City Council Minutes 09-27-1993MINUTES
REGULAR MEETING - MONTICELLO CITY COUNCIL
Monday, September 27, 1993 - 7 p.m.
Members Present: Ken Maus, Shirley Anderson, Brad Fyle, Clint Herbst, Patty
Olsen (arrived during discussion on item #4)
Members Absent: None
2. Consideration of approval of minutes of the regular meeting held
September 13, 1993.
After discussion, a motion was made by Brad Fyle and seconded by Shirley
Anderson to approve the meeting minutes as submitted. Motion carried
unanimously.
3. Citizens comments/petitions, requests, and complaints.
A representative from the Minnesota Community Forest Program, presented
the City with a plaque recognizing the City for its efforts to maintain an
urban forest program. The plaque recognizes Monticello for being
designated as a "Tree City."
4. Public hearing for the application of funding to the State of Minnesota for
The H -Window Company, and consideration to adopt the resolution of
applicant, City of Monticello.
011ie Koropchak requested that City Council conduct a public hearing
associated with an application for funds to be provided by the State of
Minnesota, channeled through Monticello and offered to The H -Window
Company to assist in funding a portion of the expenses associated with the
expansion of The H -Window Company. Koropchak noted that the amount
funded through the state program is $400,000. If the state approves the
requested grant, the City will receive the grant and, in turn, provide the
funds to the H -Window Company as a loan. The City has the right to
retain the first $100,000 principal and interest payback while the state
retains the remaining $300,000 principal and interest payback. Koropchak
stated that it is recommended by City staff Council approve the $400,000
loan structure with an interest rate schedule designed to assist The H -
Window Company in the first critical years of the company's growth and
expansion. Interest rate schedule is proposed as follows:
Years 1-2
0%
Year 3
2%
Year 4
3%
Year 5
4%
Year 6-10
5%
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Brad Fyle asked who is paying for the cost to apply for the state funds?
011ie Koropchak responded by saying that the funds necessary to pay the
cost to apply for the loan will be derived from the revenue received by the
City when H -Window pays back the loan which was originally funded by the
State. Brad Fyle mentioned that he continues to be opposed to the use of
tax increment financing funds for expansion. Businesses already located
here will expand on their own due to the benefits that this area provides in
terms of location on the freeway, work force, etc. Fyle also noted, however,
in this case, since State funds do not originate from Monticello yet a portion
of the loan money is paid back to the City for future loans, this is an
excellent deal.
Ken Maus mentioned that this company could have easily moved rather
than expand in Monticello. The expansion will create 60 new jobs that may
have gone elsewhere if the City had not provided TIF assistance that any
other would have provided. Shirley Anderson concurred that the City can't
pass up an opportunity to encourage expansion of an existing proven
business.
There being no further comments, Ken Maus closed the public hearing.
After discussion, a motion was made by Shirley Anderson and seconded by
Clint Herbst to adopt a resolution authorizing the City Administrator to
submit a Community Development application on behalf of the City of
Monticello to the Department of Trade and Economic Development and
approve the recommended loan terms. Motion carried unanimously.
SEE RESOLUTION 93-35.
5. Public hearing and the consideration to adopt a resolution relating to the
modification of the Redevelopment Plan for Redevelopment Proiect No. 1,
the modification of the plans for Tax Increment Financing Districts Nos. 1-1
through 1-12 and Tax Increment Financing Districts Nos. 1-14 through 1-
15, and the adoption of the Tax Increment Financing Plan for TIF District
No. 1-13 (Standard Iron and H -Window TIF plan amendments).
011ie Koropchak asked that Council consider approval of an amendment to
TIF District No. 1-7 (H -Window), which will increase the district budget by
$126,000. H -Window will be expanded by 25,600 sq ft and office space by
4,000 sq ft, resulting in the creation of 60 new jobs.
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Council is also asked to approve creation of TIF District 1-13 (Standard
Iron). Budget for District 1-13 totals $334,000 and calls for $311,000 in
pay-as-you-go TIF assistance for land right, town, and site improvements.
The TIF plan is based on construction of a 48,000 sq ft facility, 32,000 sq ft
manufacturing space, and 16,000 sq ft office space. Final site plan shows a
52,000 sq ft facility. The project will result in creation of 65 jobs in the first
year and 115 within 3 years.
Rusty Demeules, president of Standard Iron, was present to describe the
type of manufacturing that Standard Iron is involved in. He noted that this
facility will be constructing components used in construction of farm
implement equipment and other machinery. He also noted that it is
expected that in 5 years there are plans for a 30,000 sq ft addition to the
structure which would result in a total employee base of 200.
After discussion, a motion was made by Clint Herbst and seconded by Patty
Olsen to adopt a resolution relating to modifications of the Redevelopment
Plan for Redevelopment Project No. 1, the modification of the plans for TIF
Districts Nos. 1-1 through 1-12 and TIF Districts Nos. 1-14 through 1-15,
and the approval and adoption of the TIF Plan for TIF District No. 1-13.
Motion carried unanimously. SEE RESOLUTION 93-36.
6. Continuation of public hearing on Project 93-09C, Alley Improvements.
John Simola reported that the public hearing was continued to today's date
due to the previous lack of bids for the project. We have now obtained bids
for the work and have put together a list of properties with proposed costs
for each property. At the same time, we have received information from
land owners adjacent to the alley that would like to see additional work
done in conjunction with the alley improvements. The work proposed by the
adjacent property owners would make the project less of a patch job and
could involve replacing portions of existing parking areas. Simola
summarized the situation by saying that there is support for the project but
not as it is presently designed and suggested that since the project as
designed doesn't seem to address the needs of the local businesses, perhaps
a committee could be formed to improve the design.
At this point in the meeting, Ken Maus closed the public hearing.
After discussion, a motion was made by Shirley Anderson and seconded by
Brad Fyle to establish a committee for the purpose of preparing an
improved plan for reconstruction of subject alleys and associated
improvements. Motion carried unanimously.
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7. Consideration of storm sewer improvements for Monticello Ford.
John Simola reported that since there is no storm sewer system leading
from the Ford property other than the Highway 25 ditch, Monticello Ford is
faced with needing a large drainage pond on the south end of their property
near the Hart Clinic, or they must construct a storm sewer from the south
end of the property over to the pond in Sandberg South. If they construct a
pond on their property, they are using valuable property that could be used
for expansion of their business in the future. If they build and pay for a
storm sewer system leading to the Sandberg South pond, they would have
to pay 100% of that cost and would have to share the cost of an outlet to be
constructed in the future. The estimated cost of constructing the storm
sewer connection is $35,000. Including all contingencies and indirect costs,
the cost could be $46,700.
Simola went on to report that Dave Peterson is seriously considering
requesting that the City complete this improvement project with the cost of
the project being assessed back to his property. According to Assistant
Administrator O'Neill, Peterson is willing to pay 10% of the cost of the
project up front with the balance of the cost assessed against his property to
be paid back over a period of 10 years at the prevailing interest rate. It was
the consensus of Council that the terms proposed by Peterson as outlined by
O'Neill were acceptable.
After discussion, a motion was made by Brad Fyle and seconded by Shirley
Anderson to authorize the installation of storm sewer by change order on
the Hart Boulevard project or authorize the City Engineer to develop full
plans and specifications and bid the project, whichever is found to be the
least expensive, and grant Monticello Ford the right to stop the project in
the event the bid amounts exceed an acceptable level. Motion carried
unanimously.
8. Consideration of accepting conveyance of tax forfeiture parcel from Wright
County --former Gille Auto property.
Rick Wolfsteller requested that Council consider taking ownership from the
County to expedite cleanup of the site, which includes building demolition,
underground fuel tank removal, and soil contamination cleanup through the
Minnesota Petrofund. Wolfsteller suggested a number of conditions
associated with accepting ownership from the County.
Clint Herbst noted that taking ownership of this property has some risk.
What if contamination on site is in excess of what is expected? The costs to
clean it up could rocket up. Ken Maus responded by saying that the site
evaluation that was recently completed has given us a good understanding
of the problem. Even if a bigger problem is discovered once the cleanup
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begins, the City exposure is 10% of the additional cost with the Petrofund
paying the rest. Clint Herbst emphasized that he supports the cleanup;
however, we should recognize that there are risks. Ken Maus concurred
that there are some unknowns, but the risks in accepting the property is
not excessive.
Brad Fyle indicated that he would like to see it cleaned up; however, he felt
that the penalty and interest that the County requests to be paid before
conveying the property to the City should be forgiven by the County. In
this situation, the City is taking the initiative and the risk associated with
cleaning up the site; therefore, the County should consider forgiving the
penalty and interest.
After discussion, a motion was made by Clint Herbst and seconded by Brad
Fyle to agree to ownership of the property at no cost under the following
conditions:
a. After cleanup, City can sell the property and keep sufficient funds to
cover all out-of-pocket costs.
b. Remaining funds will be applied to the County expenditures.
C. If there are any remaining funds, they will be applied to the
delinquent taxes of approximately $11,300 without delinquent penalty
and interest of approximately $9,000.
d. Any funds remaining after the above expenditure reimbursements
would be the City of Monticello's.
e. If the City did not seek sufficient funds to cover its own out-of-pocket
expenditures, the County would agree to split any additional
expenditures on a 50/50 basis.
In addition, City staff is directed to determine whether or not new bids need
to be obtained for the work associated with cleaning up the site. If new bids
need to be obtained, staff is authorized to seek new bids. Motion carried
unanimously.
9. Consideration of change order #4 to the vehicle storage building, Proiect 92-
06.
John Simola reported that all the work from Monticello vehicle storage
building has been completed with the exception of painting. Painting was
attempted last fall; however, cold weather hampered the operation. A
portion of the exterior painting was not the proper thickness. Portions of
the building were painted the wrong color. Still other portions of the
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Council Minutes - 9/27/93
building were painted during sub -freezing temperatures, which does not
comply with the manufacturer's application specifications. The painting
contractor agreed to prime the building and repaint the entire building and
provide a 3 -year extended warranty for $11,304. After several months of
negotiation, the painter's insurance company agreed to pay damages in the
amount of $11,304 so that the building could be repainted. The insurance
company requested that they make payment to the City of Monticello, as we
were the owners of the building. Consequently, in order to pay Rochon
Corporation the $11,304 for the painting that was completed, we must do so
through the change order process. Change order #4 has been developed for
that purpose.
After discussion, a motion was made by Brad Fyle and seconded by Patty
Olsen to approve change order #4 in the amount of $11,304. Motion carried
unanimously.
10. Consideration of change order #1, the trunk storm sewer extension and
appurtenant work to Hart Boulevard, City Project 93-06C.
John Simola reported that the Hart Boulevard Storm Sewer Project is well
underway and should be completed in the near future. The City Engineer
and Contractor, LaTour Construction of Maple Lake, have requested that
we modify the payment units for rip rap from the cubic yard to the square
yard. There will be no increased cost to the project for making this change.
Secondly, during the excavation through the existing parking lot, a large
pile of buried demolition was uncovered consisting mainly of large pieces of
concrete and steel rebar. These materials were removed from the street
area and pipe zone and were replaced with suitable fill. The cost of
removal, replacement, and disposal is $26.50/cubic yard. Based upon the
estimated quantity of 100 yards, the cost to the project is $2,650. This is
the amount requested for change order #1.
After discussion, a motion was made by Shirley Anderson and seconded by
Brad Fyle to approve change order #1 for Project 93-06C in the amount of
$2,650. Motion carried unanimously.
11. Consideration of approval of plans and specifications and authorization to
proceed for bids for Improvement Project 93-11C, chlorination and
dechlorination improvements to the wastewater treatment plant.
John Simola reported that OSM has completed the plans and specifications
for the chlorination and dechlorination system at the Wastewater
Treatment Plant. Our deadline for the project is to have the systems in
place and in operation during the month of October 1994 so that we can
demonstrate to the Minnesota Pollution Control Agency that we can
dechlorinate prior to the end of our permit in December 1994. Since we do
Council Minutes - 9/27/93
not chlorinate after November 1, the October deadline is necessary. City
staff and OSM have discussed moving up the timetable due to the necessity
to chlorinate during the summer months of 1994. It would be very difficult
to continue chlorination during the summer while the construction is going
on in the existing chlorine room. We, therefore, feel that it would be in our
best interest to move the timetable up for winter construction and the
spring of 1994 for startup and request that Council approve the plans and
specifications and authorize advertisement for bids, contingent upon
approval of the plans and specifications by the Minnesota Pollution Control
Agency. This would allow us to be out for bids in November or December
and would allow us to award the project around the first of the year.
Anticipated construction cost for this improvement is $51,000.
After discussion, a motion was made by Shirley Anderson and seconded by
Clint Herbst to approve plans and specifications and authorize
advertisement for bids contingent upon approval of plans and specifications
by the Minnesota Pollution Control Agency. Motion carried unanimously.
12. Consideration of bills for the month of September.
Motion made by Brad Fyle and seconded by Patty Olsen to approve the bills
as submitted. Motion carried unanimously.
13. Other Matters
A. John Simola reviewed the modifications made to the Recycling
Program. He noted that as part of the program to encourage better
participation in the program, Vasko Sanitation was authorized to
leave garbage containers that were filled with recyclables. Simola
reported that this affected about 7% of the property owners. It was
the consensus of Council to accept this short-term measure as a
wake-up call to people refusing to recycle.
B. Clint Herbst noted that he had received a call .from a property owner
requesting a burning permit. It was his view that taking a poll of the
Council is not the best way to determine whether or not to issue a
burning permit.
Assistant Administrator O'Neill noted to Council that during the
Council's previous discussion on this general topic, Council directed
staff to refuse issuance of any burning permit applications that do not
comply completely with the ordinance governing outdoor burning.
Such applications were supposed to be submitted to the City Council
at a regular meeting, whereupon Council could consider waiving
requirements that could not be met.
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It was the consensus of Council to reaffirm the previous policy in
regard to open burning, and all applicants that cannot comply with
the permit requirements noted by ordinance must come before
Council for specific approval.
There being no further discussion, meeting was adjourned.
J eW WK eill
Assistant Administrator
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