The Melrose City Council met in a Regular Meeting on Thursday, November 16, 2017 at 6:00 p.m. at the Melrose City Center pursuant to due notice being given thereof. Present were Council Members Tony Klasen, Josh Thieschafer, Dick Christenson, and Mayor Joe Finken, City Administrator Michael Brethorst, and City Clerk Patti Haase. Council Member Justin Frieler was absent. Mayor Finken presided thereat.
The Council then recited the Pledge of Allegiance.
A motion was made by Mr. Christenson, seconded by Mr. Klasen and unanimously carried to approve the agenda as amended.
Mayor Finken then opened the floor to public comment. There were no comments.
The following items were considered for approval under the Consent Agenda:
a. the minutes from the Council’s October 16 Special Joint Meeting with the Public Utilities Commission, the October 19 Regular Meeting, the October 26 Special Joint Meeting with the Public Utilities Commission, and the October 26 Special Meeting.
b. list of bills in the amount of $189,985.24
c. list of investments for the month of October
A motion was made by Mr. Klasen, seconded by Mr. Thieschafer and unanimously carried to approve the Consent Agenda items.
The Melrose City Council held a public hearing on the proposed establishment of Municipal Development District No. 12, the proposed establishment of Redevelopment Tax Increment Financing District No. 12-.1 within Development District No. 12, the proposed adoption of a Development Program for Municipal Development District No. 12, and the proposed adoption of Tax Increment Financing Plan relating thereto; all in accordance with Minnesota Statues, Section 469.124 through 469.1799, both inclusive as amended (collectively, the “Act”);
The City Administrator presented the Affidavit of Publication of the hearing notice which was published. There being no further the Public Hearing was closed at 6:05 p.m.
Finance Director Beuning presented the General Fund Financial Third Quarter Report. Ms. Beuning noted that the General Fund Revenue is at 68% and the Expenditures are at 62%. Revenues are low because only half of the Property Tax Revenue and Local Government Aid has been received. Together, these make up 72% of the entire General Fund budget. Building permits and zoning fees have far exceeded budgeted revenues due to large commercial building projects in 2017. Office equip & maintenance costs are at 90% of budget, due to the upgrade to Office 365 and a new server that had not been anticipated this year. Insurance expenses are low across departments as a result of health insurance is budgeted as if all City employees were on the family plan. The City had budgeted for a summer intern, but decided to forego that hire. The 3rd quarter building inspector fees will be paid in October, and the police contract fees from Stearns County have not yet been invoiced.
MADA- Expenditures have well exceeded budgets, and are at 168%. This relates to the necessary costs relating to professional fees for various projects. The General Fund has budgeted a transfer of $8,500, which will be made in December.
Ambulance Department: Ambulance Revenue is at 84% and the Expenditures are at 70%. Both the revenue and expenditures are on track. The Ambulance has charged off a total of $17,629.62 this year, with $6,761.87 collected from the MN Department of Revenue as well as the City’s contracted collections agency.
Fire Department: The Revenue for the Fire Department is only at 13%. This is because 90% of the budgeted revenue comes from Fire Contract charges from the townships and the City’s contribution, and is not collected until December. The Fire Department has adequate reserve funds to meet operational costs until contract revenue is received. The expenditures are at 32% of the budget, due to salaries and building rent not being paid until year end. The vehicle expense is high compared to the budget due to repairs needed on the 1992 fire truck.
Capital Project Funds: These funds include the Capital Improvement Fund, TIF Accounts as well as the 5th Avenue Bridge Improvement Fund. The first half of the TIF proceeds were received in June and July. Capital expenditures currently on track overall.
Police Officer Jeff Eggert presented the Police Department’s October report. He noted there were 329 calls for service during that month, compared to 316 for October 2017. The year-to-date number of calls is 2,943 compared to 3,421 in 2016. A total of 21 citations were written for the month of October. For the month of October, the Department also received 32 agency assist calls.
City Attorney Scott Dymoke reported on projects he has been working on for the City:
• 400 Block: Worked with city staff and consultant to prepare final draft of Business Subsidy Agreement for review and approval by Council.
• Zoning Ordinance: Worked with city staff on preparing proposed amendment to non-conforming use regulations. Submitted draft of amendments to city staff for review by Planning & Zoning.
• East Substation: Reviewed bid specifications for new transformer and contractor’s bid documents. Determined that contractor’s bid documents conformed to bid specifications regarding liability limitations. Advised city staff of determination.
• Tax Forfeiture: Reviewed Kraft Drive and Rose Park court actions to identify City’s interest in property forfeited to the State of Minnesota. Prepared summary of actions and property interests for city staff, with discussion of Melrose’s rights to acquire the forfeited property. City Attorney Dymoke explained the process of acquiring the tax forfeited property.
Mayor Finken stated that Stearns County is requesting that the City of Melrose promote the use of Intrastate Mutual Aid Agreements. The County is recommending creating a mutual aid agreement between managers, much the same as those existing between fire departments, that in the event of a catastrophic emergency there is an arrangement in place to render assistance in accordance with the provisions of the mutual aid agreements. A motion was made by Mr. Christenson, seconded by Mr. Thieschafer and unanimously carried adopting Resolution No. 2017-68, Resolution Promoting the Use of Intrastate Mutual Aid Agreements.
Mayor Finken noted that the City has contracted with Tri-Cap Bus Service to provide busing services in the City of Melrose. There was no change in rate fees for 2018. A motion was made by Mr. Klasen, seconded by Mr. Christenson and unanimously carried approving the 2018 contract for public transportation services with Tri-Cap Bus Service.
Mayor Finken stated that the Council earlier this evening held a public hearing to consider the creation of TIF District No. 12-1 which replaces TIF 11-1 for the downtown Kraft & 400 Block Sites. The council may recall passing a resolution that decertified TIF 11-1 and called for a hearing to recreate it due to issues related to the timing of the certification. The issue was that the certification as presented to the County Auditor’s Office would have had the district certified while there were still partial buildings on the 400 Block parcels. If that were to occur, increments from any future projects would have been cannibalized once demolition was complete. Development Consultant Ryan had asked the Auditor’s Office to delay the certification so that the City could get a final transcript, the state auditor’s office pointed out that it was the request date that would impact the District and after discussing the remedies available, recommended that this would be the cleanest way to resolve certification issues. Because the City has already paid for the creation of TIF 11-1, the consultant will not be charging anything for this replacement District. TIF District No. 12-1 has the same budget, bonding authority and boundaries as was approved in the District which it is replacing.
A motion was made by Mr. Klasen, seconded by Mr. Thieschafer and unanimously carried adopting Resolution No. 2017-69 Resolution Approving the Creation of Development District No. 12 and TIF District No. 12-1 effective upon the approval of the Planning Commission resolution finding that the Development Program conforms to the overall development of the City.
Mayor Finken stated that the Street Department is scheduled to replace the 1998 Front End Loader in 2018. The front-end loader needs replacement due to 20 years of significant use. An assessment was performed by Street/Parks Supervisor Gary Middendorf, and he recommends replacing. A review of multiple loaders was looked at. Based on this review and endorsement of County Roads / Maintenance Department the Volvo is recommended. To secure the 2017 pricing under the State Bid, an order must be place no later than November 30, 2017. If an order comes after that, the 2018 prices will be in effect which are predicted to be higher. The loaders take approximately 90 days, so the sooner the loader is on order the more it can be used in the 2017/2018 snow season. It is recommended to trade the 1998 loader in with the Volvo to receive a credit of $27,500. The City has budgeted $160,000 for the loader and the quote has come in at $145,420. This Loader will be put on a 20-year depreciation of the asset.
A motion was made by Mr. Christenson, seconded by Mr. Klasen and unanimously carried awarding the bid to Nuss Truck and Equipment for the 2018 Volvo L70H Wheel Loader.
Mayor Finken noted that at the November 9, 2017 MADA meeting, discussion was held regarding the remaining 400 Block funding and where it could be directed. They discussed allowing funds to be used on the 400 Block, 400 Block building restoration and development located on the Kraft lot. MADA determined the best course of action was to begin discussion with developers and look at the projects on a case by case basis. When each project is presented to MADA and Council, further discussion will be occurring to find out if the project fits the needs and wants of the City.
City staff have been contacted by Melrose Multi-Family from the recent Kraft Lot Housing project as well as others. It was recommended by MADA that the City Council should consider having further discussions with those developers and look at the possibility of using 400 block funding to incentivize those development projects. Mr. Thieschafer stated that he would prefer seeing the monies be used towards incentives for the development of the Kraft Lot.
A motion was made by Mr. Thieschafer directing staff to have conversations with developers and consider using 400 block funding to incentivize possible Kraft lot or 400 Block development projects. The motion was seconded by Mr. Klasen with a roll call vote recorded as follows: For: Council Members: Thieschafer, Klasen, Christenson, and Mayor Finken; Absent: Council Member Frieler.
Mayor Finken noted that at the November 9, 2017 MADA meeting, MADA made a recommendation the Council consider replacing the one-sided West Bound I-94 Billboard that was destroyed by the September 2017 windstorm and use the Insurance proceeds toward the purchase of a new two-sided billboard. As per comments from League of MN Cities Insurance Adjustor, the City will be receiving up to $15,646.50 from insurance. Two quotes were received and lowest quote from Froggy Signs. If the Council were to award the project the contractor stated, they would try to begin the project in mid-December.
Mr. Klasen recommended tabling the item to determine if there are restrictions as to how the insurance money can be spent or if it can be used for advertising through social media or other promotional advertising. Staff was also asked to obtain pricing of a digital billboard.
A motion was made by Mr. Klasen seconded by Mr. Thieschafer and unanimously carried to table this item to be brought back before the Council at its December meeting.
Mayor Finken stated that the Parks and Recreation Board has recommended that the City conduct a trial of forgoing staffing of the ice rink. Due to very low utilization by skaters, the Board feels that an attendant may not be needed. As in interim solution, the Streets / Parks Staff will open the warming house. The Police Department will close the warming house. If there is deemed a need for an attendant, based on the reports of damage to public property or increased utilization, staff would look to hire an attendant if needed. A motion was made by Mr. Christenson seconded by Mr. Klasen and unanimously carried authorizing conducting a trial period for not staffing the ice rink and to allow staff to hire a temp attendant if it is deemed needed by the Streets Parks Supervisor and City Administrator.
CentraCare Health – Melrose is a Minnesota Critical Access, not-for-profit hospital which provides health care services to the Medicare and Medicaid population in addition to supporting programs that benefit the indigent, uninsured or underinsured population in the region in and adjacent to Melrose, Minnesota. In order to participate in the 340B Program, CentraCare Health-Melrose must enter into an agreement with a unit of local government pursuant to which CentraCare Health Melrose commits to provide health care services to low income individuals who are not entitled to Medicare or Medicaid benefits. CentraCare Finance Director Adam Paulson will be in attendance to answer any questions. A motion was made by Mr. Klasen, seconded by Mr. Thieschafer and unanimously carried approving the MOU Between the City of Melrose, MN and CentraCare Health – Melrose.
Mayor Finken stated that the City Council at its September and October Council meetings directed that WSB prepare a quote for services for the permitting requirements relating to the 5th Ave Bridge. Additionally, the Council has directed that a final pre-decisional meeting occurs between WSB, city staff, council liaison and effected regulatory agencies. This meeting occurred, and it was determined that it is probable that a permit would be granted. However, a formal submittal must occur to determine if this will occur or not. During the meeting, the DNR suggested the City consider a Rock Arch Dam as part of the project. To provide real consideration, additional information to include costs and potential funding sources as well as permitting requirements were collected. The DNR has requested the City explore a Rock Arch Dam to replace the existing Dam. Nicki Blake-Bradley DNR Water Area Hydrologist for Stearns provided a presentation on the Rock Arch Dam.
A motion was made by Mr. Thieschafer, seconded by Mr. Klasen and unanimously carried approving the proposal from WSB & Associates for the CLOMR and EAW for channel realignment and rock arch dam.
A motion was made by Mr. Thieschafer seconded by Mr. Christenson and unanimously carried authorizing WSB & Associates to develop concept plans for the Rock Arch Dam and to include the Rock Arch Dam into the EAW for Bridge project.
Mayor Finken stated that the ADHOC Personnel Committee met with AFSCME on November 14, 2017. The PUC met on Monday, November 13, 2017 and discussed their final counter offer of Longevity Pay with AFSCME. After much discussion and debate, the Commission and AFSCME came to an agreement and settled and agreed to modify the Personnel Policy that address Longevity
The Adhoc has requested that this be added to the Council meeting on Nov 16, 2017 for modification to the Cities Personnel Policy. The Commission will formally action at their December 11 PUC meeting to amend the Personnel Policy and formally adopt the AFSCME contract as discussed and approved conceptually with during the Joint PUC / Council working meetings.
The Longevity Pay of the Personnel Policy was amended as discussed. A copy is on file at the City Office.
A motion was made by Mr. Thieschafer approving the amendment to the Personnel Policy. The motion was seconded by Mr. Christenson with a roll call vote recorded as follows: For: Council Members: Thieschafer, Christenson, and Mayor Finken; Abstain: Council Member Klasen; Absent: Council Member Frieler.
Mayor Finken stated that the LELS contract has been approved by the LELS members and is within the parameters as set during the Council / Commission Joint meeting to discuss wage and benefits. The AFSCME agreement is also with in parameters as set by the Council and Commission except for longevity pay, which is addressed in the Personnel Policy and not addressed in the Collective Bargaining agreements.
A motion was made by Mr. Thieschafer, seconded by Mr. Klasen and unanimously carried approving the 3-year LELS contract as presented.
A motion was then made by Mr. Christenson, seconded by Mr. Klasen and unanimously carried approving the 3-year AFSCME contact as presented.
Mayor Finken noted that according to the Fire Department Policies, Officers’ terms expire every two years. The terms will expire on January 1, 2018; therefore, applications for 1st Assistant Chief, 2nd Assistant Chief, and Training Officer were accepted through October 15.
Five applications were received for the two Assistant Chief positions and two applications were received for the Training Officer position. Interviews for the Assistant Chiefs and Training Officer were conducted by the newly elected Fire Chief and Executive Fire Relief Association Executive Committee Members.
They are recommending: Joe Woeste be appointed as 1st Assistant Chief, Leon Feldewerd as 2nd Assistant Chief and Luke Blonigen as Training Officer.
A motion was made by Mr. Thieschafer, seconded by Mr. Klasen and unanimously carried approving the Officer appointments for 2018 and 2019.
Consideration was then given to the proposed 2018 meeting schedule. The meetings for all months are scheduled for the third Thursday of the month, except for January which will have a meeting on both the first and third Thursday of that month.
A motion was made by Mr. Christenson, seconded by Mr. Klasen and unanimously carried approving the 2018 meeting schedule.
The following informational items were reviewed:
a. The following is a list of schools and/or conferences where registrations were made:
1) Payroll Deduction Webinar. November 2. Office Assistant Doris Rieland
b. Utilities Commission’s October 9 Regular Meeting minutes, and the October 9 Special Meeting with Industry.
A motion was made by Mr. Klasen, seconded by Mr. Thieschafer and unanimously carried that the meeting be adjourned at 8:00 p.m.
Patricia Haase, City Clerk