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HomeMy WebLinkAboutSP August 26, 1980 I .- . SPECIAL~ C:tCA~I~~YG~~ 26,1980 AGENDA 1. Call to Order - 7:30 P.M. 2. Agenda Approval 3. Bond Sale - $4,365,000 (1980-3, 1980-4) 4. Xenia Street Repair 5. Expanded Water Service Area - 8:00 P.M. 6. Interview - Kevin Starr - 9:00 P.M. 7. Change Order - Water/Sonsteby 8. Volunteer Fire Department a. Grant Application Approval b. Purchase vehicle/Fire Chief c. Transfer of Budget Funds 9. Personnel Committee a. Cost of Living Increases/January 1 b. Conferences/Seminar Policy 10. 11. 12. 13. Adjournment , ~ 01 ANDOVER SPECIAL CITY COUNCIL MEETING - AUGUST 26, 1980 MINUTES A Special Meeting of the Andover City Council was called to order by Mayor Jerry Windschit1 on August 26, 1980, 7:30 p.m., at the Andover City Hall, 1685 Crosstown Boulevard NW, Anoka, Minnesota. Councilmen present: Jacobson, Lachinski, Ortte1, Peach Councilmen absent: None Also present: TKDA Engineers, John Davidson and Mark Schumacher; City Clerk, P. K. Lindquist; and others AGENDA APPROVAL MOTION by Lachinski, Seconded by Peach, to approve the Agenda as presented. ~lot ion carried unanimously. XENIA STREET REPAIR Ms. Lindquist explained that a contractor building a house on Xenia Street damaged the blacktop shortly after it was put in. Mr. Winner had r~cCrossan Company patch it up, which amounted to a cost of $226.37. Mr. Davidson stated that normal practice is to have the City pay McCrossan and to bill the contractor responsible for the damage. MOTION by Jacobson, Seconded by Ortte1, that we pay C. S. McCrossan, Inc., $226.37 for repa1r to the street at 16242 Xenia Street NW, and that we also have the City Clerk make out a bill for the same amount and send it to whomever it was that did the damage. After discussion, Councilman Jacobson CHANGED motion for the amount that we bill to the firm that did the damage that our bill should be for $226.37 plus any costs incurred by the City. Second stands. Motion carried unanimously. CHANGE ORDER - WATER/SONSTEBY Mr. Davidson explained that Ms. Sonsteby has petitioned to become part of the water service district in the Southwest Area Project. The connecting line is already laid under the road. It is a matter of her extending lateral watermains into her subdivision as part of the presently proposed system. That 17 acres would then count toward the 160 acres of ultimate development. It is feasible to service her with or without the storage tank. Discussion was on the additional cost this would be to the entire project. The Engineers are to make an estimate of the cost for this change order; the item will be discussed again later during the meeting. BOND SALE - $4,365,000 (1980-3, 1980-4 Projects) King Forness of Springsted, Inc., reviewed the following bids that were submitted: John Nuveen and Company for a net interest dollar cost of $5,620,857.50 and for a net interest rate of 9.5422 percent; and First National Bank of St. Paul and co-managers for a net interest dollar cost of $5,287,573.36 and for a net interest rate of 8.97644 percent. Given the market conditions today, Mr. Forness felt that the bid represents their best efforts and, he felt, is realistic for long-term bonds. Discussion was on the market conditions today. Mr. Forness estimated if the entire call is taken, the City is looking at about an effective 8.75 percent rate. Mr. Forness also stated that the City has to demonstrate 105 percent coverage of the bond to provide for delinquent accounts by law; and at these rates, an additional 1 percent for assessment purposes might not cover the issue. For this reason, he suggested the City not make a Special City Council Meeting August 26, 1980 - Minutes Page 2 (Bond Sale - $4.365,000, Continued) commitment on the assessment rate at this time. The Engineers noted that the amount presented at the public hearing was at 8 and 9 percent interest for the assessments. At 10 percent, it would add approximately $40 more annually to an assessment payment. Council also noted that a property owner has the option of paying off an assessment at any time. Mr. Forness explained that the bond issue has a call after the fifth year, requiring the longest bonds to be called first as the City has prepayment monies available to do so. It is a mandatory procedure in the Resolution that in December of each year, the bonds will be called for the amount of balance over what will be needed to meet payments the following year. MOTION by Lachinski, Seconded by Peach, introducing a Resolution authorizing issuance, awarding sale, prescribing of form and details, and providing for the payment of $4,365;000 in General Obligation Improvement Bonds of 1980, Series B as presented by Springsted, Inc., and acknowledge the bids from the firm of John Nuveen with the net interest dollar cost to be $5,620,857.50 and net interest rate of 9.5422 percent and the firm of First National Bank of St. Paul with a net interest dollar cost of $5,287.573.36 and with a net interest rate of 8.97644 percent; and award the bid to First National Bank of St. Paul. (See Resolution R105-80) Motion carried unanimously. Recess at 8:03; reconvene at 8:15 p.m. EXPANDED WATER SERVICE AREA Mr. Davidson reviewed the originally proposed system and costs and the revised water service area with overhead tower and its costs. Larr~ Carlson - asked if his figures are correct that the overhead tower system is at an a ded cost of $200,000. Mr. Davidson agreed, also noting that the storage tank provides added benefit for fire protection, but the question is how quickly will the 360 acres beyond the first 160 acres develop. He also noted that the system originally proposed will be an intrega1 part of the expanded system in the future. It is designed to be affordable at this time using the cost of providing 200 separate wells to the area as a parameter; and there are a number of alternatives to financing. It can be paid for entirely by area charge or partially by user charge. Their figures represent using 60 cents per 1,000 gallons user charge, of which 40 cents would be used for operational expenses and maintenance and 20 cents would be put in a sinking fund for capital replace- ment or expansion. Mayor Windschit1 stated that the net additional cost of the elevated tower over the pressure pneumatic system is $170,000. Mr. Carlson - noted that on May 7 he wrote the City asking to be removed from consideration in the proJect and estimated at that time the proposed water system would amount to approximately $4,500 per home unit. He asked the Engineers what figures they are basing their parameters. Mr. Davidson stated that the figures do not relate the total dollar amount in a particular subdivision; but with most of the private wells in the area being 200 to 280 feet deep, the cost for the central system is comparable to that of individual wells, assuming the going rate for well drilling is $10 to $20 a foot for private wells. Mr. Carlson - stated that the going rate for well drilling is closer to $7.50 to $8.50 per foot; and he estimated a 200-foot well would be approximately $2,500 completely connected to the house. Mayor Windschit1 calculated that with the projected lateral cost for Northg1en of $168,400 and with an area assessment at $860 an acre, which is $42,456, the total cost of $210,906 divided by 121 actual living units in the plat equats to $1,743 per dwelling, which gets it to the property line. Special City Council Meeting August 26, 1980 - Minutes Page 3 (Expanded Water Service Area, Continued) Frank Voth - asked about the price difference between the two pressure systems. Mr. Davidson stated they are talking in terms of the elevated tank, $35,000, in lieu of the pressure system, $180,000. Both the pressure system and the elevated tank would not be needed. The cost difference between the two is $170,000. Mr. Carlson - asked if the per-lot cost determined for the Northglen plat would be 1ncreased if an elevated tank were put in instead. Mr. Schumacher stated in looking at 480 acres, one well, and elevated tank plus oversizing, the per-acre charge would increase by only $10 per acre. Mr. Carlson - questioned the figures in light of the fact that a second well would probably be needed at the time he develops his property. Would he be assessed again for that second well? He is puzzled that he would be assessed for the first well but it could not be used to serve his property. Discussion was that the well would not be needed until the 160 acres is saturated, and then it would be paid for out of the 20 cents/1,OOO gallons user charge. Mr. Davidson suggested outlining the scope of the entire project now so that an area assessment wouldn't be needed for the second well, using either an area assessment or user charge, which would be projected On a population increase of 440 people per year and which would be put into a sinking fUnd to be available at the time the second well is needed. Or a combination of an area assessment initially and a user charge ultimately would be established. Another option is a segmented-type assessment, which would mean those areas that would utilize a second well would be assessed for it when it is constructed. Mr. Voth - asked for the area assessment charge for just the overhead tank. Mayor W1ndsch1t1 ca1cuated that by theoretically recoving the net increase of the overhead storage system of $170,000, it would result in an area assessment of $354/acre for the tank. Mr. Voth - asked if the 160 acres projected that the pressure pneumatic tank system could serve could be increased. How was that number arrived at? Mr. Davidson stated that when 160 acres is saturated, the available 500 gpm flow begins to decrease. It can be expanded beyond that, but there would not be 500 gpm flow. Mr. Voth - stated that Northg 1en and Rademacher's area util i zes approximate 1y. ha 1f of the 160 acres. He asked if the assessment is going to be against a specific 160 acres at this point. He questioned what happens if they are assessed $870/acre for the 160 acres but they are not ready to use the water, then someone else comes in. Would a new developer get to use that water that they have paid against or do they have a vested interest in it? Mayor Windschit1 stated that that problem has already surfaced as Ms. Sonsteby has already petitioned for water for 17 acres. Mr. Voth - had no problem paying the acreage assessment against the land already platted; but he felt that possibly the land across the road should not be charged at this time any more than anyone else is. He didn't want to pay for something any sooner than he had to or pay for something that others will be able to use first. They presently have only an undefined interest for the 80 acres west of Bunker Lake Boulevard with no formal plans to do anyth i ng with it yet. Mr. Davidson explained that the City will have to establish a defined water service area for the proposed water system, but the system is designed to serve the 80 acres west of Round Lake Boulevard. Mr. Voth - asked what figure is used for the number of units per acre in a development. Mayor Windschit1 stated that Northg1en is slightly over 4 housing units per acre, and calculated that an overhead tank system comes to an additional $88 a house over the initially proposed pressure pneumatic tank system. The Engineers stated that their cal- culations are based on approximately 10 persons per acre or 3 housing units per acre. Special City Council Meeting August 26, 1980 - Minutes Page 4 (Expanded Water Service Area, Continued) Mr. Voth - then calculated that 3 housing units per acre times 140 acres equals a dens1ty of 1440 units. At a development of 150 houses a year, which is about the largest number of houses built in Andover in any given year, it would take between 9 and 10 years to saturate the area. He was concerned that the thinking may be too optimistic that this will be completed within 2 or 3 years. There was a lengthy discussion relative to the figures being used in the calculations, questioning whether the $170,000 net difference being used is the correct one; questioning the financing and assessment procedures if the pressure pneumatic tank system is built now and eventually expanded to include an overhead tank; and reviewing the Engineer's recommendation on how the system would be expanded if the pressure pneumatic tank is constructed at this time. Mr. Carlson - stated that if the pressure pneumatic system with two wells could serve an area of 250 acres, that would economically make more sense to him. as he felt 250 acres is not going to be saturated for quite some time. Mr. Davidson also stated that if an elevated tank were put in now, the City would be carrying the financing until the user charges were sufficient to pay for it. It is possible to put in the pressure pneumatic tank system now, accumulate revenue from the user charges and issue revenue bonds to construct the elevated tank when it is needed, which is their proposal for the staged water system. Wayne Anderson - asked how the overhead tank system would affect the timetable for availability of water. Mr. Davidson stated it is their intent that there would be no reduction in the time frame relative to water availability, even if a temporary facility would be needed in the interim. The tank would probably not be built until next fall. Mr. Voth - favored the more conservative route at this time with the pressure pneumatic tank and one well. Mr. Carlson - asked the length of the assessment period (15 years of equal payments) and when it would be levied (payable in 1982, with a 15 percent escrow amount required up front) and when is the breaking point for a third well. Mr. Davidson stated that at saturation, a determination must be made about carrying the feedermain to the east or to put in another tank and well. At the pOint when 250 acres is saturated, an overhead storage system would be constructed. Mr. Davidson stated that economically, the proposed pressure pneumatic tank system is more attractive, but not so regarding fire protection. It is possible to have a ground storage reservoir for some minimal amount of storage. The pressure tank would be a permanent part of any future expansion as a backup only if it is put in initially. A pressure tank would not be installed if an overhead storage tower would be constructed initially. Discussion was then that there is some confusion over the $170,000 net additional cost being used for the overhead tank. The meeting was recessed to allow the Engineers to compute the correct figures. Recess at 9:20; reconvene at 9:37 p.m. Mr. Davidson reviewed his revised calculations: with an overhead tank, two wells, one pumphouse, and one pressure pneumatic tank, $770,000, divided by 480 acres equals $1604 per acre if everything is assessed. With just the overhead tank and one well and oversized piping, $588,800 divided by 250 acres, the point at which an additional well is needed, equals $2,360 per acre. If that is divided over the 480 acres, it equals $l,226/acre at 100 percent assessed. With two wells, one with pressure pneumatic tank and no overhead storage, $318,800, divided by 250 acres of assessable property, equals $1280/acre. The tank, piping, and additional pressure facility would be $700,000 divided by 480 acres, which equals $1460 and which is approximately $260 an acre additional for the pressure facility in the interim. Special City Council Meeting August 26, 1980 - Minutes Page 5 (Expanded Water Service Area, Continued) George Ado1fson - had no comment at this time. He does not have any plans to develop h1S property 1n the near future as he is still farming the land. Council discussion was that since it appears that development over the next five years will not warrant the overhead storage tank at this time, that it would not be feasible to put it in now; that the City should determine what the original water service area should be assessed per acre to take into account the amount to support the total water system so that in the end, all property is treated alike regardless of which order it is developed; that the pressure pneumatic tank system with two wells should service most of that land that may be developed in the foreseeable future; questioned the assessment procedure as to when property is assessed for water service, referencing the Good Value property west of Round Lake Boulevard which is included in the original assessment area but which will not be utilizing the service until such time that it is developed; that once a revenue-producing water facility is established, there are several ways to expand the system for the overhead storage tank; and that at some point when land beyond the 250 acres would be developed, the system would be 600 feet from the undeveloped properties east of Coon Creek in the Bunker Lake Boulevard area, which would quite likely have another water system or elevated storage. Mr. Carlson - preferred the water system of two wells with pressure pneumatic tank to service 250 acres rather than incurring the assessment for the overhead tank now. M~. Voth - assuming the two wells, pressure pneumatic tank, and pumphouse is installed to serve 250 acres at $1280/acre, will they be assessed for the entire thing now? They have signed the development contract and delivered it today. He wondered where these numbers relate. Discussion was that only one well would be constructed at this time; that the Council will need to determine what average rate would be assessed over the area; and that the Council will be making that decision shortly after the bids are received for the project. Mr. Voth - preferred the water system of two wells with pressure pneumatic tank at this time. Council agreed to construct the pressure penumatic tank system, and that decisions will need to be made regarding the number of acres to be assessed initially, the assessment policy for new incoming plats, and the assessment rate. INTERVIEW - KEVIN STARR (Public Works Person) Council asked various questions of Mr. Starr. Mr. Starr stated he had received his Class B driver's license, that he started working in the City On a part-time basis last summer, that his hours are flexible, that he has been driving the dump truck and may be trained to operate the grader, that he lives in Anoka but may try to move into Andover, that he is accepted in the Fire Department contingent upon his acceptance of this position, and that he is willing to do any work that would be required of him. MOTION by Jacobson, Seconded by Ortte1, that we hire Kevin Starr on a permanent basis effective as of 8/25/80 at $4.50 an hour. Motion carried unanimously. CHANGE ORDER - WATER/SONSTEBY, Continued Mr. Davidson stated that based on the previous estimated cost of the water system, it would be approximately $80,000 to serve Ms. Sonsteby's 17 acres with watermains and hydrants. The easements for the sanitary sewer have already been defined. Council agreed to postpone action on the issue until after the bids for the Southwest Area Project are tabulated to determine the actual cost. Special City Council Meeting August 26, 1980 - Minutes Page 6 VOLUNTEER FIRE DEPARTMENT - GRANT APPLICATION APPROVAL MOTION by Peach, Seconded by Lachinski, that the City Clerk be authorized to sign the grant application for breathing apparatus for the Fire Department. Motion carried unanimously. MOTION by Ortte1, Seconded by Lachinski, that we approve Claim Number 3349 in the amount of $1,999.98 to Minnesota Fire, Inc.. Motion carried unanimously. VOLUNTEER FIRE DEPARTMENT - PURCHASE VEHICLE/FIRE CHIEF Assistant Fire Chief Tom May stated they have looked at the vehicle and drove it Saturday morning and talked with the person who had the vehicle for the last 6,000 miles. Fire Chief Bob Palmer explained that the vehicle is a 1977 Ram Charger Dodge, 4-whee1 drive, v-a engine, for sale at $1,000 with 99,000 miles on it. Insurance will be between $300 and $350 a year for liability only. They have a firm estimate for a radio installed at $1,000; however, that would not have to be done at this time, as the Chief can continue to use his portable hand-held radio until funds are available. Council discussion was on the vehicle itself and on the use of it. Councilman Ortte1 felt that it was a lot of money for the number of miles on it. He was afraid of the maintenance problems that may occur on it as well. Chief Palmer estimated he puts on 5100 miles a year on his own car for Fire Department purposes. He intends to keep the vehicle at his house so that he can respond directly to fires. He also asked if it would be possible to drive it to and from work in Anoka as he responds to fires during those times as well. Mayor Windschit1 questioned whether the Chief should be taking a City Vehicle out of the City. He felt the City would come under a lot of criticism if a City vehicle were allowed to sit in a parking lot outside the City all day, and he didn't think it was a reasonable thing to do. Councilman Lachinski felt that it would not be a problem since Chief Palmer works in Anoka, but felt there probably would be if he would transfer to a suburb farther away. Councilman Ortte1 questioned the insurance rating of the vehicle if Chief Palmer were allowed to drive it to and from work. Chief Palmer stated that he would be willing to reimburse the City for personal mileage on the vehicle and he would be willing to keep mileage sheets as to where and how it is being used. He also stated that the County may be agreeable to defer billing until after the first of the year. He also felt the $1,000 grant the Department will be receiving could be put toward this vehicle. Discussion was on the amount of money remaining in the Fire Department Capital Improvements budget for 1980. Fire Chief Palmer also stated that he was not aware that the bill for the transmission repair, amounting to $1120, was not paid. In reviewing the budget, he felt that there would be excess funds from the Staff Employee account. Councilman Peach felt that professionally speaking, it is essential that the Chief be provided a vehicle. Whether or not the Chief can use the car to and from work or to charge him for it, is largely incidental to him. Councilman Jacobson was not opposed to purchasing the vehicle if the $1,000 is to come out of this year's budget. MOTION by Peach, Seconded by Lachinski, that the Council authorize $1,000 for the purchase of a County 4-whee1 drive for the Fire Chief. Councilman Peach AMENDED MOTION that the vehicle is to remain within the City limits except in the case of emergency or specific approval of the Council. Amendment dies for lack of a second. DISCUSSION: Mayor Windschit1 stated that the vehicle is very expensive to run, especially to meetings and made a recommendation to equip one of the existing City vehicles with safety equipment to be used as the Chief's car after hours. Some Councilmen expressed the opinion that the use of the vehicle outside City limits · ' Special City Council Meeting August 26, 1980 - Minutes Page 7 (AVFD - Purchase Vehicle/Fire Chief, Continued) should not be made a contingency for purchasing the vehicle but that a policy on the matter should be established at some point. Vote on the motion was held to get a clarification of the amount remaining in the Fire Department budget. MOTION by Ortte1, Seconded by Jacobson, that Fire Department be authorized to transfer $1, 120 from Salaries fund to pay for the repairs on the 6-whee1 drive fire vehicle. Motion carried unanimously. Discussion continued on the purchase of the vehicle for the Fire Chief. It was determined that approximately $1,240 would be in the account after receiving the grant mOney from the State and after purchasing the breathing apparatus and compressor. It was also noted that lights, radio. mileage, and insurance will be extra and will need to be budgeted for 1981. VOTE ON MOTION AUTHORIZING PURCHASE OF VEHICLE: YES-Jacobson, Lachinski, Peach; NO-Ortte1, Windschit1. Motion carried. Councilman Ortte1 - I think it is too much money to pay for that type of vehicle with that many miles on it. There are cheaper ones available. Mayor Windschit1 - I would like to know the ultimate use of the vehicle before I would be in favor of purchasing it. Discussion was on where the money should come from. MOTION by Peach, Seconded by Lachinski, to direct the City Clerk to request the County to defer the billing of the vehicle until January 1, 1981. DISCUSSION: the reason for the deferment is to insure that the City has the grant funds from the State in hand. Also, insurance money will be needed for the remainder of 1980. Motion carried unanimously. (Councilman Peach left the meeting at this time - 11:10 p.m.) Mayor Windschit1 asked the Council to give some thought to the City making an additional contribution to the Relief Association for those fire fighters who joined the Department when it first began for the first and possibly second years. He estimated it would be approximately $500 per person per year and would be a reward to those first people who put their time and effort into organizing the Department. It would also then equalize payments for the length of service for all fire fighters. PERSONNEL COMMITTEE - COST OF LIVING INCREASES/JANUARY 1, 1981 Councilman Jacobson stated that it is the Personnel Committee's recommendation that cost of living increases for all City employees be based on 60 percent of the CPI-U Minneapolis Urban Consumer Index, which is approximately 7 percent. Merit raises would be on top of that. Councilman Lachinski didn't agree with the concept of basing it on a particular index. His concern was the final outcome of an employee's salary and wanted to know what percentage the surrounding cities are using. He suggested granting a 7 percent cost of living increase for everybody and anything above that would be for outstanding performance. Mayor Windschitl had no objection to 7 percent, or possibly somewhat more; but he didn't feel it should be used across the board. He felt that those employees hired during the year should get a percentage of the increase based on the number of months worked during the year. He also felt that monies should be made available to give performance raises. Special City Council Meet1ng August 26, 1980 - Minutes Page 8 (Personnel Committee - Cost of Living Increases, Continued) (Councilman Peach returned to the meeting - 11:24 p.m.) Discussion continued on the pros and cons of the Perosnne1 Committee's recommendation, with various other suggestions for determining salary increases made by Councilmembers. MOTION by Jacobson, Seconded by Peach, that we adopt the Consumer Price Index - U, which is the Minneapolis Urban Consumer Index and that we set the salary increases in the coming year at 60 percent of that Consumer Index based on the most current Index. DISCUSS ION : Councilman Jacobson stated that this is the formula that will be used to determine cost of living increases. The Clerk would determine a merit increase as well for a figure to be used in the budget. Mayor Windschit1 felt a simple percentage would be the best method rather than using the CPI. He also was concerned on how the salary increases would affect the 1981 budget. VOTE ON MOTION: YES-Jacobson, Ortte1, Peach; NO-Lachinski, Windschitl Motion carried. MOTION by Ortte1, Seconded by Peach, that the Urban Consumer Price Index figure that is used times 60 percent will be paid on the basis of 1/12 of that amount for each month worked in the previous calendar year. VOTE ON MOTION: YES-Jacobson, Ortte1, Peach; NO-Lachinski, Windschitl Motion carried unanimously. Mayor Windschit1 - I agree with the idea of pro-rating an increase, but I disagree with using of an index. CONFERENCES/SEMINAR POLICY Councilman Ortte1 stated that previous Council discussions were that for major conventions, employees would be allowed to attend one every three years, that one being the closest to the City in that time period. Given the reduction in City revenues, the Council agreed to budget $1,000 for conferences and travel; and if that money can be kept in the budget after going through the budget cuts, a resume must be submitted of what is expected to be accomplished at a particular function prior to approval. MOTION by Peach, Seconded by Ortte1, to adjourn. Motion carried unanimously. Meeting adjourned at 11:43 p.m. Respectfully submitted, \~~/L Mar e11a A. Peach Recording Secretary