City Council Minutes 07-09-2012MINUTES
REGULAR MEETING — MONTICELLO CITY COUNCIL
Monday, July 9, 2012 — 7 p.m.
Mississippi Room, Monticello Community Center
Present: Clint Herbst, Lloyd Hilgart, Tom Perrault, Glen Posusta, Brian Stumpf
Absent: None
1. Call to Order and Pledge of Allegiance
Mayor Herbst called the meeting to order at 7:00 p.m. and declared a quorum present.
The Pledge of Allegiance was recited.
2A. Approval of Minutes — June 20, 2012 Special Joint Meeting
LLOYD HILGART MOVED TO ACCEPT THE JUNE 20, 2012 SPECIAL JOINT
EDA -CITY COUNCIL MEETING MINUTES AS PRESENTED. TOM PERRAULT
SECONDED THE MOTION. MOTION CARRIED 5 -0.
2B. Approval of Minutes — June 25, 2012 Special Meeting
GLEN POSUSTA MOVED TO ACCEPT THE JUNE 25, 2012 SPECIAL MEETING
MINUTES AS PRESENTED. TOM PERRAULT SECONDED THE MOTION.
MOTION CARRIED 5 -0.
2C. Approval of Minutes — June 25, 2012 Regular Meeting
BRIAN STUMPF MOVED TO ACCEPT THE JUNE 25, 2012 REGULAR MEETING
MINUTES AS PRESENTED. LLOYD HILGART SECONDED THE MOTION.
MOTION CARRIED 5 -0.
3. Consideration of adding items to the agenda
• Gigabit Squared introductions - Staff Update (Jeff O'Neill)
• Update on Finance Director position (Jeff O'Neill)
4. Citizen comments and public service announcements
a. Citizen Comments:
1) Barry Kukowski introduced himself. He is a candidate for County
Commissioner District #2.
Public Service Announcements:
1) MCC Canoe /Kayak events (7/26 & 7/29) — Angela Schumann invited the
community to check out the MCC canoe and kayak events coining up on July
26 and 29. July 26 from 6 to 7:30 p.m. will feature canoe and kayak rides at
City Council Minutes —July 9, 2012 Page 1
Long Lake at Bertram Chain of Lakes Park. July 29`i' will have canoe rides on
the Mississipi River from Ellison Park to Otsego starting at either 2 or 2:30
p.m. Contact the Community Center for costs and to register.
2) Proclamation for Heroes Day— Mayor Herbst presented a proclamation for
Heroes Day to be celebrated on July 28 to honor those who served our
country. There will also be a parade held on Nicollet Mall that day.
C. Staff Update
1) Jeff O'Neill introduced representatives of Gigabit Squared: Mark Ansboury,
Jim Farsted and Mark Pultusker. Jeff noted that they will be around
Monticello this week as part of their study of the operations of FiberNet.
5. Consent Agenda
A. Consideration of approving payment of bills for July 9th. Recommendation:
Approve the payment of the bill and purchase card registers for a total of
$388,296.03.
B. Consideration of approving new hires and departures for City departments.
Recommendation: Ratify new hire for the DMV office.
C. Consideration of approving applications for a temporary 2 -day temporary liquor
license and a charitable gambling permit for the Church of St Henry's fall festival
on September 15 -16, 2012. Recommendation: Approve the applications for a
temporary 2 -day liquor license and charitable gambling permit for the Church of
St Henry's Fall Festival on September 15 -16, 2012.
D. Consideration of approving an application for a charitable gambling permit for a
raffle to be conducted by Wright County /West Metro Whitetails on September 9,
2012. Recommendation: Approve the application for a charitable gambling
pen-nit for a raffle to be conducted by the Wright County /West Metro Whitetails
on September 9, 2012 at River City Extreme.
E. Consideration of appointing election judges to serve for the 2012 elections and on
the Absentee Ballot Board. Recommendation: Approve election judges as listed
and approve Richard Quick as Head Election Judge.
Ahrens, Jerrie
Anderson, Cindy
Anderson, Fred
Bienias, Al
Bitzer, Gladys
Bourque, Richard
Brambrink, Sandra
Branch, Donna
Kendall, Harvey
Lenzen, Mary
Ludwig, Charlotte
Moody, Judy
Nesland, MerriJo (Jo)
Norling, Carol
Norling, Lonnie
Opay, Frank
Denise
City Council Minutes —July 9, 2012 Page 2
Carlson, David
Peters, Diane
Christianson, Charles
Quick, Richard
Dahl, Rosemary
Sanborn, James
DeMarais, Agnes
Seefeldt, Merrlyn
Doucette, Richard
Smith, Jeanette
Duran, Rosanne
Solberg, Darlene
Erickson, Keri
Soltau, Rita
Fair, Bill
Sonju- Thielman, Pat
Fink, Timothy
Spiers, Julie
Gillham, Lynnea
Stevenson, Jim
Gordon, Jacquelin
Stickfort, Marilyn
Grabinski, Robert
Suchy, Sandy
Hoskins, Darla
Theisen, Carrie
Hultberg, Lois
Wolff, Lorraine
F. Consideration of approving a Special Event Permit allowing Walnut Street
closure and use of municipal parking lots for Downtown Block Party on July 11,
2012. Applicant: Partners for Downtown Group /Cornerstone Cafe.
Recommendation: Approve a Special Event Permit allowing temporary closure
of Walnut Street on July 11, 2012 from 9 a.m. to 11 p.m. for the Downtown Block
Party and associated use of public parking facilities and amenities, contingent on:
a. Continued site coordination with Street Superintendent
b. Notification of affected businesses by permit holder
G. Consideration of approving application for 1 -day temporary on -sale liquor license
for Monticello Rotary Club for Taste of the Town event. Recommendation:
Approve the application for a 1 -day temporary liquor license for the Monticello
Rotary Club on September 13, 2012 for Taste of the Town.
H. Consideration of approving a Special Event Permit allowing use of commuter
parking lot and related assistance in conjunction with Rotary "Taste of the Town"
event on September 13, 2012. Applicant: Monticello Rotary Club.
Recommendation: Approve a Special Event Permit allowing temporary use of
the Jefferson Commons Park and Ride Lot from 3 p.m. on September 12t11 through
10 p.m. on September 13, 2012 and associated use of public parking facilities and
City services, contingent on:
a. Continued site plan coordination with the Street Superintendent and City
Engineer.
b. Commuter lot closure signage and notification in coordination with the
Street Superintendent.
c. Notification of affected local businesses by permit holder.
L Consideration of tabling Change Order #1 for the MCC Natatorium
Improvements, City Project No. 11C006. Recommendation: Table this item
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indefinitely pending receipt of information on options pertaining to Change Order
#1 for MCC Natatorium Improvements.
BRIAN STUMPF MOVED TO APPROVE THE CONSENT AGENDA WITH NO
CHANGES. GLEN POSUSTA SECONDED THE MOTION. MOTION CARRIED 5-
0.
6. Consideration of items removed from the consent agenda for discussion
No items were removed.
7. Update of the TIF Management Plan by Northland Securities and Consideration of
ratifying the decision of the EDA to adopt the TIF Analysis and Management Plan
Megan Barnett Livgard led off this item by introducing Rusty Fifield of Northland
Securities. Rusty Fifield provided a presention of the TIF Analysis and Management
Plan and explained that the slides are a highlight of the plan and discussions conducted
with the Monticello Economic Development Authority (EDA). The study process built
on the 2009 study with data being verified and new data added from 2010 through 2012.
Rusty Fifield noted some actions taken since the 2009 report including: the downtown
study, purchase of properties by the EDA, funding for key road projects, met annual
obligations, and decertification of 5 TIF districts. He complimented staff for decertifying
the districts which enables the value to be returned to the entire taxing districts. An
overview of the plan noted that there are 14 districts in the plan with most consisting of 1
to 3 parcels with the majority for housing and job growth. The management of the TIF
districts has been designated under the authority of the EDA. The Management Overview
section contains a detailed review of each TIF district.
Rusty Fifield highlighted some information related to three areas: Pre -1990 districts,
Post -1990 districts, and Post -1990 management issues.
Pre -1990 Districts: There are 2 districts (1 -5 and 1 -6) in this group which can be
decertified or continue to use resources for maximum life of the district. Brian Stumpf
asked how the existing funds could be used if decertified; Rusty Fifield explained some
of the uses such as purchase of property for the downtown plan or economic development
or redevelopment purposes. Lloyd Hilgart asked about purchasing of vacant land and
Rusty Fifield concurred that would be a legitimate use if it was for economic or
redevelopment purposes. Megan Barnett Livgard noted that the budget for the district
would probably have to be modified dependent on the use of funds. Rusty Fifield
explained that, when a district is decertified and there is money left in the district, that
money has to be turned back to the taxing districts which are represented for that property
(city, county, school district, hospital district). Lloyd Hilgart asked about the amount of
money in these TIF districts. Rusty Fifield confirmed there is approximately $450,000 in
the fund balance for TIF 1 -5 projected through the end of 2012, and TIF 1 -6 is projected
at slightly under $600,000 by the end of 2012 and another $90,000 projected for 2013.
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Post -1990 Districts: the majority of the districts fall into this category, which includes
TIF1 -22 (Downtown), 1 -35 (Landmark Square II), and 1 -36 (Rocky Mountain/
Dahlheimer). Rusty Fifield discussed TIF 1 -22 which contains a number of parcels. This
district is under a 5 -year rule which limits future use and has a complicated management
strategy. There is a large fiord balance in this district ($3.23 million) and Rusty Fifield
recommends that there be a determination of the potential use of the funds and possibly
consider decertification of a portion of the district. If the tax increment from the
decertified parcels went back to the taxing districts, the City would realize 41 % of those
funds. Megan Barnett Livgard explained that there is a difficulty in determining how the
current funds can be used and stay within the legal limitations of tax increment financing
laws. Lloyd Hilgart asked if there is a limit on the funds that can be used, would it be
better to turn it back and get back 41 %. Rusty Fifield stated that would require some
complicated calculations to figure out which would be the better option for the City. At
this point, he would recommend analyzing this district to determine the best outcome.
Rusty Fifield talked about TIF 1 -35 (Landmark Square II) which was created as a
redevelopment district from several parcels. A benefit of this district is that the 5 -year
rule was pushed to 10 years, which extends the time to develop the property. The
concerti is that the City is basically locked into this district and may not be able to realize
enough financial support from the district for redevelopment. Rusty suggested it may be
worthwhile checking to see if the obligation can be transferred to another party.
Rocky Mountain Group (Dahheimer Distributing) was set up as TIF 1 -36. It is projected
that not enough tax increment will be generated to repay the EDA's internal loan. Rusty
Fifield recommends this district warrants more investigation as to what did not happen as
expected and thus created this situation.
In summary, Rusty Fifield noted that the City has a well - managed system of TIF districts
and has gained some assets from decertification, and he feels the primary management
focus at this time should be on TIF 1 -22 the Downtown District.
Lloyd Hilgart asked about TIF 1 -36 (Rocky Mountain/Dahlheimer's) and wanted a recap
of the problern with that tax increment district. Rusty Fifield explained that the district
does not generate enough tax increment to cover the amount that the City subsidized with
an internal loan. She explained that the EDA had written down some costs at the
beginning for TIF 1 -36, Megan Barnett Livgard added that the EDA is basically paying
for the loss of tax increment. Rusty Fifield explained that the loss of property value may
have contributed to the unpredictability of the projections for this TIF district. Rusty
noted that they are being much more conservative now in establishing values when they
are establishing TIF districts.
Megan Barnett Livgard requested that Council ratify the TIF Analysis & Management
Plan, which was previously adopted by the EDA.
City Council Minutes —July 9, 2012 Page 5
TOM PERRAULT MOVED FOR ALTERNATIVE #1 TO RATIFY THE EDA
DECISION TO ADOPT THE 2012 TIF ANALYSIS & MANAGEMENT PLAN.
LLOYD HILGART SECONDED THE MOTION. MOTION CARRIED 5 -0.
8. Update on action by the EDA and Consideration of commercial property purchase
(Lot 2, Block 1, Jefferson Commons 1" Addition) and review of development
concepts requested by Mike Krutzi�
Jeff O'Neill summarized the request from Mike Krutzig, which is being brought back to
Council after consideration by the EDA. Mike Krutzig is proposing that the City buy
back property that he purchased some years ago from the City. Jeff O'Neill noted that he
discussed this with former Finance Director Tom Kelly before he left, and Tom Kelly
indicated there are some fiords available in the Jefferson Water Tower bond fund. These
funds have not been designated for another use at this time.
Jeff O'Neill reviewed the various options that would be available to Council. If they so
desire, they could accept Mr Krutzig's proposal and direct staff to prepare documents and
execute doclunents accordingly for the property purchase. Council could indicate support
for the concept but table a decision until an appraisal could be done. Council could also
deny the request.
Jeff O'Neill asked Megan Barnett Livgard to talk about the EDA discussions. Megan
Barnett Livgard explained that this item was reviewed by the EDA and they declined to
use their fund balances to purchase this property. The EDA noted other priorities for
potential land purchases including the downtown redevelopment. They did consider a
possible GMEF loan at a subsequent meeting but decided that was not a viable option
because a loan such as that has to meet certain goals and criteria. Brian Stumpf stated
that the EDA was also concerned about depleting their fund balances when they have
other priorities to consider.
Brian Stumpf stated that he feels this is a win -win proposition for the City as they gain
the land and possibly additional interest if the land is developed by Mr. Krutzig. Clint
Herbst feels that this would not be detrimental for the City as the value of the land is
worth the cost. Glen Posusta spoke against the proposition and noted that the City will be
stuck with taxes from 2011 through 2013. Brian Stumpf said that even with the taxes, the
land is still worth the investment. Glen Posusta said that he does not like setting a
precedent like this. Brian Stumpf feels that anyone should have the right to come to the
City and offer their property for purchase; he feels this is a really good deal as the
purchase price is far less than the market value. Clint Herbst said that he feels the City is
correct in working with Mike Kurtzig on this proposal.
BRIAN STUMPF MOVED FOR ALTERNATIVE #1 ACCEPTING MIKE
KRUTZIG'S PROPOSAL AND DIRECTING STAFF TO PREPARE DOCUMENTS
AND EXECUTE AGREEMENTS FOR PURCHASE OF LOT 2, BLOCK 1,
JEFFERSON COMMONS 1sT ADDITION (155- 176 - 001020). LLOYD FIILGART
City Council Minutes —July 9, 2012 Page 6
SECONDED THE MOTION. MOTION CARRIED 3 -2 WITH TOM PERRAULT AND
GLEN POSUSTA VOTING IN OPPOSITION.
Glen Posusta stated that he does not have any issue with Mr. Kmtzig; he just doesn't feel
the purchase of this property is the appropriate decision for the City.
9. Added items
• Finance Director position — Jeff O'Neill noted that the position has been offered
to Wayne Oberg, who indicated his intention to accept the position. The City is
waiting for background check to be completed before confirming.
Mayor Clint Herbst mentioned that Riverfest takes place this coming weekend
with the MCC Block Party on Thursday from 11 a.m. to l p.m., the Downtown
Block Party on Wednesday evening, Pioneer Park activities on Thursday
including the pie eating contest, fireworks on Friday, Art in the Park and street
dance on Saturday, and concluding with parade and activities in Ellison Park on
Sunday.
10. Adjournment
BRIAN STUMPF MOVED TO ADJOURN THE MEEITNG AT 7:58 P.M. TOM
PERRAULT SECONDED THE MOTION. MOTION CARRIED 5 -0.
Recorder: Catherine M. Shutnan
Approved: July 23, 2012
Attest:
Citf' niistrator
City Council Minutes —July 9, 2012 Page 7