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City Council Minutes 12-13-1982MINUTES REGULAR MEETING - MONTICELLO CITY COUNCIL December 13, 1982 - 7:30 P.M. Members Present: Arve A. Grimsmo, Fran Fair, Ken Maus, Phil White. Members Absent: Dan Blonigen. 2. Approval of Minutes. A motion was made by Maus, seconded by White and unanimous- ly carried to approve the minutes of the regular meeting held on November 22 and the minutes of the special meeting held on November 30, 1982 as presented. 4. Public Hearing - Central Monticello Redevelopment Plan and Adoption of Resolution. A public hearing was held to receive citizen input on the Central Monticello Redevelopment Plan which becomes the tool that is required to implement future tax increment financing within the City of Monticello. Basically, the redevelopment plan is a general guide plan stipulating boundaries within which the HRA may work to create new development and redevelopment of existing deteriorated properties. The Monticello HRA Committee developed the plan with goals and objectives stated along with determining the boundaries wherein they will work. The plan also makes certain find- ings such as determining which areas are substandard in nature. The HRA recently adopted the Central Monticello Redevelop- ment Plan and the Monticello Planning Commission also re- viewed and adopted the same plan. The Planning Commission's review of the plan centered on whether it was in general conformity with the overall comprehensive guide plan of the City. Hearing no citizen's comments and concluding that no re- visions were necessary, a motion was made by Fair, second- ed by Maus and unanimously carried to adopt a resolution establishing the Central Monticello Redevelopment Plan as submitted. (See Resolution 1982 #62). - 1 - Council Minutes - 12/13/82 5. Public Hearing - Oakwood District #1 Tax Increment Finance Plan and Adoption of Resolution. In regard to the previous adoption of the Central Monti- cello Redevelopment Plan, a proposal has been submitted by IXI Laboratories requesting tax increment financing assistance to develop a parcel of land in the Oakwood Industrial Park. A development agreement has been entered into between the City of Monticello HRA and IXI Laboratories, whereby the HRA has agreed to sell a portion of Lot 7, Block 3, Oak- wood Industrial Park to IXI at a reduced cost for the purpose of establishing a new industrial business in Monticello. The financing plan in general, establishes how the City's write down in cost will be recovered over the next eight (8) years through tax increments that the new building will generate on the parcel of land. A copy of the tax increment financing plan has been submitted according to State Statutes to the other taxing juris- dictions within Monticello including the hospital board, school board, and county board for their comments. A motion was made by Maus, seconded by White and unani- mously carried to adopt a resolution adopting Oakwood District #1 Tax Increment Financing Plan as submitted. (See Resolution 1982 #63). 6. Public Hearing on the Meadow Oak Subdivision Improvements. This public hearing is a continued hearing on the proposed public improvement to serve the proposed Meadow Oak resi- dential subdivision plat. This item has been delayed several meetings to enable Mr. Jim Boyle primary owner of the Meadow Oak Subdivision to work out details in estab- lishing fee title in his name. The developers of the Meadow Oak Subdivision requested that the Council authorize the preparation of final plans and specifications for providing utilities to the prop- erty but not yet order the improvements to be made. The reason for this request was that the developers are plan- ning to sell limited partnerships in the subdivision but the sale of the partnerships cannot take place until in- dications are made by the City that progress is being made towards providing utilities to the property. Once the limited partnerships have been sold, the resulting funds will be used to release Mr. Hoglund from the properties so that Mr. Jim Boyle and his associates will become fee owners in the property. In addition, the developers have - 2 - Council Minutes - 12/13/82 agreed to guarantee payment of any cost associated with the preparation final plans and specifications for the utility extension should the project not proceed. A motion was made by Maus, seconded by Fair and unani mously carried to authorize the city engineering firm of OSM to prepare final plans and specifications for the utilities extension to the Meadow Oak Subdivision, provided a signed agreement has been reviewed and ap- proved by the City Attorney that would indicate that the developers are responsible for all costs associated with the plans if the project should not proceed as planned. In authorizing the preparation of final plans and specs, it was noted that the project was not yet ordered to be made, but that the public hearing regarding the actual ordering of the improvement will be continued until the January 10th, 1983 Council Meeting at which time the developer should have full title to the property. (See Resolution 1982 #64). 7. Public Hearing - On Adoption of Resolution on Proposed Assessment Rolls for 82-1 Improvement Project. 8. Consideration of Change Order #1 with Omann Construction on the 82-1 Improvement Project. The 1982-1 Improvement Project consisted of street im- provements along 7th St. between Hwy 25 and Cedar St. The total project cost was estimated at $56,190.96, of which 100% was proposed to be assessed to the benefited property owners. As part of the project cost with Omann Construction Comp- any, a change order in the amount of $3,572.50 has been submitted by the consulting engineer for approval. Of the $3,572.50, the contractor was requesting $1,050.00 for the removal and relocation of one existing catch basin. John Simola, Public Works Director, in review- ing this item noted that the City was not aware that this item would be added to the construction cost and noted that during the preconstruction meeting with the contrac- tor, a number of ways were discussed with the contractor on how the existing catch basin could be either be re- located or attached to the system. At that time, no additional compensation was requested by the contractor, and as a matter of fact the contract and plans indicate that the existing catch basin would have to be connected at no additional compensation. As a result, the public - 3 - Council Minutes - 12/13/82 works director felt that this entire $1,050 item should be deleted from the change order. Also, it was noted that the retaining wall built along 7th Street cost approxi- mately 25% more than the original estimate, but it was de- termined that extra work was done by the contractor jus- tifying the additional amount. If all construction costs including the entire change order 41 along with engineering fees and other related expenses were calculated, the total project cost would be $56,190.96, proposed to be assessed as follows: Perkins Restaurant $17,949.01 Americ Inn Motel 13,102.82 Cemetery Property (City) 25,139.13 TOTAL $ 56,190.96 In regard to the change order request #1 by Omann Con- struction Company, a motion was made by Fair, seconded by Maus and unanimously carried to approve change order #1 on the 82-1 project at a maximum dollar amount of $3,572.50 but authorizing the consulting city engineer and,public works director to negotiate directly with Omann Construction Company on the $1,050 item in ques- tion. As a result, the change order amount could be re- duced by up to $1,050 after negotiations. In order to establish the assessment rolls prior to the, end of 1982, a motion was made by Fair, seconded by White and unanimously carried to adopt the resolution estab- lishing the assessment rolls for the 82-1 project as noted above but a notation was made that if negotiations between the engineer and the contractor resulted in a reduction of change order #1, this amount would also be deducted from each property owner's assessment. The assessment roll as adopted would be over a 10 year period of time with equal principal payments at 920 interest rate. (See Resolution 1982 #61). 9. Consideration of a Proposal to Construct Elderly Housing and Utilize Tax Increment Financing for the Acquisition of Property Recently Purchased from the Monticello Develop- ment Corporation. Mr. Joe Poehler presented to the Council a proposal for the development of approximately 20 to 25 units of moderate elderly housing in the City of Monticello. The proposal would be for the property recently optioned by the City from the Monticello DEvelopment Corporation located on - 4 - Council Minutes - 12/13/82 3 lots in Block 51. Mr. Poehler indicated that he is currently in the process of preparing plans for an apart- ment building and is also currently applying to the Farmers Home Administration for approval of this project. Mr. Poehler noted that as part of the Farmers Home appli- cation process, he would have to provide evidence that he has an option on land that would be suitable for build- ing his proposed apartment. As a result, Mr. Poehler re- quested the right to obtain an option from the City on this site so that his application can continue in the pro- cess. It was recommended by the City Staff that Mr. Poehler meet with the HRA Committee to present his proposal to them to see if it would meet with the HRA objectives for the property in question and if so, the HRA could possibly buy out the City's option on the Monticello Development Corporation's property and then the HRA could option with Mr. Poehler if the proposal seems feasible. In regard to the existing buildings located on the optioned property, it was recommended by the Council that the City Staff pursue options available to remove the buildings from the site. One possibility would be to get quotes from a contractor on removal and demolition of the buildings, while another possibility would be to have the fire depart- ment burn the buildings during a fire drill. This item will be discussed by the Council at a future date. 10. Consideration of a Preliminary Plat of the Meadow Oak Sub- division. Mr. Jim Boyle, along with his associates, Dick Knutson and Bob Bemboom, developers of the proposed Meadow Oak Sub- division presented to the Council their preliminary plat proposed on approximately 177 acres of land. The pre- liminary plat indicates that there will be 76 executive home sites, 244 single family detached manufactured hous- ing sites and 204 to 216 manufactured housing attached sites. In addition, the developers are proposing to schedule the development of the plat in phases with the first phase consisting of 31 executive home sites and 39 manufactured detached home sites. The first phase of the development will coincide with the installation of sewer and water utilities as previously requested. The pre- liminary plat has been reviewed by the consulting engineer and consulting city planner who have made their comments available to the developers in regard to meeting all of the city ordinances, etc. - 5 - Council Minutes - 12/13/82 Mr. Dick Knutson noted that all park trails, landscaping, etc. will be done in phases along with the actual development of the lots. In addition, they plan to build 5 model homes with three of the homes being dynamic homes and 2 manufactured type homes from Homera, Inc. The Planning Commission at their earlier meeting recommend- ed approval of the preliminary plat as presented contingent upon the developers incorporating into their plat all of the comments recommended by the City Planner and City Engineer. In addition, the Planning Commission noted that only manu- factured sectional housing would be allowed in the manu- factured home sites and that the executive home sites would contain only custom built or manufactured housing that meets the State Uniform Building Code. A motion was made by Maus, seconded by Fair and unanimously carried to approve the preliminary plat for the Meadow Oak Subdivision as presented contingent upon the developers adhering to the comments submitted by the City Engineer and City Planner in regard to changes that would have to be made on the final platting. In addition, it was noted that the manufactured home sites could contain both manufactured housing and sectional housing but that the executive home sites would only contain housing that met the uniform build- ing code of the State of Minnesota. 11. Consideration of Change Orders #72 through #80 with the Paul A. Laurence Company on the Wastewater Treatment Plant Construction Contract. The following change orders were recommended by the City Engineer and Public Works Department on the Wastewater Treatment Plant Construction Contract. Change Order #72 - The installation of an additional line between the sludge supernatant draw -off pipe line and the return flow drain line of the digesters. Cost is $2,174. Change Order #73 - The addition of supplies and materials needed to start up the laboratory program, $2,295.00. Change Order #74 - Concrete landing at the treatment plant to meet the regulations, an additional $850. - 6 - pads outside of doors uniform building code Council Minutes - 12/13/82 Change Order #75 - A deduction of $1,000 to correct the total contract figures that were in error between change order #69 and #70, deduct of $1,000. Change Order #76 - The addition of semi-automatic flow controls for the return activated sludge pumps, an ad- ditional $2,553. Change Order #77 - The addition of 15 sample ports at vari- ous locations on the sludge and supernatant lines, ad- ditional $2,628. Change Order #78 - The relocation of the discharged duct in the preliminary operating room to provide head room clearance for the odor control discharge duct, an ad- ditional $215. Change Order #79 - The addition of water lubrication in lieu of self lubrication for the raw sewage pumps and the equalization transfer pumps. An additional $2,162.00. Change Order #80 - An extension of the contract from December 31, 1982 to June 1, 1982 to allow the contractor to complete all landscaping work, etc. No dollar amount change. A motion was made by White, seconded by Maus and unani mously carried to approve change orders #72 through #80 with the Paul A. Laurence Company on the Wastewater Treatment Plant Construction Project for a total ad- ditional amount of $12,977.00. 12. Reconsideration of a Request for John Sandberg to Reimburse for Sewer Back Up. At a previous Council meeting, Mr. John Sandberg had re- quested that he be reimbursed for $860 worth of repair work done on his sewer line at his residence on River St. At that time, Mr. Sandberg felt that the City should be responsible for the sewer problems he was incurring. The Council at that time offered to reimburse Mr. Sandberg for one half of the $860 but Mr. Sandberg has now indicated that he will not accept partial payment that was offered by the City but continues to insist that he be reimbursed for the full $860.00. - 7 - Council Minutes - 12/13/82 Mr. John Simola, Public Works Director, noted that he has been attempting to gain access to Mr. Sandberg's property for the purpose of obtaining sewer line elevations, etc. in an effort to gather more information regarding Mr. Sandberg's claim. To date, he has not been able to obtain access and as a result, it was the concensus of the Council to table any action regarding Mr. Sandberg's request until more information can be obtained by Mr. Simola. 13. Consideration of Adopting 1983 Sewer Rates. The new sewer user ordinance recently adopted by the City will become effective January 1, 1983. This new ordinance provides formulas for determining the 1983 sewer rates so that users will pay proportionately and fairly for the operation and maintenance of the Wastewater Treatment facility and sewer collection system. Based on the 1983 budget, the City needs to raise to $200,490 in revenue to maintain the sewer collection system and the operation on the Wastewater Treatment Plant. The new sewer user ordinance provides that industry will be monitored and charged based on not only the amount of flow that is contributed to the system but also based on the amount of BOD and suspended solids that are also con- tributed. Residential customers will be billed based on flow only. Public Works Director, John Simola, presented to the Council his calculations used at arriving at the new rate structure for non industrial users which is proposed at a $1.28 per 100 cubic feet. This amounts to a 21.9% increase over the old rate of $1.05 per 100 cubic feet and the new rate schedule would read as follows: NOTE: All declining scales are hereby discontinued. Billing will continue to be quarterly. Residential: Water meter usage for winter quarter January to March shall be used for computation. Billing as follows: First 0 - 500 cubic feet. _ $8.00 minimum billing - per quarter. Over 500 cubic feet = $1.28 per 100 cubic feet or portion thereof per quarter. Mm Council Minutes - 12/13/82 Commercial, Institutional, Governmental: Actual water meter usage or measured flow for each quarter shall be used for computation. Billing as follows: First 0 - 500 cubic feet. = $8.00 minimum billing - per quarter. Over 500 cubic feet = $1.28 per 100 cubic feet or portion thereof - per quarter. Industrial: Actual water meter usage or measured flow and measured total BOD* and total Suspended Solids* per each quarter. Billing as follows: Flow: 0 - 500 cubic feet = $8.00 minimum billing per quarter. Over 500 cubic feet - $.68 per 100 cubic feet or portion thereof per quarter. BOD: $.133 per pound per quarter TSS: $.183 per pound per quarter *NOTE: By testing as prescribed in discharge/pre-treatment permit. Based on the new rate schedule, non -industrial users are anticipated to contribute $167,079 in revenue with remain- ing $33,411 being attributable to the only major industrial user, Wrightco Products. A motion was made by Maus, seconded by White and unani- mously carried to adopt the new sewer rate schedule for 1983 as presented for residential, commercial and in- dustrial. (See Exhibit #1) 14. Consideration of Sewer Discharge and Pretreatment Ordinance. As part of the EPA Regulations, the City of Monticello is required to develop and enact an ordinance to control sewer discharges and industrial pretreatment. This regulation requires that the ordinance be drafted in rough form by the `.'90o payment level at the Wastewater Treatment Plant which has already occurred. The ordinance is then required to be enacted into law by the end of the current budget period which was December 31, 1982, but has been extended to June 30, 1983. The ordinance was originally scheduled to take effect Jan- uary 1st, 1983, but an extension has been granted for a E month or two to enable the major industrial user, Wrightco Products, an opportunity to review the proposed ordinance. - 9 - Council Minutes - 12/13/82 A motion was made by Maus, seconded by Fair and unanimously carried to table any action on the proposed sewer discharge and pretreatment ordinance until the January Council meeting to enable Wrightco Products more opportunity to review the proposed ordinance. 15. Consideration of a Request by Property Owners to Have Special Assessments Rcamortizcd. A petition was presented to the Council by a majority of the property owners originally assessed under 78-1, 79-1, 80-1 and 80-2 and 81-1 and 81-2 improvement projects. The petition, in effect, requested that the City Council consider reassess- ing the properties involved in these projects from their original five year and ten year period of assessments to 20 years. As part of the petition, the affected property owners are requesting that the City consider changing its assessment policy which requires that all outstanding assess- ments be paid in full at the time of the issuance of a cer- tificate of occupancy for new buildings. The primary concern of the petitioners was that economic conditions have changed since the projects were originally assessed and it is now becoming a hardship for the property owners to keep their payments current under their present assessment formula. Comments were also expressed by some of the property owners that the current five and ten year assessments are a hinderance to commercial and industrial development due to the large annual payments and also due to the fact that the assessments cannot be assumed. Indications were made by some of the petitioners that if the assessments were recalculated and spread over 20 years, many of the property owners would be able to bring the de- linquent assessments current. In addition, it was felt that if the assessments were reamortized over a longer period of time, the City is more likely to receive the annual payments since they will be smaller in amounts, whereas under the present formula, many property owners have not been able to pay anything. It was the Council's concensus to take the petition under advisement and noted to the petitioners that the item will be reviewed with our bonding consultants, etc. to determine what ramifications, if any, there would be in extending the assessments over a longer period of time. Many items have to be considered including the city's bond rating, and cash flow requirements to determine whether the assessments can be reamortized over a longer period of time. - 10 - Council Minutes - 12/13/82 16. Consideration of Proposals for a Water Tower Maintenance rnni-rarri- _ The City's current contract for water tower maintenance with Water Tower Paint and Repair Company of Iowa has recently expired. The past contract included cleaning and repairing every year the interior wax coating with a new exterior paint job every five years. The old yearly cost was $927 and the new contract proposal would amount to $2,135 per year for the five year contract. It was noted by the Public Works Director that the wax coatings are becoming out dated as they do not offer the protection or longevity of the new epoxy type coatings. Although the epoxy coatings cost more initially, it would result in alower yearly cost due to the longevity of the new epoxy coatings. A representative of Water Tower Paint and Repair Company was present at the meeting and noted that the City could enter into a five year contract to repair the wax coating anytime upon written notice and could change to an epoxy coating with the contract being rewritten at that time. It was also noted by the Public Works Director that if a contract was entered into for the services of maintenance of the wax coating only on a yearly basis, with the elimi- nation of the exterior painting, the cost could be reduced to $1,355 per year on a five year contract. A motion was made by White, seconded by Maus and unanimously carried to approve entering into a new five year maintenance contract with Water Tower Paint and Repair Company for clean- ing and annual maintenance of the wax coating interior for $1,355 per year with the understanding that the contract can be cancelled at the end of each one year period of time. The new contract would not include a five year exterior paint job. The painting of the exterior of the water tower would be bid at the actual time it was determined painting was necessary. 17. Consideration of 1982 Budget Transfers. A motion was made by White, seconded by Maus and unanimously carried to approve the following transfers: Council Minutes - 12/13/82 Item Amount Transfer From Transfer In Wastewater Treatment Const. Allocated 9/22/80 $112,929.00 Revenue Sharing Sewer Allocated 9/28/81 87,151.00 Revenue Sharing Sewer *Fire Department Tank Truck (City Share of Costs) 12,939.77 Capital Outlay Fire This amount is for chassis only. Balance of transfer will be done in 1983 when truck is delivered. *Pole Barn at maintenance building. 21,974.81 Capital Outlay Street 1982-1 Const. Fund (7th St. Improv) 56,033.89 Capital Outlay 1982 Const. Fund. Loan from City to HRA for purchase of Oakwood Lot 73,501.67 Capital Outlay General TIF 18. Administrator's Report on the Effects of Action Taken During the Special Session of the Minnesota Legislature. City Council Members were informed that the new budget bill pass- ed by the State Legislators resulted in the City of Monticello receiving a cut of 1.15% of the sum of its local government aid payable for the year 1982. 19. Approval of the Bills. A motion was made by Phil White, seconded by Fran Fair and unani- mously carried to approve the bills for the month of December. Meeting Adjourned. , x /,,-, �9 Af'�� Rick Wolfstel r Assistant Administrator - 12 -