, and the gross savings would be$690,000. If we delay the principal one year so we are collecting taxes the year prior to paying debt service,that is reduced to$605,000. If you take the middle of the road and fund six months the savings is$645,000. That does not include staff time to manage it or the lost investment earnings. Finance Director Hanson recommended refunding the bonds. Councilmember Fogarty stated option one is the best for the cash flow, but will it be strong enough to keep us from going negative? It will do that for these three bonds, but not across the board. Councilmember May could not believe City finances have not been structured to collect money to make payments on the bonds. Finance Director Hanson stated it is a lag. Councilmember Fogarty stated it is just during certain parts of the year that it is negative, at the end of the year it is fine. Councilmember May would like to see the history of the bonds and where the money has gone. Councilmember Donnelly stated all the options save the taxpayer money and we don't know why the timing is the way it is, but we have the option to correct it. He agreed with option one. City Engineer Schorzman stated with option one, if you pay them off now,there is$47,200 in interest associated with the next three years payments. So you are saving$11,000 on the reissuance plus the$47,000 13 Council Minutes(Regular) October 15,2012 Page 8 minus the .5%payback. Councilmember Bartholomay felt it would not hurt to obtain more information and suggested discussing this in a workshop prior to November 19, 2012. Finance Director Hanson stated the 2005A is the only one that would use internal funds from the road and bridge fund. The others would be new bonds. Councilmember Fogarty did not see a reason to wait on the other two. She was open to discussing whether we should do internal borrowing. It seems reducing taxpayer debt is something we should do. City Engineer Schorzman suggested rather than thinking of this as internal borrowing, think of it as an advance payment. There is money there to do it and we would save$58,000. Councilmember May had a concern as Council was talking about cash flow and we still have to collect it. Council discussed whether to have a workshop or ask questions individually. It was determined to have a workshop on November 5, 2012. MOTION by Fogarty, second by Bartholomay to table this for more information and bring back at the City Administrator's discretion. APIF, MOTION CARRIED. c) 2013—2017 Dakota County CIP-Engineering Staff is requesting the 195th Street project from Flagstaff Avenue to Diamond Path be included in the county's 2013—2017 CIP. This includes widening the road, intersection improvements and turn lanes on 195th Street. This project would be scheduled for 2013/2014. MOTION by Fogarty, second by Bartholomay to adopt RESOLUTION R42-12 indicating the City's continuing support for this project being included in the 2013-2017 Dakota County CIP. APIF, MOTION CARRIED. 11. UNFINISHED BUSINESS 12. NEW BUSINESS 13. COUNCIL ROUNDTABLE Councilmember Fogarty: High School sports is having a great year. Congratulations to the Farmington football team. Girls U14 soccer took the state championship. Varsity girls are moving on to the sectional fmals. For the first time in Farmington,three cheerleaders made the all state cheer team. Councilmember Bartholomay: The first Joint Powers meeting for Ice for Tigers was held this evening. Upcoming meetings are November 5 and 19, 2012. Councilmember May: A resident asked about township representation on the joint powers team. This was discussed at the meeting. She asked City Administrator McKnight about the reimbursement of insurance premium to the employee expense fund. Staff is working on this. Regarding the fee schedule, we need to talk about the totals the 14 Council Minutes(Regular) October 15,2012 Page 9 fee increases bring to the bottom line and what that does to the funds and the general fund. Also, what does the fee increase do to that department? City Administrator McKnight: There will not be a formal Council meeting on November 5, 2012, but we will have the workshop. Mayor Larson: Encouraged residents to shop local and invest in the community. Profits from the Farmington liquor stores stay in the community. 14. ADJOURN MOTION by Fogarty, second by Bartholomay to adjourn at 8:57 p.m. APIF,MOTION CARRIED. Respectfully submitted, Cynthia Muller Executive Assistant 15