Winsted City Council Minutes |
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City of Winsted City Council Work Session Conference Room – Lewis Room December 16, 2008 4:15 p.m. Present: Mayor Steve Stotko Council Member Tom Ollig Council Member Bonnie Quast Council Member Tom Wiemiller Council Member Dave Mochinski Staff Present: Brent Mareck, City Administrator Deb Boelter, City Clerk-Treasurer Fran Eggert, City Attorney I. Call To Order Mayor Stotko called the meeting to order at 4:15 p.m. II. Transfer of Historic City Hall Eggert presented his letter to the City of Winsted Mayor and Council dated November 26, 2008 regarding some issues that needed to be addressed by the City Council before consummating the transfer of the historic city hall to the Colonnas. The items discussed by the City Council included: 1. Right of First Refusal. 2. The installation of a deck. 3. Beach and shoreline easement. III. 2009 Budget and Levy The City Council discussed the proposed 2009 final budget and levy. IV. Updates A. Innovation Schedule – 2009 Budget Mareck distributed an Innovation Schedule detailing areas of the 2009 budget where staff can expend less resulting in a cost savings to the 2009 Budget. Mareck stated that staff will continue to evaluate areas of the budget, and supply purchases, to reduce spending. V. Adjourn Ollig motioned to adjourn. Wiemiller seconded. Motion carried 5-0. Respectfully submitted, Deborah R. Boelter City Clerk-Treasurer City of Winsted City Council Meeting Council Chambers December 16, 2008 5:00 p.m. Present: Mayor Steve Stotko Council Member Bonnie Quast Council Member Tom Ollig Council Member Tom Wiemiller Council Member Dave Mochinski Staff Present: Brent Mareck, City Administrator Deb Boelter, City Clerk-Treasurer Fran Eggert, City Attorney 1) Mayor Stotko called the meeting to order at 5:00 p.m. a) The Pledge of Allegiance was taken. 2) Consent Agenda Quast motioned to adopt the Consent Agenda as presented. Wiemiller seconded. Motion carried 5-0. a) Minutes - City Council Work Session – December 3, 2008 Accepted the minutes of the City Council Work Session of December 3, 2008. b) Minutes – Regular City Council Meeting – December 3, 2008 Accepted the minutes of the Regular City Council Meeting of December 3, 2008. c) Schedule Public Hearing – 2009 Fee Schedule Scheduled a public hearing for January 20, 2008 to consider the adoption of the 2009 Fee Schedule by ordinance. d) The Church of the Holy Trinity – Gambling Contribution Accepted a contribution from gambling proceeds from the Church of the Holy Trinity in the amount of $2,500 to be dedicated to the city’s Park Fund. e) 4M Funds – Notification To Broker and Certification by Broker Authorized Voyageur Asset Management, Incorporated to invest the City of Winsted’s 4M Fund in those investments complying with the requirements of Minnesota State Statutes 118A.04, 118A.05 and 118A.06 for 2009. f) 4M Funds – Notification To Broker and Certification by Broker Authorized RBC Dain Rauscher to invest the City of Winsted’s 4M Fund in those investments complying with the requirements of Minnesota State Statutes 118A.04, 118A.05 and 118A.06 for 2009. g) Northland Securities, Incorporated – Notification To Broker and Certification by Broker Authorized Northland Securities, Incorporated to invest the City of Winsted’s funds in those investments complying with the requirements of Minnesota State Statutes 118A.04, 118A.05 and 118A.06 for 2009. 2 h) Northland Securities, Incorporated – Notification To Broker and Certification by Broker Authorized Northland Securities, Incorporated to invest the City of Winsted Economic Development Authority’s (EDA) funds in those investments complying with the requirements of Minnesota State Statutes 118A.04, 118A.05 and 118A.06 for 2009. i) Flagship Bank of Winsted – Pledged Securities Approved the Pledged Securities that Flagship Bank of Winsted has purchased for the City of Winsted for the month of December, 2008 in the amount of $1,750,000 and the Federal Deposit Insurance Corporation (FDIC) in the amount of $250,000. j) City of Winsted Asset Listing – Capitalization Threshold * Approved the capitalization threshold for the City of Winsted asset listing to be set at $5,000. k) Building Permit Report – November, 2008 Approved the November, 2008 Building Permit report as presented. l) Financial Report – November, 2008 Approved the November, 2008 Financial report as presented. m) Close City Offices – Friday, December 26, 2008 Approved the closing of the city offices on Friday, December 26, 2008. n) Claims Approved the Claims List for December 16, 2008 as presented. “Don C. Guggemos” Community Service Awards: a) Business/Group Award – Millerbernd Design and Fabrication / Herald Journal Publishing Mayor Stotko presented a Community Service Award to Brad Millerbernd, Millerbernd Design and Fabrication, for their donation of the City of Winsted entrance signs. Mayor Stotko presented a Community Service Award to Chris Schultz and Dale Kovar, Herald Journal Publishing, for their work on the City of Winsted entrance signs and their many other contributions to the community. b) Individual Award – Jerome Thiemann Mayor Stotko presented a Community Service Award to Jerome Thiemann for his service to the City of Winsted in many areas. c) Youth Award – Students of Mrs. Lois Danielson Mayor Stotko presented a Community Service Award to Mrs. Lois Danielson and the Holy Trinity High School students for the landscaping they completed in Mill Reserve Park. City of Winsted - “Employee of the Year”: a) Raquel Kirchoff Mayor Stotko presented the “Employee of the Year” award to Raquel Kirchoff and thanked Raquel for her exemplary work as an employee of the City of Winsted. 3) No Public Hearings. 3 4) No Old Business. 5) New Business a) Resolution R-08-25 – 2009 Budget and Levy Mareck stated that the City Council conducted a Truth-in-Taxation public hearing at their Wednesday, December 3rd, 2008 regular City Council meeting to solicit feedback on the proposed 2009 budget and levy. The City Council adopted a preliminary levy in September, 2008 of $1,082,143, which is a 6.9% increase over the 2008 levy. The City Council asked for a 0% levy increase option in November, 2008 which amounts to $1,011,373. The 0% levy increase ($1,011,373) was presented as the preferred alternative during the truth-in-taxation hearing. Mareck presented the following information: LEVY HISTORY 2005 2006 2007 2008 2009 0% General Levy $654,736 $744,433 $743,036 $712,573 $654,323 Bond Levy $251,400 $193,700 $193,700 $298,800 $357,050 Total Levy $906,136 $937,133 $936,736 $1,011,373 $1,011,373 TAX CAPACITY HISTORY Actual 2006 Actual 2007 Actual 2008 Estimated 2009 Tax Capacity $1,404,667 $1,461,174 $1,569,570 $1,595,363 Levy $937,133 $936,736 $1,011,373 $1,011,373 Tax Rate 68.029% 64.700% 63.596% 61.770% 4 2009 TAX PROJECTIONS 2008 Market Value Tax Capacity Tax Rate Tax $175,000 $1,750 63.596% $1,113 2009 Market Value Tax Capacity Tax Rate Estimated Tax $175,000 0% $175,000 6.9% $1,750 $1,750 61.770% 66.207% $1,081 (-$32) $1,159 (+46) Mareck stated that the city has been strongly promoting its intent to adopt a levy with a 0% increase; however, in recent weeks there appears to be a growing threat from the State of Minnesota that cities may be losing a considerable amount of their Local Government Aid (LGA). Members of the City Council have requested that both the 0% and 6.9% increase be presented for their review. Adopting the 6.9% increase could provide a $70,000 plus “cushion” to address probable cuts to LGA. However, public participation in the Truth-in-Taxation process could have been diminished with the city’s public attempt to spread the word about the 0% increase. Mareck continued by stating that the choice is essentially a policy decision for the City Council, based on their individual comfort level, in cutting certain expenditures, services and possibly staff as are necessary to manage looming LGA cuts. Ollig addressed the residents of the City of Winsted stating that the City Council does not want to raise taxes; however, Ollig stated that he believes that the City Council should approve a 6.9% increase for the 2009 budget and levy due to the proposed cuts to the city’s 2009 LGA from the State of Minnesota. Ollig stated that he does not want to cut essential city services and/or staff. Ollig reminded residents that the proposed 2009 property tax statements that they received reflected the 6.9% increase so their property taxes would remain as shown on the statement. Ollig recommended that the City Council proceed with the 6.9% increase. Mochinski stated that he believes that the City Council should approve a 0% increase to the 2009 budget and tax levy, and not raise taxes. He believes that there are other areas that the city can make cuts to the budget. Ollig stated that the City Council should consider that if they approve a 0% increase, they may have to raise taxes substantially in 2010. Quast stated that she would also like to see a 0% increase but understands that to provide essential services to the residents who elected them, a 6.9% increase should be approved. Quast also stated that the City Council has asked the city’s Department Heads to decrease spending and identify areas in the budget that could be cut. Wiemiller stated that he believes that the City Council should approve a 6.9% increase to the 2009 budget and levy, the city should control future spending, and identify areas of the budget than can be cut. Wiemiller stated that in the past he has seen large tax raises due to LGA cuts and would prefer not to do it again. 5 Mayor Stotko stated that he would also like a 0% increase but understands the need to approve the 6.9% increase and put the money in reserve, and to make additional cuts to the 2009 budget. Don Guggemos, 137 Fairlawn Avenue East, addressed the City Council and stated that he agreed with what the City Council was saying. He also asked the City Council to recognize the increased property tax impact the residents may face in 2010 if they approve a 0% increase in 2009. Guggemos recommended that the City Council approve the 6.9% increase and limit spending. Ollig motioned to adopt Resolution R-08-25 certifying the 2009 tax levy in the amount of $1,082,143 and adopting the 2009 budget with a 6.9% increase. Wiemiller seconded. Motion carried 4-1. Mochinski opposed. Ollig motioned to freeze 2009 capital spending and to initiate a freeze on 2009 salary increases until further notice. Quast seconded. Motion carried 5-0. b) Rental Housing Requirements – Extension Request Mareck stated that the Building Inspector performed a rental housing inspection at 145 - 1st Street North (four (4) residential units) on November 18, 2008. During this inspection, several minor deficiencies were noted, along with two major deficiencies: 1. Unit 1 – Need to provide an operable window to the exterior. 2. Unit 4 – Provide a 36” guardrail on stairs. Repair rotted wood on porch, caulk, and paint. Provide a structural engineer’s report that the porch and stairs meet required loads. Mareck stated that the property owner, Darrell Lachermeier, has agreed to correct the minor deficiencies within thirty (30) days; however, he is asking the City Council for an extension to deal with and/or investigate the two major deficiencies. Mr. Lachermeier was informed that the Council may be open to an extension of time for the removal of the stair and porch system, which would correct the deficiencies. Mr. Lachermeier wants an extension to consider his options for addressing the deficiencies and not for additional time to remove them or make the necessary corrections. Mr. Lachermeier’s request to delay action is based on the possibility that grant funds may become available in the spring, 2009 to assist him with this project. Mareck stated that there is a risk associated with an extension for code corrections based on the availability of grant funds that the city may or may not receive. The corrections that Mr. Lachermeier has requested an extension for, (operable window and the investigation of the structural deficiencies with the back stair and porch system), are life safety issues. Mr. Lachermeier has contended that these conditions have existed for many years; however, the city failing to appropriately enforce a discovered code violation may put the city and tenants of the building in a position of unnecessary risk. Mareck presented copies of the “Rental Dwelling Inspection” reports for each unit. Quast stated that she believes that both deficiencies identified are life threatening to the renters of the property and the city should not grant an extension. Quast motioned to deny a request for an extension to meet minimum rental housing standards at 145 – 1st Street North. Ollig seconded. Motion carried 5-0. c) Lease Agreement – AT & T Mareck presented AT&T’s proposal to lease space on the City of Winsted’s water tower and to construct a utility building in Hainlin Park for the operation of cellular antenna equipment. The City Council has previously granted a similar request to T-Mobile (formally known as VoiceStream). 6 AT&T would like to construct an 11-1/2 feet by 20 feet utility building to house much of their equipment, while placing antenna and related equipment on top of the water tower. The utility building would be placed to the east of the water tower, between the well house and the water tower. Mareck presented a site plan showing the location of the utility building. Mareck stated that AT&T initially offered $1,500 per month for rent, for a five (5) year term that would automatically renew for four (4) additional, five (5) year terms. Through a negotiation process with the city, AT&T is now prepared to pay $1,850 per month for rent for a five (5) year term that would automatically renew for three (3) additional, five (5) year terms. The current proposed lease agreement would generate an additional $22,000 in revenue for the City of Winsted. The rent would increase 3% after year two (2) of the initial agreement and every year thereafter. Mareck stated that the city has also asked that legal and engineering fees associated with the review of this request be reimbursed by AT&T. Mochinski asked if the building would be owned by AT & T and would be their responsibility to maintain. Mareck stated yes. Ollig motioned to enter into a lease agreement with AT & T wireless in accordance with the recommendations of the City Attorney and Engineer. Mochinski seconded. Motion carried 5-0. d) 2009 Property and Casualty Insurance Renewal Contract Boelter stated that Flagship Insurance has been working with the city to complete the 2009 Property and Casualty Insurance renewal contract. The League of Minnesota Cities Insurance Trust (LMCIT) has changed the application for the 2009 renewal and there are additional items that require City Council action. The following items were presented by Erin Kutz, Flagship Insurance, for City Council consideration: 1. Liability Insurance Coverage - Waiver Form If the city does not waive the statutory limit, coverage would be for $400,000 on any one claim and no more than $1,200,000 in any one year for all claimants. This is the option selected by most small cities according to the LMCIT. In the past the City of Winsted has taken this option. This would be consistent with the actions of other cities similar in size to Winsted. The other option is to waive the statutory limit and purchase $1,200,000 per occurrence. The cost of that option is 3-?% of the total liability premium for the city. That premium would then be about $900 per year. Most larger cities, including those in the suburbs, take this coverage. 2. No-Fault Sewer Back-up Insurance Coverage The cost to add no-fault sewer back-up insurance is 8-?% of the liability premium or nearly $2,500 per year. The LMCIT agrees that this is expensive coverage and for that reason few cities have this coverage. In consideration of the premium cost, it would make sense for the city to continue self-insuring this risk. 3. Medical Payment Insurance Coverage Medical payment insurance coverage provides a limited amount (a limit of $1,000) of “no-fault” medical payment coverage for those injured on city property. It is questionable whether there is a valid purpose for cities to pay these funds when the city is not legally liable. An argument can be made that these payments can provide a simple and inexpensive way to possibly avoid a more expensive liability claim; therefore, the LMCIT gives cities the option to delete medical payment coverage. Most 7 cities do include medical payment coverage on their liability insurance policy. In the past, the City of Winsted has excluded medical payment coverage. 4. Excess Liability Insurance In the past, the city has purchased $1,000,000 in excess liability coverage. The city has an option to purchase up to $5,000,000 in coverage. Most cities the size of Winsted, have an excess liability coverage of $1,000,000. Kutz stated that If the City Council would decide to add medical payment insurance coverage to the city’s 2009 contract, the cost would be 1% of the liability premium which is approximately $100 per year. The city’s current premium for $1,000,000 of excess liability coverage in $4,925 per year. Kutz made the following recommendations for each of the coverage options listed above: 1. Liability Insurance Coverage – Waiver Form – the City of Winsted does not want to waive the monetary limits on municipal tort liability. 2. No-Fault Sewer Back-Up Insurance Coverage – the city does not want to purchase no-fault sewer back-up insurance coverage. 3. Medical Payment Insurance Coverage – the city does not want to purchase medical payment insurance coverage. 4. Excess Liability Insurance – the city would continue to purchase $1,000,000 in excess liability insurance coverage. Kutz presented information on the city’s liquor liability insurance coverage. Kutz stated that the LMCIT has verified that the city does not have to purchase liquor liability insurance coverage for the Winsted Summer Festival. LMCIT is also recommending that the city do not purchase liquor liability for the Winsted Baseball Association. The LMCIT does not want to cover the Wildcats Baseball team under the city’s policy so Kutz is working with the Winsted Baseball Association to acquire the liquor liability insurance coverage themselves. Eggert gave his legal opinion on each item presented to the City Council. Wiemiller motioned verifying that the City of Winsted does not waive the monetary limits on municipal tort liability established by Minnesota State Statutes 466.04 for the 2009 Property and Casualty insurance contract. Quast seconded. Motion carried 5-0. Ollig motioned verifying that the City of Winsted does not want to purchase No-Fault Sewer Back-Up insurance coverage for the 2009 Property and Casualty insurance contract. Mochinski seconded. Motion carried 5-0. Quast motioned verifying that the City of Winsted does not want to purchase medical payment coverage for the 2009 Property and Casualty insurance contract. Wiemiller seconded. Motion carried 5-0. Mochinski motioned verifying that the City of Winsted wants to purchase $1,000,000 in excess liability coverage. Ollig seconded. Motion carried 5-0. 6) Department Report a) City Engineer Jake Saulsbury, Bolton and Menk, Incorporated reported on the following: Winsted Municipal Airport Improvements Water Supply Plan Grass Lake Road Utility Service 8 Public Works Addition Shady Creek Addition Improvements Miscellaneous Storm Water Issues Pavement Management Plan Don Guggemos, 137 Fairlawn Avenue East, addressed Saulsbury and the City Council regarding the City of Winsted’s Federal Emergency Management Agency’s (FEMA) flood plain map. Guggemos stated that he believes the information on the map is incorrect and recommended that the City Council obtain an estimate for engineering costs to have Bolton and Menk, Incorporated update the information on the map. Saulsbury stated it is difficult to have FEMA agree to amendments to a flood plain map. Saulsbury stated that he will research Guggemos’ request and discuss it with the City Council in the future. 7) No Open Forum. 8) No Announcements. 9) Adjournment Quast motioned to adjourn. Mochinski seconded. Motion carried 5-0. Respectfully submitted, Deborah R. Boelter City Clerk-Treasurer
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