The Melrose City Council met in a Regular Meeting on Thursday, September 15, 2016 at 6:00 p.m. at the Melrose City Center pursuant to due notice being given thereof. Present were Council Members Jenny Mayers, Dick Christenson, Tony Klasen, Josh Thieschafer, Mayor Joe Finken, City Administrator Mike Brethorst, Finance Director Tessa Beuning, and City Clerk Patti Haase. Mayor Finken presided thereat. The Council then recited the Pledge of Allegiance.
A motion was made by Ms. Mayers, seconded by Mr. Thieschafer and unanimously carried to approve the agenda as amended.
Mayor Finken commented on the City’s recent fire in the downtown area. Mr. Finken stated that multiple families and businesses have been affected. Please keep them in your prayers. Melrose has been hit hard in 2016. Almost everyone in our City has been hit emotionally or financially with the fires on Main Street and St. Mary’s Church. Our city will endure. We will become stronger going forward into 2017.
Mayor Finken also reminded the community of the upcoming Rummage Sale being held on Friday, September 16 from noon until 6:00 p.m. and again on Saturday, September 17 from 8:00 a.m. until 6:00 p.m. Proceeds will go to those families and businesses affected by the fire.
The following items were considered for approval under the Consent Agenda:
• The minutes from the Council’s August 18 Special Meeting, the August 18 Special Joint Meeting with the Public Utilities Commission, and the August 18 Regular Meeting
• List of bills in the amount of $602,628.48
• List of investments for the month of August
• Resolution No. 2016-34, Resolution Appointing Election Judges. The election judge appointments are for the General Election that will be held on Tuesday, November 8, 2016.
Gambling Resolution: 1) Resolution No. 2016-35, Resolution Approving Gambling License to the Melrose Chamber of Commerce for an exemption from lawful gambling license to conduct a raffle on Friday, November 25, 2015 at 223 Main Street East, Melrose MN.
The Council to give consideration approving the 2016-2017 Safety Management Program Contract between the City and the Minnesota Municipal Utilities Association (MMUA) for their safety program. The agreement is in effect from October 1, 2015 through September 30, 2016. Total program fees have increased $375. The fees are cost shared between the general and utilities funds.
The Council to take action concurring with the Commission approving the Safety Management Program Contract.
On September 7, Office Assistant I Doris Rieland will complete 6 months of service with the City. She is eligible for a six calendar-month step increase. Finance Director Beuning has conducted a review and it is favorable; therefore, recommends approval of a step increase from Step 4 to Step 5. The Council to take action concurring with the Commission approving Ms. Rieland’s step increase.
A motion was made by Mr. Christenson, seconded by Mr. Thieschafer and unanimously carried to approve the Consent Agenda items.
Mayor Finken then opened the Public Hearing at 6:04 p.m. on the vacation of that portion of Second Avenue NW (originally known as Pennison Avenue in the plat and survey of Fair View Addition to Melrose) lying southerly of the north line of Block Two (2), Fair View Addition to Melrose, extended easterly to its intersection with the easterly right of way line of Second Avenue NW.
The three parcels which about the portion has been petitioned to be vacated. The purpose of the requested vacation of the part of undeveloped 2nd Avenue is to facilitate the construction of a new home and to clean up historical platting and ownership issues. City Administrator Brethorst presented the Affidavit of Publication of the Hearing Notice which was published.
Mayor Finken asked if there were any additional comments or concerns regarding the Vacation request.
No further comments were forthcoming; therefore, the public hearing was closed at 6:05 p.m.
Police Chief Craig Maus presented the Police Department’s August monthly report. He noted there were 415 calls for service during that month compared to 247 for August 2015. A total of thirty-one citations were written for the month of August. The year-to-date number of calls is 2748 compared to 2014 in 2015. For the month of August 2016, the Department received 33 agency assist calls.
City Attorney Scott Dymoke reported on projects he has been working on for the City.
• Community Development, Melrose Multi-Family Project: Reviewed development concerns raised by Melrose Multi-Family’s survey and preliminary development plan with City Staff and City Engineer, including zoning, shoreland and utility issues.
Mayor Finken noted that a Public Hearing was held earlier this evening on the vacation of easement relating to the Petition from Carl and Bri Worms for the vacation of a Public Right of Way for the construction of a new residential home to be constructed in 2017. All abutting neighbors have signed the petition and are in agreement with the vacation. Under the distribution of vacated land, it shall return to the original platted parcels. Mr. Kraker has requested that he be given the addition 25 that would normally be given back to the parcel currently owned by the City. This would square up his parcel. The Melrose Area Development Authority at its July 6 meeting has reviewed this application and recommended approving the land sale. The Melrose Planning and Zoning Board have also approved the vacation and states it is in compliance with the City Comprehensive Plan.
Council Member Thieschafer introduced Resolution No. 2016-36, A Resolution Vacating A Portion of Second Avenue NW (Originally Known as Pennison Avenue) and Reserving Utility and Drainage Easements). The motion was seconded by Mr. Klasen with a roll call vote recorded as follows: For: Council Members Thieschafer, Klasen, Mayers, Christenson, and Mayor Finken; Against: None.
Mayor Finken stated that the City of Melrose has contracted with Stearns County Attorney’s Office since 2015. The contract is set to expire December 31, 2016. It was originally estimated that the Department would send 100 cases per year to the County for Prosecution. However, the police have been sending on average 190 citations per year. The County charges on a per case basis they have proposed to provide billing based on an average of 150 citations per year. The county is proposing an increase from $12,500 to $16,500 per year under the same terms.
A motion was made by Ms. Mayers, seconded by Mr. Christenson and unanimously carried to approve the two year contract as presented.
Don Hickman, Vice President for Community & Workforce Development for the Initiative Foundation stated that in an effort to aid the Community of Melrose, the Initiative Foundation (IF) located in Little Falls has offered to host the management and creation of a Community Fund. The IF has provided this same resource within the past six years to the communities of Wadena and Hewitt. Wadena received assistance when it was hit by a tornado and Hewitt after flooding. Both have found great success with this program and both of which have stated that they would follow the same processes.
If funds are raised they would cover expenses such as: Urgent (food/shelter/ clothing) needs, support relief and clean-up efforts, and facilitate planning and projects to rebuild the community during the aftermath of a disaster including business recovery. If enough funds are raised, the Fund could remain in place to be used for future community relief projects. The fund would work as follows: A request would come in from an outside case management team such as Catholic Charities. They would then submit this request to a local Steering Committee whom would then consider the request based on set rules for consideration. (Note the expense examples as noted in the paragraph above.) The Steering Committee would then recommend to the Initiative Foundation to release the funds. The IF would then review it then if within the parameters they would the release the funds. The fund would be managed the by the IF. There are no administrative fees for the first 12 months. They will aid in marketing and the fund and assist with pledges and all administrative costs. If the fund is still needed after the first year, a fee of 2 percent will be issued. However, if the fund is still active and directly supporting the fire, it is likely the fee would be waived upon a valid request.
A motion was made by Ms. Mayers, seconded by Mr. Thieschafer and unanimously carried allowing the Initiative Foundation to form the fund as outlined in the Melrose Area Relief Fund Agreement.
Mr. Hickman stated that the Initiative Foundation has funds available for eligible projects to help seed the Relief Funds. Staff has submitted a letter of interest to the IF relating to the Grant. If approved, the IF would then allow for a full grant request. There is no local match required for this grant.
A motion was made by Mr. Klasen, seconded by Mr. Christenson and unanimously carried authorizing staff to submit a formal grant request to the Initiative Foundation. Mr. Hickman informed the Council that just prior to the meeting this evening he was notified that AgStar Financial Services announced a $25,000 grant to the Little Falls based Initiative Foundation to help relief efforts following the September 8 fire through the historic downtown that damaged eleven Main Street businesses and eight apartments, causing almost $600,000 in damage.
Finance Director Beuning presented the proposed 2017 Budget for the General Fund. State law requires that the City certify the proposed tax levy to the County Auditor by no later than September 30; therefore, it will be necessary to review the budget and take action on adoption of the proposed preliminary budget and the proposed tax levy at this meeting. The final levy adopted in December can be lower than the levy certified in September, but cannot be higher.
It is proposed that the preliminary property tax levy be certified at $950,000. Also included is a total debt levy of $445,000 for a total proposed tax levy of $1,395,000 and an estimated tax capacity rate of 70.72% which is a decrease from the final levy of 71.199% for 2016 taxes payable. The City must also provide the County Auditor with precise information on:
1) Time and place of a public hearing for the adoption budget and levy will be discussed.
2) The public must have the opportunity to speak and the meeting must not be held before 6:00 p.m.
3) Date, place and time of the public hearing at which the final budget and levy will be determined, with this meeting to be scheduled after November 24 and before December 27.
a) Staff recommends this hearing be scheduled for the December 15 at 6 p.m. at the Melrose City Center.
4) Phone number 320-256-4278 that City taxpayers may call if they have questions related to the auditor’s property tax notice, which is generally delivered in November.
5) Address where comments will be received by mail. 225 1st Street NE, Melrose, MN 56352 Attn: Finance Director.
The above-noted items are part of the revised Truth in Taxation requirements. The information must be included in the minutes and the City must comply with existing publication requirements for minutes.
The Council to take action on the proposed tax levy, as well as date(s), times, etc. where the budget will be discussed and/or adopted.
The City must certify the proposed 2016 tax levy to the County Auditor and adopt the proposed 2017 Budget on or before September 30.
Mr. Christenson introduced Resolution No. 2016-37, Resolution Adopting Proposed Tax Levy Approving 2016 Tax Levy, Collectible in 2017 and Setting Hearing Dates (See attached resolution). The motion was seconded by Mr. Klasen with a roll call vote recorded as follows: For: Council Members Christenson, Klasen, Mayers, Thieschafer, and Mayor Finken; Against: None.
A motion was made by Mr. Thieschafer, seconded by Ms. Mayers and unanimously carried approving the preliminary 2017 Budget.
Mayor Finken noted that the City proposes to establish a Tax Increment Financing District (the “TIF District”) qualified as an economic development district within a Development District to be established, and proposes to adopt a tax increment financing plan for the TIF District (the “TIF Plan”).
The City has determined to pay for certain costs to be identified in the TIF Plan consisting of land/building acquisition, public utilities, site improvements/ preparation, other eligible improvements, and administrative costs (the “Qualified Costs”) incurred in connection with the establishment of the TIF District and development/redevelopment of land within the TIF District, which costs will be financed on a temporary basis from City funds available for such purposes.
Under Minnesota Statutes, Section 469.178, Subd. 7, the City is authorized to advance or loan money from the City’s general fund or any other fund from which such advances may be legally made, in order to finance the Qualified Costs. The City intends to reimburse itself for the payment of the Qualified Costs, plus interest thereon, from tax increments derived from the TIF District in accordance with the terms of this resolution (which terms are referred to collectively as the “Inter-fund Loan”).
Ms. Mayers introduced Resolution No. 2016-38 Resolution Approving the Terms Of Up To A $1,000,000 Inter-fund Loan in Connection With A Proposed Tax Increment Financing District (Economic Development). The motion was seconded by Mr. Thieschafer with a roll call vote recorded as follows: For: Council Members Mayers, Thieschafer, Christenson, Klasen, and Mayor Finken; Against: None.
City Administrator Brethorst noted that the City also proposes to establish a Tax Increment Financing District (the “TIF District”) qualified as a redevelopment district within a Development District to be established, and proposes to adopt a tax increment financing plan for the TIF District (the “TIF Plan”).
The City has determined to pay for certain costs to be identified in the TIF Plan consisting of land/building acquisition, public utilities, site improvements/ preparation, other eligible improvements, and administrative costs (the “Qualified Costs”) incurred in connection with the establishment of the TIF District and development/redevelopment of land within the TIF District, which costs will be financed on a temporary basis from City funds available for such purposes. Under Minnesota Statutes, Section 469.178, Subd. 7, the City is authorized to advance or loan money from the City’s general fund or any other fund from which such advances may be legally made, in order to finance the Qualified Costs.
The City intends to reimburse itself for the payment of the Qualified Costs, plus interest thereon, from tax increments derived from the TIF District in accordance with the terms of this resolution (which terms are referred to collectively as the “Inter-fund Loan”).
Mr. Christenson introduced Resolution No 2016-39 Resolution Approving the Terms Of Up To A $250,000 Inter-fund Loan in Connection With A Proposed Tax Increment Financing District (Redevelopment District). The motion was seconded by Mr. Klasen with a roll call vote recorded as follows: For: Council Members Christenson, Klasen, Mayers, Thieschafer, and Mayor Finken; Against: None.
Mayor Finken noted that the City has reached the end of the three year contract with our auditors, Abdo, Eick & Meyers LLP. The City has used the services of Abdo, Eick & Meyers for many years and is happy with their knowledge and experience. Staff has worked diligently to perform much of the prep work, as well as preparing the financial statements in house, to reduce our audit costs. The City/Melrose Public Utilities paid $30,000 for audit services for fiscal year 2015, which included one-time fees of $1,500 for the implementation of GASB 68, as well as $1,500 for the implementation of the CAFR. That would bring the audit fees for 2015 to $27,300. The fee quoted from 2016-2018 is $28,800-$29,800. This is a 1.7% increase proposed for the second and third years.
Council Member Thieschafer inquired as to the last time staff had completed an RFQ for Audit Service. Ms. Beuning noted that Abdo, Eick and Meyer has been the City’s auditing firm for at least the past ten years. Mr. Thieschafer stated that he believes it is good business practice to occasionally obtain quotes on contracts of this size, in order to ensure the City is getting the best value for its money.
The Council directed staff to obtain additional quotes for Audit Service to be presented at the next regular meeting.
Mayor Finken stated that in an effort to provide potential assistance for the redevelopment of the 400 Block of Melrose Downtown, the City can declare an intent to provide assistance in the form of TIF. This intent is to preserve the opportunity to aid the property owner in rebuilding the site. By adopting the Resolution, it is setting a date that anything after the adoption date would be eligible for participation in a Redevelopment TIF District. The City is not creating the district, but it is keeping the door open to the possibility.
Mr. Thieschafer introduced Resolution No. 2016-40 Resolution Making Certain Finding with Respect to a Substandard Building. The motion was seconded by Ms. Mayers with a roll call vote recorded as follows: For: Council Members Thieschafer, Mayers, Christenson, Klasen, and Mayor Finken; Against: None.
The following informational items were discussed:
The minutes from the Utilities Commission’s August 10 Regular Meeting
Planning for the retaining wall is well underway. A meeting was held on Monday, August 29 with the MN DNR, Army Corp. of Engineers, WSB and City Staff to review a conceptual plan. The plan included a rip-wrap retaining wall, with a 6 foot bench. Concerns were raised by the DNR and Corp. of Engineers that the retaining wall must have a 0.00 rise in flood elevations of the site. Therefore, efforts are needed to prove via an engineering flow model that there will be a 0.00 rise in elevation.
There are multiple ways to ensure this, such as removing sediment from the spill way, widening the channel to increasing the slop of the retaining wall. Another option is to modify the spill way on the north side of the spill way. This is the least preferred as it is anticipated to be very costly.
As of the meeting, it was still planned to encroach into the spill way with stream bars as well as with the retaining wall rip-wrap. It may be needed to include natural grasses to the retaining wall to secure the graded slopes. This is pending final review and plans. The Army Corp. of Engineers has started their historical review of the site. It is anticipate their comments will be back at the end of October. This may delay the overall planning for the retaining wall. However, we are still moving forward with design and comments from regulatory stake holders.
It is anticipated that we will have a 90% solution/plan complete on or around October 30, 2016.
Charter Communications has sent notification that they are making changes to the channel lineup for customers in our community. Effective on or after September 27, 2016 OVATION HD will be added to the channel lineup on channel 849. OVATION HD is a value added channel addition at no cost to our customers who enjoy OVATION SD on channel 127 on the regular channel lineup. You can go to www.spectrum.com for a complete channel lineup.
Planning and review efforts are well underway for the Melrose-Multi-Family project. A draft site plan has been presented to staff. Efforts to coordinate planning efforts between the 5th Ave Bridge Project/1st Street Plan, Kraft Retaining Wall and the Melrose Multi-Family Development are needed to ensure one does not inadvertently affect the other. CAD drawing and comparative reviews of the various plans are underway.
The next mile stone is to complete the comparative reviews, followed by final draft submittals to the City for Code Compliance. This will then determine the CUP and Variance processes that will be needed. Plus, it will clarify Easement, Right-of-Way, access points and etc. There are several moving parts for this project that need to be consolidated to ensure an open and smooth review process.
Additionally, efforts are underway to determine costs by the developer. This will then determine the gap needed to facilitate the development project. It is anticipated the next public milestone will be in November, when the Planning Commission will be given an opportunity to formally review and comment on the plan. There is a planned staff meeting with Melrose Multi-Family on September 13, 2016 to review the status.
The following are schools and/or conferences where registrations were made:
1) Black Oak Getty Wind, August 2. Attending: Commission Member Dick Christenson, Electrical Supervisor Dale Lyon and Line Worker Steve Scholz
2) MMUA Summer Conference, August 15-17. Attending: Electrical Supervisor Dale Lyon.
3) Regional Policy makers, August 30. Attending: City Administrator Michael Brethorst, Commission Members Dick Christenson and Jeremy Kraemer and Electrical Supervisor Dale Lyon
4) MRES Leadership Academy, October 5-6. Attending: City Administrator Michael Brethorst.
5) MRES Technology Days, September 19-21. Attending: Accounting Clerk Stacy Funk
A motion was made by Ms. Mayers, seconded by Mr. Klasen and unanimously carried that the meeting be adjourned at 7:05 p.m.
Patricia Haase, City Clerk