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06-26-2018 CCMHUTCHINSON CITY COUNCIL MEETING MINUTES TUESDAY, JUNE 26, 2018 CITY CENTER — COUNCIL CHAMBERS (The City Council is provided background information for agenda items in advance by city staff, committees and boards. Many decisions regarding agenda items are based upon this information as well as: City policy and practices, inputfirom constituents, and other questions or information that has not yet been presented or discussed regarding an agenda item.) 1. CALL MEETING TO ORDER — 5:30 P.M. Mayor Gary Forcier called the meeting to order. Members present were John Lofdahl, Steve Cook, Chad Czmowski and Mary Christensen. Others present were Matt Jaunich, City Administrator, Marc Sebora, City Attorney and Kent Exner, City Engineer (a) Approve the Council agenda and any agenda additions and/or corrections Matt Jaunich, City Administrator, noted that an item needs to be added under New Business: Approve/Deny Lease Amendment with TNT Air, LLC Motion by Cook, second by Lofdahl, to approve agenda with the additional item noted. Motion carried unanimously. 2. INVOCATION — Our Savior's Lutheran Church 3. PLEDGE OF ALLEGIANCE 4. RECOGNITION OF GIFTS, DONATIONS AND COMMUNITY SERVICE TO THE CITY Council Member Czmowski read a list of organizations that have provided services to the Parks and Recreation Department over the last year. (a) Resolution No. 14908 — Resolution Accepting $500 Cash Donation from Hutchinson Area Community Foundation for Founder's Pathway Landscaping Motion by Czmowski, second by Lofdahl, to approve Resolution No. 14908. Motion carried unanimously. (b) Resolution No. 14909 — Resolution Accepting $54,000 Cash Donation from Hutchinson Elks Lodge for Hutchinson Elks Inclusive Park Tammy Lehn, George Lehn and Paul Ackland from the Hutchinson Elks Lodge presented before the Council. The Elks Lodge presented a check in the amount of $54,000 for the inclusive park at Elks Park and asked the Council to proceed with ordering equipment for the park. Matt Jaunich noted that the actual approval of ordering equipment will need to be considered at the next Council meeting as the request before the Council this evening is to accept the cash donation. This will be considered at the July 2, 2018, special meeting. Motion by Czmowski, second by Christensen, to approve Resolution No. 14909. Motion carried unanimously. PUBLIC COMMENTS (This is an opportunity for members of the public to address the City Council. If the topic you would like to discuss is on the agenda, please ask the Mayor if he will be accepting public comments during the agenda item if not a public hearing. Ifyou have a question, concern or comment, please ask to be recognized by the mayor state your name and address for the record. Please keep comments under S minutes. Individuals wishing to speak for more than five minutes should ask to be included on the agenda in advance of the meeting. All comments are appreciated, but please refrain from personal or derogatory attacks on individuals) CITY COUNCIL MINUTES JUNE 26, 2018 5. CITIZENS ADDRESSING THE CITY COUNCIL Mayor Forcier noted that no comments will be received this evening regarding the invocation policy due to the item being discussed at several previous meetings. 6. APPROVAL OF MINUTES (a) Regular Meeting of June 12, 2018 (b) Workshop of June 12, 2018 Motion by Czmowski, second by Cook, to approve the minutes as presented. Motion carried unanimously. CONSENT AGENDA (The items listed for consideration will be enacted by one motion unless the Mayor, a member of the City Council or a city staff member requests an item to be removed. Traditionally items are not discussed.) 7. APPROVAL OF CONSENT AGENDA (a) Consideration for Approval of Letter of Support for Minnesota Governor's Pheasant Hunting Opener (b) Consideration for Approval of Letter of Support for US Highway 212 BUILD Transportation Discretionary Grant Application (c) Consideration for Approval of Issuing Short -Term Gambling License to Voiture 414 on November 20, 2018, at VFW Post 906 (d) Consideration for Approval of Issuing Short -Term Gambling License to Hutchinson Fire Department Relief Association on September 8, 2018, at Hutchinson Fire Department (e) Consideration for Approval of Improvement Project Change Orders 1. Change Order No. 1 — Letting No. 2, Project No. 18-02 (2nd Avenue SE Bridge Replacement) 2. Change Order No. 1 — Letting No. 6, Project No. 18-06 (2018 Street Seal Coating) (f) Consideration for Approval of Items for Century Avenue SE Reconstruction Project (Letting No. 1, Project No. 18-01) 1. Resolution No. 14910 - Resolution Declaring Cost to be Assessed and Ordering Preparation of Proposed Assessment 2. Resolution No. 14911 - Resolution for Hearing on Proposed Assessment (g) Consideration for Approval of Items for 2018 Pavement Management Program Project (Letting No. 4, Project No. 18-04) 1. Resolution No. 14912 - Resolution Declaring Cost to be Assessed and Ordering Preparation of Proposed Assessment 2. Resolution No. 14913 - Resolution for Hearing on Proposed Assessment (h) Claims, Appropriations and Contract Payments Items 7(a), 7(e), 7(0 and 7(g) were pulled for separate discussion. Motion by Czmowski, second by Christensen, to approve consent agenda with the exception of the items noted above. Motion carried unanimously. 2 CITY COUNCIL MINUTES JUNE 26, 2018 Item 7(a) had further discussion. Council Member Lofdahl noted that the Chamber of Commerce is applying to host the Minnesota Governor's Pheasant Hunting Opener in 2019. Staff is proposing to submit a letter of support of the event as part of the Chamber's application process. Motion by Lofdahl, second by Forcier, to approve Item 7(a). Motion carried unanimously. 7(e) had further discussion. Kent Exner noted that Letting No. 2, Project 18-02, had originally included a change order but instead it needs to be indicated as a work order per MnDOT's request. No other information has changed. Motion by Cook, second by Christensen, to approve Item 7(e) as revised. Motion carried unanimously. Item 7(f) had further discussion. Kent Exner noted that the bid opening for Century Avenue improvements was held last Friday. A revised Resolution is before the Council with the bid amount included from the low bidder, R&R Excavating. Motion by Cook, second by Lofdahl, to approve Item 7(f) with revised Resolution 14910 and Resolution 14911. Motion carried unanimously. Item 7(g) had further discussion. Kent Exner noted that Resolution 14912 was revised to include the low bid amount from Wm. Mueller and Sons. The alternate bid needs to be analyzed and discussed with the Resource Allocation Committee and will be considered at a future Council meeting. The assessment roll was also revised after reconsideration of how rates are arrived at for full reconstruction projects. Mr. Exner is proposing to use a street cost rate of $58.50/front foot. Bonding dollars will most likely make up the difference from the decrease in the rate as originally proposed. Motion by Cook, second by Lofdahl, to approve Item 7(g) with revised Resolution No. 14912 and Resolution 14913. Motion carried unanimously. PUBLIC HEARINGS — 6:00 P.M. 8. APPROVE/DENY ADOPTION OF UPDATED BUSINESS SUBSIDY CRITERIA Miles Seppelt, EDA Director, introduced EDA Intern, Meagan Donahue. Ms. Donahue explained the public purpose of a business subsidy which is a benefit given to a business or qualified recipient by the state or local government and can come in many forms such as grants, loans or property/infrastructure. The purpose is to enhance the economic diversity of the city, create high quality job growth, provide for job retention, stabilize the community and increase the tax base. Hutchinson first adopted a business subsidy policy in 2003 and any time revisions are made to it, a public hearing must be held. Ms. Donahue explained the proposed revisions to the policy which includes removing JOBZ language due to the program expiring, simplifying base wage language as it will be adjusted annually when the US Department of Health and Human Services updates their poverty guidelines and changing the ratio of jobs created per amount of assistance provided to one job per $100,000 which increases flexibility. Ms. Donahue shared outcomes of local companies that were provided business subsidies. Motion by Lofdahl, second by Christensen, to close public hearing. Motion carried unanimously. Motion by Cook, second by Christensen, to adopt updated business subsidy criteria policy. Council Member Cook asked Mr. Seppelt the return on investment with business subsidy. Mr. Seppelt noted he does not have the exact number at hand but it is extremely advantageous. Motion carried unanimously. CITY COUNCIL MINUTES JUNE 26, 2018 9. CONSIDERATION OF COMMENTS AND INPUT ON THE STORM WATER POLLUTION PREVENTION PLAN FOR THE CITY OF HUTCHINSON John Paulson, Environmental Manager, presented before the Council. Mr. Paulson provided a presentation on the City's Storm Water Pollution Prevention Plan Annual Report for 2017. This is a requirement of the MPCA who administers the National Pollution Discharge Elimination System Phase II permit. Mr. Paulson presented on the City's MS4 storm water program and 2017 activities that were performed. Motion by Lofdahl, second by Czmowski, to close public hearing. Motion carried unanimously. Council Member Cook thanked the public for helping the City keeping an eye out for issues and reporting them to staff. COMMUNICATIONS, REQUESTS AND PETITIONS (The purpose of this portion of the agenda is to provide the Council with information necessary to craft wise policy. Includes items like monthly or annual reports and communications from other entities.) 10. REVIEW OF ANNUAL CITY ENERGY CONSUMPTION REPORT John Paulson, Environmental Manager, presented before the Council. Mr. Paulson provided a brief overview of the 2016 energy usage data summary relative to specific City departments and ongoing energy conservation efforts. The departments included wastewater, water, public works, emergency services, parks, building, compost, and Liquor Hutch. The information contained usage of electric use and natural gas use from 2013-2017. The total savings from 2010-2017 is $1,815,340.41. Overall, the City's usage is down 17.56%. UNFINISHED BUSINESS 11. APPROVE/DENY ORDINANCE NO. 18-783 - ORDINANCE REVISING CHAPTER 90 OF HUTCHINSON CITY CODE — RIGHT OF WAY (SECOND READING AND ADOPTION) John Paulson, Environmental Manager, presented before the Council. Mr. Paulson noted that two revisions have been made since the first reading. The change was made to the definitions section by removing "hole" and "trench". It was determined that these definitions are not necessary since they were only defined for reference and are not used anywhere in Chapter 90. Council Member Cook suggested that perhaps the ordinance be reviewed in the future for opportunities to tweak it a bit more in other areas since the changes at the forefront were geared towards small cell technologies. Motion by Cook, second by Christensen, to approve second reading and adoption of Ordinance No. 18-783. Motion carried unanimously. Motion by Lofdahl, second by Forcier, to approve summary ordinance No. 18-783. Motion carried unanimously. City Attorney Marc Sebora explained the majority vote necessity for approval of the summary ordinance, which is required by state law when publishing a summary ordinance. 12. APPROVE/DENY ORDINANCE NO. 18-784 - ORDINANCE REVISIONS CHAPTER 154.119 OF HUTCHINSON CITY CODE — TELECOMMUNICATIONS (SECOND READING AND ADOPTION) John Paulson, Environmental Manager, presented before the Council. Mr. Paulson explained that 11 CITY COUNCIL MINUTES JUNE 26, 2018 since the first reading of this ordinance one revision has been made to Section (U)(1)A.6 by removing C-3, Central Commercial District and moving it to (U)(1)A.7. This change will require small cell development in this district to obtain a conditional use permit. Matt Jaunich also suggested that on page 6, 132C, add the word "existing" before "grade". Page 9, (F) Tower Locations, the last sentence is not needed as nothing falls within that definition and staff is proposing to strike that sentence. Motion by Lofdahl, second by Czmowski, to approve second reading and adoption of Ordinance No. 18-784 with the revisions noted. Motion carried unanimously. Council Member Cook referenced the requirement for conditional use permits for the downtown district. He asked if the City will ever really want towers in the downtown district. Mr. Paulson explained that there is specific language in the code that determines the height of the tower and the height of the building to ensure that they will be out of sight. Motion by Lofdahl, second by Cook, to approve summary ordinance No. 18-784. Motion carried unanimously. NEW BUSINESS 13. APPROVE/DENY AMERESCO PROJECT DEVELOPMENT AGREEMENT John Paulson, Environmental Manager, introduced John Neville and Dawn LaSota of Ameresco. Mr. Neville explained that Ameresco provided a comprehensive overview of the assessment and the potential for a significant reduction in energy consumption. Energy conservation measures and facility improvements include the following: LED street light replacements, WWTF scour and aeration blower efficiency, interior and exterior facility lighting and ball field lighting. Ms. LaSota explained that the City's total energy cost is approximately $1 million. Street lights, water treatment plant and the wastewater treatment facility have the highest utility costs. Ameresco is proposing a self -funding project. The benefits include: City infrastructure improvements using energy conservation measures; energy cost savings pays for entire project; self -funding from cost savings; repurposes utility budget dollars to fund improvements, upgrade equipment/systems which are inefficient or beyond service life; and reduces future operations and maintenance costs. The estimated project cost is $3-$3.5 million. The estimated annual energy and O&M cost savings is $165,000- $190,000 with one-time utility rebates estimate of $50,000. This project will see approximately 20% in annual city energy costs saved. Ms. LaSota spoke of street lighting solutions by using LED street lights, upgrading with fiberglass poles and fixtures. Ameresco is also recommending field lighting solutions by replacing HID field lighting with LED fixtures and retaining the existing poles. Ameresco is recommending interior and exterior facility lighting improvements which will include retrofit interior/exterior lighting florescent and HID fixtures with LED technology, retrofit/replace HID park lighting, install vending machine controls to turn off light based on occupancy, increase use of controls and sensors to optimize operations and optimize light levels. Lastly, Ameresco is recommending wastewater treatment plant aeration blower replacement by replacing blower units with energy efficient units, upgrading SCADA as necessary for monitoring and control and investigating use of scour blower connection for more turn -down and redundancy. The proposal is to approve a project development agreement to develop a self -funding energy saving project. Those details include Ameresco completing a detailed analysis to identify a self -funding project or there is no cost to the City. In the event the City Council does not move forward with a viable self -funding project, an "exit fee" of $35,000 would be invoiced. The deliverables in the project would include scope of work, energy and operations and maintenance costs savings, cash flow and funding options 5 CITY COUNCIL MINUTES JUNE 26, 2018 which would be a self -funding project scope with additional city capital additions. Infrastructure planning dollars or facility dollars could be used for costs associated with this project. Motion by Lofdahl, second by Christensen, to approve Ameresco project development agreement. Motion carried unanimously. 14. APPROVE/DENY ORDINANCE NO. 18-788 - AN ORDINANCE SUSPENDING ENFORCEMENT OF HUTCHINSON CITY ORDINANCE 92.018 PERTAINING TO HOURS OF CONSTRUCTION DURING THE 2ND AVENUE SE BRIDGE REPLACEMENT PROJECT (WAIVE FIRST READING, SET SECOND READING AND ADOPTION FOR JULY 10, 2018) Kent Exner, City Engineer, explained that staff recently received a request from the general contractor for the City's 2nd Avenue Bridge Replacement project to revise the City's noise ordinance requirements (6:00 a.m. start time to 10:00 p.m. end time allowed) relative to all days this summer. This project is scheduled to be completed by August 24, 2018. The extended working hours will hopefully ensure that the city specified construction completion date is satisfied by the contractor. The unfavorable spring weather and high water levels has caused some delays with the project. Motion by Czmowski, second by Cook, to approve waiving first reading and setting second reading and adoption of Ordinance No. 18-788 for July 10, 2018. Motion carried unanimously. 15. APPROVE/DENY INVOCATION POLICY Matt Jaunich noted that after discussions from the last Council meeting, an invocation policy is before the Council to consider. This policy does not eliminate the invocation, but rather sets a policy in establishment of the invocation. Much of the language was taken from Supreme Court rulings. One section was removed from the original policy presented at the last meeting and therefore some sections referenced will need to be corrected. Motion by Czmowski, second by Cook, to approve invocation policy with the revisions noted. Motion carried unanimously. 16. APPROVE/DENY SETTING COUNCIL WORKSHOP FOR JULY 10, 2018, AT 4:00 P.M. TO DISCUSS USE OF HOSPITAL MONEY Matt Jaunich noted that during the budget kickoff workshop staff and Council discussed holding a workshop to further discuss use of the hospital money from the hospital lease buyout. Motion by Lofdahl, second by Forcier, to set Council workshop for July 10, 2018, at 4:00 p.m. Motion carried unanimously. 17. APPROVE/DENY SETTING COUNCIL WORKSHOP FOR JULY 24, 2018, AT 4:30 P.M. TO REVIEW 2017 AUDITED FINANCIAL REPORT Motion by Czmowski, second by Christensen, to set Council workshop for July 24, 2018, at 4:30 p.m. Motion carried unanimously. 18. APPROVE/DENY LEASE AMENDMENT WITH TNT AIR, LLC Marc Sebora, City Attorney, explained that a lease agreement was entered into last year with TNT Air, LLC for leasing of real estate at the Hutchinson Airport so that TNT Air, LLC, could construct a hangar at the airport. As part of the construction of the hangar, TNT Air, LLC, obtained CITY COUNCIL MINUTES JUNE 26, 2018 construction financing through Citizens Bank and Trust. The permanent financing is going to be made via an SBA loan through the Prairieland Economic Development Corporation in Slayton, Minnesota. In order to finalize the transaction to obtain the SBA loan, the SBA requires that the City's lease with TNT Air, LLC be modified to protect the SBA's investment in the financing of the hangar. Those modifications center around giving the Prairieland Economic Development Corporation or the SBA the ability to re -rent the hangar to a new tenant should TNT Air, LLC, default on its obligations to the Prairieland Economic Development Corporation or the SBA. Mr. Sebora noted that the lease amendment protects the City's interests in making sure that any tenant taking over for TNT Air, LLC, would have to comply with the City's land use and zoning ordinances, continue to maintain adequate insurance to protect the City and to continue making payments to the City for the real estate. Motion by Czmowski, second by Lofdahl, to approve lease amendment with TNT Air, LLC. Council Member Cook noted that the original lease allows for the City to increase rent periodically. That does not change with the lease amendment. Motion carried unanimously. GOVERNANCE (The purpose of this portion of the agenda is to deal with organizational development issues, including policies, performances, and other matters that manage the logistics of the organization. May include monitoring reports, policy development and governance process items.) 18. MINUTES/REPORTS FROM COMMITTEES, BOARDS OR COMMISSIONS a) Public Arts Commission Minutes from May 10, 2018 b) Hutchinson Housing & Redevelopment Authority Board Minutes from May 15, 2018 (c) City of Hutchinson Financial Report and Investment Report for May 2018 (d) Tall/Grass/Noxious Weed Monthly Report for May 2018 MISCELLANEOUS 19. STAFF UPDATES Kent Exner — Mr. Exner noted that the Hwy 15/1\4ain Street Open House is scheduled for June 28"' from 4:30-6:30 p.m. at Event Center; Century Avenue reconstruction project — special meeting on July 2na may or may not be needed for this project due to approvals needed by Mn/DOT first. The special meeting will still be held as other items need to be considered (Elks Park donation, HUC rates) Matt Jaunich — Mr. Jaunich spoke about the LMC Conference; He noted the joint meeting with HUC at 3:45 p.m. tomorrow, June 27 h; He reminded the Council of the special meeting on July 2 at 8:00 a.m.; Offices will be closed on July 4, 2018, and the Council packet will be going out on July 3 for the July 10 meeting so the deadline for items for that packet are by the end of the day on July 2; Registration is open for the CGMC Annual Conference 20. COUNCIL/MAYOR UPDATE Steve Cook — Council Member Cook noted there three very brown trees in Oakland Cemetery that he asked staff to check on, along with a pine tree. Council Member Cook noted that he was approached by someone at a conference about ranked -choice balloting (all candidates are on ballot, no primary, voters rank the candidates — advantage is winner would have more than 50% of the votes). Cook suggested the Charter Commission discuss this item when they meet to discuss HUC members living outside city limits. Cook noted that a spokesperson would attend a Charter Commission meeting to review ranked choice voting. The Council agreed this topic could be explored. Mary Christensen — Council Member Christensen asked when grass is going to be placed in the 7 CITY COUNCIL MINUTES JUNE 26, 2018 boulevards along the new trail along School Road/Roberts Road. Mr. Exner noted that that is being addressed with the contractor and hopefully will be taken care of in August. John Lofdahl — Council Member Lofdahl spoke about sessions he attended at the LMC Conference and that the City had received another award in the Green Step program. Gary Forcier — Mayor Forcier noted that Matt Cheney, owner of Red Line Systems, Inc. has shown interest in serving on the HUC Board. Mr. Cheney has spoken with HUC Commissioners and General Manager Jeremy Carter. Mayor Forcier noted that he intends to add him to the next Council agenda for appointment. ADJOURNMENT Motion by Czmowski, second by Lofdahl, to adjourn at 8:10 p.m. Motion carried unanimously. ATTEST: Gary T. Forcier Mayor Matthew Jaunich City Administrator