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03-23-1976 CCMMINUTES REGULAR MEETING - HUTCHINSON CITY COUNCIL MARCH 23, 1976 1. CALL TO ORDER The meeting was called to order at 7:34 P.M. by Mayor Black. Those present were Aldermen Haag, Lueneburg, and Peterson in addition to Mayor Black. Those absent were: Alderman Westlund. Also present were: Administrative Assistant Fleetham, City Engineer Priebe, and City Attorney Schantzen. 2. INVOCATION The Invocation was given by Reverend Manley Swarthout. 3. MINUTES Upon motion by Alderman Lueneburg, seconded by Alderman Peterson, the minutes of the regular meeting of February 25, 1976, the special meeting of February 25, 1976, the special meeting of March 4, 1976 and the regular meeting of March 9, 1976 were approved unanimously. 4. PUBLIC HEARINGS ( ) CONSIDERING A PROPOSED AMENDMENT TO ORDINANCE NO. 560 MODIFYING WATERWORKS AND SEWER DEPARTMENTS - RATES AND CHARGES The Public hearing was opened at 7:50 P.M. The Mayor read the hearing notice. He gave a background of the Council's consideration of the Water and Sewer Department Budget during the 1976 Budget Hearings. The Council had employed the firm of Toltz, King, Duvall Anderson and Associates to review our rates to see if they are providing sufficent monies to meet our expenses. He also stated that while some communities may operate water and sewer utilities to provide a profit, the policy of the Hutchinson City Council was to meet only our capital and operating expenses. Mayor Black then introduced Mr. Rex Stockwell and Mr. DuWayne Kasma of Toltz, King, Duvall, Anderson and Associates for a summary of their study. Mr. Rex Stockwell summarized the Water Rate Study. He identified the following factors: 1. Method of Data Collection 2. Method of Base and Usage Determination 3. Determination of Revenue needed 4. Determination of Service Charge and Commodity Charges 5. Compared Hutchinson's water users highest volume with the proposed rates and the rates of other communities 6. Outlined the Conclusions and recommendations of his Firm Mr. Stockwell went on to review the Sewer Rate Study 1. Method of Data Collection and Method of Base and Usage Determination 30 Council minutes, March 23, 1976 2. The basis of rate study and EPA criteria 3. Reviewed the Useage Charges 4. Determination of the revenue requirements for the future 5. Illustrated how he determined the charges based on service charge and volume 6. Reviewed a proposed surcharge 7. Reviewed the proposed rates on users according to meter size 8. Illustrated the effect on Hutchinson's largest volume users 9. He gave his conclusions and recommendations of the sewer study 10. He reviewed the various methods open to the Council to finance the sewer system giving the advantages and disadvantages of all. Recommended the City proceed to comply with the EPA suggested guidelines. Mayor Black then asked those in attendance in the audience if they had any questions or comments regarding the presentation. Mr. Bill Guse questioned if we anticipated any federal grants for such improvements. City Engineer Priebe indicated yes we did, but doubted if it would be until closer to the end of the five year study period. Mr. Stolpman questioned whether their were minutes being taken after which he was informed yes there were. Mr. Rub Mahron representing 3M questioned when will the rates take effect. Mayor Black responded the first time they could be officially adopted would be the April 13th meeting of the City Council. Administrative Assistance Fleetham responded that they hoped that the first billing of the new rates would take place in May. Mr. Grant Merritt of the firm of Nielsen, Blackburn and Merritt of the Peavey Building was present representing Mr. Jon Geiss of Hutchinson Industrial Corporation. He further stated he had retained the firm of Harry Grounds and Associates as consulting engineers to assist him in his study. He indicated that the proposed rate increase would cause substantial increase for Hutchinson Industrial Corporation. He indicated that they were not against an increase persay but would like time to understand what was happening. He cautioned the Council that they should consider very carefully many different options and advised them that they were faced with a complicated issues and systems. He requested the Council put this over until the next regular Council meeting and that they had only received the report on the 18th of March. He stated that it was a mistake for the Council to pass this upon the first reading and then he called upon Mr. Harry Grounds. Mr. Grounds indicated that he would be providing technical assistance and he had written a letter to TKDA asking for a copy of the study. He indicated that he felt that there were other alternatives than what TKDA had submitted. - 2 - Council minutes, March 23, 1976 Mayor Black indicated that there would be a three week interm period between the first reading and the second reading if the Council gave first reading tonight. Mr. Merritt stated that he believed that a Council approved first reading it was a commitment to approve the second reading. He further questioned the proposed conformance with the EPA requirements and he outlined his experiences in other areas. Mayor Black thanked Mr. Merritt for his comments. Alderman Lueneburg asked Mr. Mahron from 3M what was his response to the rate increase. In response Mr. Mahron said he had not received any input from his engineers in the St. Paul office. Mr. Stolpman then questioned the meter charge, his understanding that there would be two departments established, the increased costs for billing. The Administrative Assistant clarified that it was the setting up of separate accounting systems rather than two separate departments and he also spoke to the cost savings that the Council and the Municipal Utilities Commission were attempting to effect. Mr. Stockwell spoke to the water service base charge and outlined its determination by meter size and the cost and the maintenance of those meters. Mr. Stolpman then spoke against the meter costs stating his was paid for once. He also said it was not possible for him to forecast for his business for five years and said the Council would talk on a different basis if they had to face competition. Mr. Stockwell again outlined his criteria for the conclusions. Mr. Stolpman said that the proposed rates are higher than in any other areas he is aware of and that businessmen cannot face future costs if these are to continue. Administrative Assistant Fleetham again pointed that they are trying to affect as many cost savings as possible in the utility and under- lining that the City is currently undergoing a $100,000 deficit in the Sewer Fund. Mr. Stolpman stated then that the billing of meter charges were in- flated, and he would like more time to prupose an alternative. Mr. Merritt commented on Mr. Fleetham's remarks and questioned how the figures were determined. Administrative Assistant Fleetham and Mr. Stockwell outlined that these are reflecting current costs and the costs for the last five years. Administrative Assistant Fleetham stated that the information TKDA had been provided would be available to anyone who would wish to utilize it for their review. - 3 - Council minutes, March 23, 1976 Mr. Jon Geiss of Hutchinson Industrial Corporation summarized how he believed the costs were decided and questioned how business can forecast their costs. He then stated that the increases should come gradually rather than looking to a base year. Mr. Stockwell responded that these are not sudden increases, but that the increase in revenue also comes from increased volumes that they had projected for the next five years. He explained the 59 cent charge and how that charge and the anticipated expenses for each of the next five years were approximately equal with the projected volume increases. Mr. Geiss questioned the discussion of possible excess funds in the utilities to which Mr. Stockwell replied some excess funds must be available to meet emergencies and unprojected expenditures. Mayor Black summarized that the rate increase must be made but the question boils down to who must pay and the portion that the residential property will pay versus the portion that the commerical property will pay of the burden. Mr. Grant Merritt questioned the billing and the deadlines that he had understood from the Administrative Assistant on the phone that day. Administrative Assistant Fleetham commented that the 13th would probably be the last day that any change could be made and still be reflected in the May billing. Upon the motion of Alderman Peterson, seconded by Alderman Haag, to continue the hearing for three weeks. Motion failed on a 2 to 2 vote with Aldermen Haag and Peterson voting in favor. It was then moved by Alderman Lueneburg, seconded by Alderman Haag, to close the hearing. Motion carried unanimously. It was moved by Alderman Lueneburg, seconded by Mayor Black, to waive first reading and set second reading for April 13, 1976 of Ordinance No. 12/76 entitled, Ordinance Amending Section 560 of the 1974 Ordinance Code of the City of Hutchinson, Entitled Waterworks and Sewer Department - Rates and Charges. Motion failed on a 2 to 2 vote with Aldermen Peterson and Haag voting in opposition to the motion. At a later point in the meeting, it was moved by Alderman Haag, seconded by Alderman Lueneburg, to reconsider the amendment to Section 560 of the 1974 Ordinance Code. Motion carried unanimously. Administrative Assistant Fleetham and Mayor Black asked the City Council questions regarding the deficit and what steps that they would like the Staff to take. Mr. Rex Stockwell and Mr. DuWayne Kasma outlined again the alternative the Council had before and also drew attention to the actual $100,000 deficit that the utility was incurring at - 4 - Council minutes, March 23, 1976 this point. They again outlined the EPA suggested guidelines and reasons for adopting such a rate system. The Administrative Assistant stated that as long as he would know by April 13th he would be in a position to either continue billing at the existing rates using the Burroughs L-5000 or if it was approved utilize the computer for the new rates on the May billing. He stated that he believed that new forms might possibly have to be ordered for the Burroughs, if we were to extend its use any longer than April. It was then moved by Alderman Haag, seconded by Alderman Lueneburg to waive first reading and set second reading for April 13, 1976 of Ordinance No. 12/76, entitled, Ordinance Amending Section 560 of the 1974 Ordinance Code of the City of Hutchinson entitled Waterworks and Sewer Department - Rates and Charges. Motion carried on a three to one vote with Alderman Peterson voting in opposition. 5. COMMUNICATIONS, REQUESTS AND PETITIONS (a) REQUEST OF HUTCH YOUTH HOCKEY ASSOCIATION TO ADDRESS THE CITY COUNCIL The Council was advised that the Association had withdrawn their request at this time. 6. RESOLUTIONS AND ORDINANCES (a) ORDINANCE NO. 5/76 - ORDINANCE AMENDING SECTION 7.02 ENTITLED FISCAL YEARS OF CHAPTER VII OF THE CITY CHARTER CITY OF HUTCHINSON, RELATING TO TAXATION AND FINANCES It was moved by Alderman Haag, seconded by Alderman Lueneburg, to waive second reading and adopt Ordinance No. 502, entitled, Ordinance Amending Section 7.02 Entitled Fiscal Years Chapter VII of the City Charter City of Hutchinson, Relating to Taxation and Finances. Motion carried unanimously with Aldermen Haag, Lueneburg, and Peterson and Mayor Black voting in favor. (b) ORDINANCE NO. 6/76 - ORDINANCE AMENDING SECTION 11.09 ENTITLED FISCAL YEARS OF CHAPTER XI OF THE CITY CHARTER, CITY OF HUTCHINSON, RELATING TO PUBLIC OWNERSHIP AND OPERATION OF UTILITIES It was moved by Alderman Lueneburg, seconded by Alderman Peterson to waive second reading and adopt Ordinance No. 503, entitled, Ordinance Amending Section 11.09 Entitled Fiscal Years of Chapter XI of the City Charter, City of Hutchinson, Relating to Public Ownership and Operation of Utilities. Motion carried unanimously with Aldermen Lueneburg, Haag and Peterson and Mayor Black voting in favor. (c) RESOLUTION NO. 5664 - APPROVING SECURITIES FOR FIRST NATIONAL BANK OF MINNEAPOLIS OF MINNEAPOLIS, MINNESOTA It was moved by Alderman Lueneburg, seconded by Alderman Haag, to - 5 - Council minutes, March 23, 1976 waive reading and adopt Resolution No. 5664 - Approving Securities for First National Bank of Minneapolis of Minneapolis, Minnesota Motion carried unanimously. 7. REPORTS OF OFFICIERS. BOARDS AND COMMISSIONS (a) MINUTES OF THE BURNS MANOR NURSING HOME BOARD MEETING DATED FEBRUARY 18, 1976 There being no discussion, the minutes were ordered by the Mayor received for filing. 8. UNFINISHED BUSINESS (a) DISCUSSION CONCERNING HUTCHINSON ANIMAL SHELTER The Mayor reviewed the proposed animal shelter for South Park and indicated he had received communications of opposition. He did not feel it was the proper place for the animal shelter to be placed. Administrative Assistant Fleetham reviewed several other alternatives for Council consideration. It was moved by Alderman Haag, seconded by Alderman Peterson, to utilize the Park Garage as an animal shelter and authorized the Clerk -Administrative Assistant to contract for alterations to that building in the amount of approximately $3,500. The motion carried unanimously. 9. NEW BUSINESS (a) REQUEST OF TEMPLE CRUSADERS TO HAVE FIRE TRUCK, RESCUE TRUCK AND AMBULANCE PRESENT AT THE HUTCHINSON AIRPORT ON JUNE 6TH After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Haag, to authorize the Fire Department to have vehicles present and request the Hutchinson Hospital to have an ambulance present. Motion carried unanimously. (b) RECOMMENDATION OF ADMINISTRATIVE ASSISTANT REGARDING REORGANIZATION OF CITY MAINTENANCE DEPARTMENTS After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Peterson, to authorize the reorganization of the City Maintenance Departments. Motion carried unanimously. (c) CONSIDERATION OF APPLICATIONS FOR RENEWAL OF CLUB LIQUOR LICENSES The following applications were received: V.F.W. Post No. 906, American Legion Post No. 96, Hutch Elks, Inc., and Crow River Country Club. After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Haag, to approve the applications and authorize the renewal of the Club Liquor Licenses. Motion carried unanimously. - 6 - Council minutes, March 23, 1976 (d) CONSIDERATION OF APPLICATIONS FOR RENEWAL OF LIQUOR LICENSES The following applications were received: The Chalet Supper Club and The Dinner Bell, Tnc. After discussion, it was moved by Alderman Haag, seconded by Alderman Peterson to approve the applications and authorize the renewal of the Liquor Licenses. Motion carried unanimously. (e) CONSIDERATION OF REQUEST FOR CONDITIONAL USE PERMIT FROM FARMERS ELEVATOR ASSOCIATION AND FAVORABLE RECOMMENDATION OF PLANNING COMMISSION After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Peterson, to authorize issuance of a Conditional Use Permit to Farmers Elevator Association for the construction of an elevator, office, warehouse, bulk fertilizer blending plant and a bulk petroleum plant. Motion carried unanimously. (f) CONSIDERATION OF REQUEST FOR CONDITIONAL USE PERMIT FROM HUTCHINSON UTILITIES COMMISSION AND FAVORABLE RECOMMENDATION OF PLANNING COMMISSION After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Haag, to authorize the issuance of a Conditional Use Permit to the Hutchinson Utilities Commission contingent that if Fourth Avenue from Superior Street to Michigan Street was ever vacated, the Utilities Commission would provide an extention of the 8" Watermain from Michigan Street to the rear of their property to provide water for potential fire fighting useage. Motion carried unanimously. (g) CONSIDERATION OF REQUEST FOR VACATION OF EASEMENT BY MR. EMMIT MCCORMICK AND FAVORABLE RECOMMENDATION OF PLANNING COMMISSION After discussion, it was moved by Alderman Peterson, seconded by Alderman Haag, to waive first reading and set second reading for April 13, 1976 of Ordinance No. 14/76, entitled, an Ordinance to Vacate Easement Lying Along West line of Lot 4, Block 2, Stoney Point Addition, Together with the easement Lying Along the East line of Lot 3, Block 2, Stoney Point Addition. Motion carried unanimously. (h) CONSIDERATION OF REQUEST FOR ANNEXATION - ROBB TOTESHEK AND CROW RIVER COUNTRY CLUB AND FAVORABLE RECOMMENDATION OF PLANNING COMMISSION After discussion, it was moved by Alderman Peterson, seconded by Alderman Lueneburg, to waive reading and adopt Resolution No. 5668, entitled, Request for Annexation. Motion carried unanimously. - 7 - Council minutes, March 23, 1976 (i) CONSIDERATION OF COST ESTIMATE FOR SCHOOL ROAD BRIDGE BORINGS After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Peterson, to authorize the firm of Braun Engineering to provide necessary borings. Motion carried unanimously. (j) CONSIDERATION OF SETTING SPECIAL COUNCIL MEETING FOR MARCH 30, 1976 After discussion, it was moved by Alderman Lueneburg, seconded by Alderman Peterson, to set a Special City Council Meeting for 8:00 A.M. on Tuesday, March 30, 1976. Motion carried unanimously. (k) CONSIDERATION OF BURIAL SITE FOR BICENTENNIAL TIME CAPSULE It was the concensus of the Council that City Attorney Schantzen report to the Council on any legal problems that have been encountered on such a burial. 10. MISCELLANEOUS (a) COMMUNICATIONS FROM CLERK -ADMINISTRATIVE ASSISTANT 1. Upon a request of Administrative Assistant Fleetham, it was moved by Alderman Haag, seconded by Alderman Peterson, to increase Intown Mileage Allowance from $25.00 to $30.00 for those individuals who utilize their own vehicles for various municipal functions. Motion carried unanimously. 2. Administrative Assistant Fleetham mentioned the Coalition of Outstate Cities Meeting in St. Paul on March 26th. He and Mayor Black were intending to attend. 3. Administrative Assistant Fleetham reviewed a communication that he received that the City had received word that they would be receiving a Intergovernmental Government Personnel Act Grant in the amount of $4,800. (b) COMMUNICATIONS FROM MAYOR BLACK 1. Mayor Black commented that Administrative Assistant Fleetham, Personnel Coordinator Sitz, and the Chief of Police had reviewed several applicants for the position of Community Service Officer. Upon that reviewal, it was the concensus of the group and the Mayor's appointment of Mr. Mike Monge to the position of the Community Service Officer. It was moved by Alderman Lueneburg, seconded by Alderman Peterson, to ratify the appointment of Mr. Michael Monge to the Position of Community Service Officer. Motion carried unanimously. - 8 - Council minutes, March 23, 1976 2. Mayor Black made the following appointments to the Library Board: Ralph Bergstrom Sally Cone Earl Schmitz It was then moved by Alderman Lueneburg, seconded by Alderman Peterson to ratify said appointments. Motion carried unanimously. 3. Mayor Black noted a Letter of Appreciation for the Police Department's outstanding performance and directed that the proper officer be made aware of the commendation. C. COMMUNICATIONS FROM CITY ATTORNEY SCHANTZEN 1. City Attorney Schantzen requested Council concurrence in ordering two homes below standards to either be improved or demolished. It was moved by Alderman Lueneburg, seconded by Alderman Haag to authorize Mayor Black to sign an order directing that Charles W. Danielson and Viola M. Danielson for structure located on the N 120' of Lot 27, Lynn Addition of the City of Hutchinson. Motion carried unanimously. It was then moved by Alderman Lueneburg, seconded by Alderman Haag, to authorize Mayor Black to sign an order directing that Frank Schiller and Robert Schiller regarding the structure on Lot 2, Block 8, College Addition City of Hutchinson. Motion carried unanimously. 11. CLAIMS, APPROPRIATIONS AND CONTRACT PAYMENTS (a) VERIFIED CLAIMS It was moved by Alderman Lueneburg, seconded by Alderman Peterson that the claims be approved and authorize payment from the appropriate accounts. Motion carried unanimously. 12. ADJOURNMENT There being no further business to come before the Council, the meeting was declared adjourned at 10:17 P.M.on motion by Alderman Haag, seconded by Alderman Lueneburg and carried unanimously. - 9 -