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04-11-2006 CCM MINUTES REGULAR MEETING - HUTCHINSON CITY COUNCIL TUESDAY, APRIL 11,2006 1. CALL TO ORDER - 5:30 P.M. Mayor Steve Cook called the meeting to order. Members present were Bill Arndt, Kay Peterson, Jim Haugen and Casey Stotts. Others present were Gary Plotz, City Administrator, John Rodeberg, Public Works Director and Marc Sebora, City Attorney. 2. INVOCATION - Due to the absence of Rev. Sam Grozdanov, Shalom Baptist Church, the invocation was dispensed. 3. PLEDGE OF ALLEGIANCE Congressman Collin Peterson presented before the Council. Congressman Peterson noted that his office has been working on funding for the Crow River Dam reconstruction, however it is being held on the Senate side currently. His office has also been working on assisting with the Hwy 7 project. The majority of his time has been spent heading up the United States Agricultural Committee. A hot topic is ethanol plants and incorporating more E85 pumps at fuel stations. Mayor Cook thanked Congressman Peterson and his staff for all of their assistance to the City. 4. MINUTES (a) REGULAR MEETING OF MARCH 28, 2006 Motion by Stotts, second Peterson, to approve the minutes as presented. Motion carried unanimously. 5. CONSENT AGENDA (a) REPORTS OF OFFICERS, BOARDS AND COMMISSIONS 1. FIRE DEPARTMENT MONTHLY REPORT FOR MARCH 2006 2. MOTOR VEHICLE MONTHLY REPORT FOR FEBRUARY 2006 3. HUTCHINSON AREA HEALTH CARE BOARD MINUTES FROM FEBRUARY 16,2006 4. BULDING DEPARTMENT MONTHLY REPORT FOR MARCH 2006 5. PUBLIC LIBRARY BOARD MINUTES FROM FEBRUARY 27, 2006 (b) RESOLUTIONS AND ORDINANCES 1. RESOLUTION NO. 12934 - RESOLUTION FOR PURCHASE (AERATORS, PALLET SOCKS, SHRINK WRAP AND FORD FREESTAR) 2. ORDINANCE NO. 06-0432 - AN ORDINANCE APPROVING FRANCHISE AGREEMENT WITH AQUARIA PETS FOR THE PURPOSE OF ALLOWING THE PLACEMENT OF A BICYCLE RACK LOCATED ON PUBLIC RIGHT-OF-WAY (SECOND READING AND ADOPTION) (c) APPOINTMENTS TO LIBRARY BOARD . YVONNE MEYER JOHNSON TO APRIL 2009 . ANN VANCE TO APRIL 2009 (d) REAPPOINTMENT OF LYNN OTTESON TO PLANNING COMMISSION TO MARCH 2011 CITY COUNCIL MINUTES - APRIL 11, 2006 (e) CONSIDERATION FOR APPROVAL OF PREMISES PERMIT APPLICATION FOR AMERICAN LEGION POST 96 TO OPERATE GAMBLING DEVICES AT LAMPLIGHTER FAMILY RESTAURANT (t) CONSIDERATION FOR APPROVAL OF SHORT-TERM GAMBLING LICENSE FOR HUTCHINSON FIRE RELIEF ASSOCATION ON SEPTEMBER 16,2006, AT 904 HWY 15 SOUTH (g) CONSIDERATION FOR APPROVAL OF SHORT-TERM GAMBLING LICENSE FOR ST. ANASTASIA CATHOLIC CHURCH ON SEPTEMBER 10,2006, FOR FALL FESTIVAL (h) CONSIDERATION FOR APPROVAL OF SHORT-TERM 3.2 MALT LIQUOR LICENSE FOR ST. ANASTASIA CATHOLIC CHURCH ON SEPTEMBER 9 & 10,2006, FOR FALL FESTIVAL (i) CONSIDERATION FOR APPROVAL OF TRANSIENT MERCHANT LICENSE FOR DEAN SCHLUETER TO OPERATE GREENHOUSE IN THE PARKING LOT OF PREVIOUS CUB FOODS BUILDING (j) CONSIDERATION FOR APPROVAL OF MASSAGE LICENSE FOR HEIDI PULKRABEK LOCATED AT 47 NORTH MAIN STREET (k) CONSIDERATION FOR APPROVAL OF LIQUOR LICENSE RENEWAL FOR RAUL PRIETO OF MARIACHI FIESTA MEXICAN RESTAURANT (1) RETAIL ON-SALE, NON-INTOXICATING MALT LIQUOR (3.2 BEER) LICENSE RENEWALS · HUTCHINSON HUSKIES BASEBALL ASSOCIATION · LITTLE CROW BOWLING LANES (HUTCH BOWL) · SKY VENTURES (PIZZA HUT) (m)RETAIL OFF-SALE, NON-INTOXICATING MALT LIQUOR (3.2 BEER) LICENSE RENEWALS · COBORN'S INC - CASHWISE · SPEEDWAY SUPERAMERICA · ERICKSON'S DIVERSIFIED CORPORATION (ECONO FOODS) · PHILLIPS 66 · W ALMART SUPERCENTER (n) CONSIDERATION FOR APPROVAL OF OUT-OF-STATE TRAVEL FOR MARION GRAHAM, REGULATORY SPECIALIST, TO ATTEND THE CENTRAL STATES WATER ENVIRONMENT ASSOCIATION ANNUAL MEETING FROM MAY 7 -11, 2006, IN ST. CHARLES, ILLINOIS (0) CONSIDERATION FOR APPROVAL OF ADVERTISING FOR BIDS FOR BAG FILM (p) CONSIDERATION FOR APPROVAL OF ADVERTISING FOR BIDS FOR PEAT (q) CONSIDERATION FOR APPROVAL OF CHANGE ORDER NO. 1 FOR THE WATER TREATMENT PLANT (LETTING NO.6 PROJECT NO. 06-02) (r) CONSIDERATION FOR APPROVAL OF IMPROVEMENTS RELATED TO DENVER AVENUE SE (LETTING NO.3, PROJECT NO. 06-03) - ORDERING PREPARATION OF REPORT ON IMPROVEMENT AND RECEIVING REPORT AND CALLING HEARING ON IMPROVEMENT Items 5(n), 5(i), 5(q), 5(r) were pulled for separate action. Motion by Stotts, second by Arndt, to approve consent agenda with the exception if the above-noted items. 2 CITY COUNCIL MINUTES - APRIL 11, 2006 Motion carried unanimously. Item 5(i) had further discussion. Mayor Cook suggested that staff confirm that the applicant has received permission to use this property's parking lot. Motion by Stotts, second by Arndt, to approve Item 5(i) with the condition that permission has been received by property owner to use the parking lot. Motion carried unanimously. Item 5(n) had further discussion. Council Member Stotts asked how this out-of-state travel request will benefit the City. John Rodeberg, Public Works Director, noted that the Central States Water Environment Association provides regional support for water-related environmental regulation, which is the main focus of the regulatory specialist. The type of work that is completed by this position mainly relates to water runoff from construction sites, permitting, etc. This includes daily enforcement with contractors, builders, property owners, etc. By attending this regional meeting, the regulatory specialist will receive the training and information she needs to keep current with regulations. Motion by Peterson, second by Haugen, to approve the out-of-state travel request. Roll call vote was taken: Haugen - aye; Arndt - aye; Peterson - aye; Stotts - nay; Cook - aye. Motion carried 4 to 1. Item 5(q) had further discussion. Mayor Cook asked for an update on the water treatment plant. John Rodeberg stated that things are going very well with the contractor. Scott Young, Earth Tech, explained that this change order is to install some additional sump pits that are needed. Mr. Young explained that the project is progressing on pace. Motion by Haugen, second by Stotts, to approve Change Order No.1 - Water Treatment Plant. Motion carried unanimously. Item 5(r) had further discussion. Mayor Cook clarified what this action item is. John Rodeberg explained that this is the first step to determine whether or not to proceed with construction of an extension to Denver Avenue, informing the property owners what the costs will be. Motion by Stotts, second by Arndt, to approve calling for hearing on Letting No.3, Project No. 06-03. Motion carried unanimously. 6. PUBLIC HEARINGS - 6:00 P.M. (a) CONSIDERATION FOR APPROVAL OF IMPROVEMENT RELATED TO STATE HIGHWAY 7 (LETTING NO.1, PROJECT NO. 06-01) . ACCEPTING BID . ADOPTING ASSESSMENT Kent Exner, City Engineer, presented before the Council. Mr. Exner explained that staff wishes to keep the public hearing open and continue it on April 25, 2006. An open house will be held on April 20, 2006, from 5:00 -7:00 p.m. in the Council Chambers to gain more comments from the affected property owners and allow staff the opportunity to discuss one-on-one with property owners on their speCific issues. Mr. Exner explained that Mn/DOT intends to begin construction the week of April 24, 2006. Although the Main Street bridge may begin earlier than anticipated, the remainder of the proj ect is scheduled to remain as earlier presented. The project area runs on JiWY 7 from High Street/5th Avenue on east end to Shady Ridge Road on west end and Highway 15 from 5 Avenue North to 2nd Avenue North. The total City project costs are estimated at $5.3 million. Funding will be covered by the trunk sanitary sewer fund, the trunk watermain fund, city bonding and assessments. The assessments account for less than 18% of the total City project cost or approximately 3% of the total project cost. The City will be paying for trunk/lateral sanitary sewer and watermain system reconstruction, traffic signal systems and general street/drainage assessments along all City/Park/State properties, intersections and side street right-of-way frontages. The property owner pays for sanitary sewer and water service replacements and/or upgrades and general street/drainage assessments along private property frontages. 3 CITY COUNCIL MINUTES - APRIL 11, 2006 Mr. Exner then shared the calculated assessments, which are lower than the estimated assessments and lower than major projects completed in the last couple of years. Mr. Exner also shared the calculation used to determine the cost per linear foot and the property differences that are along the project. Lastly, Mr. Exner shared information on the assessment process. John Rodeberg recommended approving the resolution accepting the bid and adopting assessment tonight, since the work is scheduled to begin April 24, 2006. Mayor Cook asked about those property owners whose work will not be started until phase 2 or phase 3. John Rodeberg noted that traditionally the entire assessments are due at the same time due to bonding issues. Staff is looking at alternative ways to address this. On this project, the City has to pay 65% of the project costs this year with the remainder due when the project is complete. Jamie Emans, 885 Hwy 7 West, presented before the Council. Mr. Emans noted that he was shocked by the amounts of the assessment amount. Mr. Emans questioned the language on his notice that addresses the 6" water pipe and the deferment of the payment or connection to service. John Rodeberg addressed Mr. Emans issue. Mr. Emans also asked about the + 1 % that is added to the interest rate. John Rodeberg stated that this + 1 % goes for financial service costs incurred by the City. Mr. Emans also noted that he is in Phase 3 of the project and does not feel he should have to pay interest on work that has not been started. Ken Merrill addressed different bonding scenarios that might address this issue. Mr. Emans stated he was told the detouJi route would go along the service road. John RodeberJP stated that the detour route has been scheduled for 5 Avenue since the project was created, however 3 Avenue will be an alternative access road. John Rodeberg noted that access will be provided to Mr. Emans' property. T om Daggett, Hutchinson Manufacturing, presented before the Council. Mr. Daggett officially went on the record to appeal his assessments. Louis Brunner, 968 Hayden Avenue, asked what time the open house was on April 20th. Motion by Arndt, second by Peterson, to continue the public hearing to April 25, 2006, at 6:00 p.m. Motion carried unanimously. Motion by Peterson, second by Stotts, to accept bid and award contract related to Letting No.1, Project No. 06-01. Motion carried unanimously. 7. COMMUNICATIONS. REQUESTS AND PETITIONS (a) PRESENTATION BY CAM RUCKS, FINANCIAL CONSULTANT, ON CREEKSIDE FINANCIAL INFORMATION Ken Merrill, Finance Director, presented before the Council. Mr. Merrill explained that the financial numbers being presented are unaudited 2005 figures. At this time, the refuse - recycle accounts are showing a net income (loss) of ($69,888.08). This loss incorporates depreciation, however the cash flow is on the positive side. An unaudited balance sheet was also presented. Mr. Merrill also presented a Compost financial statement which shows a net income (loss) of ($278,001.35). This again mcludes depreciation expenses. Cash flow is pretty much at a break-even point. Ken Merrill also provided information on bagging operations. One major difference from 2005 to 2006 is the reduction in labor hours. Mr. Merrill noted that the facility is anticipated to have a positive outcome by year end. (Council Member Stotts left the meeting at 7:00 p.m.) (b ) WATER BILLING SYSTEM CONVERSION UPDATE Ken Merrill, Finance Director, presented before the Council. Mr. Merrill explained that by the end of this week it is expected that the utility bills will be printed off of the new system. Mr. Merrill emphasized that each customer has a new account number and customer number. 4 CITY COUNCIL MINUTES - APRIL 11, 2006 Council Member Haugen suggested that HUC incorporate automatic payments as water billing has set up. Mayor Cook noted he will mention this at the next HUC meeting. 8. UNFINISHED BUSINESS (a) ADOPT COUNCIL 2007 BUDGET PARAMETERS Mayor Cook noted that the Council had held a workshop on this topic. Since the last time this topic appeared on the agenda, the City received word that additional local government aid will be distributed that the City had not anticipated. Ken Merrill, Finance Director, presented before the Council. Mr. Merrill presented modifications to the parameters that were presented at the last City Council meeting. These include increasing the general fund m 2007 by 4.3%, increasing local government aid from 2006 to 2007 allocated to the general fund, and a 3.7% maximum total tax levy increase in 2007. These parameters are based on assumptions. Motion by Peterson, second by Haugen, to adopt the 2007 budget parameters as modified. Motion carried unanimously. 9. NEW BUSINESS (a) CONSIDERATION FOR APPROVAL OF LEASING TROMMEL SCREEN EQUIPMENT FOR CREEKSIDE COMPOST FACILITY Doug Johnson, Compost Site Coordinator, presented before the Council. Mr. Johnson explained this type of machine is used for debagging for the Minneapolis contract. It can also be used for screening. This equipment would be purchased via lease to purchase with 100% of the lease payments being applied to the purchase of it. Motion by Arndt, second by Peterson, to approve leasing to purchase trommel screen equipment for Creekside Compost Facility. Motion carried unanimously. (b) CONSIDERATION FOR APPROVAL OF AGREEMENT WITH RW FARMS FOR DEBAGGING MATERIAL FOR CREEKSIDE COMPOST FACILITY Doug Johnson, Compost Site Coordinator, presented before the Council. Mr. Johnson explained that this contract is to provide for disposal of non-residual yard waste products in the possession of the City and the procurement of compost to be used in the City's compost operations. The processes that RW Farms will take on for the compost facility are very labor intensive and not cost-effective for the facility to process themselves. By entering into this contract, one of the benefits is that the compost facility will not be grinding brush on site and it has the ability to rid of reject products. Motion by Arndt, second by Peterson, to approve agreement with RW Farms for debagging material for Creekside Compost Facility. Motion carried unanimously. (c) CONSIDERATION FOR APPROVAL OF TRANSFER SITE MANAGEMENT AGREEMENT WITH JERRY BLOCK AND CREEKSIDE COMPOST FACILITY Doug Johnson, Compost Site Coordinator, presented before the Council. Mr. Johnson explained that Jerry Block Farms managed the transfer site last year and staff was very pleased with the outcome. Jerry Block is very aware of the trucking processes needed for the Minneapolis contract as he has been involved with Creekside since the Minneapolis contract was awarded. Motion by Arndt, second by Haugen, to approve transfer site management agreement with Jerry Block for Creekside Compost Facility. Motion carried unanimously. (d) CONSIDERATION FOR APPROVAL OF ADOPTING NEW DESIGN STANDARDS BY ORDINANCE 5 CITY COUNCIL MINUTES - APRIL 11, 2006 . SUMP DISCHARGE CONNECTION TO CURB DRAIN . CONCRETE DRIVEWAY PANEL AND CURB OPENING . PUBLIC UTILITY SERVICE INSTALLATIONS John Rodeberg noted that the changes/additions that would need to be added to current ordinances to incorporate the above-described design standards. Staff is requesting approval of the first reading of the sump discharge connection to curb drain and approval ofthe drawings that will be included with the current two ordinances that address driveway panels and curb openings and public utility service installations. Motion by Peterson, second by Haugen, to approve first reading and set second reading and adoption for April 25, 2006, on Ordinance No. 53.036. Motion carried unanimously. (e) CONSIDERATION FOR APPROVAL OF AGREEMENT WITH BERKLEY RISK ADMINISTRATORS Ken Merrill, Finance Director, presented before the Council. Mr. Merrill explained that Berkley Risk Administrators (BRAC) manage the risk management services for the City. They provide oversight on the City's self-insurance health and dental program, as well as liability and comprehensive insurance coverage. Even though the initial request from BRAC was to increase the contract rate from $800 to $900 per month in 2006 and $1200 in 2007, due to rate increase concerns by the Mayor, BRAC has suggested that the rate remain as is and true costs be analyzed and rates determined based upon the analysis. The City and HUC split the rates. Motion by Peterson, second by Arndt, to approve agreement with Berkley Risk Administrators at $800 per month. Motion carried unanimously. (t) CONSIDERATION FOR APPROVAL OF RETAINAGE AGREEMENT WITH GRID OR CONSTRUCTION FOR WATER TREATMENT PLANT Ken Merrill, Finance Director, presented before the Council. Mr. Merrill explained that the contractor has requested an alternative to withhold retainage dollars under the contract with the City for construction of the water plant. This can be done in lieu of retainage to provided investments held by a third party in the name of the City of Hutchinson. The securities will be placed in the name of the City and only the City can release them. A monthly report will be received from the security company. Motion by Haugen, second by Peterson, to approve retainage agreement with Gridor Construction for Water Treatment Plant. Motion carried unanimously. (g) CONSIDERATION FOR APPROVAL LIQUOR HUTCH LOAN AND REPAYMENT SCHEDULE Ken Merrill, Finance Director, presented before the Council. Mr. Merrill explained that when the liquor store reconstruction was approved, it was understood that the project would be financed with a loan from the water sewer fund. A loan repayment schedule for $1.4 million has been created by Ehlers & Associates. The loan is for 15 years with interest beginning December 1,2005, and each payment due December 1 of each year. Interest rate would be at 4.25%. Motion by Haugen, second by Arndt, to approve Liquor Hutch loan and repayment schedule. Ken Merrill noted that the liquor fund is a stand-alone fund being financed primarily by sales. Motion carried unanimously. (h) CONSIDERATION FOR APPROVAL OF SETTING COUNCIL WORKSHOP FOR APRIL 25, 2006, AT 3:00 P.M. TO DISCUSS CITY INDEBTEDNESS AND BONDING Motion by Peterson, second by Haugen, to approve setting City Council Workshop for April 25, 2006, at 3:30 p.m. to discuss City indebtedness and bonding. Motion carried unanimously. (i) CLOSED SESSION UNDER MINNESOTA STATUTE 13D.05, SUBD. 3(C) TO CONSIDER 6 CITY COUNCIL MINUTES - APRIL 11, 2006 PROPERTY ACQUISITION (ROLFE PROPERTY NEAR HUTCHINSON MANUFACTURING AND DENVER AVENUE PROPERTY NEAR APPLEBEE'S AND RIDGEW ATER COLLEGE) Motion by Peterson, second by Arndt, to move into closed session at 8:10 p.m. Motion carried unanimously. The meeting reopened at 8:46 p.m. by Arndt, second by Peterson. Motion carried unanimously. 10. MISCELLANEOUS (a) COMMUNICATIONS Jared LaFave, 228 Grove Street, presented before the Council. Mr. LaFave would like to present information on mosCI.uito control. Because John Rodeberg had to leave the meeting, Mr. LaFave said he will present the informatiOn at the next City Council meeting. Council Member Arndt - Bill Arndt raised concerns about loud noise throughout the city. He also raised concerns about dilapidated buildings throughout the city. Gary Plotz - Mr. Plotz updated the Council on outcome-based budgeting. He and the mayor met with Public Strategies last week and a management team will be established to implement the program. Some names have been brought forth, such as Tom Kloss and DolfMoon. The Mayor and Gary Plotz will also be part of this team. If other staff members or anyone from the public is interested in serving on the team, they should contact Gary Plotz. Mayor Cook - Steve Cook commented on spring clean-up issues and other alternatives that may be able to be looked at. 11. CLAIMS. APPROPRIATIONS AND CONTRACT PAYMENTS Motion by Arndt, second by Haugen, to approve claims, appropriations and contract payments. Motion carried unanimously. 12. ADJOURN With no further business to discuss, the meeting adjourned at 8:47 p.m. with a motion made by Arndt and seconded by Peterson. Motion carried unanimously. ATTEST: Steven W. Cook, Mayor Gary D. Plotz, City Administrator 7