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1987-11-16 CC Minutes w . . . ... .. COUNCIL MINUTES NOVEMBER 16, 1987 .. The regular meeting of the AlbertvIlle CIty CouncIl was called to order by Mayor Loretta Roden. Members present Included Gary SchwenzfeIer, Donatus Vetsch, Don CornelIus and Bob Braun. Others present Included Maureen Andrews and Bob MIller. There was a motIon made by Bob Braun and seconded by Don CornelIus approving the agenda. All were In favor and the motIon carrIed. The mInutes were approved on a motIon made by Don CornelIus and a second by Donatus Vetsch wIth all members votIng In favor. Mr. Arlun MIddleton of St. MIchael Insurance was present to reVIew WIth the Council the 1988 Insurance package. Arlun pOInted out that though there had not been any major changes made In the total package coverage the premIum rate de- creased by $1,451.00 with the only Increase showing up In the lIabIlIty catagory. The CouncIl next dIscussed Public OffIcials coverage. The LMCIT quoted a premIum cost of $675.00 for PUBlic OffIcIals, WhICh does not Include PrIor Acts coverage. Tudor, our current carrIer, had agaIn offered a quote of $2,600.00 WhICh IS the same premIum as for 1987. DIScussIon focused on what would be the best alternatIve for the CIty. Issues pOInted out Included: That by gOIng WIth the Leaque's coverage there was greater potentIal for exposure without prIor acts coverage. That because of the InstabIlIty of the insurance market there IS no quarantee that Tudor Insurance wIll be avaIlable. That Tudor Insurance, beIng a surplus lInes Insurance In MInnesota, they are not subject to the Minnesota Guarantee fund In case of bankruptcy. , If the CIty would purchase coverage from both the Leaque of MInnesota CItIes and Tudor for a couple of years the CIty would be protected by the prIor acts coverage already provided for by Tudor whIle at the same tIme be establIshIng prIor acts coverage for the League. Gary Schwenzfeler asked what was the possIbIlIty of beIng sued and Bob MIller saId he would have to look at the dIfferent statutes of lImItatIons regardIng council's actIon. COUNCIL MINUTES PAGE 2 . Bob agreed wlth Arlun Mlddleton that the Leaque's Coverage wlll prove a beneflt a couple years down the road when the more expenslve coverage can be dropped, Just ln the money that wlll be saved by League's lower premlum. Bob also pOlnted out that the Clty's greatest exposure ln a publlC offlClals clalm lS the cost of defending the case and ln that case lt lS very lmportant to have prlor acts coverage. Arlun pOlnted out that Albertvllle has the luxury of havlng two pollcles to choose from when many citles donlt, but that that could change at any tlme and the Clty could be faced wlth the Leaque coverage wlth no prlor acts coverage. When asked, the Cltj Attorney agreed with Arlan Mlddleton that It'S the most appropriate time to double insure the publlC offlClals so as to establlsh some prlor acts coverage. Reason for thls recommendatlon was already establlshed ln earller dlScusslon but included. 1) Decreasing the amount of exposure from the Leaques coverage lf the C1ty was faced with a withdrewl of Tudor coverage. 2) Instablllty of the insurance market and the fact that Tudor 1S not subject ot the Minnesota Guarantee fund ln the case of bankruptcy. . 3) The Clty would be establ1shing prlor acts coverage through the league at a time when money was budgeted for a 5% increase across the board for lnsurance coverage. Wlth no other d1Scusslon a motlon was made to approve the coverage of all lnsurance, 1nclud1ng Tudor's PubllC Off1C1al's based on recommendatlon of the City Attorney and the Clty Insurance Agent. The motion was made by Gary Schwenzfe1er and seconded by Don Cornelius. All were in favor and the motlon carrled. Don Cornellus asked lf the snow blower had been covered and was told that Arlun was aware that it had purchased and was waItIng for model and serlal numbers. No actIon was needed for the dIScussIon. Mr. LeRoy BernIng was present as a representative of the AlbertvIlle Area Jaycees to request that they be allowed to Install a culvert In the dralnage ditch that runs between Hordls Bros. Glas and Truss Mfg. The purpose of thIS Installation IS so taht the snowmobIle trail can be completed through town. . The snowmobIle traIl has been proposed to come across the Becker property to the west lnto the Co. Rd. 37 road ditch along the old 152 rlght of way then soutr through the IndustrIal park, WhICh IS why the culvert and partlcal fIllIng of the dItch IS needed to as to get across the open dItch area. The Jaycees are lookIng to fIll between 12 to 16 feet across so that the traIl can be properly groomed. The CouncIl was Informed that Thore was aware of the request and thought COUNCIL MINUTES PAGE 3 there would be no problems as long as the work was done properly. . LeRoy next requested that the Jaycees be allowed to remove part of the barrlcade at the end of 60th Street for establishlng the trail. It is the understandlng of the Jaycees that they would be responsible for having the barrlcade removed and relnstalled in the Spring. LeRoy dld not have any problems wIth that conditlon. There was no other dlScusslon regarding the snowrnJblle trall other than the Council stating that they had no objections to the proposal as long as everythlng was complete as agreed to. The Jaycees also requested a limlted 3.2 Beer Llcense for the Dance to be held on November 20, 1987. A motlon was made by don cornelius and a second by Bob Braun approvlng the llcense. All were in favor and the motlon carrled. The r~xt lssue dlscussed by the Councll was the bond sale for the $250,000.00 Temporary Improvement Bond S9le. Mr. Jerry Shannon of Spr1ngstead was present to review wlth the Counc1l the result of the bond sale. . At 1:00 p.m. Sprlngstead opened 5 bids at their offlce (see attached llst) with the lowest net lnterest cost and rate comlng form the Moore, Juran and Compamy, Inc. at $47,250.00 and a net lnterest rate of 6.3000%. Jerry next revlewed wlth the Council why a Temporary Imprjve- ment Bond was used lnstead of a definitive bona. Reasons included the Barthel's past hlstory of pre paYlng assessments and then havlng the walt for a call date on a def1nltlve bond. Another reason for gOlng with a temporary bond was that the city would get a better lnterest rate compared to the deflnltive bond. Other ltems dlscussed lncluded the City's need to set up a speclal account for the bond proceeds (thls 1S Just an accountlng transact1on) which is broken down by constructlon and debt retlrement on a per project basls. In addltions assessment payments can then be pald back aga1nst that account. The Councll was also lnformed that only interest payments would be made on the bond until the final payment was made WhlCh would be the prlnc1pal payment. . Flnally It was pOlnted out that with a temporary bond that Clty would have several optlons of reflnance If at the end of the bond 1t had not all been prepaid. Flrst the City can reflnance another Temporary bond not to exceed 3 years. Secondly the Clty could reflnance w1th a deflnltlve bond, and 1n Albertvllle'e case the bond would llkely be extended out 12 years. Finally In the case that another short term bond was 1ssued and at the end of its llfe there was stlll COUNCIL MINUTES PAGE 4 . money owning it could be refinanced the thIrd time but only wIth a definitIve bond. A point noted on the third option is the cost Invvolved with refinanccing bonds could be reduced by going dIrectly to a definitive bond. Other discussion about the bond issue included why capItalized Interest was part of the Issue, and how the project should be assessed for the bond cost. The reason capItalIzed interested was included as part of the interest cost IS because the City WIll not be assessing until 1988 makIng the assessments due and payable in 1989 while payments will need to be made prior to 1989. The capitalized interest assures the city that there IS enough money to cover payments that need to be] made prIor to the first county settlement sheet In 1989. It is SprIngstead's recommendation that at the tIme of assessment hearIng the CIty set the interest rate at 1.5% above what a defInItIve bond would have gotten for a rate. In the case of thIS Issue a definItive bond would have come In at 7,28% WhICh when Increased by 1,5% the assessment rate should be set at 8.78% (or8..5% for better calculatIng purposes). The reason for establIshing the assessments Intecest rate over and above the rate of the definitive bond serves as protection to the City in the case that an addItIonal bond would have to be Issued, and secondly with an unstable bond and stock market the CIty can not be assured of where the 1nterest rates WIll be in three years. . Jerry Shannon pOInted out that because of d1fference between the fIrst four bIds and the bid from American NatIonal Bank of St. Paul that it was a courteousy bid so that the City would bkow that they were aware of the sale and their past Interest 1n Albertville bonds. Jerry also pOInted out that Amer1can National has served as paying agent on other issues and that It would not be unvommon for them to do It on an Issue such as thIs one. There was no other dIScussion so the followIng mot1ons were made: A motion was made by Gary Schwenzfeier and seconded by Donatus Vetsch appo1nt1ng American National Bank of St. Paul as the paYIng agent for $~50,000.00 G.O. $emporary Improvement Bonds, SerIes 1987A. All were In favor and the motIon carried. A motIon was made by Don Cornel1us and seconded by Bob Braun Wh1Ch approved Resolut1on 1987-7 ent1tled a RESOLUTION AUTHOR- IZING AND AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS COVENANTS AND DIRECTIONS FOR $250,000.00 GENERAL OBLIGATION TEMPORARY IMPROVEMENT BONDS, SERIES 1987A. All were In favor and the mot1on carrIed. . Jerry Shannon too thanked the CouncIl for allowIng Springstead to work on the bond sale. The next Item discussed by the CouncIl was the Income Received and BIlls To Be PaId. Gary Schwenzfeler questIoned the AT&T bill for the new telephone. Maureen stated that It was her understanding that in order to make the phone change that a sIngle line phone would be purjPased for the MaIntenance COUNCIL MINUTES PAGE 5 . department and that the two line phone that IS In the back would be moved to the front and Installed at LorI Roden's desk. Because of the need to call a publIC hearing to order this d1SCUSSlon was continued. A mot1on to call the public hearing on the Establ1shment of a system for Organized Collection of Solid Waste was made by Donatus Vetsch and seconded by Don Cornel1US. All were 1n favor and the hearing was opened. (see slgn 1n sheet that 1S attached) It was stated that the purpose of the meet1ng was to get Information from those present so that the Counc11 could start the process needed to be completed before any organIzed haulIng could begin in Albertville. the Counc11 was asked why there was interest In organIzed haul1ng and what was being planned. The answer gIven was that the City was looking at garbage hauling on a contract basis 1n order to reduce the damage to the C1t1es Road beds. The CouncIl also stated aht no decision has been made on how serV1ce would be set up. Kurt Correw asked If the CIty was looking for Just one hauler or Just OTIEhaul day. Again the Council stressed that none of those Issues have been decIded. . The haulers all agreed aht they have alot to lose If the City goes to a one hauler system but stated taht they would be w1lllng to work toward a solution that was good for everyone. Other items d1scussed included establishIng an ord1nance requ1rlng that all haulIng be done on one day, that the City could require licensIng of all haulers or the possIbilIty of Spl1ttlng the C1ty into sections w1th each hauler beIng respons1ble for one area. the CouncIl asked how other Cities that are dIvId1ng up serV1ce areas are dOIng it. Kurt Correw said that 1n Champlin they are divIdIng it up on the same percentage of homes as th3ey hauled when each resIdent was responsible for contracting their own hauler. Gary SchwenzfeIer stated that as a CouncIl member he would lIke to see everyone that is currently hauling in town have an opportun1ty to be Involved int he process and 1n the haulIng 1f the Counc11 makes any changes. Kurt Correw said that Chuck Cutter of Mpls. may be a good resource person for the City to talk to regarding hauler's consortiums and would likely come out and speak w1th the Counc11. . Don CornelIus agreed wIth Gary Schwenzfeier's earl1er statement that the CIty is not lookIng to put anyone out of bus1ness. COUNCIL MINUTES PAGE 6 . WIth no other dIScussIon the Mayor accepted a motion to close the hearIng. The motion was made by Gary Schwenzfeler and seconded by Don Cornelius. All were in favor and the motion carried. A motIon was then made by Don Cornelius WhICh was then seconded by Donatus Vetsch approving RESOLUTION 1987-8, entItled A RESOLUTION OF INTENT TO ESTABLISH A SYSTEM OF ORGANIZED OOLLECTION OF SOLID WASTE. All were in favor and the motion carrIed. It was suggested that Maureen try to get Chuck Cutter and Marllynne Corcoran scheduled for the next meeting of the CouncIl to dISCUSS the City of Champlin's and the organIzed haulers experiences have been to date. After that the CouncIl wIll set up a commIttee to study the issues. The CouncIl went back to the discussion on the bIlls continued It was agreed that If the Rotary phone presently located at LorI's desk could be used In the back the new single line would be put 1n the back. W1th no other dlScuss10n there was a motion made to approve the b1lls. The mot1on was made by Don CornelIus and seconded by Bob Braun. All were in favor and checks ~~it through ~31~ were approved. . Maureen next 1nformed the CouncIl that recyclIng would begIn 1n Albertv1lle on December 16th and would take place every 3rd Wednesday at the locatIon of the RailRoad cross1ng. Irma Vetsch WIll put It in the newspaper In "AlbertvIlle News". It was p01nted out that East Tonka garbage haulers are gOIng down 51st on a regular basis. Maureen was asked to check on it to see 1f theyare Just servicln the bUSInesses In the Industr1al Park and if so, inform them that they should be ius1ng Barthel INdustrial DrIve. Bob M1ller next reviewed wIth the Council h1S findIngs wIth KeIth Frankl1n's request to obtain to 6 bUlld1ng perm1ts for bU1ld boards along 1-94. It 1S Bob's opin1on that neIther the law or the Coity ordInance allows for this type of request because 1t IS denY1ng the r1ghts of others. Bob also stated that there must be a sIgn installed after the appreve of the CouncIl. the CouncIl was informed that PERA was offerIng LIfe Insurance coverage for PERA members through pay roll deductIon. The Counc11 saId that if the eligible imployees were Interested in the plan that they could go ahead and have It deducted from theIr paycheck. (must be PERA members). . Vandal1sm problems dIscussed included problems at the Wastewater Plant and the four wheeling that is takin place out in Psyk's 4th AdditIon. The Council was informed that someone had been charged on teh latest damage done to the ponds earl1er In teh day. Don CornelIus pOInted out his concern regarding the damage to the road bed that is beIng done In Psyk's COUNCIL MINUTES PAGE 7 4th Addit1on. Don asked Maureen to check on a llght at the west end of the Addition. . The Counc11 was 1nformed that there would be another meeting on tHe Bern1ng M1II 1ssue , 1t will be held December 3rd at 7:00 p.m. at the St. Michael City Hall. The Counc11 gave Ken the go ahead on the removal of the old D1sposal Plant. It was agreed that teh plant bU1ld1ng needs to be removed and that it should be done as soon as poss1ble as long as the cost is reasonable. Ken L1ndsay had requested taht eh Council recons1der the purchase of a cab for the John Deere. He had found on and felt 1t was a good buy, Don Cornelius disagreed. D1Sucsslon cont1nued on the issue and the Council agreed that they had already decided that no cab would be purchased and that eh Ma1ntenance Department could bUlld one. The Counc11 next d1scussed the bladlng of 62nd Street and MacIver Avenue. Otsego Township is currently charg1ng the C1ty $75.00 an hour and will blading the road as_often as the City wants 1t done. It was p01nted out that the road 1S 1n good shape now. No act10n was taken on the matter. . Street 11ghts were approved for the middle of the block on Large Avenue (between 56th and 57th Street), at the 1ntersection of Co. Rd. 19 and 37 and for the west end of Psyk's 4th Addit1on. Maureen should contact NSP to get 11ghts ordered. Mr. Pat Meyer, Mr. Ken Barthel and Mr. John Gr1es, were present to d1SCUSS Tax Increment Financing for ht Meyer Ph1ll1P'S 66 proJect. as discussed in earlier meet1ngs. At one p01nt 1t appeared that the C1ty had some $93,000.00 1n non-comm1tted T.I.F. money but after rev1ew1ng the fund, $68,000.00 had been committed to pay on spec1al assessment on Barthel Industr1al Drive. According to John Gr1es, the attorney for Mr. Meyer, had informed the City that they were 1nterested in more than $25,000.00 in tax 1ncrement. Because the project meeded more then the $25,000.00, 1t was the feel1ng of the counc11 that more 1nformat1on needed to be prov1ded before a dec1slon could be made on whether or tax 1ncrement should be glven to the proJect. facts presented to the Counc1l 1ncluded: * The project proposed 1S a conven1ence store and gas statIon of the f1rst class. The stat10n w1ll be aff1lIated wIth the Ph1ll1P'S 66 chaln of atat1ons. * Ph1ll1pS 1S back1ng the proJect, but 1S not puttIng any cap1tal 1nto the proJect. . * The developers are hav1ng problems putt1ng the f1nancIal package together and are request1ng ass1stance 1n the form of tax 1ncrement. COUNCIL MINUTES PAGE 8 . * The developers presented the Counc11 w1th a cost breakdown of the proJect (attached to the off1cal m1nutes). The costs presented represent the entlre cost of the proJect but not all tnese cost the work towards the tax 1ncrement flnanclng. * The developer IS looklng for between $75,000.00 to $90,000.00 In tax Increment f1nanc1ng. DIScuss10n forcused on the plans and the proposal. There was also some d1Csusslon on Ken Barthel's proposal for an attached proJect on the adJoln1ng property and wherther or not tax Increment would be requested 1f In fact the proJect becomes a rea11ty. The 1ssued ralsed regardlng thlS proposal IS the amount assessed agalnst property that has been classlfled as wetlands and w1l1 not be developed and the amount of money owed 1n back taxes on the property. Because thls Issue dld not dlrectly relate to the Issue at hand It w11l be dlscussed at a later date. It was dec1ded by the Councll that the proJect was acceptable to be cons1dered for tax 1ncrement flnanclng provlded that the bond attorney has an opportunIty to reVIew the proJect. Before any work proceeds the C1ty has requested a deposlt of $1,000.00 ro cover any pre11m1nary expenses. . There was no other dlScusslon so a mot10n was made to set a pub11c hear1ng on the tax Increment flnanclng proposal for Pat Meyer's PhllllpS 66 Stat10n at the earllest date posslble, pendIng Holmes and Graven's reV1ew of the proJect. The motlon was made by Donatus Vetsch and seconded by Gary Schwenzfe1er. All were In favor and the motlon carrled. The Councll voted voted to amend the JOlnt Power's Agreement so that the Agreement w111 provlde for the fallure to comply wlth regulatlons concernlng water useage, water Ilne constructlon and other matters that the Board m1ght deem necessary. The motlon to author1zed the Mayor and Clerk to slgn the amendment was made by Gary Schwenzfeler and seconded by Don Corne11us. All were 1n favor and the mot10n carr1ed. Mayor Roden 1nformed the COURCll that the JOlnt Powers Board 1S worklng on thelr 1988 budget that no actlon was taken on the Issue. The Councll d1scussed who would serve as the llaslon between I the CouncIl and the Ma1ntenance Department. Gary Schwenzfeler sald that he would be w1l11ng to do 1t. There was also some dlScusslon regardlng a backup person but It was deCIded to walt and select that person at a later date. Donatus Vetsch asked the storm sewers dralns be checked as some of them appeared to be plugged after the recent ra1ns. Gary SchwenzfeIer asked that Mark Barthel be contacted regardlng the curb restoratIon WhIch needs to be completed SInce they Installed a new drIveway. . There was some dISCUSSIon regardIng the YIeld 81gn WhICh was Installed at the Intersect10n of 56th Street and lander Avenue. Don CornelIUS asked to check to see 1f IS was lnstalled In the wrong locatIon. The Yelld s1gn at the corner of 57th and lander has been defaced yet was not replaced , . . . COUNCIL MINUTES PAGE 9 under the County s~gn program. Street s~gns that are d1ffect~ve should be replaced accord~ng to the counc1l. Ken L~ndsay 1S to go ahead and order the replacement slgns as needed. Hydrant extens10ns have been ordered and w~ll be ~nstalled when they come In. Maureen was asked to contact Me~ny about ra~s1ng the one at was recently moved at the corner of Barthel Industr~al Or1ve and Lannon Avenue. There was a mot~on made to approve bu~ld~ng perm1ts number 49-51 and permlt number 52, pend1ng payment. The mot~on was made by Gary Schwenzfeler and seconded by Oonatus Vetsch. All were 1n favor and the mot~on carrled. There was also some d~scuss~on regard~ng the request by Custom Canap1es (Perm1t I 52) allow1ng the to ~nstall a hold~ng tank Instead of a spectlc system. Maureen 1nformed the Counc~l that she had checked wlth Meyer- Rohlln was was told that ~t would be ok from an eng~neer1ng standpolnt. Thore Meyer wanted It stressed that the appl~cant should reallze that even though there 1S prellmlnary d~scuss~on regard1ng the 1nstallatlon of sewer and water on the north slde of the freeway that noth ng has been approved to date. The Counc~l sald that they d~d not see any problem w1th the holdlng tank, prov~ded that when sewer does become aval1able that they w11l need to connect to the Clty servlces. The Councl1 revlewed the des~gns subm~tted for the Clty Button. After vot1ng the deslgn submltted by Oenn~s Boese was selected and f1rst pr~ze was awarded. There was no other new bus~ness so there was a mot10n made to adJourn. The motlon was made by Don Cornellus and seconded by Bob Braun. All were 1n favor and the motlon carrled.