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City Council Agenda Packet 06-08-2009AGENDA REGULAR MEETING - MONTICELLO CITY COUNCIL June 8, 2009 - 7 p.m. Note: Closed Session - TDS Lawsuit 5 p.m. Workshop meeting -Audit Report 6 p.m. Mayor: Clint Herbst Council Members: Tom Perrault, Glen Posusta, Brian Stumpf and Susie Wojchouski Call to Order and Pledge of Allegiance. 2A. Approve minutes of May 26, 2009 Special Meeting 2B Approve minutes of May 26, 2009 Regular Meeting 3. Consideration of adding items to the agenda. 4. Citizen comments, petitions, requests and concerns. a. Public Service Announcements, if any: b. Marshall Smith and Dr. Mahoney -New River Medical: Annual Report 5. Consent Agenda: A. Consideration of approving new hires and departures for MCC, Streets, Parks and Sewer/Water. B. Consideration of ratifying two-year union contract. C. Consideration to approve a request for an extension of an interim use permit for the Alternative Learning Program located in an I-1 (Light Industrial) District. D. Consideration to approve a request for extension of a conditional use permit for a Planned Unit Development for Mills Fleet Farm Addition. Applicant: Mills Properties, Inc. E. Consideration to approve a request for extension of a conditional use permit for a drive-through facility in the CCD. Applicant: Masters Sa' Avenue. F. Consideration of accepting a donation of $325 from Cargill Kitchen Solutions for Flowers on Broadway $100 from Goldberg Bond for National Night Out. G. Consideration of approving 2008 Storm Water Pollution Prevention Program (SWPPP) Annual Report. H. Consideration of accepting donation from Ras Glass (formerly Glass Hut) of 2 windows 48" x 32" for Monticello DMV. Agenda Monticello City Council. June 8, 2009 Page 2 Consideration of approving an increase in the monthly payment for services performed by the Animal Control Officer. J. Consideration of accepting donation of a metal sculpture from Linda Smith in remembrance of John Komarek. 6. Consideration of items removed from the consent agenda for discussion. 7. Consideration of accepting audit report for the year ending December 31, 2008. Consideration of applying the deferred assessment for Lots 1, Block 1 River View Square to the lots in the newly created River View Square Second Addition. 9. Consideration of Electric Distribution and Transmission Franchise Ordinance and Franchise Fee Ordinance with Wright-Hennepin Cooperative Electric Association. 10. Consideration of adopting an ordinance amendment establishing a franchise agreement with Center Point Energy. 11. Consideration to review the application of trunk water and sanitary sewer charges as related to a building permit for JME Companies. 12. Department Head Report -Community Development: Development Listening Sessions. 13. Approve payment of bills for June. 14. Adjourn ~, '~; ..~ ~ ~ ~- ;= ? ~ <y k`( •~ ~~~ ~v~„ v ~ ~ w ro w b ~ b ~ a u ~ ~ ~ c W c W L v U U a a ¢ a -- O N O L .. 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A A N N N N N N N N N N N N N N N O O O O O C O O O O O C O O O O O O O O O O O O O O O O O O ~O ~D ~O ~O ~O ~O ~O ~O ~D ~O ~O ~O ~O V' ~D N N G1 1 C1 O ~ (~ G~ ^ C1 ~ Q\ C\ r ."~ C GT O~ 1 1 '~ C\ (') O O O O O O O C O O C O O N ~-- O O O O O ~ C O O O O O O O O O O O O O O a- ~. .-. ... ~-. .-. ~, .~ .-. ~. .-. .- ~. ~. Q~ J N .- ~. `. .-. ,A ? A .A A A A A A A A A A A A A A A A A w w W W w •--• N ~- -- W Vi In In ..• ~O ~O O ~ ~ ~ n T.' b ~D iD 10 ~p ~p ~O v7 ~O ~O ~p ~ ~O ~D ~O A A A A? A ~A A A A .A A A A A ~ \O ~D ~O ~O ~O ~O ~O 'V ~O ~O ~O ~O ~D ~O ry p r' ~-- ~O N ~O ~D ~D .-~ N N ~- ~C A A A A A V] ~] J J J J J J J J J J J J J J V] O~ a\ rn rn G\ A O A A A G1 O O N~~ A A A A O O O O O O C O 0 0 0 -- -- N 0 0 0 0 0 0 p .~ U U U U ~n cn l.n tr v, In v, in cn to t~ O O O O O O O O O C C O 0 0 0 m .O A A .A A A? A A A?? A~ A~ A A A A A ~ A A A A A A ~. A A A A A A A A W W W W W W W W N N W W W W W W W W W W N N W N N W N W N W N W N N W -- N N oo .-. ~• -• .-. oo .-. -. -. -. ~O ~D ~O ~D ~O ~O ~D ~ ~O ~O ~O ~O ~O ~O .-~ ~O ~O ~ ~O ~ N v~ in w cr in w vi w to w vi w v, v~ w .- w w A w .- w w w .-~ w w w ~ (D O o O O O ~O O O ~O ~O O O O o 0 0 o O o c O O O O O O O O O O O O O O O O O O O O -- O O o o O o 0 o O o o O O O O O O O O O O O O O O O O O O O '--~ A 'W ro m ao rn a m w a• rn a m m a w n. m rn O 2 z O • n ~ n x y ~ ~. m N y O ~ N ~ N .~i A d ?% A T z S Z a r A • N • • • ro w bC N N U lA l\ Vi \ U lJ~ Vi \ V~ \ U \ C' N N N N N N N N N N N ~-- ~- ~ ~. .-. .-. .... ^- .-- O O .O o0 0. O O O O C O O C O O O O C p n p ~* X U U lh N U V~ V~ ~7 U U U U C ] O O O o0 0 0 0 0 C\ O O O ~ ~ p d , p ~] ~ to cn to .-• to to In O Cn to V~ cn ~p ~ .-j Z i O ~ ~ ~ ~ ~ y ~ W ~D ~O ~O ~O G~ p O (~ O O A ~ . ~; J O oo N ~ 'JIO O A 00 ~O N A Q p F C C n S CD A ti N (n N .-. ~ J W .-. N W is V1 in O N oo ? w W J r~ In `-. 00 A `p 00 Vi G~ ? Vi C\ W J -~ ~O Oo L J O ~p W o0 1 v A ~ N to ~~ 00 ~p -~ ~C C\ O A oo O cn 0o W 11 in w in to ~D J oo O O W G1 A Gc d\ ? N 1 J W N O O O O O O O O O O O O O C\ O T C\ r 'r1 G\ D\ G1 G~ C\ T C\ .OP A~ .OA ? A A A~ A A A A N N N N N N N N N N N N N O O O O O O O O O O O O O 0 0 0 0 0 0 0 o c o 0 0 0 O O N ~- 0 0 0 0 0 0 0 `-- U S A A? A A A .A A .P ? A A n ~O ~p to to to N N N N W .-. ~ T' J A -- v~ -. ~O N A oo J .-~ ~p oo V] ~n A N O J A O O O C A ~p ~] tD A O N- to O O O C C O O O A A A ~ A A A A A A A A ? A (p w W w w W w w W W W w W W ~^} 00 00 00 00 00 JO 00 00 GO 00 00 00 00 (] O O O O O O O O O O O O O 0 0 0 0 0 0 0 0 0 0 0 0 0 -- Y n x d d O z 0 0 7 O 7 O C L7 et 2 7 d A~ ti Y n 7 G 3 7 2 2 2 Special Council Meeting Minutes: May 26, 2009 MINUTES SPECIAL MEETING - MONTICELLO CITY COUNCIL Tuesday May 26, 2009 - 5 p.m. Members Present: Clint Herbst, Tom Perrault, Glen Posusta, Brian Stumpf and Susie Wojchouski Members Absent: None 1. Call to Order. The special meeting was called to order at 5 p.m. At that time the Council entered into a closed session to discuss the legal action relating to the fiber optic project. The closed session ended at 5:30 p.m. 2. Workshop on goal setting and impact of state budget cuts. City Administrator, Jeff O'Neill presented a list of projects and goals for the Council to consider in 2009 as well as a listing of the projects and goals established in 2008. The goal setting process will take place during the course of at least two workshops. This workshop is primarily to review the existing projects and goals providing a brief description of each project/goal. The Council and staff will then review and rank the projects and at the second workshop the projects and their ranking will be evaluated. Jeff O'Neill commented on various on-going projects such as traffic concerns relating to TH 25 and the fiber optics project. The slow down of the economy has impacted the City in many ways including the number and scope of projects the City can afford to undertake. In addition potential state revenue cuts to the City will further affect the City's ability to continue to provide service to its residents at the current level. Finance Director, Tom Kelly spoke in more detail on the possible state cuts and how it will affect the City. Governor Pawlenty and the legislature were unable to come up with a tax bill that both could agree to. At this point the governor is taking on the responsibility to make cuts to the state budget by the unallotment process. With the budget cuts already in place the Market Value Homestead credit for 2009 and 2010 has been decreased by $263,000. The City has made budget adjustments to account for the loss of this aid. However, Governor Pawlenty is still talking about additional cuts to local government aid including Taconite Aid. Tom Kelly felt it is possible that the governor could cut Local Utility Transition Aid as well. The Local Utility Transition Aid for Monticello is estimated at $360,000 in 2009 and $720,000 in 2010. The governor has also raised the possibility of delaying payment of state aid to the cities. It is hoped that within the next couples of weeks Monticello will know the scope of the proposed cuts. Jeff O'Neill said the City should have a good property tax increase coming in 2011 when the improvements to the Xcel facilities are added to the valuation. Tom Kelly stated that Xcel Energy has talked about the improvements but is uncertain how much of an impact they will have on the taxes especially since some of the improvements maybe for pollution control and would be exempt. Tom Kelly said the timing of improvements and type of Special Council Meeting Minutes: May 26, 2009 improvements would have to be known before the City could determine the impact on valuation. Besides the potential cuts in state aids, Tom Kelly expressed his concern about building permit revenues. $529,000 was estimated for revenue in 2009 and through May only $86,000 in revenue has been generated from building permits. Jeff O'Neill stated many other communities have had to make significant changes as far as cutting staff and services. Tom Kelly noted that unlike most cities Monticello does not receive state aid. The worst case scenario would be if the state would cut all of Monticello's Local Utility Transition Aid. Tom Kelly also pointed out that the governor is firm on not giving in on the levy limits. The current levy limit is 3.9%. The levy limit for next year will be calculated based on what the City could have levied last year. He thought this would give Monticello approximately $60,000 more than last year. Brian Stumpf asked if unallotment cuts are made would the City be using their reserves to make up for it. Tom Kelly indicated the City would not want to deplete their reserves but did caution that if the City tries to balance their budget by deferring purchases and delaying projects it may cost more in the long run. For example if a street seal coating project is delayed for a longer period of time, the City may end up having to overlay or reconstruct the street which is a more costly project. The City has to weigh carefully what improvements or purchases can be delayed without having an adverse impact. Jeff O'Neill then listed future workshops that will be scheduled. In addition to the goal setting process, these workshops would include the audit, fiber optics, street lighting, transportation issues, facilities planning and the 2010 budget. Jeff O'Neill then read through the list of projects and goals and briefly described each. In discussion of the transportation plan, Brian Stumpf expressed his frustration with all the effort that was put into a transportation plan that will be obsolete in 5-7 years and with the fact that MnDOT will be doing nothing for 20-25 years on the transportation issues such as TH 25 and a second river crossing which have a significant impact on the city. Clint Herbst felt if the City identified sites for a second river crossing early enough, the City could keep that area open by picking up property when it becomes available. He felt it was necessary to do the planning for this type of improvement even though it maybe some years away. The Council also talked about the facility plan for the wastewater treatment plant and the feasibility of a regional venture for treating the City's wastewater. The snow removal policy was also discussed and particularly snow removal from pathways. Street Superintendent Tom Moores indicated the core pathway routes for snow removal need to be identified and the public informed about what pathways will be cleared for use. Tom Moores also brought up a street issue that came about as a result of the City's annexation agreement. When the City annexes property from the township the abutting township road becomes the City's responsibility. He noted that some of these roads are deteriorating and will need work. Brian Stumpf suggested getting a list of those streets together so the Council can see the roads involved and determine a course of action. 2 Special Council Meeting Minutes: May 26, 2009 3. Adiourn. TOM PERRAULT MOVED TO ADJOURN AT 6:50 P.M. BRIAN STUMPF SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY Recording Secretary Council Minutes: May 26, 2009 MINUTES REGULAR MEETING - MONTICELLO CITY COUNCIL Tuesday May 26, 2009 - 7 p.m. Members Present: Clint Herbst, Tom Perrault, Glen Posusta, Brian Stumpf and Susie Wojchouski Members Absent: None 1. Call to Order and Pledge of Allegiance. Mayor Herbst called the meeting to order at 7 p.m. and declared a quorum present. The Pledge of Allegiance was said. 2A. Approve minutes of Apri122, 2009 Special Meeting BRIAN STUMPF MOVED TO APPROVE THE MINUTES OF THE APRIL 22, 2009 SPECIAL MEETING RELATING TO FIBER OPTICS. SUSIE WOJCHOUSKI SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 2B. Approve minutes of Mav 11, 2009 Special Meeting SUSIE WOJCHOUSKI MOVED TO APPROVE THE MINUTES OF THE MAY 11, 2009 SPECIAL MEETING RELATING TO THE TIF ANALYSIS AND MANAGEMENT PLAN. GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 2C. Approve minutes of Mav 11, 2009 Regular Meeting BRIAN STUMPF MOVED TO APPROVE THE MINUTES OF THE MAY 11, 2009 REGULAR MEETING. SUSIE WOJCHOUSKI SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 3. Consideration of adding items to the agenda. The following items were added to the agenda: 1) Street lighting on School Boulevard; 2) Mowing the boulevard area on vacant land; 3) Drainage issue on Mill Trail Lane; 4) Watch for Children signs; 5) Congratulations and Thanks; 6) Community Garden and 7) Building Permit Fees. Mayor Herbst congratulated Susie Wojchouski on being named Citizen of the Year. 4. Citizen comments. petitions, requests and concerns. Jeff Young, a member of the Monticello Big Lake Hospital Board, questioned the resolutions that appeared on the City's website relating to support of the City's fiber optics project and submission of the project for stimulus grant funding and asked which Council Minutes: May 26, 2009 resolutions were going to accompany the grant application. He took issue with the reference in the IEDC resolution stating that there was a partnership between the City and the community's medical and hospital facilities. He stated there is no partnership in place between the City and the hospital as far as any fiber optics venture. He indicated there is a possibility of liability issues for the hospital from the implication that the hospital is involved in a fiber optics partnership with the City. Clint Herbst noted that some of the opportunities for medical use are just opportunities and are not necessarily something the hospital would be taking advantage of. Jeff Young stated the hospital district has a good relationship with TDS so he wanted to make sure the reference in the resolutions about a partnership with the hospital is taken out. Jeff O' Neill said there is potential for partnership but partnership is not implied or expressed. Clint Herbst responded that there has been, based on what has happened in the past, a partnership with the hospital and the City is merely extending an invitation to the hospital use their service. Patrick O' Donnell from Smith Paulson & O'Donnell asked for an opportunity to speak on behalf of TDS and the Council indicated he would have a chance to make his comments when the fiber optic item came up on the agenda. a. Public Service Announcements, if any: 1. Bertram Chain of Lakes Amphitheater Schedule. Angela Schumann reminded the audience of the Bertram Chain of Lakes fun event scheduled for Saturday June 13, 2009 and reviewed the amphitheater schedule of events. b. Bapa Enterprises -Liquor License: The individual did not appear before the Council. Glen Posusta asked if the Bertram Chain of Lakes event was being advertised on the cable channel. Angela Schumann indicated there is nothing at this time but there will be a live promo done by the Mayor on site. City Engineer, Bruce Westby clarified the location of the I-94 twin bridge replacement project noting the bridges being replaced cross over East Broadway and submitted a drawing showing the project location. 5. Consent Agenda: A. Consideration of approving new hires and departures for MCC, Streets, Parks and DMV. Recommendation: Ratify hires and departures as identified. B. Consideration of authorizing preparation of feasibility report including signal justification report for a signal system at School Boulevard and Cedar Street intersection. Recommendation: Authorize preparation of Feasibility Report including a Signal Justification Report for a signal system at the intersection of School Boulevard and Cedar Street. Res. #2009-31. 2 Council Minutes: May 26, 2009 C. Consideration of authorizing preparation of a feasibility report for Marvin Road improvements. Recommendation: Authorize preparation of a Feasibility Report to complete improvements on Marvin Road in 2009. Res. #2009-32 D. Consideration to authorize a resolution of support for 2010 bonding funds for the Bertram Chain of Lakes. Recommendation: Adopt a resolution supporting placement of the purchase of Bertram Chain of Lakes in the 2010 State Bonding Bill. Res. #2009-27 E. Consideration of approving final payment and acceptance of work for the WWTP Digester Mixer and Sludge Storage Improvements, City Project No. 2007-18C. Recommendation: Accept work and approve final payment for Kraemer Trucking and Excavating, Inc. in the amount of $27,695.84 for WWTP Digester Mixer and Sludge Storage Improvements, City Project No. 2007-18C. Res. #2009-29. F. Consideration of authorizing preparation of a feasibility report for Fallon Avenue pavement rehabilitation project. Recommendation: Authorize preparation of Feasibility Report for a pavement rehabilitation project on Fallon Avenue between School Boulevard and Chelsea Road in 2009. Re. #2009-33. G. REMOVED H. Consideration of approving a neighborhood block party and closure of cul-de-sac. Recommendation: Approve the temporary closing of the Badger Circle cul-de-sac on Saturday, May 30, 2009 from 3 p.m. to 9 p.m. for a neighborhood block party. I. Consideration of approving final payment and accept improvements for the Fiber Optics Head-End Building Site, Grading, and Utility Improvements, City of Monticello Project No. 2006-32C. Recommendation: Move to accept the improvements and approve the final payment of $6,362.38 to Schluender Construction, Inc. contingent upon receipt of the final paper work. Res. #2009-30. Items #SA, #SB, #SC, #SD, #SF and #SH were pulled from the consent agenda for discussion SUSIE WOJCHOUSKI MOVED TO APPROVE THE CONSENT AGENDA CONSISTING OF ITEMS #SE AND #SI. GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 6. Consideration of items removed from the consent agenda for discussion. #SA Ratify Hires and Departures: Glen Posusta noted that there were six seasonal workers added in the Streets and Parks Department. He asked why the deparhnents had not cut back on the number of seasonal workers. Public Works Director Bob Paschke indicated that the Public Works Department cut back four positions from what they would normally have had. Jeff O'Neill added that these cuts were not included in the original budget cuts. Glen Posusta felt the Public Works staff should keep in mind that they may have to cut even further. GLEN POSUTA MOVED TO RATIFY THE HIRE/DEPARTURES OF THE EMPLOYEES 3 Council Minutes: May 26, 2009 AS IDENTIFIED. BRIAN STUMPF SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. #SB Feasibiliry Report for traffic signal system at School Boulevard and Cedar Street: Glen Posusta stated the consensus of the Council at the previous discussion of this item was that they didn't want to do the project. He questioned why the project was being pushed forward especially in light of the City Attorney's comments that the City could assess the cost of the signal system to the benefitting properties if the construction takes place at some future date. He does not believe the criteria for constructing a signal system has been met. Glen Posusta said at one point Wal-Mart was considering putting in a gas station and the City could require payment for signal costs from Wal-Mart at that time. Clint Herbst questioned the verbal response received from the Wal-Mart employee and whether it came from the proper channels. Bruce Westby said the crux of the item was that if the Council wants to hold the two developers who initially signed the agreement to the financial obligation provided for in the agreement the City would have to go forward with the project at this time. Otherwise the City could assess all the benefitting properties at the time the signal system actually goes in. Clint Herbst suggested that the response from Wal-Mart needs to be pursued further. It was noted that a written response from the Wal-Mart corporate office would normally take about two months. GLEN POSUSTA MOVED TO DENY AUTHORIZING THE PREPARATION OF A FEASIBILITY REPORT INCLUDING A SIGNAL JUSTIFICATION REPORT FOR A SIGNAL SYSTEM AT THE INTERSECTION OF SCHOOL BOULEVARD AND CEDAR STREET BUT THAT CITY STAFF PURSUES GETTING A WRITTEN RESPONSE FROM WAL-MART. SUSIE WOJCHOUSKI SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. #SC Feasibility Report for Marvin Road Improvements: Tom Perrault stated he pulled this item because he was wondering what the goal of the project was. Was it to tar the road? City Engineer Bruce Westby said the feasibility report would examine all the options that the Council could consider including doing nothing to the street to doing a full paving project. Bruce Westby said the feasibility report would be done in-house. Clint Herbst asked if the staff looked at the City owned property in the area and whether it was likely that the property could be developed. Bruce Westby responded that it would be considered in preparation of the report. Susie Wojchouski said the City has spent minimal for maintenance of the road and questioned why the City would improve the road before anything develops out there. Glen Posusta said the water coming off the Gould property is causing erosion problems and he felt something should be done to correct the drainage issue. He noted if the road is improved Gould's could be assessed for a portion of the cost. Glen Posusta said the water is washing out both sides of the road. He felt the main thing is to address the drainage issue. Street Superintendent Tom Moores said the feasibility report will tell the City what is needed to correct the problem and what the options are. Tom Perrault said there is dirt stored in two places on the side of the road going down by the pond. Tom Moores 4 Council Minutes: May 26, 2009 said they are putting a couple of spillways in so the water runs towards the pond. Tom Moores said staff has done some work on the spillways. Tom Perrault asked how much time it would take. Bruce Westby indicated 2-3 days. BRIAN STUMPF MOVED TO AUTHORIZE PREPARATION OF A FEASIBILITY REPORT TO COMPLETE IMPROVEMENTS ON MARVIN ROAD, CITY PROJECT NO. 2009-4C IN 2009. SUSIE WOJCHOUSKI SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. #SD Resolution supporting State of Minnesota 2010 bonding request relating to acquisition of Bertram Chain of Lakes property: Tom Perrault pulled this item so he could vote in opposition as he has never supported the acquisition of this property. SUSIE WOJCHOUSKI MOVED TO ADOPT A RESOLUTION SUPPORTING PLACMENT OF THE PURCHASE OF THE BERTAM CHAIN OF LAKES IN THE 2010 STATE BONDING BILL. GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED WITH TOM PERRAULT VOTING IN OPPOSITION. #SF Authorization of feasibility report for Fallon Avenue Pavement Rehabilitation project: Glen Posusta wanted to know exactly what is being proposed to be done out there. Bruce Westby said right now without a study it would make sense to peel off the blacktop, reclaim it and place new blacktop down. Susie Wojchouski asked if this improvement was going to be assessed. Bruce Westby responded that he thought the work could be done with funds in the Street Reconstruction Fund. It was pointed out that they are looking at this as a temporary project because at some point in the future a deep sanitary sewer trunk line will need to be extended under Fallon Avenue. Bruce Westby thought that the sanitary sewer extension was estimated at $1,000,000 but did not believe that figure included the road construction. Tom Kelly Finance Director indicated that there is $1,800,000 in the Street Reconstruction Fund that could be utilized. Clint Herbst felt the sewer line is probably not going in for some time. Bruce Westby agreed that it may be a number of years before the sewer line goes in but the road is deteriorating and something needs to be done with it. It was suggested to expand the scope of the study to look at installation of the sewer line and full replacement of the street. Then project would be more assessable than a repair project. The project would extend the sewer to School Boulevard. The City would finish extending the sewer line beyond School Boulevard at a later date. SUSIE WOJCHOUSKI MOVED TO AUTHORIZE THE PREPARATION OF A FEASIBILITY STUDY FOR A PAVEMENT REHABILITATION PROJECT ON FALCON AVENUE BETWEEN SCHOOL BOULEVARD AND CHELSEA ROAD, INCLUSIVE OF RUNNING THE TRUNK SANITARY SEWER LINE, CITY PROJECT NO. 2009-SC IN 2009. GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. #SHNeighborhood block parry and closure of cul-de-sac: Tom Perrault noted that last year on National Night Out there was no block party in the area where the street was closed off and he just wanted to make sure there was something actually going on when the City closes off a street. Tom Moores said the Public Works Department places the barricades to close off the street and notifies the Sheriff's Department but they do not check to verify if any activity is 5 Council Minutes: May 26, 2009 actually taking place. The City would be following the same procedure with this request to close off the cul-de-sac. TOM PERRAULT MOVED TO APPROVE THE TEMPORARY CLOSING OF THE BADGER CIRCLE CUL-DE-SAC ON SATURDAY, MAY 30, 2009 FROM 3 P.M. TO 9 P.M. FOR A NEIGHBORHOOD BLOCK PARTY. BRIAN STUMPF SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 7. Public Input meeting on TH 25/River Street access closure pilot project, City Proiect No. 2008-14C. City Engineer Bruce Westby gave a presentation on the TH 25/River Street access closure project which provided background on the project. On February 29, 2009 the Council directed staff to get additional information relating to traffic statistics. Originally the project was to be a 60 day pilot study. In the first pilot study the signal system was closed down and all accesses to River Street at the TH 25 intersection were closed. Traffic counts were taken after this was done. CSAH 75 showed a 15% increase in traffic volume and River Street showed an 85% decrease in volume. The second pilot project had partial access from West River Street. Traffic volumes on West River Street increased slightly but were still less than the initial conditions. A picture depicting the location and layout of the barricades and barrels was shown. The Council requested staff to conduct additional traffic counts and run them for a two week period. These counts were taken on East and West 3`~ and 4~` Street as well as on East and West River Street. East and West 3`~ and 4t1i Street averaged 518-1127 vehicles per day. On East and West River Street the average was 213-767 vehicles per day which was less than in the previous pilot project. With the second pilot project traffic on Broadway increased slightly. The two-day traffic counts were compared with the two-week counts. Bruce Westby reviewed the data collected from the traffic counts. He noted that the data from August and September of 2008 and January 2009 were two day counts. The two week count was conducted in May of 2009 on River Street. He presented a map that showed all the locations where counts were taken. He noted some anomalies in the counts occurred when the tubes on the counters were pulled up. These anomalies were excluded from the data collected. The 85% percentile speed is the speed used determining posted speed limits. Staff was surprised by the fact that much of traffic was slightly less than 20 mph which was the 85% percentile speed. It was noted that two-tube counters were used in the traffic counts. Bruce Westby added that they tried to obtain crash data for the pilot project period but meaningful data was not available. He did check with the Wright County Sheriff's Department to see if there were any issues with the pilot project as far as crashes. Bruce Westby then opened it up for questions. Brian Stumpf asked why the speed count on 3`~ Street east of Elm on Friday May 15, 2009 was so high. Bruce Westby said it was because the tubes had been dislodged and therefore this data was not included. Brian Stumpf commented that it was amazing to him that the least speed in the community was along East and West River Street. Brian Stumpf said on 3~ and 4t1i Streets there were vehicles traveling in excess of 60 mph. Bruce Westby replied that was another instance where the tube had been dislodged. Brian Stumpf said the information 6 Council Minutes: May 26, 2009 received from this study should be passed on to the Sheriff s Department with the direction to patrol the area a little more. Glen Posusta said by doing the counts on other streets it gave the Council a comparison to what is happening on River Street. Susie Wojchouski asked if the traffic study is going to continue through the end of the month. Bruce Westby said they have completed the traffic counts. He said based on the number of vehicles between TH 25 and Walnut Street on West River Street and Linn Street and Locust street it appears that there is not as much cut through traffic as he had suspected. Bruce Westby felt if it was cut through traffic it would be going at a faster speed. Tom Perrault said he was surprised at the number of vehicles going 20 mph. He expected higher average speeds. The Council then opened the meeting up for public input. Chuck Van Heel owner of the property of the in Block 53 (old Marquette Bank /old theater building site) stated they have been putting together a development plan for the property and he would like the City to hold off making any major changes to this intersection until the development plan is firmed up. He said in this situation the site has good access. He added he would hate to see the signal light removed as the cost of putting in stop lights is exorbitant. He believes the development plan would come before the Council within the next 4-6 months. He felt the entire City block could be redeveloped and he would like to see a decision on the access delayed to see how the proposed development would work. Brian Stumpf asked if it was easier to have the buyer know for certain what the access point will be rather than what it should be. Chuck VanHeel said it depends on how the property is used. It was noted that Vantage Point had provided a letter which addressed the issue of access to the property as it exists and how it could change with redevelopment. Their recommendation was to barricade River Street at the corner of River Street and Cedar Street which they felt would allow access to the commercial business and not allow high speed traffic into the residential neighborhoods. Clint Herbst agreed extending the closure further down would allow access but not direct traffic into residential area. If the old bank building and old theater building were demolished it would be like a clean sheet. Brian Stumpf noted it is a safety concern as well. Brian Stumpf asked if MnDOT would allow an access for any kind of development. Bruce Westby responded that MnDOT would review any development plan and would comment on it. They would likely allow an existing access to remain open but probably would not allow a second access. However, if River Street is left open MnDOT might have less to say about access and Chuck Van Heel concurred with this. If the existing buildings are demolished the access issue might be looked at differently. Chuck Van Heel said there is commerce in the downtown area and it needs good access to survive. Josh Dickinson of Old Skool Kustoms at 106 Walnut Street read a prepared statement. He stated his business depends on customers getting to his place of business but closing River Street makes it difficult for customers to get to his location. The City has not created a benefit to the community or its businesses by the closure of River Street but instead has caused harm to the business owners downtown. Denying traffic on River Street as increased the traffic on Broadway. As traffic volumes rise people are less inclined to spend time in the downtown area. He said the closure of River Street has not saved time in traffic but has hurt the business district and the downtown area. He would request that River Street be opened and the signal light turned on. 7 Council Minutes: May 26, 2009 Joe Mahoney, a resident of 425 West River Street thanked the City for doing the second count. He was present to ask about future plans for the area. They have children and there is no sidewalk in this area. He was aware that the sidewalk issue came up at previous meeting and that the area residents were instructed to submit a petition requesting sidewalks to the City. He also requested that the Council consider placing a stop sign on River Street. He asked when the City had planned to resurface River Street and if sidewalk would be included as part of that project. Clint Herbst replied that the City has some serious sanitary sewer work that needs to be done in the area so it is difficult to say when the City would be doing the resurfacing work on River Street. As far as the sidewalk petition, Clint Herbst felt it would be good for the City to have that petition on file when the project came up. He added that placing a stop sign on a street is not meant as a speed control device and questioned whether traffic on River Street warranted a stop sign. Bret Weiss from WSB reported that he has talked with Matt Theisen the City's Water Superintendent about rerouting the sanitary sewer so it would be less expensive. Clint Herbst suggested the residents get a petition to the City for the sidewalk. Joe Mahoney said he is willing to be the contact person on getting the petition. City Engineer Bruce Westby will keep Mr. Mahoney abreast of the situation. Jodie Dickinson, 112 West River Street, (Biff s Garage) read a prepared statement. He is a business owner in the downtown area and the only legal access to his building is one block from TH 25. The second pilot project did not benefit his business. He too noted that customers have a difficult time in getting to his business. He did not feel the City met the goal they were trying to attain by closing River Street. The future of businesses downtown depends on access. He requested that River Street be re-opened and the signal light activated. He also stated that the cone layout was very confusing to traffic. Glen Posusta asked if some type of reflective devices could be used to more clearly mark the lanes. Glen Posusta said it's important to educate the driving public to the street layout and what lane they are in so that there is not crossover to the other lane. Bruce Westby said the City did try striping and he will talk to the County about marking suggestions. Dean Rasmussen, Vice Chair of Monticello Downtown Business Association (MDBA) said the group is working to promote downtown business. They are a newly formed group and their members want to keep River Street open both ways. There are four parks on River Street and two of them are in the downtown area. There are no pedestrian crosswalks for access to the parks. The park can only be accessed by going under the bridge. He felt the City was more concerned about getting traffic through downtown than they are about the people who live in the City. He said speed is the main concern throughout the City and he felt that should be better monitored. He felt the business and residents on River Street could work together on the issue. He believes that River Street should be open to Linn Street on the west and to Cedar Street on the east. Mike Drayna, 13 Linn Street commented on the proposal made by Old Skool Kustom Cars. He said enforcement is needed because so many of the cars do not stop. There was some discussion on the cost of the sheriff s protection and the time spent on patrol. He also questioned why stopping for pedestrians in a crosswalk was not being enforced. He said overall he was disappointed with the enforcement in Monticello and specifically the speeding. Staff indicated this item should be placed on the next Police Commission agenda. Clint Herbst 8 Council Minutes: May 26, 2009 felt it should be taken to Sheriff Miller rather than go to the Police Commission. Clint Herbst said that part of the problem is that there is only one river crossing in the area. The purpose of getting traffic through the City is to make life easier for City residents. Clint Herbst felt Broadway was better designed to take traffic than River Street. Brian Stumpf said on the March police report 8 tickets were issued for speed related violations and he felt this could be beefed up. He also noted that customers are cutting through the Glass Hut parking lot as well as the old theater parking lot. Bob Somerville, 213 East River Street said he empathized with the business people and what they are going through. He felt it was great to have slower traffic through the residential area. He suggested reducing the speed limit to 20 or 25 mph. He stated his personal experience is that vehicles are traveling at speeds much in excess of 20-25 mph. Brian Stumpf said whatever the speed limit is established at it has to be enforced. By statutes the speed limits on city streets are 30 mph unless posted otherwise. Given a choice he also felt all residents would request the 25 mph limit. Brian Stumpf pointed out that certain types of police calls can take up to several hours in response time so in those circumstances actual patrol time is reduced. Bruce Westby said the Sheriff will be coming to one of the Council meetings in June to review the 2008 annual report and other issues relating to enforcement. Brian Stumpf said the City is trying to balance the needs and desires of the residents and business owners. The reason the City did pilot projects and traffic studies is so they have good reliable information to use in making a sound decision. He added he realizes not everyone will be happy with the decision Josh Dickinson asked if there were any speed limits signs posted on these streets. Glen Posusta said unless it is posted the speed limit is 30 mph. Josh Dickinson said because of the number of speeders perhaps posting the 30 mph signs is necessary. Staff did not know how many local streets were posted for 30 mph. Susie Wojchouski suggested getting several movable signs that say something to effect that "the City enforces the 30 mph speed limit on city streets" and move them to various locations throughout the city. Tom Perrault asked about posting signs stating that the statute requires motor vehicles to stop for pedestrians in the crosswalks. Bruce Westby said the City had erected such signs but they were damage and are now being repaired. Tom Perrault stated at the last Police Commission meeting, the Sheriff's office said people are not speeding as much or driving as much as usual. Brian Stumpf said he is open to the various suggestions made on the River Street access except for turning the signal light back on. Susie Wojchouski commented on the traffic saying she has heard people say they do not come to Monticello to shop anymore because of the traffic. The significant impact for her on this project is Chuck Van Heel's proposed development being four months out. She asked if the City could look at Linn Street and some other streets as by-pass areas. When redevelopment will happen it will bring excitement to the downtown area. Susie Wojchouski felt the City should leave things as they are but do not remove the signal light yet. The City needs to look at development in the downtown area and keep access to the businesses. Glen Posusta asked about 3rd and 4th Streets and in allowing full turning movements at these 9 Council Minutes: May 26, 2009 locations and would the City allow it on River Street. He cited Wells Fargo Bank location as an example where at that intersection a vehicle can turn left or right onto TH 25. Bruce Westby said he would have to look at it. There is the possibility that the bridge railing would make it difficult for that option. Jeff O'Neill said the original reason for the signal light was because of the proximity of the buildings to the roadway. Josh Dickinson noted the speeders that come out of the alley block traffic. He felt there should be a defined place where to turn. Drivers are using the alley to turn left rather than using the street. Bruce Westby will check into that option of allowing full turning movements. Brian Stumpf asked what the City hoped to accomplish by doing this. Glen Posusta said it would allow more traffic from downtown to get across the river. Brian Stumpf felt that the City had done enough pilot projects and that a decision needed to be made now. Bret Weiss said the left turn coming out is the movement that MnDOT is most concerned with because the driver is crossing traffic coming from one direction and looking at traffic coming from the other direction. The only way MnDOT would allow this is with the signal light. Brett Weiss said a lot of options could be considered but he felt it was unlikely that MnDOT would allow the left turn movement. Bret Weiss said 3rd and 4th Street are more open intersections and therefore full turning movements would less risky than on River Street.. Clint Herbst agreed with Brian Stumpf that the signal should not be turned on again. He felt the River Street access was just one piece of the puzzle which includes improvements to County Road 11 and the Fallon Overpass which will help improve traffic. Susie Wojchouski said she is not willing to get rid of the light even though she doesn't want it on now. SUSIE WOJCHOUSKI MOVED TO LEAVE THE ACCESS AS IS FOR THE PRESENT TIME WITH THE SIGNAL 1N PLACE AND WITH A POSSIBLE DEVELOPMENT OFFER HAPPENING 1N A SHORT TIME FRAME THE CITY WOULD LOOK AT THIS INTERSECTION ACCESS AGAIN. GLEN POSUSTA SECONDED THE MOTION. Brian Stumpf suggested that the City do something with the configuration of the barrels. Bruce Westby said the pilot study was for 60 days so MnDOT is expecting them to do something with the barrels. Brian Stumpf asked at what point does MnDOT step in and require the City do something. Bruce Westby thought it would be a couple of months. He felt the existing set up was working okay and that MnDOT would not push to change it. Tom Perrault believes River Street should be closed at Linn Street with barricades on the west side of Linn Street. He wants the signal light to remain but closing River Street off at Linn Street should be the next pilot project. Clint Herbst did not feel this was the problem area. Tom Perrault said any vehicle turning off southbound TH 25 would have Linn Street to go to. Brian Stumpf would like to see addressed in any motion that something be done differently with the barrel configuration. Clint Herbst said no one has expressed interest in opening up East River Street and he is not hearing a lot of concern about traffic on River Street as compared to other areas. The issue the City is looking at is what is happening with redevelopment and retaining the option to block traffic at Cedar Street. Bruce Westby said he would want to talk to MnDOT as to how long they would let the City continue with the intersection study. 10 Council Minutes: May 26, 2009 Bret Weiss said the Walnut Street access maybe closed at some point in the future. He felt the City needed to check out the circulation movements for the entire downtown area. Delaying action on the matter for several months because of possible redevelopment would put the City into September which makes it more difficult to get things done. Clint Herbst asked what would take the place of the barrels. Bruce Westby said curb would be installed and it would be laid out as a turn lane. Clint Herbst suggested looking at this project in 2-3 months rather than waiting a longer period of time for the possible development as he felt the City needed to make a decision. Susie Wojchouski said she would like the area evaluated when the County Road 11 turn lanes come through and the Vantage Point development takes place. Glen Posusta felt with Pat Sawatzke on the County Board it would be unlikely that the Walnut Street access would be closed off. Bret Weiss suggested looking at all the movements in the area and not just focus on this one part of it. The original plan at one time was that Walnut Street would go through all the way to the River. Brian Stumpf felt some of the research on other options and contacts with other parties should have been done while the pilot project was taking place. Susie Wojchouski said the City doesn't control access on Broadway or River Street so they should not give up existing access. Tom Moores indicated that state patrol had informed him of an incident in the southbound lane so safety is a concern in this area. Clint Herb felt the incident could have been a result of the barrel configuration being confusing. Bruce Westby suggested doing something with signing to make the barrel area safer. SUSIE WOJCHOUSKI MOVED TO KEEP THE RIVER STREET/TH 25 INTERSECTION AS IS UNTIL THE CITY KNOWS HOW TRAFFIC PATTERNS WOULD BE CHANGED FROM THE COUNTY ROAD 11 TURN LANES AND THE POTENTIAL DEVELOPMENT OF BLOCK 53. Bruce Westby noted that the turn lanes for County Road 11 would not take place until next year. Susie Wojchouski said the city could not wait that long. Clint Herbst didn't think the City should worry about development on that block unless they wanted to keep the light. Glen Posusta suggested revisiting this in six months or December 1 S` SUSIE WOJCHOUSKI AMENDED HER MOTION TO INCLUDE THE DECEMBER 1, 2009 TIME FRAME FOR REVISITING THIS ITEM AND HAVE THE CITY ENGINEER PROVIDE SAFETYRECOMMENDATIONS FOR THE AREA OF THE BARRICADES. GLEN POSUSTA AMENDED HIS SECOND. Clint Herbst felt a decision should be made now. Tom Perrault said he would not vote for it because he felt River Street should closed off at Linn Street and he felt the Linn Street closure should be a pilot study. He requested that the motion be amended to include the Linn Street closure but no amendment was made. UPON VOTE BEING TAKEN COUNCIL MEMBERS WOJCHOUSKI AND POSUSTA VOTED IN FAVOR THEREOF AND COUNCIL MEMBERS HERBST, PERRAULT AND STUMPF VOTED AGAINST. THE MOTION FAILED. 11 Council Minutes: May 26, 2009 Josh Dickinson asked what was the reason for the River Street closure and is it still a valid reason. Glen Posusta asked Clint Herbst his reason for voting against the motion. Glen Posusta felt if the development comes and there is different access the lights would be on again. Clint Herbst reiterated that he doesn't believe in turning the lights back on. Susie Wojchouski felt at some point the City might need the lights again. Val Somerville brought up the pedestrian safety issue stating that people are crossing where they should not be crossing and asked that the Council take that into consideration. Clint Herbst suggested as an alternative that the present situation be made permanent thus excluding East River Street and the possible development. He suggested putting curb and gutter and turn lanes in. Brian Stumpf said he would go with the options presented as long as it did not include the turning the signal light on again or doing additional pilot studies. Chuck Van Heel spoke again stating that one thing that is being overlooked is the safety issue as far as the park system. He disagreed with Brian Stumpf s position on the signal light since at this time they don't know what is going to happen in that area. As far the December 1st time frame he felt something on the proposed development could be presented to the City within three months. Chuck Van Heel agreed with Bret Weiss on doing some review of the downtown area. He felt additional markings would increase driver awareness. He would suggest tabling action on this matter to see what the various needs are. Susie Wojchouski asked if there was support for a pilot project to close River Street on the west side of Linn Street. There was discussion on the various options that were suggested. It was felt most of the local traffic problem is on 3~ Street. Tom Perrault felt by closing it at Linn Street the City is keeping traffic in the business area and out of the residential area. Clint Herbst said the City has already closed off many of the accesses on Broadway. Bret Weiss suggested tabling this for a couple of weeks to meet with businesses in the area and come back with a couple of options for the Council to consider. CLINT HERBST MOVED TO TABLE THIS MATTER UNTIL THE SECOND MEETING IN JUNE WITH STAFF TO REPORT BACK ON THE VARIOUS OPTIONS. Brian Stumpf said he did not want drivers racing down River Street to trip the lights so they could get out of town faster GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED WITH BRIAN STUMPF VOTING IN OPPOSITION. 8. REMOVED FROM AGENDA 9. Consideration of approving summary of grant application for stimulus funding supporting fiber optic project along with related actions. Jeff O'Neill gave a history of the City's fiber optics project. The project was not a City initiated project and was supported by many entities and the general public as indicated in the referendum vote on the project. The City established a task force to look at the issues involved 12 Council Minutes: May 26, 2009 and to set goals. It was felt providing the fiber system to the residents of the City would help the City to compete and create jobs. As part of this project the City undertook various feasibility studies and upon determining that the project was feasible, revenue bonds in the amount of $26,000,000 were issued. The filing of a lawsuit by TDS against the City resulted in the bond monies being placed in escrow. The federal stimulus grant provides another funding source for the City to utilize in proceeding with the project. Jeff O'Neill said the City's project closely matches the federal award criteria and he feels the City's project has a favorable chance of being funded. Because some of the work has been initiated and other work is ready to be awarded he felt the City's project was "truly shovel ready" and that is a criteria of the grant program. The grant program is 80% funded by the federal government with a 20% match from the entity sponsoring the project. The City should receive the grant application materials some time between May 27th and June 16th. Staff will try to get the grant application processed as quickly as possible. Jeff O'Neill talked about the City's goal to reach the portion of the population that is underserved or is not using the technology because of financial considerations or lack of training or knowledge of the technology. The City is attempting to work with anon-profit group called One Economy to build a program to help bring this group into the technology era. Part of this program would include the distribution of lap tops for this segment of the population and training in the technology. The cost of this program would be included in the grant package. Don Patten updated the Council on the operation aspects of the system . He indicated service will be available June 13th. They are focusing on concentrated su~port areas such as the Oakwood Industrial Park and the commercial area along 6th and 7t Street. He indicated there are 132 drops which is up from the original estimate of 60 address drops. The Council is being asked to consider acting on the following items: Motion to award the bid for the 2009 Fiber-to-the-Premise project, City Project No. 2009-02C to MP Nexlevel of Maple Lake, Minnesota contingent on successful project financing. Bids for the project were received on May 6, 2009 with MP Nexlevel being the lowest of three bidders with a price of $9,345,427 base bid and $9,945,014 prevailing wage bid. Bids are good for 90 days from the date of opening so the City has up to August 6, 2009 to award the project. The bid does not include the cost to extend services beyond the City limits. 2. Motion to authorize the initiation of the hiring process for a service technician to operate the existing fiber backbone and if grant funds are received help in the completion and operation of the larger fiber optics footprint. This employee would stay on regardless of whether the City receives funding for the larger fiber optics project. The funding for this position will come from funds on hand and will be paid back from revenue generated by the project. 3. Motion to authorize City participation in funding the 20% match. 13 Council Minutes: May 26, 2009 Jeff O'Neill discussed some of the options available for funding the 20% match particularly issuing new revenue bonds. These bonds would cover the 20% match as well as reimburse the City for other costs incurred or those that are not covered by the grant. Tom Perrault asked if the bids were good for either the grant funds or revenue bonds. Jeff O'Neill indicated that bids would allow utilizing either source. Patrick O'Donnell representing TDS spoke on the City's intention to apply for stimulus grant funding. He stated TDS is a local and state taxpayer and the City Council should be made aware of the letter from the US Congress that was sent to the Federal Communications Commissions (FCC) and other entities on May 20, 2009. This letter stated they should give preference to communities that have no broadband service. Mr. O'Donnell also submitted a letter from TDS to the Minnesota Ultra High-Speed Broadband Task Force which outlined the services provided by TDS and included a map showing their service area, the areas where 25 mbps of speed or greater is available, the areas where 10 mbps speed is available and the area not served by TDS. In addition Mr. O'Donnell went on to explain not only the type of service provided by TDS but the cost for service. He stated that there is no area in the City of Monticello or Monticello Township that is not served by broadband. He felt the City's application for stimulus funding monies will reflect poorly on the City because: 1) The City project does not qualify for funding because the area already has broadband service; 2) A grant to the City of Monticello would be duplicative and wasteful of taxpayers money; 3) A grant to City that would compete for customers that are currently using two existing business would not stimulate the local economy; and 4) Awarding stimulus grant money to a project in an area serviced by broadband would reduce the amount of grant money available to use in areas that are not served by any broadband. TDS believes that this project should be rejected for federal stimulus funding. Clint Herbst questioned the veracity of the information contained in the letter that was submitted. He explained the City tried to resolve this issue before it got to this point. The City acted on initiating a broadband project because TDS indicated they would not be doing so. TDS did not initiate any project until after the City acted. Patrick O' Donnell disputed some of the comments made by Clint Herbst. The question was raised whether there was any chance of the two entities working together. Patrick O' Donnell stated that TDS has the facilities in place and is serving the community. He felt the Mayor was posturing and forcing him into posturing which was not a productive situation. He felt there are common goals that could be worked on but he didn't think it could be done in the public forum. Clint Herbst said TDS took them to the point of no return. Both he and Glen Posusta questioned the accuracy of the statements made by TDS. They said they were told previously by TDS that they did not intend to put fiber in the ground so that is why the City acted. There was continued discussion on the positions of both TDS and the City. Patrick O'Donnell reiterated his statement that this kind of discussion in a public forum would not be productive and thanked the Council for their time in allowing him to make his comments. 14 Council Minutes: May 26, 2009 Tom Perrault asked if the digital connection study comes out of grant. It was noted not all of this would be covered by grant funding. GLEN POSUSTA MOVED TO ADOPT A RESOLUTION AUTHORIZING SUBMITTAL OF AN APPLICATION FOR ECONOMIC STIMULUS FUNDING SUPPORTING THE FIBERNET PROJECT AND APPROVAL OF RELATED ACTIONS AWARDING THE BID FOR THE 2009 FIBER TO THE PREMIS PROJECT TO MP NEXLEVEL OF MAPLE LAKE, MINNESOTA CONTINGENT ON SUCCESSFUL PROJECT FINANCING; AUTHORIZE THE INITIATING OF THE HIRING PROCESS FOR A SERVICE TECHNICIAN AND AUTHORIZE THE CITY PARTICIPATION IN FUNDING THE 20% MATCH. CUNT HERBST SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. Susie Wojchouski asked about the letters of support and Jeff O'Neill indicated they would be submitted with the grant application. Tom Perrault asked if they knew what strings would be attached with the grant funds such as adoption of certain policies. Jeff O'Neill indicated that would not be known until the criteria for the grant funding comes out. Susie Wojchouski asked if the Council will get the grant funding information. Jeff O'Neill responded that the Council will receive the information but the time frame does not allow for time to convene a meeting of the Council prior to the grant application being submitted. Added Items Drainage Issue Mill Trail Lane: Tom Perrault brought the Council and staffls attention to a drainage problem that exists behind 9681, 9693 and 9709 Mill Trail Lane. There is a build up of silt in the area and runoff water is standing in the area. Staff reported they had looked into this previously. At that time Tom Moores indicated the City had cleaned out the connection between the two ponds and did some other minor corrective work as well. Staff will check the area out again. Signs: Tom Perrault noted that he has seen a home made "Slow Down for Children sign in the middle of the 3rd Street and asked if there were any guideline on this. Tom Moores said the home made signs are not allowed as individuals cannot place traffic control devices in the street or on the side of the street. He did talk to the property owners about the placements of the sign. Tom Moores will put the temporary crosswalk at Maple and 3rd Street in an effort to slow the traffic in that area. Clint Herbst asked if it was possible to place a camera on the speed trailer and identify those speeding vehicles. Lights on School Boulevard: Glen Posusta said he noticed this item was referenced in the green sheet the Council received. Bruce Westby said staff is currently working on a striping project for School Boulevard and will be posting new speed limit signs. It is proposed to bring the street lighting project before the Council along with the striping plan. As part of the striping plan staff would look at removing the crosswalk that runs between the two ponds. If the crosswalk is relocated it would affect the location of the lights. Glen Posusta asked for a time frame. Bruce Westby replied the striping plans in place and they have received the results of the speed study and they just need to complete the street lighting portion. He anticipates the report would be ready for the second meeting in June. Mowing boulevard area: Glen Posusta questioned why staff didn't mow the boulevard areas on vacant land. He cited the area around Freeway Fields as an example. Tom Moores responded that if 15 Council Minutes: May 26, 2009 the Council directs staff to do so they will but normally the property owner is notified that it is their responsibility to maintain the boulevard area. Tom Moores will contact the property owner in the area noted. Congratulations and Thanks: Tom Perrault congratulated Susie Wojchouski on being named Citizen of the Year and congratulated Bruce Anderson on his recent marriage. He also thanked all those who organized and participated in the Memorial Day events at Ellison Park and Riverside Cemetery. Signs: Tom Perrault asked about the placement of the "Noise ordinance enforced" sign in the area of the old Marquette Bank Building. Tom Moores said it was the City's sign and it was placed at that location because semis that were coming through town had their jake brakes on which created considerable noise. Building Permit Fees: Clint Herbst felt the amount charged on building permit fees should be reviewed and directed staff to bring this item back at a future meeting. He suggested that a committee be formed to review this. Community Garden: Clint Herbst commented on the nice job that was done by the Public Works staff in laying out the community garden and constructing the shed and signage for the facility. The community garden is up and running. 10. Approve payment of bills for May. Glen Posusta questioned the repair cost for the Welcome to Monticello signs. Tom Kelly indicated that the signs were damaged in the hail storm last year and the City has been reimbursed by the insurance company. SUSIE WOJCHOUSKI MOVED TO APPROVE PAYMENT OF THE BILLS. GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 11. Adiourn TOM PERRAULT MOVED TO ADJOURN AT 11:05 P.M. SUSIE WOJCHOUSKI SECONDED MOTION. MOTION CARRIED UNANIMOUSLY. Recording Secretary 16 Council Agenda: June 8, 2009 SA. Consideration of approving new hires and departures for MCC, Streets, Parks and Sewer/Water. (JO) A. REFERENCE AND BACKGROUND: The Council is asked to ratify the hiring and departures of employees that have occurred, recently at the MCC, Streets, Parks and Sewer/Water. It is recommended that the Council officially ratify the hiring/departure of all new employees including part-time and seasonal workers. A.1 BUDGET IMPACT: None A.2 STAFF WORK LOAD IMPACT: Until the positions are filled again, existing staff would pick up those hours. B. ALTERNATIVE ACTIONS: 1. Ratify the hire/departures of the employees as identified on the attached list. C. RECOMMENDATION: By statute the City Council has the authority to approve all hires/departures. There is no other recommendation but for the Council to exercise the authority given to them by state statute. D. SUPPORTING DATA: List of new employees. NEW EMPLOYEES Name Title Department Hire Date Class Jaymon DeMarais Seasonal W & S W & S 05/18/09 Seasonal David Mitchell Seasonal W & S W & S 05/18/09 Seasonal Ryan Thompson Seasonal Streets Worker Streets 05/18/09 Seasonal Scott lano Seasonal Parks Worker Parks 05/11/09 Seasonal Joseph Brooks Seasonal Parks Worker Parks 05/11/09 Seasonal TERMINATING EMPLOYEES Name Reason Department Last Day Class Jesse Hilton Involuntary MCC 05/12/09 PT Elizabeth Palmquist Voluntary MCC 01/10/09 PT council_employee list.xls: 5/26/2009 SB. Consideration to ratify the April 1, 2009-March 31, 2011 negotiated Labor Agreement between the City of Monticello and the International Union of Operating Engineers, Local 49. A. REFERENCE AND BACKGROUND City Council is asked to ratify the 2009-2011 contract negotiated between the City of Monticello and the International Union of Operating Engineers, Loca149. The current two (2) year contract expired on March 31, 2009. Members of the Personnel Committee along with Public Works Director, Bob Paschke meet with the Union Representative and Stewards on two occasions to negotiate this contract. Below are the changes agreed to for the 2009- 2011 contract period: • Keep comp time cap at 80 hours but unable to use more than 80 hours per calendar year. Comp time use is not guaranteed; needs to be pre-approved by supervisor. *Choosing the use comp time instead of vacation could result in a loss of vacation (See city policy regarding vacation carry over). • Pay for 2009 and 2010 will be adjusted by whatever rate non-union employee pay is adjusted; Adjustments will occur on contract renewal dates. • Pay at 1 '/2 times regular rate for hours worked on Saturday and Sunday (only if over 40 hours in workweek). Pay hours worked on all City holidays at 2 times regular rate regardless of how many hours are worked. The City's workweek is Saturday-Friday. • The City does reserve the right to manage OT worked for employees who are not regularly scheduled on Saturday and/or Sundays by sending employees home early on Friday if they have 40 hours in the workweek. • Holidays and sick time will count towards hours worked when calculating OT. Vacation and comp time will not count towards hours worked when calculation OT. • Update vacation schedule to reflect vacation schedule that was in 2005-2007 contract. B. ALTERNATIVE ACTIONS 1. Motion to ratify the 2009-2011 Union Contract. 2. Motion to not ratify the negotiated 2009-2011 Union Contract. C. STAFF RECOMMENDATION Staff recommends Alternative Action 1. D. SUPPORTING DATA Copy of the 2009-2011 negotiated contract Copy of specific changes to the contract LABOR AGREEMENT BETWEEN CITY OF MONTICELLO AND INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL NO. 49 AFL-CIO APRIL 1, 2009 Through MARCH 31, 2011 TABLE OF CONTENTS ARTICLE I Purpose of Agreement ........................................ 1 ARTICLE II Recognition ......................................................... 1 ARTICLE III Union Security .................................................... 2 ARTICLE IV Employer Security ............................................... 2 AF~TICLE V Employer Authority .............................................. 2 ARTICLE VI Employee Rights-Grievance Procedure ............... 3 ARTICLE VII Definitions ............................................................ 5 ARTICLE VIII Savings Clause ..................................................... 6 ARTICLE IX Work Schedules .................................................... 6 ARTICLE X Overtime Pay ........................................................ 6 ARTICLE XI Legal Defense ........................................................ 8 ARTICLE XII Right of Subcontract .............................................. 8 ARTICLE XIII Discipline ................................................................ 8 ARTICLE XIV Seniority ................................................................. 8 ARTICLE XV Probationary Periods .............................................. 8 ARTICLE XVI Safety ..................................................................... 8 ARTICLE XVII Job Posting ............................................................. 9 ARTICLE XVIII Group Insurance Program ...................................... 9 ARTICLE XIX Holidays .................................................................. 10 ARTICLE XX Vacation Leave ........................................................ 10 ARTICLE XXI Sick Leave ................................................................ 11 ARTICLE XXII Severance Pay .......................................................... 12 ARTICLE XXIII Waiver ....................................................................... 14 ARTICLE XXIV Education Compensation .......................................... 14 ARTICLE XXV Clothing/ Uniform Allowance .................................... 14 ARTICLE XXVI Duration ..................................................................... 15 APPENDIX #1 Salary Schedule for Years 2009 and 2010 ............... 16 APPENDIX #2 Group Life and Medical Insurance Benefit Schedule..18 LABOR AGREEMENT BETWEEN CITY OF MONTICELLO AND INTERNATIONAL UNION OF OPERATING ENGINEERS LOCAL NO. 49, AFL-CIO ARTICLE I Purpose of Agreement This agreement is entered into between the City of Monticello, hereinafter called the Employer, and Local No. 49~ International Union of Operating Engineers, hereinafter called the Union. The intent and purpose of this agreement is to: 1.01 Establish certain hours, wages, and other conditions of employment; 1.02 Establish procedures for the resolution of disputes concerning this agreement's interpretation and/or application; 1.03 Specify the full and complete understanding of the parties; and 1.04 Place in written form the parties' agreement upon terms and conditions of employment for the duration of the agreement. The Employer and the Union, through this agreement, continue their dedication to the highest quality of public service. Both parties recognize this agreement as a pledge of this dedication. ARTICLE II Recognition 2.01 The Employer recognizes the Union as the exclusive representative under Minnesota Statutes, Section 179.71, Subdivision 3, in an appropriate bargaining unit consisting of the following job classification(s): Grade 9 Equipment Mechanic/Operator Grade 10 Shop Mechanic/Operator -Grade 10 Operator/Mechanic Foreman The wage rates for such classification(s) are set forth in Appendix #1. 2.02 It is agreed that supervisory employees not covered by this agreement may perform work usually performed by bargaining unit employees. The Employer agrees that the performance of this work by supervisory personnel will not be for the sole purpose of avoiding overtime payment to bargaining unit personnel. ARTICLE III Union Security In recognition of the Union as the exclusive representative, the Employer shall: 3.01 Deduct from each payroll period an amount sufficient to provide the payment of dues established by the Union from the wages of all employees authorizing in writing such deduction, and 3.02 Remit such deduction to the appropriate designated office of the Union. 3.03 The Union may designate certain employees from the bargaining unit to act as Stewards and shall inform the Employer in writing of such choice. 3.04 The Union agrees to indemnify and hold the Employer harmless against any and all claims, suits, orders, or judgments brought or issued against the City as a result of any action taken or not taken by the City under the provisions of this article. ARTICLE IV Employer Security 4.01 The Union agrees that during the life of this agreement it will not cause, encourage, participate in, or support any strike, slowdown, or other interruption of or interference with the normal functions of the Employer. 4.02 Any employee who engages in a strike may have his (her) appointment terminated by the Employer effective the date the violation first occurs. Such termination shall be effective upon written notice served upon the employee. 4.03 Ari employee who is absent from any portion of this work assignment with permission or who abstains wholly or in part from the full performance of his (her) duties without permission from his (her) Employer on the date or dates when a strike occurs is prima facie presumed to have engaged in a strike on such date or dates. 4.04 An employee who knowingly strikes and whose employment has been terminated for such action may, subsequent to such violation, at the discretion of the Employer, be appointed or reappointed or employed or re-employed, but the employee shall be on probation for two years with respect to such civil service status, tenure of employment, or contract of employment as he (she) may have theretofore been entitled. 4.05 No employee shall be entitled to any daily pay, wages, or per diem for the days on which he (she) engaged in a strike. ARTICLE V Employer Authority 5.01 The Employer retains the full and unrestricted right to operate and manage all manpower, facilities, and equipment; to establish functions and programs; to set and amend budgets; to enact, modify, or eliminate ordinances; to determine the utilization of technology; to establish and modify the organizational structure; to select, direct and determine the number of personnel; to establish work schedules and to perform any inherent managerial function not specifically limited by this agreement. 2 5.02 Any term and condition of employment not specifically established or modified by this agreement shall remain solely within the discretion of the employer to modify, establish, or eliminate. 5.03 Part-time or seasonal employees may only operate motor vehicles if they are properly licensed by the State. ARTICLE VI Employee Ruts - Grriev~ance Procedure 6.01 Definition of a Grievance - A grievance is defined as a dispute or disagreement as to the interpretation or application of the specific terms and conditions of this agreement. 6.02 Urion Representatives -The employer will recognize representatives designated by the Union as the grievance representatives of the bargaining unit having the duties and responsibilities established by this Article. The Union shall notify the Employer in writing of the names of such :Union Representatives and of their successors when so designated. No Union business shall be conducted on the Employer's time except with the express permission of the Employer. 6.03 Processing of a Grievance - It is recognized and accepted by the Union and the Employer that the processing of grievances as hereinafter provided is limited by the job duties and responsibilities of the employees and shall therefore be accomplished during normal working hours only when consistent with such employee duties and responsibilities. The aggrieved employee and the Union Representative shall be allowed a reasonable amount of time without loss in pay when a grievance is investigated and presented to the Employer during normal working hours, provided the employee and the Union Representative have notified and received the approval of the designated supervisor who has determined that such absence is reasonable and would not be detrimental to the work programs of the Employer. 6.04 Procedure -Grievances, as defined in Section 6.01, shall be resolved in conformance with the following procedure: Step 1: An employee claiming a violation concerning the interpretation or application of this agreement shall, within twenty-one (21) calendar days after such alleged violation has occurred, present such grievance to the employee's supervisor as designated by the Employer. The Employer designated representative will discuss and give an answer to such Step 1 grievance within ten (10) calendar days after receipt. A grievance not resolved in Step 1 and appealed to Step 2 shall be placed in writing setting forth the nature of the grievance, the facts on which it is based, the provision or provisions of the agreement allegedly violated, and the remedy requested and shall be appealed to Step 2 within ten (10) calendar days after the Employer designated representative's final answer to Step 1. Any grievance not appealed in writing to Step 2 by the Union within ten (10) calendar days shall be considered waived. Step 2 If appealed, the written grievance shall be presented by the Union and discussed with the Employer designated Step 2 Representative. The Employer designated representative shall give the Union the Employer's Step 2 answer in writing within ten (10) calendar days after receipt of such Step 2 grievance. A grievance not resolved in Step 2 may be appealed to Step 3 within ten (10) calendar days following the Employer designated representative's final Step 2 answer. Any grievance not appealed in writing to Step 3 by the Union within ten (10) calendar days shall be considered waived. 3 Step 3: If appealed, the written grievance shall be presented by the Union and discussed with the City Administrator. The City Administrator shall give the Union the City Administrator's answer in writing within ten (10) calendar days after receipt of such Step 3 grievance. A grievance not resolved in Step 3 may be appealed to Step 4 within ten (10) calendar days following the City Administrator's final answer in Step 3. Any grievance not appealed in writing to Step 4 by the Union within ten (10) calendar days shall be considered waived. St' ep 4: If the grievance is still unsettled, the Union may, within ten (10) calendar days after the reply of the Step 3 representative was due, by written notice to the Employer, petition the Bureau of Mediation Services for assistance in settling through mediation. If either party determines during the mediation process that further mediation would serve no purpose, the Union may within ten (10) days by written notice to the Employer request arbitration of the dispute. .Step 5: A grievance unresolved in Step 4 and appealed in Step 5 shall be submitted to arbitration subject to the provisions of the Public Employment Labor Relations Act of 1971. If the Union and Employer are unable to reach a mutual agreement on the selection of an arbitrator, then the selection of an arbitrator shall be made in accordance with the "Rules Governing the Arbitration of Grievance" as established by the Public Employment Relations Board. 6.05 Arbitrator's Authority (A) The arbitrator shall have no right to amend, modify, nullify, ignore, add to, or subtract from the terms and conditions of this agreement. The arbitrator shall consider and decide only the specific issue(s) submitted in writing by the Employer and the Union and shall have no authority to make a decision on any other issue not so submitted. (B) Then arbitrator shall be without power to make decisions contrary to, inconsistent with, or modifying or varying in any way the application of laws, rules or regulations having the force and effect of law. The arbitrator's decision shall be submitted in writing within thirty (30) days following close of the hearing or the submission of the briefs by the parties, whichever be later, unless the parties agree to an extension. The decision shall be binding on both the Employer and the Union and shall be based solely on the arbitrator's interpretation or application of the express terms of this agreement and to the facts of the grievance presented. (C) The fees and expenses for the arbitrator's services and proceedings shall be born equally by the Employer and the Union provided that each party shall be responsible for compensating its own representatives and witnesses. If either party desires a verbatim record of the proceedings, it may cause such a record to be made, providing it pays for the record. If both parties desire a verbatim record of the proceedings, the cost shall be shared equally. 6.06 Waiver - If a grievance is not presented within the time limits set forth above, it shall be considered "waived." If a grievance is not appealed to the next step within the specified time limit or any agreed extension thereof, it shall be considered settled on the basis of the Employer's last answer. If the Employer does not answer a grievance or an appeal thereof within the specified time limits, the Union may elect to treat the grievance as denied at that step and immediately appeal the grievance to the next step. The time limit in each step may be extended by mutual agreement of the Employer and the Union. 4 6.07 Choice of Remedy - If, as a result of the written Employer response in Step 3, the grievance remains unresolved, and if the grievance involves the suspension, demotion, or discharge of an employee who has completed the required probationary period, the grievance may be appealed either to Step 4 of Article VI or a procedure such as the following: Civil Service, Veteran's Preference, Fair Employment, or to a hearing before the City Council pursuant to City Ordinance. If appealed to any procedure other than Step 4 of Article VI, the grievance is not subject to mediation or arbitration as provided for in Step 4 and/or Step 5 of Article VI. The aggrieved employee shall indicate in writing which procedure is to be utilized -Steps 4 and 5 of Article VI or another appeal procedure -and shall sign a statement to the effect that the choice of any other remedy precludes the aggrieved employee from making a subsequent appeal through Steps 4 and 5 of Article VI. The written statement requesting mediation shall serve as official notice that .the choice of Step 4 precludes the aggrieved employee from making a subsequent appeal under any other procedure. ARTICLE VII Definitions 7.01 Union -The International Union of Operating Engineers, Local No. 49, AFL-CIO. 7.02 Employer -The City of Monticello, Wright County, Minnesota. 7.03 Union Member - A member of the International Union of Operating Engineers, Local No. 49. 7.04 Employee - A member of the exclusively recognized bargaining unit. 7.05 Base Pav Rate -The employee's hourly pay rate exclusive of longevity or any other special allowances. 7.06 Seniority -Length of continuous service with the employer. 7.07 Compensatory Time -Time off the employee's regularly scheduled work schedule equal in time to overtime worked. 7.08 Severance Pav -Payment made to an employee upon honorable termination of employment. 7.09 Overtime -Work performed at the express authorization of the employer for all hours worked over forty (40) hours in a seven (7) day period. The week starts on Saturday and ends on Friday. 7.10 Call Back -Return of an employee to a specified work site to perform assigned duties at the express authorization of the Employer at a time other than an assigned shift. An extension of or early report to an assigned shift is not a call back. 7.11 Strike -Concerted action in failing to report for duty, the willful absence from one's position, the stoppage of work, slowdown, or abstinence in whole or in part from the full, faithful, and proper performance of the duties of employment for the purposes of inducing, influencing, or coercing a change in the conditions or compensation or the rights, privileges, or obligations of employment. 7.12 Performance Evaluation - An evaluation by a supervisor of the employees' work performance as it relates to meeting requirements and expectations of the position's job description. 5 7.13 On-Call -When an employee is assigned by the Employer to carry a pager and be on call and available to respond to an emergency at a time other than an assigned shift within a 7-day work week. ARTICLE VIII SavinAS Clause 8.01 This agreement is subject to the laws of the United States, the State of Minnesota, and the signed municipality. In the event any provision of this agreement shall be held to be contrary to law by a court of competent jurisdiction from whose final judgment or decree no appeal has been taken within the time provided, such provision shall be voided. All other provisions of this agreement shall continue in full force and effect. The voided provision may be renegotiated at the request of either party. ARTICLE IX Work Schedules 9.01 The sole authority in work schedules is the Employer. The normal work day for an employee shall be eight (8) hours. The normal work week shall be forty (40) hours, Monday through Friday. 9.02 Service to the public may require the establishment of regular shifts or work weeks for some employees on a daily, weekly, seasonal, or annual basis other than the normal 7:30 - 4:00, Monday through Friday, workday. Assignment of regularly scheduled hours different than above will only be made with three (3) days advance notice. At the employer's discretion, the employer may change the normal 7:30 a.m. - 4:00 p.m., Monday through Friday workday to 7:30 a.m. 4:30pm with an hour lunch. 9.03 In the event that work is required because of unusual circumstances such as (but not limited to) fire, flood, snow, sleet, or breakdown of municipal equipment or facilities, no advance notice need be given. It is not required that an employee working other than the normal work day be scheduled to work more than eight (8) hours; however, each employee has an obligation to work overtime or call backs if requested unless unusual circumstances prevent him (her) from so working. 9.04 Service to the public may require the establishment of regular work weeks that schedule work on Saturdays and/or Sundays. ARTICLE X Overtime Pav 10.01 Hours worked outside of regularly scheduled hours and in excess of forty (40) hours within a seven (7) day period will be compensated for at one and one-half (1-1/2) times the employee's regular base pay rate. Employees scheduled to work on Saturday or Sunday will be paid the overtime rate for all hours worked. The employer has the right to send employees who work unscheduled hours on Saturday and Sunday home early on Friday if they have worked 40 hours in the work week. Holiday and sick leave will be counted as hours worked for the purposes of computing overtime. Vacation and comp time will not be counted as hours worked for purposes of calculating overtime. Hours worked on the ten and one-half (1-1/2) holidays set forth in Article XIX will be compensated for at two (2) times the employee's regular base rate. The one-half (1/2) day (12 hour) holiday period on December 24 is considered to have started at 11:30 a.m. on a normal scheduled work day of 7:30 a.m. to 4:30 p.m. or after the employee has 6 completed four (4) hours work if scheduled to begin work at other than normal starting time. 10.02 Overtime will be distributed as equally as practicable. 10.03 Overtime refused by employees will, for record purposes under Article 10.02, be considered as unpaid overtime worked. 10.04 For the purpose of computing overtime compensation, overtime hours worked shall not be pyramided, compounded, or paid twice for the same hours worked. For the purposes of computing overtime on a weekly basis, comp time will not be considered actual time worked for determining eligibility for overtime pay. 10.05 The Employer may allow for compensatory time off in lieu of overtime payment for overtime worked and for call backs. If a mutually satisfactory time cannot be agreed upon, the Employer shall grant compensatory time off as the employee requests provided the employee gives the Employer seven (7) days notice and further provided the time off will not unduly disrupt operations. Employees can only accumulate a balance of eighty (80) hours compensatory-time. Employees will be paid overtime pay for any overtime worked while such accumulated balance is at eighty (80) hours. Employees will not be allowed to use more than 80 hours of comp time per calendar year. 10.06 At the discretion of the supervisor, an employee temporarily assigned to carry out the basic responsibilities of a lead employee or assistant superintendent for a specified period of time shall be required to carry a pager while on duty and off duty and shall be compensated an additional $1.00 per hour actually worked above the base compensation. When a department supervisor has three or more employees assigned to work under his/her direction, the Employer shall have the option of assigning an employee to the status of Operator/Mechanic Lead Person on an annual basis, and that employee shall be compensated an additional $1.00 per hour above base rate compensation. In the absence of the department supervisor, a lead person may be assigned to an on-call status and shall be required to carry a pager while on and off duty during the supervisor's absence. The Employer shall have the sole authority in selection of a lead person to be based on performance evaluations and capabilities of the employee. 10.07 An employee called in for work at a time other than the employee's normal scheduled shift will be compensated for a minimum of two (2) hours' pay for any time actually worked up to two (2) hours or at one and one-half (1-1/2) times the employee's base pay rate for more than two (2) hours of call back time. 10.08 A'water/sewer collection employee assigned to a weekend schedule for on-call status shall be required to carry a pager while on and off duty and be compensated an additional three-and-a- half (3-1/2) hours for atwo-day weekend and five-and-one-quarter (5-1/4) hours for athree-day weekend above base compensation for the weekend period. An on-call status employee shall be available to respond to emergency calls within a 15-minute response time and will carry the only pager available for that department. In addition to the daily compensation, the employee will be compensated for any additional callback time at regular base rates of pay for the number of hours worked. At the discretion of the Employer, a department supervisor may be assigned to a rotation as an on-call status and shall be available to respond to all emergency calls for service during that rotation. All weekend assignments for on-call status shall be determined and scheduled at the discretion of the Employer. For the purpose of this section, a weekend period begins at the end of the normal shift of the individual assigned on Friday and ends at the beginning of a normal shift on Monday. In the case of a three-day weekend, the period begins at 7 the end of the normal shift prior to the beginning of a three-day weekend and ends at the beginning of the next regular day shift after the three-day weekend. :This section regarding additional compensation for on-call status does not apply to an individual ;assigned to on-call status under 10.06. ARTICLE XI Le4al Defense 11.01 Employees involved in litigation because of negligence, ignorance of laws, non-observance of 'laws, or as a result of employee judgmental decision may not receive legal defense by the :municipality. 11.02 Any employee who is charged with a traffic violation, ordinance violation, or criminal offense ''arising from acts performed within the scope of this employment, when such act is performed in '.good faith and under direct order of his/her supervisor, shall be reimbursed for reasonable :attorney's fees and court costs actually incurred by such employee in defending against such ,charge. ARTICLE XII Right of Subcontract 12.01 Nothing in this agreement shall prohibit or restrict the right of the Employer for subcontracting work performed by employees covered by this agreement. ARTICLE XIII Discipline 13.01 The Employer will discipline employees only for what it considers to be just cause. ARTICLE XIV Seniori 14.01 seniority shall be the determining criterion for transfers, promotions to other bargaining unit :positions, and layoffs only when all other qualification factors are equal. ARTICLE XV Probationary Periods 15.01 All newly hired or rehired employees will serve a six (6) month probationary period. Time worked `pursuant to any governmental program shall not count toward the probationary time required. ARTICLE XVI Safe 16.01 The Employer and the Union agree to jointly promote safe and healthful working conditions, to cooperate in safety matters, and to encourage employees to work in a safe manner. 16.02 Where items of safety equipment are required by federal, state, or local rules and regulations, it shall be a condition of employment that such equipment will be worn or utilized by the employee. Employees may provide personal items only if approved by the Employer in advance. 8 ARTICLE XVII lob Posting 17.01 The Employer and the Union agree that permanent job vacancies within the designated bargaining unit shall be filled based on the concept of promotion from within provided that applicants: (a) Have the necessary qualifications to meet the standards of the job vacancy; and (b) Have the ability to perform the duties and responsibilities of the job vacancy. 17.02 Employees filling a higher job class based on the provisions of this article shall be subject to the conditions of Article XV (probationary periods). 17.03 The employer has the right of final decision in the selection of employees to fill posted jobs based on qualifications, abilities and experience. 17.04 Job vacancies within the designated bargaining unit will be posted for five (5) working days so that members of the bargaining unit can be considered for such vacancies. ARTICLE XVIII Group Insurance Program 18.01 The City of Monticello agrees to contribute the following amount of money on a monthly basis towards the cost of the HealthPartners Medical and Dental Insurance Program set forth in Appendix #2. All employee classes covered by this agreement will pay the difference between full cost and the contribution amount set forth below: EE Only Add'I Family 1/1/09 Total Prem. Max Base Contrib. Todd Barnes $ 413.62 $ 645.25 $ 1,058.87 $ 929.83 'Jim Ei se I e $ 413.62 $ 645.25 $ 1, 058.87 $ 929.83 Mike Haaland $ 413.62 $ 645.25 $ 1,058.87 $ 929.83 Roger Hoglund $ 413.62 $ 645.25 $ 1,058.87 $ 929.83 Mike Rogers $ 413.62 $ 645.25 $ .1,058.87 $ 929.83 AI Gap;inski $ 413.62 $ 645.25 $ 1,058.87 $ _ _ 929.83 `Josh Berthiaume $ 413.62 $ 645.25 $ 413.62 ` $ 929.83 Tom Grossnickle $ 413.62 $ 645.25 $ 1,058.87 $ 929.83 Derek Wipper $ 413.62 $ 645.25 $ 413.62 $ 929.83 Leo Schroden $ 413.62 $ 645.25 $ 1,058.87 $ 929.83 Dan Jones $ 413.62 $ 645.25 $ 1,058.87 $ 929.83 Jerod Ruotsalainen $ 413.62 : $ 645.25 ' $ 1,058.87 $ 929.83 Sean Weis $ 413.62 $ 645.25 ' $ 1,058.87 $ 929.83 $ 5, 377.06 $ 8, 388.25 $ 12, 474.81 $ 12, 087.79 9 2009 Employee Family Share: Dental $12.26 Medical $129.04 Effective January 1, 2010 and January 1, 2011, the City of Monticello agrees to adjust the Employer monthly contribution amounts listed above by an amount equal to any contribution provided to non-union employees. The City retains the right to change insurance carriers and/or program benefit levels provided any changes are consistent with all City of Monticello employee groups. ARTICLE XIX Holidays 19.01 The Employer will provide the following ten and one-half (10-1/2) paid holidays for the length of this Agreement for all Equipment Mechanic/Operator, Shop Mechanic/Operators and Forman employees: New Year's Day, Martin Luther King Day, President's Day, Memorial Day (last Monday in May), Independence Day, Labor Day (first Monday in September), Columbus Day (second Monday in October), Veteran's Day (November 11), Thanksgiving Day, Christmas Day, and one-half (1/2) day on December 24 to be observed on the last work day preceding Christmas. When New Year's Day, Independence Day, Veterans Day, or Christmas Day falls on Sunday, the following day shall be a holiday. When New Year's Day, Independence Day, Veterans Day, or Christmas Day falls on a Saturday, the preceding day shall be a holiday. ARTICLE XX Vacation Leave 20.01 All permanent Equipment Mechanic/Operator, Shop Mechanic/Operators and Forman employees scheduled to work 40 hours per week covered by this agreement shall earn vacation benefits as fiol lows: ~ After 1 year o~F service ' 40 hrs~ straight time L 2-5 ycar~ of scn~ice 130 hr ~~ straight time 5-15 years of service 120 hers straight time ~ c ...,.......,..,,.,..... I ~yca~~ ~~ ~~w~~ , e c n u...~ ,,ate..:... i.,a ~.. ~~~ ~~~~ ~~~a~~~~~ ~.ime 20.02 Except as specifically approved in writing by the City Administrator, employees will not be allowed to accumulate in excess of 2.0 times the employee's annual vacation accrual. Any employee who has accumulated as of April 1, 2001, vacation hours in excess of 2.0 their annual earnings shall be allowed to continue to accrue the excess hours they have accumulated as of April 1, 2001, provided the amount does not exceed 240 hours. 20.03 Any permanent employee leaving any municipal service in good standing after giving proper 10 notice of such termination of employment shall be compensated for vacation leave accrued and unused to the date of separation. 20.04 No employee shall be permitted to waive vacation leave for the purpose of receiving double pay. ARTICLE XXI Sick Leave 21.01 Eli ibili :Sick leave with pay shall be granted to all probationary and permanent employees classified as Equipment Mechanic/ Operators at the rate of one working day for each calendar month of full-time service. For this purpose, one calendar month shall be any month in which an employee is paid for twelve (12) or more working days, provided that such sick leave granted probationary employees shall not be available for use until satisfactory completion of the initial (not promotional) probationary period. 21.02 Accrual: Sick leave may be accumulated as earned with no maximum accumulation limit after April 1, ' 1996. 21.03 Sick leave may be granted only for absence from duty because of personal illness or legal quarantine of the employee, his/her spouse, or children. 21.04 In the event of death or serious illness in the immediate family, a maximum of three (3) days sick leave shall be allowed. 21.05 Workman's compensation benefits and/orCity-provided weekly disability benefits shall be credited against the compensation due an employee using sick leave benefits. 21.06 Proof Required: In order to be eligible for sick leave with pay, an employee must: 1. Report within one-half (1/2) hour, unless circumstances do not permit in which case as soon as circumstances do permit, of the beginning of his/her work day to his/her department head the reason for his/her absence. 2. Keep his/her department head informed of his/her condition if the absence is of more than three (3) days duration. 3. Submit a medical certificate for any absence if required by the department head or City Administrator. 21.07 Penal :Claiming sick leave when physically fit, except as permitted in this section, may be cause of disciplinary action, including transfer, suspension, demotion, or dismissal. 21.08 Immediate Familv: Immediate family for purposes of serious illness shall mean mother, father, husband, wife, son and daughter. Immediate family for purposes of death shall, in addition to the foregoing, include brother, sister, grandparent, mother-in-law, and father-in-law. 21.09 Fit to resume duty; alternate duty After an illness or injury has caused an absence, the Employer may require the employee to submit a medical certificate indicating the employee's fitness to resume duty. The City may request the employee to submit to an examination by a physician which the City designates, said examination to be at the expense of the City. While the Employer will consider the recuperation of the employee when assigning tasks, nothing herein shall be construed to obligate the Employer to assign, provide, or create special duty for the employee. If, 11 however, the Employer can provide special duty in a particular instance, said assignment of special duty shall not constitute a policy or precedent for extending the special duty or for providing special duty in a different instance. The Employer reserves the full and unrestricted right to place on unpaid, inactive status any employee who is unable to fully perform the duties and tasks assigned. Any employee placed on inactive status for more than six months may be discharged by the Employer for medical reasons, except that the Employer may extend such absence in the event the Employer's doctor provides a certified statement that the employee will be able to resume his/her duties on a specified date. Any employee on inactive status for more than 12 months may be discharged by the Employer and termination will be considered for medical reasons, and the employee shall be considered to have left employment in good standing ARTICLE XXII Severance Pav 22.01 Eligible employees leaving City service after five (5) years of employment with the City shall receive payment for unused sick leave at the time their final paycheck is issued based on 1/ 4 of the employee's unused sick leave times the hourly rate at the time of giving notice and such payment shall be sent to the MSRS Health Care Savings Plan in the employees name, such funds to be used for allowable medical costs in accordance with MSRS regulations. 22.02 Eligible employees leaving City service after ten (10) years of employment with the City shall receive payment for unused sick leave at the time their final paycheck is issued based on 1/2 of the employee's unused sick leave times the hourly rate at the time of giving notice, not to exceed ffty (50) days, and such payment shall be sent to the MSRS Health Care Savings Plan in the employees name, such funds to be used for allowable medical costs in accordance with MSRS regulations. 22.03 Eligible employees leaving City service who have accumulated above 100 sick days after April 1, 1996, will be allowed to receive credit for any days over 100 at the current hourly rate of pay as a severance benefit. An employee who is eligible to receive accumulated sick days severance benefits after termination is required to participate in the Minnesota State Retirement System Health Care Savings Plan and allowable funds will be transferred by the Employer to MSRS in the employee's name. 22.04 Eligible employees who have accumulated above 100 sick days after April 1, 2003, will be required to contribute up to 100 hours annually to the MSRS Health Care Savings Plan until the employee's accumulated sick days have been reduced to 800 hours (100 days). Upon termination of employment, any remaining severance benefits would be paid to the employee's MSRS account. 22.05 Only days of sick leave accumulated after April 1, 1980, will be considered for any type of severance benefit. Any permanent employee leaving any municipal service in good standing after giving proper notice of such termination of employment shall be eligible for severance pay provisions outlined. 22.06 If an employee dies before being able to utilize all of the severance funds, his/her spouse, beneficiaries, or estate shall be entitled to receive the balance of any funds remaining in accordance with MSRS Health Care plan provisions. The employer shall calculate the amount of eligible severance benefits available that have not been transferred to the MSRS Health Care Plan and shall remit these funds to the MSRS Plan in the employees name. An employee who has previously enrolled in the MSRS Health Care Savings Plan will have any remaining 12 severance benefits paid to their MSRS account. 13 ARTICLE XXIII Waiver 23.01 Any and all prior agreements, resolutions, practices, policies, rules, and regulations regarding terms and conditions of employment to the extent inconsistent with the provisions of this agreement are hereby superseded. 23.02 The parties mutually acknowledge that during the negotiations which resulted in this agreement, each had the unlimited right and opportunity to make demands and proposals with respect to any term or condition of employment not removed by law from bargaining. All agreements and understandings arrived at by the parties are set forth in writing in this agreement for the stipulated duration of this agreement. The Employer and the Union each voluntarily and unqualifiedly waives the right to meet and negotiate regarding any and all terms and conditions of employment referred to or covered by in this agreement or with respect to any term or condition of employment not specifically referred to or covered by this agreement, even though such terms or conditions may not have been within the knowledge or contemplation of either or both parties at the time this contract was negotiated and executed. ARTICLE XXIV Education Compensation 24.01 Employees will be reimbursed for one hundred percent (100%) of the cost incurred for the payment of tuition, fees, and text books required in the attendance of job-related courses provided that: • The course has been approved by the City Manager and department director prior to registration for, or participation in, the course. • The employee has submitted a certified fee statement for payment of tuition, fees, and purchase of text books. • The employee must show proof of satisfactory completion of the course. • The attendance of the employee at course sessions has been satisfactory. ARTICLE XXV Clothing/ Uniform Allowance 25.01 The Employer agrees to contribute up to $502.36 annually to each full-time permanent Union employee for uniform/ clothing laundering services that may be used by employees. Effective April 1, 2002, the City of Monticello agrees to contribute $502.36 annually plus up to fifty percent (50%) of any increase incurred by the City for the uniform/ clothing laundering services. 14 ARTICLE XXVI Duration This AGREEMENT shall be effective as of April 1, 2009, and shall remain in full force and effect until March 31, 2011. INTERNATIONAL UNION OF OPERATING CITY OF MONTICELLO ENGINEERS, LOCAL NO. 49 Mayor Glen D. Johnson, Business Manger City Administrator Dated this day of 2009. Kent A. Korman, Area Business Rep. Steward Steward Dated this day of 2009. 15 APPENDIX #1 SALARY SCHEDULE FOR 2009-2010 The City of Monticello agrees to pay all bargaining unit employees under this contract according to the following salary schedules beginning with the June 11, 2009 payroll. The salary schedule for Equipment Mechanic/Operator will be as set forth below and shall represent the hourly base salary, exclusive of all supplemental pay, for employees under this contract for the duration of the contract. New employees hired after this date start on step one for the first (6) Six months worked, and the employee will be eligible for increases based on the length of service and the schedule listed below. Individual employees eligible for specific salary adjustments based on the schedule listed below, either horizontally or vertically, depending on their length of service or specific contract dates noted, are contingent upon the employees receiving a satisfactory performance evaluation by their supervisor. Salary Schedules: Equipment Operators/Mechanics (Grade 9)- 4/1/09 Months Rates 78 to 90 $ 23.79 66 to 78 $ 23.00 54 to 66 $ 22.22 42 to 54 $ 21.43 30 to 32 $ 20.65 18 to 30 $ 19.87 6 to 18 $ 19.08 O to 6 $ 18.30. *4/1/2010 wages will be whatever the non-union salary schedule adjusted for the year. The salary schedule for Shop Mechanic/Operator and Foreman positions will be as set forth below and shall represent the hourly base salary, exclusive of all supplemental pay, for employees under this contract for the duration of the contract. New employees hired after this date start on step one for the first (6) six months worked, and the employee will be eligible for Increases based on the length of service and the schedule listed below. Individual employees eligible for specific salary adjustments based on the schedule listed below, either horizontally or vertically, depending on their length of service or specific contract dates noted, are contingent upon the employees receiving a satisfactory performance evaluation by their supervisor. Salary Schedules: Equipment Operator/Mechanic (Grade 10)- 4/1/09 Foreman (Grade 10)- 4/1/09 16 :Months Rates 78 to 90 $ 25.36 '66 to 78 $ 24.52 54 to 66 $ 23.68 42 to 54 $ 22.85 30 to 32 $ 22.01 18 to 30 $ 21.18 .. 6 to 18 $ 20.34 0 to 6 $ 19.50 ** 4/1/2010 wages will be whatever the non-union salary is adjusted for the year. 17 APPENDIX #2 GROUP LIFE AND MEDICAL INSURANCE BENEFIT SCHEUDLE See attached sheet 18 -1'i- HealthPartners Open A~t~ess Choice City of Monticello :.n% HealthPartners The following is an overview of your HealthPartners coverage. For exact coverage terms and conditions, consult your plan materials, or call Member Services at (952) 883-5000 or I-800-883-2177. ~! t e an . ~ u, ~o - _-qc~ het • ~ -._ -. _ , . Lifetime maximum Calendar ear deductible Unlimited $1,000,000 Calendar ear medical out-of- ock t i $200 er erson; $600 er famil $300 er erson; $900 er fanul e max mum $1,000 er erson; $2 000 er fanvly $2 000 Preve~t3re 1,Ieallh Care ; , , ; 1-.-. , er erson; $4,000 er famil • Routine physical & e e exami i y nat ons, well- 100% coverage No covera e child care g ^ Prenatal & ostnatal care 100% covera e 60% • Immunizations coverage after deductible Office Visits I00% coverage No covera e g • Illness or in ur • Aller i • i $10 co a ment 60%covera e after deductible n ect ons 100% covera e 60% • Ph sical, occu ational & s eech thera y $10 co a ment covera e after deductible • Chiropractic care $10 copayment 60% covera e after deductible (neuromusculo-skeletal conditions on] ) 60% coverage after deductible ^ Mental health care $10 co a ment 60% • Chemical health care covera e after deductible Emer eric` Care $10 co ayment . , ~., , ... 60% coverage after deductible • Urgently needed care at an urgent caze Clinic , ~: $10 copayment 80% coverage or medical center Emergency care at a hos rtal ER • P $75 copayment after in-network deductible 80% coverage ^ Ambulance after in-network deductible I ti n ' t 8 0% covera a after deductible HealthPartners in-network benefit n ,a e t ~os i 1 Care ~ - ~ '. . • Il • ~ ., , ~ lness or in ur • Mental health care 80% covera e after deductible 60% covera e after deductible • Chemical health care 80% covera a after deductible 60%covera e after deductible Otit atienf dare 80% covera e after deductible ~ ~ 60% covera e after deductible ~ Scheduled out anent roced ~ ures • Outpatient Magnetic Resonance Ima in 80%covera e after deductible 100% 60% covera *e after deductible g g (MRI) and Com utin Torno ra by (CT) coverage after deductible 60% coverage after deductible ~urOble~`edtcal".i:.~ tii"`ril~.~t"=• ~~ ~ ~ ~ ,:: ' • Durable medical equipment & prosthetic devices 30% coverage after deductible ~ 60%•coverage after deductible rescrtptton Rrugs, ~. ~ i . ~';, HealthPartners aril i atfn °~ ~' ~ P 9' ~ Non Par~i.Clpating ', (31 •day supply; / cycle °fora! conrraceptivea 90-day supply , PllartillC BBnefll Y Pha ~ acy 13ene1'it pr rngil order) , , ~ ~'J17 ,: ~ ., J ,_ ..:: ~. . ^ Retail Phartrutcv Co avment For I-month su Iv • Generic Preferred $5 co a •ment 6(}% a>veriVe after deductible • Brand Preferred $ ] ~ co ~a ment 6(1%covera e after deductible • NonPrefen•ed $40 co a ~ment 6U'7o coverage after deductible ^ HealthPartnet•s Mail Order Pharmacy Co payment for 3-month su ~ I ^ Generic Preferred $10 co a ment • Brand Preferred $30 copayment • Non!'refen~ed $8U aroavment City of Monticello Full-Time Employee Benefits Vacation Accrues from start: eligible to use what has accrued after 6 months 2 weeks for 0-5 years 3 weeks for 6-10 years 1 additional day per year after that up to 22 day maximum ** Union Schedule varies slightly Sick Leave Accrues 1 day per month; can use what has accrued ** Union schedule varies slightly Holiday 10 %2 days per year Insurance Medical- HealthPartners- Effective- 1St of the month following 30 days Single- $ 0 per month Family-$ 129.04 per month Dental- HealthPartners- Effective- 1St of the month following 30 days Single- $ 0 per month Family-$12.26 per month Life Insurance- City pays for the following life insurance: Employee basic life insurance-$25,000 Spouse Life Insurance-$5,000 Dependent Life Insurance-$2,000 Long-Term Disability- City pay for Long-Term Disability; 90 day elimination Other Supplemental Coverage you can purchase include: Additional Life (Standard Insurance) Short-Term Disability(Colonial) Vision (VSP) Accident and Critical Illness (Colonial) Flex Spending Accounts Allows employees to designate pre-tax dollars for: Health-related costs ($2500 Max) Childcare costs ($5000 Max) Deferred Compensation 457 deferred compensation plans (optional) Employee deductions only (no employer match) Currently includes Ameritas & ICMA PERA (Public Employees Retirement Association) Mandatory employee deduction Mandatory employer contribution MONTICELLO Proposed Contract Changes Between City of Monticello And International Union of Operating Engineers, Local No. 49 AFL-CIO Contract Date: April 1, 2009-March 31, 2011 1. Keep comp time cap at 80 hours but unable to use more than 80 hours per calendar year. Comp time use is not guaranteed; needs to be pre-approved by supervisor. *Choosing the use comp time instead of vacation could result in a loss of vacation (See city policy regarding vacation carry over). 2. Pay for 2009 and 2010 will be adjusted by whatever rate non-union employee pay is adjusted; Adjustments will occur on contract renewal dates. 3. Pay at 1 %: times regular rate for hours worked on Saturday and Sunday (only if over 40 hours in workweek). Pay hours worked on all City holidays at 2 times regular rate regardless of how many hours are worked. The City's workweek is Saturday-Friday. The City does reserve the right to manage OT worked for employees who are not regularly scheduled on Saturday and/or Sundays by sending employees home early on Friday if they have 40 hours in the workweek. 4. Holidays and sick time will count towards hours worked when calculating OT. Vacation and comp time will not count towards hours worked when calculation OT. 5. Update vacation schedule to reflect vacation schedule that was in 2005-2007 contract. j"-Z~-~~ City Representative's Signature Date Monticello City Hall, 505 Walnut Street, Suite 1, Monticello, MN 55362-8831 (763) 295-2711 Fax (763} 295-4404 Office of Public Works, 909 Golf Course Road, Monticello, MN 55362 (763) 295-3170 • Fax (763) 271-3272 Department of Motor Vehicles, 119 3rd Street East, Monticello, MN 55362 (763) 295-2712 Fax (763) 271-3239 City Council Agenda - 06/08/09 SC. Consideration of a request to extend an existing Interim Use Permit for the Alternative Learning Program (ALP). Applicant: Monticello Independent School District ~~ A. REFERENCE AND BACKGROUND The Planning Commission reviewed this item during their regular meeting on June 2°d, 2009. The Planning Commission inquired if there had been any concerns registered with the City as related to the ALP and its location. Staff have received and reported to complaints regarding the facility. The IEDC also had no formal comment as related to this extension request. The Commission also inquired as to the reasoning behind the off-site location as opposed to a current school facility such as Eastview Elementary. Superintendent Johnson explained that the ALP program has been successful in part because the program is off-site. Students in the Turning Point program have shown to progress outside of a traditional school building. Johnson also explained that Eastview Elementary is currently at approximately 90% capacity in terms of use. The building is used for Head Start, ECFE and other district educational and community programs. Hearing no other public comments or concerns, the Planning Commission unanimously approved the request. The Alternative Learning Program of the Monticello School District is seeking approval for an extension of their Interim Use Permit to operate in an I-1, Light Industrial, location. The original permit was considered for the 1997-1998 school year, and was approved concurrent with an ordinance amendment imposing conditions including the following: 1. A short-term termination date is established to ensure that the City's industrial development objectives were not affected by the location of the school facility in industrial areas. 2. The building was remodeled only to the extent that convenient re-use by office or industrial users would still be possible. 3. The parking was judged to be adequate for the school use of the property. In relationship to these conditions, the City has extended this interim use permit four times since the original application, each for three year increments. At the time of the most recent, the discussion by both the Planning Commission and City Council related to the potential for an alternative location or a more permanent approval. However, it was determined that the temporary use was appropriate given the minimal impact on surrounding industrial properties and the lack of immediate need for industrial space at that location. It is has also been the general direction that the base property use continue to be industrial, rather than rezoning, in order to preserve the possibility for future business development. Additionally, staff would suggest that as the City will be undertaking a complete analysis of the zoning code in the near future, the goals for industrial districts, along with their City Council Agenda - 06/08/09 permitted, conditional and interim uses will be reviewed. At that time, a discussion about uses such as the ALP can be placed in a more comprehensive context. As such, it would appear that the continuation of the IUP is appropriate at this time. The planning report for the original item has been provided for reference. B. ALTERNATIVE ACTIONS The Planning Commission recommends alternative 1 below. 1. Motion to approve the Interim Use Permit for the Alternative Learning Program for a three year period, based on a finding that the use continues to raise no issues with the surrounding users, and continues to comply with the conditions above. 2. Motion to deny the Interim Use Permit, based on a finding that the site should revert to an industrial use consistent with the current zoning. 3. Motion of other. C. STAFF RECOMMENDATION Staff recommends approval of the IUP. Although the interim use permit has exceeded what may be considered typical for interim uses, the use itself has shown to be unobtrusive to the surrounding industrial sites, and there is currently no pressure to utilize the site for other industrial purposes. Additionally, it may be that a review of the industrial district's purpose statements and allowed uses as part of the zoning ordinance revision may provide for a more suitable permanent option. As such, the interim permit may be the best alternative at this time. D. SUPPORTING DATA Exhibit A: Site Location Map Exhibit B: Staff Report of 09/02/97 Exhibit C: Planning Commission and City Council Minutes for 1997 Request Exhibit D: I-1-Light Industrial District Standards Exhibit E: 2008 Official Zoning Map 2 c ~ ~ ~ ~ ~ ~~ " C Um ~ N °i ti rn c ~ N ~ ~ O J ~ (~ ! --~ ~ ~ 61~ '7~ 70.E ~ ~ ....~ _ . AUCr28-1997 09 20 t~C `' NORTHWEST ASSOCIATED CONSULTANTS COMMUNITY PLANNING DESIGN MAIgKLr7 RESEARCH INC PLANNING REPORT T~: ,Monticello Mayor and City issuon II Monticello Piannmg Comm FROM: Stephen Grittman Fj`~,C~'°`' DATE: August 27,1997 Monticello -Monticello School District - AltemaYNe Learning Center RE: FILE N0: 191.07 - 97. n t-1 - a ~ 5775 WAYZATA BOULEVARD, SUITE 555 A ~ccuf~NrF~ p ~ d~ ~~._~~~ nested approval of their request to allow public The Monticello School District has req schools as interim uses in the I-1 District, and the issuan ~ rosuo es to occupy existing building at 1248 Oakwood Drive E. The school d~stn p p 800 s uare foot, two story industrial building .between the H-Window building and 4' q osed use wait be an alternative school program for students Simonson Lumber. The prop ident~ed by the district for more individualized treatmen ~ ~~ ~ ~~~antl ~s de~x~pec~ted to the program will begin the school year with approximately expand to 50 or more students as the year goes on. There are two primary issues for the City to consider with this request. First is the amendment of the Zoning Ordinance to allow the s ernnit ~ wince lo~p~ ~ for~this Second is the district's application for an Intenm use p school year. This request is being pursued as an interim use. se ne~udeftm z'inguomf btreaffic, P°~b e related to school uses in industrial districts. The ST. LOUIS PARK, MINNESOTA g@5416 PHONE 61 2-595-9638 FAX 61 Z•3Si5-9837 E-MAIL NACC9twl~~~~`"~"'"~ 612 595 ~3' ~ r . ~.,,• v • RUG-2B-199' 09 ~ 20 H~ ~, pedestrian traffic generated by the school use, and parking supply for classroom use in a building designed for industrial use. Finallmin a ~~rtion of the ava table supply for non- over the supply of industrial land. Consu g Po industrial use raises this issue as well. With regard to the land supply issue, the interim uwls'1 p~~thePsame time eSestherv nA ong ability to accommodate the school distracts needs, term industrial use for the site. The proposed amendment includes a clause requiring that the building not be altered in such a way that woauld m rt~tions~ o ~ other dsuch modu e difficult. For instance, the use ~ a~ ~~ s g ~n i~Cant permanent remodeling. improvements, would be more approp With regard to traffic, the proposed site is located on County ~ ~e most d"tfificult issue moving of traffic should not be s signrfrra~t concem• Parking may for the current site. The district should be required to stripe the parking lot to assure the most efficient use of the available space. The d'istrit~ has indicated that some students wilt drive to the site, while others will use school transno~ ti ~~ the addition of parpki A'~t needs, the City could consider a parking option orate lot may be appropriate if the area as demand is shown. A gravel surfaced temp rY parking demand eventually exceeds the supply. One special requirement of interim uses is the documn~ in a m~ ustas aretrenewable we has not proposed a termination date at this time. S ear. If remodeling would recommend a short tune period, perhaps even one y improvements are minimal, the district should not have over-invested in this site. Moreover, if Improv®ments are too extensive, the issue of reverting to industrial use becomes more of a concern for the City. Finally, the district has ind~ated their need to ocxurp {~ uvithlthe Bu (ding Offtciat to asslure projects are still in progress. This could be word adequate I'de safety requirements are met during the project. R Decision 1. Amendment to the Zoning Ordinance establishing School uses as interim uses in the 1-1 Zoning District. AISl1, Approve the proposed amendment as submitted. I Deny the proposed amendment as submitted. '0 2. Issuance of an Interim Use Permit to the Monticello School District to operate Decis~ n an alternative school program at 12'48 Oakwood Drive E. AUG-28-1997 09 21 hIAC 612 595 9837 P.04i0'~ Alta ~,~jye 1. Approve the interim use permit, with the conditions as listed on the attached F~chibit B. This alternative should be accompanied by a finding that the proposed use wiU not interfere with the City's long range objectives of encouraging industrial development in tho area, due to the temporary nature of the permit, and the minimal alterations to the property. ARernativQ2 Deny the ~terim use permit. This alternative should be accompanied by a finding that the use would interfere with the City's long rang® industrial devetopm®nt goals. Staff believes that the alternative schoo! use should be aoceptabie on a short term basis. Due to the City's interest in industrial development, however, long term school use, or changes to the property which could tend to deter future industrial nsuse, would not be compatible with the City's Comprehensive Plan. Therefor, staff would recommend approval only upon conditions which ~tdude a short range termination date, a limitation on remodeling improvements to the building (with an emphasis on temporary or modular improvementsa, and parking supply which is increased to meet demand as use dilates. D UPPORTI(~DATA_ Exhibit A, Slte Plan Exhibit B, Proposed Conditions to Irterim Use Permit q7-~iq Planning Commission Minutes - 9/2/97 7. Public Hearing---Consideration of sn amendment to,,,#, o i g or ina_nG~ pet ~ ~ g ~, hlie p!1_±~~atinn, ucPC ac an int,Q~jm ,ap in .h T-1 7.one. A li n . 8. Public Hea-ring--Co sideration of an a~~ndment to the zoning orcLina_nce ab is ing public education ia~ses as a_n_ interim use in the T-? zone. Aye is n .. Monticello Public ~~:hool. 9. Publir Heari --Consi3eration of an ant~lication for a_n_ interim use permit lla_ ow~n~ a n ~b i . ~A in an T-1 zone. A~jj~an ' 1_Nlonticello Public School. Steve Grittman, City Planner, reported the Monticello School District has requested approval of their request to allow public schools as interim use in the I-1 District, and the issuance of such a permit for an existing building at 1248 Oakwood Drive East. The school district proposes to occupy an existing 4,800 square foot, two story industrial building between the H-Window building and Simonson Lumber. The proposed use will be an alternative school program for students identified by the district for more individualized treatment. The district has indicated that the program will begin the school year with approximately 30-50 students, and is expected to expand to 50 or more students as the year goes on. There are two primary issues for the city to consider with this request. First is the amendment of the Zoning Ordinance to allow the school use in the industrial district. Second is the district's application for an interim use permit allowing occupancy for this school year. Proposed Conditions to interim use permit. 1. The interim use permit will terminate on August 31, 1998. Extension of the use of the subject property for public school purposes beyond the termination date may only be granted through reapplication to the City. 2. The District agrees to stripe the existing parking lot in a way which maximized the paved area for efficient parking supply and circulation. 3. The District agrees to expand parking area at the direction of the City. The City will direct expanded parking based on the City's observation of parking demand which causes the use of on-street parking at any time. 4. The use of the subject property will be for alternative classroom use during normal school hours only, and not for any other use. 5. The District may occupy the building during remodeling only at the direction and under conditions identified by the building official. Page 5 Planning Commission Minutes - 9/2/97 6. The district shall make every effort to avoid permanent changes to the building which, in the opinion of the Building Official, would not be characteristic of an industrial use. Chairman Frie opened the public hearing. Shelly Johnson, consultant far the Monticello High School, explained this program was started while he was the superintendent and stated there will be room in the new high school in approximately two years. The Assistant Principal, Pam Ringstad, has made extensive efforts to find available space to continue this program. Many communities have facilities that are converted for this use. The Commissions inquired as to the ages of the students attending this school because of the traffic on Oakwood Drive, if school buses would be trying to enter the parking lot, and if major changes were being made to the building. Mr. Johnson stated the students are high school age and because of this many will be driving. If school transportation is used it will be a van not a bus. The school is only leasing the space for the alternative learning program not purchasing the building. The remodeling will not prohibit this building from being an industrial office in the future; the structure will not be changed. RICHARD CARLSON MADE A MOTION TO APPROVE, SECONDED BY ROD DRAGSTEN, AN AMENDMENT TO THE ZONING ORDINANCE ESTABLISHING INTERIM USES IN THE I-1 ZONE. MOTION BASED ON THE FINDING IDENTIFIED IN THE PLANNER'S REPORT. Motion passed unanimously. DICK MARTIE MADE A MOTION TO APPROVE, SECONDED BY RICHARD CARLSON, AN AMENDMENT TO THE ZONING ORDINANCE ESTABLISHING SCHOOL USES AS INTERIM USES IN THE I-1 ZONING DISTRICT. MOTION BASED ONT HE FINDING IDENTIFIED IN THE PLANNER'S REPORT Motion passed unanimously. RICHARD CARLSON MADE A MOTION TO APPROVE, SECONDED BY ROD DRAGSTEN, THE ISSUANCE OF AN INTERIM USE PERMIT TO THE MONTICELLO SCHOOL DISTRICT TO OPERATE AN ALTERNATIVE SCHOOL PROGRAM AT 1248 OAKWOOD DRNE E. SUBJECT TO THE FINDINGS THAT THE PROPOSED USE WILL NOT INTERFERE WITH THE CITY'S LONG RANGE OBJECTNES OF ENCOURAGING INDUSTRIAL DEVELOPMENT IN THIS AREA, DUE TO THE TEMPORARY NATURE OF THE PERMIT, AND THE MINIMAL ALTERATIONS TO THE PROPERTY. THE FOLLOWING CONDITIONS APPLY: Page 6 Planning Commission Minutes - 9/2/97 1. THE INTERIM USE PERMIT WILL TERMINATE ON AUGUST 31, 1998. EXTENSION OF THE USE OF THE SUBJECT PROPERTY FOR PUBLIC SCHOOL PURPOSES BEYOND THE TERMINATION DATE MAY ONLY BE GRANTED THROUGH REAPPLICATION TO THE cITY. 2. THE DISTRICT AGREES TO STRIPE THE EXISTING PARKING. LOT IN A WAY WHICH MAXIMIZED THE PAVED AREA FOR EFFICIENT PARKING SUPPLY AND CIRCULATION. 3. THE DISTRICT AGREES TO EXPAND THE PARKING AREA AT THE DIRECTION OF THE CITY. THE CITY WILL DIRECT EXPANDED PARKING BASED ON THE CITY'S OBSERVATION OF PARKING DEMAND WHICH CAUSES THE USE OF ON-STREET PARKING AT ANY TIME. 4. THE USE OF THE SUBJECT PROPERTY WILL BE FOR ALTERNATIVE CLASSROOM USE DURING NORMAL SCHOOL HOURS ONLY, AND NOT FOR ANY OTHER USE. 5. THE DISTRICT MAY OCCUPY THE BUILDING DURING REMODELING ONLY AT THE DIRECTION, AND UNDER CONDITIONS IDENTIFIED BY THE BUILDING OFFICIAL. 6. THE DISTRICT SHALL MAKE EVERY EFFORT TO AVOID PERMANENT CHANGES TO THE BUILDING WHICH, IN THE OPINION OF THE BUILDING OFFICIAL, WOULD NOT BE CHARACTERISTIC OF AN INDUSTRIAL USE. MOTION BASED ON THE FINDING IDENTIFIED IN THE PLANNER'S REPORT. Motion passed unanimously. Page 7 q7-o19 Council Minutes - 9/8/97 5. .~ s n agenda. A. Consideration {,~a`n amendment to the .oz _n_ing orrLna_nce establishing ~uhlic schools as ~n interim »se in the I.1 zones ~ ; ants Monticello Public Schools. Recommendation: Approve the zoning ordinance amendment establishing school uses as an interim use in the I-1 zone. SEE ORDINANCE AMENDMENT N0.295. A MOTION WAS MADE BY CLINT HERBST AND SECONDED BY ROGER CARLSON TO APPROVE THE CONSENT AGENDA AS RECOMMENDED. Motion carried unanimously. ~~-0-9 Council Minutes - 9/8/97 5. Consent agenda. B. Consideration of an applis~lon for an interim use erm;t ~u~vm~g a public use in ~ I-1 zone. Apnl; . n ,Mon ,i~Qllo Public Schools. Recommendation: Approve issuance of an interim use permit to the Monticello School District to operate an alternative school program at 1248 Oakwood Drive East with the following conditions: 1. Interim Use Permit will terminate on August 31, 1998. Extension of the use of the subject property for public school purposes beyond the termination date may only be granted through reapplication to the City. 2. The District agrees to stripe the existing parking lot in a way which maximizes the paved area far efI`icient parking supply and circulation. 3. The District agrees to expand parking area at the direction of the City. The City will direct expanded parking based on the City's observation of parking demand which causes the use of on-street parking at any time. 4. The use of the subject property will be for alternative classroom use during normal school and evening hours but no later than 10 p.m. The property will not be used for any other use.' 5. The District may occupy the building during remodeling only at the direction and under conditions identified by the Building Official. 6. The District shall make every effort to avoid permanent changes to the building which, in the opinion of the Building Official, would not be characteristic of an industrial use. Approval is based on the finding that the proposed use will not interfere with the City's long-range objectives of encouraging industrial development in the area due to the temporary nature of the permit and the minimal alterations to the property. A MOTION WAS MADE BY CLINT HERBST AND SECONDED BY ROGER CARLSON TO APPROVE THE CONSENT AGENDA AS RECOMMENDED. Motion carried unanimously. CHAPTER 15B "I-1" LIGHT INDUSTRIAL DISTRICT SECTION: 15B-1: Purpose 15B-2: Permitted Uses 15B-3: Permitted Accessory Uses 15B-4: Conditional Uses 15B-5: Interim Uses 15B-1: PURPOSE: The purpose of the "I-1," light industrial, district is to provide for the establishment of warehousing and light industrial development. 15B-2: PERMITTED USES: The following are permitted uses in an "I-1" district: [A] Radio and television. [B] Research laboratories. [C] Trade school. [D] Machine shops. [E] Paint mixing. [F] Bus terminals and maintenance garage. [G] Warehouses. [H] Laboratories. [I] Essential services. [J] Governmental and public utility buildings. [K] Manufacturing, compounding, assembly, or treatment of articles or merchandise. [L] Manufacture of musical instruments, novelties, and molded rubber products. MONTICELLO ZONING ORDINANCE [M] Manufacture or assembly of electrical appliances, instruments, and devices. [N] Manufacture ofpottery or other similar ceramic products using only previously pulverized clay and kilns fired only by electricity or natural gas. [O] Manufacture and repair of electrical signs, advertising structure, light sheet metal products, including heating and ventilation equipment. [P] Blacksmith, welding, or other metal shop. [Q] Laundries, carpet, and rug cleaning. [R] Bottling establishments. [S] Building material sales and storage. [T] Broadcasting antennae, television, and radio. [U] Camera and photographic supplies manufacturing. [V] Cartage and express facilities. [W] Stationery, bookbinding, and other types of manufacturing of paper and related products but not processing of raw materials for paper production. [X] Dry cleaning establishments and laundries. [Y] Electric light or power generating stations, electrical and electronic products manufacture, electrical service shops. [Z] Engraving, printing and publishing. [AA] Jewelry manufacturing. [BB] Medical, dental, and optical laboratories. [CC] Storage or warehousing. [DD] Wholesale business and office establishments. 15B-3: PERMITTED ACCESSORY USES: The following are permitted accessory uses in an "I-1"district: MONTICELLO ZONING ORDINANCE [A] All permitted accessory uses as allowed in the 'B-4" district. 15B-4: CONDITIONAL USES: The following are conditional uses in an "I-1" district: (Requires a conditional use permit based upon procedures set forth in and regulated by Chapter 22 of this ordinance). [A] Open and outdoor storage as an accessory use provided that: 1. The area is fenced and screened from view of neighboring residential uses or, if abutting a residential district, in compliance with Chapter 3, Section 2 [G), of this ordinance. 2. Storage is screened from view from the public right-of--way in compliance with Chapter 3, Section 2 [G], of this ordinance. Storage area is grassed or surfaced to control dust. 4. All lighting shall be hooded and so directed that the light source shall not be visible from the public right-of--way or from neighboring residences and shall be in compliance with Chapter 3, Section 2 [H], of this ordinance. The provisions of Chapter 22 of this ordinance are considered and satisfactorily met. [B] Open or outdoor service, sale, and rental as a principal or an accessory use and including sales in or from motorized vehicles, trailers, or wagons provided that: Accessory outside service, sales, and equipment rental connected with a principal use is limited to thirty (30) percent of the gross floor area of the principal use. 2. Outside sales areas are fenced or screened from view of neighboring residential uses or an abutting residential district in compliance with Chapter 3, Section 2 [G], of this ordinance. 3. All lighting shall be hooded and so directed that the light source shall not be visible from the public right-of--way or from neighboring residences and shall be in compliance with Chapter 3, Section 2 [H], of this ordinance. 4. Sales area is grassed or surfaced to control dust. MONTICELLO ZONING ORDINANCE 5. The provisions of Chapter 22 of this ordinance are considered and satisfactorily met. [C] Industrial planned unit development as regulated by Chapter 20 of this ordinance. [D] Amusement places (such as roller rinks and dance halls) and bowling alleys. [E] Consignment sales provided that: 1. Sales and storage are not to exceed 1,000 square feet in area. 2. At least 80% of the sales shall be of consigned merchandise. 3. No auctions shall take place on the premises. 4. There shall be no outside storage. 5. The provisions of Chapter 22 are considered and satisfactorily met. 6. The parking requirements of Chapter 3, Section 5, are complied with in full. [F] Automobile repair -major and/or minor: 1. The entire site other than that taken up by a building, structure, or plantings shall be surfaced with a material to control dust and drainage which is subject to the approval of the City Engineer. 2. A drainage system subject to the approval of the City Engineer shall be installed. The lighting shall be accomplished in such a way as to have no direct source of light visible from adjacent land in residential use or from the public right-of--way and shall be in compliance with Chapter 3, Section 2 [H], of this ordinance. 4. At the boundaries of a residential district, a strip of not less than five (5) feet shall be landscaped and screened in compliance with Chapter 3, Section 7 [G], of this ordinance. Parking or car magazine storage space shall be screened from view of abutting residential districts in compliance with Chapter 3, MONTICELLO ZONING ORDINANCE Section 2 [G], of this ordinance. All signing and informational or visual communication devices shall be minimized and shall be in compliance with Chapter 3, Section 9, of this ordinance. 7. Provisions are made to control and reduce noise. No outside storage except as allowed in compliance with Chapter 13, Section 4, of this ordinance. 9. All conditions pertaining to a specific site are subject to change when the Council, upon investigation in relation to a formal request, fords that the general welfare and public betterment can be served as well or better by modifying the conditions. 10. The provisions of Chapter 22 of this ordinance are considered and satisfactorily met. [G] Truck/heavy equipment repair 1. The entire site other than taken up by a building, structure, or plantings shall be surfaced with a material to control dust and drainage which is subject to the approval of the City Engineer. 2. A drainage system subject to the approval of the City Engineer shall be installed. 3. The lighting shall be accomplished in such a way as to have no direct source of light visible from adj acent land in residential use or from the publicright-of--way and shall be in compliance with Chapter 3, Section 2 [H], of this ordinance. 4. At the boundaries of a residential district, a strip of not less than five (5) feet shall be landscaped and screened in compliance with Chapter 3, Section 7 [G], of this ordinance. 5. Parking or car magazine storage space shall be screened from view of abutting residential districts in compliance with Chapter 3, Section 2 [G], of this ordinance. 6. All signing and informational or visual communication devices shall be minimized and shall be in compliance with Chapter 3, Section 9, of this ordinance. MONTICELLO ZONING ORDINANCE 7. Provisions are made to control and reduce noise. No outside storage except as allowed in compliance with Chapter 13, Section 4, of this ordinance. 9. All conditions pertaining to a specific site are subject to change when the Council, upon investigation in relation to a formal request, finds that the general welfare and public betterment can be served as well or better by modifying the conditions. 10. The provisions of Chapter 22 of this ordinance are considered and satisfactorily met. 11. A specific area shall be designated for the exterior storage of semi- truck trailers and/or other vehicles and/or equipment accessory and incidental to the truck which is being repaired serviced. [H] Prototype rubber burning furnace incidental to principal use provided that: Furnace must meet all existing or future air emission standards as established by federal or state pollution control agencies. 2. Stack height must be high enough to eliminate potential of stack gases being trapped at ground level by the effect of wind flow around buildings. On or before a date determined by the City, fumace owner will complete all emissions testing on prototype furnace and will apply for an air emission permit from the PCA even if exempt from PCA regulations. Furnace design must meet or exceed proportional requirements fora 1 million BTU furnace as required by the PCA. Failure of emission tests during prototype development or failure to obtain permission to sell this product in Minnesota shall terninate conditional use permit. 4. Regular use of the furnace shall be limited to the heating season. Non-heating season use of the system shall be limited to testing and demonstration. Furnace shall not by operated for the sole purpose of reducing waste tires. A 6-foot, 90% opaque fence shall be used to screen waste tire storage areas. No waste tires shall be in plain view. 6. Complaints made by area property owners about the furnace MONTICELLO ZONING ORDINANCE emissions maybe sufficient cause for the City to withdraw the conditional use permit and therefore halt furnace operation. 7. If it is determined by the Minnesota Pollution Control Agency that waste ash is hazardous waste, it shall be disposed of in a manner approved by the City of Monticello and the Minnesota Pollution Control Agency. (#188, 5/14/90) (#222, 2/24/92) 4[A]. [I] Outdoor go-cart tracks provided that: 1. The proposed use must meet all conditions of Chapter 3, Section 2. The conditional use permit will be reviewed yearly to determine whether or not it is compatible with neighboring properties and in conformance with conditions of the conditional use. 3. A solid wood, six-foot high fence must be part of the screening required when the adjacent property is residential. controlled 4. Dust and noise (70DB at residential property line) must be at all times to the satisfaction of the City. The provisions of Chapter 22 of this ordinance are considered and satisfactorily met. (#313, 6/8/98) 15B-5: INTERIM USES: The following are interim uses in an I 1 District (requires an interim use permit based on the procedures set forth in and regulated by Chapter 22 of this ordinance): [A] Public educational institutions, limited to schools for elementary, junior high, and senior high aged students, provided that: A specified termination date is documented. 2. The proposed parcel has adequate improved parking to accommodate the student capacity. The proposed building is constructed or altered only in ways which do not interfere with future refitting for industrial use. (#295, 9/8/97) MONTICELLO ZONING ORDINANCE City Council Agenda - 06/08/09 SD. Consideration of a request for extension of a Conditional Use Permit for Concert Stage and Development Stage Planned Unit Development approval for amulti-tenant shopping center, a Conditional Use Permit for Outdoor Storage, a Conditional Use Permit for a Car Wash, a Conditional Use Permit for a Motor Fuel Station/Convenience Store, a Conditional Use Permit for minor auto repair, and Preliminary Plat approval. Applicant: Mills Properties, Inc. (AS) A. REFERENCE AND BACKGROUND Planning Commission reviewed this item during their regular meeting on June 2"d. The Planning Commission discussed the applicant's request for atwo-year extension. Citing the need for consistency with past extensions for CUP and preliminary plat and the desire to communicate with the applicant on a regular basis as to the status of their development, the Planning Commission recommended aone-year extension. The Planning Commission was unanimous in their recommendation. On June 12`", 2007, the Planning Commission reviewed and recommended approval of a concept and development stage planned unit development and preliminary plat request for the proposed Mills Fleet Farm project, submitted by Mills Properties, Inc. The City Council subsequently approved the requests on June 25`", 2007. On June 9`", 2008, the City Council (with the recommendation of the Planning Commission) granted the applicant an extension of the conditional use permit and preliminary plat for one year. Due to non-use, the conditional use permit for PUD and preliminary plat will expire on June 9th, 2009. The Monticello Zoning Ordinance requires that conditional use permits expire due to non-use after one year. The Subdivision Ordinance requires that all preliminary platted property be final platted within 1 year. The extension letter sent by the applicant requests a two year extension period. The letter cites the economic conditions as the foundation for this request. The planning report for the original item has been provided for reference. B. ALTERNATIVE ACTIONS The Planning Commission recommends alternative 1 below. 1. Motion to approve an extension of the June 25`", 2007 Conditional Use Permit for Concept and Development Stage Planned Unit Development and Preliminary Plat for the proposed Mills Fleet Farm for a period of one year, with the condition that all previously approved conditions be assigned to the extension. (Consistent with the Planning Commission's recommendation.) 2. Motion to approve an extension of the June 25`", 2007 Conditional Use Permit for Concept and Development Stage Planned Unit Development and Preliminary Plat for the proposed Mills Fleet Farm for a period of two years, with the condition that all previously approved conditions be assigned to the extension. (Consistent with the applicant's request.) City Council Agenda - 06/08/09 3. Motion. to deny an extension of the June 25`", 2007 Conditional Use Permit Concept and Development Stage Planned Unit Development and Preliminary Plat for the proposed Mills Fleet Farm, based on a finding to be made by the Planning Commission. 4. Motion of other. C. STAFF RECOMMENDATION Staff recommends extension of the CUPS and preliminary plat, at a period to be determined by the City Council. Although the Commission has typically granted one year extensions, the Commission has consistently recommended for the extension. D. SUPPORTING DATA Exhibit A: Applicant Extension Request Exhibit B: Staff Report for City Council - 6/9/08 Exhibit E: Site Plans 2 ~I~IIDSETH SMITH ~jOLTING May 5, 2009 Jeff O'Neill, City Administrator City of Monticello 505 Walnut St. Suite #1 Monticello, MN 55362 Re: Mills Properties Inc. Mills Fleet Farm -Monticello, MN 0115B0070.000 Dear Mr. O'Neill: At the request of our client, Mills Properties Inc., we would like to again apply for an extension on the permitting approvals that have been granted by the City. This request is being made after a lot of thought and discussion by our client. No one expected that we would be in this kind of recession when the original requests were made and approvals were granted. Because of the economy, our client has decided to be proactive and delay construction of new stores until a better picture of the economy emerges. No one knows how long this recession will last either, so to prevent having to come to you again next year, they have requested that we obtain a two year extension if that is possible Please advise when this request will be taken up by the City so that we can attend to answer any questions you or the City, may have. In the meantime, if you have any questions, please feel free to contact me. Sincerely, Widseth Smith Notting & Associates, Inc. ruce. R. Buxton, P.E./L.S. Project Engineer cc: Stewart C. Mills, Jr Henry C. Mills II Ron Obeidzinski M:\0115B0070-Monticello\0115B0070.000-New Store\Correspondence\Permits\Extension request 5-3-2009.doc 7804 Industrial Park Road ^ PO Box 2720 ^ Baxter, MN 56425-2720 ^ rE~: 218.829.51 17 ^ FAx: 218.829.2517 ^ wea: www.wsn-mn.com ENGINEERING ARCHITECTURE LAND SURVEYING ENVIRONMENTAL SERVICES ~ ~c...r~. .y ~-„ ~~- aoo z , o0 9 City Council Agenda - 06/09/08 SD. Consideration to approve an extension of a Conditional Use Permit for Concept Stage and Development Stage Planned Unit Development approval for amulti-tenant shopping center, a Conditional Use Permit for Outdoor Storage, a Conditional Use Permit for a Car Wash, a Conditional Use Permit for a Motor Fuel Station/Convenience Store, a Conditional Use Permit for minor auto repair, and Preliminary Plat approval. A. REFERENCE AND BACKGROUND The Planning Commission unanimously recommended approval of the extensian at their June 3rd meeting. On June 12`x, 2007, the Planning Commission reviewed and recommended approval of a concept and development stage planned unit development and preliminary plat request for the proposed Mills Fleet Farm project, submitted by Mills Properties, Inc. The City Council subsequently approved the requests on June 25d', 2007. Due to non-use, the conditional use permit for PUD and preliminary plat will expire on June 25th, 2008. The Monticello Zoning Ordinance requires that conditional use permits expire due to non- use after one year. The Subdivision Ordinance requires that all preliminary platted property be final platted within 1 year. The extension letter sent by the applicant does not reference a specific timeline for the extension period. The extension letter states that no changes are proposed to the approved plan. The planning report for the original item has been provided for reference. B. ALTERNATIVE ACTIONS The Planning Commission recommends alternative 1 below. 1. Motion to extend the June 25d`, 2007 Conditional Use Permit for Concept and Development Stage Planned Unit Development and Preliminary Plat for the proposed Mills Fleet Farm to a date to be specified by the Commission, with the condition that all previously approved conditions be assigned to the extension. 2. Motion to deny an extension of the June 25th, 2007 Conditional Use Permit Concept and Development Stage Planned Unit Development and Preliminary Plat for the proposed Mills Fleet Farm, based on a fording to be made by the Planning Commission. C. STAFF RECOMMENDATION Staff recommends extension of the CUPS and preliminary plat. This recommendation is consistent with the Council's recent one-year extensions for other conditional use and preliminary plat projects. D. SUPPORTING DATA Exhibit A: Applicant Extension Request Exhibit B: Staff Report for Planning Commission -June 12d', 2007 Exhibit C: City Council minutes of June 25d', 2007 Exhibit E: Site Plans ~~ MILLS PROPERTIES, INC. 512 Laurel Street P.O. Box 5055 Brainerd, MN 56401 218-829-3521 May 21, 2008 Jeff O'Neill, Administrator City of Monticello 505 Walnut St. Suite #1 Monticello, MN 55362 Re: Mills Properties Inc. Mills Fleet Farm -Monticello, MN Extension of Conditional Use Permit Approvals Dear Mr. O"Neill: This letter is to serve as a formal request to extend the Conditional Use Permit for Concept Stage Planned Unit Development approvals we have received to date on the referenced project. We understand they expire on June 25, 2008. As permitted by Chapter 22 of your Zoning Ordinance, we, as the applicant, are allowed to apply for an extension at least 30 days prior to expiration. Please consider this as that formal request with no proposed changes. As discussed during the meetings, we have several projects on which we are working and we are unable to begin this project prior to expiration of the approvals. Please advise the schedule for the meetings at which this will be considered, if any. Also advise if our presence is needed. We appreciate your consideration and look forward to receiving the extension to allow us time to complete other projects prior to starting construction on our new store in Monticello. If you have any questions, please do not hesitate to contact us. Sincerely, Mills Properties, Inc. Stewart C. Mills, Jr. Co-Owner cc: Henry C. Mills II Ron Obeidzinski Bruce R. Buxton Charlie Pfeffer I:\EBH12DD6\RONUAONTICELLO EXT 5-21.doc Planning Commission Agenda - 06/12/07 J~ 4. Public Hearing -Consideration of a reauest for a Conditional Use Permit for Concept Stage and Development Stage Planned Unit Development approval for amulti-tenant shopping center, a Conditional Use Permit for Outdoor Storage, a Conditional Use Permit for a Car Wash, a Conditional Use Permit for a Motor Fuel Station/Convenience Store, a Conditional Use Permit for minor auto repair, and Preliminary Plat approval. Applicant: Mills Fleet Farm. (NAC) BACKGROUND Fleet Farm is seeking a Conditional Use Permit for concept stage and development stage Planned Unit Development for the construction of a big box retail store, gas station, and car wash, as well as Preliminary Plat approval. The applicant is also requesting approval of a Conditional Use Permit for outdoor storage, a Conditional Use Permit for a car wash, a Conditional Use Permit for a motor fuel station/convenience store and a Conditional Use Permit for minor auto repair. The total site is 36.04 acres in size and is located within the Monticello Commerce Center on Chelsea Road. The applicant is proposing a 273,201 square foot retail building with outdoor storage on the south side of Chelsea Road and a 4,378 square foot motor fuel station with a car wash on the north side of Chelsea Road. Both sites are currently zoned I-lA, Light Industrial. A request for Rezoning and ~ ' a Comprehensive Plan Amendment is currently being considered by the City for the site as part of a separate application. The applicant submitted a request for rezoning to B-4, Regional Business on the north side of Chelsea Road, and B-4, Regional Business on the south side of Chelsea Road. However, it should be noted that the applicant's narrative request submitted with the north side rezoning request refers to a request for B-3, Highway Business Zoning. On June 5~, the Planning Commission recommended approval of rezoning for the north side parcel to B-3. As the B-3 District includes the requested conditional uses, that district has been used for analysis purposes in this report. It should be noted that the B-4 zoning district would include as permitted or conditional all the uses of a B-3 district. The rezoning requests were heard by the Planning Commission at their May and June regular meetings, and will be acted on by the City Council on June 25~', 2007. ANALYSIS The subject site is located on Chelsea Road East, within the existing Monticello Commerce Center. The site is directly south of Interstate 94 and west of the CSAH 18 interchange. The site relies on PUD for shared parking, proof of parking, building height, and multiple buildings. Comprehensive Plan: Monticello's Comprehensive Plan currently designates this area for industrial use. Planning Commission Agenda - 06/12/07 As an additional condition of approval, staff recommends that no exterior racking be allowed anywhere on the site. Car Wash. The applicant is proposing afour-bay, touchless car wash on the north side of the motor fuel station site, on Lot 1, Block 2. Car washes are permitted by Conditional Use Permit in the B-3 District, subject to the following conditions: 1. The architectural appearance and functional plan of the building and site shall not be so dissimilar to the existing buildings or area as to cause impairment in property values or constitute a blighting influence within a reasonable distance of the lot. Comment: The architectural appearance of the proposed buildings and function of the site will not be detrimental to the surrounding properties. However, staff provides additional comments on the overall design of the car wash in the "building design "section of this report. 2. Magazining or stacking space is constructed to accommodate that number of vehicles which can be washed during a maximum 30 minute period and shall be subject to the approval of the City Engineer. Comment: The site has approximately 180 feet of stacking space, adequate for up to nine vehicles. The proposed stacking space appears appropriate for the four car wash stalls. 3. At the boundaries of a residential district a strip of not less than five feet shall be landscaped and screened in compliance with Chapter 3 Section 2 G of this ordinance. Comment: The site does not abut any residential districts. 4. Each light standard island and all islands in the parking lot shall be landscaped or covered. Comment: No lighting plan has been submitted at this time. Said plan shall be required as a condition of approval. Parking or car magazine storage space shall be screened from view of abutting residential districts in compliance with Chapter 3 Section 2 G of this ordinance. Comment: The site does not abut any residential districts. 6. The entire area other than occupied by the buildings or plantings shall be surfaced with material which will control dust and drainage which is subject to the approval of the City Engineer. Planning Commission Agenda - 06/12/07 2. The architectural appearance and functional plan of the building and site F`" shall not be so dissimilar to the existing buildings or area as to cause impairment in property values or constitute a blighting influence within a reasonable distance of the lot. Comment: The architectural appearance of the proposed buildings and function of the site will not be detrimental to the surrounding properties. However, staff does have concerns regarding the architectural appearance of the buildings as related to the site's freeway visibility. These concerns are discussed later in this report. 3. The entire site other than that taken up by a building structure or plantings shall be surfaced with a material to control dust and drainage which is subject to the approval of the City Engineer. Comment: The site is proposed to be surfaced with bituminous and concrete. 4. A minimum lot area of twenty two thousand five hundred (22,500) square feet and minimum lot dimensions of one hundred fifty (150) feet by one hundred thirty (130) feet. Comment: The subject site is 103, 673 square feet in area, 205 feet wide and 547 feet deep. 5. A drainage system subject to the approval of the City Engineer shall be installed. Comment.• The City Engineer has reviewed the grading and drainage plans and has provided comments. These comments are detailed in a memo from the City Engineer dated June 4, 2007, and compliance with these comments will be required as a condition of approval. 6. A curb not less than six 6 inches above grade shall separate the public sidewalk from motor vehicle service areas. Comment.• There is no public sidewalk adjacent to the motor vehicle service area. 7. The lighting shall be accomplished in such away as to have no direct source of light visible from adjacent land in residential use or from the public right of way and shall be in compliance with Chapter 3 Section 2 H of this ordinance. Comment: No lighting plan has been submitted at this time. Said plan shall be required as a condition of approval. Planning Commission Agenda - 06/12/07 No outdoor sales and display within the PUD will be permitted without the separate review and approval of a conditional use permit for that purpose. 16. Sale of products other than those specifically mentioned in Chapter 13 Section 4 be subject to a conditional use permit and be in compliance with Chapter 13 Section 4 F of this ordinance. 17. All conditions pertaining to a specific site are subject to change when the Council upon investigation in relation to a formal request finds that the general welfare and public betterment can be served as well or better by modifying the conditions. 18. The provisions of Chapter 22 of this ordinance are considered and satisfactorily met. Minor Auto Repair. The applicant is proposing an auto service center within the big box retail store where minor auto repair will be performed. The auto service center is located on the south side of the building, adjacent to Chelsea Road. Minor auto repair is allowed by Conditional Use Permit, subject to the same 18 conditions outlined above for the motor fuel station/convenience store use. The proposed auto service center is entirely enclosed within the principal building. Therefore, all conditions of approval are being evaluated as part of the big box retail store. Lot Requirements and Setbacks. The applicant has requested rezoning for the south portion of the site from I-lA to B-4, Regional Business. There is no minimum lot size or setback requirement for the B-4 District. On the north side of Chelsea Road, the B-3, Highway Business standards were applied. The following chart demonstrates the applicable performance requirements of the B-3 District, as well as what is proposed for the site: Re wired Pro osed Ivlinimum Lot Size 22,500 sf 103,673 sf Lot Width 100 feet 205 feet Front Yard Setback 30 feet 50 feet Side Yard Setback 10 feet 30 feet Rear Yard Setback 30 feet 118 feet No minimum lot area is required for the B-3 District. However, the. proposed motor fuel station use requires a minimum lot size of 22,500 square feet. The proposed car wash and convenience store buildings and accessory uses on the north side of Chelsea Road meet all setback requirements, as demonstrated above. Parking. The applicant is proposing a retail store with an auto center, warehouse and office space, a convenience store/gas station, and a car wash. Staff has Planning Commission Agenda - 06/ 12/07 The majority of the trees proposed are around the perimeter of the site and within parking lot islands. The applicant has provided 31 landscaped islands within the parking lot to break up the monotony of this large space. A total of nine overstory trees and ten shrubs are proposed on the north side of the retail building to screen the auto service center from Chelsea Road. The applicant has also provided a number of shrubs throughout the site. Future Retail Site Landscaping Lot 2 of Block 1, the future development site, contains 1816 feet of site perimeter, requiring 37 overstory trees. No trees are proposed for the. future development site at this time, as landscaping for that area will be provided at the time of development. South Site Buffer Yard Landscaping In addition to the minimum landscape requirement, a buffer yard is also required adjacent to the south property line, due to the conflict in uses between the big box commercial retailer and the High School. A commercial to institutional land use conflict is considered an "A" level conflict. This conflict requires a 10 foot landscaped yard with a minimum of 40 plant units. The applicant is responsible for one half of this requirement. The applicant has provided a landscaped yard with 430 plant units along the south property line, satisfying the buffer yard requirement. The site borders an industrial use to the east, which is a level "B" conflict. The buffer yard requirement for the east property line is a 20 foot minimum landscaped yard with 80 plant units. The applicant has provided a 20 foot landscaped yard along the east property line with 470 plant units. The minimum requirement is therefore met in this location as well, and the industrial user to the east will not be responsible for any buffer yard plantings. North Side Site Landscaping The gas convenience store/car wash site contains 1424.58 feet of site perimeter, requiring 28 overstory trees, versus the nine that would be required under the floor area calculation. As such, the perimeter requirement shall prevail. The applicant has provided 28 overstory trees, satisfying the minimum requirement. Trees provided include Douglas Fir, Colorado Blue Spruce, Austrian Pine, Little Leaf Linden, River Birch, Common Hackberry and Manchurian Ash. The majority of the trees provided are along the site perimeter and within the vacuum island adjacent to the car wash. The applicant has also provided a number of shrubs. Shrubs are proposed between the overstory trees around the perimeter, and surrounding the pylon sign and monument sign. Planning Commission Agenda - 06/12/07 _ a height of 57 feet was pernlitted by PUD, provided that other signs in the project were limited to wall or monument signs, due to the size of the overall development and the size and number of the retail stores and other uses. The Union Crossings development contains Target, Home Depot, an inline retail center, a detached strip retail center, and other proposed uses. The subject Fleet Farm site is much smaller than the Union Crossings site, and contains only one user. Additionally, the site includes a provision fora 67 foot tall silo as part of the big box site. In that regard, staff does not believe the proposed 400 square foot sign at 50 feet in height is appropriate for the site. The site is within 800 feet of the freeway and is therefore allowed a freeway standard sign up to 32 feet in height and 200 square feet in area on either the north or south side of Chelsea Road. In that regard, staff recommends that the applicant reduce the size of the proposed pylon sign to not exceed 200 square feet and limit height to 32-feet. . North Side Wall Si~r~a,~e For the motor fuel store, wall signage up to 10 percent of the total fagade may be provided for the site, not to exceed 100 square feet. The front fagade of the building is 956.5 square feet in area. The rear fagade is visible from I-94, for an additiona1956.5 square feet of fagade. The use is therefore eligible for 100 square feet of signage. The applicant has proposed four, 40 square foot LED display signs, and four, 32 square foot identification signs within the lighted canopy. Therefore,'the total wall signage proposed is 288 square foot of signage, exceeding the maximum. The applicant is proposing five, 8-foot wall signs for the car wash, as well as three, 9-foot wall signs, for a total of 67 square feet of wall signage. Due to area of the fagade for the car wash, the applicant is eligible for up to 100 square feet of signage. Therefore, the proposed signage is well within the parameters of the ordinance. The applicant has not utilized all wall signage permitted for the car wash, and therefore maybe allotted the remaining 33 square feet to be used on the motor fuel store. However, the applicant has exceeded even the 133 square foot allotment. Staff recommends that the applicant eliminate signage or reduce the size of signage on the convenience store to not exceed 133 square feet. South Side Wall Si~nage On the south side of Chelsea Road, the big_box retailer is visible from both Chelsea Road and Dundas Road. The total fagade on the north elevation, visible from Chelsea Road, is 9,854 square feet. The fagade area on the west elevation, visible from Dundas Road, is approximately 19,435 square feet. Ten percent of total facade area is equal to 2,929 square feet of signage. The ordinance states that the site is eligible for signage equal to 10% of the total fagade, up to 100 11 Planning Commission Agenda - 06/12/07 feet in width. Staff recommends that access to this site be limited to one driveway near the east edge of the site to avoid potential conflicts with vehicles accessing the existing driveway to the west, and that this access also include a protected right-turn lane along Chelsea Road. The site is designed so that customers purchasing fuel can pull into the site, circle through the fuel pump area, and exit back out onto Chelsea Road. As such, the fuel pumps are oriented to be parallel with Chelsea Road. The orientation of the pumps in this manner limits stacking space for waiting vehicles, and creates a very tight site. Due to the depth of the site, there appears to be adequate room to orient the fuel pumps to be perpendicular to Chelsea Road, providing more stacking space. This may require the applicant to shift the convenience store building and car wash to the north. However, as stated above, the site appears to have adequate depth to support such an arrangement. As such, staff recommends reorienting the fuel pumps. Due to the tight conditions on the site, staff also offers the option of relocating the car wash and motor fuel station to the south side of Chelsea Road on Lot 2, Block 1, a 3.87 acre site reserved for future development. This site would allow additional room for access and stacking that is not available on the chosen 2.38 acre site on the north side of Chelsea Road. Pedestrian access through both sites is accommodated through a series of sidewalks at the front of each building. Due to the size of the parking lot and the ;" amount of traffic expected, staff recommends that the applicant provide pedestrian crossing striping and pedestrian curb ramps between the parking lot and the front of the Mills Fleet Farm building. For the overall site, the City Engineer and consulting engineer from WSB have reviewed the plans regarding access and street design, and have provided the following comments: 1. Only one access towards the east side of the site north of Chelsea Road will be allowed. There appears to be ample room on site to push the building to the north to provide acceptable levels of circulation for all vehicles on site. 2. Right-turn lanes should be provided at all access locations on Chelsea Road. 3. The temporary cul-de-sac at the east end of Dundas Road, just west of the Mills Fleet Farm building, must be reconstructed as a permanent cul-de- sac as part of this project. This may require using some land on the Fleet Farm site. 4. Provide pedestrian crossing striping and pedestrian curb ramps as needed between the parking lot and the front of the Mills Fleet Farm building. As a note on this item, for the south side retail site, planning staff have recommended scored concrete and pavers as an alternative to striped 13 Planning Commission Agenda - 06/12/07 development will beheld to higher standards of site and building design than would ordinarily be required. In keeping with the intent of this ordinance, staff recommends that the applicant revise the elevations for the big box retail store to provide additional aesthetic details to break up the long fagade. Specifically, staff recommends that the applicant provide additional vertical details, roofline variations, and materials in contrasting, but coordinating colors. Staff recommends that said details be applied to all four sides of the building, with the emphasis on the east, north, and west elevations.. Similar requirements were applied to previously approved big box retail stores in the City, including Target and Wa1Mart. Furthermore, staff recommends that the applicant consider an alternate color for the top of the proposed silo. The applicant is proposing a silo nearly 68 feet in height with an orange cap. While staff recognizes that this silo is a signature element for all Fleet Farm stores, the color appears to be out of character with the surrounding area. Staff recommends that the silo cap be white or cream in color, similar to the Lakeville store, to increase the aesthetic quality of the site. Grading and Drainage. The City Engineer and consulting engineer from WSB have reviewed the grading and drainage plans and provided the following comments: 1. Based on the proposed use of the property north of Chelsea Road as a fueling station the City is requesting that the storm sewer system serving this site be routed through the High School Pond to the south, rather than routing it to the west along Chelsea Road. 2. The grading of the infield area between the two entrances to the Mills Fleet Farm site south of Chelsea Road should be revised to provide positive drainage to the storm sewer structure located in the middle of this area. Is there a reason that this has been graded as a low area? 3. Combine the two storm sewer outlets to the High School Pond into one outlet at the south end of the parking lot. 4. Provide all required drainage and utility easements around the perimeter of both sites. 5. A minimum pavement grade of 2% is recommended throughout the parking lot. Utilities. Regarding the utility plan submitted, the City Engineer, Public Works Director, and consulting engineer have provided the following comments: 1. Replace a1190-degree watermain bends with two 45-degree bends with a minimum of 10-feet of watermain between the bends. 2. Provide profiles of all utilities at crossing locations to make sure no conflicts exist. 3. If any portion of the southerly site is to be split off and sold at a later date it must have its own utility services in order to do so. 15 Planning Commission Agenda - 06/12/07 B. Motion to recommend denial of the Conditional Use Permit for a Open and Outdoor Storage, based on a finding that the conditions for approval have not been met. Decision 3. Regarding the request for a Conditional Use Permit for a Car Wash, the City has the following options: A. Motion to recommend approval of the Conditional Use Permit for a Car Wash, based on a finding that the proposed use is consistent with the intent of the B-3 District and the use satisfies the conditions of approval. B. Motion to recommend denial of the Conditional Use Permit for a Car Wash, based on a finding that the conditions for approval have not been met. Decision 4. Regarding the request for a Conditional Use Permit for a Motor Fuel Station/Convenience Store, the City has the following options: A. Motion to recommend approval of the Conditional Use Permit for a Motor Fuel Station/Convenience Store, based on a finding that the proposed use is consistent with the intent of the B-3 District and the use satisfies the conditions of approval. B. Motion to recommend denial of the Conditional Use Permit for a Motor Fuel Station/Convenience Store, based on a finding that the conditions for approval have not been met. Decision 5. Regarding the request for a Conditional Use Permit for Minor Auto Repair, the City has the following options: A. Motion to recommend approval of the Conditional Use Permit for Minor Auto Repair, based on a finding that the proposed use is consistent with the intent of the B-4 District and the use satisfies the conditions of approval. B. Motion to recommend denial of the Conditional Use Permit for Minor Auto Repair, based on a finding that the conditions for approval have not been met. RECOMMENDATION Mills Fleet Farm is requesting Concept Stage Planned Unit Development and Preliminary Plat approval, as well as approval of four conditional use permits. All requested approvals are contingent on the sites being rezoned from the existing I-lA zoning to B-3, Highway Business and/or B-4, Regional Business. 17 Planning Commission Agenda - 06/12/07 SUPPORTING DATA Exhibit A: Applicant Narrative Exhibit B: Existing Conditions Exhibit C: Site Plan Exhibit D: Grading Plan Exhibit E: Utility Plan Exhibit F: Erosion Control Plan Exhibit G: Overall Landscape Plan Exhibit H: Typical Floor Plan Exhibit I: Retail Store Elevations Exhibit J: Convenience Store Floor Plan Exhibit K: Convenience Store Elevations Exhibit L: Car Wash Floor Plan Exhibit M: Car Wash Elevations Exhibit N: Yard Entrance Floor Plan and Perimeter Packing Elevations Exhibit O: Seasonal Display Elevations Exhibit P: Typical Signage Exhibit Q: Sample Site Photometric Plan Exhibit R: Photos of Lakeville Site Exhibit S: City Engineers Memo -June 4, 2007 Exhibit Z: Conditions of Approval 19 Planning Commission Agenda- 06/12/07 14. The applicant shall revise all elevations for the big box retail store to provide (f additional vertical details, roofline variations, and materials in contrasting, but coordinating colors. 15. The applicant shall revise the car wash design to provide alternate building materials with more visual detail, or relocate the car wash to Lot 2, Block 1. 16. The cap of the proposed silo shall be white or cream in color, as opposed to orange. 17. The applicant shall comply with all recommendations of the City Engineer, as outlined in his memo dated June 4, 2007. 18. The applicant shall verify the directional arrows and directional labels on all plans. 21 City Council Minutes: 6/25/07 9G the workshop. Clint Herbst asked if the Building Department staff would go through the ~~` inspection information from HUD and MHFA and get back to the Council if these agencies' inspections are lacking in certain areas and also look at the fee changes suggested. This information can be considered at the next meeting if all the information is obtained. Gary Anderson asked if there were any other concerns the Council wanted to address at this time so that everything could be dealt with at the next meeting and not have to be brought back again. This will come back as a regular agenda item. Tom Scott indicated that the staff and legal counsel should be able to do the research and make the changes for the next meeting. SUSIE WOJCHOUSKI MOVED TO TABLE ADOPTION OF THE RENTAL PROPERTY LICENSING ORDINANCE, PROPERTY MAINTENANCE CODE AND FEE SCHEDULE UNTIL THE NEXT MEETING. TOM PERRAULT SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. . 8. Consideration of a declaration of negative EAW impact -Applicant: Mills Properties, Inc. Consulting Engineer, Bret Weiss noted that the 30 day comment period for the Environmental Assessment Worksheet for Mills Fleet Farm had passed and to date no comments had been received from any agencies. Therefore they were recommending the City issue a Negative Declaration of need for an EIS for Mills Fleet Farm. TOM PERRAULT MOVED TO ISSUE A NEGATIVE DECLARATION OF NEED FOR AN EIS FOR MILLS FLEET FARM DEVELOPMENT. BRIAN STUMPF SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 9. Consideration of a re nest for Com rehensive Plan Amendment for a change in land use designation from industrial to commercial and a request for rezoning from I-lA (Light Industrial) to B 3 (Limited Business) -North side of East Chelsea Road. Applicant: Mills Properties. Inc. Consulting Planner, Steve Grittman provided the background information for agenda items #9 and #10 relating to rezoning issues for the Mills Fleet Farm site. The property on the north side of Chelsea Road is a 2.3 acre site. The applicant is requesting a comp plan amendment to change the use from industrial to commercial and a rezoning of the property from I-lA to B-3 or B-4. The Planning Commission met on this item on June ~, 2007 and met on the parcel on the south side of Chelsea Road in May and again in June. Both sites are guided as industrial and are requested to be changed to commercial. T'he south site is the location for the main store and the north parcel would be the site of the convenience store/gas station. Brian Stumpf pointed out that at the meeting in May only three of the Planning Commission members were present and in June four of the members were present. The Planning Commission recommended 2-1 against any change to the comp plan and rezoning for the property on the south side of Chelsea Road but recommended 2-1 in favor of - the rezoning and comp plan amendment for the property on the north side. The staff report laid out the pros and cons which Steve Grittman briefly summarized. Factors supporting the City Council Minutes: 6/25/07 they have to get the property owners to agree to work out the access issues. The City would %- keep any easements they have. Bret Weiss said there is no reason the City would want to t keep the right-of--way but he questioned whether the property owners could resolve the issues. Clint Herbst asked where the cul-de-sac would be located. Bret Weiss said it would not all go within the right-of--way but would encroach onto the Mills Fleet Farm site. Wayne Mayer agreed that it would be nice to be able to vacate the street. He questioned the value of having a stub road. Susie Wojchouski asked if any promises had been made to anyone relating to Dundas Road. John Simola felt you have to involve those property owners in the decision Clint Herbst felt this item needed further investigation. The reorientiation of the gas pumps was recommended based on one access to the north site. If the City allows the two accesses the relocation of the pumps would not be necessary. The Council felt the convenience store site needed two accesses for movement of traffic and safety considerations. The Planning Commission felt additional fagade improvements to the building should be made and those improvements should be specified in continued discussions with Mills Fleet Farm. Fagade improvements to the rear exposure of the car wash facility was recommended. The Planning Commission felt as a commercial site with the. exposure it has to the freeway there should be some additional improvements made but did not specify what. {' Bruce Buxton addressed the five items. The car wash site has an 85' easement on the north side adjacent to the freeway. That land is being used for stacking for cars entering the carwash. He noted that the carwash is a harsh environments and the design of the building was meant to withstand those conditions. Clint Herbst stated they weren't suggesting drastic change in design merely dressing up what is there. Bruce Buxton felt because the ordinance required that they landscape so that the building is 60% opaque to the freeway the design dressing was not necessary. The building is 14' high and with the landscaping most people won't even see the carwash from the freeway. As far as architectural changes to the building, Mills Fleet Farm offered to take the Council, Planning Commission and staff down to see their facility in Rochester which is currently under construction. Wayne Mayer asked if the pylon sign being used at Rochester was the same one they were proposing for Monticello. The City of Rochester allowed them to place the 400 square foot sign that they had originally asked for here. Bruce Buxton stated that the 400 sq. ft. sign is allowed by conditional use permit under city ordinance. Wayne Mayer asked why staff wanted the sign area reduced. Jeff O'Neill said there was no other sign competition so staff felt it could be smaller. Steve Grittman said the sign of that size is .allowed specifically for shopping centers where there are multiple tenants. Mills Fleet Farm felt they were a shopping center even though they are the only tenant in the facility. Wayne Mayer stated he did not understand why the City was trying to impede their strategy. He felt if it was within City ordinance why not give it to them. Steve Grittman responded that this is a single tenant use not a shopping center. Wayne Mayer felt if you want to Limit signs you achieve it by changing the sign ordinance. Otherwise the City should permit the signage allowed by ordinance. Staff indicated that 32' x 200' is what the ordinance would allow. Rod Dragsten, Planning Commission Chair noted that in looking at the sign, they looked at 11 {~ ii B PRELIMINARY PLAT OF MILLS ADDITION TO MONT~CELLO ~~ coi u .n ~ '~~~ ~, "~ \"~~ ~. ~~ ~. \ ~ i i ; F,:.,.,. 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Consideration to approve an extension of a Conditional Use Permit for Joint Parking and Drives and a Conditional Use Permit for Drive Through-Facility for a commercial development in the CCD (Central Community District). Applicant: Masters St Avenue ~Z A. REFERENCE AND BACKGROUND The Planning Commission reviewed this item on June 2"d, 2009. The Planning Commission unanimously recommended approval of the extension for a period consistent with the timeline requirement for development under the current TIF development agreement. Excerpt from Tax Increment Analysis & Management Plan: Clearance of the site meets criteria to avoid the 4 year knock down requirements. The existing development agreement and note should provide relief from the five year rule. The EDA should obtain legal guidance on application of the five year rule in these circumstances and on the ability to transfer this obligation from the current developer to another parry. The financial implications for this District cannot be analyzed until development occurs. State Law limits the ability of tax increments from this District to be used for other purposes: • The District is subject to the five year rule. The five year period ends August 1, 2011. Masters St" Avenue is requesting a second extension of their conditional use permit for the project known as Landmark Square II. On September 6t", 2005, the Planning Commission reviewed and recommended approval of a Conditional Use Permit for Joint Parking and Drives and a Conditional Use Permit for Drive-Through Facility, submitted by Masters Stn Avenue. The City Council approved the Conditional Use Permits on September 12tH, 2005. Due to non-use, the conditional use permit for PUD would have expired on September 12tH, 2006. The Monticello Zoning Ordinance requires that conditional use permits expire due to non-use after one year. However, in late 2007, the Planning Commission requested that staff notify applicants of their expiration and offer aone-time opportunity to seek an extension. As such, the applicant requested and was granted a subsequent one-year extension in January of 2008. Although the CUP has again been unused for a period exceeding one year, the applicant is again asking the Commission to consider the extension request. The Landmark Square II development is also subject to a Tax Increment Financing District development plan and agreement. The applicant has less approximately two years to develop the property under the terms of that agreement. As such, it is recommended that the extension for the conditional use permit be granted consistent with the TIF agreement timeline. The planning report for the original item has been provided for reference. City Council Agenda- 06/08/09 B. ALTERNATIVE ACTIONS Motion approve an extension of the September 12t", 2005 Conditional Use Permit for Joint Parking and Drives, and aDrive-Through Facility for Masters St" Avenue through August 1, 2011, with the condition that all previously approved conditions be assigned to the extension.. 2. Motion to deny an extension of the September 12t", 2005 Conditional Use Permit for Joint Parking and Drives, and a Conditional Use Permit for Drive-Through Facility for Masters 5`" Avenue based on a finding to be made by the Planning Commission. 3. Motion of other. C. STAFF RECOMMENDATION Staff recommends approval of the extension request. The request is consistent with current and proposed objectives for the Central Community District. The project presented illustrates a plan and building which are consistent with standards outlined within the Downtown Revitalization Plan and Zoning Ordinance. D. SUPPORTING DATA Exhibit A: Staff Report for September 6t", 2007 Exhibit B: Conditional Use Permit Plan documents 2 Planning Commission Agenda - 09/06/05 7. Public Hearing: Consideration of a request for a Conditional Use Permit to allow adrive-through facilih~ in the Central Community District and to allow joint parking and drives, and consideration of a request for Variance from parking lot standards as required by the Monticello Zoning Ordinance. Applicant: Masters Bch Avenue (NAC) REFERENCE AND BACKGROUND Masters Fifth Ave, Inc. is proposing a lot combination to allow fora 10,800 square foot commercial building located on the northeast corner of Locust Street and Third Street. The subject site is zoned CCD, Central Community District. The only user specified thus far for the proposed commercial building is a coffee shop that is proposing to have adrive-through. Drive through windows that are accessory to other principal uses are permitted in the CCD District by conditional use permit (CUP). The applicant is requesting a variance from the off-street parking requirements to allow for a reduced number of parking stalls than that which is required by the Ordinance. Development of the proposed project will be preceded by the demolition of the existing three homes and accessory structures on the site and the applicants have provided a demolition plan, which is subject to the approval of the building official. Comprehensive Plan. The subject site is guided for commercial uses as designated by the Comprehensive Plan. The proposed development is consistent with the future land use plan for the site. Zoning. The subject site is zoned CCD, Central Community District, which allows for commercial/retail buildings and accessory drive through establishments by CUP. CUP Criteria. The proposed drive-through must comply with the CUP criteria outlined in Section 14B-~.E of the City~s Zoning Ordinance: Service through drive-through facilities is accessory to interior on-site or sit- down service within the same building. 2. Drive-through lanes are designed to avoid disruption of pedestrian and vehicular traffic flow, both on and off-site. 3. Landscaping and other site improvements are included. which screen automobile stacking space from the public street. 4. The principal building occupies no less than forty (40) percent of the property. exclusive of easements devoted to public pedestrian use or other outdoor public spaces. Planning Commission Agenda - 09/06/0 ~ ~" ~. The building, site and signage meets the standards for the CCD District, and design review approval is granted by the designated Design Advisory Team. 6. The proposed use demonstrates compatibility and consistency with the City's Comprehensive Plan and the Downtown Revitalization Plan. Comment.' The proposed drive-tl2rough vi~ill be an accessory use to tJ~e coffee shop located within the principal building. The drive-through design will not interfere ~~~it1~ traffic and pedestrian flow. The landscaping plan shows an increase of plantings near the drive-through area ~~~Izich tia~ill screen it from adjacent properties, 12o~~~ever, additional plantings may be necessary to firrthcr screen the area firon2 the public street. The proposed building matey°ials and design Rave not been fully disclosed to City staff at this Time, thus it is unkno~~>>~ ~~~hetl2er or not t1~e design and matey°i.als 1-~~ill be consistent ~~~i~h the Downtol~~n Revitalization Plan. The proposed coffee shop, retail and restaurant use is consistent with the intent of the CCD District. Building and Landscape Plans are also subject to revie~~~ and approval of the Design Advisory Team. Downtown Revitalization Plan. The proposed project is located within the Walnut District as depicted in the Downtown Revitalization Plan. The Walnut District is designed to support small to mid-sized retail, personal and business services, eating establishments and office and upper level residential or office. Furthermore, two- story buildings and orientation towards Walnut Street (depending upon frontage) is encouraged. Lot and Building Requirements. The proposed project is expected to meet the general standards of the CCD District, outlined in Chapter 14B.6 of the Zoning project's compliance along with some general site design comments. Lot Width and Lot Area. The applicant is proposing to combine Lots 1, 2 and 3, Block 36 of Townsite of Monticello. Dimensions of the existing lots are all approximately 1 1,088 square feet (66' x 168'). Combined, the lots will create a lot that is approximately 33,264 square feet (198' x 16$'). The CCD District does i:et have any regulations for lot width or area, thus those proposed by the applicant are acceptable. Setbacks: Building setbacl: minimums and maximums shall be consistent with the recommendations for the use and location and shown in the Downtown Revitalization Plan. The Downtown Revitalization Plan recommends that buildings ~~~ithin the Do~mtown area are placed near to the street to encourage passers-by to look at/into the building and allow views of the street from inside the building. For the Walnut District. the plan suggests abuild-to line of zero feet. Parking. The new retail building is proposed to be approximately 8.100 square feet of retail space and 2.700 square feet of restaurant area. According to these proposed uses and dimensions. the applicant would need to provide 37 spaces for the retail Planning Commission Agenda - 09/06/05 portion (8,100 x 0.9 / 200 = 37) and 51 spaces for the restaurant portion (?,700 x 0.9 x 65% seating area / 40 = 40 and 2,700 x 0.9 x 35% kitchen area / 80 = 11), for a total of 88 new spaces. The proposed plan shows a total of 88 off-street parking stalls for both the existing retail building and the new retail building. The applicant is proposing a shared parking arrangement with the existing businesses to the north of the subject site. Per the City's joint parking requirements, the proposed new building must supply at least 60% of the required parking stalls, in this case, 53 stalls. The existing retail building is required to provide 52 off-street parking spaces. Thus, the total number of off-street parking stalls that should be supplied by both buildings is 105 stalls to comply with joint parking requirements. Since the applicant is only proposing to provide a total of 88 spaces, they are requesting a variance for 17 stalls. It is important to note that on-street parking spaces cannot be added to the total number of spaces provided for off-street parking for the site. However, the City acknowledges that the applicant is proposing to create additional on-street parking adjacent to the site be reconstructing the existing on-street parallel parking into on- street angled parking for a parking stall gain of approximately 20 additional spaces. 11 more than the current on-street supply. As a result, the overall parking supply in the area v,~ill be 8 spaces short of the standard requirement. The applicant should contribute to the City's public parking supply fund for the 8-space shortage. The site plans shows the required handicap stalls as on-street parking. As a condition of approval, the plans must be revised to show the handicap stalls within the required off-street parking area. Additionally, the applicant must redesign the corner betv,~een the on-street parking areas to leave 40 feet from the corner to the curb. The applicant is requesting a variance from the required parking provisions since they will not be able to provide for enough off-street parking on-site. If the variance is approved.. the applicant will be required to pay a fee based on the shortage to the downtown parking fund.. subject to City approval. Access/Circulation. The proposed site will have access off of Third Street and will also be able to utilize the existing access point to the north off of Locust Street. The proposed drive-through window traffic will exit from the site onto Locust Street. The plan does not clearly show the placement of sidewalks along the exterior of the building. The applicant shall install sidewalks along Third Street and Locust Street within the subject development and provide for connectivity to the sidewalk along Locust as it connects to Broadway. V Landscaping. The applicant has submitted a landscaping plan indicating the addition of 13 trees and several smaller shrubs along the eastern perimeter of the proposed parking area. The applicant must submit a plan showing more detail around the perimeter of the building. as well as more dense plantings sun•ounding the parking area to provide for buffering and screening of the parking area from the adjacent Planning Commission Agenda - 09/06/0~~ properties and the roadway, as outlined in Section 3-S.D.9{p) and (o) of the Zoning Ordinance. The parking area is proposed to be surfaced in bituminous and the patio is proposed to be concrete. The landscape plan does not indicate whether or not the parking island will be landscaped. Parking islands must be landscaped following the regulations outlined in Section 3-2.G.11 of the Zoning Ordinance. The applicant must complete landscaping, lighting and sidewalk construction from Landmark Square I Building Materials. The applicant has submitted building elevations, but did not provide detail on proposed building materials. The proposed building design and appears to be consistent with the provisions outlined in Section 4.0 "The Design of Buildings" in the City's Downtown Revitalization Plan, in that the building will be two-story and will provide individual entrances for each tenant. The buildin~ elevations show a variety of windows and brick and stone materials consistent with the Downtov,~n Revitalization Plan guidelines. The applicant must submit proposed building materials, subject to City staff approval. The applicant has suggested that due to the costs of relocating an electrical pole, they may want to reduce building material and/or landscaping quality for the project. Planning staff would suggest that material changes to these elements will require further Planning Commission and City Council review, due to the City's TIF contribution, the interest in building quality in the Downtown Redevelopment area, and the variance to the City's parking requirements being considered for the project. Lighting. The submitted lighting plan shows the addition of five, twenty-foot high filll-cutoff lights placed within the parking area. The applicant shall also install street lights along Third Street and Locust Street, consistent with the existing ornamental street lighting pattern. The proposed lighting is consistent with the permitted foot candle measurements for off-street parking areas as regulated by Section 3-2.H of the Zoning Ordinance. Signage. The applicant has not submitted a detailed signage plan for staff review. Signage shall be consistent with the City's Downtown Revitalization Plan including signs that are incorporated into the building facade. ~~~indows or awnings up to a maximum of 1 square foot of sign area per linear of street facade (measured at the front yard). Proposed signage must also comply with Section 3-9 of the Zoning Ordinance. Easements. Proposed easements. including cross access easements for the entire project as ~~-e11 as sidewalk easements, are subject to the revie~~~ and approval of the City Engineer. 4 Planning Commission Agenda - 09/06/05 Grading, Drainage and Utilities. The applicant must obtain sanitary sewer service connection via Locust Street rather than digging a new service via Third Street as indicated on the site plan. All grading, drainage and utilities are subject to the review and approval of the City Engineer. ALTERNATIVE ACTIONS Decision 1: Conditional Use Permit (CUP) to allow adrive-through facility in the CCD District and to allow for shared parking and drives. Motion to recommend approval of the CUP with the comments listed in Exhibit Z and based upon the findings that the application would comply with the City's Comprehensive Plan, Downtown Revitalization Plan and long-term development goals for the area. Motion to recommend denial of the CUP based upon the findings that the application does not comply with the goals set forth by the Comprehensive Plan and/or the Downtown Revitalization Plan. Motion to table the application to permit further City review and refinement of the proposed plans. Decision 2: Variance from required off-street parking requirements. Motion to recommend approval of the variance with the comments listed in Exhibit Z and based upon the findings that the proposal will comply with the Comprehensive Plan and Downtown Revitalization Plan. 2. Motion to recommend denial of the variance based upon the findings that the proposal will not comply with the goals set forth by the Comprehensive Plan and the Downtown Revitalization Plan. Motion to table the application to permit further City review and refinement of the proposed plan. STAFF RECOMMENDATION Staff recommends approval of the CUP for an accessory drive-through and a variance from the required parking provisions for the proposed development. The proposed uses and the retail building design are consistent ~~-~ith the goals for the CCD District and the provisions outlined in the Zoning Ordinance and the Downtown Revitalization Plan. Planning Commission Agenda - 09/06/0 - , , SUPPORTING DATA Exhibit A -Site Plan (Existing Conditions) Exhibit B - Demolition Plan Exhibit C - Preliminary Plat Exhibit D -Grading Plan Exhibit E - Utility Plan Exhibit F -Lighting Plan Exhibit G -Building Elevations Exhibit H -Landscape Notations Exhibit Z -Recommended Conditions of Approval Planning Commission Agenda - 09/06/05 Exhibit Z Conditions of Approval for Landmark Square Phase II The applicant must submit a revised landscape plan showing screening of the parking and drive-through areas from adjacent properties and the public street. All proposed parking lot islands must also be landscaped. 2. The applicant shall construct the on-street angled parking spaces at his own expense, and pay a fee to the Qeneral downtown parking fiend for any deficiencies in required parking provided. Planning staff calculates the remaining deficiency at a total of 8 parking spaces. On-street parking areas shall be redesigned to show the corner between the on-street parking areas as 40 feet from the corner to the curb and to remove all handicap stalls from the on-street areas to the off-street parking area. The applicant must submit proposed building materials, subject to City staff approval. Material changes to the building quality or landscaping shall require further review by Planning Commission and City Council. The applicant shall install street lights along Third Street and Locust Street, consistent with the existing ornamental street lighting pattern. The applicant shall submit a detailed signage plan upon building permit which is consistent with the City's Downtown Revitalization Plan and Section 3-9 of the Zoning Ordinance. 7. 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Inc. ~ ~ MONTICELLO~ MINNESOTA 7p Oak Ave 5. P.0. Bon 1123 ~M* ar. uo vc uawra Annandale. NN 55302 n ~A SITE PLAN ~ e.. (zza>n.-na ,,..ewa~..a.. W s ra. (uo7 n4-uae am ar. wn PRELIMINARY PLAT ez.zz ow oyx era ltl'ld AtltlNIW1~3Hd om ue mrazw ooa-.a (xc> •°e Ntlld lOH1N00 ~ 'a mxa ~ uu-s<z (oocl ~w r~ NOISOtl3 'B ONIOtltlO U Zl)fSS NN ~opwuuy _'S c~ m~ ~.e xxwa fZll xoB '0'd 'S onV No0 ZL ZZJJ ~ •ou~ •°ossy N Bul~eau~6u3 Ap~eH~d tl1089NNIW '0~13011NOW SNp6N3tl era ,.r<~,.,~.a.~,.r~,.nm,~~ am Azw~aaa 3tlVf1l9S )IHVW~Ntl'1 g "` E' .f ~\ /~~ \~' /~ 6,'! ~~ ~ `~ ~ ~. ~ i~ ~ q g~ % ~ ~~ ~~i •~ ~.°~ ~ eq /n ~-. \~^ V~ 1~ ~, ~ 9 ~ ~ ~ c '~ ~ Oy 7 ~~ / ~ ~" ~ % l /o`~ ~~ ~ '~ ep"` o-~ •f: d°a t /.' a ,°. F a ~~ ~ ~ ~ ~ ~ ~ € ~ ~ ~ F I!<;BF F~ t? ~4 §~ € € 4 4 eF e~ i ~$¢ is ~ $ i'`.. 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I I `^Tf> \ .z`~fi ~\ zAr c ~ / ~~ ~ ~ ~~ ~ a 8sI B ry \ bAQ ~J 1 i ~ ~ hi`~ s ~ +b s ' ~ ~~ ~ ~ ~ ~ ~~ ~~~ i3 ~ ~ ~~~ ~~ i s ! ~ ~ / ~~ \~ , ~ ~ u x` i ~ ,~ Ate, % \\ ~ ~ ~ \ ~\ /~ ~:s~ \/~ .'\~ x6 Nj'"7:'y9 \ / \\ / in9\\ :n ~ /~` I % ~'~ %~ F- :fi 'mil LANDMARK SQUARE DEAGxED 0.D ,M, D'Heilly Englneering & Assoc. Inc. ~ - MONTICELLO• MINNESOTA 72 Oak Ave S. P.0. Bax 1123 ~ ~ ~~~ Annandale, MN 55302 nrm ar. Lm ~w A r<ua mwc ut ~; UTILITY PLAN ~ "F; `(aioi ii.`zzoe wECxw ar: cin g' o•~` PRELIMINARY PLAT ~ hs j 3 E ~ E 3 a ro ~ru V w 0 ~ U S M Q 1 N 0 ~ ~ ; ~ c C 3 ~~ u s ~ 3 µ0 0 ~ ~ ~ u ~ E O ~ ~ E_ }. M U T 1 y ~ = v IL ~ ~ .E n. ~ u o y M u O T M - E Q ~ ~s u ~ µ 0 S ~ ; S C O y E h ~ ~ U = b U A Ll E r n Z .~ ~~ u ~0 ~ ~ O c ~ ..0 u ~ ~ ~ C U n n m ~ ~ U ~o Q Q Q 0_ [_ t ~ Vl E A C ~ n E ~ cC ~ ~ ~ S a N S ro ~:n.3 F E rfl M ri h L ~ V LL u u - u '= 0 op ,c O E n O n.E V A ~ p `ry C -p - U 1 ~ ~ .C U ~ O = >> 7 n C 0 h S N 'L N S M u -~ u s 1 = y u~ N 0 3 3 1 u °~ 0 1 ~ ~. 3 a N S I ~0 I W 4~ ~ '~ O ~t TAI I~""1 n ~ 0 D_ U ~ o 1~!1 ~ ~J A N C 4 0 ~ U ~ C c ~ 3 ro u d o ~ ° ~ U ? ~ ~ ~ ~ ~/~ ~/~ ~ ~/~ ~ Q t; :~ 0 ~~~~y $tl~ ~~>~ 6 o~ a' O D d D -~ ~ ~ g n - _ - - Landmark Square Phase II 1 s 0 ~• L f_ ~~ ~uu ~a'w V/ t N r !4 W V d a N N 'C d f r- d 3 a L 3 W a a ~ m m B o a a~~ o> Y I °° m° - f 3 L o > cm °_ E of °~LO+°-'-° mo_oo C9 c y p ~ ~~ m y ~ pJCjU O'Y~+L a m DC a ~+ c p i m p O° ~ ..- U U> C D E ~ j 0 a ~ D N 0 Q~ C N~ O C y N m m Z°~ N°° n O m 0 ~ 7° U m N y C O F m y f C Y D °'6 D O) N O O y m O~ -° y C N m L O U ~m`o EmLO3~ ~'`oDEoo-° ~a~n ocm ~ U DL,>~ a `c° ~a3yo L O U a m L 3 m r- .~ m m m 'O y m m U p6 ~3mcma~ Ln~,oo n63m~ u o~ m p~~~ y o a 3 J o a o- .°° o ~ ~'° o m UN E~> ma°D - ~n-'~mm~ OS mLU `°Ea~-gym SDCLOmho~y~ a °-' m~ coD° h m='m ~nYE N y C > ~ c y- c O O p D ppoo o~Eo°n°°`- pQ'am°'oo`oa=° m-a~"' rg~tmmm~ cE-~xc"~Emmo ~~OL LO~; ~~O~ (~ ~~pDbDCDU m z ~ ~ p` m N ~ ~° - «O p ~ ~ N B ~ ~ ~ m ~ m > ~ 3 ° -3~ z a°oty~N~ ~ y°°~3=oEoca V O O U _N O C Oi'O ~ U m T 'O O 'U L O C O° L oy~° 5 ESm~°B°D u~i `o~~~ym °~m°' ,~ ~ 3 ~cc v >E m oa c ~mmamc o mEo.6 a moo°m`>'x~ mo~'o~a3c?QC_ U ~'cy° 3 ~EEo°~a°~mo o ~occLi?L,oQO~o C9 CU9 C ,o N T 2 2 ~'I « ~~ ~~ LL _~ .~: . -C ~- - ce~ :-r U _U C9 'C N c= N C `m ~ c LL C'J J U ~ ~ ~ E a a~Ha°on°conEo o.r~mm~om>o ~ O O ~ O V c 0° c~ _L a N t ~~- a m m 3cOO-oomoNo~ 0 otOZa;o°E~ o--c~~aocm~m~~ oomyDm~En.za 0 o E c c m 3 o E a m U 0 °~ O j ~~ m p DE~yyYEU v' °a`o~°-'om'OOC° oa~m am QN C cU UD pv~ m m U O m o m D m m m 0 .: O> C U O D D~ ~ ~ L n a m 0~ y O C~ O Z U~ U m - ~ °'j °~ Q S C O~~ Q - O y'° ° d c m o O ~ C°~ U Y+ LL U c~aOC O y a~.o ma 'n~3r°no°y~°-° LU~°cm"'o°~°O-°~„o ~~~ m D ~° c° U y~ 0 „I LE~.o=ymo=°'=o i LL c m ~mz o° m c o -E~6ca~noELOo -- ~ ~ U U b V N ' W ~' W ~' U U U' U' n _ -' N W W • may ~~~ . V M Q C n .N =O C C ti 4 h-~ H W ~o ~U v~ F, ~z ~o ~~ Q z O . ,-~ CO by . ,~ ,. .~ m ~~ _~ ~ o ~ '~ '~ ~ O ~~ eD '~ a ~~ '~ o :, ~ N ~ ~ ~ `~ ~ 3 ~ ~. ~. ~ " o ~ ~ U .m a ~ ~. n y ~ ~3 a ~ -'' w '~ ~ 0 ~ aQi ~ a n . c. ' ~ 3 ~ ~ ~ ~ ~ DD ~ C 'm H O 7I Existing Access Location to Landmark 7 ~' ~ ~ ~, ~,;,~a* ~ 'i ~r= ®y ~ . ,~ i --~. ~~ _:~. ~, Current Conditions- House at Corner Residential area on West side of Locust Street G View from Development Across Third Street ..:».`_a -a.. ~~ ~~~~ a ~'fiV Ls _ = t'~-fir' ~~,~_~.. View' from Development Across Third Street View from Development .Across Third Street l ~ (~ ~ - I a~ ,I,. +f, 1 r ~ L~ =-~. 7 Area Public Parkine Arailabiliti - _,~ ~ ~ .. ,~ ~„~`~ ~, ~ `~'' ~~ ~~:~ .. _- k --~•-s . ~ '.~.'_ •. :.~~ . -, J Vie~~ from Adjacent Propertq to East of Site ~ +: ~>~ , i r ~ ,~ 'n„r Garaee Located ~-within Parking Area. r~ _ 3 F 3y ~'~~~L ,.Y ;~ ~,~ _.. u , 4 I,y l ~:' n } ,~YC ~~; i Y ~ 1 'R'. M1r TT ~ r ~ L' ~.- Barriers obstructive drive access to adjacent propet~ ~~l.`~~ ~' _ ~~ ~~_ -~ ~ ~ t `~' ._< Council Agenda: June 8, 2009 5F. Consideration of a donation of $325 from Cargill Kitchen Solutions for Flowers on Broadway and $100 from Goldberg Bonding for National Night Out.. (TK) A. REFERENCE AND BACKGROUND: The City has received donations of $325.00 from Cargill Kitchen Solutions to be used to help defray the cost of planting flowers along Broadway. The City has also received a contribution from Goldberg Bonding in the amount of $100 to defray costs related to National Night Out. As required by state statute, if the City accepts the donation of funds, the City Council needs to adopt a resolution specifying the amount of the donation and its use. B. ALTERNATIVE ACTIONS: 1. Approve the contribution and authorize use of funds as specified. 2. Do not approve the contributions and return the funds to the donors. C. STAFF RECOMMENDATION: Staff recommendation is to adopt the resolution accepting the contributions. D. SUPPORTING DATA: Resolution No. 2009-34 City of Monticello RESOLUTION N0.2009-34 RESOLUTION APPROVING CONTRIBUTIONS WHEREAS, the City of Monticello is generally authorized to accept contributions of real and personal property pursuant to Minnesota Statutes Sections 465.03 and 465.04 for the benefit of its citizens and is specifically authorized to maintain such property for the benefit of its citizens in accordance with the terms prescribed by the donor. Said gifts maybe limited under provisions of MN Statutes Section 471.895. WHEREAS, the following persons and or entities have offered to contribute contributions or gifts to the City as listed: DONOR/ENTITY DESCRIPTION VALUE Goldber Bondin Cash $100.00 Parker McDonald (Linda Smith) Scul tore $3,000.00 Dean Rasmussen -Glass Hut Windows $1,195.00 Car ill Kitchen Solutions Cash $325.00 WHEREAS, all said contributions are intended to aid the City in establishing facilities, operations or programs within the city's jurisdiction either alone or in cooperation with others, as allowed by law; and WHEREAS, the City Council hereby finds that it is appropriate to accept the contributions offered. NOW THEREFORE BE IT RESOLVED by the City Council of Monticello as follows: 1. The contributions described above are hereby accepted by the City of Monticello. 2. The contributions described above will be used as designated by the donor. This may entail reimbursing or allocating the money to another entity that will utilize the funds for the following stated purpose: DONOR/ENTITY RECIPIENT PURPOSE Goldber Bonding MCC - City of Monticello National Ni ht Out Parker McDonald (Linda Smith) Parks De t - Ci of Monticello Otter Creek Park -honorarium Dean Rasmussen -Glass Hut DMV Office Windows for office Car ill Kitchen Solutions City of Monticello Flowers on Broadway Adopted by the City Council of Monticello this 8th day of June , 2009. Mayor ATTEST: Jeff O'Neill, City Administrator contributions resolution 060809.doc: 6/4/2009 Council Agenda: 6/9/08 5G. Consideration of approvinL the 2008 Storm Water Pollution Prevention Program (SWPPP) Annual Report. (B.W.) A. REFERENCE AND BACKGROUND: In 2005 the City of Monticello was designated as a regulated small municipal separate storm sewer system (MS4) under Minnesota Rules, Chapter 7090. This required us to obtain a National Pollutant Discharge Elimination System/State Disposal System (NPDES/SDS) storm water permit, and to develop and implement a Storm Water Pollution Prevention Program (SWPPP) to reduce the discharge of pollutants and sediments from our storm sewer system to the maximum extent practicable. On February 15, 2007 we submitted our draft SWPPP to the Minnesota Pollution Control Agency (MPCA) for review and approval. On March 24, 2008 our draft SWPPP was approved by the MPCA and we were granted general permit coverage. Our SWPPP addresses 6 minimum control measures (MCM's) including public education and outreach; public participation/involvement; illicit discharge, detection and elimination; construction site runoff control; post-construction site runoff control; and pollution prevention/good housekeeping. A total of 39 best management practices and measurable goals associated with the 6 MCM's are identified in the SWPPP for implementation. Each year by June 30th an annual report summarizing all of our SWPPP implementation efforts over the previous calendar year must be submitted to the MPCA. A draft of our 2008 Annual Report is therefore attached as supporting documentation for the Council to review and approve prior to submitting to the MPCA by June 30th. Council will note that under MCM 6 it was noted that staff was not able to inspect 20% of our outfalls and structural pollution control devices as defined in our SWPPP but staff anticipates catching up on these inspections by the end of 2009. A.1 Budget Impact: Completing the 2008 Annual Report had no direct impact to the budget. A.2 Staff Workload: Staff spent approximately 72 hours preparing the 2008 Annual Report, including preparation of all associated documentation. B. ALTERNATIVE ACTIONS: 1. Motion to approve the 2008 SWPPP Annual Report and authorize submittal of the report to the Minnesota Pollution Control Agency. 2. Motion to deny approval of the 2008 SWPPP Annual Report at this time. C. STAFF RECOMMENDATION: City staff recommends approving Alternative Action No. 1. Council Agenda: 6/9/08 D. SUPPORTING DATA: Draft 2008 SWPPP Annual Report City Ordinance Title 10, Chapter 33 USE OF THIS FORM IS MANDATORY By completing this Annual Report form, you are pr,~~-idit-ig the Minnesota Pollution Control Agency (MPCA} with a summary of your status of compliance with permit conditions, including an assessment of the appropriateness of your identified best management practices (BMPs} anti ~r~gress towards achieving your identified measurable goals for each of the minimum control measures as required bf the ~~154 Permit. If an MS4 determines that program status or compliance with the permit can not be adequately rei?lccted within the structure of this form additional explanation and/or information maybe referenced in an attachment. This crrn has sigria~cant limitations and provides only a snap shot of MS4 compliance with the conditions in the Permit. Afce.~ reviewing t;1F. information MPCA staff may need to contact the MS4 to clarify or seek additional info; .iatio-~. MPCA enforcement ~~~~1ics= is to provide the opportunity to respond to any alleged violations before any enforcement action is taken. Submit your annual report by June 30, 2009 to: Minnesota Pollution Ci~ntrai Agency Municipal Division 520 Lafayette Road North St. Paul, MN SS15S-4194 This Annual Report maybe submitted electronically vr.a email to the MPCA MS4 Frc~gram mailbox: ms4permit cr~pca.state.mn.us. If submitting electroniv~~? ly, tl~~rs farm must be sent via em2;l from the person that is duly authorized to sign this form under the Owner/Op;:ritor Certihcatirsn section. A confirmation email will be sent in response to electronic submissions. If you would like to obtain an electz~riic copy of the MS4 Annual Report for 2008 form, please visit: www.pca.state.mn.us/water/stormwate~/7tormR~tter-ms4.htdnx. If you have further questions, please contact one of these MPCA staff memb~:rs (call toll-free 800-657-3864}. Note new numbers effective November 2008: • Keith Chenyholmes SSl-7S7-270 • Joyce Cieluch 218-846-73~{7 • Scott Fox 651-757-2363 • Amy Garcia 6S1-7S7-2377 M~~,it1~a~tGontrol_Measure_1 ~u~~ t=du~at4o~a~dOu~reach~U,Gf1~'~~:_~, '`'~~`~~~~~~ `$ Monticello City g1S1+ Name of MS4 ~rLCe ~.'estby _ _ Name of C:cantact Person 763-295-2?11 brute westhv~c~ montirelln mn „G Telephone (inducing area code) Email Address 505 Walnut Street Suite 1 Mailing Address Monticello _ _ MK 55362 City State ZIP code A. The permit requires each MS4 to implement a public education program to distribute educational materials to the ctrEnm~,nity or conduct equivalent outreach activities about the impacts of stormwater discharges on water bodies and steps that the public can take to reduce pollutants in stormwater runoff. [Part V.G.1.a] NOTE: Please indicate which of the following distribution methods you used during the 2008 calendar year. Indicate the number distributed in the spaces provided (enter "0" if the method was not used or "NA" if the data does not exist):: wq-strm406 Page 1 of 7 12/08 Media type Number of media Number of times published Circulation/Audience Example: Brochures: 3 d~erent brochures published S times about 10, 000 Brochures: 6 different brochures va a e a e y 30/estimate Newsletter: 0 Posters: 0 Newspaper articles: 0 Utility bill inserts: 0 _ Radio ads: 0 Television ads: 0 ._. Cable Access Channel: 0 Other: 0 f you use a stormwater Web site as a tool to distribute stormwater educational I~~cteriais: atiStheURL: hCtD://www.ci.motiticiello.mn.us/index asp?Type=B_BASIC&SEC=•~94A52C74-~1A30-~~. ~" ow many hits to the stormwater page during 2008: lb2 4003-87B2-5CCE8C3D3A~9} id you hold stormwater related events, presentations to schools or other suer activici:.s ~] Yes ®No yes, please describe: B. What stage of development would you assign to each area of your stormwater e4~.i~:ation ~::`~gram? (If there are multiple components for a Minimum Control Measure (MCI+,~I) ;:heck the one box that most ~c:cti:rately reflects the overall stage for that MCM). You may include an attachment if norther e~;~Icnation is desired. MCM 1: ^ Not started ^ Research [j Development ~ Ir~,rhr: Implementation ^ Program in place MCM 2: ^ Not started ^ Research ^ Development ^ early Impi.n~entation ®Program in place MCM 3: ^ Not started ^ Research ®Development ^ Eazly Ir.~piementation ^ Program in place ' MCM 4: ^ Not started ^ R ese~;rch ^ Development ®Eazly Implementation ^ Program in place MCM 5: ^ Nat started ^ Research ^ Development ®Early Implementation ^ Program in place MCM 6: ^ Not started ^ Research ^ Development ~;1/azly Implementation ^ Program in place C. Have you developed pa?-tnerslzips with otkaer ~i ~4s, watersl~eci districts, local or state governments, ^ Yes Q N educational institutions, etc. to assist ,yat: in fulfilling the requirements for Minimum Control Measure 1 ? D. List those entities writl~ v,~hich you have a partnership to meet the requirements of this MCM and describe the 7iature of the a;reement(s) (list if ]~uel of effort exceeded 10 hours): N A t~""i"~i Y~Yttt ~? 3 ~] ~ 41~~5 ~~~~~..~~yy %~ `` TF'~iv<t Y~Y :tA~ ~ }r, Sy"xh! yf~}.yrT~ { ~R~ 1~Ch~'J~~ ~ •.~1''£'i' . ~ ~ -'V ~ .... ~[.~_:'. } 'C. T+%P~t~S ~p 'Y~^`.~ ~ .4eY$Y fVC ~°. TY.~luY~£K"», T. .. }'~' -\ ~sY- l49?.~, inimwm.G4li~ro,1 . easuP~g~II.~,Parfi~~ `~t14r`~/Involv~ment.:. ~r ~`~:~~~:~~<,~,~; ~./ _ Y ,c..:.~y i+,' ~ %~ ~ . . . Did you hold a public meeting to present accomplishments for calendar year 2008 and to discuss ®Yes ^ N your Stormwater Pollutic~r~ Prevention Program (SWPPP)? [Part V.G.l.e] If no, explain: What was the date of tl:~ public meeting? 5 6 09 C. How many citizens attended specifically for stormwater (excluding boardlcouncil members and staff/hired consultants)? ~_ . Was the public meeting astand-alone meeting for stormwater or was it combined with some other ®Stand-alone function such as a City Council meeting? ^ Combined Each MS4 must receive and consider input from the public prior to submittal of your annual report. ^ Yes X^ N Did you receive written and/or oral input on your SWPPP? [Part V.G.2.b.1-3]. wq-strm4-06 Page 2 of 7 12!08 F. Have you revised your SWPPP in response to comments received from the public in calendar year ^ Yes ® N 2408 or early 2009 (if meeting held in 2009)? [Part V.G.2.c] If yes, describe. Attach a separate sheet if necessary: mttnum ion tra ;M ~ ~~ 1 easur 3 Iltlctt Qischarg~ ~etectipn`and Elmtnafiion [VG 3] ~ ' ~ ~ g ~ ~ ~*~~ -~~ , . , „ - , ~, , s $' .hR .' elS... he permit requires MS4s to develop, implement and enforce a program to detect and eliminate illicit discharges as efined in 40 CFR 122.26{b)(2) in your SWPPP. You must also select and implement a program of ,~pprol:~rzate Blv1Ps and easurable goals for this nvnimum control measure. . Have you completed a storm sewer system map in accordance with the requirements of tl~.e pentzi±? ®Yes ^N (MPCA assumes that completed maps will still need updates and corrections as changes occur). If yes, describe the farm in which the map is available: ^ Hardcopy only [,X' GIS system ^ CAD ^ Other system: __ If no, please explain: NOTE: The storm sewer system map was to be completed by June 3C~, 2008. [Part V.G.3.a] . Has an ordinance or other regulatory mechanism been adopted to prohibit illicit dirse?~arges or other ^ Yes ® N non-stormwater discharges from entering your system? Provide the date for th~~ .Host relevant part of the regulatory mechanism that was adopted or estimated date of adoption: _ _ C. Have you completed the tasks associated with the schedule listed on BMP Summr::~ Sheet -rc-1 in ^ Yes ~ N your program for illicit discharge detection and elirrlin2tion? (attach additional infor7~lat:ion if needed) Indicate the status of development for tasks associates with BMP Si~cn:xzary Sheet 3c-l: ^ Not started ^ Research ®Development ^ Iml~iementatic3n ^ Pro+:~ ~7m in place . Have you completed the tasks assc,c fated with the schedule fisted on BMP Summary Sheet 3d-1 for ^ Yes ® N your Public and Employee Illicit. Discharge Information ProL,~ am? Indicate the status of devel~,pznent for tasks associated with B,,^4I1' Summary Sheet 3d-1: ^ Not started ^ Res~,:.rcl~ ^X Developn.en9: ^ Implementation ^ Program in place ,y -~ ~.. ~ T S ,C ! .7~ 'mil ~ff lr- finitr~~rq ~~r~{rol MeasurQ 4 Cony#ruc#ion Sda Stormwater ~u~o£~ Con#r ~V ~ G~4~ - k 4 ~2 1 ~ ~3iSi LRz'. ~ . ~ . ~ ~ ; Q . ti.,~ ~:~ : ~~~; The permit requires that each. l~IS4 develop. amplent, and enforce a program to reduce pollutants in any stormwater runoff to your small :":TS4 from cuzl~'~'uctian activities within your jurisdiction that result in a land disturhanc~; of equal to or greater titan one acre, including the disturbance of less than one acre of total land area that is part of a larger common plan of de vclopment or sale if the larger common plan will ultimately disturb one or more acres {include if yo~:r MS4 established a ,mailer site size}. [Part V.G.4.] Have you adopted ?n ordinance or other regulatory mechanism that regulates stormwater runoff fro Q Yes ^ No construction activiti~~~~a that results in a land disturbance of greater than or equal to one acre and/or les than one acre that is part or a common plan of development or sale that will ultimately disturb on acre or more? NOTE; Your regulatory mechanism must be fully developed and implemented wit ' six months from the extension of pem~it coverage. . A complete copy of your erosion and sediment control ordinance or other regulatory mechanism x^ Yes ^ No addressing the requirements of Part V.G.4 of the Permit must be submitted with this Annual Report. This documentation may be submitted in hard copy, as a separate electronic file, ar electronically attached to this Annual Report. Have you submitted a copy of your erosion and sediment control ordinance or other regulatory mechanism? Check here if you have No Regulatory Authority ^ wq-strm4-06 Page 3 of 7 12/08 C. The following are among the criteria used to evaluate the effectiveness of this program. Which of the following BMP components and pollution prevention management measures have been incorporated into your regulatory mechanism? Check all that apply and include a citation for each checked measure outlining specifically where it can be located in the documents submitted with this Annual Report. If you are utilizing the "Other Regulatory Mechanism" option, please respond in the same manner and follow the above submittal procedures. Citation (Ordinance, Rule, Statute, Cade, MOU, or other official agreement, page #, paragraph, lime item, or other B}YIP Component/P2 Measure reference) ~X Temporary erosion controls 33-4 : 3 ®Record keeping for rainfall and inspections 33-6 : B ®Permanent erosion controls 33-S:D ®Waste controls for hazardous waste 33_5 . C : 2 ®Waste controls for solid waste 33-5 : C : 1 ^ Dewatering and basin draining © Regular inspections by site operators 33-6 : B ©Site plan submittal including erosion and sediment 33-4 : A control BMPs ® BMP maintenance 3 3 - 7 : A -_ _ _... ® Site plan review and approval prior to activity on sit.; 33-3 :; ®Permanent stormwater management facility approval -, 3 3 -3 : B , C , D _ = _ ^ Other: .Your ordinance or regulatory mechanism m+ist include sancti~~ns ±~ ensure compliance and contain enforcement mechanisms. Which of the following enforc~;ment mechanisri-~ are contained in your ordinance or regulatory mechanism? Check all e~i~Cri~ and added ,anc,;tians for 200. irlclude with each checked measure a citation outlining where each mechanism can be i~;cated iri tlxe docul:~enL, s~:iirmitted with this Annual Report. Citation (Ordinance, Rule, Statute, Cade, MOU, or other official agreement, page #, paragraph, line item, or other Enfvrcerner~t t~Iechanisr~~ reference __ _----.. ^ Verbal warnings ® Written earnings 33-9: [A-D] ®Stop-work orders 33_9: [A-D ® Fines 33-9: jA-D] ©Forfeit of security bend moircy 33-9: jA-D] ^ Withholding of certificate of occupancy Revocat:, on "d gra Ong perm r]R Other: '~ nn o ~ m g e r . 33-9 ; [ -D ] . Identify which of the following types of enforcement actions you used for construction activities during the reporting period, indicate the number of actions or note those for which you do not have authority: Number of action ^ Yes Notice of violation # 0 No Authority wq-strm4-06 Page 4 of 7 12/08 ^ Yes Administrative fines # No Authority ^ Yes Stop Work Orders # 0 No Authority ^ ^ Yes Civil penalties # 0 No Authority ^ ^ Yes Crmunal actions # 0 No Authority ^ Yes Administrative orders # 0 No Authority Does your regulatory mechanism address the regulation of construction sites which disturb less than ~3 Yes ^ No one acre? ff yes please cite whexe this is addressed in the documen#s submitted with the Annual l~.eport 33 3 . A G. How many construction sites were inspected for compliance with your erosic~a rind sediment contro ~ Z regulatory mechanism during the 2008 calendar year ----- . On average, how many times each, or with what frequency, a.r,:, construction sites inspecte Meekly (e.g., weekly, monthly, etc.)? Do you prioritize certain construction sites for more frequent inspections :' - ~ Yes ^ No If yes, based on what criteria?past compliance issues, topography, soil type, etc. M~ tntn {~tFm Can of If11~as a 5~P_ ost ~'o`~sf~ ~~io~ ~a~v~~tel~r~M~ 2t me $ t, ~~~ ~ ~ ~~~~~~y~ ` , .~ I!f~~'~@ O BDt ~r G .r7 '""aL~ ~ ~,~~~ ~' ~ ~ a ~' a- ' •y '~_ ~ j ~~s~° -t'~- ~ }~~ s ~„ ~z ~ r~. k {.s' ~. 9 ,G ~ ~ ' ,a s'~}~ ~ ' i' ~ f~' ~ ~ }` % . . ; . ~ ~f ~~ .a^r .i , ~ a f,:r,.., .... .r, rs. ,t. . . . ~ . .. a ~-c., .. .i°~?S r~3= , ._-x'="r ~ ` he permit requires each MS4 to develop, implement, ~~nd enforce a program to address stormwater runoff from n development and redevelopment projects within your jurisdiction, that distur~~ ~.~.~ area greater than or equal to one acre including projects less than one acre that are part of a larger cor<<mon plan ~~ ~.levelopment or sale that discharge into yo small MS4. Your program must ensure that controls are in place that would~prevent or reduce water quality impacts. Yo must also select and implement a program of appropriate BMl's and measurable goals for this minimum control measure NOTE: The MS4 permit requirements associated with this mir~mur~~ ontrol measure were required to be fully develop ' and lemented b June 30, 2t)U8. . Have you developed any? imp,ornented stc<zf ~gi es which include requirements for a combination of ®Yes ^ No structural and/or non-structural L~1+rtPs ai~propriate for youz• community? . Is an ordinance or other regulatory n~~;chanism currently in place to address post-construction ®Yes ^ No runoff from ne:tiv develop~~ent and redevelopment projects to the extent allowable under taw? Provide thy; date the regulator~r mechanssmr~ ~=r;~~: ado ted or estimated date of ado Lion; b~, C. Is a pl<ii~ in place to ensure adequate long-t,;rm operation and maintenance of BMPs installed as a Q Yes ^ No result of these requirements? . Haw are you handing the long-tez~~n operation and maintenance of your stormwater management system? {Check all that apply) ^ Grants ^ Stormwater utility fce ® Taxes ^ Other: ~~'~ 4~,~Y-s^'~~~'~~ ,}rr ~'.i~ ~~ ,. 3 '~ _x,,.y,7t ~ ~ g.. - rltiz~Y4_.i. ai~c ..,; .t.-,d fit- ''~""cc' ~'v'~~.~~'''~+ - :~ ~ f~ azi'..~~:: ~ ~ . ~ ~~ d. r ._ '„ ''~ 'x~ u° },,,,._ fai e~` 1. ~"' ~ as oY ."K x n?...~"T"sd' ~aL"'#f.., '~`~' x~ ~ ~L~.-,~'u~f'.e.'~4 •~~'`.{=+sa~l.-b`. . ~ ~. {Vlirn~~ij ~b t~dl ~easur~ 6' PQ11~f~0~ P~e've i~ ~Hou~"~~cee` in ~ I~ a~~ t~G~~ '` ~~ ~ M ~ t t J QC; C~~ ~t ~ p~1r~~l~~ a~=~t ~ff~-,~, ..y,~ ~ .f~;:.~ , ~~°.-~ a +~ ~- ~~~ y~ 4 .~ ~,. ~ _ ~~ ~~ . ~,.... i` i y `Y ~ ~ .. ~^$ !~ {'kY' y ~ ..~ ~y.~' ) 1\ aY ~.~,~ "~{ {~i ~:i ~~ X r"*Y.C1.'.::R~ sl P.ilT,.....:. ~ .. :~~ ..~:5^Y.. _. t 0 L',~]C.'~~ ~ .' 'M ~^I ~ _! '~ 1 ~` ~a 1 C ~'X' ' ~ :~i* i c' Y~ ?'r _.- . .. . _. . .. S ~ re wq-strm4-06 Page 5 of 7 12/08 he permit requires each MS4 to develop and implement an operation and maintenance program that includes a trainiY omponent and has the ultimate goal of preventing or reducing pollutant runoff from municipal operations. Your progr ust include employee training to prevent and reduce stormwater pollution from activities such as park and open spac aintenance, fleet and building maintenance, new construction and land disturbances, and stormwater system maintenance. . Is your MS4 current on development of all the BMPs listed in the BMP Summary Sheets for MCM X^ yes ^ No 6 as indicated in the timeline/implementation schedules? If no, explain: . Indicate the total number of structural pollution control devices (for example-grit chambers, sump: ,, l~l~ eatable skimmers, etc) within your MS4, how many were inspected, and calculate the percent inspected. Enter "0"` if your ~~tS4 does not contain structural pollution control devices or "NA" if the data does not exist; Total Number Number Inspected _ Pe~~centagc Structural Pollution Control Devices: 43 4 9~ . Did you repair, replace, or maintain any structural pollution control devices? _^ `y'es ^ No . For each BMP below, indicate the total number within your MS4, how mart; of each BMP type were inspected, and calculate the percent inspected; Structure/Facility Type Total Number Numher~ Inspected Percentage Outfalls to receiving waters 252 t~! j p Sediment basins/ponds 101 __ 0 0 * TOTAL 353 0 0 ~* Our city plans to incorporate last year. Lapse into the next couple of years. ~.,r,~ --------r-- Sec#ion 7 ~~~aire Waters Retry ~i }-~ <x~ ~~ ~,~A ~ ~ 3: 1 ~. ~,~~~ ,r ~~.- .~ ~ y~~~~a~.~?~~ ~~ >~<: ~~. '' 4 ^ y c_S~.f a ^ 3.. i Z~~ ?+ ~2~'~ r ' ~ ~ "' ~~ t~ `~f ~ ~ wa a~ '. < E _; 't .. ... _6 3. ~ + .... .....SxS'S. c i4 ,...: ;..-..........,. . w~ ~n +u~. °'c^ZLL~~ ~ he permit requires that any MS4 that discharges to a Wat~;r of the State whiz:t~ appears on the current U.S. EPA approve ist of impaired waters under Section 303(d) of the Clean %~%ater Act review whether changes to your SWPPP may b arranted to reduce the impact of yo~~ discharge [Part N.D] . MPCA has provided an MSS tYlapping tool •,.vhieh provides infcrruation for compliance with the permit and water quality es. It can also help MS4 stale and stakehold~~~ s view relationshi,~s between an MS4 and various other water features in the ayers including impaired waters. 1',ease go ~.~ trie IviJ~ 1~lrping tool located at t a/www. ca.state.mn.us/water/star~T~u~ <a`er/stormwater-ms4.htrn1 by clicking on "MS4 mapping tool" under "Maps of S4s" and rate this weh mapping tool f~,r its usefulness in helping you identify impaired waterbodies your MS4 may ischarge to, inc?~H4>ing impa=re~1 waters as dcfined on the 303d listing (This request is optional} ^ Not Usefiil at all ^ Somew~~~~t Useful [, j d?seful ^Very Useful ®Other: No time to research Check here: =~'yourMS4 has no ir:~zaaired waters.' ^x dditional Comirtents vn tl~e MS4 ~+~Iapping Tool can be emailed to: pauLleegard@pcastate.mn.us ';}r cJ''"e. ~ s~Ye ~iKi .it~l~ ~ . _.. z-.`.'r ~ ~ "r1v ~`'4 i'z-s~. m i'-a~.5~ *.~-.-m ou >a x .S' ° ~' -_.. ., ~. 5 , t ~, ~ ,~3w ~ ~=3~'-f~ ~t~~3Cs~ ~u. ~?`^F; rri~k~'a'~d .,~"~~ro, v, ~~ r 9ra°.f[ ~1~Y ectioni~ Adtrttional .~il~[~P~., '`. z v ~~n: ~~~11e5 ~ i~_ ~ `S ~3a ri ~3'ytT~~ ~~a {d•~ y , ..., .Did you make a change to any identified BMPs or measurable goals in your SWPPP since your last ^ Yes ® N report? [Part V.H.] If yes, explain: . Briefly list the BMPs using their unique SWPPP identification numbers you have changed in your SWPPP or any measurable goals that will be changed in your updated SWPPP, and why they have changed: (Attach a separate sheet necessary) N A C. Did you rely on any other entities {MS4s, consultants or contractors) to implement any portion of ^ Yes ® N wq-strm4-06 Page 6 of 7 12/08 your SWPPP? Ifyes, please identify them and list activities they assisted with: he person with overall administrative responsibility for SWPPP implementation must sign the annual report. This perso ust be duly authorized and should be the person who signed the MS4 permit application or a successor. certify under penalty of law that this document and all attachments were prepared under my direr?i;gin or supervision ' accordance with a system designed to assure that qualified personnel properly gathered and ez~<~1uat~~~ the informatio ubmitted. Based on my inquiry of the person or persons who manage the system, or those perso:~s directly responsible fo athering the information, the information submitted is, to the best of my knowledge and belie;; ~~•.~e, accurate, and complet (Minn. R. 7001.0070). I am aware that there are significant penalties for submitting false int~~~~rnation, including th ossibility of fine and imprisonment (Minn. R. 7001.0540). X Authorized Signature (This persofi must be duly authorized to sign the annual report for the MS4. Electronic submissions must l.~e. sent from this person's email address to qualify for Authorized Signature status) ~-~~g Uate We Bruce Cit_'ngineer Last Name First Name Title 505 W 1m~ S YPPP SniYa 1 Mailing Address Monticello Nf~T 55362 City State ~Z:11' cac<e (763)-245-2711 bruce.weerby@ci.monticello.mn.us Telephone (include area code) E-mai? Address wq-strm4-06 Page 7 of 7 12/08 CHAPTER 33 AN ORDINANCE REGULATING CONSTRUCTION AND DEVELOPMENT, REQUIRING GRADING, DRAINAGE AND EROSION PLANS, CONTROLS AND PERMITS SECTION: 33-1: Purpose 33-2: Definitions 33-3: Permits 33-4: Grading, Drainage and Erosion Control Plan Requirements 33-5: Construction Requirements 33-6: Inspection 33-7: Site Maintenance 33-8: Certification 33-9: Enforcement 33-14: Separability 33-11: Repeal of Ordinance Sections 33-1: PURPOSE During the construction process, soil is highly vulnerable to erosion by wind and water. Eroded soil endangers water resources by reducing water quality and causing the siltation of aquatic habitat for fish and other desirable species. Eroded soil also necessitates the maintenance of sewers and ditches and the dredging of lakes and ponds. As a result, the purpose of this local regulation is to safeguard persons, protect property, and prevent damage to the environment in Monticello. This ordinance will also pxomote the public welfare by guiding, regulating, and controlling the design, construction, use, and maintenance of any development or other activity that disturbs or breaks the topsoil or results in the movement of earth on land in Monticello. This ordinance is to be used in supplement to any other regulations as required by state agencies. 33-2: DEFINITIONS [AA] As-Built Plans Record drawings of approved and as constructed ixnprovements. [AB] Best Management Practices (BMPs) Erosion and sediment control and water quality management practices that are the most effective and practicable means of controlling, preventing, and m;n;m;z;ng degradation of surface water, including avoidance of impacts, construction-phasing, minimizing the length of time soil areas are exposed, prohibitions, and other management practices published by state or designated area-wide planning agencies. [AC] City Engineer A person who has received training and is given authority by the City of Monticello to design, review, authorize, approve, inspect, and maintain erosion and sediment control plans and practices. [AD] Clearing Any activity that removes the vegetative surface cover. MONTICELLO ZONING ORDINANCE 33/ 1 (AE] Conservation Easement A conservation easement is legal land. preservation agreement between a landowner and a municipality or a qualified Iand protection organization. The easement confers the transfer of usage rights from .one party to another. [AF] Construction Activity A disturbance to the land that results in a change in the topography, or the existing soil cover (both vegetative and non-vegetative). Examples of construction activity may include clearing, grading, filling and excavating. [AG] Dewatering The removal of water for construction activity. It can be a discharge of appropriated surface or groundwater to dry andlor solidify a construction site. Minnesota Department of Natural Resources permits are required to be appropriated and if contaminated may require other MPCA permits to be discharged. [AH] Erosian Control A measure that prevents erosion including but not limited to: soil stabilization practices, limited grading, mulch, temporary or permanent cover, and construction phasing. [AI] Erosion Control Inspector A designated agent given authority by the City of Monticello to inspect and maintain erosion and sediment control practices. [AJ] Final Grade Excavation or fill of material to final plan elevation. Final grade completed as part of individual site development. [AK] Final Stabilization: a. All soil disturbing activities at the site have been completed and a uniform (e.g., evenly distributed, without large bare areas} perennial vegetative cover with a minimum density of 70% of approved vegetative cover for the area has been established on all unpaved areas and areas not covered by permanent structures, or equivalent permanent stabilization measures have been employed; b. For individual lots in residential construction by either: (a) The homebuilder completing final stabilization as specified above, or (b) the homebuilder establishing temporary stabilization including perimeter controls for an individual lot prior to occupation of the home by the homeowner and information the homeowner of the need for, and benefits of, final stabilization. [AL] Grading Excavation or fill of material, including the resulting conditions thereof. [AM] Gradmg, Drainage and Erosion Control Permit A permit issued by the municipality for the construction or alteration of the ground and for the improvements and stntctures for the control of erosion, runoff, and grading. Herein after referred to as "Grading Peivut". [AN] Grading, Drainage and Erosion Control Plans A set of plans prepared by or under the direction of a licensed professional engineer. Plans are required to indicate the specific measures and sequencing to be used to control grading, sediment and erosion on MONTICELLO ZONING ORDINANCE 33/ 2 a development site during and after construction as detailed in the City of Monticello "Plan Requirements and Design Guidelines". [AO] Impervious Surface A constructed hard surface that either prevents or retards the entry of water into the soil and causes water to run off the surface in greater quantities and at an increased rate of flow than prior to development. Examples include rooftops, sidewalks, patios, driveways, parking lots, storage areas, and concrete, asphalt, or gravel roads. [AP] National Pollutant Discharge Elimination System (NPDES) The program for issuing, modifying, revoking, reissuing, terminating, monitoring, and enforcing permits under the Clean Water Act (Sections 301, 318, 402, and 405} and United States Code of Federal Regulations Title 33, Sections 1317, 1328, 1342, and 1345. [AQ] Perimeter Sediment Control A barrier that prevents sediment from leaving a site by filtering sediment-laden runoff or diverting it to . a sediment trap or basin. [AR] Permanent Cover Final site stabilization. Examples include grass, gravel, asphalt, and concrete. [AS] Permittee Applicant for and recipient of approved Grading, Drainage and Erosion Control Permit. [AT] Phasing Clearing a parcel of land in distinct phases, with the stabilization of each phase completed before the clearing of the next. [AU] Plan Requirements and Design Guidelines Manual detailing City specifications for all plan requirements. [AV] Public Waterway Any body of water, including, but not limited to lakes, ponds, rivers, streams, and bodies of water delineated by the City of Monticello or other state or federal agencies. [AW] Rough Grade Excavation or fill of material to a condition suitable for general maintenance. [AX] Sediment Control Measures and methods employed to prevent sediment from leaving the site. [AY] Site A parcel of land or a contiguous combination thereof, where grading work is performed as a single unified operation. [AZ] Site Development Construction or alteration of ground. [BA] Stabilized MONTICELLO ZONING ORDINANCE 33/ 3 The exposed ground surface has been covered by appropriate materials such as mulch, staked sod, riprap, wood fiber blanket, or other material that prevents erosion from occurring. Grass seeding is not stabilization. [BB] Standard Plates General drawings having or showing similar characteristics or qualities that are representative of a construction practice or activity. [BC] Start of Construction The first land-disturbing activity associated with a development, including land preparation such as clearing, grading, excavation and filling; [BD] Storm Water Defined under Minn. R. 7077.0105, subp. 41(b}, and includes precipitation runoff, storm water runoff, snow melt runoff, and any other surface runoff and drainage. [BE] Storm Water Pollution Prevention Program (SWPPP} A program for managing and reducing storm water discharge that includes erosion prevention measures and sediment controls that, when implemented, will decrease soil erosion on a parcel of land and decrease off-site nonpoint pollution. [BF] Surface Water or Waters All streams, lakes, ponds, marshes, wetlands, reservoirs, springs, rivers, drainage systems, waterways, watercourses, and irrigation systems whether natural or artificial, public or private. [BG] Temporary Erosion Control Methods employed to prevent erosion on a temporary basis. Examples of temporary cover include; straw, wood fiber blanket, wood chips, and erosion netting. [BF] Waterway A channel that directs surface runoff to a watercourse or to the public storm drain. [BG] Water Conveyance System Any channel that conveys surface runoff throughout the site. [BH] Wetland or Wetlands Defined in Minn. R. 7050.0130, subp. F and includes those areas that are inundated or saturated by surface water or groundwater at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for Life in saturated soil conditions. Wetlands generally include swamps, marshes, bogs, and similar areas. Constructed wetlands designed for wastewater treatment are not waters of the state. 33-3: PERMITS [A] APPROVAL: No person shall be granted a Grading, Drainage and Erosion Control Permit ("Grading Permit") for land-disturbing activity that would require the uncovering or distributing of material in excess of any of the following measurements without the approval of a Grading, Erosion and Sediment Control Plan by the City of Monticello. MONTICELLO ZONING ORDINANCE 33/ 4 1. 5000 square feet. 2. 400 cubic yards undeveloped land, or 40 cubic yards developed land. 3. Within 200 feet of a waterway or surface water(s). [B] EXCEPTION: No Grading Permit is required for land disturbances under the amounts specified above, or for the following activities: 1. Any emergency activity that is immediately necessary for the protection of life, property or natural resources. 2. General establishment of new construction Iawns, or the addition of four (4) or fewer inches of topsoil. 3. Existing nursery and agricultural operations conducted as a permitted main or accessory use. [C] APPLICATION REQUIREMENTS: 1. Each application shall bear the name(s) and address(es) of the owner or developer of the site, and of any consulting firm retained by the applicant together with the name of the applicant's principal contact at such firm 2. A filing fee and security as outlined by City ordinance and paxagraph [D] below. 3. A Grading, Drainage and Erosion Control Plan meeting the requirements of this ordinance. Each application shall include the required number of plans and other required materials as specified on the application form. 4. The application form shall include a statement by the applicant that any land clearing, construction, or development involving the movement of earth shall be in accordance with the Approved Grading, Drainage and Erosion Control Plan. 5. In the case of girding specific to and in conjunction with a single Building Permit, a separate Grading Permit is not required. The Building Permit shall be reviewed and serve as the Grading Permit. [D] SECURjTY: 1. The permittee will be required to file with the City of Monticello an irrevocable, automatically renewing letter of credit, or other improvement security in the amount specified by the current City ordinance for fee schedule. This security shall be in addition to the required non-refundable filing fee as specified by City Ordinance, which shall be submitted under separate payment. a. The security shall cover all costs of engineering and inspection, site improvements, street sweeping, repairs to erosion control measures, and maintenance of improvements for such period as specified by the City of Monticello. Said security shall be provided prior to the release of the Grading Permit. MONTICELLO ZONING ORDINANCE 33/ 5 b. Security shall be released after final stabilization is complete, erosion control measures have been removed and their removal area inspected by the City of Monticello and deemed to be approved. 2. Individual lot permittee shall be required to provide a bond or other improvement security with a building permit application. a. The security shall cover City costs for street sweeping, installation, maintenance and repairs to erosion control measures. The bond will be in an amount as specified by the current City ordinance for fee schedule. Said security shall be provided prior to the release of the Grading Pemut. b. The security shall be released after turf is established as specified in the City Design Guidelines and Plan Requirements Manual, and the turf establishment is inspected by the City of Monticello and deemed to be approved. [E} PROCEDURE: The City of Monticello will review each application for Grading Permit to determine its conformance with the provisions of this regulation and other applicable requirements. The City of Monticello requires complete application no less than fifteen (15} working days in advance of the desired Grading Permit release date. Upon complete application, the City of Monticello shall, in writing: l . Approve the permit application; 2. Approve the permit application subject to such reasonable conditions as maybe necessary to secure substantially the objectives of this regulation, and issue the permit subject to these conditions; or 3. Deny the permit application, indicating the reasons} and procedure for submitting a revised application and/or submission; 4. Appeals of denial of permit shall be processed in accordance with Appeal to the Monticello Zoning Ordinance. 33-4: GRADING, DRAINAGE AND EROSION CONTROL PLAN REQUIREMENTS [A] PLAN REQUIlZEMENTS: Grading, erosion control practices, sediment control practices, and waterway crossings shall meet the design criteria set forth in the Grading, Drainage and Erosion Control Plan, and shall be adequate to prevent transportation of sediment from the site to the satisfaction of the City of Monticello. The Grading, Drainage and Erosion Control Plan shall comply with the NPDES General Storm Water Permit requirements and include the following, as applicable: 1. A natural resources map identifying soils, tree cover including size and type, significant native plant communities, and resources protected under other chapters of this code. 2. A sequence of construction of the development site, including stripping and clearing; rough grading; construction of utilities, infrastructure, and buildings; and final grading and landscaping, Sequencing shall identify the expected date on which clearing will begin, phasing of clearing or MONTICELLO ZONING ORDINANCE 33/ 6 grading, the estimated duration of exposure of cleared areas, areas of clearing, installation of temporary erosion and sediment control measures, and establishment of permanent vegetation. 3. All erosion and sediment control measures necessary to meet the objectives of this Iocal regulation throughout all phases of construction and after completion of development of the site. Depending upon the complexity of the project, the drafting of intermediate plans maybe required at the close of each season. 4. Seeding mixtures and rates, types of sod, method of seedbed preparation, expected seeding dates, type and rate of lime and fertilizer application, and kind and quantity of mulching for both temporary and permanent vegetative control measures. Required specifications are referenced in the City of Monticello Plan Requirements and Design Guidelines. 5. Provisions for maintenance of erosion and sediment plan, specifically in boulevards, easements and other public areas, and estimates of the cost of maintenance. 6. Provisions for regular permittee inspections of all control measures in accordance with the inspection schedule outlined on the approved Grading, Drainage and Erosion Control Plan(s). 7. Modifications to the plan shall be processed and approved or disapproved in the same manner as 33- 3[E] of this regulation, may be authorized by the City of Monticello by written authorization to the permittee, and shall include: a. Major amendments to the erosion and sediment control plan submitted to the City of Monticello. b. Field modifications of a minor nature. 33-5: CONSTRUCTION REQUIREMENTS [A] CONSTRUCTION SPECIFICATIONS: 1. Grading, erosion and sediment controls as specified in the City's Plan Requirements and Design Guidelines. 2. Clearing and grading of natural resources, such as forests and wetlands, shall not be permitted, except when in compliance with all other chapters of this Code. Cleating techniques that retain natural vegetation and drainage patterns shall be recommended as necessary and used to the satisfaction of the City Engineer. 3. Clearing, except that necessary to establish sediment control devices, shall not begin until all sediment control devices have been installed and have been stabilized. 4. Phasing may be required on all sites based on site specifics, with the size of each phase to be established at plan review and as approved by the City Engineer/City of Monticello. 5. Soil stabilization shall be completed within 14 days of clearing or inactivity in construction. b. Final stabilization on all sites shall become established within 6 months. The City of Monticello may require the site to be reseeded or anon-vegetative option employed. MONTiCELLO ZONING ORDINANCE 33/ 7 7. Seeding shall be in accordance with the City's current seeding specification as detailed in the Plan Requirements and Design Guidelines. AlI seeded areas shall be fertilized, mulched, and disc anchored as necessary for seed retention. 8. Special techniques that meet the design criteria outlined in Plan Requirements and Design Guidelines shall be in place on steep slopes or in drainage ways shall be used to ensure stabilization. 9. Soil stockpiles which shall be inactive for a period of 7 or more days shall include provisions for perimeter sediment controls. The placement of soil stockpiles adjacent to public rights-of--way or waterways is prohibited. 10. The entire site must be stabilized to a minimum of 70% coverage, using a heavy mulch layer or another method that does not require germination to control erosion, at the close of the construction season. 11. Techniques shall be employed to prevent the blowing of dust or sediment from the site. 12. Techniques that divert upland runoff past disturbed slopes shall be employed. [B] WATERWAY AND WATERCOURSE PROTECTION REQUIREMENTS: The Permittee(s} shall implement the following waterway and watercourse measures on the site: 1. A temporary stream crossing installed and approved by the local government unit and regulating agency if a wet watercourse will be crossed regularly during construction. 2. Stabilization of the watercourse channel before, during, and within 24 hours after any in-channel work. 3. All on-site stormwater conveyance channels designed according to the criteria outlined in the Plan Requirements and Design Guidelines. 4. Stabilization adequate to prevent erosion located at the outlets of all pipes and paved channels. [C] POLLUTION PREVENTION MANAGEMENT MEASURES: The Permittee{s) shall implement the following pollution prevention management measures on the site: 1. Solid Waste: Collected sediment, asphalt and concrete millings, floating debris, paper, plastic, fabric, construction and demolition debris and other wastes must be disposed of properly and must comply with MPCA disposal requirements. 2. Hazardous Materials: Oil, gasoline, paint and any hazardous substances must be properly stored, including secondary containment, to prevent spills, leaks or other discharge. Restricted access to storage areas must be provided to prevent vandalism. Storage and disposal of hazardous waste must be incompliance with MPCA regulations. 3. External washing of trucks and other construction vehicles must be limited to a defined area of the site. Runoff must be contained and waste properly disposed of. No engine degreasing is allowed on site. MONTICELLO ZONING ORDINANCE 33/ 8 33-b: INSPECTION [A] NOTIFICATION: The Erosion Control Inspector shall make inspections as hereinafter required and either shall approve that portion of the work completed or shall notify the permittee wherein the work fails to comply with the Erosion and Sediment Control Plan as approved. [B] PROCIDURE: The City shalt inspect all permit sites once per week and within 24 hours after a rain event. The City shall also require inspections at other development benchmarks as follows and as applicable. To obtain inspections, the permittee shall notify the City of Monticello at least one working day before the following: 1. Installation of sediment and erosion control measures 2. Start of construction or site development 3. Close of the construction season 4. Completion of final stabilization/landscaping 5. Removal of erosion control measures 6. Final project compliance and acceptance close-out [C] MATERIAL REQUIREMENTS: Seed tags should be submitted to the Erosion Control Inspector for approval prior to commencing work. Proof of application rates should be provided. [D] PERMITEE INSPECTION: The permittee or his/her agent shall also make regular inspections of all control measures in accordance with the inspection schedule outlined on the approved Grading, Drainage and Erosion Control Plan(s). The purpose of such inspections will be to determine the overall effectiveness of the control plan and the need for additional control measures. All inspections shall be documented in written form and submitted to the City of Monticello at the time interval specified in the approved permit. [E] AUTHORIZATION: The City Engineer or Erosion Control Inspector shall enter the property of the applicant as deemed necessary to make regular inspections to ensure the validity of the reports filed under Section D. 33-7: SITE MAINTENANCE [A] RESPONSIBILITIES: Within 2A hours, the pennittee shall clean dirt and debris from streets that has resulted from construction work by the Developer, home builders, subcontractors, their agents or assigns. Prior to any construction in the plat, the Developer shall provide the City Engineer with a schedule for erosion and sediment control inspection, street cleaning, and street sweeping. [B] No development, utility or street construction will be allowed and no Building Permits will be issued unless the development is in full compliance with the requirements of this Ordinance. 33-5: CERTIFICATION [A] APPROVED GRADING, DRAINAGE AND EROSION CONTROL PLAN: Plans for grading, stripping, excavating, and filling work bearing the stamp of approval of the City Enguieer or Chief Building Official, as applicable, shall be maintained at the site during the progress of the work. [B] AS-BUILT GRADING PLAN AND DEVELOPMENT PLAN: Within thirty (3Q) days after completion of site development as per the approved Grading, Drainage and Erosion Plan, and prior to the approval of individual building pezrnits, the Developer shall provide the City with an As Built MONTICELLO ZONING ORDINANCE 33/ 9 Grading Plan and Development Plan as defined in the City of Monticello Plan Requirements and Design Guidelines. [C] PROCEDURE: The City will withhold issuance of building permits until the approved certified As- Built Grading Plan and As-Built Development Plan are on file with the City, all securities as required by this ordinance are received, conservation easement posts are installed, and all erosion control measures are in place as determined by the City Engineer. [D] REMOVAL OF EROSION CONTROL MEASURES: The above specified requirements will be authorized for removal upon the sodding of the rear yards, completion of punch list items involving ponds and slopes, final stabilization, completion of proper turf establishment and placement of the proper conservation easement posts and signs as specified. Inspection is required after the removal of erosion control measures to verify proper restoration. Please refer to City of Monticello Plan Requirements and Design Guidelines for specifications. 33-9: ENFORCEMENT [A] NOTICE OF VIOLATION 1. If the Grading pemuttee fails to meet or maintain sediment and erosion control measures per the Approved Grading, Drainage and Erosion Control Plan, the City shall issue a Notice of Violation. The Notice of Violation shall detail the default and prescribe a remedy and required schedule for compliance. [B] LAPSE AND ORDER FOR WORK 1. If the Grading permittee fails to meet or maintain sediment and erosion control measuures per the Approved Grading, Drainage and Erosion Control Plan, the City may, in its discretion, perform the work or contract to have the work completed and draw down on the security to pay any costs. 2. The City will endeavor to notify the Developer in advance of any proposed action, but failure of the City to do so will not affect the Developer's and City's rights or obligations hereunder. [C] STOP WORK ORDER/ItEVOCATION OF GRADING PERMIT. In the event that any person holding a Cnading Permit pursuant to this ordinance violates the terms of the permit or implements site development in such a manner as to materially adversely affect the health, welfare, environment, or safety of persons residing or working in the neighborhood or development site so as to be materially detrimental to the public welfare or injurious to property or improvements in the neighborhood, the City of Monticello may suspend or revoke the Grading Permit through the issuance of a stop work order or the revocation of the Grading or Building Feimit. [D] VIOLATION AND PENALTIES: No person shall construct, enlarge, alter, repair, or maintain any grading, excavation, or fill, or cause the same to be done, contrary to or in violation of any terms of this ordinance. Any person violating any of the provisions of this ordinance shall be deemed guilty of a misdemeanor and each day during which any violation of any of the provisions of this ordinance is committed, continued, or permitted, shall constitute a separate offense. MONTICELLO ZONING ORDINANCE 33/ 10 2. Upon conviction of any such violation, such person, partnership, or corporation shall be punished by a fine as specked by the City ordinance for fee schedule for each offense. In addition to any other penalty authorized by this section, any person, partnership, or corporation convicted of violating any of the provisions of this ordinance shall be required to bear the expense of such restoration. 33-10: SEPARABILITY The provisions and sections of this ordinance shall be deemed to be separable, and the invalidity of any portion of this ordinance shall not affect the validity of the remainder. 33-11: REPEAL OF ORDINANCE SECTIONS: SECTION 2. Section 3-2[E) of the Monticello Zoning Ordinance- DRAINAGE PLANS is hereby deleted. SECTION 3. Section 3-6A of the Monticello Zoning Ordinance- GRADING is hereby deleted. SECTION 4. References in the ordinance establishing fees and charges are hereby amended to reflect that Grading Permit fees shall be in an amount as indicated in the City of Monticello's Fee Schedule Ordinance. (4/14/08, #481) MONTICELLO ZONING ORDINANCE 33/ 11 Council Meeting - 06/08/2009 SH. Consideration of accepting donation from Ras Glass (formerly Glass Hut) of 2 windows 48" x 32" for Monticello DMV. (B.P.) A. BACKGROUND INFORMATION: Dean Rasmussen of Ras Glass would like to donate 2 new tempered glass windows 48" x 36"for the Monticello DMV. Dean is a longtime business owner and patron of the City of Monticello; he would like to add to the revitalization of downtown by assisting the City to improve the DMV by donating 2 windows to be installed to the west wall of the DMV. Dean feels this will add aesthetics, much light to the building and save in electrical costs, along with providing a view to observe vehicles being registered and security for patrons. The DMV has a $80,000 budget for the exterior to; stucco the entire building, replace 3 doors (two for DMV and one for the Food Shelf), and a foyer entrance to act as an air gap for the DMV. Bids to date for all other improvements are well below the budget figure and will be in the next council agenda for the respective work to be done with council approval. a. Budget Impact: Will reduce the $80,000 DMV exterior budget by $2,107.52 to create the openings and the installation of windows. b. Staff Workload Impact: none. B. ALTERNATIVES: The first alternative is to accept the donation and approve the bids for creating the openings and installation of windows. 2. The second alternative is to decline the donation offer. C. STAFF RECOMMENDATION: It is the recommendation of Staff to accept the donation and approve the bids for creating the openings and installation of windows. This minimum cost will not diminish our ability to complete other planned improvements to the DMV. D. SUPPORTING DATA: Copy of cost for frames & glass installation; Copy of bids for concrete cutting (second bid will be provided prior to the meeting). Resolution RAS GLASS, LLC vrric;t t;~rr 101 W BROADWAY ST PO. BOX 73 MONTICELLO, MN 55362-9352 F'~~,(763~ 295-3152 FAX:(763 285-3154 Federal Tax iD: 2~-c4ss3aG P/O#: Cust State Tax ID: Taken By: Cust Fed Tax ID: Quote: Q0035$4 Installer: Ship Via Date: 613/2009 SalesRep: Adv. Code__ Time: 09:OS Ph9 Bitl To: MONTICITY Sold To: MONTICiTY MONTICELLO CITY OF 608 PASCHKE 505 WALNUT STREET DMV BUILDING SUITE 1 MONTICELLO, MN 55362 763-271-3289 Qty Part Number Description _ List Disc°fo Seti Tatat 1 COMM-Sect 8810 Glas Sect 8810 Glass/Glaz COMMERCIAL $867.52 0 $867.52 $867.52 Note: 2 -FIXED WINDOWS 48 X 32 (1 3/4 X 4 1/2 DARK BRONZE FRAMING) fNSULATED LOW E GLASS MATERIAL ONLY $597 52~ "CLUB ~~ • ~.., ~~~~! r Sub Total: $867.52 Tax: $0.00 Due on recall Total: $867.52 Quality Cutting & Coring, Inc. 172 139`h Ave. N.W. Andover, MN 55304 (763) 785-9605 BID MEMORANDUM By: Rod Landrus /Robert Spolarich Cell: 763-360-4743 Revised Date: June 4, 2009 Location: Monticello Public Works Contractor: Monticello Public Works Robert Paschke Phone: 763-271-3271 Office Fax: 763-271-3272 WORK TO BE COMPLETED: SUPPORTING DATA Cut, demo, haul away debris and provide & install angles for 2 - 30" x 40" x 12" thick windows at ground level. Bid Price 1 240.00 EXCEPTIONS/TERMS & CONDITIONS: • All work to be performed is based on regular hour pricing, unless otherwise specified above. • Any variations on above dimensions will alter bid pricing. • Hourly rate starts from the time employees leave the shop until the time that they return to the shop. • General contractor is responsible for all layout of work and must be completed prior to start of job. • Quality Cutting & Coring, Inc. is not responsible for the cutting of any lines that are located in the concrete or directly below, i.e. power, phone, electrical, fuel, conduit, etc. and will not be held liable for repair of any such lines. All such lines should be sufficiently buried below grade. • All structural engineering issues will be handled solely by General Contractor. • General Contractor to provide reasonable access to work area and to minimize mobilizations and down time. • No temporary or permanent shoring or covers for openings are included. • Removal or disposal of concrete or debris is included in this proposal, unless specified above. AUTHORIZATION: By signing and dating below, I hereby authorize Quality Cutting & Coring, Inc. to complete the work indicated above, at the price(s) quoted above. I agree with all exceptions/terms & conditions. Signature Date Upon execution, please return Memorandum via facsimile to 763-767-8525. City of Monticello RESOLUTION N0.2009-34 RESOLUTION APPROVING CONTRIBUTIONS WHEREAS, the City of Monticello is generally authorized to accept contributions of real and personal property pursuant to Minnesota Statutes Sections 465.03 and 465.04 for the benefit of its citizens and is specifically authorized to maintain such property for the benefit of its citizens in accordance with the terms prescribed by the donor. Said gifts maybe limited under provisions of MN Statutes Section 471.895. WHEREAS, the following persons and or entities have offered to contribute contributions or gifts to the City as listed: DONOR/ENTITY DESCRIPTION VALUE Goldberg Bondin Cash $100.00 Parker McDonald (Linda Smith) Scul tore $3,000.00 Dean Rasmussen -Glass Hut Windows $1,195.00 Car ill Kitchen Solutions Cash $325.00 WHEREAS, all said contributions are intended to aid the City in establishing facilities, operations or programs within the city's jurisdiction either alone or in cooperation with others, as allowed by law; and WHEREAS, the City Council hereby finds that it is appropriate to accept the contributions offered. NOW THEREFORE BE IT RESOLVED by the City Council of Monticello as follows: 1. The contributions described above are hereby accepted by the City of Monticello. 2. The contributions described above will be used as designated by the donor. This may entail reimbursing or allocating the money to another entity that will utilize the funds for the following stated purpose: DONOR/ENTITY RECIPIENT PURPOSE Goldber Bondin MCC - Ci of Monticello National Ni ht Out Parker McDonald (Linda Smith) Parks De t - City of Monticello Otter Creek Park -honorarium Dean Rasmussen -Glass Hut DMV Office Windows for office Car ill Kitchen Solutions City of Monticello Flowers on Broadwa Adopted by the City Council of Monticello this 8th day of June , 2009. Mayor ATTEST: Jeff O'Neill, City Administrator contributions resolution 060809.doc: 6/4/2009 Council Agenda: 6/08/09 SI. Consideration of approving an increase in the monthly payment for services performed by the Animal Control Officer. (CS, TK) A. REFERENCE AND BACKGROUND: The City of Monticello contracts with Patty Salzwedel of Monticello Animal Control for animal control and impound facility services. The agreement calls for semi-monthly payments of $1505.08, which are paid on the 15t" and 30t" of each month for a total of $3010.16. This amount has remained the same since last approved in January of 2007. During the budget process for 2009, an increase of 2% was included in the professional services budget with the intention of seeking an increase equal to what might be approved for city employees. Services provided include: • response to animal control calls during public hours of 8 a.m. to 5 p.m. Monday through Friday • on call response for emergency calls outside of public hours, seven days a week • care of animals and impound facility twice a day seven days a week, with scheduled hours of 10 a.m. to 2 p.m. Monday through Friday (state statutes require a minimum of 4 consecutive hours per day) • assistance with impounding and care of animals from other jurisdictions that have contracted with the City of Monticello • transportation of unclaimed animals to shelters after impound period • maintain records of hours, tasks performed, intake and disposition of animals, and other required recordkeeping • preparing statements used for billing outside jurisdictions for boarding and disposition services • maintain inventory of supplies for animal care and facility operations Staff is asking Council to approve an increase of 1 % for Monticello Animal Control effective with the next check after approval by Council. We feel this is awell-deserved increase for the quality and quantity of work performed by Patty. The number and intensity of calls to animal control has increased about 25% per Patty's estimate over the last two years commensurate with the growth of the City and addition of many new housing units. Patty has worked hard to respond quickly and effectively to residents that voice concerns about barking dogs, dogs running loose, and other pet issues. She is coordinating her efforts with the Wright County Sheriff's Department so that they share information on responses to animal control calls and assist each other with problem situations. BUDGET IMPACT: The funds for the increase are included in the 2009 budget. It is projected that the total cost to the City for 2009 would be $210.70. This cost increase could also be justified in that due to increased demand for services, the cost per call for animal control services has been reduced. In other words, the City is getting even more value for the dollars it invests in animal control services and the additional investment would be well spent. Council Agenda: 6/08/09 B. ALTERNATIVE ACTIONS Approve an increase of 1 % to the payment amount for Monticello Animal Control for a total of $30.10 per month. 2. Do not approve and increase for Monticello Animal Control at this time. C. STAFF RECOMMENDATION: City Staff supports a 1 % increase in the monthly payment for animal control services and care of the impound facility performed by Patty Salzwedel of Monticello Animal Control. Patty has proven that she deserves this increase with quick response time, good rapport with the public, understanding and application of the city ordinances, coordination with Wright County Sheriff Department, and overall satisfaction with her handling of adverse situations. City staff will be reviewing the contracts for animal control service for Monticello and care of the impound facility this fall in advance of contract approval for 2010. We will be working with the Police Advisory Commission and Monticello Animal Control prior to presenting to Council for approval. D. SUPPORTING DATA: None Council Agenda- 06/08/2009 SJ. Consideration of accepting donation of a metal sculpture from Linda Smith in remembrance of John Komarek. (B.P.) A. BACKGROUND INFORMATION: John Komarek was a developer for the Prairie West Addition, which is adjacent to Otter Creek Park. Linda Smith would like to donate a metal sculpture created by Parker McDonald in John's memory. The sculpture is of an Otter seated on a bicycle with hands and feet in the air and a big grin; the bicycle in the sculpture was actually owned by John Komarek. The front corner of Otter Creek Park also was owned by John Komarek and is the location where Linda Smith would like the sculpture to be placed. At the entrance of the park there is a flower garden; Parker McDonald will install the sculpture in the center of the garden situated to welcome guests to the park. Parker McDonald hopes for council approval so that he may have this gift in place for the 2009 Walk `n' Roll event. a. Budget Impact: none b. Staff Workload Impact: none B. ALTERNATIVES: The first alternative to accept the donation and location of the sculpture. 2. The second alternative to decline the donation offer. C. STAFF RECOMMENDATION: It is the recommendation of Staff to accept the donation and location of the sculpture. D. SUPPORTING DATA: Photos of Sculpture. Resolution City of Monticello RESOLUTION N0.2009-34 RESOLUTION APPROVING CONTRIBUTIONS WHEREAS, the City of Monticello is generally authorized to accept contributions of real and personal property pursuant to Minnesota Statutes Sections 465.03 and 465.04 for the benefit of its citizens and is specifically authorized to maintain such property for the benefit of its citizens in accordance with the terms prescribed by the donor. Said gifts maybe limited under provisions of MN Statutes Section 471.895. WHEREAS, the following persons and or entities have offered to contribute contributions or gifts to the City as listed: DONOR/ENTITY DESCRIPTION VALUE Goldber Bonding Cash $100.00 Parker McDonald (Linda Smith) Scul tore $3,000.00 Dean Rasmussen- Glass Hut Windows $1,195.00 Cargill Kitchen Solutions Cash $325.00 WHEREAS, all said contributions are intended to aid the City in establishing facilities, operations or programs within the city's jurisdiction either alone or in cooperation with others, as allowed by law; and WHEREAS, the City Council hereby finds that it is appropriate to accept the contributions offered. NOW THEREFORE BE IT RESOLVED by the City Council of Monticello as follows: 1. The contributions described above are hereby accepted by the City of Monticello. 2. The contributions described above will be used as designated by the donor. This may entail reimbursing or allocating the money to another entity that will utilize the funds for the following stated purpose: DONOR/ENTITY RECIPIENT PURPOSE Goldber Bonding MCC -City of Monticello National Ni ht Out Parker McDonald (Linda Smith) Parks De t - Cit of Monticello Otter Creek Park -honorarium Dean Rasmussen -Glass Hut DMV Office Windows for office Car ill Kitchen Solutions Cit of Monticello Flowers on Broadway Adopted by the City Council of Monticello this 8th day of June , 2009. ATTEST: Mayor Jeff O'Neill, City Administrator contributions resolution 060809.doc: 6/4/2009 Donated Sculpture [SUPPORTING DATA In Memory of John Komarek Council Agenda: June 8, 2009 7. Consideration of Accepting 2008 Audit Report. (TK) A. REFERENCE AND BACKGROUND: The City is required to have an annual audit of its financial statements. The audit firm of Malloy, Montague, Karnowski, Radosevich & Co., P.A. (MMKR) conducted the audit, which is the second year for the firm auditing the City. The City's senior accountant, Karri Thorsten, coordinated the audit with finance staff to provide MMKR with the various worksheets and accounting ledgers to complete the audit in an efficient and timely manor. The audit finds for 2008 were much more favorable and less severe than the findings in 2007. The audit process was smoother and than last year with less problems. MMKR's cost to complete the audit for 2008 was $35,500 which is less than the $43,375 the City paid for the 2007 audit and the $43,200 the City paid for the 2006 audit from the previous firm. Jim Eichten, Principal of MMKR will present a summary of their findings and summarize the highlights of the City's 2008 Comprehensive Annual Financial Report. Al. Budget Impact: The City budgeted $35,500 for the audit based second year costs on the City's three year contact with MMKR A2. Staff Workload Impact: To complete the audit the finance staff has worked many hours providing information and constructing various worksheets and audit schedule for MMKR and this is the culmination of MMKR and staff's work. B. ALTERNATIVE ACTIONS Accept the 200 Audit Report. 2. Do not accept the 2008 Audit Report. C. STAFF RECOMMENDATION: The City staff supports, Alternative 1. D. SUPPORTING DATA: The draft of 2008 Comprehensive Annual Financial Report, Special Purpose Audit Report, and Management Letter. Final documents will be delivered at the meeting. Management Report for City of Monticello, Minnesota December 31, 2008 ' To the City Council City of Monticello, Minnesota We have prepared this management report in conjunction with our audit of the City of Monticello, Minnesota's (the City) financial statements for the year ending December 31, 2008. The purpose of this report is to communicate information relevant to city finances in Minnesota and to provide comments resulting from our audit process. We have organized this report into the following sections: • Audit Summary • Funding Cities in Minnesota • Governmental Funds Overview • Financial Trends and Analysis • Accounting and Auditing Updates We would be pleased to further discuss any of the information contained in this report or any other concerns that you would like us to address. We would also like to express our thanks for the courtesy and assistance extended to us during the course of our audit. This report is intended solely for the information and use of management, those charged with governance of the City, and those who have responsibility for oversight of the financial reporting process. INSERT DATE AUDIT SUMMARY The following is a summary of our audit work, key conclusions, and other information that we consider important or that is required to be communicated to the City Council, administration, or those charged with governance of the City. UNDERSTANDING THE AUDITOR'S RESPONSIBILITY Our responsibility, as stated in our engagement letter and as described by professional standards, is to plan and perform our audit to obtain reasonable, but not absolute assurance about whether the financial statements are free of material misstatement and are fairly presented in accordance with accounting principles generally accepted in the United States of America. Because an audit is designed to provide reasonable, but not absolute assurance and because we did not perform a detailed examination of all transactions, there is a risk that material misstatements may exist and not be detected by us. Our audit of the financial statements does not relieve you or management of your responsibilities. As part of our audit, we considered the internal control of the City. Such considerations were solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. PLANNED SCOPE AND TIMING OF THE AUDIT We performed the audit according to the planned scope previously discussed and coordinated with the City in order to obtain sufficient audit evidence and complete an effective audit. AUDIT OPINION AND FINDINGS • We have issued an unqualified opinion on the City's financial statements. We reported four findings related to the City's internal controls over financial reporting. These include findings on the following: o Recorded audit adjusting journal entries o Recorded prior period adjustments o Inadequate documentation of the components of internal controls o Deficiencies in the entity-level internal controls over information technology • We reported two findings related to the City's compliance with Minnesota laws and regulations. These findings include the following: o Contract language for the payment of subcontractors o Lack of a budget for capital improvements and lack of a parks and open space comprehensive plan SIGNIFICANT ACCOUNTING POLICIES Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 of the notes to basic financial statements. The City implemented Governmental Accounting Standards Board (GASB) Statement No. 45, "Accounting and Financial Reporting by Employers for Post-Employment Benefits Other Than Pensions," during the year ended December 31, 2008. This statement provides new guidance on accounting and financial reporting for "other post-employment benefits" (OPEB) accounted for in the financial statements of plan sponsors or employers. We noted no transactions entered into by the City during the year for which there is a lack of authoritative ' guidance or consensus. There are no significant transactions that have been recognized in the financial statements in a different period than when the transaction occurred. -l- AUDIT ADJUSTMENTS Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. Professional standards define an audit adjustment as a proposed correction of the financial statements ' that, in our judgment, may not have been detected except through our auditing procedures. An audit adjustment may or may not indicate matters that could have a significant effect on the City's financial reporting process (that is, cause future financial statements to be materially misstated). We recognize that for management purposes, the City maintains its accounting records primarily using the cash basis during the year. We did propose certain entries while assisting your finance staff in the closing of the year-end accounting records. These types of adjustments are not considered "misstatements" for purposes of this communication. 1 During our audit we made two audit adjustments that had a material impact on the financial statements. These audit adjustments were reviewed and approved by management and incorporated into the annual financial report of the City. ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS The City uses estimates of useful lives for the depreciation of capital assets. Management expects any differences between estimates and actual amounts of these estimates to be insignificant. We reviewed and tested management's procedures and underlying supporting documentation in the area discussed above. We concluded that the accounting estimates and management judgments appeared to consider all significant factors and resulted in appropriate accounting recognition. The most sensitive estimates affecting the financial statements were as follows: • Depreciation -Management's estimates of depreciation expense are based on the estimated useful lives of the assets. • Net Other Post-Employment Benefit (OPEB) Liabilities -Actuarial estimates of the net OPEB obligation is based on eligible participants, estimated future health insurance premiums, and estimated retirement dates. • Land Held for Resale -Management's estimates of this asset are based on net realizable value (lower of cost or estimated sales price). • Compensated Absences -Management's estimate is based on current rates of pay and sick leave balances. Management expects any differences between estimates and actual amounts of these estimates to be insignificant. We reviewed and tested management's procedures and underlying supporting documentation in the area discussed above. We concluded that the accounting estimates and management judgments appeared to consider all significant factors and resulted in appropriate accounting recognition. DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT We encountered no significant difficulties in dealing with management in performing and completing our audit. -2- DISAGREEMENTS WITH MANAGEMENT For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's report. We are pleased to report that no such disagreements arose during the course of our audit. MANAGEMENT REPRESENTATIONS We have requested certain representations from management that are included in the management representation letter dated INSERT DATE. MANAGEMENT CONSULTATIONS WITH OTHER INDEPENDENT ACCOUNTANTS In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the City's financial statements or a determination of the type of auditor's opinion that may be expressed on those statements, our professional standards require the ' consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. OTHER MATTERS We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. -3- FUNDING CITIES IN MINNESOTA LEGISLATION The following is a brief summary of recent legislative activity affecting the finances of Minnesota cities: 1 Levy Limitations -The 2008 Legislature passed a law that will limit general operating property tax levy increases for Minnesota cities with populations over 2,500 to 3.9 percent annually for the next three years. Local Government Aid (LGA) and Market Value Homestead Credit (MVHC) -Due to the state's economic condition, Minnesota cities received "unallotment" notices reducing the payment of these state aids for the second half of 2008. It is expected that these payments to cities may again be reduced for the 2009 fiscal year. FEDERAL RECOVERY ACT The American Recovery and Reinvestment Act of 2009 is expected to provide approximately $300 billion ' in federal funds to state and local governments, and to institutions of higher education. These funds are intended to supplement existing federal programs, create new programs, or provide more broad fiscal relief. Many cities are hoping to receive some of these temporary funds for programs and projects. The American Recovery and Reinvestment Act of 2009 mandates that there be an unprecedented amount of oversight and transparency around the spending of these funds, including specific audit and internal control requirements. The additional internal control requirements include the need for controls over the acceptance of recovery funds, appropriate controls over the segregation of these funds from other sources of revenue, compliance ' with the additional laws and regulations specific to each grant award, and additional financial reporting requirements back to the appropriate federal agency. ' These additional controls also include considerations into whether control procedures are in place over the federal grant expenditures to prevent unallowable expenditures, consideration into whether additional controls and systems will be needed to ensure funds are able to be separately tracked and identified, and consideration into if controls are sufficient for any funds that are passed along to subrecipients. PROPERTY TAXES Our management reports have tracked the evolution of property tax reform in Minnesota, and explained its impact on cities and their property owners. Now, with very little change in property tax formulas, attention is turning toward our current real estate and housing environment, mortgage foreclosures, and ~ the world economy. Property values within Minnesota cities experienced average increases of 11.0 percent for taxes payable in 2007 and 7.0 percent for those payable in 2008, reflecting the slowdown in growth in market values. In comparison, the City's market value increased by 16.8 percent in 2007 and 7.2 percent in 2008. It is important to remember that the 2008 market value is based on estimated values as of January 1, 2007, and the housing market is still experiencing difficult times. -4- The following graph shows the City's changes in taxable market value over the past six years: Market Value $1,400,000,000 $1,200,000,000 $1,000,000,000 $800,000,000 $600,000,000 $400,000,000 $200,000,000 $- 2003 2004 2005 2006 2007 2008 Tax capacity is considered the actual base available for taxation. It is calculated by applying the state's property classification system to each property's market value. Each property classification has a different calculation and uses different rates. The graphs show that tax capacities have not increased at the same rate as market values, primarily due to property tax reform occurring over this period of time. The following graph shows the City's change in tax capacities over the past six years: Tax Capacity $18,000,000 $15,000,000 $12,000,000 $9,000,000 $6,000,000 $3,000,000 $- 2003 2004 2005 2006 2007 2008 -5- Although it is impossible to consider every aspect and variable of local government spending, average tax rates are often used as a benchmark. Rates expressed as a percentage of net tax capacity All Cities Seven-County State-Wide Metro Area City of Monticello 2007 2008 2007 2008 2007 2008 Average tax rate City 36.1 36.3 33.4 33.6 42.5 46.9 County 38.5 38.0 35.2 34.9 30.7 31.7 School 22.2 21.1 22.7 21.3 23.2 25.3 Special taxing 5.5 5.6 6.8 7.0 3.0 2.5 Total 102.3 101.0 98.1 96.8 99.4 106.4 The City's portion as well as the total average tax rate for Monticello residents was well above the state-wide and metro area averages the last two years. -6- GOVERNMENTAL FUNDS OVERVIEW This section of the report provides you with an overview of the financial trends and activities of the City's governmental funds. Governmental funds include the General Fund, special revenue funds, debt service funds, and capital projects funds. We have also included the most recent comparative state-wide averages available from the State Auditor. The reader needs to consider the effect of inflation and other known changes or differences when comparing this data. Also, certain data on these tables may be classified differently than how they appear on the City's financial statements in order to be more comparable to the state-wide information, particularly in separating capital expenditures from current expenditures. We have designed this section of our management report using per capita data in order to better identify unique or unusual trends and activities of your city. We intend for this type of comparative and trend information to complement, rather than duplicate, information in the Management's Discussion and Analysis. An inherent difficulty in presenting per capita information is the accuracy of the population count, which for most years is based on estimates. ~ GOVERNMENTAL FUNDS REVENUE The amounts received from the typical major sources of revenue will naturally vary between cities based on their particular situation. This would include the City's stage of development; location, size, and density of its population; property values; services it provides; and other attributes. The following table presents the City's revenue per capita of its governmental funds for the past three years, together with state-wide averages: Governmental Funds Revenue per Capita With State-Wide Averages by Population Class State-Wide City of Monticello Year December 31, 2007 2006 2007 2008 Population 2,500-10,000 10,000-20,000 20,000-100,000 11,136 11,253 11,253 Property taxes $ 333 $ 332 $ 353 $ 580 $ 550 $ 643 Tax increments 46 52 56 71 73 104 Franchise fees and other taxes 22 32 35 - 13 - Special assessments 89 54 73 180 277 228 Licenses and permits 33 28 37 68 56 82 Intergovernmental revenues 273 267 169 84 157 49 Charges for services 106 88 82 251 257 204 Other 126 108 113 598 213 148 Total revenue $ 1,028 $ 961 $ 918 $ 1,832 $ 1,596 $ 1,458 The City has generated more property tax revenue for its governmental funds revenue compared to the average Minnesota city. The City continues to generate more tax increment revenue per capita than average, as it has made use of this tool to finance commercial development. The City generates more special assessment revenue (typically used for new development) as the City continues to be in a growth phase. The City's per capita governmental funds revenue for 2008 was $1,458, a decline of about 8.6 percent from the prior year. The largest decline was in intergovernmental revenues related to the City receiving less state aid for capital projects and street projects in 2008. The City also received less intergovernmental revenue related to cuts in state aid to cities during the unallotment process at the state level to balance the state-wide budget. Charges for services experienced declines in 2008 as engineering, planning, sanitary sewer, water, and storm water fees declined due to less development activity in the City during 2008. Other revenue above also decreased in 2008 as interest earnings in 2008 declined $63 per resident as interest rates declined significantly. -7- GOVERNMENTAL FUNDS EXPENDITURES Similar to our discussion of revenues, the expenditures of governmental funds will vary from state-wide averages and from year-to-year, based on the City's circumstances. Expenditures are classified into three types as follows: • Current -These are typically the general operating-type expenditures occurring on an annual basis, and are primarily funded by general sources such as taxes and intergovernmental revenues. • Capital Outlay and Construction -These expenditures do not occur on a consistent basis, more typically fluctuating significantly from year-to-year. Many of these expenditures are project-oriented, which are often funded by specific sources that have benefited from the expenditure, such as special assessment improvement projects. • Debt Service -Although the expenditures for debt service may be relatively consistent over the term of the respective debt, the funding source is the important factor. Some debt may be repaid through specific sources such as special assessments or redevelopment funding, while other debt maybe repaid with general property taxes. The City's expenditures per capita of its governmental funds for the past three years, together with state-wide averages, are presented in the following table: Governmental Funds Expenditures per Capita With State-Wide Averages by Population Class State-Wide City. of Monticello Year December 31, 2007 2006 2007 2008 Population 2,500-10,000 10,000-20,000 20,000-100,000 11,136 11,253 11,253 Current General government $ 122 $ 106 $ 83 $ 157 $ 169 $ 140 Public safety 208 224 223 248 142 154 Street maintenance and lighting 110 105 94 323 173 212 Recreation 62 83 82 204 197 197 All other 85 98 97 227 114 92 $ 587 $ 616 $ 579 $ 1,159 $ 795 $ 795 Capital outlay and construction $ 481 $ 341 $ 328 $ 1,174 $ 571 $ 313 Debt service Principal $ 161 $ 133 $ 100 $ 306 $ 301 $ 448 Interest and fiscal 71 47 39 213 201 195 $ 232 $ 180 $ 139 $ 519 $ 502 $ 643 The City's governmental funds current per capita expenditures are higher than state-wide averages for cities in the same population class. The City's current operating costs are higher than average in most categories other than public safety costs. The City's per capita expenditures for capital are higher than state-wide averages, but will vary on a yearly basis depending on current, ongoing capital projects. Debt service costs are significantly higher than other cities state-wide. -8- FINANCIAL TRENDS AND ANALYSIS GENERAL FUND The City's General Fund accounts for the financial activity of the basic services provided to the community. The primary services included within this fund are the administration of the municipal operations, police and fire protection, building inspection, streets and highway maintenance, and parks and recreation. The graph below illustrates the change in the General Fund financial position over the last six years. We have also included an expenditure line to reflect the change in the size of the General Fund operation over the same period. General Fund Financial Position Year Ended December 31, $8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $- 2003 2004 2005 2006 2007 2008 ~ Fund Balance O Cash Balance Expenditures The City's General Fund cash and investments balance at December 31, 2008 was $7,872,522, which increased about $775,000 from 2007. Total fund balance at December 31, 2008 was $6,178,552, up $617,065 from the prior year. Of this total fund balance, $4,892,113 was reserved or designated and $1,286,439 was undesignated. This fund balance level represents approximately 91 percent of the City's annual General Fund expenditures, based on 2008 expenditure levels. Over the last few years, the City has generally been able to maintain or increase cash and fund balance levels. This is an important factor because a government, like any organization, requires a certain amount of equity to operate. Generally, the amount of equity required typically increases as the size of the operation increases. A healthy fund balance is important because a government, like any organization, requires a certain amount of equity to operate. The amount of required equity increases as the size of the operation increases. Increase in the size of the operation is natural, caused by things such as inflation, population growth, desired increases in services, and-something which has impacted cities significantly in recent years-mandated increases in services and administrative requirements. A healthy financial position allows the City to avoid volatility in tax rates; helps minimize the impact of state funding changes; allows for the adequate and consistent funding of services, repairs, and unexpected costs; and can be a factor in determining the City's bond rating and resulting interest costs. -9- The following graph reflects the City's General Fund reliance on its revenue sources for 2008: General Fund Revenue Property Taxes Licenses/Permits Intergovernmental Charges for Services Other s~ OHO OHO ~~O ~p0 ~~O ADO OQO ~~O ~QO ~~O ~~O ODO ~h~p, ~O~p, hip, Opp, hpp, o~p, hip, ~o~p, ~~~p, Opp, hip, ~O~p, ~ ~1 ~'L ~`L ~"~ ss"~ ss ss es5 s~~ sg O Actual ^ Budget Total General Fund revenues for 2008 were $7,585,646, which was $149,885 (2 percent) over the final budget. Property taxes were less than budget by $283,387, mostly due to the second half of the MVHC not being received in 2008. License and permit revenues were over budget by $325,244 mostly related to storm damaged homes needing repairs and replacement permits. Charges for services were under budget by about $148,000, mostly due to engineering fees being about $82,500 under budget related to less projects taking place that required engineering services. The following graph presents the City's General Fund revenue sources for the last six years. The graph reflects the City's increasing reliance on taxes and user fees to finance its General Fund operations. General Fund Revenue by Source Year Ended December 31, $6,000,000 $5,500,000 $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $- 2003 2004 2005 2006 2007 2008 ^ Taxes ^ Intergovernmental O Other Overall, General Fund revenues increased $112,488 (1.5 percent) from the previous year. Property taxes was the largest increase totaling about $1,000,000 in calendar 2008. This increase is offset by a decline in charges for services totaling about $885,000. This decline was mainly in engineering fees of about $425,000 as discussed. This decline was also due to the City moving deputy registrar fees totaling about $270,000 to a separate special revenue fund in 2008. -10- The following illustrations provide you with the components of the City's General Fund spending for 2008 and for the past six years: General Fund Expenditures General Government Public Safety Public Works Culture and Recreation Other ~ oo° oo° oo° oo° oo° oo° oo° oo° oo° oo° oo° O Actual ^ Budget Total General Fund expenditures for 2008 were $6,806,940, which was $614,969 (8.3 percent) under the final budget. The largest variances were related to budgets for capital outlay in many of the city departments that were not spent in calendar 2008. The cumulative total of these under budgeted amounts total about $585,000. Bigger differences occurred in public safety where the budget included about $160,000 for some of the cost of a new fire truck which is expected to be purchased in fiscal 2009. The public works department budget included about $305,000 of unspent capital expenditures mainly for vehicles. General Fund Expenditures by Function Year Ended December 31, $2,400,000 $2,200,000 $2,000,000 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $- 2003 2004 2005 2006 2007 2008 ^ General Governmental ~ Public Safety ^ Public Works ^ Culture and Recreation ^ Other Overall, General Fund expenditures decreased $464,227 (6.4 percent) from the prior year. General government expenditures decreased about $325,000 which was mainly related to the move of the deputy registrar expenditures totaling around $180,000 being moved to a special revenue fund in fiscal 2008. Also, data processing costs decreased about $97,000 related to the startup costs of the fiber optics project reported in fisca12007. Public works department costs declined about $250,000 in 2008 as capital outlay programs decreased by almost $480,000 in fisca12008. -11- ENTERPRISE FUNDS The enterprise funds comprise a considerable portion of the City's activities. The following information provides trend information on the activities of these funds. Water Enterprise Fund At December 31, 2008, the Water Enterprise Fund had a cash balance of $2,123,494 and net assets of $12,423,941. Net assets consisted of $10,068,530 in amounts invested in capital assets and $2,355,411 in unrestricted net assets. Water Enterprise Fund Year Ended December 31, $1,100,000 $1,000,000 $900,000 $ 800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $- 2003 2004 2005 2006 2007 2008 O Operating Revenue ~ Operating Expense Operating Income (Loss) Before Depreciation Water Enterprise Fund operating revenues for 2008 were $992,430, which were $90,525 higher than the previous year. Most of this increase was related to an increase in the water rates. As shown in the above graph, operating income before depreciation has been steadily increasing over the past several years. It is important that this fund continue to have positive operating results so as not to place additional burden on other city funds. It is also important that the City continue to monitor water rates so that they are designed to also provide for future repairs and replacement of the infrastructure assets. -12- Sewer Enterprise Fund At December 31, 2008, the Sewer Enterprise Fund had a cash balance of $1,871,893 and net asset balance of $21,012,244. Net assets consisted of $18,944,284 invested in capital assets and $2,067,960 of unrestricted net assets. Sewer Enterprise Fund Year Ended December 31, $2,200,000 $2,000,000 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $- $(200,000) 2003 2004 2005 2006 2007 2008 O Operating Revenue ~ Operating Expense Operating Income (Loss) Before Depreciation Sewer Enterprise Fund operating revenues for 2008 were $1,338,199, which is $112,719 more than the previous year. Most of this increase relates to an increase in sewer rates. Operating income before depreciation was $280,175 in 2008. It is important that this fund have positive operating results so as not to place an additional burden on other city funds. It is also important that the City continue to monitor sewer rates so they are designed to also provide for future repairs and replacement of the infrastructure assets. -13- LIQUOR FUND The following graph presents six years of operating results for the Liquor Fund: Liquor Fund Year Ended December 31, $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $- 2003 2004 2005 2006 2007 2008 D Sales ~ Cost of Sales ~ Operating Expenses Operating Income (Loss) The Liquor Fund ended 2008 with net assets of $2,830,572, an increase of $365,614 from the prior year. Of the net asset balance, $476,372 represents the investment in liquor capital assets, leaving $2,354,200 of unrestricted net assets. Liquor sales for 2008 were $4,085,682, an increase of $316,605 (8.4 percent) from last year. Sales have steadily increased over the last several years, increasing by about 21 percent since 2003. The Liquor Fund generated a gross profit of $1,059,479 in 2008 or about 26 percent of gross sales. The Liquor Fund gross profit margin has been similar for the last several years, ranging from 25.5 percent to 26.6 percent between 2003 and 2008. Operating expenses for 2008 were $620,743, a decrease of $24,114 or 3.7 percent lower than last year. -14- GOVERNMENT-WIDE FINANCIAL STATEMENTS The City's financial statements include fund-based information that focuses on budgetary compliance, and the sufficiency of the City's current assets to finance its current liabilities. The GASB Statement No. 34 reporting model also requires the inclusion of two government-wide financial statements designed to present a clear picture of the City as a single, unified entity. These government-wide statements provide information on the total cost of delivering services, including capital assets and long-term liabilities. ^ Statement of Net Assets ' The Statement of Net Assets essentially tells you what your city owns and owes at a given point in time, the last day of the fiscal year. Theoretically, net assets represent the resources the City has leftover to use for providing services after its debts are settled. However, those resources are not always in spendable ' form, or there may be restrictions on how some of those resources can be used. Therefore, the Statement of Net Assets divides the net assets into three components: net assets invested in capital assets, net of related debt; restricted net assets; and unrestricted net assets. The following table presents the City's net assets as of December 31, 2008 for governmental activities and business-type activities: Governmental Business-Type Activities Activities Total Net assets Current and other assets $ 55,438,385 $ 31,598,427 $ 87,036,812 Net book value of capital assets 74,668,977 32,897,745 107,566,722 Current liabilities (4,576,409) (1,166,698) (5,743,107) Long-term liabilities (47,426,533) (27,404,404) (74,830,937) Total net assets $ 78,104,420 $ 35,925,070 $ 114,029,490 Net assets Invested in capital assets, net of related debt $ 27,584,763 $ 31,375,890 $ 58,960,653 Restricted 22,074,427 19,350 22,093,777 Unrestricted 28,445,230 4,529,830 32,975,060 Total net assets $ 78,104,420 $ 35,925,070 $ 114,029,490 The City's total net assets at December 31, 2008 were $5,079,040 higher than at the beginning of the year. A large portion of this increase was due to a prior period adjustment to capital assets and land held for resale totaling $4,637,388 to properly account for capital assets and land held for resale activity of the past several years. The City did have a significant decline in net assets within its business-type activities related to the deficit in the financial operation of the fiber optics project totaling about $1,150,000 in fisca12008. -15- ' ACCOUNTING AND AUDITING UPDATES ' GASB STATEMENT N0.45 -ACCOUNTING AND FINANCIAL REPORTING BY EMPLOYERS FOR POST-EMPLOYMENT BENEFITS OTHER THAN PENSIONS This statement provides new guidance on accounting and reporting for post-employment benefits other than pensions by employers when the plan is not accounted for in their financial statements. OPEB refer to non-pension benefits provided after the termination of employment. One example of this type of benefit is healthcare premiums paid by employers on behalf of former employees. Governmental entities have traditionally accounted for OPEB on apay-as-you-go basis, with only a few governments ' funding these benefits in advance of payment. The guidance in this statement rests on the assumption that OPEB liabilities should be accrued as they are earned by employees providing service to the entity. ' Under GASB Statement No. 45, governments offering OPEB will recognize the cost of these benefits using athree-step approach. The government will be required to project future benefits, discount those benefits to their present value, then use an acceptable actuarial method to allocate costs to individual ' accounting periods. Once calculated, the difference between the present value of OPEB benefits earned by employees as the result of past service and resources set aside to pay those benefits will be considered the "unfunded actuarial liability for OPEB." Every employer will be allowed to start fresh at the time of transition to the new standard. There will be no requirement for an employer to recognize an accounting liability for underfunding prior to the implementation of the new standard. Instead, the unfunded actuarial accrued ' liability for OPEB at transition would be amortized over 30 years. As long as an employer funds the full amount of the actuarially determined annual required contribution (ARC) for these benefits each year, no asset or liability will be reported on the Statement of Net Assets. However, an employer will need to ' report a "net pension obligation" on its Statement of Net Assets as an asset or liability if it contributes more or less, respectively, than the ARC each year. Nothing in the statement is intended to alter the normal application of modified accrual accounting in the governmental funds of the entity. Thus, in governmental funds, OPEB expenditures normally would be recognized when the benefits are due and payable rather than when benefits are earned. The guidance will require that actuarial valuations for OPEB occur at least every two years for plans with 200 or more members, and every 3 years for plans with fewer than 200 members. A sole employer plan with fewer than 100 plan members has the option to apply a simplified alternative measurement method rather than obtain actuarial valuations. The statement will become effective in three phases based on the same criteria as those defined for the ' implementation of GASB Statement No. 34. GASB Statement No. 45 will be phased in for cities over a three-year period, which started with category one cities in the fiscal year ending December 31, 2007. GASB STATEMENT N0.47 -ACCOUNTING FOR TERMINATION BENEFITS GASB Statement No. 47 provides accounting and reporting guidance for state and local governments that offer benefits such as early retirement incentives or severance to employees that are involuntarily terminated. The statement requires that similar forms of termination benefits be accounted for in the same manner and is intended to enhance both the consistency of reporting for termination benefits and the comparability of financial statements. GASB Statement No. 47 is effective for financial statements for periods beginning after June 15, 2005, or maybe implemented simultaneously with GASB Statement No. 45, depending on your circumstances. -16- GASB STATEMENT NO.50 -PENSION DISCLOSURES - AN AMENDMENT OF GASB STATEMENT ' Nos. 25 AND 27 This statement expands the disclosure requirements for pension plans, similar to those requirements in GASB Statement Nos. 43 and 45. This will require additional discussion on funding status, use of assumptions, and the determination of contribution rates. This statement is effective for cities for the year ended December 31, 2008. GASB STATEMENT NO.51-ACCOUNTING AND FINANCIAL REPORTING FOR INTANGIBLE ASSETS Governments possess many different types of assets that may be considered intangible assets, including ' easements, water rights, timber rights, patents, trademarks, and computer software. This statement requires that all intangible assets not specifically excluded by its scope provisions be classified as capital assets. The requirements in this statement improve financial reporting by reducing inconsistencies that ' have developed in accounting and financial reporting for intangible assets. These inconsistencies will be reduced through the clarification that intangible assets subject to the provisions of this statement should be classified as capital assets, and through the establishment of new authoritative guidance that addresses issues specific to these intangible assets given their nature. The requirements of this statement are effective for financial statements for periods beginning after June 15, 2009. GASB STATEMENT N0.53 -ACCOUNTING AND FINANCIAL REPORTING FOR DERIVATIVE INSTRUMENTS The guidance in this statement improves financial reporting by requiring governments to measure derivative instruments at fair value in their economic resources measurement focus financial statements. These improvements should allow users of those financial statements to more fully understand a government's resources available to provide services. The disclosures provide a summary of the government's derivative instrument activity and the information necessary to assess the government's objectives for derivative instruments, their significant terms, and the risks associated with the derivative instruments. The requirements of this statement are effective for financial statements for periods beginning after June 15, 2009. GASB STATEMENT N0.54 -FUND BALANCE REPORTING AND GOVERNMENTAL FUND TYPE DEFINITIONS The objective of this statement is to enhance the usefulness of fund balance information by providing clearer fund balance classifications that can be more consistently applied and by clarifying the existing governmental fund type definitions. This statement establishes fund balance classifications that comprise a hierarchy based primarily on the extent to which a government is bound to observe constraints imposed upon the use of the resources reported in governmental funds. The definitions of the general fund, special revenue fund type, capital projects fund type, debt service fund type, and permanent fund type are clarified by the provisions in this statement. The requirements are also intended to enhance the consistency between information reported in the government-wide statements and information in the governmental fund financial statements and avoid confusion about the relationship between reserved fund balance and restricted net assets. The requirements of this statement are effective for financial statements for periods beginning after June 15, 2010. -17- y'3 ~,:,r,,~~A CITY OF MONTICELLO WRIGHT COUNTY, MINNESOTA Special Purpose Audit Reports Year Ended December 31, 2008 CITY OF MONTICELLO Special Purpose Audit Reports Year Ended December 31, 2008 Table of Contents Page Independent Auditor's Report on Internal Control 1_2 Independent Auditor's Report on Compliance With Minnesota State Laws and Regulations 3 Schedule of Findings and Responses 4_~ INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL City Council and Residents City of Monticello, Minnesota We have audited the financial statements of the governmental activities, the .business- a activities each h'p , major fund, and the aggregate remaining fund information of the City of Monticello, Minnesota (the City) ' as of and for the year ended December 31, 2008, which collectively comprise the City's basic financial statements, and have issued our report thereon dated INSERT DATE. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Internal Control Over Financial Reporting In planning and performing our audit, we considered the City's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the City's internal control over financial reporting. Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and would not necessarily identify all deficiencies in internal control over financial reporting that might be significant deficiencies or material weaknesses. However, as discussed below, we identified certain deficiencies in internal control over financial reporting that we consider to be significant deficiencies. A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the City's ability to initiate, authorize, record, process, or ' report financial data reliably in accordance with accounting principles generally accepted in the United States of America such that there is more than a remote likelihood that a misstatement of the City's financial statements that is more than inconsequential will not be prevented or detected by the City's internal control. We consider the deficiencies described in the accompanying Schedule of Findings and Responses as items 2008-1, 2008-2, 2008-3, and 2008-4 to be significant deficiencies in internal control over financial reporting. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the fmancial statements will not be prevented or detected by the City's internal control. (continued) -1- Our consideration of the internal control over financial reporting was for the limited purpose described previously and would not necessarily identify all deficiencies in the internal control that might be significant deficiencies and, accordingly, would not necessarily disclose all significant deficiencies that are also considered to be material weaknesses. However, we believe the significant deficiencies described previously as items 2008-1 and 2008-2 to be material weaknesses. The City's responses to the findings identified in our audit are described in the accompanying Schedule of Findings and Responses. We did not audit the City's responses and, accordingly, we express no opinion on them. Closing This report is intended solely for the information and use of the City Council, management of the City, and the state of Minnesota and is not intended to be, and should not be, used by anyone other than these specified parties. INSERT DATE -2- INDEPENDENT AUDITOR' S REPORT ON COMPLIANCE WITH MINNESOTA STATE LAWS AND REGULATIONS City Council and Residents City of Monticello, Minnesota We have audited the financial statements of the overnmental acti i i - g v t es, the busmess type activities, each major fund, and the aggregate remaining fund information of the City of Monticello, Minnesota (the City) as of and for the year ended December 31, 2008, which collectively comprise the City's basic financial statements, and have issued our report thereon dated INSERT DATE. ' We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the provisions of the Minnesota Legal Compliance Audit Guide for Local Governments, promulgated by the State Auditor pursuant to Minnesota Statute § 6.65. Accordingly, the audit included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. The Minnesota Legal Compliance Audit Guide for Local Governments covers seven main categories of compliance to be tested: contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous provisions, and tax increment financing. Our study included all of the listed categories. The results of our tests indicate that, for the items tested, the City complied with the material terms and conditions of applicable legal provisions, except as noted in the Schedule of Findings and Responses. This report is intended solely for the information and use of the City Council, mana ement of the Ci g tY, and the state of Minnesota and is not intended to be, and should not be, used by anyone other than these specified parties. INSERT DATE -3- CITY OF MONTICELLO Schedule of Findings and Responses Year Ended December 31, 2008 This schedule summarizes findings and responses relating to internal control and compliance with Minnesota Statutes and other matters. The auditor, Malloy, Montague, Karnowski, Radosevich & Co., P.A. (MMKR), is responsible for providing the information under the headings "Criteria," "Condition," "Cause," "Effect," and "Recommendation." The City of Monticello, Minnesota (the City) is responsible for providing the information under the heading "Management's Response." A. FINDINGS -INTERNAL CONTROL OVER FINANCIAL REPORTING 2008-1 AUDIT ADJUSTING JOURNAL ENTRIES Criteria -Management is responsible for establishing and maintaining effective internal controls. These controls include the responsibility for preparation, or oversight of the preparation, of the financial statements in accordance with accounting principles generally accepted in the United States of America. Condition -During our audit procedures, we proposed audit adjustments to investment activity and escrow account activity that were considered material to the financial statements that had not been recorded properly in accordance with accounting principles generally accepted in the United States of America that were not initially identified by the City prior to our audit procedures detecting the misstatements. Auditing standards consider the identification by the auditor of a material misstatement in the financial statements prepared by the City that was not initially identified by the City to be a material weakness in the related internal controls. Cause -This was an oversight by city personnel. Effect -The financial information prepared by the City contained a misstatement, which misreported net assets and fund balances related to the fair value of investments and bond issue related escrow activity. Recommendation - We recommend that the City take the necessary steps to review procedures and internal controls to ensure that all material balances are properly reported by the City prior to the audit procedures taking place. Management's Response -There is no disagreement with the audit finding. The City will review account balance adjustment procedures to fairly state the financial statements prior to the start of the annual audit to ensure proper financial presentation. In the future, more than one individual will review and reconcile investment records to assure proper reporting. Fiscal 2008 was unique in that the City had many investments redeemed early on the last day of the year due to high interest rates creating deposits in transit. Also, due to the computer conversion less staff time was available to verify work. 2008-2 PRIOR PERIOD ADJUSTMENT Criteria -Internal control over financial reporting. -4- CITY OF MONTICELLO Schedule of Findings and Responses (continued) Year Ended December 31, 2008 A. FINDINGS -INTERNAL CONTROL OVER FINANCIAL REPORTING (CONTINUED) 2008-2 PRIOR PERIOD ADJUSTMENT (CONTINUED) Condition -During the year ended December 31, 2008, the City recorded prior period adjustments to more accurately reflect the capital assets and land held for resale in the City. These adjustments reflected a decline in fund balance in the amount of $653,661 in governmental funds, a decline in net assets of $2,970,368 in enterprise funds, and an increase in government-wide net assets in government activities of $7,607,756. Cause -This was caused by accounting errors in prior periods. Effect -The financial statements issued for the previous periods contained a misstatement, which misreported net assets reported in the City's financial statements by the value of the misreported capital assets and land held for resale. Recommendation - We recommend that the City review its controls over the identification and recording of the capital assets and land held for resale to ensure they are recorded correctly in the future. Management's Response -There is no disagreement with the audit finding. The City will continue to review and improve its procedures to assure all capital assets are properly recorded in the future. Many of the prior period adjustments were due to a change in audit firms, new staff, and inadequate documentation of prior asset records. Much of this has been corrected by current staff which has resulted in these prior period adjustments. 2008-3 INADEQUATE DOCUMENTATION OF THE COMPONENTS OF INTERNAL CONTROLS Criteria -New auditing and reporting standards specify that inadequate documentation of the components of internal controls are considered a significant deficiency in the design of internal controls. Condition -The City has verbally described to us the policies and procedures regarding various internal control procedures at the City. However, these policies and procedures are not in writing and, therefore, a finding exists. This is the case because implied or verbal policies and procedures are subject to greater variation of meaning and the likelihood of misinterpretation increases when a policy is not written. Cause -This was an oversight by city personnel. Effect -The City's internal controls are subject to greater variation of meaning and the likelihood of misinterpretation increases when a policy is not written. Recommendation - We recommend the City establish written internal control policies and procedures for the City's internal control processes. Management's Response -There is no disagreement with the audit finding. The new software system has altered many of our procedures. As the new processes become defined internal control procedures will be documented as stafftime permits. -5- CITY OF MONTICELLO Schedule of Findings and Responses (continued) Year Ended December 31, 2008 A. FINDINGS -INTERNAL CONTROL OVER FINANCIAL REPORTING (CONTINUED 2008-4 DEFICIENCIES IN THE ENTITY-LEVEL COMPONENTS OF INTERNAL CONTROLS Criteria -Management is responsible for establishing and maintaining effective internal controls including entity-level controls (control environment, risk assessment, information and communication, and monitoring) and for the fair presentation in the financial statements in accordance with accounting principles generally accepted in the United States of America. Condition -New auditing and reporting standards specify that we report deficiencies in the design of the entity-level controls of the City's internal controls. As part of our audit, we noted the City has not adequately designed the general controls over the information technology (IT) system in the City. These controls are intended to assure that the IT system of the City is able to provide complete and accurate information consistent with the financial reporting objectives and current needs of the City. Cause -This was an oversight by city personnel. Effect -The City is more susceptible to misstatement due to information technology. Recommendation - We recommend that the City develop and maintain internal controls over the IT functions of the City, including assessment of risk in the system, information and communication parameters, and a monitoring process. These internal controls would include the development of policies and procedures for the authorized access to documents, records, and computer programs. It would include establishing procedures for approving changes to IT applications or data programs. A good internal control system would also address and evaluate access to applications, potential loss of data, backup systems for critical data and programs, adequacy of data, disaster recovery/contingency planning, and specific application controls over accounting software. Management's Response -There is no disagreement with the audit finding. The City's staff was and is aware of this deficiency. The staff has developed a plan to move its computer servers offsite to the Fibernet Monticello headend building once the fiber optic network is operating. In addition, the new software has more security built into the system to limit the staff s ability to change or modify records. These two steps will address many of the deficiencies. In addition, the staff will continue to look for ways to monitor and improve IT security. ' B. FINDINGS -MINNESOTA LEGAL COMPLIANCE AUDIT 2008-5 CONTRACT LANGUAGE -PAYMENT OF SUBCONTRACTORS Criteria -Minnesota Statute § 574.26 Condition -City contracts must require the prime contractor to pay any subcontractor within 10 days of the prime contractor's receipt of payment from the City. This requirement was not included in all contracts entered into during the year by the City. -6- CITY OF MONTICELLO Schedule of Findings and Responses (continued) Year Ended December 31, 2008 B. FINDINGS -MINNESOTA LEGAL COMPLIANCE AUDIT (CONTINUED 2008-5 CONTRACT LANGUAGE -PAYMENT OF SUBCONTRACTORS (CONTINUED) Recommendation - We recommend that the City include this required language in all future contracts. Management's Response -There is no disagreement with the audit finding. The City will incorporate this required language in all future contracts. 2008-6 LACK OF CAPITAL IMPROVEMENT BUDGET AND PARKS AND OPEN SPACE PLAN Criteria -Minnesota Statute. § 462.358. Condition -Minnesota Statute § 462.358 requires that if the City requires a cash fee in lieu of dedication of buildable land for parks, recreation facilities, trails, wetlands, or open space, then the City must adopt a capital improvement budget and have a parks and open space plan or a parks, trails, and open space component in its comprehensive plan. The City did not adopt a capital improvement budget, have a parks and open space plan, or have a parks, trails, and open space component in its comprehensive plan during 2008. Recommendation - We recommend that the City adopt a capital improvement budget, have a parks and open space plan, and have a parks, trails, and open space component in its comprehensive plan in the future. Management's Response -There is no disagreement with the audit finding. The City does have a parks, trails, and open space component in its comprehensive plan that was adopted in 2008. However, it references having an approved parks, trails, and open space plan. The staff has developed a capital improvement plan and budget and has revised the .fee ordinance related to park dedication fees charged to meet Minnesota Statute 462.358, but has not yet presented to the City Council for final approval. -7- Proii~inary C3r~:tt CITY OF MONTICELLO WRIGHT COUNTY, MINNESOTA Annual Financial Report Year Ended December 31, 2008 CITY OF MONTICELLO Table of Contents Page INTRODUCTORY SECTION City Council and Administration i FINANCIAL SECTION INDEPENDENT AUDITOR'S REPORT 1 MANAGEMENT'S DISCUSSION AND ANALYSIS 2-11 BASIC FINANCIAL STATEMENTS Government-Wide Financial Statements Statement of Net Assets 12 Statement of Activities 13 Fund Financial Statements Governmental Funds Balance Sheet 14-15 Reconciliation of the Balance Sheet to the Statement of Net Assets 16 Statement of Revenue, Expenditures, and Changes in Fund Balances 17-18 Reconciliation of the Statement of Revenue, Expenditures, and Changes in Fund Balances to the Statement of Activities 19 Proprietary Funds Statement of Net Assets 20 Statement of Revenue, Expenses, and Changes in Fund Net Assets 21 Statement of Cash Flows 22 Notes to Basic Financial Statements 23-43 REQUIRED SUPPLEMENTARY INFORMATION City of Monticello Other Post-Employment Benefits Plan Schedule of Funding Progress 44 Budgetary Comparison Schedules Schedule of Revenue, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund 4519 Community Center Fund 50 Capital Outlay Revolving Fund 51 Sanitary Sewer Access Fund 52 Notes to the Required Supplementary Information 53 COMBINING NONMAJOR FUND STATEMENTS Nonmajor Governmental Funds Combining Balance Sheet 54-55 Combining Statement of Revenue, Expenditures, and Changes in Fund Balances 56-57 INTRODUCTORY SECTION CITY OF MONTICELLO City Council and Administration as of December 31, 2008 Clint Herbst Wayne Mayer Tom Perrault Brian Stumpf Susie Wojchouski CITY COUNCIL Term Expires 12/31/2008 12/31/2008 12/31 /2008 12/31/2010 12/31/2010 ADMINISTRATION Jeff O'Neill Tom Kelly Mayor Councilmember Councilmember Councilmember Councilmember City Administrator Finance Director -i- FINANCIAL SECTION INDEPENDENT AUDITOR'S REPORT City Council and Residents City of Monticello, Minnesota We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Monticello, Minnesota (the City) as of and for the year ended December 31, 2008, which collectively comprise the City's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of ' America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well 1 as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of December 31, 2008, and the respective changes in financial position and cash flows, where applicable thereof, for the year then ended in ' conformity with accounting principles generally accepted in the United States of America. As described in Note 1 of the notes to basic financial statements, the City has implemented Governmental Accounting Standards Board Statement No. 45, "Accounting and Financial Reporting by Employers for Post-Employment Benefits Other Than Pensions," during the year ended December 31, 2008. The Management's Discussion and Analysis, the Schedule of Funding Progress, and the budgetary comparison schedules, as listed in the table of contents, are not required parts of the basic financial statements, but are supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of required supplementary information. However, we did not audit the information and, accordingly, we express no opinion on it. Our audit was made for the purpose of forming an opinion on the financial statements that collectively comprise the City's basic financial statements. The introductory section and combining nonmajor fund statements, as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining nonmajor fund statements have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. The introductory section has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on it. ' INSERT DATE -1- CITY OF MONTICELLO Management's Discussion and Analysis Year Ended December 31, 2008 As management of the City of Monticello, Minnesota (the City), we offer the readers of these financial statements this narrative overview and analysis of the City's financial activities for the fiscal year ended December 31, 2008. FINANCIAL HIGHLIGHTS The assets of the City exceeded its liabilities at year-end by $114,029,490 (net assets). Of this amount, $32,975,060 (unrestricted net assets) may be used to meet the City's ongoing obligations to citizens and creditors. As of the close of the current fiscal year, the City's governmental funds reported combined ending fund balances of $35,194,348, a decrease of $3,710,555 from the prior year. Reserved and designated uses of fund balance totaled $23,281,868, leaving $11,912,480 available for spending at the City's discretion (unreserved and undesignated fund balance). At the end of the current fiscal year, unreserved - undesignated fund balance for the General Fund was $1,286,439 or 19 percent of total General Fund expenditures for 2008. The City targets 45 percent as the optimum fund balance level, providing a reserve for cash flow during the first five months of each subsequent year until property tax receipts are released from the county treasurer's office and distributed to the local levels of government. The amount that represents this 45 percent level is reported as designated for working capital in the General Fund. The City's total long-term liabilities increased by $20,849,169 (38.6 percent) during 2008. Principal payments made on outstanding debt totaled $20,945,592. The City issued new debt of $41,895,000 in 2008, which included refinancing of the Series 1997 General Obligation Wastewater Treatment Note, Series 2000A Public Project Revenue Bonds, and the financing of the Fiber Optics Project for the City. OVERVIEW OF THE FINANCIAL STATEMENTS This discussion and analysis is intended to serve as an introduction to the City's basic financial statements, which are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to basic financial statements. The report also contains other required supplementary information, which can provide detailed information on the City's financial activity. Government-Wide Financial Statements -The government-wide financial statements are designed to provide readers with a broad overview of the City's finances in a manner similar to a private sector business. The Statement of Net Assets presents information on all of the City's assets and liabilities, with the difference between the two reported as net assets. Over time, the changes in net assets may serve as a useful indicator of the financial health of the City. The Statement of Activities presents information showing how the City's net assets changed during the year. All changes in net assets are reported as soon as the underlying event affecting the change occurs, regardless of the timing of related cash flows. Therefore, revenues and expenses are reported in this statement for some items that will result in cash flows in future fiscal periods, such as uncollected taxes and earned but unused vacation leave. -2- Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenue (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities provided by the City include general government, public safety, public works, culture and recreation, sanitation, and economic development. Business-type activities include water, sewer, liquor, cemetery, and fiber optics activities. Fund Financial Statements - A fund is a grouping of related accounts used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other units of government, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the City's funds can be divided into two categories: governmental funds and proprietary funds. Governmental Funds -Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental funds financial statements focus on near-term receipt and use of spendable resources, as well as on the balance of spendable resources available at the end of the fiscal year. This information may be useful in evaluating a government's near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide statements. By doing so, readers may better understand the long-term impact of the City's near-term financing decisions. Both the governmental funds Balance Sheet and the governmental funds Statement of Revenue, Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this comparison. The City maintains several individual governmental funds. Information is presented separately in the governmental funds Balance Sheet and in the governmental funds Statement of Revenue, Expenditures, and Changes in Fund Balances for the General Fund, Community Center Special Revenue Fund, Capital Outlay Revolving Special Revenue Fund, Economic Development Authority Special Revenue Fund, Sanitary Sewer Access Special Revenue Fund, Debt Service Fund, and Capital Projects Fund, all of which are considered to be major funds. Data from the remaining governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report. The City adopts an annual budget for its General Fund and several special revenue funds. A budgetary comparison schedule has been provided for the General Fund and budgeted major special revenue funds to demonstrate compliance with the adopted budgets. Proprietary Funds -The City maintains five enterprise funds which are considered proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water and sewer service operations, liquor sales operation, cemetery maintenance, and fiber optics operation. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary funds financial statements provide separate information for each of the enterprise operations. Notes to Basic Financial Statements -The notes to basic financial statements provide additional information that is essential to obtaining a full understanding of the data provided in the government-wide and fund financial statements. Other Information -Additional information on nonmajor funds can be found in the combining nonmajor fund statements section of this report. -3- GOVERNMENT-WIDE FINANCIAL ANALYSIS As noted earlier, net assets may serve over time as a useful indicator of a government's financial position. The City's assets exceeded its liabilities by $114,029,490 at the end of 2008. A portion of the City's net assets (52 percent) reflects its investment in capital assets (e.g. land, buildings, machinery and equipment, and infrastructure) less any related outstanding debt used to acquire those assets. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other resources, since the capital assets themselves cannot be used to liquidate these liabilities. A portion of the City's net assets (28.9 percent) reflects its unrestricted net assets which may be used to meet the City's ongoing obligations to citizens and creditors. City of Monticello's Net Assets Governmental Activities Business-Ty pe Activities Total 2008 2007 2008 2007 2008 2007 Current and other assets $ 55,438,385 $ 61,404,850 $ 31,598,427 $ 7,037,454 $ 87,036,812 $ 68,442,304 Capital assets 74,668,977 64,855,170 32,897,745 34,892,612 107,566,722 99,747,782 Total assets 130,107,362 126,260,020 64,496,172 41,930,066 194,603,534 168,190,086 Long-term liabilities 47,426,533 52,970,319 27,404,404 1,011,449 74,830,937 53,981,768 Other liabilities 4,576,409 4,751,872 1,166,698 505,996 5,743,107 5,257,868 Total liabilities 52,002,942 57,722,191 28,571,102 1,517,445 80,574,044 59,239,636 Net assets Invested in capital assets, net of related debt 27,584,763 12,476,536 31,375,890 33,971,151 58,960,653 46,447,687 Restricted 22,074,427 31,517,792 19,350 - 22,093,777 31,517,792 Unrestricted 28,445,230 24,543,501 4,529,830 6,441,470 32,975,060 30,984,971 Total net assets $ 78,104,420 $ 68,537,829 $ 35,925,070 $ 40,412,621 $ 114,029,490 $ 108,950,450 At the end of 2008, the City was able to report positive balances in all three categories of net assets, both for the government as a whole and for its separate governmental and business-type activities. Governmental Activities -The net assets invested in capital assets, net of related debt in the City's governmental activities increased from the previous year due to significant infrastructure improvements and additions. A significant portion of the increase was related to the continuation of the City's Reconstruction Program and the additional improvements to the City's infrastructure, including reconstruction of Jerry Liefert and Kevin Longley Drives in 2008. The City also had a significant prior period adjustment in fiscal 2008 that was due to efforts by city management to properly account for land held for resale and capital assets of the City put in place over the last several years. Business-Type Activities -The net assets invested in capital assets, net of related debt in the City's business-type activities decreased during 2008 mainly due to the prior period adjustment in fiscal 2008 that was due to efforts by city management to properly account for land held for resale and capital assets of the City put in place over the last several years. The reason for the decrease of unrestricted net assets is related to the new bond taken out for the construction of the City's Fiber Optics Project. In 2008, the project included the construction of the central office building which will house the electronics for the system and fiber backbone within the City. -4- City of Monticello's Changes in Net Assets Governmental Activities Business-Ty pe Activities Total 2008 2007 2008 2007 2008 2007 Revenues Program revenues Charges for services $ 3,243,202 $ 3,804,959 $ 3,364,794 $ 3,096,619 $ 6,607,996 $ 6,901,578 Opera6nggrantsandcontributions 159,192 160,147 - - 159,192 160,147 Capital grants and contributions 948,340 3,616,870 106,787 482,412 1,055,127 4,099,282 General revenues Property taxes 8,450,599 7,242,838 - - 8,450,599 7,242,838 General grants and aids 158,340 288,940 - - 158,340 288,940 [nvestmentearnings 1,461,658 2,170,025 547,703 326,356 2,009,361 2,496,381 Other 233,326 528,193 136,356 62,664 369,682 590,857 Total revenues 14,654,657 17,811,972 4,155,640 3,968,051 18,810,297 21,780,023 Expenses General government 1,572,389 1,844,320 - - 1,572,389 1,844,320 Public safety 1,792,351 1,693,116 - - 1,792,351 1,693,116 Public works 4,634,167 4,559,460 - - 4,634,167 4,889,460 Sanitation 514,208 509,208 - - 514,208 509,208 Culture and recreation 2,700,683 2,661,915 - - 2,700,683 2,661,915 Economic development 510,126 769,584 - - 510,126 769,584 Interest 2,136,872 2,193,840 - - 2,136,872 2,193,840 Water - - 975,846 973,375 975,846 973,375 Sewer - - 2,085,485 2,000,610 2,085,485 2,000,610 Liquor - - 620,743 644,857 620,743 644,857 Cemetery - - 29,267 41,312 29,267 41,312 Fiber optics - - 1,590,237 84,594 1,590,237 84,594 Total expenses 13,860,796 14,231,443 5,301,578 3,744,748 19,162,374 17,976,191 Increase in net assets before transfers 793,861 3,580,529 (1,145,938) 223,303 (352,077) 3,803,832 Transfers 371,245 997,929 (371,245) (997,929) Change in net assets 1,165,106 4,578,458 (1,517,183) (774,626) (352,077) 3,803,832 Beginning of year, as previously reported 68,537,829 63,959,371 40,412,621 41,187,247 108,950,450 105,146,618 Prior period adjustment 8,401,485 - (2,970,368) - 5,431,117 - Beginning of year, as restated 76,939,314 63,959,371 37,442,253 41,187,247 114,381,567 105,146,618 Net assets -ending $ 78,104,420 $ 68,537,829 $ 35,925,070 $ 40,412,621 $ 114,029,490 $ 108,950,450 -5 - GOVERNMENTAL ACTMTIES -REVENUES Revenues by Source -Governmental Activities Charges for General Grants Services __~ ..:~_ 22% gating Grants contributions 1% Property Taxes 58% Other 12% Revenues for the City's governmental activities decreased by $3,157,315 or 17.7 percent. The major components of this decrease are explained as follows: • Capital grants and contributions decreased by $2,668 or 73.8 percent. This decrease was due to a decline of capital project activity in fisca12008. • Charges for services decreased by $561,757 or 14.8 percent. This decrease was primarily due to a reduction in sanitary sewer access fees collected of $177,830, a reduction in storm sewer access fees of $50,272, a reduction in water access fees of $55,688, and a reduction in planning and engineering fees of $481,946, all due to a decrease in new development and construction activities. • Investment earnings decreased by $708,367 due to a decrease in interest rates and available cash to invest from the prior year. Expenses -City expenses for governmental activities decreased by $370,647 or 2.6 percent. This decline is primarily due to a decline in overall general government costs. -6- Capital Grants and Contributions 6% GOVERNMENTAL ACTIVITIES -BUSINESS-TYPE ACTIVITIES Revenues by Source -Business-Type Activities Capital Grants and Contributions 3% Charges for Services 81% Business-type activities decreased the City's net assets by $1,517,183. The rates for each of the City's utility services operated as enterprise funds are reviewed annually and adjusted by the City Council to assure operating revenues are independently sufficient to cover their own operating expenses and provide for their own capital equipment replacement needs. Capital grants and contributions may be necessary for the future replacement of facility needs as the current and projected future rates will not be sufficient for their ultimate replacement. The City's business-type charges for services increased by $268,175 or 8.6 percent primarily due to increased sales from the liquor store operation of $56,546 and additional revenue from sewer and water charges of $215,984. Capital grants and contributions decreased by $375,625 due to a decrease in capital asset contributions from governmental funds. Business-type expenses increased from the previous year by approximately $1,550,000 due to increased costs related to the Fiber Optics Fund of $1,505,643. -7- Unrestricted Investment FINANCIAL ANALYSIS OF THE GOVERNMENT'S FUNDS As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental Funds -The focus of the City's governmental funds is to provide information on near-term receipts, uses, and balances of spendable resources. Such information is useful in assessing the City's financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of $35,194,348, a decrease of $3,710,555 from the prior year. Approximately 51.5 percent of this total amount ($11,912,480) constitutes unreserved and undesignated fund balance, which is available for spending at the City's discretion. The remainder of fund balance is designated to indicate that, although it is available for spending, it has been internally committed: 1) to liquidate contracts and purchase orders of the prior period; 2) to pay debt service, or 3) for a variety of other designated purposes. The City's General Fund increased $617,065 during the current fiscal year. Increased licenses and permits, and property taxes provided additional revenues in 2008. The City also implemented a new revenue source, the rental housing inspection fees, which generated an additional $5,545 in General Fund revenue in 2008. Each of the main activities of the General Fund were completed efficiently and effectively as authorized within the adopted budget, without using reserve balances. This resulted in total General Fund expenditures being under budget by $614,969 for the year. Community Center Special Revenue Fund -The increase in the Community Center Special Revenue Fund balance was the result of additional revenue generated through increases in memberships, an increase in property tax revenues, and a decrease in the transfer to the debt service funds for the 2008 debt payment for the facility, which was refinanced in 2008. Sanitary Sewer Access Special Revenue Fund -The Sanitary Sewer Access Special Revenue Fund decreased by $971,515 due to reduced revenues because of less new development activity taking place in the City and the transfer of funds for the Sanitary Sewer Access Special Revenue Fund's share of debt service payments. Capital Projects Fund -This fund's resources decreased in the current year primarily from previous proceeds from the sale of bonds being used for completion of various public improvement projects. -8- Proprietary Funds -The City's proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. Unrestricted net assets at the end of the year totaled $4,423,371 for the Water Fund and Sewer Fund, $2,373,751 for the Liquor and Cemetery Funds, and a deficit ($2,267,292) for the Fiber Optics Fund. Capital assets, net of related debt, account for approximately 87.3 percent of total enterprise fund net assets. The City is in the process of installing a fiber optic network to every premise in the City to provide phone, high-speed Internet, and cable television services. The City will pay for the cost of operation and maintenance of the system from user fees. Since the City is in the very early stages of implementing this system, this enterprise fund has no capital assets currently. The City also operates a municipal liquor operation with some of the profits used to reduce the property tax levies required to operate other city activities. Other factors concerning the finances of these funds have been presented in the discussion of the business-type activities. The expenses exceeded revenues in the Water Fund and Sewer Fund during 2008 by $526,598. The Water Fund and Sewer Fund expended $813,813 in infrastructure improvements in 2008 to accompany the ongoing street improvement projects. These costs were not offset by the 2008 water rates and revenue flow of the water utility. The debt service interest and depreciation amounts impact the net income position of these funds. The City's liquor operations ended the year with increases in net assets from operations, while the City's cemetery operations saw a decrease in net assets. The Cemetery Fund sets its charges and fees at a level to breakeven or have a slight increase. The City's Liquor Fund had operating net income of over $441,000 and transferred $171,619 to other funds to reduce property taxes. In 2007, the City started its Fiber Optics Froject, which will run a fiber optic system to every premise in the City to provide customers with phone, high-speed Internet, and cable television services as a self-supporting system with competitive pricing which will act as an economic development tool for the City. The project was still in the startup phase as of the year ended 2008. -9- GENERAL FUND BUDGETARY HIGHLIGHTS General Fund revenues for 2008 exceeded budget by $149,885 in total. Licenses and permits collected were $325,244 higher than anticipated due to a hail storm that affected the City, causing the majority of the homes and business to need permits for replacing damaged roofing and siding. General Fund expenditures for 2008 were $614,969 less than budgeted. The cost reductions included an unfilled position in general government, lower than anticipated legal fees, and less funds spent on consulting engineering due to fewer new development and construction projects. In addition, there were funds budgeted for equipment purchases, such as a new fire truck, that were not used because the purchases were delayed until future years. These funds will be designated equipment purchases in the future. CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets -The City's investment in capital assets for its governmental and business-type activities amounts to $107,566,722 as of December 31, 2008, net of accumulated depreciation. This investment in capital assets includes fire and public works equipment, park and recreation facilities, buildings, roads, sewer, water, and storm sewer utilities. This amount represents a net increase (including additions and deductions) of $7,818,940 over last year. City of Monticello's Capital Assets Governmental Activities Business-Ty pe Activities Total 2008 2007 2008 2007 2008 2007 Land $ 8,457,484 $ 7,162,826 $ 1,751,945 $ 1,217,845 $ 10,209,429 $ 8,380,671 Construction in progress 33,451,897 24,927,847 2,986,104 6,191,218 36,438,001 31,119,065 Infrastructure 36,783,454 35,043,517 28,847,331 28,510,507 65,630,785 63,554,024 Buildings 13,102,213 13,135,936 5,156,471 5,156,471 18,258,684 18,292,407 Improvements other than buildings 4,331,791 4,115,256 19,720,949 18,056,314 24,052,740 22,171,570 Machinery, equipment, and vehicles 3,617,456 3,266,866 1,524,866 1,380,772 5,142,322 4,647,638 Less accumulated depreciation (25,075,318) (22,797,078) (27,089,921) (25,620,515) (52,165,239) (48,417,593) Net total $ 74,668,977 $ 64,855,170 $ 32,897,745 $ 34,892,612 $107,566,722 $ 99,747,782 Additional information on the City's capital assets is located in Note 3 of the notes to basic financial statements. Long-Term Debt - At the end of 2008, the City has total bonded debt outstanding in the amount of $73,972,307, of which $24,075,000 are special assessment bonds outstanding. The City has pledged revenue streams from general property taxes; redevelopment district tax increments; the community center; water and sewer utility; and sewer, water, and storm sewer access funds for the principal and interest payments due on these bonds. The City issued $41,895,000 in new bonds in 2008. These bonds will finance the construction the Fiber Loop Project, the refunding of the Series 1997 General Obligation Wastewater Treatment Note, and the refunding of the Series 2000A Public Project Revenue Bonds. -10- City of Monticello's Outstanding Debt Governmental Business-Type Activities Activities Total 2008 2007 2008 2007 2008 2007 General obligation bonds $ 6,907,903 $ 7,132,903 $ 907,097 $ 907,097 $ 7,815,000 $ 8,040,000 Tax increment bonds 575,000 680,000 - - 575,000 680,000 Special assessment bonds 24,075,000 28,415,000 - - 24,075,000 28,415,000 General obligation notes 8,830,000 9,515,592 - - 8,830,000 9,515,592 Revenue bonds 6,180,000 6,220,000 26,445,000 - 32,625,000 6,220,000 Contract for deed 564,293 664,293 - - 564,293 664,293 Total $ 47,132,196 $ 52,627,788 $ 27,352,097 $ 907,097 $ 74,484,293 $ 53,534,885 The City's total debt increased by $20,949,408 or approximately 39 percent during 2008. State statutes limit the amount of general obligation debt a governmental entity may issue to 3.0 percent of its taxable market value. The current debt limit is $37,306,764, which is significantly in excess of the City's outstanding net general obligation debt of $16,645,000, which is subject to the limitation. Additional information on the City's debt is located in Note 4 of the notes to basic financial statements. ECONOMIC FACTORS AND NEXT YEAR'S BUDGET The City considered many factors when setting the fiscal year 2009 budget, rates, and fees that will be charged in the business-type activities. With the City Council's decision to increase the previous year's tax levy by $150,000, they used the electric utility franchise fee of 3 percent, which is expected to generate $250,000 in revenue for streetlight improvements. Budgeted revenues for permits and charges for services were reduced to reflect less new development activity taking place in 2009. Budgeted sewer and water user fees were increased by 5 percent to be used to fund operational costs for their departments that were previously covered by the General Fund. Finally, reserve funds of $509,643 from the debt service funds and $150,000 from enterprise funds were included to balance the budget. The City's property tax levy for 2009 will amount to $7,750,000, which is $150,000 more than 2008. REQUESTS FOR INFORMATION The City's financial statements are designed to provide our citizens, customers, and creditors with a general overview of the City's finances and to show the City's accountability for the money it receives. If you have questions about this report or need additional financial information, contact the City of Monticello, Finance Department at 505 Walnut Street, Suite No. 1, Monticello, Minnesota 55362. -11- BASIC FINANCIAL STATEMENTS CITY OF MONTICELLO Statement of Net Assets as of December 31, 2008 Assets Cash and investments Receivables Delinquent taxes Deferced special assessments Delinquent special assessments Accounts Interest Due from other governmental units Notes Land held for resale Inventory Prepaid items Unamortized bond issuance costs Restricted assets Cash and investment held for fiber optics activity Capital assets, not being depreciated Land Construction in progress Capital assets, being depreciated Buildings Furniture and equipment Vehicles Machinery and equipment Improvements other than buildings Infrastructure Less accumulated depreciation Total capital assets, net of depreciation Total assets Liabilities Current liabilities Accounts and contracu payable Other accrued liabilities Due to other governmental units Accrued interest payable Unamortized premiums Unearned revenues Net OPEB obligation Escrow deposits Long-term liabilities Due within one year Due within more than one year Total long-term liabilities Total liabilities Net assets Invested in capital assets, net of related debt Restricted for debt service Unrestricted Total net assets Total liabilities and net assets See notes to basic financial statements Governmental Business-Type Activities Activities Totals $ 30,853,978 $ 4,322,408 $ 35,176,386 290,783 - 290,783 14,01 I ,932 151, 844 14,163,776 699,433 19,803 719,236 275,995 608,395 884,390 347,178 53,149 400,327 10,692 - 10,692 2,585,439 - 2,585,439 5,994,312 - 5,994,312 - 569,537 569,537 107,021 30,121 137,142 261,622 1,084,492 I ,346,114 24,758,678 24,758,678 8,457,484 1,751,945 10,209,429 33,451,897 2,986,104 36,438,001 13,102,213 5,156,471 18,258,684 335,393 118,373 453,766 2,042,324 608,139 2,650,463 1,239,739 798,354 2,038,093 4,331,791 19,720,949 24,052,740 36,783,454 28,847,331 65,630,785 (25,075,318) (27,089,921) (52,165,239) 74,668,977 32,897,745 107,566,722 $ 130,107,362 $ 64,496,172 $ 194,603,534 $ 541,508 $ 1,017,237 $ 1,558,745 133,204 19,195 152,399 732,230 41,262 773,492 933,512 - 933,512 213,640 12,928 226,568 - 73,193 73,193 53,680 - 53,680 1,968,635 2,883 1,971,518 6,826,912 81,498 6,908,410 40,599,621 27,322,906 67,922,527 47,426,533 27,404,404 74,830,937 52,002,942 28,571,102 80,574,044 27,584,763 31,375,890 58,960,653 22,074,427 .19,350 22,093,777 28,445,230 4,529,830 32,975,060 78,104,420 35,925,070 114,029,490 $ 130,107,362 $ 64,496,172 $ 194,603,534 -12- CITY OF MONTICELLO Statement of Activities Year Ended December 31, 2008 Program Revenues Net (Expense) Revenue and Changes in Net Assets Operating Capital Business- Charges for Grants and Grants and Governmental Type Functions/Programs Expenses Services Contributions Contributions Activities Activities Totals Governmental activities General government $ 1,572,389 $ 523,228 $ - $ - $ (1,049,161) $ - $ (1,049,161) Public safety 1,792,351 99,812 128,871 139,239 (1,424,429) - (1,424,429) Public works 4,634,167 1,544,140 14,020 717,216 (2,358,791) - (2,358,791) Sanitation 514,208 - - - (514,208) - (514,208) Culture and recreation 2,700,683 1,060,147 16,301 91,885 (1,532,350) - (1,532,350) Economic development 510,126 15,875 - - (494,251) - (494,251) Interest 2,136,872 - - - (2,136,872) - (2,136,872) Total governmental activities 13,860,796 3,243,202 159,192 948,340 (9,510,062) - (9,510,062) Business-type activities Water 975,846 973,776 - - Sewer 2,085,485 1,307,064 - 15,413 Liquor 620,743 1,059,479 - - Cemetery 29,267 24,475 - - Fiber optics 1,590,237 - - 91,374 Total business-type activities 5,301,578 3,364,794 - 106,787 Total governmental and business-type activities $ 19,162,374 $ 6,607,996 $ 159,192 $ 1,055,127 General revenues Property taxes General aids and grants -unrestricted Investment earnings Other general revenues Transfers Total general revenues and transfers Change in net assets Beginning of year, as previously reported Prior period adjustment Beginning of year, as restated Net assets -ending See notes to basic financial statements - (2,070) (2,070) - (763,008) (763,008) - 438,736 438,736 - (4,792) (4,792) (1,498,863) (1,498,863) _ (1,829,997) (1,829,997) (9,510,062) (1,829,997) (11,340,059) 8,450,599 - 8,450,599 158,340 - 158,340 1,461,658 547,703 2,009,361 233,326 136,356 369,682 371,245 (371,245) - 10,675,168 312,814 10,987,982 1,165,106 (1,517,183) (352,077) 68,537,829 40,412,621 108,950,450 8,401,485 (2,970,368) 5,431,117 76,939,314 37,442,253 114,381,567 $ 78,104,420 $ 35,925,070 $114,029,490 -13- CITY OF MONTICELLO Assets Cash and investments Receivables Delinquent taxes Deferred special assessments Delinquent special assessments Accounts Accrued interest Due from other governmental units Notes receivable Due from other funds Land held for resale Prepaid items Total assets Liabilities and Fund Balances Liabilities Accounts and contracts payable Other accrued liabilities Due to other governmental units Due to other funds Deferred revenue Escrow deposits Total liabilities Fund balances Reserved Notes receivable Debt retirement Prepaid items Land held for resale Unreserved -designated Unreserved - undesignated reported in General Fund Special revenue funds Capital Projects Fund Total fund balances Total liabilities and fund balances See notes to basic financial statements Balance Sheet Governmental Funds as of December 31, 2008 Special Revenue Funds Economic Community Capital Outlay Development General Center Revolving Authority $ 7,872,522 $ 756,063 $ 522,172 $ 1,680,999 210,604 50,658 48 13,316 187 - 432,661 - 7,696 - 3,718 - 134,707 2,751 8,289 2,938 66,436 6,756 20,507 15,259 10,692 - - _ 279,687 - - 705,752 - - 1,607,609 - - - 3,149,426 2,844,886 79,616 25,105 - - $ 8,662,147 $ 841,333 $ 5,744,430 $ 5,263,150 $ 187,954 $ 7,296 102,639 25,238 36,973 4,747 197,924 54,307 1,958,105 3,030 2,483,595 94,618 $ 32,595 $ 77,938 436,379 12,556 - 7,500 468,974 97,994 279,687 - - 705,752 - - - 564,293 79,616 25,105 - - - - 3,149,426 2,844,886 4,532,810 63,000 932,434 - 1,286,439 - _ _ - 658,610 1,193,596 1,050,225 6,178,552 746,715 5,275,456 5,165,156 $ 8,662,147 $ 841,333 $ 5,744,430 $ 5,263,150 -14- Sanitary Sewer Access Debt Service Capital Projects Nonmajor Funds Totals $ 4,964,417 $ 9,232,827 $ - $ 5,824,978 $ 30,853,978 - 275 - 15,882 290,783 897,139 11,197,565 - 1,484,380 14,011,932 86,507 252,474 - 349,038 699,433 4,602 18,285 - 104,423 275,995 56,483 142,220 (11,324) 50,841 347,178 - - - - 10,692 - 1,600,000 - - 2,585,439 - - - - 1,607,609 - - - - 5,994,312 131 435 - 1,734 107,021 $ 6,009,279 $ 22,444,081 $ (11,324) $ 7,831,276 $ 56,784,372 $ 605 $ - $ 220,545 $ 14,575 $ 541,508 - - - 5,327 133,204 - - - 690,510 732,230 - - 1,607,609 - 1,607,609 983,646 13,071,607 - 1,850,419 16,606,838 - - - - 1,968,635 984,251 13,071,607 1,828,154 2,560,831 21,590,024 - - - - 985,439 - 9,372,039 - - 9,936,332 131 435 - 1,734 107,021 - - - - 5,994,312 - - - 730,520 6,258,764 - - - - 1,286,439 5,024,897 - - 4,538,191 12,465,519 - - (1,839,478) - (1,839,478) 5,025,028 9,372,474 (1,839,478) 5,270,445 35 194 348 , , $ 6,009,279 $ 22,444,081 $ (11,324) $ 7,831,276 $ 56,784,372 -15- CITY OF MONTICELLO Reconciliation of the Balance Sheet to the Statement of Net Assets Governmental Funds as of December 31, 2008 Total fund balances -governmental funds $ 35,194,348 Amounts reported for governmental activities in the Statement of Net Assets are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported as assets in governmental funds. These assets consist of: Land 8,457,484 Construction in progress 33,451,897 Buildings 13,102,213 Furniture and equipment 335,393 Vehicles 2,042,324 Machinery and equipment 1,239,739 Improvements other than buildings 4,331,791 Infrastructure 36,783,454 Less accumulated depreciation (25 075 318) > > Some of the City's property taxes, special assessments, and notes receivable will be collected after year-end, but are not available soon enough to pay for the current period's expenditures, and, therefore, are reported as deferred revenue in the governmental funds. 16,606,838 Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an expenditure when due. Accrued interest for general obligation bonds is included in the Statement of Net Assets. (933,512) Net other post-employment benefit obligations payable reported in the Statement of Net Assets do not require the use of current financial resources and are not reported as liabilities in governmental funds until actually due. (53,680) Long-term liabilities that pertain to governmental funds, including bonds payable, are not due and payable in the current period and, therefore, are not reported as fund liabilities. All liabilities, both current and long-term, are reported in the Statement of Net Assets: Bonds payable (46,567,903) Contract for deed payable (564,293) Unamortized bond issuance costs 261,622 Unamortized bond premiums (213,640) Compensated absences (294,337) Total net assets -governmental activities $ 78,104,420 See notes to basic financial statements -16- CITY OF MONTICELLO Statement of Revenue, Expenditures, and Changes in Fund Balances Governmental Funds Year Ended December 31, 2008 Special Revenue Funds Economic Community Capital Outlay Development General Center Revolving Authority Revenue Property taxes $ 5,460,542 $ 1,360,350 $ 263 $ 1,172,447 Special assessments 5,970 - 139,498 - Licenses and permits 917,539 - - - Intergovernmental 368,938 25,290 - 9,231 Changes for services 324,378 1,067,038 - 15,875 Fines 2,216 - - - Interest earnings (chazges) 328,195 36,334 100,340 120,896 Miscellaneous 178,066 13,381 - 745 Total revenue 7,585,844 2,502,393 240,101 1,319,194 Expenditures Current General government 1,579,164 - - - Public safety 1,736,962 - - - Public works 1,892,566 - 55,952 - Sanitation 514,208 - - - Culture and recreation 627,154 1,550,878 - - Economic development 79,647 - - 446,136 Capital outlay General government 5,400 - - - Public safety 15,747 - - - Public works 232,311 - - - Culture and recreation 123,781 5,224 - - Economic development - _ _ _ Debt service Principal - - - 100,000 Interest and fiscal charges - - - 58,751 Total expenditures 6,806,940 1,556,102 55,952 604,887 Excess (deficiency) of revenues over expenditures 778,904 946,291 184,149 714,307 Other fmancing sources (uses) Transfer in 46,390 - - 20,703 Transfer out (210,804) (690,000) (794,545) (468,767) Proceeds from sale of assets 2,575 - - - Proceeds on sale of land held for resale - - - 74,650 Principal payment to refunding escrow account - - _ _ Deferred amortized gain on refunding - _ Proceeds from sale of bonds - - _ _ Total other financing sources (uses) (161,839) (690,000) (794,545) (373,414) Net change in fund balances 617,065 256,291 (610,396) 340,893 Fund balances (deficit) Beginning of yeaz, as previously reported 5,561,487 490,424 8,470,819 2,536,420 Prior period adjustment - - (2,584,967) 2,287,843 Beginning of yeaz, as restated 5,561,487 490,424 5,885,852 4,824,263 End of yeaz $ 6,178,552 $ 746,715 $ 5,275,456 $ 5,165,156 See notes to basic financial statements -17- Sanitary Sewer Access Debt Service Capital Projects Nonmajor Funds Totals $ - $ 2,113 $ - $ 410,314 $ 8,406,029 257,896 1,784,941 - 378,627 2,566,932 - - - - 917,539 - - - 146,824 SS0,283 270,753 - - 612,047 2,290,091 - - - - 2,216 254,622 421,307 (44,SS4) 244,518 1,461,658 - - - 5,796 197,988 783,271 2,208,361 (44,SS4) 1,798,126 16,392,736 - - - - 1,579,164 - - - - 1,736,962 18,4SS - - 414,020 2,380,993 - - - - 514,208 - - - 42,336 2,220,368 - - - - S2S,783 - - - - 5,400 - - - - 15,747 - - 1,708,844 37,073 1,978,228 - - - 1,203,456 1,332,461 - - - 190,360 190,360 - 4,937,028 - - 5,037,028 - 2,133,312 - - 2,192,063 18,455 7,070,340 1,708,844 1,887,245 19,708,765 764,816 (4,861,979) (1,753,398) (89,119) (3,316,029) 203,708 14,117,459 1,409,566 1,020,264 16,818,090 (1,940,039) (10,899,801) (865,432) (577,457) (16,446,845) - - - - 2,S7S - - - - 74,650 - (15,908,564) - - (15,908,564) - (384,432) - - (384,432) - 1S,4S0,000 - - 15,450,000 (1,736,331) 2,374,662 544,134 442,807 (394,526) (971,S1S) (2,487,317) (1,209,264) 353,688 (3,710,SS5) 5,996,543 12,216,328 (630,214) 4,916,757 39,S58,S64 - (3S6,S37) - - _ (653,661) 5,996,543 11,859,791 (630,214) 4,916,757 38,904,903 $ 5,025,028 $ 9,372,474 $ (1,839,478) $ 5,270,445 $ 35,194,348 -18- CITY OF MONTICELLO Reconciliation of the Statement of Revenue, Expenditures, and Changes in Fund Balances to the Statement of Activities Governmental Activities Year Ended December 31, 2008 Total net change in fund balances -governmental funds Amounts reported for governmental activities in the Statement of Activities are different because: $ (3,710,555) Capital outlays are reported in governmental funds as expenditures. However, in the Statement of Activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense. This is the amount by which capital assets changed: Capital outlays 3,178,174 Depreciation expense (2,308,050) A gain or loss on the disposal of capital assets, including the difference between the carrying value and any related sale proceeds, is included in the change of net assets. However, only the sale proceeds are included in the change in fund balances. The governmental funds report bond proceeds as financing sources, while repayment of bond principal is reported as an expenditure. In the Statement of Net Assets, however, issuing debt increases long-term liabilities and does not affect the Statement of Activities: Proceeds from bonds issued Repayment of bond principal Repayment of note principal Repayment of contract for deed Change in accrued interest payable Deferred gain on bond refunding Net amortization of bond issuance Amortization of bond premium Change in compensated absences Net other post-employment benefit obligations payable reported in the Statement of Activities do not require the use of current financial resources and are not reported as expenditures in governmental funds until actually due. Certain revenues (including delinquent taxes and special assessments) are included in the change in net assets, but are excluded from the change in fund balances until they are available to liquidate liabilities of the current period. Change in deferred revenue Change in net assets -governmental activities See notes to basic financial statements (111,463) (15,450,000) 11,330,000 9,515,592 100,000 (39,205) 384,432 63,056 31,340 48,194 (53,680) (1,812,729) $ 1,165,106 -19- CITY OF MONTICELLO Statement of Net Assets Proprietary Funds as of December 31, 2008 Assets Current assets Cash and investments - unresVicted Receivables Deferred special assessments Delinquent special assessments Accounts Accrued interest Inventory Due from other funds Prepaids Total current assets Noncurrent assets Cash and investments - resVicted Capital assets Land Buildings Furniture and equipment Vehicles Machinery and equipment Improvements other than buildings Infrastructure Construction in progress Less accumulated depreciation Capital assets, net of depreciation Other assets Unamortized discounts and issuance costs Total assets Liabilities Current -iabilities Accounts and conVacts payable Other accrued liabilities Due to other governmental units Due to other funds Unamortized premiums Unearned revenue Escrow deposits Bonds payable due within one yeaz Total current liabilities Long-term liabilities Bonds payable Compensated absences payable Total long-term liabilities Total liabilities Net assets Invested in capital assets, net of related debt Restricted Unrestricted Total net assets See notes to basic financial statements Business-Type Activities -Enterprise Funds Water Sewer Liquor Cemetery Fiber Optics Totals $ 2,123,494 $ 1,871,893 $ 287,679 $ 39,342 $ - $ 4,322,408 . 151,844 - - - - 151,844 19,803 - - - - 19,803 181,739 356,479 9,985 - 60,192 608,395 20,059 21,927 16,777 424 (6,038) 53,149 - - 569,537 - - 569,537 - - 1,580,243 - - 1,580,243 6,950 7,555 13,509 - 2,107 , 30,121 2,503,889 2,257,854 2,477,730 39,766 56,261 7,335,500 - - - - 24,758,678 24,758,678 208,143 984,202 5,600 554,000 - 1,751,945 848,445 3,570,119 737,907 - - 5,156,471 15,695 52,942 49,736 - - 118,373 81,553 526,586 - - - , 608,139 166,267 567,836 64,251 - - 798,354 1,944,034 17,609,984 81,040 85,891 - 19,720,949 13,897,343 14,949,988 - - - 28,847,331 - 1,114,710 - - 1,871,394 2,986,104 17,161,480 39,376,367 938,534 639,891 1,871,394 59,987,666 (7,092,950) (19,512,058) (462,162) (22,751) - (27,089,921) 10,068,530 19,864,309 476,372 617,140 1,871,394 32,897,745 - - - - 1,084,492 1,084,492 $ 12,572,419 $ 22,122,163 $ 2,954,102 $ 656,906 $ 27,770,825 $ 66,076,415 $ 30,337 $ 186,358 $ 56,432 $ 800 $ 743,310 $ 1,017,237 4,967 2,661 11,502 65 - 19,195 2,572 - 38,690 - - 41,262 - - - - 1,580,243 1,580,243 - 12,928 - - - 12,928 , 71,809 - 1,384 - - 73,193 1,500 878 808 - - 2,883 - 69,026 - - - 69,026 111,185 271,848 108,516 868 2,323,553 2,815,967 ' - 838,071 - - 26,445,000 27,283,071 37,293 - 15,014 - - 52,307 37,293 838,071 15,014 - 26,445,000 ' 27,335,378 148,478 1,109,919 123,530 868 28,768,553 30,151,345 10,068,530 18,944,284 476,372 617,140 1,269,564 31,375,890 - - - 19,350 - 19,350 2,355,411 2,067,960 2,354,200 19,551 (2,267,292) 4,529,830 $ 12,423,941 $ 21,012,244 $ 2,830,572 $ 656,041 $ (997,728) $ 35,925,070 -20- i i CITY OF MONTICELLO Statement of Revenue, Expenses, and Ch anges in Fund Ne t Assets ' Proprietary Fund s Year Ended December 31, 2008 Business-Ty pe Activities -Enterprise Funds Water Sewer Liquor Cemetery Fiber Optics Totals ' Operating revenue Sales - $ - $ $ 4,085,682 $ - $ - $ 4,085,682 Cost of goods sold - - (3,026,203) - - (3,026,203) Changes for services 973,776 1,307,064 - 24,475 - 2,305,315 Other revenue 18,656 31,135 2,999 2,308 81,258 136,356 Total operating revenue 992,432 1,338,199 1,062,478 26,783 81,258 3,501,150 Operating expenses Personal services 240,259 167,108 374,610 5,338 - 787,315 Utilities 102,552 16,110 26,894 - 330 145,886 Supplies and maintenance 116,839 15,002 9,945 - 471 142,257 Repairs and maintenance 33,752 18,668 15,152 92 1,612 69,276 Depreciation 422,634 1,007,336 45,811 3,436 1,479,217 Insurance 13,144 24,707 30,781 - 3,200 71,832 Professional fees 5,632 792,058 12,713 20,401 777,075 1,607,879 Advertising - - 1,960 - 1,960 Miscellaneous 41,034 24,371 102,877 = 1,160 169,442 Total operating expenses 975,846 2,065,360 620,743 29,267 783,848 4,475,064 ' Operating income (loss) 16,586 (727,161) 441,735 (2,484) (702,590) (973,914) Nonoperating revenues (expenses) Investment earnings (charges) 97,283 106,819 82,710 2,024 258,867 547,703 ' Interest expense - (20,125) - - (806,389) (826,514) Total nonoperating revenues (expenses) 97,283 86,694 82,710 2,024 (547,522) (278,811) Income (loss) before contributions and transfers 113,869 (640,467) 524,445 (460) (1,250,112) (1,252,725) Contributions and transfers Capital contributions = 15,413 91,374 106,787 Transfers in 21,561 = = 21,561 Transfers (out) (221 187 (171,619) - (392,806) Total contributions and transfers (221,187) 36,974 (171,619) - 91,374 (264,458) Change in net assets (107,318) (603,493) 352,826 (460) (1,158,738) (1,517,183) Net assets Beginning of year, as previously reported 14,445,319 23,464,837 2,464,958 122,401 (84,894) 40,412,621 Prior period adjustment (1,914,060) (1,849,100) 12,788 534,100 245,904 (2,970,368) Beginning of year, as restated 12,531,259 21,615,737 2,477,746 656,501 161,010 37,442,253 End of year $ 12,423,941 $ 21,012,244 $ 2,830,572 $ 656,041 $ (997,728) $ 35,925,070 See notes to basic financial statements -21- CITY OF MONTICELLO Statement of Cash Flows Proprietary Funds ' Year Ended December 31, 2008 Business-Typ e Activities -Enterprise Funds f Water Sewer Liquor Cemetery Fiber Optics Totals Cash flows from operating activities Cash received from customers $ 966,240 $ 1,300,204 $ 1,059,934 $ 26,054 $ 21,066 $ 3,373,498 Cash payments to suppliers (399,457) (867,447) (303,134 (19,694) (99,842) (1,689,574) Cash payments to employees (167,599) (117,295) (309,539) (5,332) - (599,765) Net cash provided (used) by operating activities 399,184 315,462 447,261 1,028 (78,776) 1,084,159 Cash flows from noncapital financing activities Interfund borrowing (1,552,546) - - - 1,580,243 27,697 Transfers in (out) (221,187) 21,561 (171,619) - - (371,245) Net cash provided (used) by noncapital financing activities (1,773,733) 21,561 (171,619) - 1,580,243 (343,548) Cash flows from capital and related financing activities Acquisition and construction of capital assets - (813,813) - - (1,534, 116) (2,347,929) Proceeds from sale of bonds - - - - 25,332,811 25,332,811 Interest received on investments 91,670 97,827 78,037 1,942 264,905 534,381 Interest paid on bonds - (21,561) - - (806,389) (827,950) Net cash provided (used) by capital and related financing activities 91,670 (737,547) 78,037 1,942 23,257,211 22,691,313 Net increase (decrease) in cash and cash equivalents (1,282,879) (400,524) 353,679 2,970 24,758,678 23,431,924 Cash and cash equivalents Beginning of year 1,826,130 2,272,417 1,514,243 36,372 - 5,649,162 End of year $ 543,251 $ 1,871,893 $ 1,867,922 $ 39,342 $ 24,758,678 $ 29,081,086 Cash and cash equivalents comprised of Unrestricted $ 543,251 $ 1,871,893 $ 1,867,922 $ 39,342 $ - $ 4,322,408 Restricted - - - - 24,758,678 24,758,678 Total $ 543,251 $ 1,871,893 $ 1,867,922 $ 39,342 $ 24,758,678 $ 29,081,086 Reconciliation of operating income (loss) to net cash provided (used) by operating activities Operating income (loss) $ 16,586 $ (727,161) $ 441,735 $ (2,484) $ (702,590) $ (973,914) Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities Depreciation 422,634 1,007,336 45,811 3,436 - 1,479,217 Changes in assets and liabilities (Increase) decrease in accounts receivable (22,660) (37,993) (2,621) 880 (60,192) (122,586) (Increase) decrease in special assessments receivable 14,643 - - - - 14,643 (Increase) decrease in inventory - - 82,704 - - 82,704 (Increase) decrease in prepaid expenses 2,466 (1,654) (4,701) - (2,107) (5,996) Increase (decrease)in accounts and contracts payable 6,591 74,100 (55,494) 800 686,113 712,110 Increase (decrease)in accrued expenses (6,350) 968 (62,109) 5 - (67,486) Increase (decrease)in due to other governments (16,552) (134) 1,859 - - (14,827) Increase (decrease) in unearned revenue (18,044) - 84 - - 17,960 ( Increase (decrease)in escrow deposits (130) - (7) (1,609) - (1,746) Net cash provided (used) by operating activities $ 399,184 $ 315,462 $ 447,261 $ 1,028 $ (78,776) $ 1,084,159 Noncash capital and related financing activities Contributions of capital assets $ - $ 15,413 $ - $ - $ 91,374 $ 106,787 See notes to basic financial statements -22- CITY OF MONTICELLO Notes to Basic Financial Statements December 31, 2008 NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Organization The financial statements of the City of Monticello, Minnesota (the City) have been prepared in conformity with accounting principles generally accepted in the United States of America as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The significant accounting policies of the City are described as follows: B. Reporting Entity The accompanying financial statements include all funds, departments, agencies, boards, commissions, and other organizations that comprise the City, along with any component units. Component units are legally separate entities for which the City (primary government) is financially accountable, or for which the exclusion of the component unit would render the financial statements of the primary government misleading. The criteria used to determine if the primary government is financially accountable for a component unit includes whether or not the primary government appoints the voting majority of the potential component unit's governing body, is able to impose its will on the potential component unit, is in a relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon by the potential component unit. The Monticello Economic Development Authority (EDA) is fiscally dependent upon the City, and its governing body consists of City Council members. Therefore, the EDA is included as a component unit of the City. The EDA's financial data has been blended with that of the City (i.e. reported as though its funds were funds of the City) and reported as a special revenue fund. C. Government-Wide Financial Statement Presentation The government-wide financial statements (Statement of Net Assets and Statement of Activities) display information about the reporting government as a whole. These statements include all of the financial activities of the City. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The City's net assets are reported in three parts: 1) invested in capital assets, net of related debt; 2) restricted net assets; and 3) unrestricted net assets. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include: 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment; 2) operating grants and contributions; and 3) capital grants and contributions, including special assessments that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other internally directed revenues are reported as general revenues. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes and special assessments are recognized as revenues in the fiscal year for which they are levied. Grants and similar items are recognized as revenue when all eligibility requirements imposed by the provider have been met. -23- NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Generally, the effect of interfund activity has been removed from the government-wide financial statements. However, charges between functions for certain interfund services provided are not eliminated, as that would distort the direct costs and program revenues reported in those functions. The City applies restricted resources first when an expense is incurred for which both restricted and unrestricted resources are available. Depreciation expense is included in the direct expenses of each function. Interest on long-term debt is considered an indirect expense and is reported separately on the Statement of Activities. D. Fund Financial Statement Presentation Separate fund financial statements are provided for governmental and proprietary funds. Major individual governmental and enterprise funds are reported as separate columns in the fund financial statements. Aggregated information for the remaining nonmajor funds are reported in single columns in the respective fund financial statements. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the City's enterprise funds are charges to customers for sales and services. The operating expenses for the enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. Governmental funds financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this basis of accounting transactions are recorded in the following manner: 1. Revenue Recognition -Revenue is recognized when it becomes measurable and available. "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal year. Grants and similar items are recognized when all eligibility requirements imposed by the provider have been met. Major revenue that is susceptible to accrual includes property taxes, intergovernmental revenue, charges for services, and interest earned on investments. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. Major revenue that is not susceptible to accrual includes licenses and permits, fees, and miscellaneous revenue. Such revenue is recorded only when received because it is not measurable until collected. 2. Recording of Expenditures -Expenditures are generally recorded when a liability is incurred, except for principal and interest on long-term debt and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as capital outlay expenditures in the governmental funds. Proceeds of long-term debt are reported as other financing sources. Proprietary funds fmancial statements are reported using the economic resources measurement focus and the accrual basis of accounting as described earlier in these notes. Private sector standards of accounting and financial reporting issued prior to December 1, 1989 are generally followed in both the government-wide and proprietary funds financial statements to the extent those standards do not conflict with or contradict guidance of GASB. Governments have the option of following subsequent private sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The City has elected not to follow subsequent private sector guidance. -24- NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Description of Funds Each fund is accounted for as an independent entity as follows: A description of the funds included in this report is Major Governmental Funds General Fund -The General Fund is used to account for all financial resources except those required to be accounted for in another fund. Community Center Fund -The Community Center Fund accounts for the revenues and expenditures related to the community center. Capital Outlay Revolving Fund -The Capital Outlay Revolving Fund is used to account for the revenues and expenditures related to capital outlay. Economic Development Authority (EDA) Fund -The EDA Fund is used to account for revenues and expenditures related to the blended component unit. Sanitary Sewer Access Fund -The Sanitary Sewer Access Fund is used to account for revenues and expenditures related to sanitary sewer connections. Debt Service Fund -Debt service funds are used to account for the accumulation of resources for and the payment of long-term debt principal, interest, and related costs. Capital Projects Fund -The Capital Projects Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds). Major Proprietary Funds Water Fund -The Water Enterprise Fund is used to account for all activities necessary to provide water services to the residents and businesses of the City. Sewer Fund -The Sewer Enterprise Fund is used to account for all activities necessary to provide sewer services to the residents and businesses of the City. Liquor Fund -The Liquor Fund is used to account for the operations of the City's liquor store. Cemetery Fund -The Cemetery Fund is used to account for the operation of City's cemetery. Fiber Optics Fund -The Fiber Optics Fund is used to account for all activities necessary to provide fiber optic services to the residents and businesses of the City. E. Cash and Investments Cash and investments include balances from all funds that are combined and invested to the extent available in savings accounts, certificates of deposit, U.S. government obligations, and other securities authorized by state statutes. Earnings from investments are allocated to the respective funds on the basis of applicable participation by each fund. Short-term highly liquid debt instruments (including commercial paper, banker's acceptances, and U.S. treasury and agency obligations) purchased with a remaining maturity of one year or less are reported at amortized cost. Other investments are reported at fair value. -25- NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Receivables and Payables Any outstanding balances between funds that are not lending or borrowing arrangements are reported as "due to/from other funds." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances." When necessary, the City utilizes an allowance for uncollectible accounts to value its receivables. However, the City considers all of its current receivables to be collectible. G. Notes Receivable Notes receivable consist primarily of loans made by the City to area businesses for development or redevelopment purposes. The terms and interest rates of the individual loans vary. The notes receivable in the governmental funds are not offset by deferred revenue. The City has one note receivable totaling $1,600,000 with another local government. This note has an interest rate of 3.95 percent and will mature at various dates through January 2016. This note receivable in the governmental funds is offset by deferred revenue. H. Property Taxes Property tax levies are set by the City Council each year, and are certified to Wright County for collection in the following year. In Minnesota, counties act as collection agents for all property taxes. A portion of the properly taxes levied is paid by the state of Minnesota through various tax credits, which are included in intergovernmental revenue in the financial statements. Wright County spreads all levies over taxable property. Such taxes become a lien on January 1 and are recorded as receivables by the City on that date. Property taxes may be paid by taxpayers in two equal installments on May 15 and October 15. Wright County provides tax settlements to cities and other taxing districts several times throughout the year. Taxes which remain unpaid at December 31 are classified as delinquent taxes receivable and are offset by deferred revenue in the governmental funds financial statements. Within the governmental funds financial statements, the City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current period. The portion of delinquent taxes not collected by the City in January is fully offset by deferred revenue because it is not available to finance current expenditures. Deferred revenue in governmental activities is susceptible to full accrual on the government-wide statements. I. Special Assessments Special assessments represent the financing for public improvements paid for by benefiting property owners. These assessments are recorded as delinquent (levied, but unremitted) and deferred (certified, but not yet levied) special assessments receivable, and are offset by deferred revenue in the governmental fund financial statements. J. Inventories The inventories of the proprietary funds are stated at cost on the first-in, first-out basis. -26- NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. Prepaid Items Payments to vendors for services that will benefit future accounting periods are recorded as prepaid. Prepaid items are accounted for using the consumption method. L. Land Held for Resale Land held for resale is recorded in the governmental fund which purchased it at the lower of cost or market. Fund balance is reserved in an amount equal to the land's carrying value as the related funds are not available for appropriation. M. Capital Assets Capital assets, which include property, plant, equipment, and infrastructure assets (roads, bridges, sidewalks, and similar items) are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Such assets are capitalized at historical cost, or estimated historical cost for assets where actual historical cost is not available. Donated assets are recorded as capital assets at their estimated fair market value at the date of donation. The City maintains a threshold level of $5,000 or more for capitalizing capital assets. The cost of normal maintenance and repairs that does not add to the value of the asset or materially extend asset lives is not capitalized. The City has elected to retroactively capitalize the infrastructure capital assets of its governmental activities. Capital assets are recorded in the government-wide and proprietary funds financial statements, but are not reported in the governmental funds financial statements. Interest incurred during the construction phase of capital assets for business-type activities is included as part of the capitalized value of the assets constructed. Capital assets are depreciated using the straight-line method over their estimated useful lives. Since surplus assets are generally sold for an immaterial amount when declared as no longer needed for city purposes, no salvage value is taken into consideration for depreciation purposes. Useful lives vary from 10 to 40 years for infrastructure; 5 to 20 years for vehicles, machinery, and furniture and equipment; 12 to 40 years for buildings; and 10 to 20 years for improvements other than buildings. Capital assets not being depreciated include land and construction in progress. N. Long-Term Liabilities In the government-wide and proprietary funds financial statements, long-term debt and other long-term obligations are reported as liabilities. Bond premiums and discounts, if material, are deferred and amortized over the life of the bonds using the straight-line method. Bond issuance costs, if material, are also reported as deferred charges and amortized over the term of the related debt. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. -27- NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) O. Compensated Absences Payable City employees earn vacation days based upon the number of completed years of service. The City compensates employees for unused vacation upon termination of employment. Employees are entitled to paid sick leave at various rates for each month of full-time service. Full-time employees who resign or leave city employment voluntarily and in good standing, after giving proper notice, shall be compensated for up to 50 days of unused sick leave under the following guidelines: For union employees, one-fourth of the unused sick leave times the hourly rate at the time of giving notice is paid. After five years of non-union employment, one-fourth of the unused sick leave times the hourly rate at the time of giving notice is paid. After 10 years of employment, all employees accrue one-half of the unused sick leave, times the hourly rate at the time of giving notice. Compensated absences payable are paid by the respective fund in which the employee is employed. P. Budget Budgets for the General Fund and certain special revenue funds are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Reported budget amounts are as originally adopted or as amended by City Council-approved supplemental appropriations and budget transfers. No supplemental budget amendments were adopted during the year. Budget appropriations lapse at year-end. Q. Risk Management The City is exposed to various risks of loss related to torts: theft of, damage to, or destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City manages these various risks of loss as follows: The City participates in the League of Minnesota Cities Insurance Trust (LMCIT) property and liability insurance program, a joint self-insurance plan designed and administered by American Business Risk Services and structured to operate through local insurance agents. Approximately 140 cities currently participate in the program. The City has the following coverage with LMCIT: a basic package of property, inland marine, automotive physical damage and liability; comprehensive general liability; public officials errors and omissions; umbrella liability; boiler and machinery; and workers' compensation. The City pays an annual premium to LMCIT, which in turn pays the local agent's commission and pays an administrative fee to American Business Risk Services. The remaining premium is split between LMCIT and its reinsurers. The reinsurers in turn reimburse LMCIT for a corresponding share of each loss. A profit sharing agreement also provides for a return to LMCIT of a share of the reinsurers' portion of the premium if the loss experience is favorable. To protect against the possibility that LMCIT's share of the losses will exceed its share of the premium, LMCIT also purchases aggregate reinsurance. The loss experience has been favorable the last three years and the City has received a return of part of the premiums paid. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three calendar years. There were no reductions in coverage from the prior year. -28- NOT - E 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) ' R. Statement of Cash Flows For purposes of the Statement of Cash Flows, the City considers all highly liquid debt instruments with an ' original maturity from the time of purchase by the City of three months or less to be cash equivalents. The proprietary fund's equity in the government-wide cash and investment management pool is considered to be cash equivalent. S. Net Assets and Fund Balance ' Net assets represent the difference between assets and liabilities in the government-wide financial statements. Net assets invested in capital assets, net of related debt, consists of capital assets, net of accumulated depreciation, reduced by the outstanding balance of any long-term debt used to build or ' acquire the capital assets. Net assets are reported as restricted in the government-wide financial statements when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, or laws or regulations of other governments. In the governmental fund financial statements, reservations of fund balance represent those portions of fund balance not appropriable for expenditure or legally segregated for a specific future use. Designated ~ fund balances represent tentative plans for future use of financial resources. NOTE 2 -CASH AND INVESTMENTS A. Components of Cash and Investments Cash and investments at year-end consist of the following: Deposits Investments Cash on hand Total cash and investments -Statement of Net Assets Cash and investments are reflected on the Statement of Net Assets as follows: Cash and investments -Statement of Net Assets Cash and investments -restricted -Statement of Fiduciary Net Assets Total B. Deposits $ 4,591,732 55,334,182 9,150 $ 59,935,064 $ 35,176,386 24,758,678 $ 59,935,064 In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks authorized by the City Council, including checking accounts and non-negotiable certificates of deposit. -29- NOTE 2 -CASH AND INVESTMENTS (CONTINUED) The following is considered the most significant risk associated with deposits: Custodial Credit Risk - In the case of deposits, this is the risk that in the event of a bank failure, the City's deposits may be lost. Minnesota Statutes require that all deposits be protected by federal deposit insurance, corporate surety bond, or collateral. The market value of collateral pledged must equal 110 percent of the deposits not covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes treasury bills, notes, and bonds; issues of U.S. government agencies; general obligations rated "A" or better; revenue obligations rated "AA" or better; irrevocable standard letters of credit issued by the Federal Home Loan Bank; and certificates of deposit. Minnesota Statutes require that securities pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account at a trust department of a commercial bank or other financial institution that is not owned or controlled by the financial institution furnishing the collateral. The City has no additional deposit policies addressing custodial credit risk. At year-end, the carrying amount of the City's deposits was $4,591,732 while the balance on the bank records was $4,808,278. At December 31, 2008, all deposits were fully covered by federal depository insurance, surety bonds, or by collateral held by the City's agent in the City's name. C. Investments The City has the following investments at year-end: Credit Risk Interest Risk -Maturi ty Duration in Years Investment Type Rating Agency Less Than 1 1 to 5 5 to 10 More Than 10 Total U.S. agency securities AAA S&P $ 27,160,620 $ 2,011,508 $ 5,570,597 $ 11,725,290 $ 46,468,015 Negotiable certificates of deposit N/R N/R 299,034 738,734 - - 1,037,768 Repurchase agreement N/R N/R 412,869 - - - 412,869 Money market funds AAA S&P 7,363,473 - - - 7,363,473 4M Fund N/R N/R 52,057 - - 52,057 Total investments $ 35,288,053 $ 2,750,242 $ 5,570,597 $ 11,725,290 $ 55,334,182 N/R -Not Rated Investments are subject to various risks, the following of which are considered the most significant: Custodial Credit Risk -For investments, this is the risk that in the event of a failure of the counterparty to an investment transaction (typically abroker-dealer) the City would not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The City does not have a formal investment policy addressing this risk, but typically limits its exposure by purchasing insured or registered investments, or by the control of who holds the securities. -30- NOTE 2 -CASH AND INVESTMENTS (CONTINUED) Credit Risk -This is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Minnesota Statutes limit the City's investments to direct obligations or obligations guaranteed by the United States or its agencies; shares of investment companies registered under the Federal Investment Company Act of 1940 that receive the highest credit rating, are rated in one of the two highest rating categories by a statistical rating agency, and all of the investments have a final maturity of 13 months or less; general obligations rated "A" or better; revenue obligations rated "AA" or better; general obligations of the Minnesota Housing Finance Agency rated "A" or better; bankers' acceptances of United States banks eligible for purchase by the Federal Reserve System; commercial paper issued by United States corporations or their Canadian subsidiaries, rated of the highest quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less; Guaranteed Investment Contracts guaranteed by a United States commercial bank, domestic branch of a foreign bank, or a United States insurance company, and with a credit quality in one of the top two highest categories; repurchase or reverse purchase agreements and securities lending agreements with financial institutions qualified as a "depository" by the government entity, with banks that are members of the Federal Reserve System with capitalization exceeding $10,000,000; that are a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York; or certain Minnesota securities broker-dealers. The City does not have an investment policy that further addresses credit risk. Concentration Risk -This is the risk associated with investing a significant portion of the City's investment (considered 5 percent or more) in the securities of a single issuer, excluding U.S. guaranteed investments (such as treasuries), investment pools, and mutual funds. The City does not have an investment policy that addresses the duration of investment limits on the amount that it may be invested in any one issuer. More than 5 percent of the City's investments are in Federal Home Loan Association, Federal National Mortgage Association, Federal Farm Credit Bureau, and Federal Home Loan Mortgage Corporation. These investments are 34 percent, 11 percent, 7 percent, and 16 percent, respectively, of the City's total investments. Interest Rate Risk -This is the risk of potential variability in the fair value of fixed rate investments resulting from changes in interest rates (the longer the period for which an interest rate is fixed, the greater the risk). The City does not have an investment policy that addresses the duration of investments. The Minnesota Municipal Money Market Fund (4M Fund) is a common law trust organized in accordance with the Minnesota Joint Powers Act, which invests only in investment instruments allowable under Minnesota Statutes. Its investments are valued at amortized cost, which approximates fair value in accordance with Rule 2a-7 of the Investment Company Act of 1940. The 4M Fund does not hive its own credit rating. MBIA, Inc., who administers the 4M Fund, holds an organization credit rating of Aa2. -31- NOTE 3 -CAPITAL ASSETS Capital asset activity for the year ended December 31, 2008 was as follows: A. Governmental Activities Balance - Balance - (See Note 12) Beginning Beginning Prior Period of Year Completed Balance - of Yeaz Adjustment as Restated Additions Deletions Construction End of Year Capital assets, not depreciated Land $ 7,162,826 $ 88,867 $ 7,251,693 $ 1,205,791 $ - $ - $ 8,457,484 Construction in progress 24,927,847 8,867,555 33,795,402 1,586,354 - (1,929,859) 33,451,897 Capital assets, depreciated Buildings 13,135,936 - 13,135,936 11,616 (117,450) 72,111 13,102,213 Furniture and equipment 301,991 - 301,991 33,402 - - 335,393 Vehicles 1,879,681 - 1,879,681 181,016 (18,373) - 2,042,324 Machinery and equipment 1,085,194 - 1,085,194 159,995 (5,450) - 1,239,739 Improvements other than buildings 4,115,256 98,724 4,213,980 - - 117,811 4,331,791 Infrastructure 35,043,517 - 35,043,517 - - 1,739,937 36,783,454 Total capital assets 87,652,248 9,055,146 96,707,394 3,178,174 (141,273) - 99,744,295 Less accumulated depreciation on Buildings (3,193,024) - (3,193,024) (336,601) 5,987 - (3,523,638) Vehicles (1,389,769) - (1,389,769 (126,727) 18,373 - (1,498,123) Machinery and equipment (623,716) - (623,716) (102,361) 5,450 - (720,627) Furniture and equipment (130,630) - (130,630) (29,942) - - (160,572) Infrastructure (15,422,157) - (15,422,157) (1,566,299) - _ (16,988,456) Improvements other than buildings (2,037,782) - (2,037,782) (146,120) - (2,183,902) Total accumulated depreciation (22,797,078) - (22,797,078) (2,308,050) 29,810 (25,075,318) Net capital assets $ 64,855,170 $ 9,055,146 $ 73,910,316 $ 870,124 $ (111,463) $ $ 74,668,977 B. Business-Type Activities Capital assets, not depreciated Land Construction in progress Capital assets, depreciated Buildings Furniture and equipment Vehicles Machinery and equipment Improvements other than buildings Infrastructure Total capital assets Less accumulated depreciation on Buildings Vehicles Machinery and equipment Fumiture and equipment Infrastructure Improvements other than buildings Total accumulated depreciation Net capital assets Balance - Balance - (See Note 12) Beginning Beginning Prior Period of Year Completed Balance - ofYear Adjustment as Restated Additions Construction End of Year $ 1,217,845 $ 534,100 $ 1,751,945 $ - $ - $ 1,751,945 6,191,216 (3,537,153) 2,654,063 2,323,408 (1,991,367) 2,986,104 5,156,471 - .5,156,471 - - 5,156,471 93,663 12,788 106,451 11,922 - 118,373 561,166 - 561,166 46,973 - 608,139 725,943 - 725,943 72,411 - 798,354 18,056,314 40,030 18,096,344 - 1,624,605 19,720,949 28,510,509 (29,940) 28,480,569 - 366,762 28,847,331 60,513,127 (2,980,175) 57,532,952 2,454,714 - 59,987,666 (2,333,581) - (549,393) - (558,534) - (60,639) - (12,248,026) 9,808 (2,333,581) (549,393) (558,534) (60,639) (12,238,218) (153,226) (9,067) (32,179) (17,045) (834,357) - (2,486,807) - (558,460) - (590,713) - (77,684) - (13,072,575) (9,870,342) - (9,870,342) (433,340) - (10,303,682) (25,620,515) 9,808 (25,610,707) (1,479,214) - (27,089,921) $ 34,892,612 $ (2,970,367) $ 31,922,245 $ 975,500 $ - $ 32,897,745 -32- NOTE 3 -CAPITAL ASSETS (CONTINUED) C. Depreciation Depreciation expense for the year ended December 31, 2008 was charged to the following functions: Governmental activities General government $ 24 818 Public safety 56,389 Public works 1,782,275 Culture and recreation 440,577 Economic development 3,991 Total depreciation expense -governmental activities $ 2,308,050 Business-type activities: Water $ 422,633 Sewer 1,007,335 Liquor 45,811 Cemetery 3 43 5 Total depreciation expense -business-type activities $ 1,479,214 NOTE 4 -LONG-TERM LIABILITIES A. Description The City has the following types of long-term liabilities outstanding at December 31, 2008: special assessment improvement bonds with governmental commitment, tax increment bonds, general obligation bonds and notes, revenue bonds, and contracts for deed. Special assessment bonds are payable primarily from special assessments. Tax increment bonds are payable primarily from tax increments. General obligation bonds, notes, and contracts for deed are payable solely from general property taxes. Revenue bonds are payable from enterprise fund revenue. Any deficiency in funding for the repayment of special assessment or tax increment bonds would be provided for by general property taxes. -33- NOTE 4 -LONG-TERM LIABILITIES (CONTINUED) Long-term liabilities at year-end are summarized as follows: Final Balance - OriQinal Issue Interest Rate Issue Date Maturity Date End of Yeaz Governmental activities General obligation bonds 2003A Improvement Bonds $ 2,420,000 2.00-4.00% 09/01/2003 02/01/2015 $ 1,770,000 2007 Improvement Bonds $ 5,137,903 4.00% 12/27/2007 02/01/2018 5,137,903 2008A Sewer Revenue Refunding Bond $ 9,270,000 3.40% 04/17/2008 08/01/2018 8,830,000 Tax increment bonds 2004A Tax Increment Bonds $ 945,000 3.00-5.60% 06/30/2004 02/01/2013 575,000 Special assessments bonds 2002 Improvement Bonds $ 2,420,000 1.70-4.00% 2005 General Obligation Improvement Bonds $ 25,150,000 4.00-4.75% Revenue bonds 2008A Public Project Revenue Refunding Bonds $ 6,180,000 Contract for deed $ 2,185,222 Total governmental activity long-term liabilities Business-type activities General obligation bonds 2007 Improvement Bonds $ 907,097 Revenue bonds 12/30/2002 02/01/2014 1,365,000 08/17/2005 02/01/2023 22,710,000 3.20% 02/20/2008 02/01/2015 6,180,000 6.00% 12/22/2004 12/01/2009 564,293 $ 47,132,196 4.00% 12/27/2007 02/01/2018 $ 907,097 2008 Telecommunications Revenue Bonds $ 26,445,000 6.50.75% 06/05/2008 06/01/2031 26,445,000 Total business-type activity long-term liabilities $ 27,352,097 -34- NOTE 4 -LONG-TERM LIABILITIES (CONTINUED) B. Minimum Debt Payments Minimum annual principal and interest payments to maturity for bonds payable are as follows: Governmental Activities: Year Ending December 31, Principal Interest 2009 $ 6,750,267 $ 1,728,312 2010 4,640,966 1,504,554 2011 5,079,964 1,303,178 2012 5,154,467 1,095,037 2013 5,295,716 885,080 2014-2018 18,095, 816 1,901, 812 2019-2023 2,115,000 232,156 $ 47,132,196 $ 8,650,129 Business-Type Activities: Year Ending December 31, Principal Interest 2009 $ 69,026 $ 905,585 2010 90,034 1,797,060 2011 93,036 1,793,398 2012 85,533 1,789,827 2013 174,284 1,786,331 2014-2018 2,870,184 8,607,501 2019-2023 5,405,000 7,410,013 2024-2028 9,225,000 5,143,163 2029-2031 9,340,000 1,371,598 $ 27,352,097 $ 30,604,476 C. Current Refunding In 2008, the City issued $9,270,000 of General Obligation Sewer Revenue Refunding Bonds, Series 2008A. These bonds were issued to refund in advance of their stated maturities the General Obligation Wastewater Treatment Note, Series 1997 totaling $9,168,564. The refunding was undertaken to provide a cash flow savings of $342,852 and a net present value savings on debt service payments of $270,404. D. Current Refunding In 2008, the City's EDA issued $6,180,000 of Public Project Revenue Refunding Bonds, Series 2008A. These bonds were issued to refund in advance of their stated maturities the Public Project Revenue Bonds, Series 2000A totaling $6,124,432. The refunding was undertaken to provide a cash flow savings of $286,247 and a net present value savings on debt service payments of $258,569. -35- NOTE 4 -LONG-TERM LIABILITIES (CONTINUED) E. Changes in Long-Term Liabilities December 31, December 31, Due Within 2007 Additions Retirements 2008 One Year Governmental activities General obligation bonds $ 7,132,903 $ 9,270,000 $ 665,000 $ 15,737,903 $ 2,160,974 Tax increment bonds 680,000 - 105,000 575,000 105,000 Special assessment bonds 28,415,000 - 4,340,000 24,075,000 2,540,000 General obligation notes 9,515,592 - 9,515,592 - 755,000 Revenue bonds 6,220,000 6,180,000 6,220,000 6,180,000 625,000 Contracts for deed 664,293 - 100,000 564,293 564,293 Compensated absences 342,531 - 48,194 294,337 76,645 Total $ 52,970,319 $ 15,450,000 $ 20,993,786 $ 47,426,533 $ 6,826,912 Business-type activities General obligation bonds $ 907,097 $ - $ - $ 907,097 $ 69,026 Revenue bonds - 26,445,000 - 26,445,000 - Compensated absences 104,352 - 52,045 52,307 12,472 Total $ 1,011,449 $ 26,445,000 $ 52,045 $ 27,404,404 $ 81,498 F. Conduit Debt The City has issued Senior Housing Refunding Revenue Bonds to provide financial assistance to private sector entities for the acquisition and construction of senior housing facilities deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Upon repayment of the bonds, ownership of the acquired facilities transfers to the private sector entity served by the bond issuance. The City is not obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December 31, 2008, there was one series of Senior Housing Refunding Revenue Bonds outstanding. The original issue amounts totaled $3,000,000 with an interest rate of 4.75 percent maturing on October 1, 2012. This balance has been reduced through annual payments and partial call prepayments. The outstanding balance as of December 31, 2008 is undetermined. NOTE 5 -DEFINED BENEFIT PENSION PLANS -STATE-WIDE A. Plan Description All full-time and certain part-time employees of the City are covered by defined benefit plans administered by the Public Employees' Retirement Association (PERA) of Minnesota. PERA administers the Public Employees' Retirement Fund (PEKE) and the Public Employees' Police and Fire Fund (PEPFF), which are cost-sharing, multiple-employer retirement plans. These plans are established and administered in accordance with Minnesota Statutes, Chapters 353 and 356. PERF members belong to either the Coordinated or Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. All police officers, firefighters, and peace officers who qualify for membership by statute are covered by PEPFF. PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible members. Benefits are established by state statute, and vest after three years of credited service. The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. -36- NOTE 5 -DEFINED BENEFIT PENSION PLANS -STATE-WIDE Two methods are used to compute benefits for PERF's Coordinated and Basic Plan members. The retiring member receives the higher of a step-rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member is 2.2 percent of average salary for each of the first 10 years of service and 2.7 percent for each remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2 percent of average salary for each of the first 10 years of service and 1.7 percent for each remaining year. Under Method 2, the annuity accrual rate is 2.7 percent of average salary for Basic Plan members and 1.7 percent for Coordinated Plan members for each year of service. For PEPFF members, the annuity accrual rate is 3 percent for each year of service. For all PEPFF members and for PERF members hired prior to July 1, 1989 whose annuity is calculated using Method 1, a full annuity is available when age plus years of service equal 90. Normal retirement age is 55 for PEPFF members, and 65 for PERF Basic and Coordinated Plan members hired prior to July 1, 1989. Normal retirement age is the age for unreduced Social Security benefits capped at 66 for Coordinated Plan members hired on or after July 1, 1989. A reduced retirement annuity is also available to eligible members seeking early retirement. There are different types of annuities available to members upon retirement. A single-life annuity is a lifetime annuity that ceases upon the death of the retiree-no survivor annuity is payable. There are also various types of joint and survivor annuity options available which will be payable over joint lives. Members may also leave their contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin. The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees who are entitled to benefits, but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF and PEPFF. That report may be obtained on the web at mnpera.org; by writing to PERA at Public Employees' Retirement Association, Retirement Systems of Minnesota Building, 60 Empire Drive, Suite 200, St. Paul, Minnesota 55103-2088; or by calling (651) 296-7460 or (800) 652-9026. B. Funding Policy Minnesota Statute, Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the State Legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. PERF Basic and Coordinated Plan members were required to contribute 9.1 percent and 6.0 percent, respectively, of their annual covered salary in 2008. PEPFF members were required to contribute 8.6 percent of their annual covered salary in 2008. That rate will increase to 9.4 percent in 2009. The City was required to contribute the following percentages of annual covered payroll in 2008: 11.78 percent for Basic Plan PERF members, 6.5 percent for Coordinated Plan PERF members, and 12.9 percent for PEPFF members. Employer contribution rates for the Coordinated Plan and PEPFF will increase to 6.75 percent and 14.1 percent, respectively, effective January 1, 2009. The City's contributions for the years ending December 31, 2008, 2007, and 2006 were $194,943, $178,303, and $161,068, respectively. The City's contributions were equal to the contractually required contributions for each year as set by state statutes. -37- NOTE 6 -CITY OF MONTICELLO FIRE RELIEF ASSOCIATION A. Plan Description The City contributes to the City of Monticello Fire Relief Association (the Association), a single employer retirement system that acts as a common investment manager and administrator for the City's firefighters. All active members of the fire department are members of the Association. The Association issues a publicly available financial report that includes financial statements and required supplementary information. A copy of the report may be obtained at Monticello City Hall. Upon approval by the Board of Trustees, lump sum retirement benefits are either paid or deferred as follows: 1. Benefits accrue and vest to members based on $3,950 per year of active service in the fire department and Association with 100 percent vesting at 20 years. 2. Members retiring with less than 10 years of service forfeit their accrued benefits. 3. Members who separate from service and have at least 10 years of active service and membership, but are less than 50 years of age, are entitled to a deferred service pension payable upon reaching the age of 50. 4. The Association also provides death benefits, whereby upon approval of application, the beneficiaries of each deceased active member would receive $3,950 per year of service. B. Funding Policy Minnesota Statutes § 69.772 sets the minimum contribution requirement for the City on an annual basis, including state aid passed through the City. These statutes are established and amended by the State Legislature. The Association is comprised of volunteers, and no member contribution is required. C. Annual Pension Cost and Net Pension Obligation The City's annual pension cost and net pension obligation to the Association for the year ended December 31, 2008 is as follows: Annual required contribution Interest on net pension obligation Adjustment to annual required contribution Annual pension cost Less contribution made Increase (decrease) in net pension obligation Net pension obligation -beginning of year Net pension obligation -end of year $ 74,110 74,110 (74,110) $ - -38- NOTE 6 -CITY OF MONTICELLO FIRE RELIEF ASSOCIATION (CONTINUED) The annual required contribution for the current year was determined as part of the August 1, 2007 actuarial valuation using the entry age actuarial cost method. The actuarial assumptions included: (a) 5 percent investment rate of return and (b) age and service retirement was assumed to occur at the age of 50. The assumptions did not include post-retirement benefit increases, which are funded by state statute when granted. Three-year trend information for the pension plan is as follows: Three-Year Trend Information 2008 2007 2006 Annual pension cost $ 74,110 $ 86,740 $ 98,518 Contribution made City _ _ _ State aid -pass-through aid 74,110 86,740 98,518 Net pension obligation _ _ _ NOTE 7 -OTHER POST-EMPLOYMENT BENEFITS PLAN A. Plan Description The City provides post-employment insurance benefits to certain eligible employees through the City's Other Post-Employment Benefits (OPEB) Plan, asingle-employer defined benefit plan administered by the City. All post-employment benefits are based on contractual agreements with employee groups. These contractual agreements do not include any specific contribution or funding requirements. These benefits are summarized as follows: Post-Employment Insurance Benefits -All retirees of the City have the option under state law to continue their medical insurance coverage through the City from the time of retirement until the employee reaches the age of eligibility for Medicare. For members of all employee groups, the retiree must pay the full premium to continue coverage for medical and dental insurance. The City is legally required to include any retirees for whom it provides health insurance coverage in the same insurance pool as its active employees, whether the premiums are paid by the City or the retiree. Consequently, participating retirees are considered to receive a secondary benefit known as an "implicit rate subsidy." This benefit relates to the assumption that the retiree is receiving a more favorable premium rate than they would otherwise be able to obtain if purchasing insurance on their own, due to being included in the same pool with the City's younger and statistically healthier active employees. B. Funding Policy The required contribution is based on projected pay-as-you-go financing requirements, with additional amounts to pre-fund benefits as determined annually by the City. -39- NOTE 7 -OTHER POST-EMPLOYMENT BENEFITS PLAN (CONTINUED) C. Annual OPEB Cost and Net OPEB Obligation The City's annual OPEB cost (expense) is calculated based on annual required contributions (ARC) of the City, an amount determined on an actuarially determined basis in accordance with the parameters of GASB Statement Nos. 43 and 45. The ARC represents a level funding that, if paid on an ongoing basis, is projected to cover normal costs each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed 30 years. The following table shows the components of the City's annual OPEB cost for the year, the amount actually contributed to the plan, and the changes in the City's net OPEB obligation to the plan: Annual required contribution Interest on net OPEB obligation Adjustment to annual required contribution Annual OPEB cost (expense) Less contribution made Increase in net OPEB obligation Net OPEB obligation -beginning of year 58,514 58,514 (4,834) 53,680 Net OPEB obligation -end of year $ 53,680 The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for the year are as follows: Percentage of Fiscal Annual OPEB Year Ended Cost Contributed Net OPEB Obligation January 1, 2008 $ 58,514 $ 4,834 8.3% $ 53,680 D. Funded Status and Funding Progress As of January 1, 2008, the most recent actuarial valuation date, the plan was zero percent funded. The actuarial accrued liability for benefits was $809,459, and the actuarial value of assets was $0, resulting in an unfunded actuarial accrued liability (UAAL) of $809,459. The covered payroll (annual payroll of active employees covered by the plan) was $2,751,614, and the ratio of the UAAL to the covered payroll was 29.4 percent. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and ARCS of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The Schedule of Funding Progress immediately following the notes to basic financial statements presents multi-year trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. E. Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. Annual Employer OPEB Cost Contribution -40- NOTE 7 -OTHER POST-EMPLOYMENT BENEFITS PLAN (CONTINUED) In the January 1, 2008 actuarial valuation, the projected unit credit actuarial cost method was used. The actuarial assumptions included: a 4.0 percent investment rate of return (net of administrative expenses) based on the City's own investments; an annual healthcare cost trend rate of 10.0 percent initially, reduced by decrements to an ultimate rate of 5.0 percent after 10 years for medical insurance. The UAAL is being amortized on a level dollar basis over a closed period. The remaining amortization period at January 1, 2008 was 30 years. NOTE 8 -DESIGNATED FUND BALANCE Designated fund balances at December 31, 2008 were as follows: General Fund Designated for Streets equipment Snow removal equipment Fire department equipment Building department equipment Data processing equipment Parks department buildings Parks department improvements Planning department Streetlight improvements Working capital Contingencies Community Center Fund Designated for Community center improvements Capital Outlay Revolving Fund Designated for Street equipment Fire department equipment Building improvements 7th street extension Nonmajor Fund City streets reconstruction Designated for Future Edmundson Street Future 85th Street Elk Street Fenning Avenue Fallon Avenue Haug and 95th Avenue $ 270,750 37,000 295,000 34,500 27,921 154,700 33,690 50,000 48,329 3,220,920 _ 360,000 4,532,810 63,000 25,637 119,114 187,683 600,000 932,434 187,991 135,637 10,300 202,077 72,015 122,500 730,520 $ 6,258,764 -41- NOTE 9 - INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS A. Due To/From Other Fund Receivable Fund Payable Fund Amount Major governmental funds Capital Outlay Revolving Capital Projects $ 1,607,609 This interfund loan was made to provide adequate cash flow. B. Interfund Transfers Interfund transfers for the year ended December 31, 2008 consisted of the following: Transfers In Sanitary Nonmajor Sewer Debt Service Capital Governmental Transfers Out General Fund EDA Fund Access Fund Funds Projects Funds Funds Sewer Fund Total General Fund S - S - $ - $ - S 125,000 S 85,804 S - S 210,804 Community Center Fund 20,000 20,000 - 650,000 - - - 690,000 Capita! Outlay Revolving Fund - - - - 794,545 - - 794,545 EDA Fund - - 1,953 457,672 - 9,142 - 468,767 Sanitary Sewer Access Fund - - - 1,940,039 - - - 1,940,039 Debt Service Fund - 59 21,200 9,808,571 490,021 558,389 21,561 10,899,801 Capital Projects Fund - - 180,555 684,364 - S 13 - 865,432 Noatnajor governmental funds - 644 - 576,813 - - - 577,457 Water Fund - - - - - 221,187 - 221,187 Liquor Fund 26,390 - - - 145,229 171,619 S 46,390 S 20,703 S 203,708 f 14,117,459 E 1,409,566 S 1,020,264 S 21,561 S 16,839,651 These transfers were made to finance general operations, capital projects, and debt service payments. NOTE 10 -STEWARDSHIP COMPLIANCE AND ACCOUNTABILITY Deficit Fund Balances The City has deficit fund balances at December 31, 2008 as follows: Capital Projects Fund $ (1,839,478) Fiber Optics Fund $ (997,728) The City intends to fund these deficits through future tax levies, special assessment levies, tax increments, transfers from other funds, and various other sources. -42- NOTE 11- C OMMITMENTS ' A. Construction Contracts During fiscal 2008, the City awarded contracts for various construction and remodeling projects. The City's commitment for uncompleted work on these contracts at December 31, 2008 is approximately $1,300,000. B. Legal Claims The City has the usual and customary type of miscellaneous legal claims pending at year-end. Although the lawsuits are not presently determinable, the City's management believes that the City will not incur any material monetary loss resulting from these claims. No loss has been recorded on the City's financial statements relating to these claims. C. Potential Arbitrage Payable t The City has issued several bond issues that are subject to arbitrage regulations contained in the Tax Reform Act of 1986. Typically, bond proceeds are invested until they are needed for construction projects or cash flow. Arbitrage exists when interest earnings on these investments exceed the interest cost of the related bonds. Any excess earnings must be paid to the Internal Revenue Service. At December 31, 2008, the City did not perform calculations to determine if there is an arbitra a liabili g tY on one of these issues. The City has not accrued an arbitrage rebate liability at December 31, 2008. The ' City expects the liability, if any, to be immaterial. NOTE 12 -PRIOR PERIOD ADJUSTMENT Adjustments to capital assets reflect a change in interpreting the amount of assets carried in construction ' in progress that were either duplicated or not capitalized as capital assets in the year of project completion. -43- REOUIlZED SUPPLEMENTARY INFORMATION CITY OF MONTICELLO i City of Monticello Other Post-Employment Benefits Plan Schedule of Funding Progress Unfunded Unfunded Actuarial Actuarial Actuarial Actuarial Liability as a Valuation Accrued Value of Accrued Funded Covered Percentage of Date Liability Plan Assets Liability Ratio Payroll Payroll January 1, 2008 $ 809,459 $ - $ 809,459 - $2,751,614 29.4% -44- CITY OF MONTICELLO General Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual Year Ended December 31, 2008 Revenue Property taxes Special assessments Licenses and permits Intergovernmental revenue Market value and other tax credits Fire department aid State police aid State highway aid County/regional grants Other grants and aids Total intergovernmental revenue Charges for services Animal impound fees Engineering fees Garbage charge Development cost reimbursement Inspection fees Township contract Other Total charges for services Original Budget Final Budget $ 5,743,929 $ 5,743,929 592,295 592,295 Actual $ 5,460,542 5,970 917,539 Over (Under) Budget (283,387) 5,970 325,244 Fines Miscellaneous revenue Interest earnings Rents Other Total miscellaneous revenue Total revenue Expenditures General government Mayor and City Council Personal services Other services and charges Total mayor and City Council - - 109,493 109,493 99,000 99,000 74,110 (24,890) 47,500 47,500 54,761 7,261 78,550 78,550 93,512 14,962 28,000 28,000 30,321 2,321 6,740 6,740 6,741 1 259,790 259,790 368,938 109,148 19,000 19,000 32,442 13,442 100,000 100,000 17,504 (82,496) 117,000 117,000 115,344 (1,656) 25,000 25,000 1,592 (23,408) 40,000 40,000 40,391 391 53,150 53,150 53,346 196 118,550 118,550 63,759 (54,791) 472,700 472,700 324,378 (148,322) 150 150 2,216 2,066 309,185 309,185 328,195 19,010 39,810 39,810 41,630 1,820 18,100 18,100 136,436 118,336 367,095 367,095 506,261 139,166 7,435,959 7,435,959 7,585,844 149,885 26,875 26,875 24,061 (2,814) 13,900 13,900 10,529 (3,371) 40,775 40,775 34,590 (6,185) (continued) -45- CITY OF MONTICELLO General Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual (continued) Year Ended December 31, 2008 Expenditures (continued) General government (continued) Administrative Personal services Other services and charges Total administrative Elections Personal services Other services and charges Total elections Finance Personal services Other services and charges Total finance Audit Assessing Legal Planning and zoning Personal services Other services and charges Professional services Total planning and zoning Data processing City hall Personal services Other services and charges Professional services Total city hall Deputy registrar Other services and charges Human resources Personal services Other services and charges Total human resources Over (Under) Original Budget Final Budget Actual Budget 287,227 287,227 223,673 (63,554) 15,275 15,275 36,949 21,674 302,502 302,502 260,622 (41,880) 10,000 10,000 3,081 (6,919) 6,200 6,200 11,284 5,084 16,200 16,200 14,365 (1,835) 356,553 356,553 392,411 35,858 29,950 29,950 36,223 6,273 386,503 386,503 428,634 42,131 36,250 36,250 43,375 7,125 53,675 53,675 51,413 (2,262) 50,088 50,088 73,556 23,468 131,242 131,242 81,057 (50,185) 1,100 1,100 5,877 4,777 180,650 180,650 118,229 (62,421) 312,992 312,992 205,163 (107,829) 120,550 120,550 107,392 (13,158) 51,599 51,599 43,002 (8,597) 50,040 50,040 49,165 (875) 87,850 87,850 90,419 2,569 189,489 189,489 182,586 (6,903) - - 204 204 - - 15,698 15,698 - - 32 32 - - 15,730 15,730 (continued) -46- CITY OF MONTICELLO General Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual (continued) Year Ended December 31, 2008 Over (Under) Original Budget Final Budget Actual Budget Expenditures (continued) General government (continued) Insurance 187,405 187,405 161,534 (25,871) Capital outlay 22,500 22,500 5,400 (17,100) Total general government 1,718,929 1,718,929 1,584,564 (134,365) Public safety Law enforcement 1,000,173 1,000,173 990,621 (9,552) Fire relief association 100,476 100,476 74,110 (26,366) Fire Personal services 104,740 104,740 113,979 9,239 Supplies 35,250 35,250 29,868 (5,382) Other services and charges 44,115 44,115 38,999 (5,116) Repairs and maintenance 28,300 28,300 18,589 (9,711) Total fire 212,405 212,405 201,435 (10,970) Building inspections Personal services 297,139 297,139 343,442 46,303 Other services and charges 86,425 86,425 62,338 (24,087) Total building inspections 383,564 383,564 405,780 22,216 Civil defense Personal services 12,940 12,940 3,570 (9,370) Other services and charges 35,850 35,850 566 (35,284) Total civil defense 48,790 48,790 4,136 (44,654) Animal control 45,875 45,875 48,273 2,398 National guard 24,620 24,620 12,607 (12,013) Capital outlay 173,500 173,500 15,747 (157,753) Total public safety 1,989,403 1,989,403 1,752,709 (236,694) Public works Administration Persona( services 208,810 208,810 236,103 27,293 Other services and charges 23,380 23,380 39,735 16,355 Total administration 232,190 232,190 275,838 43,648 (continued) -47- CITY OF MONTICELLO General Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual (continued) Year Ended December 31, 2008 Over (Under) Original Budget Final Budget Actual Budget Expenditures (continued) Engineering Personal services 97,006 97,006 119,150 22,144 Other services and charges 155,025 155,025 199,001 43,976 Total engineering 252,031 252,031 318,151 66,120 Inspections Personal services 146,383 146,383 117,580 (28,803) Other services and charges 21,850 21,850 17,596 (4,254) Total inspections 168,233 168,233 135,176 (33,057) Streets Personal services 395,457 395,457 402,200 6,743 Other services and charges 132,950 132,950 225,486 92,536 Total streets 528,407 528,407 627,686 99,279 Ice and snow Personal services 58,213 58,213 77,024 18,811 Other services and charges 47,750 47,750 62,550 14,800 Total ice and snow 105,963 105,963 139,574 33,611 Shop and garage Personal services 79,549 79,549 78,355 (1,194) Other services and charges 105,300 105,300 85,055 (20,245) Total shop and garage 184,849 184,849 163,410 (21,439) Parking lots 162,300 162,300 232,731 70,431 Capital outlay 537,200 537,200 232,211 (304,989) Total public works 2,171,173 2,171,173 2,124,777 (46,396) Sanitation Personal services 12,070 12,070 9,152 (2,918) Other services and charges 502,350 502,350 505,156 2,806 Total sanitation 514,420 514,420 514,308 (112) Culture and recreation Parks Personal services 378,113 378,113 332,406 (45,707) Other services and charges 138,950 138,950 116,558 (22,392) Total parks 517,063 517,063 448,964 (68,099) Community celebrations 8,500 8,500 2,252 (6,248) (continued) -48- CITY OF MONTICELLO General Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual (continued) Year Ended December 31, 2008 Expenditures (continued) Museum Personal services Other services and charges Total museum Senior center Personal services Other services and charges Totat senior center Community education Park improvements NSP Ball Fields Transit-River Rider Ice arena Capital outlay Total culture and recreation Economic development Personal services Other services and charges Totat economic development Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses) Transfer in Transfer (out) Proceeds from sale of assets Total other financing sources (uses) Net change in funds balances Fund balances Beginning of year End of year Original Budget Final Budget Over (Under) Budget - - 54 54 - - 25 25 - - 79 79 1,715 1,715 133 (1,582) 94,305 94,305 57,999 (36,306) 96,020 96,020 58,132 (37,888) 12,740 12,740 12,740 - 21,000 21,000 13,285 (7,715) 19,200 19,200 16,702 (2,498) 5,000 5,000 - (5,000) 75,000 75,000 75,000 - 230,000 230,000 123,781 (106,219) 984,523 984,523 750,935 (233,588) 34,561 34,561 73,948 39,387 8,900 8,900 5,699 _ (3,201) 43,461 43,461 79,647 36,186 7,421,909 7,421,909 6,806,940 (614,969) 14,050 14,050 778,904 764,854 46,390 46,390 46,390 - - - (210,804) (210,804) 100 100 2,575 2,475 46,490 46,490 (161,839) (208,329) $ 60,540 $ 60,540 617,065 $ 556,525 5,561,487 $ 6,178,552 -49- CITY OF MONTICELLO Community Center Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual Year Ended December 31, 2008 Revenue Property taxes Intergovernmental Charges for services Membership dues and fees Interest earnings (charges) Miscellaneous Total revenue Expenditures Current Culture and recreation Personal services Supplies Professional services Advertising Repairs and maintenance Insurance Utilities Telephone Equipment and other rental Other Capital outlay Total expenditures Excess of revenues over expenditures Other financing sources (uses) Transfers out Net change in fund balances Fund balance Beginning of year End of year -50- Original Budget Final Budget Actual Over (Under) Budget $ 1,439,150 $ 1,439,150 $ 1,360,350 $ (78,800) - - 25 290 25 290 1,071,200 9,000 800 2,520,150 1,071,200 1,067,038 (4,162) 9,000 36,334 27,334 800 13,381 12,581 2,520,150 2,502,393 (17,757) 860,001 860,001 887,123 27,122 232,900 232,900 191,101 (41,799) 42,900 42,900 66,775 23,875 17,500 17,500 17,919 419 149,000 149,000 108,098 (40,902) 25,300 25,300 22,704 (2,596) 221,000 221,000 200,310 (20,690) 10,000 10,000 9,820 (180) 18,800 18,800 14,350 (4,450) 25,700 25,700 32,678 6,978 43,000 43,000 5,224 (37,776) 1,646,101 1,646,101 1,556,102 (89,999) 874,049 874,049 946,291 72,242 (883,950) (883,950) (690,000) 193,950 $ (9,901) $ (9,901) 256,291 $ 266,192 490,424 $ 746,715 CITY OF MONTICELLO Capital Outlay Revolving Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual Year Ended December 31, 2008 Revenue Property taxes Special assessments Interest earnings Total revenue Expenditures Capital outlay Public works Professional services Other Total expenditures Excess of revenues over expenditures Other financing sources (uses) Transfers out Net change in fund balances Fund balance Beginning of year, as previously reported Prior period adjustment Beginning of year, as restated End of year Over (Under) Original Budget Final Budget Actual Budget $ - $ - $ 263 $ 263 130,SSS 130,SSS 139,498 8,943 88,SS0 88,SS0 100,340 11,790 219, l OS 219, l OS 240,101 20,996 - - SS,608 SS,608 - 344 344 - SS,9S2 SS,9S2 219,1OS 219,1OS $ 219,1OS $ 219,1OS 184,149 (34,956) (794,S4S) (794,S4S) (610,396) $ (829,501) 8,470, 819 (2,584,967) S,88S,8S2 $ S,27S,4S6 -S 1- CITY OF MONTICELLO Sanitary Sewer Access Fund Schedule of Revenue, Expenditures, and Changes in Fund Balances Budget and Actual Year Ended December 31, 2008 Revenue Special assessments Charges for services Access fees Interest earnings Total revenue Expenditures Current Public works Professional services Other Total expenditures Excess (deficiency) of revenues over expenditures Other financing sources (uses) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Fund balance Beginning of year End of year Over (Under) Original Budget Final Budget Actual Budget $ 223,154 $ 223,154 $ 257,896 $ 34,742 336,250 336,250 270,753 (65,497) 233,900 233,900 254,622 20,722 793,304 793,304 783,271 (10,033) - - 17,948 17,948 - - 507 507 _ - 18,455 18,455 793,304 793,304 764,816 (28,488) - - 203,708 203,708 (1,712,013) (1,712,013) (1,940,039) (228,026) (1,712,013) (1,712,013) (1,736,331) (24,318) $ (918,709) $ (918,709) (971,515) $ (52,806) 5,996,543 $ 5,025,028 -52- CITY OF MONTICELLO Notes to the Required Supplementary Information December 31, 2008 Budgetary Information The City follows these procedures in establishing the budgetary data reflected in the financial statements: A. Prior to September 1, the city administrator submits to the City Council a proposed operating budget for the fiscal year commencing the following January 1. The operating budget includes proposed expenditures and the means of financing them. The City Council adopts the proposed budget as amended and adjusted by the City Council and certifies the proposed property tax levy to the county auditor according to Minnesota Statutes. B. Public hearings are conducted at the City Council's chambers in the Municipal Building. C. On or before December 28, the final budget is legally enacted by City Council resolutions and the final property tax levy is certified to the county auditor. D. Management is authorized to transfer budgeted amounts between departments within a fund; however, any revisions that alter the total expenditures of any fund must be approved by the City Council. E. The City has legally adopted budgets for the General Fund, certain special revenue funds, and the Debt Service Fund. Expenditures may not legally exceed budgeted appropriations at the total fund level. Monitoring of budgets is maintained at the expenditure category level (i.e. personal services, supplies, charges for services, and capital outlay) within each program. All amounts over budget have been approved by the City Council through the disbursement process. The City is not legally required to adopt an annual budget for the Capital Projects Fund. Project-length financial plans are adopted for the Capital Projects Fund. F. Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Budgeted amounts are as originally adopted or amended by the City Council. All annual appropriations lapse at year-end. -53- COMBINING NONMAJOR FUND STATEMENTS CTI'Y OF MONTICELLO Nonmajor Governmental Funds Combining Balance Sheet as of December 3 i, 2008 Special Revenue Funds Central Orderly Minnesota Economic Shade Tree Annexation Library Water Access Initiative Recovery Grant Assets Cash and investments $ 49,355 $ 7,861 $ 9,186 $ 830,323 $ - $ - Receivables Delinquent taxes 1,087 159 1,292 - _ _ Deferred special assessments - - - 213,583 - - Delinquent special assessments - - - 41,013 - - Accounts 1,214 - - 2,606 - - Accrued interest 431 47 54 2,741 - - Prepaid items - - 136 82 - - Total assets $ 52,087 $ 8,067 $ 10,668 $ 1,090,348 $ - $ - Liabilities and Fund Balances Liabilities Accounts and contracts payable $ 314 $ - $ 419 $ - $ - $ _ Other accrued liabilities 70 - 241 - - _ Due to other governmental units 68 - - - _ _ Deferred revenue 980 124 1,273 254,596 - - Totalliabilities 1,432 124 1,933 254,596 - - Fund balances (deficit) Reserved for prepaid items - - 136 82 - - Unreserved -designated - - _ _ _ _ Unreserved - undesignated 50,655 7,943 8,599 835,670 - - Total fund balances 50,655 7,943 8,735 835,752 - - Total liabilities and fund balances $ 52,087 $ 8,067 $ 10,668 $ 1,090,348 $ - $ - -54- Pazk City Street Storm Sewer Minnesota Pathway Streets Deputy Grant Lighting Access Investment Dedication Reconstruction Registraz Funding Improvement Totals $ 1,711,104 $ 881,722 $ 548,072 $ 1,441,699 $ 141,522 $ - $ 204,134 $ 5,824,978 - - - 13,344 - - - 15,882 641,621 - 320,748 308,428 - - - 1,484,380 145,641 - 125,879 36,505 - - - 349,038 8,262 - 2,271 - 22,827 - 67,243 104,423 16,845 8,802 9,923 10,421 864 - 713 50,841 89 - - - 1,427 - 1,734 $ 2,523,562 $ 890,524 $ 1,006,893 $ 1,810,397 $ 166,640 $ - $ 272,090 $ 7,831,276 $ 13,618 $ - $ - $ - $ 224 $ _ $ - $ 14,575 - - - - 5,016 - - 5,327 - - 650,000 - 40,442 - - 690,510 787,262 - 446,627 359,557 - - - 1,850,419 800,880 - 1,096,627 359,557 45,682 - - 2,560,831 89 - - - 1,427 - - 1,734 - - 730,520 - 730,520 1,722,593 890,524 (89,734) 720,320 119,531 - 272,090 4,538,191 1,722,682 890,524 (89,734) 1,450,840 120,958 - 272,090 5,270,445 $ 2,523,562 $ 890,524 $ 1,006,893 $ 1,810,397 $ 166,640 $ - $ 272,090 $ 7,831,276 -55- CITY OF MONTICELLO Nonmajor Governmental Funds Combining Statement of Revenue, Expenditures, and Changes in Fund Balances Yeaz Ended December 31, 2008 Revenue Property taxes Special assessments Intergovernmental Charges for services Other Investment earnings (chazges) Miscellaneous Total revenue Expenditures Cuttent Public works Culture and recreation Capital outlay Public works Culture and recreation Economic development Total expenditures Excess (deficiency) of revenue over expenditures Other financing sources (uses) Transfers in Transfers (out) Total other financing sources (uses) Change in fund balances Fund balances (deficit) Beginning of year End of year Special Revenue Funds Central Orderly Minnesota Economic Shade Tree Annexation Library Water Access Initiative Recovery Grant $ 32,112 $ 4,885 $ 36,021 $ - $ - $ - - - - 74,272 - - 601 94 668 - - - 7,129 - 90 35,320 - - 2,019 230 198 11,271 - - 5,796 - - - - - 47,657 5,209 36,977 120,863 - - 41,725 - - - - - - - 39,104 - - - - - - 1,459 - - - 360 - - - - 41,725 360 39,104 1,459 - - 5,932 4,849 (2,127) 119,404 - - - - - 723,852 - - - - - (311,220) (100) (544) - - - 412,632 (100) (544) 5,932 4,849 (2,127) 532,036 (100) (544) 44,723 3,094 10,862 303,716 100 544 $ 50,655 $ 7,943 $ 8,735 $ 835,752 $ - $ - -56- Park City Street Storm Sewer Minnesota Pathway Streets Deputy Grant Lighting Access Investment Dedication Reconstruction Registraz Funding Improvement Totals $ - $ - $ - $ 337,296 $ - $ - $ - $ 410,314 155,900 - 91,885 56,570 - - - 378,627 - - - 6,222 - 139,239 - 146,824 24,959 - - - 276,919 - 267,630 612,047 77,550 43,933 47,197 52,105 5,555 - 4,460 244,518 - - - 5,796 258,409 43,933 139,082 452,193 282,474 139,239 272,090 1,798,126 - - - - 222,252 150,043 - 414,020 - - 3,232 - - - - 42,336 21,350 - - - 14,264 - - 37,073 - - 1,203,456 - - - - 1,203,456 - 190,000 - - - 190,360 21,350 190,000 1,206,688 - 236,516 150,043 - 1,887,245 237,059 (146,067) (1,067,606) 452,193 45,958 (10,804) 272,090 (89,119) 65,379 - - 145,229 75,000 10,804 - 1,020,264 (264,776) - - (817) - - - (577,457) (199,397) - - 144,412 75,000 10,804 - 442,807 37,662 (146,067) (1,067,606) 596,605 120,958 - 272,090 353,688 1,685,020 1,036,591 977,872 854,235 - - - 4,916,757 $ 1,722,682 $ 890,524 $ (89,734) $ 1,450,840 $ 120,958 $ - $ 272,090 $ 5,270,445 -57- Council Agenda: June 8, 2009 8. Consideration of applying the deferred assessment for Lot 1, Block 1 River View Square to the lots in the created River View Square Second Addition. TK A. REFERENCE AND BACKGROUND: On September 22, 2008 the City Council approved the final plat of River View Square Second Addition along with a conditional use permit for a drive through facility for M & I Bank. At that time the parcel that became River View Square Second Addition (Lot 1, Block 1 River View Square 155-117-001010) was subject to an assessment agreement between MMC Land Company and the City of Monticello for improvements relating to the CSAH 18/I-94 interchange project. Under the terms of the agreement (Document # A 1020863) the assessments for the original parcels were deferred until 2011 or until the property was sold or developed. At the present time Lot 1, Block 1 River View Square Second Addition (155-214-001010) is owned by M & I Bank and Lot 2, Block 1 River View Square Second Addition (155-214-001020) is owned by Broadway Market Investors, LLC. The sale of the property by MMC Land Company is the trigger event that initiates the assessment for the CSAH 18/I-94 Interchange project. It is proposed to split the deferred assessment amount of $63,842.00 based on the acreage of the plat which is 3.39 acres. Lot 1, Block 1 containing 1.00 acres would receive an assessment of $18,833.39 (29.5%) plus the $4.75 county fee for handling the assessment and Lot 2, Block 1 consisting of 2.39 acres would receive an assessment of $45,008.61 (70.5%) plus the $4.75 county fee for handling the assessment. The assessment would run for ten years beginning in 2010 with an interest rate of 4% per annum on the unpaid balance. The property owners have been notified by mail of the City's intent to certify the assessments according to the terms of the assessment agreement as noted above. B. ALTERNATIVE ACTIONS: Approve certifying the assessments for the CSAH 18/I-94 Interchange project for Lot 1 and Lot 2, Block 1 River View Square Second Addition in the amounts proposed and under the terms of the assessment agreement. 2. Do not approve certifying the assessments as proposed. C. STAFF RECOMMENDATION: According to the provisions of the assessment agreement the sale of the property is a triggering event that would activate the deferred assessment. Staff recommends certification of the assessment as proposed. D. SUPPORTING DATA: Copy of assessment agreement Assessment Breakdown .~ RETURN TU. ~~ ~ ~~, Doc. No. A 1020863 OFFICE OF THE COUNTY RECORDER WRIGHT COUNTY, MINNESOTA Certified Filed and/or Recorded on 08-09-2006 at 11:20 Check #: Fee: $46.00 Payment Code 04 Addl. Fee Larry A: Unger, County Recorder AGREEMENT AGREEMENT made this 14`h day of June, 2006, by and between MMC LAND COMPANY, LLC, a Minnesota limited liability company ("Owner") and the CITY OF MONTICELLO, a Minnesota municipal corporation ("City") relating to the CSAH 18/I-94 Interchange Project No. 2004-1C. 1. Permanent and Temporary Easements. Contemporaneously with this Agreement, Owner will execute and deliver to the City the following items: a. Temporary construction easement on Lot 3, Block 1, River View Square, a copy of which is attached hereto as Exhibit "A"; and b. Permanent right-of-way easement, permanent drainage and utility easement, and temporary construction easement on I..ot 1, Block 1, River View Square, a copy of which is attached hereto as Exhibit "B." 2. Consideration. Upon execution and delivery of this Agreement and the Easements, the City will pay Owner $96,800.00 as compensation for the easements. 3. CSAH 18/I-94 -Interchange Project Assessment. The assessments for CSAH 18/I-94 Interchange Project No. 2004-1C shall be in the following amounts: 123436v02 1 Parcel Amount Lot 1, Block 1, River View Square $63,842.00 Lot 3, Block 1, River View Square $48,433.00 Lot 1, Block 2, River View Square $109,322.50 Owner hereby waives any and all procedural and substantive objections to the assessments, including, but not limited to, any rights of the Owner to hearing requirements and any claims that the assessments do not constitute a special benefit or that the amount of the assessments exceeds the special benefit to the Subject Property. The above assessments are hereby adopted on the date this Agreement is signed by the parties. 4. Deferral of Assessments. a. The above assessments for the CSAH 18/I-94 Interchange Project will be deferred without interest until January 1, 2011 at which time the assessments will then be payable over ten (10) years, including interest commencing January 1, 2011 at the rate of four percent (4%) per annum simple interest computed on the unpaid balance with the first installment collectable as part of the payable 2012 taxes. b. If any parcel is subdivided prior to January 1, 2011, the assessment for that parcel will be equitably apportioned to individual lots on a square footage basis in accordance with Minn. Stat. §429.071. As each subdivided lot is either sold or developed, whichever occurs first, the apportioned assessment for the lot will then be payable over ten (10) years, including interest commencing July 1 of the year the property is sold or develops, with the first installment collectable as part of the following years payable taxes (or the next year if the transaction occurs 123436v02 2 STATE OF MINNESOTA ) ss. COUNTY OF CARVER ) The foregoing instrument was acknowledged before me this ~~~" day of 2006, by Richard E. Williamson and John V. Ryan, Jr., the Chief Executive Manager and the Chief Financial Manager, respectively, of MMC Land Company, LLC, a Miruiesota limited liability company, on behalf of the limited lial„t,r~ rmm~anv C',rantnr BRYAN WM. NUBER NOTARY PIJBIIC • MlNNES07A lily CannUasian Expires Jan. 31, ZO10 THIS INSTRUMENT WAS DRAFTED BY: CAMPBELL KNUTSON Professional Association 317 Eagandale Office Center 1380 Corporate Center Curve Eagan, MN 55121 Telephone: 651-452-5000 TMS 123436x02 4 to late in year to certify assessments to county). A lot is "developed" when a building permit is issued. c. The assessments on any parcel or subdivided lot not sold or developed by January 1, 2011 shall then be payable over ten (10) years, including interest at the rate of four percent (4%) simple interest computed on the unpaid balance commencing January 1, 2011, with the first installment collectable as part of payable 2011 taxes. 5. Median. City will at its expense remove the easterly portion of the median on CSAH 75 by October 1, 2006 in order to allow full unrestricted access to Owner's gas station. CITY OF MO CELLO By: C ' Herbs~t,/M'ayor By: W Rick Wolfsteller City Administrator STATE OF MINNESOTA ) ss. COUNTY OF WRIGHT ) MMC LAND COMPAN/Y, LLC ~, `~/ By: Its Chief Ex e Manager By: is Ch' ncial Manager The foregoing instrument was acknowledged before me this 4th day of August , 2006, by Clint Herbst and by Rick Wolfsteller, respectively the Mayor and City Administrator of the City of Monticello, a Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority granted by its City Council. DAWN M. GROSS(NGER'~ . NOTARY PUBLIC -MINNESOTA MY Commission Expires Jan. 31, 2010 ~. Notary Public 123436v02 3 EXHIBIT "A" TO AGREEMENT GRANT OF TEMPORARY EASEMENT MMC LAND COMPANY, LLC, a Minnesota limited liability company, "Grantor," in consideration of One Dollar and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, does hereby grant unto the CITY OF MONTICELLO, a Minnesota municipal corporation, the Grantee, hereinafter referred to as the "City," its successors and assigns, a temporary construction easement over, across, on, under, and through the land situated in the County of Wright, State of Minnesota, as legally described on the attached Exhibit "A." TO HAVE AND TO HOLD the same, unto the City, its contractors, agents, servants and assigns, commencing upon execution of this document and expiring December 31, 2007, together with the right of ingress to and egress from the temporary easement premises, for the purpose of constructing, reconstructing, inspecting, repairing, and maintaining the property of the City, at the will of the City, its successors and assigns. Grantor hereby grants the uses herein specified without divesting itself of the right to use and enjoy the above described temporary easement premises, subject only to the right of the City to use the same for the purposes herein expressed. The City, its agents and assigns, will restore the described property to a condition as nearly equal as possible to that which existed prior to construction. 123436x02 The above named Grantor, for itself, its successors and assigns, does covenant with the City, its successors and assigns, that it is well seized in fee title of the above described easement premises; that it has the sole right to grant and convey the easement to the City; that there are no unrecorded interests in the easement premises; and that it will indemnify and hold the City harmless for any breach of the foregoing covenants. IN TESTIMONY WHEREOF, the Grantor hereto has signed this document this day of , 2006. STATE OF MINNESOTA ) ss. COUNTY OF ) GRANTOR: MMC LAND COMPANY, LLC By:_ Its: This instrument was acknowledged before me this day of by the Land Company, LLC, a Minnesota limited liability company, on behalf of the company. Notary Public THIS INSTRUMENT WAS DRAFTED BY: CAMPBELL KNUTSON Professional Association 317 Eagandale Office Center 1380 Corporate Center Curve Eagan, MN 55121 Telephone: 651-452-5000 TMS/srn 2006, of MMC 123436v02 2 EXHIBIT "A" TO GRANT OF TEMPORARY EASEMENT That part of the following described parcel of land in the City of Monticello: I.,ot 3, Block 1, RIVER VIEW SQUARE, according to said plat on file and of record in the office of the County Recorder, Wright County, Minnesota. Which lies within the following temporary easement for construction purposes: That part of Lot 3, Block 1, RIVER VIEW SQUARE, according to said plat on file and of record in the office of the County Recorder, Wright County, Minnesota, which lies southeasterly and easterly of the following described line: Commencing at the southeast corner of said Lot 3; thence South 88 degrees 50 minutes 32 seconds West, assumed bearing along the south line of said Lot 3, 140.99 feet, to the point of beginning of said line to be hereinafter described; thence North 45 degrees 39 minutes 06 seconds East, 95.25 feet, to its intersection with a line drawn parallel with and distant 72.00 feet west of the east line of said Lot 3; thence North 00 degrees 44 minutes 47 seconds West, along said parallel line, 161.62 feet, to the northerly line of said Lot 3, and said line there terminating. Except that part which lies within the existing platted drainage and utility easements. Said temporary construction easement to expire December 31, 2007. 123436v02 3 EXHIBIT "B" TO AGREEMENT GRANT OF PERMANENT AND TEMPORARY EASEMENTS MMC LAND. COMPANY, LLC, a Minnesota limited liability company, "Grantor," in consideration of One Dollar and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, does hereby grant unto the COUNTY OF WRIGHT, a political subdivision of the State of Minnesota, the Grantee, hereinafter referred to as "County," its successors and assigns, the following easements: 1. A permanent easement for street, drainage and utility purposes over, on, across, under, and through the land situated in the County of Wright, State of Minnesota, as legally described on the attached Exhibit "A." INCLUDING the rights of the County, its contractors, agents, servants, and assigns, to enter upon the permanent easement premises at all reasonable times to construct, reconstruct, inspect, repair, and maintain said street, drainage and utility systems over, across, on, under, and through the permanent easement premises, together with the right to grade, level, fill, drain, and excavate the permanent easement premises, and the further right to remove trees, bushes, undergrowth, and other obstructions interfering with the location, construction, and maintenance of said public street, drainage and utility easements. 123436v02 RIVER VIEW SQUARE SECOND ADDITION SPECIAL ASSESSMENT BREAKDOWN Original Parcel: Lot 1, Block 1 River View Square Addition PID - 155-117-001010 Size: 3.39 acres; 147,866.30 sq. ft. Deferred Assessment Amount: $63,842.00 Interest rate: 4% -Interest from 7/1 of the year sold (Property sold 11/18/2008) New Parcel Lot 1, Block 1 River View Square Second Addition PID - 155-214-001010 Size: 1.00 acres; 43,689.50 sq. ft. Assessment: $18,833.39 (29.5% of total) + $4.75=$18,838.14 New Parcel: Lot 2, Block 1 River View Square Second Addition PID: 155-214-001020 Size: 2.39 acres; 104,176.30 sq. ft. Assessment: $45,008.61 (70.5% of total) + $4.75=$45,013.36 ESTIMATED ASSESSMENT 155-214-001010 Year Principal Interest Balance Remaining 2010 $1,883.81 $1,186.10 $16,954.33 2011 $1,883.81 $678.17 $15,070.52 2012 $1,883.81 $602.82 $13,186.71 2013 $1,883.81 $527.47 $11,302.90 2014 $1,883.81 $452.12 $9,419.09 2015 $1,883.81 $376.76 $7,535.28 2016 $1,883.81 $301.41 $5,651.47 2017 $1,883.81 $226.06 $3,767.66 2018 $1,883.81 $150.71 $1,883.85 2019 $1,883.85 $75.35 $0.00 ESTIMATED ASSESSMENT 155-214-001020 Year Principal Interest Balance Remaining 2010 $4,501.34 $4,508.18 $40,512.02 2011 $4,501.34 $1,620.48 $36,010.68 2012 $4,501.34 $1,440.43 $31,509.34 2013 $4,501.34 $1,260.37 $27,008.00 2014 $4,501.34 $1,080.32 $22,506.66 2015 $4,501.34 $900.27 $18,005.32 2016 $4,501.34 $720.21 $13,503.98 2017 $4,501.34 $540.16 $9,002.64 2018 $4,501.34 $360.11 $4,501.30 2019 $4,501.30 $180.05 $0.00 Interest from 7/1/2008 thru 12/31/2010 Interest from 7/1/2008 thru 12/31/2010 Council Agenda - 06/08/2009 9. Consideration of Electric Distribution and Transmission Franchise Ordinance and Associated Ordinance granting a franchise to Wright-Hennepin Cooperative Electric Association . (B.P., J.J.) A. BACKGROUND INFORMATION: The City of Monticello and Wright-Hennepin Cooperative Electric Association have recently concluded negotiations regarding an electric distribution and transmission franchise ordinance and franchise fee ordinance. The proposed franchise is based on a model franchise ordinance prepared by the League of Minnesota Cities and the Suburban Rate Authority, a joint powers group of metropolitan cities that works collectively on utility issues. The franchise is designed to work in conjunction with the City's Right of Way Management Ordinance and federal and state laws regulating the location of facilities, one-call locates, mapping information, relocation of facilities, and restoration of public grounds and right of ways. In lieu of paying permit fees, if the City adopts the accompanying Franchise Fee Ordinance, the company will pay a franchise fee collected by charging various classes of customers a per month premises fee. Unlike a gross revenue fee, it will not increase along with the company's service charges, but will grow with the addition of new customers to the system. The amount of the fee was adjusted to take into account that unlike other right of way users the company will not pay ongoing permit fees. An estimate of the expected revenues from the fee, prepared by Wright- Hennepin Cooperative Electric Association, is attached as supporting data to this report. This franchise agreement is similar to current agreement with Xcel Energy. The franchise conditions the franchise fee on the City extending it to other energy providers unless the City limits the expenditure of funds generated by the fee to the betterment of electric facilities such as pole relocations, undergrounding power lines and facilities, facilities, or paying for the City's streetlight system, including new or improved lighting facilities and ongoing service charges and maintenance. a. Budget Impact: A revenue increase of an estimated $3,951.75 will be realized in early January 2010 and every quarter thereafter until expiration of this franchise agreement. Billing starts in September, actual first quarterly payment of the fees to City will occur Jan 15th (Sept, Oct, Nov) fees. This is because the last bills go out Nov 20th and aren't due until December. b. Staff Workload Impact: Minimal accounting, little or no further City Attorney attention. B. ALTERNATIVES: 1. The first alternative would be to approve Franchise Ordinance #498 and Franchise Fee Ordinance #499. Council Agenda - 06/08/2008 2. The second alternative would be to approve Franchise Ordinance #498 but not Franchise Fee Ordinance #499. 3. The third alternative would be to not approve either ordinance and to direct staff to resume negotiations with Wright-Hennepin Cooperative Electric Association regarding modifications or amendments sought by Council to one or both of the proposed ordinances. C. STAFF RECOMMENDATION: It is the recommendation of Staff that Council approve both the Franchise and Franchise Fee Ordinances #498 and #499 respectively. D. SUPPORTING DATA: Copy of Franchise Ordinance #498 for Wright-Hennepin Cooperative Electric Association; Copy of Franchise Fee Ordinance #499 for Wright-Hennepin Cooperative Electric Association; and Copy of Wright-Hennepin Cooperative Electric Association Franchise fee estimate. SUPPOR11N6D~T1 ORDINANCE NO. 498 CITY OF MONTICELLO WRIGHT COUNTY, MINNESOTA ELECTRIC FRANCHISE ORDINANCE AN ORDINANCE GRANTING A FRANCHISE TO WRIGHT-HENNEPIN COOPERATIVE ELECTRIC ASSOCIATION, ITS SUCCESSORS AND ASSIGNS, TO CONSTRUCT, OPERATE, REPAIR AND MAINTAIN AN ELECTRIC DISTRIBUTION SYSTEM AND TRANSMISSION LINES IN THE CITY OF MONTICELLO, MINNESOTA, INCLUDING NECESSARY POLES, LINES, FIXTURES AND APPURTENANCES, FOR THE FURNISHING OF ELECTRIC ENERGY TO THE CITY, ITS INHABITANTS, AND OTHERS, AND TO USE THE PUBLIC WAYS AND PUBLIC GROUNDS OF THE CITY FOR SUCH PURPOSES. THE CITY COUNCIL OF THE CITY OF MONTICELLO, WRIGHT COUNTY, MINNESOTA, ORDAINS: SECTION 1. DEFINITIONS. For purposes of this Ordinance, the following capitalized terms listed in alphabetical order shall have the following meanings: City. The City of Monticello, County of Wright, State of Minnesota. City Utility System. Facilities used for providing public utility service owned or operated by City or agency thereof, including sanitary sewer, storm sewer, and water service, but excluding facilities for providing heating, lighting or other forms of energy. Commission. The Minnesota Public Utilities Commission, or any successor agency or agencies, including an agency of the federal government which preempts all or part of the authority to regulate electric retail rates now vested in the Minnesota Public Utilities Commission. and assigns. Company. Wright-Hennepin Cooperative Electric Association, its successors Electric Facilities. Electric transmission and distribution towers, poles, lines, guys, anchors, conduits, fixtures, and necessary appurtenances owned or operated by Company for the purpose of providing electric energy for public use. Notice. A written notice served by one party on the other party referencing one or more provisions of this Ordinance. Notice to Company shall be mailed to the President/Chief Executive Officer of Wright-Hennepin Cooperative Electric Association at DOCS-# 145403-v4-WRIGHT- HENNEPIN_ELECTRIC_FRANCHISE_AND_FRANCHISE_FEE_ORDINANCES 6800 Electric Drive, Rockford, MN. Notice to the City shall be mailed to the City Administrator, 505 Walnut Street, Suite 1, Monticello, MN 55362. Either party may change its respective address for the purpose of this Ordinance by written notice to the other party. Public Ground. Land owned or otherwise controlled by the City for park, open space or similar purpose, which is held for use in common by the public. the City. Public Way. Any street, alley, walkway or other public right-of--way within SECTION 2. ADOPTION OF FRANCHISE. 2.1 Grant of Franchise. City hereby grants Company, fora period of 18 years from the date this Ordinance is passed and approved by the City, the non-exclusive right to transmit and furnish electric energy for light, heat, power and other purposes for public and private use within and through the limits of the City as its boundaries now exist or as they may be extended in the future. For these purposes, Company may construct, operate, repair and maintain Electric Facilities in, on, over, under and across the Public Ways and Public Grounds of City, subject to the provisions of this Ordinance. Company may do all reasonable things necessary or customary to accomplish these purposes, subject, however, to such reasonable regulations as may be imposed by the City pursuant to ordinance and to the further provisions of this ordinance. 2.2 Effective Date; Written Acceptance. This franchise shall be in force and effect from and after passage of this Ordinance, its acceptance by Company, and its publication as required by law. The City by Council resolution may revoke this franchise agreement if Company does not file a written acceptance with the City within 90 days after publication. 2.3 Service and Rates. The service to be provided and the rates to be charged by Company are established by the Company. The area within the City in which Company may provide electric service is subject to the provisions of Minnesota Statutes, Section 216B.40. 2.4 Publication Expense. The expense of publication of this Ordinance will be paid by City and reimbursed to City by Company. 2.5 Dispute Resolution. If either party asserts that the other party is in default in the performance of any obligation hereunder, the complaining parry shall notify the other party of the default and the desired remedy. The notification shall be written. Representatives of the parties must promptly meet and attempt in good faith to negotiate a resolution of the dispute. If the dispute is not resolved within 30 days of the written notice, the parties may jointly select a mediator to facilitate further discussion. The parties will equally share the fees and expenses of this mediator. If a mediator is not used or if the parties are unable to resolve the dispute within 30 days after first meeting with the selected mediator, either party may commence an action in District Court to interpret and enforce this franchise or for such other relief as may be permitted by law or equity. DOCS-# 145403-v4-WRIGHT- HENNEPIN_ELECTRIC ~ FRANCHISE_AND_FRANCHISE FEE_ORDINANCES SUPPORNIG~ITA 2.6 Continuation of Franchise. If the City and the Company are unable to agree on the terms of a new franchise by the time this franchise expires, this franchise will remain in effect until a new franchise is agreed upon, or until 90 days after the City or Company serves written Notice to the other party of its intention to allow the franchise to expire. SECTION 3. LOCATION, OTHER REGULATIONS. 3.1 Location of Facilities. Electric Facilities shall be located, constructed and maintained so as not to interfere with the safety and convenience of ordinary travel along and over Public Ways and so as not to disrupt or interfere with normal operation of any City Utility System previously installed therein. Electric Facilities shall be located on Public Grounds as determined by the City. Company's construction, reconstruction, operation, repair, maintenance, and location and relocation of Electric Facilities shall be subject to permits if required by separate ordinance and to other reasonable regulations of the City to the extent not inconsistent with the teens of this franchise agreement. Company may abandon underground Electric Facilities in place, provided at the City's request, Company will promptly remove abandoned Electric Facilities interfering with a City improvement project, but only to the extent those Electric Facilities are uncovered by excavation as part of the Ciry improvement project. 3.2 Field Locations and Mapping Information. Company shall provide field locations for its underground Electric Facilities within City, including any abandoned Electric Facilities consistent with the requirements of Minnesota Statutes, Chapter 216D. Company shall provide accurate and current mapping information for any of its Electric Facilities in accordance with Minnesota Rules Parts 7819.4000 and 7819.4100 and other applicable state and federal laws. 3.3 Street Openings. Company shall not open or disturb any Public Way or Public Ground for any purpose without first having obtained a permit from the City, if required by a separate ordinance, for which the City may impose a reasonable fee. Permit conditions imposed on Company shall not be more burdensome than those imposed on other utilities for similar facilities or work. Company may, however, open and disturb any Public Way or Public Ground without permission from the City where an emergency exists requiring the immediate repair of Electric Facilities. In such event Company shall notify the City by telephone to the office designated by the City as soon as practicable. Not later than the second working day thereafter, Company shall obtain any required permits and pay any required fees. 3.4 Restoration. After undertaking any work requiring the opening of any Public Way or Public Ground, Company shall restore the same, including paving and its foundation, in accordance with Minnesota Rules Part 7819.1100, to as good a condition as formerly existed, and shall maintain any paved surface in good condition for two years thereafter. The work shall be completed as promptly as weather permits, and if Company shall not promptly perform. and complete the work, remove all dirt, rubbish, equipment and material, and put the Public Way or Public Ground in the said condition, the City shall have, DOCS-# 145403-v4-WRIGHT- HENNEPIN ELECTRIC_FRANCHISE_AND_FRANCHISE FEE ORDINANCES after demand to Company to cure and the passage of a reasonable period of time following the demand, but not to exceed five days, the right to make the restoration at the expense of Company. Company shall pay to the City the cost of such work done for or performed by the City. This remedy shall be in addition to any other remedy available to the City for noncompliance with this Section 3.4, but the City hereby waives any requirement for Company to post a construction performance bond, certificate of insurance, letter of credit or any other form of security or assurance that may be required, under a separate existing or future ordinance of the City, of a person or entity obtaining the City's permission to install, replace or maintain facilities in a Public Way. 3.5 Avoid Damage to Electric Facilities. Nothing in this Ordinance relieves any person from liability arising out of the failure to exercise reasonable care to avoid damaging Electric Facilities while performing any activity. 3.6 Notice of Improvements. Except in emergencies, the City must give Company reasonable notice of plans for improvements to Public Ways or Public Ground where the City has reason to believe that Electric Facilities may affect or be affected by the improvement. The notice must contain: (i} the nature and character of the improvements, (ii) the Public Ways and Public Grounds upon which the improvements are to be made, (iii} the extent of the improvements, (iv) the time when the City will start the work, and (v) if more than one Public Way or Public Ground is involved, the order in which the work is to proceed. The notice must be given to Company a sufficient length of time in advance of the actual commencement of the work to permit Company to make any necessary additions, alterations or repairs to its Electric Facilities. 3.7 Shared Use of Poles. Company shall make space available on its poles or towers for City fire, water utility, police or other City facilities whenever such use will not interfere with the use of such poles or towers by Company, by another electric utility, by a telephone utility, or by any cable television company or other form of communication company. In addition, the City shall pay for any added cost incurred by Company because of such use by City. SECTION 4. RELOCATIONS. 4.1 Relocation of Electric Facilities in Public Ways. The Company shall comply with Minnesota Rules, Part 7819.3100 and applicable City Ordinances, to the extent consistent with applicable law; regarding use of Public Rights of Way and Public Grounds. If the City determines to vacate a Public Way for a project, or at City's cost to grade, regrade, or change the line of any Public Way, or construct, or reconstruct, or make any improvement to, or within any City Utility System in any Public Way, it may order Company to relocate its Electric Facilities located therein if relocation is reasonably necessary as determined by the City to accomplish the City's proposed public improvement. Except as provided in Section 4.3, Company shall relocate its Electric Facilities at its own expense. The City shall give Company reasonable notice of plans to vacate for a City improvement project, or to grade, regrade, or change the line of any Public Way or to construct or reconstruct any City Utility System. If a relocation is ordered within five years of a prior relocation of the same Electric Facilities, which was made at Company expense, the City shall reimburse Company for non- DOCS-# 145403 -v4-WRIGHT- HENNEPiN ELECTRIC FRANCHISE AND FRANCHISE FEE ORDINANCES SUPPOR~HG DATA betterment costs on a time and material basis, provided that if a subsequent relocation is required because of the extension of a City Utility System to a previously unserved area, Company may be required to make the subsequent relocation at its expense. 4.2 Relocation of Electric Facilities in Public Ground. City may require Company at Company's expense to relocate or remove its Electric Facilities from Public Ground upon a fording by City that the Electric Facilities have become or will become a substantial impairment to the existing or proposed public use of the Public Ground. 4.3 Projects with Federal Funding. Relocation, removal, or rearrangement of any Company Electric Facilities made necessary because of the extension into or through City of a federally aided highway project shall be governed by the provisions of Minnesota Statutes, Section 161.46., as supplemented or amended. It is understood that the right herein granted to Company is a valuable right. City shall not order Company to remove or relocate its Electric Facilities when a Public Way is vacated, improved or realigned because of a renewal or a redevelopment plan which is financially subsidized in whole or in part by the Federal Government or any agency thereof, unless the reasonable non-betterment costs of such relocation and the loss and expense resulting therefrom are first paid to Company, but the City need not pay those portions of such for which reimbursement to it is not available. 4.4 No Waiver. The provisions of this franchise apply only to facilities constructed in reliance on a franchise from the City and shall not be construed to waive or modify any rights obtained by Company for installations within a Company right-of--way acquired by easement or prescriptive right before the applicable Public Way or Public Ground was established, or Company's rights under state or county permit. SECTION 5. TREE TRINIlVIING. Company may trim all trees and shrubs in the Public Ways and Public Grounds of City, but only to the extent Company fords the trimming and cutting necessary to avoid interference with the proper construction, operation, repair and maintenance of any Electric Facilities installed hereunder, provided that Company shall save the City harmless from any liability arising therefrom, and subject to permit or other reasonable regulation by the City. SECTION 6. INDEMNIFICATION. 6.1 Indemnity of City. Company shall indemnify, keep and hold the City free and harmless from any and all liability on account of injury to persons or damage to property occasioned by the construction, maintenance, repair, inspection, the issuance of permits, or the operation of the Electric Facilities located in the Public Ways and Public Grounds. The City shall not be indemnified for losses or claims occasioned through its own negligence except for losses or claims arising out of or alleging the City's negligence as to the issuance of permits for, or inspection of, Company's plans or work. The City shall not be indemnified if the injury or damage results from the performance in a proper manner of acts DOCS-# 145403 -v4-WRIGHT- HENNEPIN ELECTRIC_FRANCHISE_AND_FRANCHISE FEE ORDINANCES reasonably deemed hazardous by Company, and such performance is nevertheless ordered or directed by City after notice of Company's determination. 6.2 Defense of City. In the event a suit is brought against the City under circumstances where this agreement to indemnify applies, Company at its sole cost and expense shall defend the City in such suit if written notice thereof is promptly given to Company within a period wherein Company is not prejudiced by lack of such notice. If Company is required to indemnify and defend, it will thereafter have control of such litigation, but Company may not settle such litigation without the consent of the City, which consent shall not be unreasonably withheld. This section is not, as to third parties, a waiver of any defense or immunity otherwise available to the City; and Company, in defending any action on behalf of the City shall be entitled to assert in any action every defense or immunity that the City could assert in its own behalf. This franchise agreement shall not be interpreted to constitute a waiver by the City of any of its defenses of immunity or limitations on liability under Minnesota Statutes Chapter 466. SECTION 7. VACATION OF PUBLIC WAYS. The City shall give Company at least two weeks prior written notice of a proposed vacation of a Public Way. Except where required for a project, the vacation of any Public Way, after the installation of Electric Facilities, shall not operate to deprive Company of its rights to operate and maintain such Electric Facilities, until the reasonable cost of relocating the same are first paid to Company. In no case, however, shall City be liable to Company for failure to specifically preserve a right of way under Minnesota Statutes, Section 160.29. In accordance with Minnesota Rules, Part 7819.3200, if the City's order directing vacation of the Public Way does not require relocation of the Company's Electric Facilities to prevent interference with a current public improvement, the vacation proceedings shall not be deemed to deprive Company of its right to continue to use the right-of--way of the former Public Way for its Electric Facilities installed prior to such order of vacation. SECTION 8. CHANGE IN FORM OF GOVERNMENT. Any change in the form of government of the City shall not affect the validity of this Ordinance. Any governmental unit succeeding the City shall, without the consent of Company, succeed to all of the rights and obligations of the City provided in this Ordinance. SECTION 9. FRANCHISE FEE. 9.1 Fee Schedule. During the term of the franchise hereby granted, and in lieu of any permit or other fees under ordinance being imposed on Company, the City may impose on Company a franchise fee by collecting the amounts indicated in the Fee Schedule set forth in a separate ordinance from each customer in the designated Company Customer Class. The parties have agreed that the franchise fee collected by the Company and paid to the City in accordance with this Section 9 shall not exceed the following amounts. DOCS-# 145403-v4-WRIGHT- HENNEPIN_ELECTRIC FRANCHISE AND_FRANCHISE FEE_ORDINANCES Franchise F ee WH Rate Descri tion Code Com Went Service T e Fee 01 Residential Residential 10 16 20 02 Residential -Seasonal $1.95 Small C&I no- 03 Irrigation 04 Comm -Indust 1000 demand 10 16 13 30 40 TV KVA or less $5.50 30, 40, 50, 51, 55, 60, 61 04 Comm -Indust 1000 C&I Demand KVA or less $31.00 40, 50, 51, 55, 60, 61 05 Comm -Indust over 1001 Lar a C&I Demand KVA $190.00 Public Street Li htin component type =light descri tion 06 Public Street & Hwy Li htin $12.00 03 Irrigation 04 Comm -Indust 1000 KVA or less 05 Comm -Indust over 1001 Munici al um in 10, 13, 50, 55, 60 KVA $31.00 wri rates nave riders that are applicable per customers' site service options 9.2 Separate Ordinance. The franchise fee shall be imposed by a separate ordinance duly adopted by the City Council, which ordinance shall not be adopted until at least 60 days after written notice enclosing such proposed ordinance has been served upon Company by certified mail. The fee shall not become effective until the beginning of a Company billing month at least 60 days after written notice enclosing such adopted ordinance has been served upon Company by certified mail. Section 2.5 shall constitute the sole remedy for solving disputes between Company and the City in regard to the interpretation of, or enforcement of, the separate ordinance. No action by the City to implement a separate ordinance will commence until this Ordinance is effective. A separate ordinance which imposes a lesser franchise fee on the residential class of customers than the maximum amount set forth in Section 9.1 above shall not be effective against Company unless the fee imposed on each other customer classification is reduced proportionately in the same or greater amount per class as the reduction represented by the lesser fee on the residential class. 9.3 Terms Defined. For the purpose of this Section 9, the following definitions apply: 9.3.1 "Customer Class" shall refer to the classes listed on the Fee Schedule and as defined or determined in Company's electric tariffs adopted by the Company. 9.3.2 "Fee Schedule" refers to the schedule in Section 9.1 setting forth the various customer classes from which a franchise fee would be collected if a separate ordinance were implemented immediately after the effective date of this franchise agreement. The Fee Schedule in the separate ordinance may include new Customer Class added by Company to its electric tariffs after the effective date of this franchise agreement. r~ DOCS-# 145403 -v4-WRIGHT- HENNEPIN ELECTRIC_FRANCHISE_AND_FRANCHISE FEE ORDINANCES 9.4 Collection of the Fee. The franchise fee shall be payable quarterly and shall be based on the amount collected by Company during complete billing months during the period for which payment is to be made by imposing a surcharge equal to the designated franchise fee for the applicable customer classification in all customer billings for electric service in each class. The payment shall be due the last business day of the month following the period for which the payment is made. The franchise fee may be changed by ordinance from time to time; however, each change shall meet the same notice requirements and not occur more often than annually and no change shall require a collection from any customer for electric service in excess of the amounts specifically permitted by this Section 9. No franchise fee shall be payable by Company if Company is legally unable to first collect an amount equal to the franchise fee from its customers in each applicable class of customers by imposing a surcharge in Company's applicable rates for electric service. Company may pay the City the fee based upon the surcharge billed subject to subsequent reductions to account for uncollectibles, refunds and correction of erroneous billings. Company agrees to make its records available for inspection by the City at reasonable times provided that the City and its designated representative agree in writing not to disclose any information which would indicate the amount paid by any identifiable customer or customers or any other information regarding identified customers. In addition, the Company agrees to provide at the time of each payment a statement summarizing how the franchise fee payment was determined, including information showing any adjustments to the total surcharge billed in the period for which the payment is being made to account for any uncollectibles, refunds or error corrections. 9.5 Equivalent Fee Requirement. The separate ordinance imposing the fee shall not be effective against Company unless it lawfully imposes and the City monthly or more often collects a fee or tax of the same or greater equivalent amount on the receipts from sales of energy within the City by any other energy supplier, provided that, as to such a supplier, the City has the authority to require a franchise fee or to impose a tax. The "same or greater equivalent amount" shall be measured, if practicable, by comparing amounts collected as a franchise fee from each similar customer, or by comparing, as to similar customers the percentage of the annual bill represented by the amount collected for franchise fee purposes. The franchise fee or tax shall be applicable to energy sales for any energy use related to heating, cooling or lighting, or to run machinery and appliances, but shall not apply to energy sales for the purpose of providing fuel for vehicles. If the Company specifically consents in writing to a franchise or separate ordinance collecting or failing to collect a fee from another energy supplier in contravention of this Section 9.5, the foregoing conditions will be waived to the extent of such written consent. 9.6 Exception to Equivalent Fee Requirement. The requirement in Section 9.5 to impose an equivalent fee on any other energy supplier does not apply if the City uses the franchise fee collected for no purpose other than betterment of the Electric Facilities, including such things as relocating poles, placing the Electric Facilites underground or installing lighting above ground or to pay charges for the operations and maintenance of the streetlight system installed in Company's service territory in the City, and incorporates the provisions of this Section 9.6 by reference or restatement. If the City wishes to take advantage of this exception, the City must separately account for all franchise fees received from Company. The City must provide a report to Company no later than 30 days after the due date for each franchise fee payment indicating the current balance of the franchise fee DOCS-# 145403 -v4-WRIGHT- HENNEPIN ELECTRIC FRANCHISE AND FRANCHISE FEE ORDINANCES SUPPORTING D~T>~ account, the expenditures from the account since the last report, the budgeted expenditures from the account for the current calendar year, and the amount committed by contract for expenditures in the current budget year. The City will promptly give Notice to Company if and when the unallocated balance reaches $500,000. The unallocated balance means the balance minus any amounts committed by contract for expenditures. Upon receiving this Notice, Company will cease collection at the end of the first full monthly billing cycle, which occurs after receipt of the Notice and thereafter Company will have no further obligation to pay the franchise fee to the City until the first billing month commencing 90 days after Notice that the unallocated balance has fallen below $150,000. The City will have no obligation to return any amount which exceeds the $500,000 unallocated balance or any balance remaining upon any repeal of the separate ordinance by the City, provided such balance will be reinstated by the City to the separate account if said separate ordinance is subsequently reenacted. Any franchise fee imposed on Company as authorized by this Section 9.6 shall be the exclusive fee payable by Company under this franchise until the City, by ordinance, repeals the separate ordinance imposing the fee under this Section 9.6. SECTION 10. PROVISIONS OF ORDINANCE. 10.1 Severability. Every section, provision, or part of this Ordinance is declared separate from every other section, provision, or part; and if any section, provision, or part shall be held invalid, it shall not affect any other section, provision, or part. Where a provision of any other City ordinance conflicts with the provisions of this Ordinance, the provisions of this Ordinance shall prevail. 10.2 Limitation on Applicability. This Ordinance constitutes a franchise agreement between the City and Company as the only parties and no provision of this franchise shall in any way inure to the benefit of any third person (including the public at large) so as to constitute any such person as a third party beneficiary of the agreement or of any one or more of the terms hereof, or otherwise give rise to any cause of action in any person not a party hereto. SECTION 11. AMENDMENT PROCEDURE. Either party to this franchise agreement may at any time propose that the agreement be amended to address a subject of concern and the other party will consider whether it agrees that the amendment is mutually appropriate. If an amendment is agreed upon, this Ordinance maybe amended at any time by the City passing a subsequent ordinance declaring the provisions, of the amendment, which amendatory ordinance shall become effective upon the filing of Company's written consent thereto with the City Clerk within 90 days after the date of final passage by the City of the amendatory ordinance. DOCS-# 145403-v4-WRIGHT- HENNEPIN_ELECTRIC_FRANCHISE_AND_FRANCHIS E_FEE_ORDINANCES SECTION 12. PREVIOUS FRANCHISES SUPERSEDED. This franchise supersedes any previous electric franchise granted to Company or its predecessor. Passed and approved: 2009 Clint Herbst, Mayor Attest: Dawn Grossinger, City Clerk DOC S-# 145403 -v4-WRIGHT- HENNEPIN ELECTRIC FRANCHISE AND FRANCHISE FEE ORDINANCES SUPPORIAI6~IT1 ORDINANCE NO. 499 CITY OF MONTICELLO WRIGHT COUNTY, MINNESOTA ELECTRIC FRANCHISE FEE ORDINANCE AN ORDINANCE AMENDING TITLE 8, CHAPTER 7 OF THE CITY CODE, IMPOSING AN ELECTRIC SERVICE FRANCHISE FEE ON WRIGHT -HENNEPIN COOPERATIVE ELECTRIC ASSOCIATION, ITS SUCCESSORS AND ASSIGNS, FOR PROVIDING ELECTRIC SERVICE WITHIN THE CITY PURSUANT TO ITS FRANCHISE THE CITY COUNCIL OF THE CITY OF MONTICELLO, WRIGHT COUNTY, MINNESOTA, ORDAINS: TITLE 8, CHAPTER 7 OF THE CITY CODE IS AMENDED BY ADDING THE FOLLOWING SECTIONS: SECTION 8-7-13. Franchise Fee. During the term of the franchise granted by Ordinance No 499 to WRIGHT-HENNEPIN COOPERATIVE ELECTRIC ASSOCIATION, its successors and assigns (Company), and subject to the terms and conditions specified in that Ordinance, in particular Section 8-7-9, the City hereby imposes on Company a franchise fee determined by collecting the amounts indicated in the following Fee Schedule from each customer in the designated Company Customer Class as defined in tariffs approved by the Company Board of Directors. Franchise Fee WH Rate Monthly Descri tion Code Com onent Service T Fee 01 Residential Residential 10 16 20 02 Residential -Seasonal $1.95 03 Irrigation Small C&I no- 04 Comm -Indust 1000 demand 10 16 13 30 40 N KVA or less $5.50 30, 40, 50, 51, 55, 60, 61 04 Comm -Indust 1000 C&I Demand KVA or less $31.00 40, 50, 51, 55, 60, 61 05 Comm -Indust over 1001 Lar a C&I Demand KVA $190.00 Public Street component type =light 06 Public Street & Hwy Li htin dexri tion Li htin $12.00 03 Irrigation 04 Comm -Indust 1000 KVA or less 05 Comm -Indust over 1001 Munici al um in 10, 13, 50, 55, 60 KVA $31.00 WH rates have riders that are applicable per customers' site service options DOCS-# 145403-v4-WRIGHT- HENNEPIN ELECTRIC FRANCHISE AND FRANCHISE FEE ORDINANCES SECTION 8-7-14. Collection of the Fee. The fee is an account-based fee on each premise and not ameter-based fee. In the event that an entity covered by this ordinance has more than one meter at a single premise, but only one account, only one fee shall be assessed to that account. If a premise has two or more meters being billed at different rates, the Company may have an account for each rate classification, which will result in more than one franchise fee assessment for electric service to that premise. If the Company combines the rate classifications into a single account, the franchise fee assessed to the account will be the largest franchise fee applicable to a single rate classification for energy delivered to that premise. In the event any entities covered by this ordinance have more than one premise, each premise (address) shall be subject to the appropriate fee. In the event a question arises as to the proper fee amount for any premise, the Company's manner of billing for energy used at all similar premises in the City will control. SECTION 8-7-15. Payment of the Fee. The franchise fee shall be payable by the Company quarterly and shall be based on the amount collected by Company during complete billing months during the period for which payment is to be made by imposing a surcharge equal to the designated franchise fee for the applicable customer classification in all customer billings for electric service in each class. The payment shall be due the last business day of the month following the period for which the payment is made. No franchise fee shall be payable by Company if Company is legally unable to first collect an amount equal to the franchise fee from its customers in each applicable class of customers by imposing a surcharge in Company's applicable rates for electric service. Company may pay the City the fee based upon the surcharge billed subject to subsequent reductions to account for uncollectibles, refunds and correction of erroneous billings. The Company shall provide at the time of each payment a statement summarizing how the franchise fee payment was determined, including information showing any adjustments to the total surcharge billed in the period for which the payment is being made to account for any uncollectibles, refunds or error corrections. Company shall make its records available for inspection by the City at reasonable times. SECTION 8-7-16. Surcharge. The City recognizes that the Company will add a surcharge to customer rates to reimburse Company for the cost of the fee and that Company will surcharge its customers in the City for the amount of the fee. SECTION 8-7-17. Enforcement. Any dispute, including enforcement of a default regarding this ordinance will be resolved in accordance with Section 2.5 of the Franchise Agreement. SECTION 8-7-18. Effective Date. The franchise fee shall be become effective after publication and sixty (60) days after written notice to the Company as provided in the Franchise, and thereupon collection of the fee for all Customer Classes shall commence at the beginning of the Company's 2009 billing month. SECTION 8-7-19. Sunset Clause. This ordinance shall automatically terminate upon the termination of any franchise granted to the Company. DOCS-# 145403-v4-WRIGHT- HENNEPIN_ELECTRIC_FRANCHISE_AND_FRANCHISE FEE_ORDINANCES Passed and approved: Attest: Dawn Grossinger, City Clerk _~ suPromuica~ra Clint Herbst, Mayor DOCS-# 145403-v4-WRIGHT- HENNEPIN_ELECTRIC_FRANCHIS E_AND_FRANCHISE_FEE_ORDINANCES PUBLICATION SUMMARY OF ORDINANCES NO. 498 AND 499 CITY OF MONTICELLO WRIGHT COUNTY, MINNESOTA OfFFICIAL SUMNIMARY FOR PUBLICATION ORDINANCES GRANTING ANON-EXCLUSIVE FRANCHISE TO, AND ESTABLISHING A FRANCHISE FEE FOR, WRIGHT-HENNEPIN COOPERATIVE ELECTRIC ASSOCIATION Ordinance Number 498 grants Wright-Hennepin Inc. anon-exclusive franchise to construct and operate facilities and equipment for the transportation, distribution and sale of electricity within the City and authorization to use public ways and public ground for such purpose. The term of the franchise is twenty (20) years. The franchise ordinance provides for regulations regarding the location and relocation of Wright-Hennepin electric facilities within public rights of way and on public grounds, and includes provisions regarding insurance and indemnification, tree trimming, vacation of public ways, and other matters pertaining to the transmission and distribution of electricity to customers within the City. Ordinance Number 499 imposes a franchise fee on the electric service provided by Wright-Hennepin. The franchise fee established is $1.95 per month for residential and $5.50 for small commercial and industrial (C & I) (no-demand), and $31.00 and $190.00 per month for C & I Demand and Large C & I Demand, respectively, according to WH Rate Code/Component Tables. Printed copies of both ordinances are available for inspection by any person during the City Hall regular office hours. Approved for publication by the City Council of the City of Monticello, Minnesota this day of , 2009. CITY OF MONTICELLO By: Clint Herbst, Mayor ATTEST: Dawn Grossinger, City Clerk DOC S-# 145403 -v4-WRIGHT- HENNEPIN ELECTRIC FRANCHISE AND FRANCHISE FEE ORDINANCES Wright-Hennepin Cooperative Electric Aseocfatlon A'Ccwchstcne Emrgy`Qxiperative ~( Board Dirocten • Chris ~. I.anrro, Chair .4nmxrAak, t1~IN • Thomas B. btach, Vice CFutir tlla~i/tr./DCC, [111 ,t • Dale F. Jars, Secredry-Treasurer Baffa/6, ASV • rtmod,~ r_ Yrwng, ArorraxQole, MN • Burch ~. lindenfelser, hlartx/b d-L~1 • Barron R Hoesch, 1-IoumniLa.Fr, i4lN • Sarah L Er-cnson, Plymmrrb,: b~I • Dunatd ~. Luca,, NIu/aE Cinrz, ~YIIV SUPPOATING~ITI June 1, 2009 Robert Paschke Public Works Director City of Monticello 909 Galf Course Road Monticello, MN 55362 Dear Mr. Paschke, The estimated quarterly fees Wright-Hennepin Cooperative Electric Association (V1/H) will collect from WH customers located within the City of Monticello under the proposed Franchise Fee Ordinance will be $3,951.75. As discussed during our meeting on April 22"d, we wish to state for • EcickJ. Fleinz, ~,m,~„, ho,; the record that we philosophically disagree with being made into a tax PrsQaenf ~ oEO collector. If Cities need to increase revenues, they should be forthright with their citizens and bill them on the tax statement as ~~ F. ~'~~ opposed to making utilities collect taxes farthe cities. When the AxxmAnh,:blN Franchise Fee Ordinance goes into effect, WH customers in Monticello will see a new line item on their electric statements that will say "City of Monticello Franchise Fee" as a way to explain the increase in their power bHls. Just for your information., these members within your city limits will be the only Wright-Hennepin customers who are billed a Franchise Fee on their electric bill. Sincerely, ance Hovland VP Energy Distribution ~ty fAENRes ,~ -. HF+xrta~o ~~ HStxur ~ p~Tnse ~'nCorT7t1't 1IILHGeneration MlH Response E.It.EfRtt, ___. ...., ,~.. ..,..,,_ .~.~~ ,u...,rt _ stR~rct~ r•<•, ay PO Box 330 • Rcciiford M,C`! .55373 0330 • vww whe.arg • Metro 763 477 3000 • Toil Free 1-$(7Q-4d3-2567 • 24 Hour Fax 763-477-3054 Council Agenda - 06/08/2009 10. Consideration of Establishment of a an Ordinance Granting CenterPoint Energy a non-exclusive Franchise to Utilize Rights of Way and Public Grounds in providing service. (JO) A. BACKGROUND INFORMATION: This is an important housekeeping item that results in re-establishment of an ordinance that has recently sunsetted. The ordinance grants CenterPoint Energy a nonexclusive franchise to construct, operate, repair and maintain a gas distribution system. It is very similar to the previous ordinance with modifications made to make it consistent with State of Minnesota Right of Way rules. This ordinance has been prepared by Joel Jamnik on the behalf of the City of Monticello and in conjunction with serving a similar need for other cities. Joel's effort included significant input from CenterPoint Energy and thus is being used as a "model" ordinance. Please note that at an upcoming meeting, Council will be asked to consider if it wishes to establish a franchise fee associated with granting CenterPoint the right to use the right of way. Staff is currently researching the costs associated with monitoring the use of the right of way by CenterPoint along with other associated costs and will be forwarding options. Our research will also include a summary of what other Cities have been charging. B. ALTERNATIVES: Motion to adopt Gas Franchise Ordinance No. 500. 2. Motion to table or deny adoption of Ordinance No.500. C. STAFF RECOMMENDATION: Staff recommends alternative 1 and will be presenting options in the near future for establishment of an ordinance requiring payment of a franchise fee for use of the right of way. D. SUPPORTING DATA: Copy of Ordinance #500 Granting CenterPoint Energy aNon-exclusive Franchise to use the Right of Way. Copy of template for Ordinance Establishing a Franchise Fee for consideration at an upcoming meeting. CITY OF MONTICELLO, WRIGHT COUNTY, MINNESOTA ORDINANCE NO. 500 GAS FRANCHISE ORDINANCE--CENTERPOINT ENERGY AN ORDINANCE GRANTING CENTERPOINT ENERGY RESOURCES CORP., d/b/a CENTERPOINT ENERGY MINNESOTA GAS ("CENTERPOINT ENERGY"), ITS SUCCESSORS AND ASSIGNS, A NONEXCLUSIVE FRANCHISE TO CONSTRUCT, OPERATE, REPAIR AND MAINTAIN A GAS DISTRIBUTION SYTEM INCLUDING NECESSARY GAS MAINS, PIPES AND EQUIPMENT FOR THE TRANSPORTATION, DISTRIBUTION AND SALE OF GAS FOR PUBLIC AND PRIVATE USE AND TO USE PUBLIC WAYS AND PUBLIC GROUNDS OF THE CITY FOR SUCH PURPOSES; AND PRESCRIBING CERTAIN TERMS AND CONDITIONS THEREOF. THE CITY OF MONTICELLO ORDAINS: SECTION 1. DEFINITIONS. For purposes of this Ordinance, the following capitalized terms shall have the following meanings: 1.1. City. The City of Monticello, County of Wright, State of Minnesota. 1.2. City Utility System. Facilities used for providing public utility service owned or operated by the City or agency thereof. 1.3. Commission. The Minnesota Public Utilities Commission, or any successor agency or agencies, including an agency of the federal government that preempts all or part of the authority to regulate gas retail rates now vested in the Commission. 1.4. Company. CenterPoint Energy Resources Corp., d/b/a CenterPoint Energy Minnesota Gas ("CenterPoint Energy"), its successors and assigns, including successors to assignees of those portions of the Company that constitute any part or parts of the Gas Facilities subject to this franchise. 1.5. Effective Date. The date on which the ordinance becomes effective under Section 2.2. 1.6. Gas. Natural gas, manufactured gas, mixture of natural gas and manufactured gas or other forms of gas energy. 1.7. Gas Facilities. Gas transmission and distribution pipes, mains, lines, ducts, fixtures, and all necessary facilities, equipment and appurtenances owned, operated or otherwise used by the Company for the purpose of providing gas energy for public use, but not including any gas manufacturing, processing or storage facilities. 1.8. Notice. A writing served by a party or parties on another party or parties. Notice to Company must be mailed to: CenterPoint Energy Minnesota Division Vice President 800 LaSalle Avenue Minneapolis, MN 55402 Notice to City must be mailed to: City of Monticello 505 Walnut Avenue, Ste 1 Monticello, Minnesota 55362-8822 1.9. Public Way. Any street, alley or other public right-of--way within the City as defined in Minn. Stat. § 237.162, Subd. 3. 1. l O.Public Ground. Land owned or otherwise controlled by the City for parks, open space or other public purposes, which is held for use in common by the public. SECTION 2. FRANCHISE. 2.1 Grant of Franchise. The City grants the Company, for a period often (10) years from the Effective Date, the right to import, transport, distribute and sell Gas for public and private use within and through the limits of the City. This right includes the provision of Gas that is (i) manufactured by the Company or its affiliates and delivered by the Company, (ii) purchased and delivered by the Company or (iii) purchased from another source by the retail customer and delivered by the Company. For these purposes, the Company may construct, operate, repair and maintain Gas Facilities in, on, over, under and across the Public Way and Public Ground subject to the provisions of state law, this ordinance and to provisions of other city right-of--way ordinances including permit and fee requirements, as the same maybe amended, supplemented or replaced. The Company shall be notified sixty (60) days in advance of any adoption of, or proposed changes to, any City ordinance regulating its Public Ways or modifying permit or fee requirements of the Company. The service to be provided and the rates to be charged by Company for gas service in the City are subject to the jurisdiction of the Commission. 2.2 Effective Date. This franchise is effective upon passage and publication as required by law and its acceptance by the Company. Written acceptance or rejection of the franchise by the Company must be filed with the City Clerk within sixty (60) days after written submission of a draft of this ordinance to the Company. 2.3 Non exclusive Franchise. This ordinance does not grant an exclusive franchise. 2.4 Legal Fees. Each party is responsible for its own legal fees incurred related to granting of this franchise. 2.5 Publication Expense. The expense of publication of this ordinance must be paid by the Company. 2.6 Default: Dispute Resolution. If the City or Company asserts that the other party is in default in the performance of any obligation hereunder, the complaining party must notify the other party in writing of the default and the desired remedy. Representatives of the parties must promptly meet and attempt in good faith to negotiate a resolution of the dispute. If the dispute is not resolved within thirty (30) days after service of the notice, the parties may jointly select a mediator to facilitate further discussion. The parties will equally share the fees and expenses of the mediator. If a mediator is not used or if the parties are unable to resolve the dispute within thirty (30) days after first meeting with the mediator, either party may commence an action in District Court to interpret and enforce this franchise or for such other relief as may be permitted by law or equity. 2.7 Continuation of Franchise. If this franchise expires and the City and the Company are unable to agree on the terms of a new franchise, the existing franchise will remain in effect until a new franchise is agreed upon, or until ninety (90) days after the City or the Company serves written Notice to the other party of their intention to allow the franchise agreement to expire. SECTION 3. CONDITIONS OF USE. 3.1 Location of Facilities. Gas Facilities must be located, constructed, installed and maintained so as not to interfere with the City Utility System or the safety and convenience of ordinary travel along and over Public Ways. The Company is not required to use Public Grounds or Public Ways exclusively for the location of its Gas Facilities, but is subject to all other police power regulations for other locations within the City. Gas Facilities may be located on Public Grounds as determined by the City. The Company's construction, reconstruction, operation, repair, maintenance and location of Gas Facilities is subject to any permit requirements and other reasonable regulations required by other ordinances and regulations of the City. 3.2 Field Location. Upon request by the City, the Company must provide field locations for any of its Gas Facilities within the period of time required by Minnesota State Statute 216D. Subject to the Homeland Security Act or other applicable laws protecting confidential or proprietary information, the Company must promptly provide mapping information for any of its underground Gas Facilities and shall otherwise in all respects comply with Minnesota rules Parts 7819.4000 and 7819.4100. 3.3 Permit Required. The Company may not open or disturb the surface of any Public Way or Public Ground without first having obtained a permit from the City, for which the City may impose a reasonable fee irrespective of any franchise fee imposed pursuant to Section 7. Company will comply with all permit conditions established by the City. The permit conditions and fees imposed on the Company may not be more burdensome than those imposed on other utilities for similar facilities or work, however, when establishing permit fees, the City may take into account the renewal dates of existing franchises and whether the Company is also paying a franchise fee to the City. The Company may, however open and disturb the surface of any Public Way or Public Ground without a permit if (i) an emergency exists requiring the immediate repair of Gas Facilities and (ii) the Company gives notice to the City before, if possible, commencement of the emergency repair. Within two (2) business days after commencing the repair, the Company must apply for any required permits and pay the required fees. Except in the case of emergency work, work undertaken without a permit by the Company or its agents shall be subject at the discretion of the City to a penalty in the amount of twice the established permit fees in addition to any other remedy or penalty specified or allowed in City Code or State Rules. 3.4 Restoration. After completing work requiring the opening of a Public Way or Public Ground, the Company must restore the same, including paving and its foundation, to the condition specified in the permit which must not be inconsistent with Minnesota Rules 7819.1100, and maintain the restored areas in good condition for one (1) year thereafter. The work must be completed as promptly as weather permits. If the Company does not promptly perform and complete the work, remove all dirt, rubbish, equipment and material, and restore the Public Way or Public Ground, the City may, after demand to the Company to cure and the passage of a reasonable period of time not less than five calendar days following the demand, make the restoration at the expense of the Company. The Company must pay to the City the cost of such work done for or performed by the City, including administrative expense and overhead. This remedy is in addition to any other remedies available to the City for noncompliance with this section. In all other aspects, Company shall comply with the terms of Minnesota Rules 7819.1100 for restoration of Public Ways and Grounds, and Minnesota Rules 7819.3000 and 7819.0100. 3.5 Company Protection of Gas Facilities in Public Ways. The Company must take reasonable measures to prevent the Gas Facilities from causing damage to persons or property. The Company must take reasonable measures to protect the Gas Facilities from damage that could be inflicted on the Facilities by persons, property or the elements. The Company and the City will comply with all applicable laws and codes when performing work near the Gas Facilities. 3.6 Notice of Improvements. The City must give the Company reasonable notice of plans for improvements to Public Ways or Public Ground where the City has reason to believe that Gas Facilities may affect or be affected by the improvements. The notice must contain; (i) the nature and character of the improvements, (ii) the 4 Public Ways or Public Grounds upon which the improvements are to be made, (iii) the extent of the improvements, (iv) the time when the City will start the work, and, (v) if more than one Public Way or Public Ground is involved, the order in which the work is to proceed. The notice must be given to the Company a sufficient length of time in advance of the actual commencement of the work to permit the Company to make any necessary additions, alterations, or repairs to its Gas Facilities SECTION 4. RELOCATIONS. 4.1. Relocation of Gas Facilities. Relocation of Gas Facilities in Public Ways shall be subject to Minnesota Rules, part 7819-3100 and any applicable City right-of--way ordinances consistent with law. The City may require the Company at Company's expense to relocate or remove its Gas Facilities from Public Grounds upon a finding that the Gas Facilities have become or will become a substantial impairment to the existing or imminent public use of the Grounds. 4.2 Vacation of Public Ways. The City must give the Company at least two weeks written Notice of the proposed vacation of a Public Way. The City and the Company shall comply with Minnesota Statute § 160.29 and Minnesota Rules, 7819-3200 and applicable right-of--way City ordinances consistent with law. 4.3 Projects with Federal Funding. Relocation, removal or rearrangement of any Gas Facilities made necessary because of the extension into or through the City of a federally-aided highway project shall be governed by the provisions of Minnesota Statutes, Section 161.46 if funds for these purposes are available. SECTION 5. DEFENSE AND INDEMNIFICATION. 5.1 Terms. The Company shall indemnify, keep and hold the City, its elected officials, officers, employees, and agents free and harmless from any and all claims and actions on account of injury or death of persons or damage to property occasioned by the construction, maintenance, repair, removal, on or across the Public Ways and the Public Grounds. The City will not be indemnified for losses or claims alleged to be the result of negligence of the City, its elected officials, employees, officers, or agents, except for those arising out of the issuance of permits for, or inspection of the Company's plans or work. The City shall not be entitled to reimbursement for its costs incurred prior to notification to the Company of claims or actions and a reasonable opportunity for the Company to accept and undertake the defense. 5.2 Litigation. If such a suit is brought against the City under circumstances where the agreement in this Section 5 to indemnify applies, the Company at its sole cost and expense will defend the City in such suit if Notice thereof is promptly given to the Company within a reasonable period. If the Company is required to indemnify and defend, it will thereafter have control of such litigation, but the Company may not settle such litigation without the consent of the City, which consent will not be unreasonably withheld. This section is not as to third parties a waiver of any defense or immunity otherwise available to the City; and the Company, in defending any action on behalf of the City is entitled to assert in any action every defense or immunity that the City could assert in its own behalf. SECTION 6. SUCCESSORS IN INTEREST. 6.1 This ordinance and the rights and obligations conferred hereby, is binding on and inures to the benefit of the City and its successors and on the Company and its successors and permitted assigns. SECTION 7. FRANCHISE FEE. 7.1 Separate Ordinance. The City reserves all rights under Minnesota Statutes, §216B.36, §301B.01 or other law to require a franchise fee at any time during the term of this franchise. The franchise fee must be imposed by a separate ordinance adopted by the City Council, which ordinance may not be adopted until at least sixty (60) days after Notice enclosing such proposed ordinance has been served upon the Company by certified mail. A fee imposed under this section does not become effective until sixty (60) days after Notice enclosing the adopted ordinance has been served upon the Company by certified mail. SECTION 8. LIMITATION ON APPLICABILITY. 8.1 Limitation on Applicability. This Ordinance constitutes a franchise agreement between the City and the Company. No provision of this franchise inures to the benefit of any third person, including the public at large, so as to constitute any such person as a third-party beneficiary of the agreement or of any one or more of the terms hereof, or otherwise give rise to any cause of action for any person not a party hereto. SECTION 9. PREVIOUS FRANCHISES SUPERSEDED. 9.1 Previous Franchises superseded. This franchise supersedes and replaces previous franchises granted to the Company or its predecessors, including but not limited to Ordinance Number 83-03. SECTION 10. AMENDMENTS. 10.1 Amendments. Either party to this franchise agreement may at any time propose that the agreement be amended. This Ordinance may be amended at any time by the City passing a subsequent ordinance declaring the provision of the amendment, which amendatory ordinance shall become effective upon the filing of the Company's written consent thereto with the City Clerk within 60 days after the effective date of the amendatory ordinance. SECTION 11. SEVERABILITY. 11.1 Severability. If any portion of this franchise is found unenforceable for any reason, the validity of the remaining provisions will not be affected. Adopted this day of , 200_ by the City Council of the City of Monticello, Minnesota. CITY OF MONTICELLO City of Monticello, Mayor ATTEST: City of Monticello, City Clerk ACCEPTANCE OF ORDINANCE Pursuant to Section 2.2 of Ordinance Number ,passed by the City Council of the City of Monticello on the day of , 200_, and duly published in the official newspaper of the City on the day of , 200_, CenterPoint Energy Resources Corp.,d/b/a CenterPoint Energy Minnesota Gas ("CenterPoint Energy") for itself, its successors and assigns, accepts said franchise ordinance upon the terms and conditions contained therein. Executed this day of , 200_. David Baker, Vice President MN Division CenterPoint Energy STATE OF MINNESOTA ) COUNTY OF ( ss. The foregoing instrument was acknowledged before me this 200_, by and by day of the and of CenterPoint Energy Resources Corp., d/b/a CenterPoint Energy Minnesota Gas ("CenterPoint Energy") on behalf of the corporation. Notary Public ~~~~k ~^ ~lo~ ~~ ~~aPt~~ ~RO,~w~ °~ ~~~~a9 AN ORDINANCE IMPLEMENTING A GAS ENERGY FRANCHISE FEE ON CENTERPOINT ENERGY MINNESOTA GAS ("CENTERPOINT ENERGY") FOR PROVIDING GAS ENERGY SERVICE WITHIN THE CITY OF THE CITY OF DOES ORDAIN: Gas Franchise Fee (a) Definitions. For the purposes of this Ordinance, the following terms shall have the following meanings: (1) City. The City of , County of ,State of Minnesota. (2) Company. CenterPoint Energy Minnesota Gas ("CenterPoint Energy"), its successors and assigns. (3) Franchise Agreement. The franchise agreement between the City and Company pursuant to City Ordinance (4) Notice. "Notice" means a writing served by any party or parties on any other party or parties. Notice to Company shall be mailed to CenterPoint Energy, Minnesota Division Vice President, 800 LaSalle Avenue, Minneapolis, MN 55402. Notice to City shall be mailed to the City Clerk at (b) Purpose. The City Council has determined that it is in the best interest of the City to impose a franchise fee on those public utility companies that provide natural gas and electric services within the City. Pursuant to the Franchise Agreement the City has the right to impose a franchise fee on Company. (c) Franchise Fee Statement and Schedule. A franchise fee is hereby imposed on Company commencing with the billing month, and in accordance with the following fee schedule: 1 Customer Classification Residential Firm A Firm B Firm C Small Volume, Dual Fuel A ("SVDF A") Small Volume, Dual Fuel B ("SVDF B") Large Volume, Dual Fuel ("LVDF") Amount per Account per Month ($) $ per month $ per month $ per month $ per month $ per month $ per month $ per month (d) Account Fee. This fee is an account based fee and not ameter-based fee. In the event that an entity covered by this ordinance has more than one meter, but only one account, only one fee shall be assessed to that account. In the event any entities covered by this ordinance have more than one account, each account shall be subject to the appropriate fee. In the event a question arises as to the proper fee amount for any account, the highest possible fee amount shall apply. (e) Payment. Franchise fees are to be collected by the Company and submitted to the City as follows: January -March collections due by April 30. April -June collections due by July 31. July -September collections due by October 31. October -December collections due by January 31. (f) Record Support for Payment. The Company shall make each payment when due and, if requested by the City, shall provide a statement summarizing how the franchise fee payment was determined, including information showing any adjustments to the total made to account for any non-collectible accounts, refunds or error corrections. The Company shall permit the City, and its representatives, access to the Company's records for the purpose of verifying such statements. (g) Payment Adjustments. Payment to the City will be adjusted where the Company is unable to collect the franchise fee. This includes non-collectible accounts. (h) Surcharge. The City recognizes that the Minnesota Public Utilities Commission allows the Company to add a surcharge to customer rates to reimburse the Company for the cost of implementing and administering the fee. (i) Dispute Resolution. If either party asserts that the other party is in default in the performance of any obligation hereunder, the complaining party shall notify the other party of the default and the desired remedy. The notification shall be written. Representatives of the parties must promptly meet and attempt in good faith to negotiate a resolution of the dispute. If the dispute is not resolved within 30 days of the written notice, the parties may jointly select a mediator to facilitate further discussion. The parties will equally share the fees and expenses of this mediator. If a mediator is not used or if the parties are unable to resolve the dispute within 30 days after first meeting with the 2 selected mediator, either party may commence an action in District Court to interpret and enforce this ordinance or for such other relief permitted bylaw. (j) Effective Date of Franchise Fee. The effective date of this Ordinance shall be after its publication and sixty (60) days after the sending of written notice enclosing a copy of this adopted Ordinance to Company by certified mail. Collection of the fee shall commence as provided above. (k) Relation to Franchise Agreement. This ordinance is enacted in compliance with the Franchise Agreement and shall be interpreted as such. (1) Periodic Review. The City Council shall review this ordinance every two years in whatever manner the City Manager then determines to be appropriate, including, but not limited to, review by the City Council in either a work session or a regular session. Failure to review this ordinance shall not in any way invalidate or limit it. (m) Permit Fees. The Company will administer the collection and payment of franchise fees to the City in lieu of permit fees, or other fees that may otherwise be imposed on the Company in relation to its operations as a public utility in the City so long as the following requirements are met: (1) The Company applies for any and all permits, licenses and similar documentation as though this provision did not exist. (2) The Company requests the fee to be waived at the time of application. Section 2: Effective Date. This ordinance takes effect as provided herein. PASSED AND ADOPTED BY THE CITY COUNCIL THIS DAY OF 2003. ATTEST: City Clerk Mayor (Published in the the day of 3 Council Agenda: June 8, 2009 11. Consideration to review the application of trunk water and sanitary sewer charges as related to a building permit for JME Companies. (AS/BW) A. REFERENCE AND BACKGROUND The City Council is asked to consider the application of trunk sanitary, trunk storm and trunk water fees as they relate to new development at an industrial property located. at 1401 Fallon Avenue, which is JME of Monticello. In February, 2009, JME received a building permit to construct a storage facility on the site of their current industrial facility. At the time the project was being considered, staff brought the item forward to the City Council for review of the structure type. This was due to the fact that this particular type of construction had not been used in Monticello to-date. The City code had no language to prohibit the structure and Council found no issue with the type of construction. JME owns three parcels at 1401 Fallon. The new building, currently used for the storage and disassembly of pallets, is sited east to west, parallel to Dundas Road, on the westernmost of the three parcels. Upon review of the potential fees for the permit, the owner of JME, Mr. Jay Morrell, sent a letter to the Mayor and City Council members expressing concern about the number and amount of the fees. Subsequently, staff arranged a meeting between Mr. Morrell, staff and two member of the City Council. During that meeting, each of the permit costs mentioned in Mr. Morrell's letter were reviewed. Grading and Building PermitAnalysis In summary, the following were the outcomes for the items related specifically to grading and building. If the fee listed was considered to be valid by both City staff and JME, it is listed as "Applicable". • Grading Permit: APPLICABLE The City is releasing the $6,000 security held for grading and restoration associated with the building permit. The City Engineer has determined that restoration is sufficient to release the funds. Building Permit Fee: APPLICABLE This fee is charged based on the estimated cost of inspection time for the building. Inspections included footings & foundation, framing, final. The application of the fee is consistent with charges set forth in the City fee schedule. It is noted that Council has asked staff to review both the Building Permit Fee and Plan Review Fee in terms of cost for service. • Building Plan Review Fee: APPLICABLE Fee is charged based on the amount of time needed to review the application, Council Agenda: June 8, 2009 including site and building plan documents. The application of the fee is consistent with the charges set forth in the City fee schedule. • State Surcharge, Building Valuation: APPLICABLE Standard fee charged by the State of Minnesota and paid to the State of Minnesota. • Excavation Fee: NOT APPLICABLE The $30.00 charge is a standard fee paid for excavation in City right-of--ways to cover inspection for restoration of right-of--way. • Utility Locate Fee : NOT APPLICABLE When a contractor contacts Gopher State One Call, that service contacts the local utility authority to locates its utilities in the area. This fee covers the location of City utilities by City staff. At the conclusion of the meeting, the majority of the outstanding concerns had been addressed as related to specific building and grading fees/deposits. Trunk Fee Analysis AT the time of the meeting with JME, it was determined that additional research needed to be completed on the application of trunk area utility charges. This was due in part to two factors: 1. The availability of on-site ponding and its capacity. 2. The site's transfer of ownership. Mr. Morrell asked staff to research past files for information on whether this parcel was to be excluded from trunk fees due any of the above factors. Staff has reviewed all planning and project files, as well as plat and grading/drainage documents for the property and found no documentation relating directly to the exclusion of the property from applicable trunk charges. Staff also reviewed the City Council minutes related to policies for application of trunk storm charges for previously developed properties. (These minutes are included for Council's reference.) In 1997, the City Council adopted a policy that allowed trunk storm charges to be applied for newly developed property in the industrial park. Under that policy, if a site was 85% developed, no charges would be applied, even if a new building or addition was being developed on site. However, if the site was under that threshold, the trunk storm fees would apply. The City has consistently applied this formula for all trunk utility fees since the adoption of those amendments in 1997. Council Agenda: June 8, 2009 As noted, the new building sits on the west parcel, which was undeveloped at the time of the amendment adoption in 1997. Council should also note that the lot line between the two parcels has shifted, which may impact the proportion of applicable area charges. Staff completed an on-site inspection of the storm water ponding facility, as well as the overall site. It is the City Engineer's conclusion that the current on-site ponding and internal storm sewer system is adequate to control stormwater runoff from this facility. Staff has therefore determined and would recommend that the alternative ponding area trunk storm charges would not apply to the newly developed property. Staff met with a representative of JME last week to discuss these items. JME contends that when Mr. Morrell purchased the property, it was his understanding that all utility improvements were complete and no future charges for water, sewer or storm would apply. It should be noted that the City's trunk program was adopted in 1990, after JME's purchase of the property in the mid 1970's. JME is requesting waiver of all trunk charges. It is staff's understanding at this time that JME has no issue with the other permit charges as listed. STAFF IMPACT No staff impact. BUDGET IMPACT Trunk area charges are applied to developing properties as a means to fund area-wide water supply, sanitary sewer and storm sewer system improvements. For example, an oversizing of a sanitary sewer system along Dundas Road was recently completed. This line ties into a system that runs through Union Crossings and underneath Interstate 94. This area-wide sanitary system serves to take some of the sanitary sewer need produced by JME. It is important to the funds supporting each system that each development contributes its proportional share of the area improvement costs. The trunk program was developed to spread the costs of these improvements as equitably as possible. B. ALTERNATIVE ACTIONS 1. Motion to recommend that building and development charges for the February 2009 building permit for JME of Monticello be applied, including charges for base trunk storm sewer, water supply, and trunk sanitary sewer. 2. Motion to waive all trunk charges for the February 2009 building permit for JME of Monticello, based on a finding to be made by the City Council. 3. Motion of other. Council Agenda: June 8, 2009 C. STAFF RECOMMENDATION The consulting City Engineer will be hand on Monday evening to review in-depth the trunk fee program. Council will want to consider the many variables and complexities of this development in weighing the proper application of trunk utility charges with WSB's input. Application of base trunk storm, trunk water and sanitary storm sewer charges appear to be consistent with the past circumstances in which current industrial properties developed new portions of their sites. However, City Council may find that due to the long-term use of the western parcel for storage of materials and equipment and the relatively impervious nature of the majority of the site, the site may be considered fully developed. D. SUPPORTING DATA 2009 Aerial Image 2009 Building Permit Letter from JME dated February 6, 2009 2009 Fee Schedule -Trunk Charges 1997 Staff Report -Amendment to Storm Sewer Trunk Fees 1997 Aerial image illustrating development JA!i%06/2009%TUE 114:26 PM CITY OF h~ONTICELLO FAI No, 763254404 F, 0011001 CITY OF MOI~TTYCEx,~,U . pER1VIIT NO.: 2008-03634 58S 'W'ALNUT ,STkt~ET 11'1C7NTICPLLU, MIS 5536x- DATE ISSU>~D: r~r~~~ ~oz_an~n YrA~Y. l7~~1'f.04~sitld PRIDITEI7 'WI'i'1•IQ'UT 198UIN0116lZ009 A)<lblt)a;SS 212 DC.1NbAS Rb PIN 15501$003060 )<.,1; D)ECSC OAK'WOOLt YNb•PARK ~` LOT 006 $LOCK 003 PERMTT T'4PE BUILDINC3 PROPERTY TYPE ~C]BTRIp>:, CONSTRYYCTION TXI'E NBW CONST1tIJCTIr3 ~---- VAJwUATION $ 200,000.00 NOTE; BASE17 ON _82 t~GItES (35,432 SQ ~ /INDUS ! Np ON 9ITB PONbiNQ rIL1Ml3$R OF AC1tE5 0~~+ r~` •~ P" APPLICANT BLJIY.DIl~TCI PBI7MIT 1,b47.3 $ • "°- PLAN REVIBW FBB l A70.80 ICMBI LLC STA'P13 SI]RCHA.RCi•E, BLDG VAL 100.00 --~ 1401 FALCON AVE EXCAVATION FEE 30.00 - `' MON'I'ICBY,LO.1~ 55362 A93B83MBNT SIrARCH F~ 23.00 - ~ UTILITY LOCAT!/ ~B. N'oN-RESI 50.00 ...- '),RI~•I~IC STORM WATBR FIyE 9,365.22 TRUNK'W'ATi3It CHARGE, NON'-1tE9I 1,$5$.94 OWN.>GR TRUNK SANITAk'Y 9R. FEE, NON-1tR41 •2,513.30 YCMB[ LLG TOTAL - 16,660.64 1ao11zAL1,oN AvB MOM'[CELLO, MN 55362» . pCktLBME1tiCT ANb SWORN $TA1'EIVS{1i:NT I agroe thatthe work will be condua6ed 1A confarmence with the ordfnanaea of the City of Mondcella end with the ~ Minnesota State 13Uilding Cade. I understand that the work will be iit aooardance with tha plan that ~hes bean approved by I a¢ree that any damage causod to the bullding Official , pnbllo praperty including butnat lfmlted to curiz sidewall~ publto utllitiCS qnd signs will ba xepaired at my expense Applicant Date Hldg Offlolal - bate ~ ~ 5EpA1t.A,7'F PERMITS REQI7II~Eb 1zOR WORK OTHBIL TITAN bESCRIBED ABO'VB. JAN-6-2009 TUE 15:26 TEL:7632958?65 NAME:JME ~ MONTI. P• 1 _.: PLANNING CASENO. MONTTCELLO City Hall: (763) 295-2712 Fax: (763) 295-44D4 E-Mails Commdevr ci.mont{collo.mn.us 1. Permit not valid without gradmg/erosio control plans approved by the CityEngineer. A copy of approved grading plans must accompal~y this application. Application must be signed by City Engineer. 2. Escrow or deposit must be received prior to commencement of grading. 3. Trunkclf~ s a~ p ~ 4. FEE: $150 3000 Per Ac>~ row/LO / ,--, „ , „ ;, ~, ~ LOCATION OF GRADING: 2 ~' ~ (~ ~ ~''' ~ ~ ~ PURPOSE OF GRADING: '~l~tc.T 1 ~ti o ~ /rk w p 4) t-Q I N~) CUBIC YARDS OF MATERIAL TO BE GRADED: ~ £ Q ~., :2 t r~ 4vT a ~ '1Faa T ~ at~ ?2 K /~(~ Sr~~cr~~t ACRES TO BE GRADED: Z- ' x $3000/acre ~. $ ~i ~~a eposi r LOC EROSION CONTROL MEASURES: ~r~ , GRu+rN~ ptr~~ o,~ Applieant Signature ~.~1'~'GYT/uN ~~No one /~o,.~.-o A,F- Date (FOR CITY USE ONLY) The undersigned hereby applies for a pemut to grade for the purpose of ~~-wcrtn_1'~C b~ r ~~'~~ in the City of Monticello for the term of ~o from the date hereof . ~~ (day wont Restoration must be completed in - (days/ ont s~ City Engineer ~ ~-- __.. Date Approved I ~Cq ~0~3 ~IME COMPANIES www.JMEcompanies.net February 6, 2009 MAYOR & CITY COUNCIL MEMBERS, I am writing to express displeasure and frustration with the city building permit process. I have enclosed 2 attachments with this e-mail: 1. Grading permit application for which I paid $6000.00 2. City of Monticello invoice for $16,660.64 I will address the "problem" with each of these individually. GRADING PERMIT When we first approached the building department for a permit they gave us an erroneous amount of $000000 for the permit. We explained that we have an invoice for the complete construction {labor plus materials) for $126,000. We did add in the concrete wall and floor for a total of $200,000 for the value of the building. In a conversation with Mayor Herbst we were told building inspector Gary Anderson was out of town, this was an unusual building that Monticello had not seen before, and that the building permit process would be worked out in a fair manner. As you can see the building size is 72 X 176. The only dirt work that took place was to add compacted recycled concrete to an area 6 feet in excess of the building, creating a foot print of 84 X 188. In addition we removed part of a berm 15 X 300. The result of this "Grading" operation is a total of 20292 sq feet. This is less than 1/2 acre. Please note the Grading permit charge of 2 acres X $3000 per acre = $6000. Please explain and justify these charges. The building construction is now complete with the exception of the concrete floor, which will be poured when weather permits. I will address each item on the City of Monticello invoice individually. BUILDING PERMIT FEE $1,647.38 If this is the correct fee for a building valued at $200,000 then I accept. Ready Mix Concrete • Concrete Block • London Stone LondonPavers • LondonBoulder • Roil-Off Containers • Cement Hauling • Aggregate Hauling • Snow Removal JME of Monticello, Inc. Alexandria Concrete Company Wadena Ready-Mix Monticello Block 901 4th Avenue E 415 5th Street SE 1401 Fallon Avenue Alexandria, MN 56306 Wadena, MN 56482 Monticello, MN 55362 Phone: (320) 763-4600 Phone: (218) 631-1558 Phone: (763) 295-3122 Fax: (320) 763-4676 Fax: (218) 631-1080 Fax: (763) 295-8765 Concrete Products of New London, Inc. 17550 Hwy 23 NE New London, MN 56273 Phone: (320)354-2311 Fax: (320) 354-2477 Concrete of Morris, Inc. 1200 Pacific Avenue Morris, MN 56267 Phone: (320) 589-3700 Fax: (320)589-4339 Hutchlnson Concrete, LLC 21563 Hwy 7 W Hutchinson, MN 55350 Phone: (320)587-3334 Fax:(32D) 587-6274 PLAN REVIEW FEE $1,070.80 This is totally confusing. We presented to the city a totally engineered building plan signed by a Registered Engineer. The building has no Mechanical or Plumbing installation. 4 walls, a dome roof and a concrete floor. What is the City's hourly rate to review a building system designed by a Registered Engineer? STATE SURCHARGE,BLDG VAL $100.00 If this is the standard no problem EXCAVATION FEE ASSESSMENT SEARCH FEE $30.00 For what???? $25.00 For what????? UTILITY LOCATE FEE,NON-RES $50.00 We called Gopher State One to locate before any excavation took place. What is this for????? I do not recall anyone from the city trying to locate anything. TRUNK STORM WATER FEE $9,365.22 The plot for this piece of property was accepted by the City of Monticello in the 70's and the building plans were accepted in the early 80's. These plans provide for all storm water to be contained on site in a holding pond on the south end of the property. This includes a catch basin and piping to the pond within the property. This was stated on the "Grading Permit Application", thus what is this charge for????? TRUNK WATER CHARGE NON-RESIDENTIAL $1,858.94 As I previously stated this building is not heated and is for cold storage. NO WATER WILL EVER BE EXTENDED TO this building in its present state. Why should I pay for water???? All services are provided by our adjoining property which has paid its fees. TRUNK SANITARY SEWER FEE,NON-RESIDENTIAL $2,513.30 See above statement: No water and no sewer hook up?? All total the fees listed above are $16,660.64 which amounts to 8.3$ of the building value. Does this make sense??? I am not sure if the $6,000 I paid for the grading permit is on top of this or not. If it is, the percentage ratio is 11.3&. We have tried to explain our situation to the City Building Department, but we are told that no one in the Department has the power to make a decision regarding the situation. I would be happy to show any or all of you our building and enter into a discussion on how to fairly resolve the situation. Respec lly, ~ ~G~~'~ Ja ~orrell 0 er ~J_ Cfouncil Agenda -~ /~ 10/97 ' 9• (~on4ideration of adOp in r~amerAmnntc to ctllr.rr. ~., r a s~ fPP ~. (J.O.) City Council is asked to consider adopting amendments to the storm sewer access fee policy that were reviewed and tabled at the August 26, 1996, meeting of the City Council. In tabling the matter, Council requested that City staff survey other communities regarding storm water policies. City staff has completed its research, and we also have had the opportunity to meet on three occasions with members of the commercial community regarding the storm water fee program. The meetings have been very productive by providing City staff with important perspectives regarding the impact of the program on commercial development. I believe that the property owners have a better understanding of the benefits that are obtained for the entire community through development of a comprehensive storm sewer development and financing policy. Although the program presented today has imperfections, it was the consensus of the interest group to support the storm sewer access fee policy as presented to the City Council on August 6, 1996. It was the perception of the group that the system is designed to a standard that exceeds the need, thus driving up cost. A separate memo regarding this issue is provided for your review. The memo attempts to clarify the actual design standards used and maX sufficiently address the concerns of the interest group involved in reviewing the policy. Upon reviewing the memo, Council may or may not wish to review design standards further. A special thanks should go to Brad Barger for hosting the meetings and to those that attended, which include the following: Rick Wolfsteller; Bill Fair; Jon Bogart, registered engineer; John Bondhus, Bondhus Corporation; Bill Tapper, Tappers Inc.; Kevin Doty, Marquette Bank; Steve Schoen, Aroplax; Bill Demeules, Standard Iron; Steve Johnson, Monticello Ford; Kent Kjellberg; Brian Dobie; Brad Barger, Suburban Machine & Manufacturing; John Michaelis, Gould Brothers Chevrolet; and Nancy Spivak, Bondhus Corporation. The following section outlines concerns,with the current program as adopted on August a26, 1996. As you may know, City staff has suspended full implementation of the current program pending consideration of the amendments being reviewed today. The concerns noted below were expressed at a series of meetings prior to August 26, 1996. The amendments to the program were geared to address these concerns. 13 Council Agenda - 3/10/9? Concerns by Interest Group that the Amendments are Designed to Address The concerns expressed by industrial property owners at meetings prior to August 26, 1996, regarding the existing plan focused in the following areas: A. It was felt by some that the design standards may be excessive, thus driving up the cost for storm sewer service per acre. B. The trunk fee program results in an unexpected fee for existing industrial developments. They felt they owned completely developed, "assessment-free" property. Applying this unexpected fee retroactively to the entire industrial site is an impediment to existing expansion plans. It is also not consistent with treatment of existing residential development. For example, in the case of Tappers, Inc., the trunk storm sewer fee is applied to the existing acreage encompassed by the existing building and parking area (3 acres). The trunk fee requires that a fee be paid for the 3 acres that are already developed the fee must also cover the expansion area of 3 more acres. C. The trunk storm sewer fee should be based on only that portion of a parcel that is actually being developed and not based on the size of the entire parcel on which a development occurs. For example, under the current plan, industrial development is required to pay for trunk storm sewer service based on full development of the parcel even though only half the parcel is actually being developed. There was a concern that the City should not be collecting fees based on undeveloped land areas that are not contributing toward an increase in storm water runoff. D. Requiring full payment of the trunk storm sewer fee at the time of acquisition of a building permit is a problem. The program does not provide for a method of financing this fee or spreading the cost over a period of time. E. Undeveloped areas of the community have not been studied; therefore, they are not included in the program. TRUNK STORM SEWER POLICY In response to the concerns above, the following policy outline was prepared, which identifies goals and identifies program modifications. 14 Council Agenda - 3/10/97 Goals and Purpose A. The trunk storm sewer program should include engineering design standards that will assure cost-effective construction and maintenance, thereby assuring the greatest value per dollar spent. B. The trunk storm sewer improvement program should prevent serious storm water problems caused by urbanization while limiting premature capital improvement expense. The program should strive to achieve timely acquisition of land and timely construction of facilities at a pace even with the rate of land development. C. The funding program should rely only on general taxes when. assessment and storm sewer revenue is unavailable to pay for storm sewer construction at the time of construction. D. The funding program should include assessments against properties benefiting from storm sewer development. E. New development should pay its share of the cost associated with managing storm water created by new development. Therefore, the program applies only to watershed areas that will need new trunk facilities resulting from development. (This is especially important given the potential reduction in tax base due to pending legislation. F. The funding program should be designed and administered in a manner that supports business expansion and development. G. The trunk fee program is not intended to apply to "built out" areas that will not be served by new trunk service resulting from new development. Proposed Program Modifications or Clarifications City staff proposes maintaining certain aspects and changing others. Following is our recommendation. A. DESIGN STANDARDS The design proposed is based on centralization of pond systems which will result in long-term maintenance cost savings and will assure productive and efficient use of land. Continued discussions maybe needed to resolve design issues. The perception in the community is that the system is "overbuilt." ~s Council Agenda - 3/10/97 B. TRUNK FEE CALCULATION AMENDMENT Adopt a "Pav a~.vou gQ' approach, Currently, the program requires that the trunk storm sewer fee be based on the entire ar a of the Dar~pl being PvPi l~ even if the parcel is large and the portion of the parcel developed is small. This should be changed by basing the fee on the actual area developed and not on the potential area. For example, if only half a 5-acre parcel is developed, then the trunk fee associated with that particular parcel would be limited to 2.5 acres X the trunk fee. The portion of a parcel determined as being developed would be measured based on the footprint of the building, parking, and setbacks for the zoning district in which the building is located. At such time that 85% of a parcel is developed, including setbacks, the parcel would be deemed fully developed, and the fee would then be based on development of the full parcel. C. ASSESSMENT PROGRAM Under the current program, the fee is charged against the entire site at the time of expansion. It is proposed that the trunk storm sewer fee would ~ be charged against the portion of the site that is already developed. Instead, existing development would be subject to the standard assessment process. Future trunk storm sewer projects would then be assessed against parcels based on what was developed as of the date of the inception of the trunk storm sewer program. In calculating the assessment rate, the entire acreage of the area benefited by the trunk storm sewer improvement would be used in calculating the rate. Individual parcel assessments would be based on the area within that parcel developed as of August 1996. This area would be measured based on the footprint of the building area, parking lot, outside storage, and setbacks. For each storm sewer project, an assessment roll would be prepared. The amount paid by each parcel would be dependent on the level of development of the parcel as of August 1996. For example, a 10-acre parcel that is 1/z developed and 1/z vacant will pay as follows: The portion developed will only pay assessments based on projects completed over time. The other 5-acre portion of the site will pay a trunk fee at time of development and will never pay an assessment. Thus, the total cost of trunk storm sewer improvements will be paid via assessment for all existing developed areas and trunk fees for expansion and newly- developing areas. This program is actually very similar to what we ultimately adopted for financing the Meadow Oak storm sewer improvement. 16 Council Agenda - 3i 10/97 D. It is proposed that the City allow the property owner to place the cost of the trunk storm sewer fee against the property as an assessment. Thus, the City will collect this trunk storm sewer fee aver time. This option improves options for project financing. The major implication for the changes in the policy are as follows: 1. Trunk storm sewer design standards relating to pond centralization. This will result in long-term benefits in terms of use of land and storm sewer maintenance. Standards relating to capacity would continue to be reviewed, which could result in a future reduction in fees. 2. The changes will not limit the City's ability to complete storm sewer projects on a timely basis. 3. The proposed changes will result in a shifting of the cost to upfront city improvements to general taxes and away from industrial development because the City will be collecting funds based on only the area encompassed by development and not the area encompassed by development + future expansion areas. It is the view of City staff that this alternative, though resulting in greater upfront cost for the City, is more fair and, therefore, justifiable. 4. The original funding program did include assessments in addition to the trunk storm sewer fee program; however, under the proposed modification that calls for existing developed industrial land to pay an assessment rather than a trunk fee at the time of expansion, it is possible that the potential for obtaining revenue from such sites would be slightly diminished due to difficulties in establishing benefit equal to assessment cost. 5. The proposed changes to the program are consistent with the goal of requiring that development pay for its share of trunk storm sewer expenses. Linking the fee per acre to the actual developed area and providing an alternative method for financing the fee are changes that will help support business expansion and development. 6. Finally, the trunk storm sewer fee relies on user fees and assessments to pay for capital expense associated with development of the trunk storm sewer system. If Council believes that the cost per acre for trunk storm sewer will impact the City's ability to compete with other communities, the Council could lower the trunk storm sewer fee by committing general funds to pay for a percentage of the trunk storm sewer expenses. Currently, under this program, the City's expenses are limited to the holding cost associated with completing projects prior to collection of sufficient trunk storm sewer and assessment ~~ Council Agenda - 3/10/97 funds. Council may wish to consider contributing even more to the program by paying for a portion of the cost to complete these projects right off the top. It is not recommended by staff that the City fund a portion of the trunk storm sewer cost because it is our view- that the t lnk storm sewer cost should be reflected in th pri P~nf the lend, which is ultimately dictated by the marketplace. We are concerned that subsidizing expense of the trunk storm sewer fee would not result in a reduction in the cost of land, thus would have no effect on making Monticello desirable for industry. It might be better to leave the fee at a higher level, then provide incentives to defray the expense on a case- by-case basis. 1. Motion to adopt the proposed modifications to the trunk storm sewer program retroactive to the date when the fees were established and review costs of unstudied areas so that such areas can be incorporated into the program. Motion to include authorization to analyze the potential of reducing design standards. Under this alternative, the City Council believes that the proposed modifications are reasonable and that they represent a positive refinement of the trunk storm sewer policy and that City staff shauld proceed to make adjustments to agreements and to fees that have already been paid relating to the trunk storm sewer fee and make them consistent with this action. If it is found that design standards should change, resulting in a reduced fee, then parties that have paid the fee would be provided a rebate. 2. Motion to approve the proposed modifications with further modifications as established by the City Council. Based on Council discussion, there maybe other aspects of the policy that need clarification or modifications. Perhaps the City Council desires to pay for a portion of trunk storm sewer expenses out-of- pocket, etc. 3. Motion to abandon the trunk storm sewer policy and direct City staff to develop an alternative method for funding trunk storm sewer projects. Under this alternative, the assessment program becomes the primary method for obtaining revenues for trunk storm sewer improvements. As noted in previous discussions, relying entirely on assessments to ~a Council Agenda - 3/10/97 collect trunk storm sewer funds is quite difficult and will likely result in the City paying a major portion of the principal expense associated with trunk storm sewer improvements. Council may wish to direct staff to investigate establishment of special taxing districts for each watershed. Under this alternative, each parcel pays taxes based on the cost to build storm sewer facilities in the watershed in which a parcel is located. This alternative was not selected previously because such a high percentage of the areas being served are occupied by school district or church property, which would not be contributing taxes toward their respective watershed districts. As in August of 1996, it continues to be the recommendation of the Assistant Administrator, Public Works Director, and City Engineer to adopt the proposed modifications to the trunk storm sewer policy as outlined. We believe that concerns put forth by affected property owners had validity, and we believe that the proposed modifications are justifiable and represent a good compromise. We also believe that the basic reasons for the trunk storm sewer policy justify the continuation of the policy. Many cities in the metro area use similar policies to collect trunk storm sewer fees, and many have higher costs per acre. Again, there has been a huge level of discussion and input on this matter. Thanks to all those that have contributed. On behalf of City staff, we look forward to a decision on this matter so that we can move on to complete other important projects. Storm water trunk fee justification report; Storm sewer trunk fee application examples; Storm water program survey; Storm water fee development chronology. 19 SCENARIO 1 - VACANT 10 ACRE PARCEL EXAMPLE: ANY VACANT PARCEL SCENARIO 2 - 10 ACRE PARCEL CONTAINING 6 ACRES DEVELOPED I I , , I I I j I I I j j VACANT j i j I ' , I I j i j I j ~ I i ------------___I A -PAYS NO ASSESSMENT AT ANY-TIME B -PAYS TRUNK FEE ONLY AT TIME OF DEVELOPMENT BASED ON THE PORTION DEVELOPED COMMERCIAL /BUSINESS: 10 AC x 65200/AC = $52.000.00 INDUSTRIAL: 10 AC x 64933/AC = 49.930.00 I----------------I i I I j j FUTURE j , , I i -I I I j EXISTING ' I I ~ I I I ' PARKlNO LOT i -------~ A - 4 ACRE PORTION PAYS TRUNK FEE AT TIME OF DEVELOPMENT COMMERCIAL /BUSINESS: 10 AC x 65200/AC INDUSTRIAL: 10 AC x 64933/AC RESIDENTIAL ~ 4 UNITS / AC 10 AC x 64502.50/ AC RESIDENTIAL ~ 4 UNITS / AC 8 - 6 ACRE PORTION PAYS ASSESSMENT AT TIME OF 10 AC x 64502.50/ AC = 45.025.00 STORM SEWER TRUNK PROJECT WSB Project No. 1010.06 bete: Atpust 22,1996 • ~Wea~oodL~a Storm Sewer Trunk 8441 Wayzata Boulevard Mtnnaapo8s, MN 65428 B Fee Payment Senarios B,Z.t;4,~ ~"'~'"',"`. 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