2007-03-13 L Kruse Transcript1
DISTRICT COURT
1 STATE OF MINNESOTA
TENTH JUDICIAL DISTRICT
2 COUNTY OF WRIGHT
3 Gold Key Development, Inc., a Minnesota corporation,
4 Plaintiff,
File
No. 86-Cv-06-2998
5 vs.
6 City of Albertville,
7 Defendant/Thi.rd Party...Pl..a.in.t.i£f,
DEPOSITION OF
8 VS.
LARRY KRUSE
9 Short Elliott Hendrickson, Inc.,
MARCH 13, 2007
10 Third Party Defendant.
a 4:
T/C Homes, Inc•, a Minnesota corporation, a.
11'�
12 Plaintiff and Cross Claimant,
File
No. 86-CV-06-4997
13 vs.
14 Gold Key Development, Inc., a Minnesota
corporation,
15 Defendant/Third Party Plaintiff,
16 vs.
17 Hedlund Engineering,
18 Third Party Defendant,
19 vs.
20 City of Albertville,
21 Defendant/Third Party Plaintiff,
22 vs.
23 Short Elliott Hendrickson, Inc.,
24 Third Party Defendant.
25
KIRBY A. KENNEDY & ASSOCIATES
(952) 922-1955
r
Larry Kruse, March 13, 2007
n
1 STATE OF MINNESOTA
DISTRICT COURT
2 COUNTY OF WRIGHT
TENTH JUDICIAL DISTRICT
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3
1 APPEARANCES (CONTINUED):
2
3 STEPHEN E. YOCH, ESQUIRE, of the Law Firm of
4 FELHABER (ARSON FENLON & VOGT, PA., 444 Cedar Street, Suite
5 2100, St. Paul, Minnesota 55101-2136, appeared for and on
6 behalf of Plaintiff and Cross Claimant TIC Homes, Inc.
7
8 ANTON J. VAN DER MERWE, ESQUIRE, of the Law Firm
9 of ARTHUR CHAPMAN KETTERING SMETAK & PIKALA, PA., 500 Young
10 Quinlan Building, 81 South Ninth Street, Minneapolis,
11 Minnesota 55402-3214. appeared for and on behalf of Third
12 Party Defendant Hedlund Engineering.
13
14 The Original is in the possession of
Attorney Cindi S. Matt.'
15
16 INDEX PAGE
17 Cross -Examination by Ms. Matt 5
18 Cross -Examination by Mr. Yoch 51
19 Continued Cross -Examination by Ms. Matt 81
20 Cross -Examination by Mr. Markert 157
21 Goss -Examination by Mr. Van der Merwe 166
22 Recross-Examination by Ms. Matt 171
23
24
25
2
1
4
LARRY KRUSE DEPOSITION EXHIBITS MARKED
1
The Deposition of CARRY KRUSE, taken pursuant to
2
Notice of Taking Deposition, taken before Randall D.
2
94 - Plat of Prairie Run Addition, 41
By Hedlund Engineering, August 2004, four pages
3
Herrala, RPR, a Notary Public in and for the County of
3
95 -Letter, To Cindi Matt and Stephen E. Yoch, 61
4
Wright, State of Minnesota, taken on the 13th day of March,
4
From Jason J. Kuboushek, Re: Gold Key
Development, Inc. V. City of Albertville v.
5
2007, at 9321 Ensign Avenue South, Bloomington, Minnesota,
5
SEH, Inc., and T/C Homes, Inc. V City of
6
commencing at approximately 9:10 a.m.
6
Albertville v. SEH, Inc., March 13, 2007:
Attached City of Albertville Council Minutes
7
Of February 5, 2007; 15 pages
7
8
96 - Letter, To Mike Couri, From Robert L. Moberg, 102
8
Re: Summary of Issues to be Resolved,
9
APPEARANCES:
November 23, 2005, CITYATTY 0154 - 0155
10
9
97 - City Council Minutes, City of Albertville, 114
11
CINDI SPENCE MATT, ESQUIRE, of the Law Firm of
10
December 19, 2005, seven pages
12
JOHNSON, CARBON, PETERSON 8 MATT, P.A., 908 Commercial
11
98 - City of Albertville's Supplemental Answers to 135
Gold Keys Interrogatories, Gold Key
13
Drive, Buffalo, Minnesota 55313, appeared for and on behalf
12
Development, Inc., vs. City of Albertville vs.
14
of Plaintiff Gold Key Development, Inc.
13
Short Elliott Hendrickson, Inc.,
December 28, 20D6, four pages
15
14
99 - Letter, To Gold Key Development, Inc., From 144
16
JASON J. KUBOUSHEK, ESQUIRE, of the Law Firm of
of Albertville, Larry Kruse, Re Revised
15
15
Figure for 100-Year Flood Elevation and the
17
VERSON REUVERS, LLC, 9321 Ensign Avenue South, Bloomington,
Highest Known Water Elevation for the Prairie
16
Run Plat, December 1, 2006, three pages
18
Minnesota 55438, appeared for and on behalf of
19
Defendant/Third Party Plaintiff City of Albertville.
17
100 - Application for General Storm -Water Permit for 147
Construction Activity, By Larry Kruse, City of
20
18
Albertville, July 22, 2004, CITY 0910 - 0942
21
JOHN A. MARKERT, ESQUIRE, of the Law Firm of
19
101 -Storm Water Pollution Prevention Plan (SWPPP), 147
NPDES General Stomrwater Permit for Construction
22
COLEMAN. HULL & VAN VLIET, PLLP, 8500 Normandale Lake
20
Activity No. MN R100001, Project 2004 Prairie Run,
23
Boulevard, Suite 2110, Minneapolis, Minnesota 55437,
21
Albertville, MN, May 12. 2004, CITY 0943 - 0951
24
appeared for and on behalf of Third Party Defendant Short
22
Y3
25
Elliott Hendrickson.
24
25
Kirby A. Kennedy & Associates 952-922-1955
1-800-545-1955 Pages 1 throuah 4 of 176
Larry Kruse, March 13, 2007
2
5
7
1
LARRY KRUSE,
1
Q. How long have you held that position?
2
the Witness in the above -entitled
2
A. Three years last November.
3
matter after having been duly sworn
3
Q. So you started that in November of 2003?
4
deposes and says as follows:
4
A. Yes.
5
5
Q. Okay. And is that an elected position, or were
6
CROSS-EXAMINATION
6
you hired for that?
7
BY MS. MATT:
7
A. Hired. Appointed.
8
Q. Mr. Kruse, my name is Cindi Matt. I represent
8
Q. And prior to your appointment, Linda Goeb was
9
Gold Key Development in this litigation. Have you ever had
9
the city administrator7
10
your deposition taken before?
10
A. That's correct.
11
A. A long time ago.
11
Q. Do you know how long she had been the city
12
Q. Okay. I'm going to go over a few ground rules
12
administrator?
13
so that we all are on the same page as to how this is going
13
A. No, I don't.
14
1 to go. The court reporter is taking down your testimony, so
14
Q. Can you tell me what your duties as city
15
if you would answer my questions verbally rather than
15
administrator are?
16
shaking your head or shrugging your shoulders so that an
16
A. Overall management of the city, carrying out
17
accurate record can be taken?
17
the council's directives, Including — we have a utility
18
A. Yes.
18
department, street department, park department, and our
19
Q. And if you don't understand or don't hear a
19
office, the city offices.
20
question, please ask me to repeat it or rephrase it, and
20
Q. So you manage all of those departments that you
21
I'll do so. If you don't ask me to repeat it or rephrase
21
indicated?
22
it, I'm going to assume that you heard it and that you
22
A. Oversee, yes. We have department heads in
23
understood it. Do you agree?
23
various departments.
24
A. Yes.
24
Q. And so would you be the supervisor of those
25
Q. And if you need a break, let me know and we'll
25
departments?
6
8
1
finish the line of questioning and you can take a break.
1
A. Yes, the department heads, yes.
2
A. Yes.
2
Q. Any other duties of yours as city
3
Q. Are you taking any medications or is there any
3
administrator?
4
reason today that you can't testify truthfully and
4
A. We have a small staff, and rry duties are very
5
accurately?
5
broad, Including human resources and just all the different
6
A. No reason.
6
aspects of a typical city.
7
Q. What have you done to prepare for this
7
Q. Of a typical city?
8
deposition, and I don't want to hear about meetings that
8
A. Yes.
9
you've had with your attorney.
9
Q. Have you been the city administrator before for
10
A. I reviewed some of the exhibits briefly.
10
cities other than Albertville?
11
Q. Okay. Reviewed what exhibits? The exhibits
11
A. Yes, I have.
12
that have been introduced in the depositions, or what are
12
Q. What cities?
13
you referring to?
13
A. City of Red Lake Falls, City of Park Rapids,
14
A. I imagine all of the exhibits, a couple
14
City of Baxter.
15
binders. Ninety -some I believe there was. And I just
15
Q. Any other cities?
16
briefly -- our attorney and I perused those briefly.
16
A. No.
17
Q. Have you done anything else to prepare for your
17
Q. How many years experience do you have being a
18
deposition?
18
city administrator?
19
A. No.
19
A. About 21.
20
Q. Have you read any deposition transcripts from
20
Q. And were your duties in the City of Red Lake
21
previous individuals' depositions in this case?
21
Falls, Park Rapids, and Baxter the same as your duties in
22
A. No.
22
the City of Albertville?
23
Q. And you are the city administrator for the City
23
A. Yes.
24
of Albertville?
24
Q. Do you report to anyone, or are you supervised
25
A. Yes.
25
by anyone?
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 5 through 8 of 176
ry Kruse, March 13, 2007
9
11
1
A. I report to the city council.
1
working with — for them. We had a new election, and
2
Q. Are you supervised by them?
2
several members came on and felt that the city was due for a
3
A. Yes, I guess you could say that
3
change and sought requests for proposals for engineering
4
Q. Anyone else that you are supervised by?
4
services.
5
A. No.
5
Q. Was there a specific reason that they felt the
6
Q. And who is the city attorney for the City of
6
city was due for a change from SEH?
7
Albertville?
7
A. You know, I can't think of a specific reason,
8
A. Michael Court.
8
no.
9
Q. And he has been for the entire time that you've
9
Q. Was there any dissatisfaction by the city with
10
been city administrator?
10
SEH's work?
11
A. Yes.
11
A. You know, i don't think there was. The new
12
Q. And do you have an understanding of what the
12
council coming on had some perceived ideas that the city was
13
city attorney's role is?
13
due for a change.
14
A. To provide legal counsel to the city.
14
Q., Was there any dissatisfaction by the city with . .
15
Q. Does Mr. Court provide any other role other
15
SEH's work?
16
than providing legal counsel to the city?
16
A. I think towards the end it became obvious that
17
A. I would say it's primarily legal counsel.
17
the new political leaders wanted a change and —
18
Q. Primarily legal counsel, but does he provide
18
Q. Mr. Kruse, was there any dissatisfaction by the
19
any other role to the city?
19
city of SEH's work?
20
A. Not that I'm aware of.
20
A. I think some of the council had some
21
Q. Who is current city engineer?
21
dissatisfaction, yes.
22
A. Mark Kasma'
22
Q. Okay. Who? Particular council members?
23
Q. And he is with Bolton & Menk?
23
A. I would say, you know, probably obviously the
24
A. Yes.
24
majority because they decided to seek a different
25
Q. And how long has Bolton & Menk been city
25
engineering service, but as with all projects, you encounter
10
12
1
engineer?
1
some difficulties, and I think that they just felt that, you
2
A. I don't know exactly, but a couple years now,1
2
know, the cumulative effect of projects over time, so, yes,
3
suppose.
3
they sought a different engineer.
4
Q. Okay. And prior to Bolton Menk, who was city
4
Q. In what respect were they dissatisfied with
5
engineer?
5
SEH's work? Was there a particular project?
6
A. Pete Carlson with SEH.
6
A. Well, I think at the time the city engineer,
7
Q. And does it sound roughly right to you that SEH
7
Pete Carlson, had suffered the loss of his son, and things
8
would have been city engineer from January'95 through
8
were happening very rapidly in Albertville. I think
9
January'05?
9
Mr. Carlson was probably reevaluating where he was going in
10
A. One more time, the question?
10
his life and Robert Moberg was stepping in to take over some
11
Q. I'm wondering if it sounds right to you that
11
of his duties. That was probably the biggest thing is that
12
SEH would have been the city engineer from January'95
12
the council never — never gained the confidence in Bob
13
through January'05.
13
Moberg, and thus I think that probably was the main reason.
14
A. Yes.
14
Q. Was there a particular project that the city
15
Q. And then after January'05, SEH was finishing
15
was dissatisfied with SEH's work on?
16
up some projects, kind of random projects for the city.
16
A. At the time, you know, I don't — I'm trying to
17
Does that sound accurate?
17
think — probably experiencing some flooding problems in the
18
A. They were finishing up projects that were
18
Albert Villas Addition, but I don'tthink it was any one
19
started under their previous agreement, yes.
19
specific problem. I think it was just the transition from
20
Q. Under your previous agreement as city engineer?
20
Pete Carlson to Bob Moberg, and, you know, Bob apparently
21
A. Yes.
21
wasn't the right fit for our city council. I think maybe
22
Q. Okay. Why did SEH leave or no longer be the
22
the council thought that, you know, Pete Carlson had the
23
city engineer?
23
history with Albertville and that if we were going to break
24
A. Oftentimes when new councils come on, they want
24
in a new engineer, they wanted to pick the one that they
25
a change, and it's their discretion who they want to have
25
wanted and maybe not the one that was assigned by SEH.
Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 9 through 12 of 176
tarry (cruse, march 13, 2UU7 4
13
15
1
Q. You mentioned problems, flooding problems in
1
and what 1 can summarize is that after Pete Carlson lost his
2
Albert Villas. Was that a project that SEH had done some
2
son, some of the attention to detail appeared not to be
3
engineering work on?
3
there. Pete was transitioning a new engineer in, and at
4
A. Yes.
4
that time the council didn't take to Mr. Moberg, and that
5
Q. And the city council was dissatisfied with that
5
prompted them to pursue an engineer.
6
engineering work?
6
Q. And so at that time the council was satisfied
7
A. Well, obviously when you have flooding, you
7
with the work that SEH had done with respect to Prairie Run;
8
look at why. And so, yes, they were dissatisfied that there
8
is that right?
9
was flooding.
9
A. I think so, yeah.
10
Q. Any other projects that SEH had worked on that
10
Q. Okay. When SEH was the city engineer, SEH
11
the city was dissatisfied with other than the Albert Villas
11
wasn't an employee of the city, was it?
12
project that we just talked about?
12
A. No.
13
A. None come to mind right now.
13
Q. So it was more of an independent contractor
14
Q. Was the city dissatisfied with the work that
14
consultant?
15
SEH had done on the Prairie Run project?
15
A. They were a consultant to the city.
16
A. You know, at the time of the Prairie Run, when
16
Q. And they weren't paid a salary. They were paid
17
we — I believe when we ran into the difficulties, when we
17
on a project basis. Is that correct?
18
learned of some of the problems later on, i think the city
18
A. Right.
19
was already embarking on seeking other engineers. Up until,
19
Q. Do you have an understanding of what the city
20
you know, we learned about some of the flooding problems and
20
expects as to the duties of its city engineer?
21
some — you know, I think for the majority of the project,
21
A. Yes.
22
SEH, the council was comfortable with the work that they
22
Q. And tell me what the city expects as to the
23
did.
23
duties of the city engineer.
24
Q. When the council was seeking a new city
24
A. Well, Albertville doesn't have an engineering
25
engineer -- well, if SEH stopped being city engineer in
25
staff, so we rely heavily on our engineering firm from
14
16
1
January'05, how much before January'05 would council have
1
initial concept of a project, you know, through the ultimate
2
started seeking a new city engineer?
2
closure of that project to provide us with guidance along
3
A. You know, I guess if I could recollect the
3
the way, along with all the other engineering technical work
4
exact time that Mr. Carlson lost his son, and, you know,
4
that gets done to bring a project through all the steps.
5
some of that just kind of gets blurred together, so 1 would
5
Q. And when you say that you rely on them to
6
say it followed after Mr. Carlson lost his son.
6
provide you guidance, what do you mean?
7
Q. And at the time that the city was seeking a new
7
A. They are a hired consultant that, you know,
8
engineer, at that time the city was not dissatisfied with
8
helps us formulate projects, does preliminary feasibility
9
the work that SEH had done on Prairie Run? Is that what I'm
9
studies, analyzes whether a project is viable, makes
10
understanding you to say?
10
recommendations to the council throughout the process.
11
A. You know, I don't recall any — you know, up
11
Q. Anything else that you rely on the city
12
through the bidding and through some of the early
12
engineer to do?
13
construction, I think the majority of council was, you know,
13
A. They handle a lot of, you know, the regular
14
It was a typical project that we were doing.
14
typical duties that an in-house city engineer would do —
15
Q. And was the council satisfied with the work
15
municipal state aid, overlays, maintenance, seal coating,
16
that SEH was doing?
16
helping us put together bid packages, making sure we meet
17
A. Yes, the council was satisfied with the work
17
the intent of the law on all of our projects as far as
18
that Pete Carlson had done.
18
whether it be financing or even providing some guidance on
19
Q. With respect to Prairie Run?
19
methods to finance — or options, I should say.
20
A. Yes.
20
Q. Anything else that the city expects the city
21
Q. So at the time that the city council sought a
21
engineer to do as part of its duties?
22
new city engineer, the city council was satisfied with the
22
A. Well, I think we all expect all of our
23
work that SEH had done on the Prairie Run project. Is that
23
consultants, including the engineer, to look out for what's
24
what you're saying?
24
best for the residents and anticipate problems and make
25
A. You know, the time lines kind of meld together,
25
recommendations.
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 13 through 16 of 176
_arty Kruse, March 13, 2007
17
19
1
Q. And these things that you're talking about, I
1
attend?
2
think you said guidance and engineering technical work to
2
A. Right now they're attending the majority of the
3
bring the project through to completion. When you're saying
3
meetings. Occasionally if there isn't an engineering issue,
4
"project," are you meaning — can you give me an example of
4
they don't have to attend.
5
what types of projects you're meaning?
5
Q. What about in 2003 and 2004? Do you know
6
A. Well, we have multiple projects going on all
6
whether the city expected the city engineer to attend the
7
the time. The majority of them are developer -driven, and on
7
planning commission meetings?
8
occasion, like the Prairie Run project, the city got
8
A. I think they were on an as -needed basis.
9
involved to bring the landowners together to make the
9
Q. Okay.
10
project work.
10
A. I should say 1 don't know about 2002 and '3
11
Q. So the projects -- some of the projects would
11
because I wasn't here, but post my arrival, that's what it
12
be plats; is that correct?
12
was.
13
A. Platting.
13
Q. When you became the city administrator, was
14
Q. Okay. What else?
14
there some type of a transition meeting that you had with
15
A. Seal coat, bituminous overlays, bidding, street
15
Ms. Goeb to figure out how the City of Albertville worked
16
utility construction, water. Kind of taking a piece of
16
and what you were expected to do and so forth?
17
ground from the raw state through the development of a, you
17
A. Our employment overlapped about a month.
18
know, not only the subdivision of lots but also doing a
18
Q. So you kind of shadowed her? Is that fair?
19
review of compliance with site plans and approvals,
19
A. Yes.
20
postdevelopment of the home, so from beginning to end.
20
Q. Did you go back and read previous council
21
Q. Okay. And do you have an expectation that the
21
meeting minutes to figure out what had happened before your
22
city engineer will attend city council meetings?
22
arrival?
23
A. The city engineer attends all city council
23
A. Yes. I reviewed a lot of information during
24
meetings, and we have regular staff meetings.
24
that time.
25
Q. And the city engineer attends those as well?
25
Q. What year council minutes had you read?
18
20
1
A. Yes.
1
A. You know, I don't remember specifically, but 1
2
Q. Okay.
2
did peruse the minutes, previous minutes.
3
A. We call them staff, but they're really
3
Q. So you came in November of 2003?
4
consultant meetings. I meet with the city attorney, city
4
A. Yes. You know, I recall reading 2003. 1 know
5
engineer, and city planner.
5
1 did that.
6
Q. How often are those meetings?
6
Q. Okay. And do you — does the city expect the
7
A. Right now we meet the Tuesday after every
7
city engineer to review the engineering aspects of plat
8
council meeting.
8
submissions?
9
Q. Are there any other meetings that the city
9
A. Yes.
10
engineer typically would attend?
10
Q. All plats?
11
A. There's numerous meetings with developers and
11
A. Yes.
12
also meetings, just initial contacts with potential
12
Q. Has there ever been a plat in Albertville that
13
developers to discuss potential projects.
13
has not been reviewed by the city engineer?
14
Q. Okay. So also meetings that are specific to a
14
A. Until I recently learned that the Prairie Run
15
particular project?
15
one, other than that, the expectation that they would review
16
A. Yes. Yes.
16
all engineering work.
17
Q. Okay. Any other meetings that the city would
17
Q. And as far as you know, they did in fact review
18
expect the city engineer to attend?
18
all engineering work related to all plats in Albertville
19
A. Pretty much any aspect where engineering
19
other than Prairie Run. Correct?
20
services or technical advice is needed. It can be a parks
20
A. That would be my expectation, yeah.
21
meeting looking at various amenities in parks, planning
21
Q. And as far as you know, they did do that.
22
commission meetings, city council.
22
Correct?
23
Q. Is the city engineer expected to attend
23
A. You know, our contract 1 don't believe
24
planning commission meetings, or do you just let him know if
24
specifically states that they do a review. I react to --
25
there's going to be an engineering type issue that he should
25
our engineer provides consultation and guidance, like 1
)y A. Kennedy 8 Associates 952-922-1955 1-800-545-1955 Pages 17 through 20 of 1
Larry Kruse, March 13, 2007
6
1
21
said, from beginning to end, and as issues come forward and 1
23
Q. And let me be a little more specific. Does
2
If there is an issue, you know, they would be letting me
2
anyone from the city supervise the work of the city engineer
3
know, but they, as a part of our expectation, would be doing
3
with respect to plat review?
4
a thorough review of that.
4
A. You know, I would say that the council gives
5
Q. Are you aware of a plat in Albertville other
5
direction for the city engineer to do some work, and I am
6
than Prairie Run that has not been reviewed by the city
6
the coordinator of, you know, getting that information to
7
engineer?
7
the city council, or the conduit, you might say.
8
A. No, I'm not
8
Q. But I thought you testified earlier that the
9
Q. And does the city expect that one of the duties
9
council doesn't need to specifically direct the city
10
of the city engineer is to review grading plans submitted
10
engineer to review a plat; is that correct?
11
with the plats?
11
A. Right
12
A. Yes.
12
Q. And I thought I understood your testimony to be
13
Q. Does the city expect that one of the duties of
13
that the council doesn't direct or provide any input as to
14
the city engineer is to review drainage plans submitted for
14
the specific engineering methods that are used to review a
15
plats?
15
plat; is that correct?
16
A. Yes.
16
A. Right
17
Q. How about storm sewer plans?
17
Q. And I mean used by the city engineer. Correct?
18
A. Yes.
18
A. I don't supervise. They are a consultant of
19
Q. Do you expect that the city has to specifically
19
the city, and I am their contact at the city, and I am a
20
tell the city engineer when you get preliminary and final
20
conduit to provide that information to the council.
21
plat documents, here they are, review them now? Do you
21
Q. So whatever information the city engineer comes
22
expect that you have to specifically tell the city engineer
22
up with, they typically would give it to you and you then
23
something to that effect?
23
pass it along to the council?
24
A. No. No.
24
A. Yes.
25
Q. You would anticipate that the city engineer
25
Q. Okay. Is there anyone from the city who
22
24
1
knows that's one of his duties and would just do it?
1
actually does a check on like calculations or the specific
2
A. Knows, and that would be our expectation that
2
engineering aspects of the work that the city engineer does?
3
they provide, you know, full service.
3
A. That's the job of our city engineers to do
4
Q. Do you tell -- do you have any input into how
4
that.
5
the city engineer actually goes about and reviews the plat
5
Q. Okay. And so I just want to clarify that
6
submissions, the engineering aspects of the plat?
6
there's no one from the city that does a check on those
7
A. No. No. They're skilled professionals that do
7
engineering calculations and functions. Correct?
8
that on a regular basis, and they would be providing us
8
A. No. No.
9
guidance, or me guidance.
9
Q. Can you walk me through the process that one
10
Q. So you don't care what method they use?
10
would have to go through to get a plat considered and
11
A. No. They know better than 1.
11
approved by the city council?
12
Q. So as long as the review of the engineering
12
A. Initially we, as a development team, you might
13
aspects of the plat documents gets done, you really don't
13
say -- myself, the city planner, city engineer, city
14
care when or how it's done. Is that fair?
14
attorney — would meet in a predevelopment meeting to
15
A. As far as the technical work behind the scenes,
15
discuss the process, and that entire process would be laid
16
no, we don't see that at all.
16
out.
17
Q. And do you tell the city engineer what type of
17
Q. Can 1 just interrupt you? You meet with who?
18
reports it has to issue --
18
With the developer?
19
A. No.
19
A. Right The developer comes in and is
20
Q. -- to show that the engineering aspects of a
20
interested in developing a plat. We host a meeting and
21
plat have been reviewed?
21
provide information on all the process and fees involved and
22
A. No.
22
provide him a schedule of opportunities to bring that
23
Q. Does anyone from the city supervise the work of
23
forward through the planning commission and city council.
24
the city engineer?
24
And at that meeting, I think what you're asking for, that
25
Kirby A. Kennedy
A. ates
&Associate952-922-1955
25
long laundry list of duties or job functions, project
1
800-545 1955 Pages 21 through 24 of 176
Larry Kruse, March 13, 2007
7
1
25
functions, are outlined and given to the developer.
1
27
2
Q.
conducted a review of the grading, drainage, and other
Okay. And then so would it be fair to say that
2 engineering aspects of the plat?
3
that initial meeting is before any preliminary plat
3
A. Our expectation would be that they would be
4
documents have been submitted, kind of in the concept phase?
4
working with the developer throughout the entire
5
A. Right Right It can be at the very initial,
5
process,
reviewing, providing 9 P g guidance. And at their discretion,
6
you know, the preconcept, providing guidance and letting the
6
when they feel there are Issues, they bring those forward to
7
developer know the expectations of the city or what I, we as
7
the city council. When consultants feel they are unsure
8
staff or consultants, expect that the council would approve.
8
about issues, they bring those forward to the city council.
9
Q. And then after that initial meeting, what
9
The council then directs them
10
typically is the next step towards plat approval?
10
Q. So is there one particular point in this
11
A. The developer would submit an application.
11
process where you would expect b X
p Y pe y point, grading and
12
Q. For plat approval or preliminary plat approval?
12
drainage need to have been reviewed by the city engineer?
13
A. Sometimes It's concept, get some guidance from
13
A. Definitely, yes.
14
the council. Otherwise it would be preliminary plat
14
Q, Okay. When?
15
Q. Okay. And then what happens?
15
A. We like to have the engineer's comments
16
A. Well, if you're in a concept stage, they would
16
incorporated in the planning report usually prior to
17
share some drawings, ask for some guidance. If they were
17
preliminary plat approval. That doesn't happen on all of
18
looking at a zoning change, the council would want to see,
18
the projects. On occasion there are -- things are approved
19
you know, what probably the end users are going to be. If
19
subject to the engineer's review and
1 9 approval at a later
20
it was just something that was zoned residential in a
20
date to work out some of the details.
21
residential development, they would come in with a
21
The Prairie Run project I recall was kind of a
22
preliminary plat. That would be reviewed by our engineer,
22
unique one that the developer had done much of the
23
city planner, goes to planning commission. The planning
23
engineering, and then the only way the project really would
24
commission makes a recommendation to the city council. At
24
go forward with multiple landowners was that it had to be a
25
that time we'd look at a development agreement. Our
25
city project, and so that was a little unique I think in
1
26
engineer and consultants would be doing reviews and making
1
28
that the developer incorporated their plans into the city
2
comments.
2
plans.
3
Q. Throughout the process?
3
Q. Okay. You indicated that you typically like to
4
A. Yes. Yes.
4
have the engineer's comments incorporated in the planning
5
Q. And when you say engineering consultants, do
5
report prior to preliminary plat approval. Is that a fair
6
you mean the city planner?
6
summary of your testimony? Typically that's how you like
7
A. City planner. City planner, city engineer.
7
it?
8
And we eventually go to final plat before the city council.
8
A. That's the way it is today. I'm not sure
9
And before — I believe before the final plat would be
9
that's the way it was early on —
10
signed off on, we'd have a developer agreement that would
10
Q. Okay.
11
lay out the expectations of the developer to the city and
11
A. — in my tenure.
12
vice versa, I guess.
12
Q. Okay. Do you have something in writing? 1
13
Q. Okay. And then anything else?
13
mean, if you're incorporating comments into a planning
14
A. I mean, I quickly summarized a very extensive
14
report, does the city engineer provide you something in
15
and detailed process. In essence, yeah.
15
writing?
16
Q. And after the final plat is approved, typically
16
A. Not all the time, but a lot of times he works
17
the developer would begin development and builders would
17
with the city planner to incorporate their comments into the
18
begin building?
18
planner's document, more so todayprobably than when I first
19
A. Right
19
started.
20
Q. At what stage of this platting process that you
20
Q. What's more so today?
21
described is there a public hearing?
21
A. Incorporating p g —many times I recall more
22
A. The planning commission holds a public hearing
22
things being subject to the engineer's approval so that it
23
at the preliminary plat
23
gave, you know, a lot of the discretionary decisions on
24
Q. And is there a particular stage of this process
24
details to the engineer, things that the council probably
25
that the city would expect that the city engineer would have
25
didn't need to spend a lot of time on that were, you know,
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 25 through 28 of 176
Larry Kruse, Marcn 13, 2007 f
29
31
1
very standard in the engineering industry to work through
1
our correspondence in those files, so yes.
2
Issues.
2
Q. Do you believe that of those four or five plats
3
Q. So in your experience at the City of
3
that you have worked with each year that you've been
4
Albertville have there been any plats other than Prairie Run
4
administrator that there were any that review memorandums
5
where the city engineer did not provide like a written
5
were not prepared by a city engineer?
6
review memo type thing that would incorporate any comments
6
A. One more time with the question?
7
from the city engineer?
7
Q. I'm wondering with respect to those four or
8
A. I don't know specifically because I haven't,
8
five plats that were done each year while you were city
9
you know, tied the two together. Our engineer brings those
9
administrator, do you believe that there are any of those
10
memos forward when he feels there are Issues that need to be
10
plats that the city engineer did not prepare a review
11
communicated, and we look to their guidance on these
11
memorandum?
12
matters.
12
A. 1 don't recall any.
13
Q. So in your experience, the city engineer only
13
Q. You don't recall that the memo wasn't prepared?
14
brings those memos forward if there are problems with the
14
A. No, I —
15
plat, is that fair, with the engineering aspects of the
15
Q. Or you don't know the answer?
16
plat?
16
A. A whole lot of crosses paperwork my desk, and
17
A. Well, not --when they do plat review, there's
17
I, you know, right now a memo is not required, I don't
18
a lot of engineering requirements, a lot of issues that get
18
believe, and so, you know, I see memos coming across
19
Incorporated into those documents. And a lot of those
19
regarding these projects, but when you ask me specifically
20
issues are probably some planning issues, some engineering
20
to tie a memo to projects and numbers, I don't know.
21
issues, and we today would get them incorporated into the,
21
Q. On a plat, during the plat approval process, if
22
you know, the planner's report
22
you did not receive a review memo from the city engineer,
23
Q. And so if there are no issues on a plat from an
23
would you assume that all of the grading and drainage and
24
engineering perspective, would you expect the city engineer
24
engineering aspects of the plat were okay?
25
to write you a memo saying everything looks fine, we checked
25
A. Yes.
30
32
1
grading, there's no issues, and you would incorporate that
1
Q. Would you go to the city engineer and
2
into the report?
2
double-check, bring it to their attention and say, I didn't
3
A. 1 think the majority of the time the engineer
3
get your memo, is everything okay?
4
writes a report, you know. Usually it's directed to me, and
4
A. No.
5
that gets incorporated into the council communications, you
5
Q. So it wouldn't raise a red flag to you if you
6
might say.
6
didn't receive a review memo from the city engineer?
7
Q. Okay. How many plats have been completed while
7
A. The city engineer comes forward with a
8
you have been city administrator?
8
recommendation on the project, and when the engineer does
9
A. I think I'd say quite a few, but i don't have a
9
that, there's the assumption that he's done all his due
10
number.
10
diligence.
11
Q. More than a dozen?
11
Q. And if the city engineer doesn't come forward
12
A. In three years maybe — I'll guess at four or
12
with a recommendation but just sits there and doesn't say
13
five a year.
13
anything, are you assuming that he's conducted the review
14
Q. Four or five a year?
14
and there's no problem?
15
A. Yeah.
15
A. Yes.
16
Q. Okay. And of those approximately four or five
16
Q. Do you have any checklist that you follow to
17
plats a year that have been completed while you have been
17
make sure things are done in the plat process?
18
city administrator, have you received a review memo from the
18
A. Our city planner, you know, oversees that
19
city engineer on all of those?
19
process.
20
A. You know, I guess I don't know. 1 couldn't
20
Q. Do you know if he has a checklist?
21
answer that.
21
A. No, I don't.
22
Q. Do you have the — can you go back to your
22
Q. So you don't have a checklist that you, as city
23
office and look through some documents and get me an answer
23
administrator, follow in the plat process?
24
to that question?
24
A. I mean, there are, you know, bigger concept
25
A. Yeah. You know, we have all the files and all
25
plan, preliminary plat, final plat, you know, those type of
(irby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Paqes 29 through 32 of 176
Larry Kruse, March 13, 2007
s
1
33
development agreements, bigger but not all the detail that
1
35
Q. So if you saw something in the city planners
2
goes on behind the scenes.
2
work, in a memo, or a document that was prepared by the city
3
Q. So when you say they're bigger, you mean
3
planner that you knew to be incorrect, would you bring that
4
there's an ordinance or provision of the code that tells you
4
to the attention of the city council, or do you go to the
5
what to do, or what do you mean?
5
city planner, or what do you do?
6
A. The planning process — I mean, there's basic
6
A. It could be a combination of both.
7
steps that we follow, but I may be not understanding your
7
Q. And when you're looking at the city planners
8
question.
8
memorandums and documents that come across your desk, are
9
Q. I'm just wondering if there is a checklist. Do
9
you looking to be sure they're accurate?
10
you look to a piece of paper and see --
10
A. I review them. You know, I won't spend — I
11
A. No. No. 1 don't have a checklist
11
have a lot of broad functions. We're a small city with
12
Q. Okay. When a plat is submitted, do you go back
.12
limited staff, and we have a trust relationship and a
13
and look at the portions of the ordinances and city code to
13
history with our consultants that they know and understand
14
see, hey, did the developer submit ABC?
14
the expectations and, you know, go about their work in a
15
A. Our city planner oversees that, consulting
15
prompt and diligent way. That's our expectation.
16
planner oversees that planning process.
16
MS. MATT: Could you read the question
17
Q. And you oversee his work, you said earlier.
17
back again, please?
18
Correct?
18
(Whereupon the requested portion of the record
19
A. Yeah.
19
was read aloud by the Court Reporter.)
20
Q. So do you, when you are overseeing the work of
20
A. To the best of my knowledge, yes.
21
the city planner, go and check through the ordinances,
21
Q. And if you noticed any inaccuracies in
22
subdivision ordinances, those types of things to be sure
22
documents prepared by the city planner, you would bring
23
that the developer and the developers engineer submitted
23
those to the attention of the city council?
24
all of the things that are required for the plat process?
24
A. The city council and city planner.
25
A. The city has a trust relationship, a history
25
Q. Mr. Kruse, I had asked you if there was a
34
36
1
with our city planner, along with that, normal expectations
1
particular point in the platting process that the city
2
that he knows and understands the codes and when he makes
2
expected the grading and drainage and engineering aspects to
3
his recommendations, that they meet all the requirements.
3
be reviewed. Do you recall that?
4
MS. MATT: Could you read the question
4
A. Uh-huh.
5
back, please?
5
Q. Yes?
6
(Whereupon the requested portion of the record
6
A. Yes.
7
was read aloud by the Court Reporter.)
7
Q. And you said that typically the council
8
A. No.
8
expected it to be done by the time of the planning
9
Q. So your answer to that question, Mr. Kruse, was
9
commission meeting preliminary plat. Correct? That's what
10
no?
10
you —
11
A. Right.
11
A. I guess maybe I — you know, I — I look at the
12
Q. Yes?
12
development process as kind of a continuum, and there's a
13
A. Right
13
lot of interactions that go on, so If I have to clarify
14
Q. Okay. Because you trust the city planners
14
myself, you know, I'm not sure exactly when all those things
15
A. Right.
15
come forward in the process. Once again, the engineers do
16
Q. So what do you do that's overseeing the city
16
this on a daily basis, and they have -- they know the
17
planners work?
17
process and what the expectations are. And right now I look
18
A. Well, when we say as city administrator, once
18
at It as a continuum, and there's reviews and, you know,
19
again, I am a conduit I don't oversee as in an employee
19
sometimes when you get new information, you go back and
20
relationship. It's a consultant/city relationship, and so 1
20
maybe things are changed or adjusted to make sure that we
21
don't review their detailed work. They get direction from
21
protect the public interest
22
the council, and they make recommendations to the council,
22
Q. Certainly you would expect that by the time the
23
and I'm a conduit of that information to the council, and
23
council, city council approves a final plat, the grading,
24
then I'm kind of the eyes and ears of the council on a daily
24
drainage, and engineering aspects of the plat would have
25
basis in numerous meetings and interactions with people.
25
been reviewed --
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 33 through 36 of 176
Larry Kruse, March 13, 2007
10
37
39
1
A. Yes.
1
A. My assumption would be that if the council
2
Q. — and commented on and approved by the city
2
approves it, yes, the developer would do the same.
3
engineer. Correct?
3
Q. The developer could assume that the city
4
A. Yes.
4
engineer reviewed and approved the grading, drainage, and
5
Q. Okay. And the developer then at the time the
5
engineering aspects of the plat?
6
final plat is approved by the city council can assume that
6
A. Yes.
7
the city engineer reviewed, commented, and approved the
7
Q. And the same thing — question with respect to
8
grading, drainage, and other engineering aspects of the
8
the developer's engineer. If the city council can assume at
9
plat. Correct?
9
the final plat process that the grading and drainage plans
10
MR. KUBOUSHEK: I'll object to the form
10
were reviewed and approved by the citys engineer, is it
11
of the question. It lacks foundation. I don't know if the
11
also fair to assume that the developer's engineer can assume
12
witness has information to make that assumption. Answer it
12
that the grading and drainage plans have been reviewed and
13
if you can.
13
approved by the city's engineer?
14
Q. Go ahead.
.14
MR: KUBOUSHEK Object to the form of the
15
A. You know, our council has high expectations of
15
question. Lacks foundation. Requires Mr. Kruse to assume
16
our consultants, and they expect them to have thoroughly
16
what the design engineer knows. Answer if you can.
17
reviewed and dealt with any of the issues prior to making a
17
A. You know, I think that when the city council
18
recommendation to the council for approval. Do you want to
18
makes any approvals, they assume that everybody throughout
19
repeat the question so I —
19
the process has done their work and Is giving their
20
Q. The city is assuming at the time that the final
20
approval.
21
plat is approved by council that the engineer has reviewed
21
Q. So if the city council is assuming that
22
and approved the grading, drainage, and engineering aspects
22
everyone's done their work, they're assuming that — the
23
of the plat. Correct?
23
city council is assuming the city engineer reviewed the
24
A. Yes.
24
plat. Correct?
25
Q. So is it fair to say that the developer then
25
A. Yes.
38
40
1
can also assume, like the city is assuming, that the
1
Q. And so the developer's engineer could also
2
grading, drainage, and engineering aspects of the plat have
2
assume at that point, at the point of final plat approval,
3
been reviewed and approved by the city engineer?
3
that the city's engineer reviewed the grading, drainage, and
4
MR. KUBOUSHEK: Object to the form of the
4
engineering aspects of the plat. Correct?
5
question. Lacks foundation. Asking him to assume what the
5
A. I guess I would say yes. I'm assuming what the
6
developer thinks. Answer it if you can.
6
developer would assume.
7
Q. Go ahead and answer.
7
Q. What specific role does the city attorney play
8
A. You know, I've always In my job understood that
8
in the plat process?
9
our city engineers aren't the designer of these projects.
9
A. The city attorney provides legal guidance
10
We review them, but we — you know, we don't do the —
10
throughout the platting process on all of the requirements
11
reengineer it, you might say. Our expectation is that the
11
and in the end develops a development agreement between the
12
engineer reviews all the engineering on all plats to make
12
city and the developer which sets up the expectations of the
13
sure that it works, and the council has high expectations
13
city and developer.
14
that all issues have been addressed prior to making any
14
Q. Anything else that the city attorney does with
15
approvals.
15
respect to the platting process?
16
Q. And so again, Mr. Kruse, if the city is
16
A. The city attorney is a part of our development
17
assuming at the final plat approval meeting that the city
17
team, attends all of those staff meetings, or the majority
18
engineer reviewed the grading, drainage, and engineering
18
of them and, you know, provides legal guidance throughout
19
aspects of the plat, then is it fair to say that the
19
the process.
20
developer can also assume that the citys engineer has
20
Q. As to whether the plat meets the requirements
21
reviewed the grading, drainage, and engineering aspects of
21
of the citys ordinances and subdivision ordinances?
22
the plat?
22
A. I would say all aspects of city ordinances,
23
MR. KUBOUSHEK: Same objection. Lacks
23
yes.
24
foundation. Asks him to assume what the developer knows.
24
Q. And what role does the city council play in the
25
Q. Go ahead and answer.
25
plat process? Do theyjust give it a stamp of approval at
Kirby A. Kennedy &Associates 952-922-1955 1-800-545-1955
Pages 37 through 40 of 176
Larry Kruse, March 13, 2007
11
1
41
the end, or what are they doing?
1
43
2
A.
own assessment of whether the grading and drainage plans
The city council receives a recommendation from
2
submitted by Gold Key Development as part of this plat
3
the planning commission. Our staff, primarily the city
3
process complied with city code ordinances and subdivision
4
planner, gives a thorough review, takes comments, and our
4
ordinances?
5
council is pretty familiar with development so they usually
5
A. Not that I'm aware of.
6
have questions and staff responds — staff, i.e.,
6
Q. Did you?
7
consultants, I should say.
7
A. No.
8
(At this time Larry Kruse Deposition Exhibit
8
Q. Did the city planner?
9
Number 94 was marked for identification by the
9
A. I would say yes.
10
Court Reporter.)
10
Q. Did the mayor?
11
Q. Mr. Kruse, handing you what's been marked as
11
A. No
12
Exhibit 94, do you recognize that document?
12
Q. Did the city attorney?
13
A. Yes, I do.
13
A. Yes.
14
Q. And what is it?
14
Q. And as to the city plannerand the city
15
A. Plat of the Prairie Run Addition.
15
attorney, what do you believe was their assessment of
16
Q. And on the first page of Exhibit 94, the plat
16
whether the grading and drainage plans submitted by Gold Key
17
of Prairie Run Addition on the right-hand -- in the second
17
complied with city code ordinances and subdivision
18
column on the right-hand side about halfway down, that's
18
ordinances?
19
your signature on there?
19
A. In my opinion, based that they are making a
20
A. Yes.
20
recommendation to move forward with the plat, that they
21
Q. On June 71h, 2004?
21
would assume that it meets all code requirements.
22
A. Yes.
22
Q. And ordinances and subdivision ordinances?
23
Q. And it says above your signature, "This plat of
23
A. Uh-huh.
24
Prairie Run was approved and accepted in compliance with
24
Q. Yes?
25
Minnesota Statute Section 505.03 Subdivision 2 by the City
25
A. Yes. Sorry.
1
42
Council of the City of Albertville, Minnesota, at a meeting
1
44
Q. Mr. Kruse, handing you what's previously been
2
held this 7th day of June, 2004"?
2
marked as Deposition Exhibit 80, the June 7th, 2004, city
3
A. Yes.
3
council meeting minutes, do you see in the first paragraph
4
Q. And what does that mean to you that it's in
4
that you were present at that meeting?
5
compliance with that Minnesota statute?
5
A. Yes.
6
A. It means that the city council approved this
6
Q. And then if you flip forward to the fourth page
7
plat based on the recommendations of our consultants.
7
of Exhibit 80, do you see the subparagraph "Prairie Run
8
Q. And that it was in compliance with that section
8
Improvement Project"?
9
of the Minnesota statutes?
9
A. Yes.
10
A. Yes.
10
Q. And then if you flip forward to the next page,
11
Q. Okay. And at that point on June 7th, 2004, did
11
page 5 of Exhibit 80, it looks like about a quarter of the
12
the city believe that SEH had reviewed and approved the
12
way down, "Councilmember Beming, seconded by Councilmember
13
grading and drainage plans submitted by Gold Key as part of
13
Rich moved to approve recording the final Prairie Run Plat."
14
the plat process for Prairie Run?
14
Do you see that?
15
A. Yes.
15
A. Yes.
16
Q. And at that point on June 7th, 2004, was it
16
Q. It doesn't look to me like a whole lot of
17
reasonable for Gold Key and Hedlund Engineering to assume
17
discussion went on at that meetingJanuary on —excuse me,
18
that the plans that they submitted had been reviewed and
18
June 7th, 2004.
19
approved by the city engineer, by SEH?
19
A. Uh-huh.
20
A. Yes.
20
Q. Do you recall any specific discussion about
21
Q. And did the city have any reason to believe
21
whether to approve this final plat? Or tell me what you
22
that the grading and drainage plans submitted by Gold Key
22
recall about that meeting.
23
had not been reviewed and approved by SEH?
23
A. I think the council was very aware of the
24
A. No.
24
Prairie Run project and understood that staff and everyone
25
Kirby A. Kennedy
Q. Did anyone on the city council undertake their 125
& Associates
had worked with the developer through a number of scenarios.
952-922-1955 1-800-545-1955
Pages 41 through 44 of 176
Larry Kruse, March 13, 2007
12
45
47
1
They were very familiar with the project, and based on this
1
discussion at this June 7th, 2004, meeting that was not
2
motion they expected the consultants and staff to have done
2
reflected in the minutes?
3
all of their due diligence and approve the plat
3
A. When plats come through, the planner makes a
4
Q. And so is it a fair assessment that not a whole
4
presentation to the council, and I don't remember if all the
5
lot of new discussion went on with respect to the Prairie
5
issues had been resolved at this meeting or not, so if it
6
Run improvement project at that June 7th, 2004, council
6
was early on when this project was in more of its infancy,
7
meeting?
7
you know, there's probably a lot of discussion. Usually
8
A. You know, I think there was discussion. It's
8
when a plat get close to final approval, staff has worked,
9
not noted here, but I think there was quite a bit of
9
consultants have worked through all of the issues and
10
discussion.
10
have — you know, aren't going to make a recommendation to
11
Q. Okay. Well, typically doesn't — who is
11
the council unless they're very comfortable that this is a
12
keeping the minutes of the city council meetings?
12
project where all the I's have been dotted.
13
A. Bridgette Miller, our city clerk.
13
Q. Right. And I'm just trying to figure out at
14
Q. And typically wouldn't Bridgette Miller, if.
14
this particular meeting on June 7th, 2004,.whether anything
15
there was quite a bit of discussion on something, wouldn't
15
else happened besides what's noted in the minutes.
16
she put it in the minutes?
16
A. I don'tremember.
17
A. You know, in looking at it here now I think
17
Q. If the planner made a presentation to council
18
there should have been more, but she's summarizing the final
18
about the Prairie Run project, that would be noted in the
19
council action.
19
minutes, wouldn't it? It would say City Planner Al Brixius
20
Q. Okay. Typically if there was quite a lot of
20
presented to city council —
21
discussion about something, wouldn't Bridgette Miller, the
21
A. It should, yeah.
22
city clerk, note it in the city council minutes?
22
Q. And it does not say that. Correct?
23
A. Not all the time but —
23
A. No. I haven't read it here all.
24
Q. Typically?
24
Q. Is there any document that would help you
25
A. Yes. Yes.
25
recall whether there was anything else discussed at the
46
48
1
Q. Okay.
1
June 7th, 2004, city council meeting about Prairie Run other
2
A. More than what's here.
2
than what's reflected in the minutes?
3
Q. Tell me what was discussed that's -- what was
3
A. Usually the planner has a recommendation, makes
4
discussed on June 7th, 2004, at the city council meeting
4
a presentation, has a recommendation and — let me read the
5
about Prairie Run that's not noted in the minutes?
5
minutes here just a little bit
6
A. You know, I don't recall any specifics.
6
Q. Sure.
7
Q. Okay. Well, you've just told me that there was
7
A. I would say this motion, you know, looking at
8
quite a bit of discussion about Prairie Run that wasn't
8
the other motions, this was at the culmination of a long,
9
noted in the minutes.
9
lengthy process, and you can see by the previous motions a
10
A. Typically the council, you know, quizzes the
10
number of things are happening in succession there, and
11
consultants on, you know, a number of issues, just the —
11
these are kind of the final steps in approval, and prior to
12
they're very knowledgeable and diligent to make sure things
12
that time the council, you know, met several times on this.
13
are done right And I'm just making assumption that there
13
Q. Mr. Kruse, maybe it will help you to take a
14
was some discussion on it, and once again, this whole
14
look at Exhibit 78, a memo from the City Planner AI Brixius
15
project is kind of a continuum, and I know it went through a
15
to yourself dated June 2nd, 2004, so just five days before
16
lot of different — some different concepts, and so for me
16
that city council meeting.
17
to remember back If there was a lot of discussion at this
17
A. Okay.
18
specific meeting or it was a prior meeting, it all becomes
18
Q. Do you recall receiving that document?
19
kind of melded together. Maybe I need to clarify that first
19
A. Yes, it looks very familiar.
20
one. I don't remember any speck discussion at this
20
Q. And that would have been received by you prior
21
meeting.
21
to the June 7th, 2004, meeting?
22
Q. About the Prairie Run project other than what
22
A. Yes.
23
was listed in the minutes?
23
Q. And in that document is the city planner making
24
A. Right
24
a recommendation as to whether the council should approve
25
Q. So do you believe that there was additional
25
the plat of Prairie Run?
4irby A. Kennedy
& Associates 952-922-1955 1-800-545-1955 Pages 45 through 48 of 17
Larry Kruse, March 13, 2007
13
49
51
1
A. Yes. It says staff recommends approval of the
1
MS. MATT: Off the record for a minute.
2
final plat with conditions.
2
(At this time a discussion was held off the
3
Q. And are any of the conditions that are listed
3
record.)
4
there that it is subject to review and approval of by the
4
(At this time a brief recess was taken.)
5
city engineer?
5
6
A. I don't see any, no.
6
CROSS-EXAMINATION
7
Q. Mr. Kruse, handing you what's previously been
7
BY MR. YOCH:
8
marked Deposition Exhibit 67, do you recognize that
8
Q. Sir, we're going to take this a little out of
9
document?
9
order because I have some scheduling challenges, so my able
10
A. Yes.
10
co -counsel has been kind enough to let me go. My name is
11
Q. And it's the Preliminary Plat Findings of Fact
11
Steve Yoch. I'm here representing T/C Homes. 1 have just a
12
and Decision. Correct?
12
few questions for you.
13
A. Yes.
13
First of all, when -- you had some discussions
14
Q. And if you flip to the -- well,. at the bottom
14
with Ms. Matt about sort of the general platting process and
15
of the first page, "Decision: Based on the foregoing
15
how things generally occur, and I realize that's sort of a
16
considerations and applicable ordinances, the Rezoning from
16
10,000-foot view. To get a little lower, when the process
17
R-1A to PUD and the Preliminary Plat to be known as 'Prairie
17
starts, from the city's perspective, does the city make an
18
Run' are approved based on the most current plans and
18
effort to give what amounts to all of the information it has
19
information received to date, subject to the following
19
on that property to the city's developer? So here is what's
20
conditions:" And then Number 9 says, "The submitted grading
20
occurred in the past and to give it to either the developer
21
and drainage plan is subject to review and approval by the
21
or the engineer to help them begin the development process?
22
City Engineer." Do you see that?
22
A. Yes.
23
A. Yes.
23
Q. And who is responsible for giving that
24
Q. And if you flip back to Exhibit 78, the third
24
information to the developer or the engineer?
25
page --
25
A. Usually, you know, when we have the initial
50
52
1
A. Witness complies.)
1
meeting, if there's information that we can contribute and
2
Q. — under the Recommendation section it says,
2
help guide, it can come from a number of sources.
3
"Based on our review, we find that the Prairie Run final
3
Q. So essentially is there at the city what
4
plat is consistent with the approved preliminary plat and
4
amounts to a file for kind of each parcel in the city and
5
has compiled with the conditions of the preliminary plat
5
then you go and pull that information and put it in a packet
6
approval." Do you see that?
6
and give it to the developer or their engineer? Is that how
7
A. Yes.
7
it works, or how does it mechanically work?
8
Q. So does that to you mean that the preliminary
8
A. A lot of times these are ag land, you know, so
9
plat condition that the submitted grading and drainage plan
9
there really isn't a file, per se. So in some instances,
10
is subject to review and approval by the city engineer has
10
maybe if there was a previous project that started and
11
been complied with?
11
didn't go forward, there might be, but if it was just
12
A. One more time with your question?
12
farmland, there wouldn't be a lot of information, I don't
13
Q. Yes. I'm wondering if you look at Exhibit 78,
13
think.
14
Mr. Brixius's memo regarding the Prairie Run final plat --
14
Q. Here where we've got — here, being Prairie
15
A. Yes.
15
Run -- we've got Ditch 9 and some wetland, would there be
16
Q. — in the recommendation section, he's saying,
16
something in the city's file about either Ditch 9, the
17
"we find that the Prairie Run final plat is consistent with
17
wetland, or maybe either of the roads that border the
18
the approved preliminary plat and has complied with the
18
property? Would that be then given to the developer to the
19
conditions of the preliminary plat approval."
19
extent it exists?
20
A. Yes.
20
A. I think, yes. I think once again at one of the
21
Q. if that to you means that the condition of the
21
initial meetings when we work with the developer, we do our
22
preliminary plat approval that the submitted grading and
22
best to find whatever information is available, and we're
23
drainage plan is subject to review and approval by the city
23
looking to get the best product that we can, so our goal is
24
engineer has now been complied with.
24
probably the same goal as the developer's, how do you do a
25
A. I guess I would say yes.
25
good project and, you know, keep the cost reasonable for
Kirby A. Kennedy &Associates 952-922-1955 1-800-545-1955
Pages 49 through 52 of 176
Larry Kruse, March 13, 2007
1
53
everybody.
1
14
55
probably does — but I've been at numerous meetings on these
2
Q. Do you know in this case, in Prairie Run, what
2
issues, and that has been the conversation.
3
information was given by the city to the developer?
3
Q. Have you had any contact with my client, T/C
4
A. No, I don't
4
Homes, or any of its employees?
5
Q. is there a file that would reflect that, you
5
A. You know, when we were tying to resolve some of
6
know, something that would say "documents given to the
6
these issues, we had some meetings, some conversations, yes.
7
developer," a folder, or is it going to be more organic?
7
Q. Who did you meet with?
8
A. Not that I'm aware of.
8
A. You know, I don't remember their names right
9
Q. I think you had talked briefly about the Albert
9
now, but one or two builders.
10
Villas property which is on the south side of the county
10
Q. And could you tell me to the best of your
11
road; is that right?
11
recollection what was the nature of your discussions with
12
A. Yes.
12
the builders? Does Mr. Brian Tull refresh your
13
Q. Do you know whether the city is currently
13
recollection —
14
engaged or contemplating litigation relating to that _,
14,
A. Yes: -
15
property?
15
Q. -- from T/C Homes? Anybody else that you can
16
A. We've been discussing it. I don't believe any
16
recall?
17
action has been brought forward.
17
A. I don't remember any names.
18
Q. What's the nature of the dispute or the
18
Q. And what was the nature of your discussions?
19
concerns relating to the Albert Villas property?
19
A. I sat in on primarily a conversation our
20
A. The city, prior to my tenure, received a large
20
engineer probably was leading, a discussion of, you know,
21
rainfall and the neighborhood flooded rather severely, and
21
what ultimately is acceptable to get people to live in those
22
then since I've been here, on two occasions webe had
22
homes. Some building permits were issued, and the city was
23
significant rains that threatened some homes. I don't
23
holding up certificates of occupancies, and we were i think
24
believe any homes were inundated. There may be some that
24
all working together to find out if there was a way to, you
25
had some groundwater problems.
25
know, complete those projects.
1
54
Q. Mr. Hedlund, who is the engineer for Gold Key,
1
56
Q. When you say the city engineer at these
2
opined in his deposition that the cause of the flooding in
2
meetings, who are you talking about?
3
the Prairie Run development was water backing up in a rain
3
A. Adam Nafstad.
4
event from the Albert Villas property, downstream backing up
4
Q. And when did those meetings occur, to the best
5
into the Prairie Run development. Do you have any knowledge
5
of your recollection?
6
about whether, from your discussions with anyone, whether
6
A. Probably, you know, I don't have a good
7
your engineers or others, that the cause of flooding in
7
recollection of time, but maybe mid-2005 or late 2005.
8
Albert Villas is impacting adversely Prairie Run?
8
Q. Was there anyone else present in the meeting
9
A. I believe that water is inundating the entire
9
besides builders, yourself, Mr. Nafstad? Was there anyone
10
area, that, you know, it's the entire watershed that funnels
10
from the developer? Mr. Johnson?
11
down to that area, and whether it's backwater or water
11
A. Part of that might have been even in 2006.
12
coming off the larger drainage area, it accumulates, you
12
Right now I don't know when the litigation and everything —
13
know, in that Prairie Run, Albert Villa area.
13
could you repeat your question, please?
14
Q. My question is a little different. Obviously
14
Q. Sure. I'm just asking who was there, first of
15
when it rains, it rains everywhere mostly.
15
all. You mentioned some of the builders were there. There
16
A. I've heard that there's some backing up
16
was the city engineer, Mr. Nafstad, there. I'm just trying
17
occurring under County Road 18.
17
to get a head count. Was there someone there from the
18
Q. And that is the backup being from the water
18
developer then at that point, do you recall, Mr. Johnson or
19
flowing from Prairie Run into Albert Villa and Albert Villas
19
someone else?
20
is not able to pass through that water so it's causing a
20
A. You know, I think we had a number of meetings,
21
backup into Prairie Run. Is that your understanding?
21
and I recall, you know, Mr. Johnson or maybe someone else,
22
A. That's what my understanding is.
22
Randy Hedlund. There was a number of meetings. I also
23
Q. From whom did you gain that understanding?
23
remember sitting down — our engineer was working with the
24
A. We did a - recently did a flood study, and 1
24
builder to, you know, review what could and couldn't be done
25
don'tremember specifically if it states that in there -- it 125
and maybe seeking some options, and at the same time we had
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 53 through 56 of 176
<irby
ry rouse, marcn 13, 2007
57
59
1
meetings with the developer. So there was a number of
1
you aware that Bolton Menk did an analysis, a flood study of
2
different meetings with different players, but I would
2
Ditch 9 and the related properties?
3
summarize the people as Dean Johnson, probably Randy
3
A. Yes.
4
Hedlund, the builder, Adam Nafstad, Allen Brixlus, our city
4
Q. I'll represent, sir, that Bolton Menk
5
planner and then on occasion our city attorney.
5
calculated a new 100-year flood level of 949.9 feet. Does
6
Q. In terms of the go, no-go decision, that is,
6
that sound right?
7
which property building permits or certificates of
7
A. Sounds familiar.
8
occupancies are going to be issued on, who was the person
8
Q. And they examined a watershed area of
9
from the city's side of the fence ultimately making the
9
approximately 2300 acres. Does that sound right?
10
recommendation — i realize it's subject probably ultimately
10
A. Yes.
11
to the city — but from an operational standpoint, who was
11
Q. Have you had any discussions with Bolton Menk
12
the one saying here is okay, here isn't okay?
12
about how that number, that is, the 949.9 100-year flood
13
A. I think our city engineer.
13
level, do you know what 100-year flood level was used by
14
Q. And that would be Mr. Nafstad again?
14,
Hedlund Engineering in putting together the plat in this
15
A. Yes.
15
matter?
16
Q. Did Mr. Moberg play any role in these meetings?
16
A. You know, i recall something about aquatic
17
A. I should say he was also involved, yes. And
17
vegetation.
18
actually Mr. Moberg probably, you know, that was one of the
18
Q. And that was used for the 100-year flood level,
19
projects that SEH was finishing up, so, yeah, he was
19
but do you -- have you had any discussions about the fact
20
involved.
20
that the difference between what Hedlund used, which I'll
21
Q. Had you had any contact with T/C Homes prior to
21
represent to you is 950.5 feet, and the 494.9 feet, 6/10ths
22
beginning your work at Albertville?
22
of a foot difference, whether that —
23
A. Not that I'm aware of.
23
MR. VAN DER MERWE: 949.9.
24
Q. Not in any of the other cities you've worked
24
MR. YOCH: Did i say it backwards?
25
in?
25
MR. VAN DER MERWE: Yes.
58
60
1
A. Not that I'm aware of or remember.
1
MR. YOCH: Thank you.
2
Q. Do you know what role, if any, T/C Homes played
2
BY MR. YOCH:
3
in the development, that is, putting together the plat?
3
Q. — that there's a 6/10th of a foot difference
4
A. As far as 1 know, they were someone that just
4
between the two 100-year calculations? Have you had any
5
bought a lot from the developer after.
5
discussions with either Bolton Menk or anyone else whether
6
Q. To your knowledge, did T/C Homes construct the
6
that is a material difference?
7
homes that they purchased — the lots they purchased
7
A. After experiencing all the floods, everything
8
consistent with the requirements of the approved plat?
8
is material, you know, if water is threatening homes.
9
A. Yes, at the time, yes.
9
Q. Do you know if there are currently any specific
10
Q. Well, my point, sir, is at this point there
10
homes that are threatened in the Prairie Run development to
11
is -- the only plat that's been approved is what you looked
11
flooding?
12
at, Exhibit 94. Correct?
12
A. You know, I probably defer to our engineer to
13
A. Yes, it was consistent with that.
13
give me specific direction, but my recollection of
14
Q. Put another way, are you aware of anything
14
conversation is we're talking about some of the freeboard
15
theyve done that is inconsistent with either the city's
15
requirements that provides a safety net
16
instructions or the requirements of the plat?
16
Q. I'm going to show you, sir, a document that was
17
A. No.
17
previously marked as Deposition Exhibit Number 22, and that
18
Q. Have you had any chance to evaluate any of the
18
was generated by the city engineer as of January of this
19
damages that T/C Homes has claimed in this lawsuit?
19
year. Have you seen a document, either this document or a
20
A. No.
20
document like it, generated by the city engineer?
21
Q. Have you instructed anyone in your staff to
21
A. I saw one the other day on my desk, yes.
22
make an evaluation of the damages claimed by T/C in this
22
Q. And correct me if I'm wrong, sir, but the
23
lawsuit?
23
properties that have hash marks in them are properties that
24
A. No.
24
the city engineer is expressing concerns about issuance of
25
Q. Now, I think you sort of alluded to it. Are
25
either a certificate of occupancy or a building permit. Is
Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 57 through 60 of 176
15
Larry Kruse, March 13, 2007
16
61
1 that your understanding?
1
63
the map?
2 MR. KUBOUSHEK: Object to the form of the
2
A. I don't know if I'm answeringyour question,
3 question in that it lacks foundation.
3
but it's my understanding that the development is in
4 MR. YOCH: Fine. I'll go the long way
4
default, and, you know, at that point we're looking at it
5 then. I was going to try and save us time.
5
from a little higher up.
6 BY MR. YOCH:
6
Q. My question wasn't about the default, sir. My
7 Q. Sir, why don't you explain to me what your
7
question is that the city is refusing to issue building
8 understanding of the hash marks are on this document,
8
permits on properties, all the properties, even those that
9 Exhibit 22.
9
are not a subject of a concern as to building height.
10 A. You know, I just look at the legend here, and
10
Correct?
11 as -built low opening elevation, as -built low floor
11
A. Yes.
12 elevation, walkout — yeah, that's the area of concern.
12
Q. And, however, the city will issue certificates
13 Q. Okay.
13
of occupancies as to homes that have been constructed that
14 _ (At this time Larry.. Kruse Deposition Exhibit
14
meet building elevation requirements. So am I understanding
15 Number 95 was marked for identification by the
15
that as being those lots that are, for lack of a better
16 Court Reporter.)
16
word, not subject to hash marks on Exhibit 22? If you have
17 Q. Sir, I'm going to show you what's been marked
17
a house that's built, there's no hash marks on the property
18 as Exhibit Number 95, and I'll represent to you this is a
18
on this map, and you're ready for occupancy, the city would
19 letter that we received from your counsel this morning. if
19
issue a certificate of occupancy; is that correct?
20 you go to the second page, you're copied. I don't know if
20
A. Yes, if it meets elevation.
21 you've had a chance to read the letter yet.
21
Q. And at least according to this map, those would
22 A. I've briefly seen it this morning, yes.
22
be those properties that don't have the hash marks on the
23 Q. And what I'm understanding from the second
23
lots. Correct?
24 paragraph of the letter is the city council is directing "me
24
A. Apparently.
25 to inform you the city will not be issuing any new building
25
Q. Are you aware that the -- the map we have
62
1 permits on the Prairie Run project because the project is in
1
64
there, Exhibit 22, is dated January 4 of 2007. Are you
2 default. The city will, however, issue certificates of
2
aware of any updated map that's been generated by Bolton
3 occupancy where a lot has previously been given a building
3
Menk?
4 permit and the homes meet the city's building elevation
4
A. You know, like I say, 1 recently saw one, but 1
5 requirements." And then the minutes relating to that are
5
don't recall the date on it, whether it was this one or
6 attached, which I'm not going to go over right now.
6
another one.
7 What I'm trying to understand, sir, is looking
7
Q. It looks similar to this?
8 at Exhibit 22, which is the map, what's your understanding
8
A. 1 would sayyes. You know,l didn't study it
9 of which lots — first of all, I gather no lots will the
9
1 saw it and I say, well, it graphically shows our — but 1
10 city be issuing building permits; is that correct?
10
haven't analyzed it at all.
11 A. Any that don't meet the — I have to read it
11
Q. This might be a question for your counsel.
12 here again.
12
MR. YOCH: is there an updated map beyond
13 Q. As I read it, there will be no building permits
13
what we have here, Jason, do you know?
14 issued on any lots —
14
MR. KUBOUSHEK: 1 have not been provided
15 A. Right
15
one by Bolton & Menk.
16 Q. — in the development. Please correct me if
16
MR. YOCH: Okay. And let me represent
17 I'm wrong.
17
and ask on the record, if there is an updated map that is in
18 A. No, that's right.
18
any way different from Exhibit 22, obviously that is of
19 Q. So even — if I can just come over, sir -- even
19
intense interest to both my client and everybody else, and
20 those lots, for example, the ones that border County
20
if that can be provided --
21 Road 18, there's no hash marks on them, or the lots that are
21
MR. KUBOUSHEK: It will be if I receive
22 on the easterly corner of the property, the Kalland Court
22
one.
23 lots which -- would you agree with me there doesn't appear
23
MR. YOCH: Right now we're working off
24 to be any expressed concerns by the citys engineer about
24
Exhibit 22.
25 the height of those properties? Would you agree, based on
25 BY MR. YOCH:
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 61 through 64 of 176
Larry Kruse, March 13, 2007
17
65
67
1
Q. Could you tell me, sir, what role has the city
1
that your understanding?
2
attorney played in the decisions to — first I should
2
A. Yeah.
3
probably find who is the city attorney. When you look at
3
Q. It indicates in here that the city attorney
4
the minutes, it talks about based on a recommendation by the
4
recommended not reduce the letter of credit. it doesn't
5
city attorney. Is that city attorney Mr. Kuboushek, who is
5
mention anyone else. Likewise, it says the city attorney
6
sitting here, or is it Mr. Court?
6
reminded the council the litigation with Gold Key is
7
A. Mike Court.
7
continuing. Is it the normal practice in the minutes where
8
Q. What role has Mr. Court played in the decisions
8
individuals have made recommendations and they not be
9
of the city to issue building permits or issue certificates
9
referenced in the minutes?
10
of occupancy?
10
A. Our consultants all sit together at a table,
11
A. I think our engineer has been, you know,
11
and we are — as far as I know, all the time we've been in
12
probably the technical person looking at whars acceptable
12
consensus when recommendations are made.
13
and isn't City Attorney Court has been involved in a
13
Q. What I'm asking, sir, is that's not what's
14
number of meetings talking about this, project, and so - but
14
reflected in the minutes: Would you agree?
15
primarily the engineer.
15
A. Right.
16
Q. And the reason I ask, sir, is if we go back to
16
Q. So are the minutes in error?
17
Exhibit 94 and if you go to --
17
A. No. 1 think Mr. Court was making a
18
MR. KUBOUSHEK: Which exhibit?
18
recommendation with the knowledge that, you know, the city
19
MR. YOCH: Excuse me, Exhibit 95.
19
engineer would be supporting that
20
Q. — Exhibit 95, third to the last page, it looks
20
Q. But it would certainly appear here that
21
like on the top it's cut off, 11 of 15.
21
Mr. Court is taking the lead on making the decision
22
A. Yes.
22
certainly with respect to the letter of credit and making a
23
Q. And at the bottom I believe that's the
23
recommendation to the city; is that correct?
24
discussion about Prairie Run. Do you see that going onto
24
A. Yeah, I think whenever we get into litigation,
25
the next page?
25
a lot of times the city attorney plays that role.
66
68
1
A. Yes.
1
Q. He references a default by the developer. What
2
Q. And it appears when I read this that the city
2
is your understanding of a default by the developer?
3
council is relying upon recommendations from Attorney Couri
3
A. You know, I guess I don't know the specifics,
4
in making decisions about the letter of credit; is that
4
but we know that we've learned that the lots, certain lots
5
right?
5
cannot meet the elevation requirements above the flood stage
6
A. Yes. Yes. After, you know, after, you know, a
6
that's been identified. We know that some of the homes the
7
lot of input from our city engineer, he's carrying the
7
freeboard isn't adequate, and so technically they don't meet
8
message.
8
the ordinance. I'm trying to think if he has kept current
9
Q. Well, and there's a message also that they're
9
on all of his billing, that would be another reason. I'm
10
in default. Is the city engineer or the city attorney
10
not sure on that right now.
11
advising the city council that Gold Key is in default?
11
Q. Stick with the last one first. As you sit here
12
A. You know, I think both. You know, we operate
12
today, do you know whether Gold Key is not current on its
13
as a development team, you might say -- our city planner,
13
billings?
14
city attorney, and engineer — and we collectively review
14
A. I'm thinking they aren't, but I'd have to
15
these things, and it may be a different person, you know,
15
verify that.
16
may be the city attorney making a recommendation, but that
16
Q. They are not current?
17
recommendation would be the consensus of myself and the
17
A. Gold Key? You know, I'm not sure. I'd have to
18
other consultants most likely.
18
review that
19
Q. Are these ,approved minutes that I'm looking at
19
Q. So to your understanding, is that the basis for
20
here? Do you know if these minutes have been approved? The
20
the default, or is it the height and lot requirements that
21
February 5, 2007, meeting?
21
we're talking about?
22
A. Usually they're approved the following meeting
22
A. I think ifs the health safety flooding issue
23
after, so the 7th is the first meeting of the month. They'd
23
that's, you know, primarily the problem.
24
be approved the following — two weeks later.
24
Q. The city is taking the position that Gold Key
25
Q. So these probably would have been approved. Is
25
is in default as to the proper level of lots in this
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 65 through 68 of 176
tarry Kruse, March 13, 2007
18
69
71
1
development. Correct?
1
together the Prairie Run project by Gold Key?
2
A. Yeah.
2
A. Maybe not in seeking out maybe additional
3
Q. And certainly would you agree with me that the
3
information. You know, when — and we're talked about this.
4
lots of the development that have been built and that are
4
When you go stand out there where the flooding occurs, It
5
intended to be built are at least consistent with
5
appears quite obviously that by the box culvert and Ditch 9
6
Exhibit 94, that is, the approved plat. Correct?
6
that there could be problems.
7
A. I would assume so.
7
Q. Same question as to my client, T/C Homes. Are
8
Q. And the city at this point has commenced a
8
you aware of any errors or mistakes made by my client, T/C
9
lawsuit not only -- or is in litigation not only with Gold
9
Homes, in any of the work it performed?
10
Key, but actually commenced an action against SEH. Is that
10
A. I don't think so.
11
your understanding?
11
Q. Same question as to Gold Keys engineer,
12
MR. MARKERT: I object just to the fact
12
Hedlund Engineering. Are you aware of any mistakes or
13
that it's not a — the city has not commenced litigation
13
errors they made as it relates to the Prairie Run project?
14
against SEH. They've brought a contribution in indemnity
14
A. In hindsight, you know, knowing about the
15
claim that is part of the lawsuit commenced by Gold Key.
15
letter, the county and the box culvert, you know, I would
16
BY MR. YOCH:
16
say yes.
17
Q. Sir, do you have an understanding that the city
17
Q. Sir, when you talk about the letter and the box
18
has sued SEH?
18
culvert, is this what you're talking about, the culvert risk
19
A. I haven'tseen anything. You know, i know that
19
assessment, Exhibit 65?
20
we're contemplating all remedies to fix these flooding
20
A. You know, i don't recall this document. 1
21
issues and the problem. Formally I have not received
21
was — I'm familiar recently of another letter, I thought,
22
anything at all, so I'd have to say that it's definitely on
22
but, you know, I don't believe I've seen this document.
23
the top of our list.
23
Q. Can you describe for me the letter that you're
24
Q. Sir, do you know whether or not the city has
24
thinking of that — well, first of all, explain to me the
25
sued SEH?
25
significance of the letter and how that relates to
70
72
1
A. I guess I don't. Not —
1
Mr. Hedlund's responsibility where you believe he may have
2
Q. To your knowledge, has the city ever authorized
2
erred.
3
a suit against SEH?
3
A. You know, I guess I don't know all the
4
A. I'd have to look back at the specific language,
4
engineering details or anything like that. I just know that
5
but the council wants our staff to pursue all remedies and
5
our development team feels that the elevations are not
6
look to everybody — SEH, the developer.
6
adequate right now.
7
Q. If — I'm going to represent to you, sir, that
7
Q. Sir, do they still feel that way in light of
8
there has been an action against SEH by the city. Who would
8
the completion of the Bolton Menk flood study, that is, that
9
have, if you're the city administrator and you're not aware
9
there still is a material or significant difference between
10
whether that's correct, that's your testimony, who would
10
the 100-year flood elevation used by Mr. Hedlund in the plat
11
have authorized the city's attorneys to commence the action?
11
versus the flood level calculation that's recently been
12
A. The city council early on, you know, authorized
12
completed by Bolton Menk? Do they still feel there's a
13
staff to pursue that, but whether, you know, my answer
13
material difference?
14
regarding — I haven't formally. i don't know the dates
14
A. I would say yes.
15
when — I haven't seen anything yet
15
Q. Do you know whether an assessment has been made
16
Q. And I'm not asking for a specific date.
16
by Bolton Menk to examine whether there is indeed a material
17
A. But the council authorized.
17
difference between the 100-year flood level as used by
18
Q. As you sit here today, sir, do you believe that
18
Mr. Hedlund and the new one as calculated by Bolton Menk?
19
SEH made any errors or mistakes in the course of performing
19
A. I just don't feel I have the expertise to
20
its services relating to the Prairie Run project?
20
answer that.
21
A. In hindsight, if they didn't review the
21
Q. And I'm not asking if you have the expertise to
22
project, our expectation would have been that it was
22
make that materiality calculation. I don't either. I'm
23
reviewed and met all our ordinances and codes.
23
asking whether you know whether that assessment has been
24
Q. As you sit here today, sir, do you have any
24
made, that is, whether or not they still believe, in light
25
belief or understanding of any errors made in putting
25
of the flood study that was completed by Bolton Menk
<irby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Panes 69 through 72 of 176
y Kruse, March 13, 2007
19
73
75
1
relatively recently, whether there still is a material
1
A. Yes.
2
problem here with this project.
2
Q. What was the result of those discussions prior
3
A. Yes.
3
to the litigation? What was the response by the developer
4
Q. And the conclusion is, yes, there still is a
4
or the city to those areas? Was there ever -- let me back
5
material problem? Is that what you're saying?
5
up. Bad question.
6
A. The approved plat is too low and does not meet
6
Did you ever — are you aware of a concrete
7
the intent of our ordinance, and so, yes, there is a
7
proposal that was made by either the city or the developer
8
problem.
8
that here is our proposed fix and this will address all the
9
Q. And when is the last time you had a discussion
9
issues? Did it come down to that level of discussion?
10
with someone about that concern?
10
A. I don't think there was anything in writing,
11
A. It was probably in the latter part of 2006.
11
but 1 think there was some suggestions that if Gold Key
12
Q. Who did you have that discussion with?
12
could sign off or the builder could sign off that they
13
A. You know, I don't recall having a specific
13
acknowledge it didn't meet the freeboard, there was some
14
discussion. I'm trying to kind of aggregate all the things
14
room to issue permits on homes that had already been issued
15
that I hear. 1 know that all of our consultants that we
15
a building permit. But 1 don't — you know, when you say
16
rely on, city engineer, are recommending that the proposed
16
formal, I think these were discussions, brainstorming, you
17
development as it is doesn't meet the requirements of the
17
know, trying to find a solution.
18
ordinance and thus that there's a potential for flooding.
18
Q. I gather the brainstorming didn't come to a
19
Q. Have you had any discussions with anyone
19
successful resolution in terms of resolving the issues. Is
20
concerning potential fixes to the problem you're discussing?
20
that fair?
21
You've been told there's a problem with the height of the
21
A. You know, I thought we were working toward some
22
development. Is that fair?
22
acceptable solutions when we were filed with the lawsuit.
23
A. Yes.
23
Q. At the time the lawsuit was filed, however, the
24
Q. Have you had any discussions with any of the
24
city had imposed restrictions on the development in light of
25
folks, engineering -related folks or the city attorney or
25
these issues. Correct?
74
76
1
anybody else — and I'm setting aside litigation counsel —
1
A. Yes, as soon as we became aware of the problem.
2
but have you had any discussions about what the possible
2
Q. Since those discussions and the commencement of
3
fixes are?
3
the lawsuit, setting aside discussions with your litigation
4
A. Yes, we have.
4
counsel, of course, have you had any other discussions about
5
Q. Can you tell me what your understanding of
5
possible resolutions or ways to solve the problems as the
6
those possible fixes are?
6
city views them with the development?
7
A. 1 sat in on some meetings with the builder and
7
A. No, not that I'm aware of.
8
Gold Key where options were pursued to, you know, to
8
Q. Until your discussion with Ms. Matt, you talked
9
continue the construction. 1 believe one of them was that
9
about Prairie Run being somewhat of a different type of
10
the homeowners or the builder, the owner of the home now,
10
platted development because you described it as it was a
11
the builder would sign off that they acknowledge they don't
11
city project. Do you recall that testimony?
12
have the freeboard to meet the ordinance.
12
A. Yes.
13
One of the other more extreme measures would be
13
Q. What did you mean by a "city project"?
14
to bring the development into compliance with the ordinance
14
A. Normally, the typical development like this,
15
by raising all of the infrastructure, i.e., roads and
15
the developer would enter into a development agreement and
16
hydrants and raising the development, also to Incorporate
16
they would secure their own contractors and do all of the
17
adequate storm water ponding to contain the water that comes
17
work. In this case, it required the cooperation of
18
from the development and not have it so Ditch 9 inundates
18
adjoining landowners, and it appeared that the only way this
19
that prior to I think the 100-year.
19
project would go forward is if the city provide a mechanism
20
So in summary I guess we've worked with the
20
to assess and provide some interim financing and get the
21
developer to try and find some, you know, low cost solutions
21
parties all working together, and so the city was the
22
and ultimately more comprehensive solutions.
22
conduit to bring this project together, and so rather than
23
Q. What was the net result of those? Obviously —
23
the developer having his own private contractor doing this
24
you're saying this must have occurred prior to the
24
work, It was a city project.
25
litigation; is that right?
25
Q. So in this development, that is, the Prairie
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 73 through 76 of 176
Larry Kruse, Marcrl 13, Zuu7 20
77
79
1
Run development, the city played a more active role than it
1
in conformance with city ordinances?
2
would in typical platted developments. Is that what you're
2
A. 1 think City Attorney Court did a good job and
3
saying?
3
the council is satisfied with the work he's done.
4
A. Yes.
4
Q. I think I know the answer as to SEH, but in
5
Q. You testified a number of times earlier about
5
this situation, do you have any concerns that SEH failed to
6
the high expectations you have or the city has with respect
6
perform in its review of the plat as it should have based on
7
to outside consultants and employees; is that right?
7
your expectations?
8
A. Yes.
8
A. Yes.
9
Q. And when I heard your prior testimony, I noted
9
Q. Since you have been the city administrator for
10
you clearly have SEH, which is the outside engineering
10
the City of Albertville, has the city conducted any other
11
consultant that you use. Correct?
11
flood calculations as of the type that were done by Bolton
12
A. Yes.
12
Menk in the Ditch 9 flood study anywhere else in the city?
13
Q. You have the city planner, which is Northwest
13
A. Ditch 9 also involved the Albert Villas, so not
14
Associate Consultants, correct, and they act as the city ,.
.14
that I'm aware of.
15
planner?
15
Q. How about having developers do a broader
16
A. Yes.
16
watershed calculation as part of the development to
17
Q. And you have the city attorney, who is an
17
determine the 100-year flood level? Have you asked any
18
outside counsel; is that correct?
18
other developers in any other developments in the City of
19
A. Yes.
19
Albertville to do a 100-year flood calculation looking at a
20
Q. Are there any other outside consultants that
20
larger watershed than their development?
21
the city looks to as part of the platting process?
21
A. I don't know -- I'm not aware of any, but my
22
A. No.
22
expectation is that when you develop a project, you have to
23
Q. In your discussion about the city consultant,
23
look at all of the Issues around the property and take them
24
you indicated that you had an expectation that the city
24
into consideration.
25
planner would also be reviewing the plat for conformance in
25
Q. Well, my question was different than that, sir.
78
80
1
relation to city ordinances; is that right?
1
My question was, Are you aware of any developments that you
2
A. Yes.
2
have been involved in in the City of Albertville where the
3
Q. In this case, do you know whether the city
3
city has required a developer to look at and determine a
4
planner reviewed the plat as approved and confirmed that
4
100-year flood level based on a watershed that is larger
5
it's in conformance with city ordinances?
5
than their development?
6
A. That would be when he makes his recommendation,
6
A. In northwestern Albertville they did a —1
7
1'd make that assumption, yes.
7
forget the name of the document that is a preplanning
8
Q. And in this case, do you know or do you have
8
document for future development, kind of a preenvironmental
9
any perception that the city planner did not adequately
9
impact statement. The name slips me right now. You know,
10
review the plat in light of the requirements of city
10
believe that may have, you know, been — looked broader than
11
ordinances?
11
just the City of Albertville, but I'm not sure.
12
A. No, I don't. No.
12
Q. "They," being Bolton Menk, or "they' being the
13
Q. Put another way, do you have the belief that
13
developer? I lost pe . you on the pronoun.
14
the city planner in any way dropped the ball as part of
14
A. Since I've been there -- I'm not aware of any
15
their review of the preliminary plat and final plat approval
15
that come to mind right now.
16
in this process?
16
Q. One of the logical reasons to have a city
17
A. I don't believe they dropped the ball.
17
perform that sort of function, that is, that broader
18
Q. Same question for the city attorney. I believe
18
analysis, is because the properties impacted are often
19
your testimony was that you understood that the city
19
beyond the relatively small number of properties impacted in
20
attorney would be reviewing the plat, making sure it's in
20
the development itself; isn't that right?
21
conformance with the ordinances; is that right?
21
A. Yes.
22
A. That's right.
22
Q. So, for example, here in Bolton Menk, the
23
Q. And in this case, do you have any understanding
23
Bolton Menk study looked at a watershed of some 2300 acres,
24
or belief that the city attorney did or should have engaged
24
which is many times larger than the Prairie Run development;
25
in a more detailed review of the plat to ensure that it was
25
is that right?
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 77 through 80 of 176
Larry Kruse, March 13, 2007
21
81
83
1
A. Yes.
1 and so forth. Correct?
2
MR. YOCH: Thank you, sir. No more
2 A. Yes.
3
questions.
3 Q. Why did you characterize that as an extreme
4
A. Just going back, the term AUAR was the term,
4 measure?
5
one of the previous questions.
5 A. I should say it's an expensive measure.
6
Q. AUAR? I'm sorry, what was my question that
6 Q. Have you done an assessment of what it would
7
you're answering now?
7 cost, or do you have a ballpark?
8
A. Regarding any other studies where we may have
8 A. No.
9
looked at a broader drainage area, and that was pre my time.
9 Q. But you are aware that you're talking millions
10
Q. Okay. The AUAR study in Northwestern
10 of dollars? You're not just talking $10,000. Correct?
11
Albertville was the name of the study; is that right?
11 A. No, I'm not aware of the number.
12
A. That's an area —
12 Q. Well, I'll represent to you that we've had
13
MR. KUBOUSHEK: It's a term of art.
13 engineers testify that it would be a multimillion dollar
14
MR. YOCH: I think I remember Mr. Nafstad .
14 fix.
15
talking about that.
15 A. I just say that I don't think the whole project
16
BY MR. YOCH:
16 was that much, so 1 couldn't quite understand it would be
17
Q. And is that a study that was done by Bolton
17 that much, but I have no number.
18
Menk?
18 Q. If it would be a multimillion dollar fix, it
19
A. No. That was a study initiated by a developer
19 wouldn't be fair to make the developer go back and correct
20
that was proposing a development.
20 that, would it?
21
MR. YOCH: Thank you, sir.
21 A. I think it would.
22
22 Q. When it was the city engineer who failed to
23
CONTINUED CROSS-EXAMINATION
23 review the problems, you think the developer -- or, excuse
24
BY MS. MATT:
24 me, review the plans, you think the developer should have to
25
Q. Mr. Kruse, you said the approved plat of
25 pay multimillion dollars to raise the infrastructure?
82
84
1
Prairie Run was too low and does not meet the intent of the
1 A. From my experience, it's the design engineer's
2
city's ordinances. Correct?
2 job to design It right. And our city engineer does a
3
A. Yes.
3 review, doesn't, you know, go do another whole engineering.
4
Q. Whose fault is that?
4 It is a review.
5
A. My expectation Is that the developer develops
5 Q. So the city engineer would —should also bear
6
the plans and our city engineer reviews, so probably both.
6 some of whatever the cost is to fix these alleged problems,
7
Q. Well, in this case, in the case of Prairie Run,
7 in your opinion?
8
the developer's plans were never reviewed by the city
8 A. I don't know.
9
engineer. Correct?
9 Q. Well, didn't you just say that the city
10
A. Right.
10 engineer was at fault for the approved plat being too low
11
Q. And so how is it that it is the developer's
11 and not meeting the intent of the ordinances?
12
fault that the approved plat is too' low and does not meet
12 A. If I have to clarify that, I would say that the
13
the intent of city ordinance?
13 city engineer erred in not reviewing it.
14
A. I guess it would be my understanding that it's
14 Q. Okay. And so shouldn't the city engineer bear
15
the developer's responsibility to engineer the project in
15 some of the cost of whatever the fix to this alleged problem
16
compliance with all the codes and so it functions. And the
16 is?
17
city engineer doesn'tredesign or redevelop it. It reviews.
17 MR. MARKERT: I'm going to object to the
18
And so ultimately I think that the developer's engineer is
18 extent it calls for a legal conclusion.
19
responsible to do the job right from the get -go and If our
19 Q. Go ahead.
20
city engineer didn't review it, you know, the city erred in
20 A. I don't know. I don't know.
21
not doing that too.
21 Q. Who do you think should pay to fix these
22
Q. You told Mr. Yoch that one of the
22 problems that the city is identifying with the Plat of
23
considerations or options I guess that you discussed was
23 Prairie Run?
24
what you called an extreme measure, bringing the
24 A. You know, I guess I can say that I don't think
25
infrastructure into compliance by raising roads and ponds
25 the city should pay. Obviously these lawsuits, you know,
Kirby A. Kennedy &Associates 952-922-1955 1-800-545-1955
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Larry Kruse, March 13, 2007
1
85
will bear out who is responsible.
1
22
87
plans, and now I'm wonderingand — you answered that the
2
Q. Why is it that you think the city should not
2
city would not have to specifically direct the city
3
have to pay anything?
3
engineer, is that right?
4
A. I think, you know, we worked through this with
4
A. Yes.
5
all due diligence and took all the steps we normally take.
5
Q. And now I'm wondering specifically with respect
6
We have all of the high expectations with all of our
6
to the preliminary plat of Gold Key, did the city council —
7
developments and apparently this review on our side was
7
or the cityhave an expectation that it needed to direct the
8
missed, so I think, you know, we acted with good intent and
8
city engineer to review the preliminary plat documents with
9
the city in its approvals did not make any mistakes.
9
respect to grading and drainage and engineering issues?
10
Q. Except approving a plat that hadn't been
10
A. The city council gives the broad, you know,
11
reviewed by the city engineer. Correct? That's a mistake.
11
10,000 foot direction, and our expectations are that, you
12
A. At the time it was unknown that that didn't
12
know, all of our consultants do their due diligence, and
13
happen.
13
they fully understand, you know, what it takes to do a good
14
Q. Right. But it's a mistake nonetheless.
14
project, so they would expect that.
15
A. in hindsight, looking back on it, yes, it would
15
Q. So the answer is, no, the city did not expect
16
not have been approved had it not been reviewed and received
16
that it would have to specifically tell SEH that it needed
17
the recommendation of our consultants.
17
to review the grading, drainage plans, and other engineering
18
Q. Mr. Kruse, when we took the previous break, 1
18
aspects of the Prairie Run preliminary plat documents?
19
was asking you about whether there was any other discussion
19
A. Yeah. We did not have to specifically give
20
at the June 7th, 2004, city council meeting, where the final
20
direction in order for that to happen.
21
plat had been approved, and I think, if I'm understanding
21
Q. Your expectation was that the engineer would
22
your testimony correctly, you testified that you thought
22
review the Gold Key preliminary plat submissions and let the
23
there was some other discussion that wasn't reflected in the
23
city know if there was a problem with them?
24
minutes, and then you clarified that you were making the
24
A. Yes.
25
assumption that there was some discussion. Correct?
25
Q. And the city engineer at that time was SEH?
1
86
A. You know, I don't remember the specifics of
1
88
A. Yes.
2
that discussion or anything. When i look at the minutes, it
2
Q. Did SEH make the city aware of any problems
3
looks like that is the culmination of, you know, a process
3
with the preliminary plat documents submitted by Gold Key
4
the council went through over a period of time, and there
4
for Prairie Run —
5
may or may not have been discussion.
5
A. Not that I'm aware of.
6
Q. Are there any documents out there that will
6
Q. -- with the grading and drainage plans that
7
help you recall whether there was specific discussions other
7
were submitted?
8
than what's reflected in these June 7, 2004, city council
8
A. Not that I'm aware of.
9
minutes?
9
Q. Did SEH make any of the city consultants,
10
A. There may be. I'm not aware of what they are.
10
either the city planner or the city attorney, aware of any
11
Q. But as we sit here today, you're not aware of
11
problems with the preliminary plat documents submitted by
12
any other documents that would help you remember?
12
Gold Key for Prairie Run?
13
A. No.
13
A. Did the city —who now?
14
Q. And you've provided all the documents relating
14
Q. I'm wondering if — I had previously asked you
15
to this file, the Prairie Run file, to your counsel?
15
if SEH made the city aware of any problems with the
16
A. As far as I know, yes.
16
preliminary plat documents. You answered no. Now I'm
17
Q. And on June 7th, 2004, at that city council
17
wondering if SEH made the city consultants, either NAC or
18
meeting when the city approved the final plat of Prairie
18
Mr. Couri's office, aware of any problems with the
19
Run, you assumed that review and approval had been given by
19
preliminary plat documents.
20
the city engineer?
20
A. No.
21
A. Yes.
21
Q. As we sit here today, do y you believe that SEH
22
Q. Mr. Kruse, I think I just asked you in general
22
reviewed the grading and drainage plan documents submitted
23
during the preliminary plat process about whether the city
23
by Gold Key prior to the time the final plat was approved?
24
had an expectation that it would have to direct the city
24
A. Yes, that would have been our expectation.
25
engineer to specifically review the grading and drainage
25
Q. I'm asking you if they did in fact do that, if
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Pages 85 through 88 of 176
Larry Kruse, March 13, 2007
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89
1 SEH in fad did that.
91
1
2 A.
plat meets all of the ordinance requirements.
Maybe in some of the discussion here I've
2 Q. So your testimony is now that you believe SEH
3 learned that they haven't done it. Is that what you're —
3
4 Q.
did make a recommendation for approval of the plat? Is that
I'm wondering as we sit here today, do you
4 what you're saying?
5 believe that SEH reviewed the grading and drainage plans of
5 A.
6 Prairie Run?
Our team, and I'd have to go back to, you know,
7 A. I've been told that they haven't.
6 when we -- I think we operate as a, you know, city planner,
8
7 city attorney, city engineer, are all involved in this
(At this time Mr. Yoch left the deposition
8 process, and when a recommendation comes forward,
9 proceedings.)
10
9 everybody
ry y —all of the other people believe that the other
Q. Who have you been told that by?
10 consultants and individuals have done their due diligence
11 A. You know, I'm not sure where that came from.
11 and are making a recommendation, and if they felt something
12 Q. Okay. So as we sit here today, you don't
12 wasn't done, they'd be bringing it to my and the council's
13 believe SEH ever reviewed the grading and drainage plans
13 attention.
14 that were submitted by Gold Key as part of the plat of
14 Q: Do you believe SEH dropped the ball somewhere
15 Prairie Run. Correct?
15 and in fact failed to make the review?
16 A. It goes back to my expectation would be when
16 A. That's what I'm hearing.
17 the recommendation was made that they were reviewed. And
17 Q.
18 there's — I've been told that somewhere along the line that
You're hearing it, but do you believe it?
19 they didn't do the review. That's secondhand information,
18 A. If they didn't do the review, if that's what
19 happened, then, yes, they did.
20 so I haven't seen anything, you know, specifically saying
20 Q. And do you believe that they did do the review?
21 they didn't do their review. 1 haven't talked to them and
21 A. I have to think back. It goes back to what my
22 got that from them.
23 Q.
22 expectations would have been. Yes, we would have all
So as we sit here today, do you believe they
23 expected them to do the review.
24 reviewed those documents or not, the preliminary plat
24 Q. Okay. And 1 understand that. You didn't see a
25 grading and drainage plans?
25 review memo in the file, though. Correct?
90
1 A. You know, once again, I go back to my
92
1 A. I haven't seen one, no.
2 expectation that that would be what they should have done.
2 Q. Who is tellingyou that SEH didn't do the
3 Q. And I understand that. I'm asking if you
3 review?
4 believe that they ever did that, if SEH ever reviewed the
4 A.
5 grading and drainage plans. Do you believe they did that?
You know, I think that that probably came out
5
6 A.
with our discussion with our attorney during the - prior
I guess I have a hard time answering that
6 to — probably in the last week or so.
7 because my expectation is they would have.
7 Q. So at the time of final plat approval,
8 Q. Right. And I understand that.
8 June 7th, 2004, did the city believe that the review of the
9 A. I don't know — you know, I haven't seen any
g grading and drainage plans of Prairie Run had been done?
10 work product or anything that says that they haven't. I've
10 A. Yes.
11 heard it mentioned. That's the only Information I have is
11 Q. By SEH?
12 that it's been mentioned that they haven't, missed the
12 A. Yes.
13 review.
14 Q.
13 Q. And so it was reasonable, then, for Gold Key
So do you believe that they reviewed the
14 and Hedlund to assume as of that date, June 7th, 2004, that
15 grading and drainage plans? Yes or no.
15 the grading and drainage plans had been reviewed by the city
16 A. I would say yes.
16 engineer. Correct?
17 Q. Okay. When did SEH review the grading and
17 A. Yes.
18 drainage plans?
18 Q. Did you have an expectation that either someone
19 A. Prior to making their recommendation for
19 from Gold Key or someone from Hedlund would stand up at the
20 approval.
20 June 7th, 2004, meeting and say, "I want documentation to
21 Q. When did SEH make a recommendation for
21 prove that these grading and drainage plans had been
22 approval?
22 reviewed"?
23 A. You know, when the preliminary plat and the
23 A. No.
24 final plat, all of that comes through the process, our
24 Q. That wouldn't have been normal or typical that
25 consultants as a team are making a recommendation that the
Kirby A. Kennedy & Associates
25 a developer would stand up and demand proof for his file?
952-922-1955 1-800-545-1955 Pages 89 through 92 of 176
Larry Kruse, March 13, 2007
24
93
95
1
A. No.
1
Q. Would it be fair to say that you learned that
2
Q. So would you agree that it was reasonable for
2
SEH hadn't reviewed the grading and drainage plans just as
3
Gold Key and Hedlund to assume that because they did not
3
part of this litigation process?
4
receive comments back from the city engineer as to any
4
A. Yes. Yes.
5
deficiencies with their grading plans, that those documents
5
Q. Do you recall being present at a meeting in
6
were satisfactory to the city?
6
November of 2005 with Bob Moberg, Jon Sutherland, Randy
7
MR. KUBOUSHEK: Object to the form of the
7
Hedlund, and Dean Johnson about grading issues?
8
question. Lacks foundation. Asks him to assume what the
8
A. I don't remember a speck date or anything.
9
developer and design engineer were thinking.
9
1 recall having some meetings with those parties.
10
Q. Go ahead and answer.
10
Q. What do you recall about those meetings?
11
A. Usually an approval means that things are in
11
A. You know, I don't recall any — the specifics
12
order.
12
of, you know, which one you're referring to or anything, but
13
Q. And so do you believe that it would be
13
1 know that we discussed what might be some acceptable
14
reasonable for Gold Key and Hedlund to assume that because
14
strategies to move forward — exploratory discussions, fact
15
it had not received comments back from the city engineer as
15
finding.
16
to any deficiencies with those grading plans, that they
16
Q. And those are the strategies that you already
17
complied with city ordinances and subdivision ordinances?
17
discussed with Mr. Yoch?
18
MR. KUBOUSHEK: Object to the form of the
18
A. Yes.
19
question. Lack of foundation. Asks him to assume what the
19
Q. Okay. What do you mean "fact finding"?
20
developer and design engineer thought.
20
A. Well, I think as you go through this whole
21
Q. Go ahead.
21
process, there's information that gets exchanged and
22
A. Yes.
22
dialogue.
23
Q. Is there anything that Gold Key should have
23
Q. Did you find out any facts at these meetings?
24
done as part of the plat approval process that it did not
24
A. You know, I don't know any specific facts. I'm
25
do?
25
just talking. I'm just saying that these meetings were
94
96
1
A. I guess I don't know.
1
exploratory. Information was shared. There was dialogue.
2
Q. Anything that you can think of that Hedlund
2
Maybe I'm using the wrong term "facts." There was dialogue.
3
should have done as part of the plat approval process that
3
Q. Do you recall at that meeting Randy Hedlund
4
it did not do?
4
receiving for the first time a document, the culvert
5
A. Maybe looked at maybe Ditch 9 a little closer,
5
analysis document?
6
what directly abuts the improvement
6
MR. KUBOUSHEK: it's right here
7
Q. And you'd agree that if the city or its
7
(indicating).
8
engineers had information about Ditch 9 that abuts the
8
Q. Do you recall that being given to Mr. Hedlund?
9
development, that they should have shared that information
9
A. I don't recall seeing this specific document,
10
with Hedlund. Correct?
10
so, as I stated earlier, I saw maybe some type of another
11
A. It would be my assumption that we would share
11
letter in the material, exhibits.
12
whatever information we could to make a better development
12
Q. Do you recall any discussions about the culvert
13
Q. Is there a particular point in time that the
13
assessment in those meetings -- culvert risk assessment
14
city learned that SEH did not review the grading and
14
document, Exhibit 65, that's in front of you, do you recall
15
drainage plans submitted as part of the Prairie Run
15
discussions about that in those late 2005 meetings that
16
development?
16
you're talking about?
17
A. I can't think of a specific time.
17
A. Once again, the timing of it, the dates I'm not
18
Q. In general?
18
sure of, but I remember they had discussions about this
19
A. Recently, like I say, I heard — and I don't
19
which I was listening to.
20
remember exactly who said it — but that that was missed.
20
Q. And when you say "they," you mean the engineers
21
We knew for a while now that there was a problem, but, you
21
and developer?
22
know, I did not know that it wasn't reviewed, and I don't
22
A. You know, there was a number of meetings, and
23
know even today if there was, you know, a small review or an
23
once again, Dean Johnson was involved in some, Randy
24
all -encompassing review wasn't done. I don't have that
24
Hedlund, Bob Moberg.
25
information.
25
Q. And they were having discussions about the
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 93 through 96 of 176
Larry Kruse, march 13, 2007
97
99
1
culvert risk assessment and the 100-year number in there?
1
A. That's what 1 recall.
2
A. There were discussions about that, yes.
2
Q. And do you recall that he used that because a
3
Q. What were the discussions about that?
3
100-year number was not made available to him?
4
A. I think it all, you know, with that
4
A. Yeah, that's what I would assume.
5
information, it showed that the elevation of the development
5
Q. Mr. Yoch asked you a question about who was
6
was low and Hedlund debated, you know, what was their
6
making the decision on which lots were okay to build on and
7
interpretation of the ordinance, and our city engineer gave
7
which lots weren't okay. Do you recall that?
8
his interpretation.
8
A. Yes.
9
MR. MARKERT: Excuse me, which city
9
Q. And I believe that you testified the city
10
engineer are you referring to?
10
engineer made those decisions; is that right?
11
THE WITNESS: You know, my memory gets
11
A. You know, the city engineer was very involved
12
mired. For the most part, Bob Moberg was working on this
12
in review and, you know, looking at all of those issues. At
13
project, but also Adam Nafstad was on the periphery of that.
13
some point it did Involve, you know, ordinance
14
The majority, of the time.we tried to keepSEH
- 14
interpretation, and 'sa our city aftomey was also Involved
15
involved in projects where they were -- it was a
15
in some of the discussions and as our city planner. We
16
continuation of something that was already ongoing, whereas
16
operate as a development team, and this was a big problem,
17
Bolton & Menk took over new projects.
17
so everybody was involved.
18
However, as building permits and stuff were
18
Q. 1 guess the -- what I am trying to figure out
19
being issued, Bob Moberg wasn't always available or we
19
is which city engineer is making the decision as to whether
20
looked to our new city engineer to provide some guidance, so
20
particular lots can get a building permit or not. We, in a
21
at that point in time there was a crossover. So it could
21
previous deposition, I'll represent to you that Adam Nafstad
22
have been — you know, some of those discussions could have
22
of Bolton Menk said that Bob Moberg made the decision. And
23
involved -- early on they all involved SEH, and after Bolton
23
Moberg in his deposition said, no, he wasn't making the
24
& Menk was on for a period of time in, you know, I don't
24
decision, so I'm trying to figure out who was making the
25
know the recent date, the past year, 18 months, Adam Nafstad
25
decision as to particular lots.
98
100
1
became more involved in the building permits, the issuance
1
A. You know, I think there's probably some gray
2
of them.
2
area. If you're talking about In recent times our city
3
BY MS. MATT:
3
engineer Adam Nafstad was, since litigation and all of that,
4
Q. Do you recall during those meetings that
4
was probably the person carrying that message. In the early
5
happened with the engineers and the developer that
5
days, SEH, when Bolton Menk came on, SEH was in charge of
6
Mr. Johnson and Mr. Hedlund were surprised about that
6
the Prairie Run project, and we tried our best to keep
7
information regarding the culvert 100-year level?
7
Bolton Menk working on new things and not projects that were
8
MR. MARKERT: I'm going to object. Calls
8
underway. But there were times where I would say there's
9
for speculation.
9
some gray area where we were expecting SEH to continue with
10
Q. Go ahead and answer.
10
the project and we had a new city engineer under contract
11
A. I don'tremember.
11
with us, and I can just describe it as I can see where
12
Q. Do you remember Mr. Hedlund or Mr. Johnson
12
there's some gray area in between there.
13
making comments that they had never seen this 100-year —
13
Q. You indicated that prior to the lawsuit by Gold
14
seen or heard about this 100-year level associated with the
14
Key you were -- you believed the city and Gold Key were
15
culvert?
15
working towards an acceptable solution. Is that a fair
16
A. 1 don'tremember.
16
summary of your testimony?
17
Q. Is it possible that they made those comments
17
A. I think we were having some healthy discussion,
18
during those meetings?
18
and 1 think with continued discussions, you know, prior to
19
A. it's possible, yes.
19
the lawsuit, we were heading towards some what would have
20
Q. And you said that Mr. Hedlund debated his
20
been maybe some acceptable solutions.
21
interpretation of the ordinance. Correct?
21
Q. So what would be an acceptable solution in your
22
A. There was discussion about the ordinance, yes.
22
mind?
23
Q. And Mr. Hedlund's position was that he had used
23
A. You know, ultimately we want to protect the
24
the line of permanent aquatic vegetation as the governing
24
homeowners that are there. We want that if a home is built
25
benchmark?
25
with inadequate freeboard, we want them to know what they
<irby A. Kennedy & Associates 952-922-1955 1-800-54
1955 Pages 97 through 100 of 17
2fi
Larry Kruse, March 13, 2007
26
1
101
have. The city doesn't want to see a residence flood after
1
103
me if you recognize it?
2
they purchase a home.
2
A. (Witness complies.) I have seen this, yes.
3
One of the suggestions was that on some of the
3
Q. And it's a letter from Mr. Robert Moberg to
4
marginal homes with — and I don't know the amount of
4
Mr. Coud, dated November 23rd, 2005; is that correct?
5
freeboard that might be acceptable, but it sounded like
5
A. Yes.
6
there might be a way to comprise on some of the freeboard if
6
Q. And you are copied on it, as is Jon Sutherland
7
the homeowner signed an indemnity or, you know, something
7
and Mark Kasma?
8
that would be passed on to future homeowners so everybody
8
A. Yes.
9
would know what they're getting.
9
Q. In the first paragraph of that letter, it
10
And then also it was discussed that probably
10
states, "At the request of the City of Albertville, SEH has
11
some homes that might have had basements would be converted
11
prepared a summary of issues to be resolved by the developer
12
to slab on grade and some of the elevations of the homes
12
for the residential portion of the Prairie Run project."
13
raised so that they met the requirements of the ordinance.
13
Who at the City of Albertville requested that SEH prepare
14
Q. ..Did the city have an expectationthat•the
14
this?
15
infrastructure of Prairie Run, that is, the roads themselves
15
A. Possibly it was the council.
16
and the ponds will be or need to be raised?
16
Q. The council as in city council or as in --
17
A. The council ultimately makes that final
17
A. City council.
18
decision, and I hate to predict what would be acceptable to
18
Q. Not Mike Couri?
19
them. I think that that's a possibility. I would hope that
19
A. You know, i guess I don't know for sure who
20
there would be something, you know, that might lessen that.
20
would have requested it. You know, there may have been an
21
Ultimately we have to look at those homeowners and make sure
21
update of Prairie Run at the council meeting, and they might
22
that they're protected from a 100-year event.
22
have said to pursue this.
23
Q. Wouldn't the time to have done that be before
23
Q. Okay.
24
the city approved the plat?
24
A. I don'tknow.
25
A. Definitely.
25
Q. Okay. And that first sentence also says, "SEH
102
104
1
MR. KUBOUSHEK: Are we at a point where
1
has prepared a summary of issues to be resolved by the
2
we could take a quick break? Or I don't know what your plan
2
developer." Why is it at that point that you were -- that
3
for the day is.
3
the developer should resolve the issues?
4
MS. MATT: I have a lot more.
4
A. As I recall, the developer did the design of
5
MR. KUBOUSHEK: Do you want to take a
5
the lots and the storm water ponds on that residential
6
lunch, or how do you want to handle it?
6
portion, and that would be the person — the entity we have
7
MS. MATT: I don't need lunch, but I know
7
the development agreement with.
8
you guys typically need lunch.
8
Q. Okay. And at that point, in November of 2005,
9
MR. VAN DER MERWE: I'm fading fast.
9
were you aware that SEH had in fact not reviewed the grading
10
MR. KUBOUSHEK: Should we say 45 minutes?
10
and drainage plans that were submitted as part of the plat
11
Does that work?
11
of Prairie Run?
12
MS. MATT: Sure.
12
A. No.
13
(At this time a recess was taken.)
13
Q. So at that point you didn't believe SEH had to
14
(At this time Larry Kruse Deposition Exhibit
14
resolve the problems, had any responsibility to resolve the
15
Number 96 was marked for identification by the
15
problems at Prairie Run?
16
Court Reporter.)
16
A. That's correct.
17
BY MS. MATT:
17
Q. When did SEH make you aware that it had not
18
Q. Mr. Kruse, in the normal plat process, would
18
reviewed the grading and drainage plans?
19
you expect that any deficiencies or errors in the grading
19
A. I guess i really learned about it during this
20
and drainage plans would be commented on by the city
20
litigation and some recent depositions that, you know, from
21
engineer and corrected by the time it got to final plat
21
Pete Carlson.
22
approval?
22
Q. So people from SEH attended these 1 guess I've
23
A. Yes.
23
been calling them brainstorming meetings that you had with
24
Q. Okay. Handing you what's been marked as
24
various members of Gold Key and Hedlund and people from the
25
Exhibit 96, could you take a look at that document and tell
25 city to come up with solutions to these problems that the
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 101 through 104 of 176
Larry Kruse, March 13, 2007
1
105
city was identifying. Correct? SEH representatives were
1
27
107
somewhere in the fall, late fall of 2005.
2
there?
2
Q. Okay. And in fact Mr. Moberg is the author of
3
A. Yes.
3
this letter of Exhibit 96. Correct?
4
Q. Bob Moberg?
4
A. Yes.
5
A. Yes.
5
Q. And he's writing, "After several recent
6
Q. Was Pete Carlson at any of those meetings? He
6
rainfall events, it has been discovered the grading plan for
7
had left by then?
7
the site does not account for the 100-year flood elevation
8
A. I don't recall Pete being at any of those
g
(calculated at 951.5 by Wright County) of an existing box
9
meetings.
9
culvert where County Ditch Number 9 passes under Jason
10
Q. And during any of those meetings, those
10
Avenue"?
11
brainstorming type meetings, did Bob Moberg stand up and let
11
A. Yes, that's what It says.
12
you know that SEH hadn't in fact reviewed the grading and
12
Q. Did you have discussion with Mr. Moberg any
13
drainage plans for Prairie Run?
13
time around then, around this November 23rd, 2005, about
14
A. Not that I'm aware of, no.
14
when he had discovered that 951.5 elevation?
15
Q. The second paragraph of — is it Exhibit 96
15
A. I didn't, no.
16
that you're reading from?
16
Q. in the third paragraph of Exhibit 96, it refers
17
A. Yes.
17
to City Code 11-7-5G. Do you see that?
18
Q. The second paragraph of Exhibit 96 refers to
18
A. Yes.
19
recent rainfall events. It says, "After several recent
19
Q. Is there another number for it? I'm having a
20
rainfall events, it has been discovered the grading plan for
20
hard time matching up all these ordinances. The ordinances
21
the site does not account for the 100-year flood elevation
21
I've seen are like 600, 700, 1000. Does that tell you
22
(calculated at 951.5 by Wright County) of an existing box
22
something right there, city code --
23
culvert where County Ditch Number 9 passes under Jason
23
A. I'd have to research that. I don't know.
24
Avenue." Do you see that?
24
Q. Did the city code used to have like an old
25
A. Yes.
25
numbering system or something?
1
106
Q. Do you know what rainfall events are being
1
108
A. We codified our code in this time frame here,
2
referred to there?
2
so there has been a change.
3
A. I don't know the dates or anything, but we In
3
Q. Just in the — what you were numbering it as?
4
recent, since my tenure there, we've had two significant
4
A. No. All of the city went through in the
5
rainfalls where there's been some threatening flooding.
5
codification process and reviewed, you know, a large number
6
Q. And there was one in — well, if it's saying
6
of ordinances, updating them.
7
"several recent rainfall events," does that lead you to
7
Q. But you have a document that could tell me
8
believe it was rainfall in the fall of 2005?
8
specifically what 11-7-5G is?
9
A. Yes.
9
A. Yes, I would think so.
10
Q. late summer, fall of 2005?
10
Q. Or was as of November 23rd, 2005?
11
A. Yes.
11
A. The historical record should show that
12
Q. And is it your understanding that it's at that
12
Q. The next paragraph says, "The city is
13
point that this 951.5 elevation of the box culvert was first
13
requesting resolution of the following issues:" and then it
14
discovered?
14
has three numbered paragraphs. Who came up with those
15
A. Yes.
15
numbered paragraphs, the ideas behind them?
16
Q. You hadn't heard anything about the 951.5 box
16
A. You know, I think that Bob Moberg was obviously
17
culvert before then?
17
instrumental in the development of these, and I don't
18
A. No, I hadn't
18
remember, you know — I think it would have been
19
Q. And Bob Moberg apparently believed that it had
19
substantially Bob Moberg in consultation. Like I said
20
recently been discovered?
20
earlier, we have kind of a development team approach — city
21
MR. MARKERT: I'm going to object. it
21
planner, city attorney, and city engineer. So I believe
22
calls for speculation about what Mr. Moberg believed.
22
that this is the outcome of our team working together.
23
Q. Go ahead and answer.
23
Q. Backing up to the previous paragraph, it says,
24
A. I know that the box culvert elevation was —1
24
"Using the 100-year flood elevation calculated by Wright
25 learned about it in this November time frame, probably
25
County, we have determined there a number of lots in the
Kirby A. Kennedy & Associates 952-922-1955 1-800-
A5-1955 Pages 105 through 108 of 176
March 13, 2007
109
1 Prairie Run development that do not comply with City
2 ordinances requiring that the lowest opening elevation of a
3 building be at least 2 feet above the 100-year flood
4 elevation," and then it goes on to list the speck lots.
5 Do you see that?
6 A. Yes.
7 Q. You thought those specific lots complied with
8 city ordinances when the plat was approved, didn't you?
9 A. Yes.
10 Q. Otherwise you wouldn't have approved the plat.
11 Correct?
12 A. That's correct.
13 Q. And then turning to the second page of
14 Exhibit 96, that paragraph at the top starts off, "As an
15 alternative to mitigating existing non-compliance," and then
16 it goes on to talk about study and having the developer
17 finance a flood study. Do you see that?
18 A. Yes.
19 Q. Was the idea that the developer could pay for
20 the $7500 for the flood study and avoid having to comply?
21 Is that what that meant?
22 A. No. 1 think just what it says there, that
23 there may be the possibility that Wright County's number was
24 a conservative elevation and that with a more extensive
25 study, maybe a better number could have been determined.
110
1 Q. So if the developer finances a study and comes
2 up with a less conservative number, then maybe it wouldn't
3 need to comply, is that right?
4 A. Oh, they always have to comply. I think that's
5 our goal, our standard.
6 Q. But then they wouldn't need to comply with the
7 951.1 number that's referred to in Exhibit 96?
8 A. You know, I guess I don't know the technical
9 aspect of answering that, other than what the engineer is
10 recommending here saying that when they determined -- the
11 county determined that 100-year study, I remember them
12 saying that, you know, they do a pretty abbreviated analysis
13 and that number may be a little higher than if they did a
14 more detailed study.
15 Q. So the idea was to have a more detailed study
16 done to come up with a more accurate 100-year number, is
17 that right?
18 A. Yeah, 1 guess that would be a good way to say
19 it.
20 Q. Mr. Kruse, handing you what's been marked
21 previously as Exhibit Number 39, which is a November 29th,
22 2005, letter from Michael Couri to Mr. Dean Johnson at Gold
23 Key Development, have you seen that letter?
24 A. I believe I have, yes.
25 Q. Okay. And then my quick review of it in
4irby A. Kennedy 8 Associates 952-922-1955
111
1 comparing it to Exhibit 96 that we just talked about, the
2 November 23rd, 2005, letter from Mr. Moberg to Mr. Court, is
3 that it appears that a large portion of Mr. Moberg's letter,
4 Exhibit 96, was cut and pasted and used in this
5 November 29th, 2005, letter from Mr. Court. Would you agree
6 with that?
7 A. It appears that way, yes.
8 Q. In the first paragraph of Exhibit 39,
9 Mr. Couri's November 29th, 2005, letter, I noticed some
10 additional language. In the last two sentences it says,
11 "City staff is of the opinion that this discrepancy occurred
12 as a result of an error in Hedlund's calculation. You may
13 want to verify this with Hedlund." And I did not see that
14 language in Mr. Couri's -= excuse me, Mr. Moberg's letter to
15 Mr. Court. And I'm wondering where that opinion came from
16 that the discrepancy occurred as a result of an error in
17 Hedlund's calculations.
18 A. I guess I can only assume, but I know we once
19 again used the team approach, and our engineer and attorney
20 and planner are at some of these meetings, and I believe
21 Mr. Moberg's letter here is — may be listing out the
22 alternatives, and then this is more of a legal notification,
23 and I don't know what transpired in between. There could
24 have been a meeting, you know, with the developer, and
25 whether this is maybe the result of that, but I guess 1
112
1 couldn't ask you — answer you on 1% who specifically made
2 that
3 Q. Did you direct Mr. Court to put those two lines
4 in there in Exhibit 39, "City staff is of the opinion,"
5 those sentences?
6 A. No, I didn't, but I believe that that would
7 have been the consensus of city staff at the time.
8 Q. The consensus of city staff was that the
9 discrepancy occurred as a result of an error in Hedlund's
10 calculations?
11 A. Yes.
12 Q. What was that based on?
13 A. Our review of the information at the time --
14 the plans, the plat, the building pad elevations, all the
15 information.
16 Q. if there was an error in Hedlund's
17 calculations, that should have been caught by the city
18 engineer during the plat review process. Correct?
19 A. I don't know, you know, all the details of what
20 goes into an engineering review. I know that we expect our
21 engineer to do a thorough review, and, yeah, I would expect
22 that things like that would get caught
23 Q. So you would expect if there was an error in
24 Hedlund's calculations that it would have been caught by SEH
25 during the review process, the plat review process. Is that
1-800-545-1955 Pages 109 through 112 of 1
28
Larry Kruse, March 13, 2007
29
113
115
1
your testimony?
1
Q. I'm just reading the first sentence under
2
A. I would expect them to do due diligence and a
2
Prairie Run Discussion. "City Attorney Couri stated that a
3
high standard of review. Specifically if they review every
3
study of the water flow coming from the north to the east of
4
calculation in there, you know, I don't know if they do
4
the site had been conducted." Do you see that?
5
that, but our expectation would be that a thorough review be
5
A. Yes.
6
done and that, you know, outcomes for a good project would
6
Q. What study is he referring to there?
7
prevail.
7
A. I believe there was a study of the Prairie Run
8
Q. Okay. And my question to you is if there was
8
watershed there.
9
an error in Hedlund's calculations, would you have expected
9
Q. Do you know what one specifically he's
10
SEH to catch that error as part of the review process for
10
referring to on December 19th, 2005?
11
the plat?
11
A. I guess I'd have to look into that a little
12
MR. MARKERT: I'm going to object to the
12
further, but I think it was -- I don't remember If that was
13
extent it calls for speculation about what SEH would or
13
the larger study. There may have been a more confined study
14
would pot have caught.
14
which led into a bigger study of the entire watershed. My
15
Q. Go ahead.
15
initial thoughts are it's probably a more limited study that
16
A. I would hope so.
16
was done.
17
Q. So you would expect that they would catch it?
17
Q. By SEH?
18
A. 1 would want them to, yes.
18
A. It might have been Bolton & Menk.
19
Q. Yes. Okay. You would want them to and you
19
Q. The second paragraph says, "When the county was
20
would expect that they catch it. Correct?
20
doing road work on County Road 18 a catch basin or box was
21
A. We expect a high quality project and with no
21
removed. Prior to the construction if you calculate the
22
problems, so yes.
22
floor level according to the elevations of the plat, they
23
Q. So the answer is yes?
23
appear to be correct." Do you see that?
24
A. Yes.
24
A. Yes.
25
Q. And just so I can clarify, is it your testimony
25
Q. Do you know what that means "prior to the
114
116
1
that those two sentences about the discrepancy occurring as
1
construction"? What does that mean to you?
2
a result of an error in Hedlund's calculations were added in
2
A. I don't know. it's not quite clear to me right
3
there because it was the consensus of city staff based on
3
now.
4
previous meetings?
4
Q. Do you recall what your discussions were about,
5
A. 1 think so, yes.
5
about Prairie Run that night?
6
Q. So Mr. Couri would have added those two
6
A. If 1 read this a little more —
7
sentences?
7
Q. Sure. Go ahead.
8
A. Yes, I believe so.
8
A. (Witness complies.) Yeah, I guess after —1
9
(At this time Larry Kruse Deposition Exhibit
9
don't recall.
10
Number 97 was marked for identification by the
10
Q. Is there any document that will help you
11
Court Reporter.)
11
recall?
12
Q. Mr. Kruse, Exhibit 97 is the city council
12
A. Not that I'm aware of.
13
meeting minutes from December 19th, 2005. Do you see that?
13
Q. A couple paragraphs down it says, "City
14
A. Yes.
14
Administrator Kruse brought to the council's attention that
15
Q. And in the first paragraph there it says City
15
Mr. Johnson has submitted revised elevation plans of the
16
Administrator Larry Kruse was present. Correct?
16
lots." Do you see that?
17
A. Yes.
17
A. Yes.
18
Q. If you could flip to the last page of
18
Q. Why were you bringing that to the council's
19
Exhibit 97, it appears there was a discussion on Prairie
19
attention?
20
Run. Do you see where I am?
20
A. 1 guess I think, you know, we were probably
21
A. Yes.
21
looking at that time for some — maybe some modifications to
22
Q. And it starts out, "City Attorney Couri stated
22
the home designs, i.e., if they have basements or not and if
23
that a study of the water flow coming from the north to the
23
there could be an easy way to raise the elevation of the
24
east of the site had been conducted." Do you see that?
24
house and meet the minimum requirements.
25
A. Pardon? One more time?
25
Q. And Mr. Johnson appeared to be cooperating? He
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 113 through 116 of 176
Larry Kruse, March 13, 2007
30
117
119
1
was submitting revised elevation plans?
1
timing of all the dates when all this came together but —
2
A. Yes.
2
Q. So am I understanding you that if you had known
3
Q. And the next sentence says, "City Attorney
3
that the city's own engineer had not reviewed the grading
4
Couri" — excuse me, in the next paragraph it says, "City
4
and drainage plans, you wouldn't have refused to issue
5
Attorney Couri summarized that city staff has noted a
5
building permits?
6
possible problem with the development and wants to be
6
A. I learned about, you know, just this past few
7
proactive and address the issues before the homes are built
7
days, weeks that — during Pete Carlson's testimony that SEH
8
and problems occur." Do you see that?
8
hadn't reviewed the drainage plan.
9
A. Yes.
9
Q. Okay.
10
Q. What's your recollection of that discussion?
10
A. And so at this time we had no knowledge of
11
A. I think we wanted to make sure that we, you
11
that We assumed that that due diligence was done and we
12
know, weren't issuing additional building permits for homes
12
have to act accordingly.
13
that didn't meet the requirements of the code, and so we
13
Q. So now, sitting here today when you know that
14
wanted to 6e proactive and better understand the situation
14
SEH-did not review the grading and drainage plans, do you
15
through the flood study.
15
think it's fair that you are not issuing building permits,
16
Q. Even though you had already approved the plans
16
that essentially it's the developer and the builders who are
17
over a year and a half ago?
17
being punished? Do you think that's fair?
18
A. Yes. Based on the new information.
18
A. You know, I believe that the city — you know,
19
Q. The pipe guys number? The 951.5?
19
we did everything right. We went through the process.
20
A. Yes.
20
In hindsight, as SEH acknowledged they hadn't
21
Q. Do you think that's fair to the developer that
21
reviewed the plans, our expectation would be that they would
22
the city is not going to issue new building permits based on
22
have reviewed the plans and that the development would
23
the pipe guys number that it apparently recently discovered
23
comply with the ordinance. I guess this whole process here
24
when it had approved the plans over a year and a half before
24
is to determine who was responsible.
25
that date?
25
Q. And is it fair to the builder, the builder and
118
120
1
A. I think our ultimate responsibility is to
1
the developer, that you are not issuing building permits
2
protect current and future homeowners, so when new
2
when the city's own engineer did not review the grading
3
information comes to light, we have an obligation to make
3
plans?
4
sure that we do the right thing to protect them.
4
A. I believe that the city must protect current
5
Q. Even if it's unfair to the builder?
5
and future homeowners and that we must take action to do the
6
A. Yes.
6
right thing today and ultimately it was the developer's
7
Q. And the developer?
7
responsibility to design a project that was compliant with
8
A. They are the responsible party, and we — our
8
the ordinances so we wouldn't be dealing with this today.
9
ultimate responsibility is to make sure that current and
9
Q. Okay. And you still didn't answer my question.
10
future homeowners are protected.
10
Is it fair to the developer? was my question.
11
Q. So they're responsible even though the City
11
A. Yes.
12
gave its stamp of approval when it approved the final plat?
12
Q. Even though the city's own engineer is the one
13
Your testimony is the developer is the one who is
13
who didn't review the plans and catch any alleged mistakes?
14
responsible. Is that what you're saying?
14
A. Ultimately it's rry belief that the designing
15 .
A. I'm saying that the developer hired a design
15
engineer was supposed to deliver an approved quality project
16
engineer to meet the standard of the ordinance, and if It
16
that met our code and ordinances. Our engineer reviews and,
17
comes to light that it doesn't meet that, the city is
17
you know, at the same time if we went to — I'm going to
18
obligated to take action to protect current and future
18
probably generalize this a little bit, but If we went to a
19
homeowners.
19
further extent and redesigned everything and dotted every
20
Q. Even when the citys engineer failed to review
20
"1" that the design engineer, the developer would be
21
the grading and drainage plans and catch any alleged
21
complaining to us about the high engineering fees. And, you
22
mistakes?
22
know, a review is not a redesign, and so our expectation Is
23
A. We didn't know that at that time.
23
that the design engineer delivers a quality project that
24
Q. In December'05?
24
meets the ordinance.
25
A. Yeah,1 mean, once again, I don'tremember the
25
Q. But in your case your engineer did not review
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 117 through 120 of 176
Larry Kruse, March 13, 2007
31
1
121
the plans. Right?
1
123
what's been marked Exhibit 35, it's the development
2
A. Our engineer we've recently learned did not
2
agreement between Gold Key and city. If you could take a
3
review the plans.
3
look at paragraph 13 and confirm for me that that paragraph
4
Q. All right. None of the homes in Prairie Run
4
of the development agreement also allows the developer to
5
have actually flooded, have they?
5
use the line of permanent aquatic vegetation?
6
A. Not that I'm aware of.
6
MR. KUBOUSHEK: I'm going to object to
7
Q. This risk to the homeowners that you're talking
7
the form of the question because it's vague as to time frame
8
about is all a theoretical risk, isn't it?
8
when the developer may use language contained in the
9
A. Based on the amount of rainfall, yes.
9
development agreement.
10
Q. Mr. Kruse, you have before you Exhibit 86,
10
Q. Go ahead and answer.
11
which is a December 20th, 2005, memo from the city attorney,
11
A. If I could just read it just a little bit here?
12
Mike Couri, to Jon Sutherland, yourself, and city council
12
Q. Sure.
13
members. Correct?
13
A. (Witness complies.) Repeat the question?
14
A. Yes. ,.
14
1 . MS."MATT. Could you read my question
15
Q. And the subject line says it's regarding a
15
back, please?
16
"Request For Certificate of Occupancy At 5209 Kalenda
16
(Whereupon the requested portion of the record
17
Court." Do you see that?
17
was read aloud by the Court Reporter.)
18
A. Yes.
18
A. I believe that's what it says.
19
Q. And are you familiar with hat document? You
19
Q. Okay. And then fuming back to Exhibit 86, the
20
received it at some point.
20
third full paragraph down on the second page says,
21
A. Just a moment
21
"Apparently" -- halfway through the paragraph says,
22
Q. Sure. Take a minute to look through it.
22
"Apparently, SEH, the City's engineer reviewing the Prairie
23
A. Yes, I'm somewhat familiar with the document
23
Run plat, assumed that Mr. Hedlund's 948.5 figure took into
24
Q. Okay. On the second page of Exhibit 86, the
24
account the potential flooding situation from County Ditch 9
25
second full paragraph says, "Randy Hedlund, the engineer for
25
when SEH reviewed the plat prior to approval." Do you see
122
124
1
the Developer of the Prairie Run/Gold Key portion of the
1
that?
2
Prairie Run plat concluded that there was no 100-year flood
2
A. Yes.
3
level available and calculated the high water elevation for
3
Q. And so at that point that this memorandum was
4
this plat at 948.5 feet based on the location of the
4
written, December 20th, 2005, am I understanding that the
5
permanent aquatic vegetation." Do you see that?
5
city believed that SEH had reviewed the plat prior to
6
A. Yes.
6
approval?
7
Q. If you'd flip back to the first page of
7
A. Yes.
8
Exhibit 86, there it lists the Zoning Ordinance 1000.9
8
Q. The next paragraph talks about SEH apparently
9
Subdivision (d). Do you see that?
9
recently realizing about the culvert number. And then it
10
A. Yes.
10
states, "While this study was not a comprehensive study, it
11
Q. And in there halfway through it states, "if
11
represents the only information available as to potential
12
sufficient data on known high water levels is not available,
12
flood levels in County Ditch 9." Do you see that?
13
the elevation of the line of permanent aquatic vegetation
13
A. Yes.
14
shall be used as the estimated high water elevation." Do
14
Q. That's not an accurate statement, is it? In
15
you see that?
15
fact, this Exhibit 1, SEH's flood study, was available at
16
A. Yes.
16
this time, December 20th, 2005, wasn't it (indicating)?
17
Q. So it's a fair statement, then, to say that
17
A. It appears by the dates, yes.
18
Mr. Hedlund was justified under the Citys own ordinance in
18
Q. Could you take a look at Exhibit 1, SEH's flood
19
using the line of permanent aquatic vegetation?
19
study, and tell me when you got that? If you flip through
20
MR. KUBOUSHEK: I'm going to object to
20
it, youll notice U's addressed to you somewhere in there.
21
the form of the question in that it assumes what Mr. Hedlund
21
A. (Witness complies.) The letter Is dated to me
22
did or did not know or research. Answer it if you can.
22
June 23rd, 2004.
23
Q. Sure. Go ahead.
23
Q. And actually that flood study that you have in
24
A. Yes.
24
your hand, SEH's flood study, came up with a 100-year number
25
Q. And then in the — Mr. Kruse, handing you
25
of 950.5, didn't it?
Kirby A Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 121 through 124 of 176
Larry Kruse, March 13, 2007
32
125
1 MR. KUBOUSHEK: is there a speck page
1
127
Q. And you expected the builder or someone to do
2 where it's listed? Maybe we can expedite this.
2
that before you issued a certificate of occupancy?
3 Q. On page, Bates stamp B&M 0103, the first table,
3
A. That's what it says here, yes.
4 Kaiser Avenue culvert at County Ditch 9, the first number
4
Q.
5 listed there is 950.5. Do you see that?
Mr. Kruse, before you is Exhibit 69. It's an
6 A. Okay.
5
e-mail from Dan Boxrud of SEH to yourself, copying Bob
6
Moberg, and then the second page of it is a memorandum from
7 Q. Do you understand that to be the 100-year flood
7
Bob Moberg to yourself dated February 14th, 2006. Are you
8 elevation number for the culvert at County Ditch 9?
8
familiar with those documents?
9 A. That's what it says here. I can't read the
9
A. They look familiar.
10 headers on the column.
10"
Q. My question is about the second paragraph of
11 Q. Well, when you got this flood study in June of
11
the first page of Exhibit 69, the e-mail. Mr. Boxrud says,
12 2004, what did you do with it?
12
"As the anniversary of the flood approached" -- and he's
13 A. The city engineer presented it to council,1
13
referring to the 2003 flood -- "the council expressed
14 believe, and as far as the technical numbers, you know,1
14
15 can't verify those here now because I don't profess to be
concern about what had been done in the last year." And I'm
15
wondering if you can tell me what that means.
16 the technical person.
16
A. Could you rephrase the question, please?
17 Q. And when you say the city engineer presented it
17
Q. Sure. I'm wondering ' if you can provide some
18 to council, you mean SEH at that time in June of 2004?
18
insight as to what the following sentence means, "As the
19 A. I believe so.
19
anniversary of the flood approached, the council expressed
20 Q. And did SEH share with you any concerns about
20
concern about what had been done in the last year."
21 the development that city council had just approved, the
21
A. I don't recall. 1 assume that with the heavy
22 Prairie Run development that they had approved a couple
22
rains in the fall of 2004 and some potential flooding, the
23 weeks earlier, June 7th, 2004?
23
council had expressed concerns to make sure that the
24 A. Not that I'm aware of.
24
elevations were accurate and according to the ordinance.
25 Q. Did SEH share with you how this flood study
25
MR. VAN DER MERWE: Excuse me, sir. Did
126
1 might impact the Prairie Run development?
1
128
2 A. Not that I'm aware of.
you mean the rain of 2004 or 2005?
3 Q. Did you share this flood study with Gold Key or
2
3
THE WITNESS: I don't recall. The two
heavy rain events, I'm making the assumption that this
4 Hedlund Engineering?
4
followed that.
5 A. I didn't, no.
5
BY MS. MATT:
6 Q. Were you aware of whether anyone from the city
6
Q. Maybe it would help to read the whole paragraph
7 shared this SEH flood study with Gold Key or Hedlund
7
because I interpreted that paragraph as referring to the
8 Engineering?
8
rain in 2003, so if you would take a minute to read that
9 A. No, I'm not
9
whole second paragraph of Exhibit 69.
10 Q. And, Mr. Kruse, do you understand that as a
10
A. Witness complies.) And repeat the question
11 result of Exhibit 86, the December 20th, 2005, memorandum,
11
one more time, please?
12 the city would not be issuing an occupancy permit for 5209
12
Q. I'm wondering if you know what —well, let me
13 Kalenda Court? If you want to turn to the third
13
try to figure out a better way to ask this. You understand
14 paragraph -- excuse me, the third from the last paragraph of
14
that there was a flood event in June of 2003. Correct?
15 that exhibit.
15
A. Yes, prior to my arrival.
16 A. (Witness complies.) That's correct.
16
Q. Right. And that it's that flood event that SEH
17 Q. At that time were you expecting that the
17
ultimately did a flood study of and that was looked at,
18 builder bring that house into compliance with the ordinance,
18
Exhibit 1. 1 think you might still have it in front of you.
19 that is, raise the house?
19
Correct?
20 A. I believe that was one of the options
20
A. Yes.
21 discussed.
21
Q. You understand that?
22 Q. And are you aware that it was — the builder
22
A. Yes.
23 estimated it would cost $34,000 to raise that house?
23
Q. And do you understand that although SEH issued
24 A. I don't remember the specific number, but
24 Exhibit 1, the flood study report in June of 2004 —
25 that's probably likely.
25
A. Uh-huh.
Kirby A. Kennedy 8 Associates 952-922-1955
1-800-545-1955 Pages 125 through 128 of 176
Larry Kruse, March 13, 2007
33
129
131
1
Q. — it knew the results of that study sometime
1
A. Once again, just what it says. SEH had done
2
prior to the time it issued it. Do you understand that?
2
that internally, and once again, the city is relying on the
3
A. Yes.
3
engineer to, you know, to do their due diligence in
4
Q. And Pete Carlson, was it yesterday — Friday,
4
reviewing these projects, plats.
5
testified that he knew the results of the flood study and he
5
Q. And when it says, "were used to adjust the
6
communicated them to city council in the fall of 2003. Are
6
Prairie Run building elevations upward," do you have any
7
you aware of that?
7
reason to disagree that that happened?
8
A. I don't think so.
8
A. No.
9
Q. Well, I'll represent to you that Pete Carlson
9
Q. The second page of Exhibit 69 refers to a
10
did testify that he communicated the results of the flood
10
meeting on February 7th, 2006. Do you see that?
11
study to city council in the fall of 2003. And now I'm
11
A. Yes.
12
wondering if in light of all of that, this sentence makes
12
Q. Do you recall what happened at that meeting,
13
sense and if you can shed some light on this sentence for
13
who attended and what was discussed regarding Prairie Run?
14
me. "As the anniversary of flood approached, the council
14
A. You know, i don't remember the specifics, no.
15
expressed concern about what had been done in the last
15
Q. Is there any document that will help you recall
16
year." Does that sentence mean anything to you, jog your
16
what happened at that February 7th meeting?
17
memory as to what council was concerned about?
17
A. Not that I'm aware of.
18
A. You know, not really, other than, you know, the
18
Q. Mr. Kruse, handing you Exhibit 72, the
19
2003 flood was such a significant event, it was, you know,
19
feasibility report for 2004 Prairie Run Improvements, have
20
on the forefront of lots of people's minds.
20
you seen that document before?
21
Q. Do you — well, let's go to the sentence that
21
A. Yes.
22
says, "After the 2003 flood, Pete Carlson had our water
22
Q. And it's dated January 13th, 2004?
23
resources staff do the drainage calculations as a check on
23
A. Yes.
24
the approved developments, knowing that the developments had
24
Q. And at that time did the city have an
25
been approved based on developer submissions and without
25
understanding as to whether the grading and drainage plans
130
132
1
benefit of a city-wide study." Does that sentence mean
1
would be reviewed by the city engineer?
2
anything to you?
2
A. As part of our consulting services, we would
3
A. I believe it means that the city didn't have a
3
expect SEH to provide those services.
4
comprehensive citywide study and the developer didn't have
4
Q. And are you aware that after this feasibility
5
the benefit of that knowledge.
5
report was issued there were going to be -- there was going
6
Q. Right. And so the city approved some
6
to be a public hearing on the assessments for the extension
7
developments based on whatever it is that the developers had
7
of I believe 53rd Street? You're aware of that?
8
submitted and without knowing the results of a comprehensive
8
A. Yes,
9
study at that point. Correct?
9
Q. Okay. And Pete Carlson has testified that he
10
A. If I recall, SEH had done, on their own, done a
10
was holding off on reviewing the grading and drainage plans
11
flood study which was eventually brought to council, dated
11
for Prairie Run until after that public hearing happened as
12
June 24th — 25th --
12
to the assessment for the road extension. Does any of that
13
Q. Right. Exhibit 1.
13
sound like something that Pete discussed with you?
14
A. — June 23, 2004.
14
A. I don't remember.
15
Q. And that study you're referring to is
15
Q. Do you — did Pete ever tell you that he was
16
Exhibit 1. Correct?
16
holding off on reviewing the grading and drainage plans
17
A. Yes.
17
until after the public hearing on the assessments for the
18
Q. And are you aware of — let me read another
18
road extension?
19
sentence and ask you a question. In Exhibit 69 it says,
19
A. i don't remember.
20
'The technical results were known to SEH intemally some
20
Q. Is there any document that will help you
21
time in winter of 2003-2004, and were used to adjust the
21
remember?
22
Prairie Run building elevations upward." Do you see that?
22
A. I can't think of any.
23
A. Yes.
23
Q. You're aware that Pete Carlson took a leave of
24
Q. What's your understanding of what happened
24
absence because of the death of his son?
25
there?
25
A. Yes.
Kirby A Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 129 through 132 of 176
Larry Kruse, March 13, 2007
34
1
133
Q. Does it sound right to you that it would have
1
135
A. Yes.
2
been in February of 2004?
2
MS. MATT: Do you to need take a break?
3
A. Yes. Yes.
3
THE WITNESS: What's your best guess now?
4
Q. That's what he testified it was. Okay. And
4
1 have a 3:00 p.m. meeting.
5
were you aware that Jim Schulz was going to be handling the
5
(At this time a discussion was held off the
6
city engineering matters in Pete's absence?
6
record.)
7
A. Yes.
7
(At this time a brief recess was taken.)
8
Q. And was the city okay with that?
8
(At this time Larry Kruse Deposition Exhibit
9
A. Yes.
9
Number 98 was marked for identification by the
10
Q. Did the city have any concern about Jim
10
Court Reporter.)
11
Schulz's ability to handle engineering matters for the city
11
Q. Mr. Kruse, handing you what's been previously
12
in Pete's absence?
12
marked Exhibit Number 84, do you recognize that document?
13
A. No.
13
A. Yes.
14
Q. Did you have any discussions with Jim -Schulz as
14
Q. And it appears to be a September 3rd, 2604,
15
to whether he would be doing a grading — a review of the
15
memorandum from Bob Moberg to yourself regarding preliminary
16
grading and drainage plans for the residential portion of
16
plat review of 2004 Shoppes at Prairie Run. Correct?
17
Prairie Run?
17
A. Yes.
18
A. No.
18
Q. And have you received plat review memorandums
19
Q. Did the city have any problems with Jim Schulz
19
like that on other plats in Albertville?
20
while — and the work that he did while Pete Carlson was on
20
A. Yes.
21
his leave of absence?
21
Q. On most of the other plats that you've been
22
A. I don'tremember any at this time.
22
involved in, do you receive a review memorandum such as
23
Q. Mr. Carlson, handing you — excuse me,
23
Exhibit 84?
24
Mr. Kruse. Handing you Exhibit 75, the city council meeting
24
A. Yes.
25
minutes for April 19th, 2004, do you see that you were
25
Q. So why didn't you notice that a memorandum such
134
136
1
present on that day?
1
as this was missing for the Prairie Run residential plat?
2
A. Yes.
2
A. It's not a required document, and once again,
3
Q. And if you turn to the second page of
3
we would expect our engineer to bring these things forward
4
Exhibit 75, there's a discussion about the 2004 Prairie Run
4
through the process. They're very familiar with that, and 1
5
project. Do you see that?
5
could very easily not have recognized that
6
A. Yes.
6
Q. Okay. On the second page of Exhibit 84, l see
7
Q. And do you see that you, in the third paragraph
7
Mr. Sutherland and Mr. Brixius and Mr. Couri are all copied
8
under that subheading, you are recommending that council
8
on that?
9
adopt a resolution approving the plans and specifications
9
A. Yes.
10
and authorize bidding contingent upon the developer signing
10
Q. Is that fairly typical that they would be
11
the agreement to pay all expenses should the project not
11
copied on a review memorandum?
12
proceed as planned. Do you see that?
12
A. I think so, yes.
13
A. Yes.
13
Q. And did any of those individuals point out to
14
Q. At this point — let me ask another question.
14
you that we were missing a review memorandum for the
15
Do you understand that what you were recommending council
15
residential plat of Prairie Run?
16
adopt was a resolution approving the plans and specs that
16
A. No.
17
were actually going to go out for bid on that Prairie Run
17
Q. None of those individuals had discussions with
18
project?
18
you wondering where the review memorandum for Prairie Run
19
A. Yes.
19
was?
20
Q. And at that point did you expect that the
20
A. No.
21
grading and drainage plans had already been reviewed by the
21
Q. Handing you what's previously been marked as
22
city engineer?
22
Exhibit 85, a November 3rd, 2004, memorandum to yourself
23
A. Yes, I would assume so.
23
from Mr. Brixius regarding Albertville High Water Elevation
24
Q. If they re going out for bid, you would have
24
Standards, have you seen that document before?
25
expected them to be reviewed?
25
A. Yes.
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 133 through 136 of 176
Larry Kruse, March 13, 2007
35
137
139
1
Q. Did something happen in the fall of 2004 to
1
Q. And had he taken those pictures after the June
2
precipitate this memorandum?
2
2003 flood event? Is that your understanding?
3
A. Yes, but 1 don't recall the details.
3
A. Yes.
4
Q. The memorandum itself is about the Albertville
4
Q. Do you know why he didn't share those
5
High Water Elevation Standards and the inconsistencies
5
photographs with Gold Key or Hedlund Engineering prior to
6
within the Albertville ordinances and subdivision
6
plat approval?
7
ordinances, isn't it?
7
A. No, I don't I would add that, you know, that
8
A. Yes, it is.
8
a lot of times our building official is not involved in, you
9
Q. And the first full paragraph of the first page
9
know, the early development phase of the platting. Once the
10
of Exhibit 85, the last sentence says, "The City Engineer
10
plat is completed and building permit applications come in,
11
suggests separations be uniform and that in areas that do
11
that's generally when our building official gets involved.
12
not abut a lake, that the reference should not be to lowest
12
Q. Is the City of Albertville so compartmentalized
13
floor but to lowest openings." Do you see that?
13
that if Mr. Sutherland had photographs from the June 2003
94
A. Yes.
14
flood event in his file, that the other individuals from'the
15
Q. Do you have an understanding as to why the city
15
city that are working on the Prairie Run plat wouldn't know
16
engineer is suggesting that the separations be uniform?
16
those existed or he wouldn't know that that Prairie Run plat
17
A. I guess so, yes.
17
was going on and he should come forward and share those?
18
Q. And what's your understanding of why
18
A. 1 can only say that I became aware of the
19
separations should be uniform?
19
photos after I believe all of this happened.
20
A. You know, I believe this is talking between a
20
Q. Were those photos kept in Mr. Sutherland's
21
lake and a wetland. I guess I don't profess to be an expert
21
files at the city?
22
on, you know, the technical aspects of the elevations, low
22
A. I believe so, yes.
23
floor, low opening. We look to our engineer, and then when
23
Q. You didn't have like a general 2003 flood file
24
it comes to the building official, he also deals with those
24
that was available to everyone?
25
types of issues. I don't get involved in those details.
25
A. Not that I know of.
138
140
1
Q: You'd agree that it's a good idea to have
1
Q. How many meetings would you say you had with
2
ordinances that are consistent, though, in terms of the
2
SEH regarding the alleged problems that the city believes
3
separation from high water elevations?
3
existed in the plat of Prairie Run?
4
A. I think that it's probably more complicated
4
A. You know, I don't remember specific, but it
5
than that. I understand DNR has, you know, some regulations
5
could have been four or five.
6
and maybe additional Information pertaining to lakes and how
6
Q. And during those maybe four or Hive meetings
7
they fluctuate and wetlands. I just remembered that that
7
that you had with SEH, did SEH ever point out that it had
8
was the discussion that we had Is that do they — are they
8
not actually reviewed the grading and drainage plans
9
one in the same, or are they dealing with different issues.
9
associated with Prairie Run?
10
1 don't know if that makes sense, but I don't pretend to be
10
A. No.
11
the technical expert on this.
11
Q. Mr. Kruse, handing you Exhibit 98, which if you
12
Q. And do you understand that the ordinances
12
flip through it, you'll see it's City of Albertville's
13
relating to high water elevation standards were amended soon
13
Supplemental Answers to Gold Keys Interrogatories, and on
14
after this memorandum?
14
the third page you'll note it's signed by yourself. Are you
15
A. Yes, I believe they were.
15
familiar with that document?
16
Q. Did you see pictures from the June 2003 flood
16
A. Yes, I am.
17
event?
17
Q. And then turning to the second page of the
18
A. Yes, I did.
18
supplemental answer itself, it starts off saying, "After
19
Q. When did you see those?
19
further analysis of the data available to the Albertville
20
A. Probably in late 2005, early 2006.
20
City Engineer, including photographs of the flooding which
21
Q. Do you know where you got those from?
21
occurred in the areas near the Prairie Run development in
22
A. I believe our building official had some
22
July, 2003, the Albertville City Engineer's office has
23
pictures.
23
arrived at revised figures for the 100-year flood elevation
24
Q. Jon Sutherland?
24
and the highest known water elevation for Prairie Run plat."
25
A. Yes.
25
Do you see that?
Kirby A. Kennedy
& Associates 952-922-1955 1-800-545-1955 Pages 137 through 140 of 176
Larry Kruse, March 13, 2007
36
141
143
1
A. Yes.
1
A. I just think there's other information such as
2
Q. What data is being referred to that is analyzed
2
the Ditch 9 information and stuff that, you know, the
3
and available to the city engineer?
3
developer could have used, and once again, I don't pretend
4
A. I believe that Bolton & Menk did a flood study,
4
to know the difference in the numbers here of what the box
5
additional flood study work, and used the photographs.
5
culvert is or this number here, If this is more less of a
6
Q. The photographs from the 2003 flood?
6
standard than the original box culvert. For me to assume
7
A. Yes.
7
that it's not fair, I guess I don't pretend to know all
8
Q. And when it's saying July 2003 flood, do you
8
those answers.
9
believe that it's referring to what we know to be the June
9
Q. And I'm not looking for answers on the
10
2003 flood?
10
specifics about these numbers. I am asking if it seems fair
11
A. Yes.
11
to you that the city is declaring the developer to be in
12
Q. Okay. And so those two numbers that are there,
12
default for ordinances that were in effect at the time of
13
the 100-year flood elevation being 949.9 feet and highest
13
the plat --
14,
known water elevation.being 951.47 feet, do you understand
-14
A. Right.
15
that those are coming from the Bolton & Menk 2006 flood
15
Q. - but using numbers two years later in 2006 as
16
study? Is that your understanding?
16
a basis for that default. Does that seem fair to you?
17
A. Yes.
17
That's all I want to know.
18
Q. And if we flip through the rest of that
18
A. If it was just as simple as what you say,1
19
document, it's my understanding that you're saying Gold Key
19
would say yes.
20
is in default of the development agreement based on those
20
Q. That it seems fair to you?
21
numbers that Bolton & Menk determined in 2006; is that
21
A. That it doesn't seem fair.
22
correct?
22
Q. Right. Okay. How much has the city incurred
23
A. Yes.
23
in legal fees from this litigation?
24
Q. And on the third page of Exhibit 98 at the top
24
A. I don't know.
25
it starts off, "Developer has violated the following city
25
Q. Who would know that?
142
144
1
subdivision ordinances in the following ways." And in
1
A. Tina Lannes, our finance director.
2
parens it says, "(The cites below are to the ordinances as
2
Q. Do you have an approximate?
3
they were in effect at the time of final plat approval)."
3
A. No, I don't. Not right now.
4
Do you see that?
4
Q. Has the city paid anything in legal fees yet as
5
A. Yes.
5
a result of this litigation?
6
Q. So I just want to be clear that the city is
6
A. I believe we have.
7
alleging that Gold Key is in default of the development
7
Q. Is the city claiming any damages in this
8
agreement for ordinances that were in effect at the time of
8
lawsuit?
9
the final plat. Correct?
9
A. I guess 1 don't know the specifics on that
10
A. Yes.
10
question. 1 believe that, you know, we want the development
11
Q. But based on numbers that the city came up with
11
put in compliance with the ordinances. If you interpret
12
in 2006 as a result of Bolton & Menk's 2006 study. Correct?
12
that as damages, then yes.
13
A. Yes.
13
(At this time Larry Kruse Deposition Exhibit
14
Q. Does that seem fair to you?
14
Number 99 was marked for identification by the
15
A. You also have to look at other information such
15
Court Reporter.)
16
as the culvert, box culvert elevation. You know, in earlier
16
Q. Mr. Kruse, Exhibit 99 is a December 1st, 2006,
17
discussions, we talked about, you know, doing a more
17
letter from yourself to Dean Johnson. Are you familiar with
18
extensive study to see if that was a conservative number and
18
that document?
19
this would be different.
19
A. Yes.
20
Q. Okay. My question to you was, Does it seem
20
Q. And it looks to me like some of it was - I was
21
fair to you that the city is saying that the developer
21
going to say taken from Exhibit 98, but it looks like
22
violated ordinances that were in effect at the time of final
22
Exhibit 98 was created after Exhibit 99, so in any event,
23
plat approval but the numbers the city is using to declare
23
some of the information in Exhibit 99 is the same
24
that default weren't available and the city didn't come up
24
information that we just talked about with respect to 98.
25
with them until 2006? Does that seem fair to you?
25
Correct?
Kirby A. Kennedy &Associates 952-922-1955 1-800-545-1955 Pages 141 through 144 of 176
Larry Kruse, March 13, 2007
37
145
147
1
A. Yes.
1
kind of an integral part of each other.
2
Q. And those numbers in Exhibit 99, the 949.9 feet
2
Q. So the road, ponding, rate of runoff issues
3
for the 100-year and 951.47 for the highest known water
3
affect the whole plat in your opinion. Is that what you're
4
elevation, those were from the 2006 Bolton & Menk study?
4
saying?
5
A. Yes.
5
A. That's not only my consensus but rry development
6
Q. If you turn to the second page — excuse me,
6
team.
7
the third page of Exhibit 99, the second full paragraph
7
Q. But you weren't concerned about those issues in
8
says, "While the city has not thoroughly studied how these
8
June of 2004 when you approved the plat?
9
various ordinance violations may be remedied, City Staff is
9
A. To the best of our knowledge, the city had
10
concerned that the only way to bring the development into
10
followed a thorough, comprehensive process, and everything
11
compliance with Subdivision Ordinance Sections
11
was according to Hoyle.
12
A-600.13(c)(1) and A-700.6 cited above may be to raise the
12
Q. So you weren't concerned with those issues in
13
entire plat, including ponds, streets, and lot elevations."
13
June of 2004 when you approved the plat. Correct?
14
Do you see that?
14
A: No: ,
15
A. Yes.
15
Q. No, that's not correct or, no, you weren't
16
Q. Is that what you're asking Gold Key to do?
16
concerned with the issues?
17
A. I believe right now that that is, yes.
17
A. We didn't know there was issues, no.
18
Q. And have you undertaken an assessment as to how
18
Q. So you weren't concerned with them?
19
that can be accomplished, what the costs are, and so forth?
19
A. We were not concerned.
20
A. No.
20
Q. Okay.
21
Q. Do you plan to?
21
(At this time Larry Kruse Deposition Exhibits
22
A. I imagine that the council would act on that,
22
Number 100 and 101 were marked for
23
and obviously prior to something happening like that, there
23
identification by the Court Reporter.)
24
would have to be a study, yes.
24
Q. Mr. Kruse, handing you what's previously been
25
Q. And at the time the plat was approved, you
25
marked as Deposition Exhibit Number 47, if you'd turn to --
146
148
1
believed that the plans that were submitted were in
1
I think I opened it for you there, 600.13, the first
2
compliance with Subdivision Ordinance Sections
2
paragraph of that subdivision ordinance requires, "A storm
3
A-600.13(c)(1) and A-700.6; is that correct?
3
water pollution control plan shall be submitted for review
4
A. You know, I don't know those specific ordinance
4
and approval by the City Engineer for subdivision
5
numbers, but I would say yes.
5
applications for projects containing 5 acres or more of
6
Q. Right, because you believed that the plat
6
land." Correct?
7
complied with all of the city —
7
A. That's correct
8
A. Ordinances at the time of approval.
8
Q. And Prairie Run would fall within the category,
9
Q. — ordinances and subdivision ordinances.
9
5 acres or more?
10
Correct?
10
A. Yes.
11
A. Yes.
11
Q. So a storm water pollution control plan was
12
Q. How did these violations that you cite in your
12
required to be reviewed and approved by the city engineer?
13
letter impact the entire residential portion of the Prairie
13
A. Yes.
14
Run plat?
14
Q. And if you turn back to the December 1 st, 2006,
15
A. Building permits, as it says, will be held for
15
letter from yourself to Gold Key Development, the city is
16
any residential lots until the violations are corrected.
16
now claiming a violation of 600.13(c)(1). Correct?
17
Q. Right. But I'm wondering if a particular lot
17
A. Yes.
18
is in compliance in that the -- compliance with city
18
Q. Mr. Kruse, handing you what's been marked as
19
ordinances in that the elevation is okay, there's no problem
19
Exhibit 100, "Application For General Storm Water Permit For
20
with it, then does that — does the violations of the other
20
Construction Activity," you're familiar with that document?
21
lots, alleged violations of the other lots have an impact on
21
If you flip to the third page, you'll see you signed it on
22
those lots that clearly do meet the elevation requirements?
22
July 22nd '04
23
A. I think, you know, from a little bigger
23
A. Yes.
24
perspective, there's also road issues, ponding issues, rate
24
Q. And in that document the city is listed as the
25
of runoff issues and things like that, so it becomes all
25
owner on page 3, City of Albertville?
Kirby A. Kennedy &Associates 952-922-1955 1-800-545-1955 Pages 145 through 148 of 176
Larry Kruse, March 13, 2007
38
149
151
1
A. Yes.
1
on July 22nd, 2004, you're certifying
ifyi g that you previously
2
Q. And page 2 of that document under paragraph 11,
2
submitted a plan and it was approved by the local permitting
3
project type "Residential" is checked. "Residential" and
3
authority?
4
"Commercial" are both checked?
4
A. You know, I guess I -- this document was
5
A. Yes.
5
prepared for my signature, so 1 don't pretend to know all
6
Q. This is referring to the 2004 Prairie Run
6
the nuances of these details. Once again, I'm advised by
7
project, both residential and commercial?
7
our consultants that things are ready to go and prepared for
8
A. Yes.
8
signatures, and I sign and put trust that, you know, they're
9
Q. And in paragraph 12, this project creates
9
professionals and leading us down the proper path.
10
postconstruction impervious surface area of greater than
10
Q. So who prepared it and asked you to sign it?
11
1 acre. Correct? 1.5 acres, in fact?
11
A. I don't know, but it could likely be Bob
12
A. Yes.
12
Moberg.
13
Q. And in paragraph 13, for the permanent storm
13
Q. Why would you believe it was him?
14
water management, the boxes that are checked are
14
A. Well, it was probably prepared by SEH. Maybe
15
"Infiltration/Filtration" and then "Regional Ponding."
15
can make a broader, you know, because I don't know
16
Correct?
16
specifically.
17
A. Yes.
17
Q. And SEH is the one who actually then, if we
18
Q. And paragraph 14 indicates that County Ditch 9
18
turn back to the 600.3 ordinance that you read from, SEH
19
is the water body that will be receiving waters. Correct?
19
being the city engineer is the one who actually approves the
20
A. Yes.
20
plan that you submit to them?
21
Q. And again on page 3, it's signed by you on
21
A. Yes.
22
July 22nd, 2004?
22
MR. MARKERT: Can I ask a quick question?
23
A. Yes.
23
Is there a local permitting authority in Albertville that
24
Q. And that was about a month and a half after the
24
reviews storm water plans?
25
final plat of Prairie Run was approved on June 7th, 2004?
25
THE WITNESS: I believe we are our own
150
152
1
A. Yes.
1
LGU, and so I'm not aware of any other.
2
Q. And it was after the development agreement was
2
BY MS. MATT:
3
approved on — or signed on July 16th, 2004?
3
Q. So do you believe, Mr. Kruse, that it's --
4
A. Yes.
4
well, based on your own subdivision ordinance, 600.13(a)
5
Q. And above your signature in that paragraph it
5
that we read, "A stone water pollution control plan shall be
6
says that the information is, to the best of your knowledge
6
submitted for review and approval by the City Engineer." So
7
and belief, true, accurate, and complete?
7
it's the city engineer who reviews these. Correct?
8
A. Yes.
8
A. Yes.
9
Q. And under the rules of the MPCA, you aren't to
9
Q. SEH at that time. Correct?
10
submit a storm water application for a permit until any
10
A. Yes.
11
local approval that is required has been received; is that
11
Q. On the third page of Exhibit 100, whose
12
correct?
12
signature is that below yours? Do you know?
13
A. I would assume so.
13
A. I'm sorry, I can't recognize it.
14
Q. Okay. Well, if you turn to the page that's
14
Q. As the contractor? It doesn't ring a bell?
15
stamped CITY 0917, there's a flowchart there. And if you
15
A. The contractor was Fehn Construction. 1 can't
16
take a minute to look at that, the first box there — second
16
recognize the signature.
17
box says, "Is there a local permitting authority that
17
Q. And, Mr. Kruse, handing you Exhibit 101, "The
18
reviews and approves storm water plans?" Do you see that?
18
Storm Water Pollution Prevention Plan" dated May 12th, 2004,
19
A. Yes.
19
do you see that?
20
Q. And if you follow the Flow chart through, it
20
A. Yes.
21
follows that you need to first submit the plan to the local
21
Q. It's relating to the 2004 Prairie Run project?
22
permitting authority before you can submit it to MPCA.
22
A. Yes.
23
Correct?
23
Q. And the City of Albertville is listed as the
24
A. That's what it says.
24
owner?
25
Q. So by submitting this application to the MPCA
25
A. Yes.
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955 Pages 149 through 152 of 176
Larry Kruse, March 13, 2007
39
1
153
Q. Do you believe this to be the Storm Water
1
155
discussions of council meetings, it was to not make any
2
Pollution Prevention Plan that the city had in place for the
2
reductions in the letter of credit with these pending
3
Prairie Run project?
3
issues.
4
A. it appears to be that way, yes.
4
Q. Because of the pending litigation issues?
5
Q. What's your understanding of why the city of
5
A. Because of the default in the development
6
Albertville is refusing to reduce the letters of credit that
6
7
Gold Key recently asked it to reduce?
7
agreement.
Q.
8
A.
Based on the pending litigation issues? Is
There's some pending financial liability to
8
there any other default —
9
bring the development into compliance.
9
A. I suppose, yes.
10
Q. Related to these alleged defaults that we've
10
Q. -- in the development agreement? Do you have
11
discussed today?
11
an independent recollection of that meeting without looking
12
A. Yes.
12
through those minutes that are in front of you as to whether
13
Q. Not related to the specific letters of credit?
13
the city attorney was recommending that the letter of credit
14
A. 1 guess I don', understand your question.
14
be -- the reduction in the letter of credit be approved or
15
Q. Well, the letters of credit that Gold Key is
15
denied?
16
asking to be reduced relate to municipal improvements, site
16
A. My recollection is that the city attorney has
17
improvements, and landscaping plan. Correct?
17
been 100 percent in favor of not reducing the letter of
18
A. Most likely.
18
credit with the pending issues and has always had that
19
Q. And so I'm wondering if the financial
19
position.
20
obligations that you are referring to relate to these other
20
Q. Okay. Are you aware of the Ditch 9 Plan?
21
defaults that you're alleging that we've talked about
21
A. No, I'm not.
22
extensively today or whether they relate to the specific
22
Q. The Ditch 9 Agreement?
23
letters of credit regarding municipal improvements, site
23
A. I recently learned that there was an agreement.
24
improvements, and the landscaping plan.
24
Q. How did you learn about it?
25
A. You know, I don't know all the nuances, but 1
25
A. I believe through some of the litigation
1
154
do know that our city attorney and engineer have reviewed
1
156
efforts here it was provided to us by the City of
2
this and they are making this recommendation to us that we
2
St. Michael.
3
take this action.
3
Q. And are you aware that under that, the cities
4
Q. Okay. Well, originally the February 5th, 2007,
4
of Albertville and St. Michael were to be responsible for
5
minutes that were published indicated approved city
5
reviewing the hydrology of Ditch 9 watershed located in
6
attorney's recommendation to reduce the letter of credit for
6
their respective cities to determine the flow capacity?
7
Prairie Run Addition. Are you aware of that?
7
A. No, I wasn't.
8
A. 1 think that was an error in the rninutes, and 1
8
Q. So if you weren't aware of it, it's safe to
9
think it was subsequently corrected.
9
assume that the city did not review the hydrology of the
10
Q. After you got my March 10th, 2007, letter?
10
Ditch 9 watershed under the Ditch 9 agreement?
11
After Bridgette Miller got that? Correct?
11
A. Not that I'm aware of. I believe our city
12
A. I'm not sure.
12
engineer and, you know, St Michael's engineer have recently
13
Q. Do you recall the discussion at the
13
discussed it, but other than, I'm not aware of any plan.
14
February 5th, 2007, meeting regarding reducing the letters
14
Q. As city administrator, you'd agree that you
15
of credit?
15
should be aware of agreements that would require you to
16
A. Can I ask, Do you have a copy of that? 1
16
repair and maintain the ditches located within your city?
17
missed a meeting, and I'm wondering H that was the meeting.
17
A. Yes.
18
MR. KUBOUSHEK: I think we have it as an
18
Q. Have you had any conversations with Dean
19
exhibit. Part of Exhibit 95 are those minutes.
19
Johnson other than the ones that we've talked about today?
20
Q. You were there unfortunately. Do you have a
20
A. None come to mind, no.
21
recollection of that discussion?
21
Q. Have you had any conversations with Randy
22
A. Yes.
22
Hedlund other than the ones we've talked about today?
23
Q. And can you tell me what your recollection of
23
A. No.
24
the discussion is?
24
Q. Anyone from Hedlund Engineering's office?
25
A. I think in our precouncil staff discussions and
1 25
A. No.
Kirby A. Kennedy & Associates 952-922-1955
1-800-545-1955 Pages 153 through 156 of 176
Larry Kruse, March 13, 2007
40
157
159
1
Q. Did you attend a meeting in March or April of
1
this happens to be a pretty large one, but yes.
2
2006 regarding a comprehensive storm water management plan
2
Q. So if a problem does arise on a plat that's
3
for the City of Albertville?
3
been approved, is it the developer's responsibility to
4
A. I believe so.
4
correct that problem with the design?
5
Q. And what do you recall about what was discussed
5
A. Yes.
6
at that meeting?
6
Q. is it the city's engineer? Is it the city
7
A. Just that staff was advising the city that --
7
engineer's responsibility to correct the problem with the
8
the need to do a bigger, 1 0,000-foot broader study.
8
design?
9
Q. Instead of piecemeal studies?
9
A. No.
10
A. Yes.
10
Q. So do you believe that a developer should be
11
Q. And what was the importance of doing that
11
relying on the city's engineer to catch problems with the
12
broader study rather than the piecemeal studies?
12
plat design that he submits to the city?
13
A. You know, so the city fully understands the
13
A. I guess you would hope that during the review
14
.bigger picture regarding storm -water management.
14
process, that there's an opportunity to do that, but
15
Q. Why is that important to the city?
15
don't -- I think ultimately the designing engineer spends
16
A. Probably to prevent some of the problems such
16
the most amount of time researching and doing the detailed
17
as were experienced in the 2003 flood.
17
work, and if money wasn't an issue, we could spend and
18
MS. MATT: i don't have any further
18
probably redesign everything, but that Isn't practical, so a
19
questions.
19
review is a review.
20
20
Q. So should the developer or the developer's
21
CROSS-EXAMINATION
21
engineer be relying on that review by the city engineer to
22
BY MR. MARKERT:
22
catch problems in their plat?
23
Q. Mr. Kruse, my name is John Markert, and 1
23
A. No.
24
represent SEH in this matter.
24
Q. And, in fact, if we look at the development
25
Quick follow-up as far as questioning by
25
agreement, which you quoted a portion of in Exhibit 99 — if
158
160
1
Ms. Matt over the meeting minutes. Are the meeting minutes
1
you grab Exhibit 99 —
2
that show up on the Internet, are those transcriptions of
2
A. (Witness complies.) Yes.
3
everything that gets said at a council meeting?
3
Q. On the first page of Exhibit 99, you quoted a
4
A. No.
4
portion of the development agreement dated July 16th, 2004.
5
Q. So they're summaries of what was said at
5
Do you see that paragraph, the last paragraph on the first
6
council meetings; is that right?
6
page, the very first page?
7
A. Yes.
7
A. Yes.
8
Q. So are there tapes of the council meetings
8
Q. Doesn't that paragraph of the development
9
where one could sit down and listen to every word that gets
9
agreement contemplate that there may be issues that arise
10
said at a council meeting?
10
with the plat after it's been approved and that it's the
11
A. No.
11
developer's responsibility to bring a plat into compliance
12
Q. So we have no way of determining the exact
12
with the city ordinances?
13
conversations that took place at any given council meeting;
13
A. Yes.
14
is that right?
14
Q. And the city has the right to stop work
15
A. That's correct
15
pursuant to the development agreement if it's later
16
Q. Now, there was some discussion, actually quite
16
discovered that the plat does not meet city ordinances; is
17
a bit of discussion, about responsibility for these issues
17
that right?
18
that have arisen. And I have a question: In your years of
18
A. Yes.
19
experience as a city administrator, have there been
19
Q. Now, you talked about the development process
20
instances where a plat design goes through approval, gets
20
in a general sense earlier in your deposition today, and 1
21
approved, and then later on a problem is discovered with
21
wanted to kind of ask you about your experience when a
22
that plat design?
22
developer ap
proaches pproaches the City of Albertville. The first
23
A. You know, I'd just speak generally that we
23
question I have is when a developer approaches the city, in
24
don't live in a perfect world, and all those problems are
24
your experience, has that developer typically done
25
relative. I mean, there may be small grading issues, and
25
investigation on the property that he wants to develop?
Kirby A. Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 157 through 160 of 176
tarry Kruse, March 13, 2007
41
161
163
1
A. Yes.
1
engineer in the City of Albertville?
2
Q. And do you believe that a developer has an
2
A. No, I'm not aware of a specific list There
3
obligation to do an investigation into the property he's
3
may be a contract, and I don't know how detailed that would
4
going develop?
4
be, listing out some of the expectations.
5
A. Yes.
5
Q. Have you ever seen the contract between the
6
Q. Did Gold Key, or Dean Johnson, indicate to you
6
City of Albertville and SEH that was in place?
7
that he had done investigation of the Prairie Run property
7
A. No.
8
when he first approached the city?
8
Q. So you don't know whether that contract lists
9
A. I believe so.
9
out those responsibilities for the city engineer or not?
10
Q. And did he indicate what type of investigation
10
A. No, I haven't reviewed it
11
he had conducted or people on his behalf had conducted?
11
Q. Did you participate in the negotiations for the
12
A. I don't recall.
12
contract with Bolton & Menk?
13
Q. Did Dean Johnson show you documents with regard
13
A. Yes.
14
to their investigation of the Prairie Run -property?
14
Q. Does the confract with Bolton & Menk list
15
A. You know, I don't recall.
15
responsibilities the City of Albertville is expecting from
16
Q. Did Dean Johnson ever ask you for documents
16
Bolton & Menk as city engineer?
17
from the city regarding the Prairie Run property?
17
A. i would think so, but I'd have to look at the
18
A. I never received any request.
18
document
19
Q. Did Randy Hedlund make a request to you?
19
Q. Do you know if that document has been produced
20
A. No.
20
in the city's files?
21
Q. Did Dean Johnson or Randy Hedlund ever ask the
21
A. I would think so, but I'd have to verify it
22
city what the 100-year high water mark was for the Prairie
22
MR. KUBOUSHEK: Which document?
23
Run property?
23
MR. MARKERT: The contract between Bolton
24
A. Not that I'm aware of.
24
& Menk and the city for the city engineering services Bolton
25
Q. Did Dean Johnson or Randy Hedlund ever ask the
25
& Menk has been performing.
162
164
1
city for information with regard to Ditch 9 which bordered
1
MR. KUBOUSHEK: No, it hasn't.
2
the Prairie Run property?
2
MR. MARKERT: I'll probably ask for that.
3
A. Not that I'm aware of.
3
MS. MATT: Otherwise I will if he
4
Q. Did you ever discuss the flooding that took
4
doesn't.
5
place in the City of Albertville in the summer of 2003 with
5
BY MR. MARKERT:
6
Dean Johnson?
6
Q. Did you know if there's a requirement for the
7
A. I never, no.
7
city engineer to review a preliminary plat or final plat
8
Q. Were you ever in a meeting where that topic
8
approval? Is there a requirement in city ordinances for the
9
came up where Dean Johnson was present?
9
City of Albertville?
10
A. You know, I believe there probably was some
10
A. I don't know if it's a requirement, but it's a
11
discussion somewhere along the line as development moved
11
practice that we have.
12
through the stages there.
12
Q. But you can'ttell me whether or not by
13
Q. Do you think that that discussion took place
13
ordinance it's required for the city engineer to review a
14
prior to final plat approval?
14
preliminary plat or a final plat?
15
A. Yes.
15
A. No.
16
Q. Do you think that Dean Johnson was unaware
16
Q. Could you go back to Exhibit 96 for a minute,
17
there were flooding problems in the City of Albertville when
17
please?
18
he proposed the plat for Prairie Run?
18
MR. KUBOUSHEK: Which one is it?
19
A. 1 don't know, but initially, you know, I don't
19
MR. MARKERT: It's a November 23, 2005.
20
know where he's from or anything, but by the time of the
20
unsigned memo from Bob Moberg to Mike Couri.
21
preliminary plat, I think there had been some discussions of
21
A. (Witness complies.) Yes.
22
the 2003 incident
22
BY MR. MARKERT:
23
Q. With regard to the duties of the city engineer,
23
Q. Do you have that in front of you? When
24
is it — I believe you testified to this; but is there a
24
Ms. Matt was questioning you with regard to Exhibit 96, 1
25
written list of duties and responsibilities for the city
25
think she asked you who came up with the three numbered
Kirby A Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 161 through 164 of 176
Larry Kruse, March 13, 2007
42
165
167
1
issues that are on page 1. Do you remember that
1
of SEH relative to Hedlund Engineering regarding the design
2
questioning?
2
of the residential portion of the Prairie Run plat, you
3
A. Yes.
3
testified that SEH was not required to reengineer those
4
Q. And you said — and I'm not sure I'll quote you
4
plans as part of their review. Do you recall that line of
5
exactly, but you said Bob Moberg was obviously instrumental
5
testimony?
6
in coming up with these points. Do you remember that?
6
A. Yes, I do.
7
A. Yes.
7
Q. But you are not an engineer. Right?
8
Q. What causes you to believe that Bob Moberg was
8
A. Right.
9
instrumental in coming up with these issues?
9
Q. So let me ask you what you meant by the phrase
10
A. Well, to start with, it's a memo from him.
10
"reengineering the plans" as part of the review of SEH.
11
Q. Yes.
11
A. Well,1 think that the primary engineer spends
12
A. And he was a part of our, you know, call it our
12
a lot of time and effort developing plans and a lot of
13
development team — our city attorney, engineer, and
13
money, and what we end up doing as the city is have our city
14
planner —working through these issues:
14
' engineer do a review. And there`s always that balance of
15
Q. And that was kind of my point, that it was my
15
not spending too much time on it because it's at the
16
understanding that you, the development team, which
16
developer's nickle, and when we do, they end up complaining
17
consisted of Mr. Court, Mr. Moberg, and at this point in
17
to us that our fees are too high or our costs are too high,
18
time did that also consist of Adam Nafstad, the team?
18
so it's a matter of striking that balance of making sure
19
A. I believe so.
19
that it complies with the ordinance and that the work is
20
Q. And Mr. Brixius?
20
complete.
21
A. Yes.
21
Q. Okay. But do I take it that when you use the
22
Q. And yourself?
22
phrase "reengineering," what you meant was essentially
23
A. Yes.
23
starting from scratch and doing the whole plan as though it
24
Q. So you're all discussing these various issues,
24
had not been done before?
25
and my question is, did the team come up with these issues
25
A. Right.
1
166
and Bob Moberg happened to be the person that drafted this
1
168
Q. Would you agree, though, that a review of the
2
memo?
2
elevations used in a plan doesn't constitute starting from
3
A. 1 believe that to be true.
3
scratch and reengineering the plan?
4
Q. So the team would be instrumental in coming up
4
A. I would agree.
5
with these issues, not just Bob Moberg?
5
Q. Would you agree that that is the level of
6
A. Right
6
review that the city reasonably expected of its city
7
MR. MARKERT: I have no further
7
engineer?
8
questions.
8
A. I would agree.
9
9
MR. VAN DER MERWE: Give me just a minute
10
CROSS-EXAMINATION
10
here..
11
BY MR. VAN DER MERWE:
11
Q. You also testified earlier regarding a review
12
Q. Mr. Kruse, I represent Hedlund Engineering, and
12
memorandum, that the majority of the time the city engineer
13
happily most of the questions for Hedlund Engineering have
13
will write a report that gets incorporated into the plans
14
already been asked, so I won't go over the ground that's
14
but that it's not an invariable part of the process. Is
15
already been plowed so well by counsel before me.
15
that fair?
16
1 take it by education that you are not an
16
A. I'm not aware that it's a requirement
17
engineer. Is that fair?
17
Q. Right.
18
A. Yes.
18
A. But it's a practice that we have.
19
Q. What is your post -high school educational
19
Q. So sometimes review memoranda are there and
20
qualification?
20
sometimes not. Is that fair to say?
21
A. I have my bachelor's degree, and I'm in the
21
A. Well, I would hope for the most part that
22
final stages of writing my thesis for my masters degree.
22
they're there. You know, I think it would be more the
23
Q. in what?
23
exception not to have it, but there's no requirement
24
A. Public administration.
24
Q. Okay. And forgive me if this has been asked,
25
Q. When you previously testified about the duties
25
but if the review memorandum is not there, is it assumed
Kirby A. Kennedy 8 Associates 952-922-1955 1-800-545-1955
Pages 165 through 168 of 176
y Kruse, March 13, 2007
43
169
171
1
that it is because there are no comments about the plan that
1
report that was introduced as Exhibit 65. And I'm asking
2
has been reviewed?
2
you whether between lunch and now that you've recalled what
3
A. I think that's the assumption, especially when
3
letter that was.
4
the consultant is recommending approval of the project, yes.
4
A. I think that there was one exhibit from the —
5
Q. The public meetings that we've heard about
5
was it the soil and water? There was an exhibit that's been
6
today, including the June 4 -- June 7, 2004, final approval
6
submitted I thought that referenced the Ditch 9. 1'd have
7
meeting, it's my understanding that those council meetings
7
to go back and review.
8
are open to the public. Correct?
8
Q. Okay. But just so I'm clear, are you saying
9
A. That's correct
9
that there's perhaps a letter that references Ditch 9, but
10
Q. And there are members of the public that sit in
10
are you saying that it also references errors made by
11
on those meetings. True?
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Hedlund?
12
A. That's correct
12
A. No, I don't think so.
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Q. And those members of the public typically will
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Q. Okay.
14
include, for example, the developer or perhaps the
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A. I don't believe so.
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developer's engineer, folks like that?
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MR. VAN DER MERWE: All right. Thank
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A. That's correct
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you, sir. I appreciate your time.
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Q. And is it fair to say that when the city
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MS. MATT: Couple of follow-up questions.
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council approves a development plat in a public forum such
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19
as I've just described, that it is a representation by the
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RECROSS-EXAMINATION
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city that the development is approved in all respects?
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BY MS. MATT:
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A. If the council takes that action, yes.
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Q. Mr. Kruse, you said that the minutes on the
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Q. Is that the action that was taken in this case
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Internet are not accurate; is that right?
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on June 7th?
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A. No, I didn't say that.
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A. Yeah.
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Q. I thought that's what your testimony was when
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Q. Forgive me if you were asked this, but you
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Mr. Marked asked you about —
170
172
1
described how the Prairie Run project was a little unique
1
A. He asked me if they were a verbatim
2
that multiple parties had to be brought together. Do you
2
transcription and, no, they aren't That's my
3
recall that?
3
interpretation.
4
A. Yes.
4
Q. So the minutes that are on the Internet, there
5
Q. And you were also told that Mr. Carlson had
5
might be some typos in them? You're saying that they're not
6
been waiting for the feasibility report and the assessment
6
a verbatim transcription of what happened at the meeting.
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regarding access roads. Do you recall that?
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Is that correct?
8
A. (No verbal response.)
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A. It's not a word for word just like the recorder
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Q. That is — sorry, let me complete that. He was
9
is taking today. It's a summary.
10
waiting for that information prior to his review of the
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Q. Okay. I understand. But the minutes that are
11
grading and drainage plans for the residential portion of
11
on the Internet are the same ones that if I went down to the
12
the Prairie Run plat.
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city hall and wanted to pull the minutes from a particular
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A. I recall that Mr. Carlson was waiting for call
13
meeting and I compared those with the ones that are on the
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it drawings and other supplemental information that goes
14
Internet, they're the same. Correct?
15
along with the submittals to him for review.
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A. You know, the council, we don't — I'm not
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Q. Okay. Prairie Run was a little unique in that
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aware of us publishing any minutes that aren't approved by
17
respect. Were you likewise aware of the need for this
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the council.
18
assessment to proceed, a review of the grading and drainage
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Q. So the minutes that are on the Internet should
19
plans?
19
be the same?
20
A. No.
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A. To the best of my knowledge, they're the
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Q. And let me ask you one more time, although you
21
accurate reflection of the meeting action.
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did answer this previously, but in the interim between being
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Q. Okay. Mr. Markert said a review is a review,
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asked and my question now regarding the errors that Hedlund
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and then he went on to ask you if the developer and its
24
is alleged to have made, you thought that there was a letter
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engineer should rely on that review to catch their mistakes.
25
that described that error other than the Brian Walters
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Do you recall that testimony —
Kennedy & Associates 952-922-1955 1-800-545-1955
Pages 169 through 172 of 176
March 13, 2007
44
173
175
1
A. Yes'
1
(UPON COMPLETION, forward this original Reading and Signing
2
Q. -- or that question?
2
Certificate to Attorney Cindi S. Matt, who already has the
3
A. Yes.
3
Sealed Original.)
4
Q. And 1 believe your answer was that the
4
5
developer should not rely on that review to catch mistakes.
5
(LARRY KRUSE)
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Is that accurate?
6
7
A. I believe so.
7
1, LARRY KRUSE, do hereby certify that I have read the
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Q. That's accurate as to what you testified to?
8
foregoing transcript of my Deposition and believe the same
9
A. Yes.
9
to be true and correct (or except as follows, noting the
10
Q. But you'd agree, wouldn't you, that a developer
10
page and line number of the change or addition desired and
11
and its engineer could and should expect that some review be
11
the reason why):
12
done of the grading and drainage plans and submittals?
14
13
A. Yes.
13
14
Q. Okay. Then just to, be clear, the city did not.
14
15
provide any information regarding the Ditch 9 100-year
15
16
elevations to Gold Key or its engineer. Correct? .
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A. I'm not aware of any Information being given to
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18
them.
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19
Q. And the city didn't provide any other 100-year
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20
information to the developer or its engineer. Correct?
Y0
21
A. I'm not aware of any.
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MS. MATT: I don't have any further
22
23
questions.
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MR. MARKERT: None.
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Dated this day of
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MR. VAN DER MERWE: Thank you.
25
(RDH)
174
1
176
STATE OF MINNESOTA )
1
MR. KUBOUSHEK: We'll read and sign.
2
) SS.
2
You're all done.
COUNTY OF WRIGHT )
3
3
Be it known that I took the deposition of LARRY KRUSE
(Whereupon, at approximately 3:10 p.m.,
on the 13th day of March, 2007, at 9321 Ensign Avenue South,
4
Tuesday, the 13th day of March, 2007, the
4
Bloomington, Minnesota;
5
taking of the deposition of LARRY KRUSE was
5
That I was then and there a Notary Public in and for
the County of Wright, State of Minnesota, and that by virtue
6
adjourned.)
6
thereof, 1 was duly authorized to administer an oath;
7
7
That the witness before testifying was by me first duly
sworn to testify the whole truth and nothing but the truth
8
8
relative to said cause;
9
9
That the testimony of said witness was recorded in
Stenotype by myself and transcribed into typewriting under
10.
10
my direction, and that the deposition is a true record of
the testimony given by the witness to the best of my
11
11
ability;
12
12
That the cost of the original transcript has been
13
charged to the party noticing the deposition, unless
13
otherwise agreed upon by Counsel, and that copies have been
14
made available to all parties at the same cost, unless
14
otherwise agreed upon by Counsel;
15
15
That I am not a relative to any of the parties hereto
16
nor interested in the outcome of the action;
16
17
That the reading and signing of the deposition by the
17
witness was executed as evidenced by the preceding page;
18
18
That Notice of Filing was waived.
19
20
19
WITNESS MY HAND AND SEAL this day of
20
----- 2007.
21
22
21
23
22
23
R_
andall D. Herrala, RPR
Y4
Court Reporter
25
24
25
Kirby A. Kennedy & Associates 952-922-1955
1-800-545-1955 Pages 173 throuoh 176 of 176
Key Dates
2003
Summer
Albertville Flood 8+ inches of rain
2003
November
Larry starts work for City of Albertville
Plat approved - cooperative venture with City facilitating project for multiple
2004
owners
2005
September
Significant rain event, fish in Prairie Run Cul-de-sac
2005
November
Couri letter to withold building permits on about 25 lots boardering weltlands
2006
May
Gold Key sues
2006
December
City issues letter to Gold Key holding building permit on entire development
2007
August
Court orders release of building permits
2007
September
City approves Letter of Credit reduction
Key Points
Market peaked in 2005
Last townhome permit issued was in Aug 2006
Approximately 1500 vacant lots in Albertville immediate market area
Housing slow down because of financing, jobs, gas, congestion, longer
commute times
Building revenuew down approximately 2/3 from 2004
Assessments certified in late 2005 for first payment in May 2006, then October,
etc
Letter of Credits
$680,000 Municipal Improvements
$53,000 Off -site improvements
$58,000 Landscaping improvements
New Home Building Permits
2001 & 2002 = Over 200 per year
2003 & 2005 = Over 100 per year
2006 & 2007 = 90 and 54 respectively
20086
Questions
Do you believe it is right for the City to stop development several years after
approval.
This has been a difficult situation for all involved. The Developer, the builders,
the developer's engineer who everyone relied on, the City's consulting engineer
and the City. When you find fish in a cul-de-sac and other significant flooding
after a less than 100 year rain event, the City has the obligation to ask question
and make sure the Developer plan works. It is unfortunate and in a perfect world
the answer to your question is yes.
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