The URL can be used to link to this page

2015-06-29 Council Workshop PacketCITYOF MENDOTAHEIGHTS CITYCOUNCILWORKSHOP AGENDA Monday,June 29,2015–1:00pm MendotaHeightsCityHall 1. Call toOrder/Roll Call 2. Broadband Discussion/Technology Use Policy 3. St. Paul Regional Water Contract Discussion 4. Pilot Knob Location / Dog Park Funding 5. Village Lots Discussion 6. Legislative Platform 7. Other 8. Adjourn page 2 2. To: Mayor and City Council From: Mark McNeill, City Administrator Subject: Broadband Discussion Continuation Date:June 29, 2015 Comment: th , Dakota County CDA Consultant and former Burnsville City At the Council workshop of June 29 Manager Craig Ebeling will continue the discussion which he began at the City Council meeting of April 21. Mr. Ebeling will update the Council on progress which has been made regarding the establishment of a Joint Powers Agreement which would continue the work on the provision of broadband dark fiber to Dakota County communities. Attached are three reports: A Process Diagram for a possible Joint Powers Agreement. A summary report of an extensive study of the feasibility of Broadband in Dakota County An one page “executive study” of the summary report Mark McNeill City Administrator page 3 Dakota County Broadband Report Summary Dakota County public institution, resident, and business needs for broadband will increase rapidly. Dakota County needs modern next generation broadband to deliver high quality services and compete globally. The CDA on behalf of the Dakota County Managers Group hired Design Nine to complete a study addressing the following key concepts: Institutional Network (I-Net) – Link existing publicly owned network assets to provide better and more cost effective service for governmental operations. Commercial Network (C-Net) – Use excess capacity of the I-Net to enhance economic development. Report Recommendations 1.Invest in an enhanced I-Net. Benefitsof an enhanced I-Net would include: a.More efficient operation and utilization of existing assets b.Improved management and inventory of network assets c.Better planning and implementation of future network additions (the current ad hoc approach to brokering individual JPAs is unsustainable) d.Streamlined ability to broker asset and cost sharing agreements e.Increased opportunities for shared procurement of network services 2.Create a Joint Powers Agreement (JPA) to operate the I-Net (and the C-Net if it follows) a.Complete a comprehensive inventory of all existing and planned publicly owned network assets b.Analyze all existing JPAs to understand restrictions on the use of the assets c.Create pre-approved operating procedures for the I-Net d.Connect the disparate systems (County and city owned fiber networks) by completing the “gaps” project. This could be done in two phases for a total estimated cost of $3.4 million. 3.An enhanced I-Net is recommended to better and more cost effectively manage the I-Net for governmental purposes, irrespective of whether a C-Net follows. The report also strongly recommends the establishment of the C-Net as a wholesale-open access-multiservice system, using the excess capacity of the I-Net. Under this model, the C-Net would NOTcompete with private providers. It would make network assets available to private providers on an equal basis, decreasing their costs and increasing competition. The result would be faster, cheaper service for businesses and residents. Benefits of the C-Net would include: a.Better position Dakota County to be economically competitive in the global marketplace b.Make it more likely that private providers would invest in the last mile to make Fiber to the Home/Premise a reality for Dakota County residents and businesses c.Revenue generated could be used to reimburse public investment page 4 Overview of the Broadband Infrastructure Study Dakota County, MN January, 2015 DRAFT: Do Not Distribute DESIGN NINE broadband planners page 5 Copyright © 2015 Design Nine, Inc. Provided for the exclusive use of the Dakota County CDA. All other rights reserved. Disclaimer e telecommunications business is continually evolving. We have made our best eort to apply our experience and knowledge to the business and technical information contained herein. We believe the data we have presented at this point in time to be accurate and to be representative of the current state of the telecommunications industry. Market changes and new technology breakthroughs may aect our recommendations over time. Design Nine, Inc. presents this information solely for planning purposes. is document is not intended to be a replacement for formal engineering studies that are normally required to implement a telecommunications infrastructure. No warranty as to the Ðtness of this information for any particular building, network, or system is expressed or implied. Design Nine, Inc. will not be responsible for the misuse or misapplication of this information. For more information: www.designnine.com page 6 Table of Contents Overview and Recommendations .................................................1 Where is the private sector?...............................................................................2 Current Goals and Activities in Dakota County..................................................3 Recommendations.............................................................................................6 Next Steps.........................................................................................................7 Bandwidth and Capacity Analysis .................................................9 What is Broadband?...........................................................................................9 Next Generation Connectivity..........................................................................11 I-Net and C-Net Analysis ...............................................................13 I-Net BeneÐts and Eciencies.........................................................................13 C-Net BeneÐts and Economic Impact.............................................................14 Business Models and Ownership ..................................................16 The Public/Private Partnership.........................................................................18 Business Model Options..................................................................................18 Financing Options ..........................................................................20 Project Phases .................................................................................22 Infrastructure Maps ........................................................................23 page 7 Overview and Recommendations In the autumn of 2013, Dakota County, its cities and the Dakota County Community Development Agency (CDA) solicited assistance in the advancement of their broadband vision adopted through the eorts of the High Percentage Partnerships (HiPP) process. A detailed Request for Proposals (RFP) was issued. e CDA and its partners desired to better understand what sorts of system improvements would be necessary to link designated public facilities in the County with broadband capabilities. Many of these facilities were already served by Ðber optic cable owned by the County and its cities, but it was thought that some gaps may exist. e envisioned I-Net would be a system that links and serves these public sites with a system that utilizes existing publicly owned communication facilities including Ðber optic cables, and necessary additions to that system to allow that service. In addition to increasing the eciencies of local government services, the broadband objectives adopted through the HiPP process include the enhancement of economic development opportunities, growing home-based businesses, and maintaining increases in residential home values. To this end the RFP also asked for an analysis of potential expansions of the I-Net to provide a system that would be of value for outside private entities, referred to as the C-Net, potentially including businesses, wholesalers and/or Internet Service Provider (ISP)/content providers. e thought was that there could be an economic development impact of the C-Net concept - new business creation, strengthening and expanding of existing businesses, education, healthcare, and entertainment and other residential uses including telecommuting. Design Nine was selected through the RFP process to complete the work and began on May1, 2014. e following report addresses the RFP requests. Why Fiber? We are now seeing even small and medium-sized businesses asking for Ðber connections. Without ubiquitous Ðber infrastructure, communities will not be economically competitive. Communities that already worry about losing too many young people to other areas have much more to worry about. Fiber is the only transmission system that will be able to deliver all the services businesses and residents will expect and demand in just a few years. Communities that choose to delay Ðber infrastructure investments will be at a severe disadvantage in the next several years when trying to attract and retain businesses and workers. Fiber is a future proof investment. e upper limit of Ðber capacity has not yet been found, and o the shelf hardware can handle thousands of times the needs of an average home or business well into the future. Fiber has a life expectancy of thirty to forty years, and may last much longer than that; every year, the number goes up as Ðber systems installed in the 1970s continue to perform adequately. A single Ðber can carry all the Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 8 trac and services needed by a home or business, including voice telephone service, television programming, live videoconferencing, and HD television. Over the next thirty years, the businesses, residents, and institutions of Dakota County will spend more than 10 billion dollars on telecommunications services--in todayÈs dollars, unadjusted for inÑation and unadjusted for price increases. Some analysts believe that the average household bill for services delivered via broadband may double in the next ten years, which would make the thirty year projection easily reach 14 billion dollars (see the table on the following page). Clearly Dakota County sees the value of good telecommunication services. Numerous studies indicate that the demand for bandwidth is doubling every two years. Are the increasing telecommunications needs of Dakota County public institutions, businesses and residents being adequately met in the most cost- eective manner possible? is study concludes that they are not and Ðnds that government actions could be employed to promote enhanced broadband service. Dakota County 30 Year Telecom Expenditure AnalysisDakota County 30 Year Telecom Expenditure AnalysisDakota County 30 Year Telecom Expenditure AnalysisDakota County 30 Year Telecom Expenditure Analysis Households still on Households with Households with no dial-upÅlittleÆ broadband cable Internet modem/DSL/wireless Total households 156,641 Total businesses 14,096 Household 3%82%15% Percentage Number of 4,699128,44623,496 households Average monthly Local phone: $25Local phone: $25Local phone: $25 telecom Long distance: $25Long distance: $25Long distance: $25 expenditures Cable/satellite TV: $65Cable/satellite TV: $75Cable/satellite TV: $65 Dial up Internet: $20Broadband Internet: $45 Annual cost/ $1,620$2,040$1,380 household 30 year $228,382,578$7,860,871,944$972,740,610 expenditure Total residential $9,061,995,132 expenditures Total $10,421,294,402 expenditures 1: Includes an estimate of both local government and business expenditures. Where is the private sector? One might reasonably ask if there is so much money being spent on telecommunications, where is the private sector? e core issue applies not just in Dakota County, but Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 9 nationwide: the incumbent business model is broken. TV and telephone services are low margin commodity services that are rapidly being supplanted by Over e Top (OTT) video services like NetÑix and Hulu, and cellphones have made the traditional telephone landline a luxury. Incumbents view the market for telecom as a Ðxed, static market that requires them to ÅownÆ the customer and to bundle all services with the physical infrastructure. Put another way, the incumbents do not have a business model that supports revenue growth in a meaningful way, and without revenue growth, they cannot aord to make substantial capital improvements (e.g. Ðber). ÅBroadbandÆ is not a service--it is a delivery medium. If we think about broadband using a roads analogy, broadband is the road, not the trucks that use the road. Internet access is a service delivered by a broadband road system, and that Internet service is just one of many services that are in demand. Today, congestion on broadband networks is not due just to increased use of email and Web surÐng, but many other services. From an economic development perspective, the incumbent reliance on an outdated business model is disastrous. Local businesses should not be punished for using too much of an essential business service. An apt analogy would be if the Department of Transportation told a businesses that the tractor trailers they were using were Åtoo bigÆ and henceforth all deliveries had to be made by pick up truck. We know intuitively that this would make the business uncompetitive with businesses in other regions that had roads that supported tractor trailers. Current Goals and Activities in Dakota County During the course of this study numerous interviews were conducted with Dakota County, municipal and school district ocials. A common theme discussed in these interviews was the desire to apply a more strategic focus to the design and installation of any new publicly owned broadband assets and also to the application of the already well- endowed existing broadband assets. Substantial conduit and Ðber assets have already been installed by Dakota County and its cities for institutional use. Over the years this eort has given Dakota County and its cities with an inventory of valuable Ðber optic cabling that could potentially be more eectively applied to serving the governments of the County and assisting economic development, if the recommended steps are undertaken. Dakota County now publishes all broadband communications projects, including Ðber- optic cabling installation, in its capital improvement program (CIP). is action allows broadband communications projects to be viewed and evaluated on par with other strategic capital improvement projects such as roadways, parks, and building construction. County policies stress appropriate redundancy, building to proper construction standards including strong adherence to the Ådig-onceÆ strategy, and serving all the county facilities that need broadband access. e County believes that the formal inclusion of broadband projects in the CIP, and the public visibility this inclusion imparts, will point to even more Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 10 potentially fruitful partnerships with other governments and private entities. e county is seeking a steady and orderly process for completing its network. Apple Valley has partnered with Dakota County, AccessEagan, Burnsville and Independent School District (ISD) 196 to connect ten buildings to a Ðber network within the city. e Apple Valley City Hall functions as the network center for the hub and spoke network design. Empty conduit has been placed along Cedar Avenue which will provide future expansion of the Ðber network in this heavily concentrated industrial area in what is otherwise a largely residential municipality. Farmington owns ten to twelve miles of Ðber which connects several municipal buildings. Farmington relies on its own internal Ðber system to connect its buildings and does not contract with Charter or any other cable provider for data, but does contract with Charter for video services. Lakeville, however, relies almost entirely on leased Ðber from Charter which services all the municipal connected facilities. e city does own a few short strands connecting the city hall, library and a municipal liquor store. e city also shares some Ðber with ISD 194 and gets internet service through State of Minnesota connections at the Western Service Center. Rosemount currently owns Ðber connections between the city hall and the Ðre station. e city is seeking to expand connections to its oce park and to portions of the Dakota County network. e only active Ðber-to-the-home (FTTH) project in the county, Evermoor, is in Rosemount. Despite mixed Ðnancial results from this project, Rosemount sees the potential for economic development with FTTH. A common theme expressed during our interviews with key city ocials was that ÅÐber to the premisesÆ (FTTP) Ã direct Ðber connections to homes and business Ã is a goal of broadband expansion for the municipalities. FTTP is viewed as a key strategic driver for economic development. Fiber to the home has measurable beneÐts to homeowners beyond improved Internet access: In a 2013 report to the Fiber To e Home Council, Render Research and Consulting reported that Ðber to the premises adds $5000 to $6000 to the sales price of the house. It was undecided how the goal of Fiber To e Premises would be achieved, but the cities of Burnsville and Eagan illustrate two possible approaches. Burnsville and Eagan have both constructed advanced municipal Ðber networks, although with slightly diering approaches. In Dakota County, it is likely that private initiatives will lead Ðber to the home eorts (new business models being adopted by FTTH start ups and larger Ðrms like Google are showing that FTTH/FTTP eorts can be proÐtable). However, a well-designed and maintained C-Net could accelerate private investment by reducing the cost of connecting several neighborhood-level FTTH projects together. e C-Net would also make it easier Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 11 for FTTH projects to bring competitive service providers into their FTTH neighborhoods. While Burnsville and Eagan have made a commitment to allow business to access their broadband networks and create a commercial network, or C-Net, Dakota County and its other municipalities have made broadband investments almost exclusively to support government operations. is institutional network, the I-Net, has successfully linked county administrative buildings and other facilities, city halls, Ðre departments, schools, trac lights, emergency response facilities, golf courses and municipal liquor stores. Dakota County has focused on the I-Net. e the County's priority has been to develop Ðber routes to meet the needs for performing its responsibilities and its partner local governments. Still, one of the CountyÈs strategic plan goals is to be Ågood for businessÆ, including being the best at the basics (transit, Ðber, roads etc.). In addition, one of the Dakota County CDAÈs strategic goals is to support the economic development goals of Dakota County communities. A strong broadband network is a cornerstone of economic development. Dakota County is well known for its governmental collaboration success. e Dakota Communications Center (DCC) organization is an example of shared services and network sharing that has been in operation since 2007. Dakota County and several other cities in the County belong to LOGIS, which is a Joint Powers, intergovernmental consortium of Minnesota local government units. e mission of LOGIS is to ÅFacilitate leading-edge, eective and adaptable public sector technology solutions through the sharing of ideas, risks, and resources in a member-driven consortium.Æ To further extend its collaboration eort, Dakota County is Ðnalizing an agreement with the Technology and Information Education Services (TIES) group. TIES is the largest provider of educational technology professional development in the Midwest, oering management software for school operations, instructional administration, and information technology operations. Most of the County network is owned by the County, but the state of Minnesota provides the Internet services. is is true of several of the cities in the county as well. e broadband policy for the County is to procure fewer commercially leased Ðber lines and emphasize the construction and use of cooperatively constructed facilities with other institutions. e partnerships with the State have been advantageous to both parties. It seems that the State has more ability to obtain operational cost funds but struggles to fund capital expenditures. e County has been able to Ðll this need on several occasions. Beyond Apple Valley, Burnsville and Eagan there is little municipal-owned Ðber in the other cities involved in this study (Farmington, Hastings, Inver Grove Heights, Lakeville, Mendota Heights, Rosemount, West St. Paul, and South St. Paul). Most of the other municipalities have leased Ðber directly from a commercial provider, such as Comcast or Charter, or have joined a consortium, such as NDC4 in the northern part of the county. NDC4 connects Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 12 41 facilities in 13 entities, including 4 cities, 3 school districts, county libraries, 1 private school, and the South St Paul Library. e cities of Mendota Heights, South St. Paul, West St Paul, and Inver Grove Heights subscribe to NDC4 services. e above mentioned County-TIES partnership will be a valuable ÅhedgeÆ against future unknowns when NDC4 concludes its cable franchise renewal agreement. In addition to economic development, the interviewed city and county ocials were concerned with network availability and redundancy. All have expressed interest in some sort of county-wide consortium that would reliably and eectively link county governments with a high-speed network. ey recognize that establishing an entity to accomplish this task will be dicult, but they are all interested in participating, under the right conditions. Additional information about activities in the county and the cities is contained in a separate document called Maps, Cost Estimates, and Notes. Recommendations e decisions surrounding an I-Net and a C-Net can be completely decoupled, and we suggest that the decision to support a C-Net project could be set aside until an enhanced I-Net has been established and funded. We strongly recommend the following: One: We recommend that an enhanced countywide I-Net eort be undertaken and cite the following as some of the reasons: (ese factors are discussed in more detail in the body of the report.) e current ad hoc approach to brokering individual JPAs (now numbering more than 100 for the County) is unsustainable. Current and future Ðber and network assets are going to be under-used because there is no process in place to make good use of unallocated conduit and Ðber. As bandwidth demands continue to increase just for local government needs, the sheer number of literally disconnected Ðber assets will not be able to be utilized eciently. e current tools being used to manage Ðber strands is inadequate. e long time period required to get new joint Ðber sharing and/or joint construction cost sharing agreements in place will only get worse, meaning some opportunities to save money or improve services will be missed. Once an enhanced I-Net has been formed to address the existing I-Net only problems, it will be much easier to make a decision about whether to create a C-Net. In fact, we would say that developing a C-Net using existing County and city assets is simply not possible unless the current I-Net asset and process problems are solved. Two: We recommend that the I-Net (and the C-Net if it follows) be implemented utilizing the wholesale-open access-multi-service business model, owned and governed by Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 13 a joint powers agreement (JPA) entity. e various business model options are discussed at length in this report. e recommended structure would provide for a JPA entity that would own and manage all publicly owned telecommunications assets in the County. It would assist all governmental units in required additions to the system to serve their facilities and manage and maintain all of the systems. It would devise fair and equitable policies regarding the compensation for assets owned by the various members of the JPA and would expeditiously oversee the operation of the C-Net should the County and its cities determine to implement that concept. ree: Making this concept a reality will require a great deal of eort and cooperation among the County and its cities, something that they have demonstrated an ability to do in numerous instances before. e following ree Step Approach is recommended for this concept implementation. Next Steps Step One Create a new JPA entity with a charter to manage Ðber and network assets on behalf of the County and any other cities that choose to join. is process will likely take three to six months, including time needed for individual city votes to join. Joining the JPA should require a minimum funding commitment to pay for sta, oce space, and other operational expenses (shared among all members). e JPA would have the legal authority to take on management of a C-Net at some time in the future. e JPA could be staed minimally with a project manager and a network engineer, and most other activities could be outsourced. Where assets are owned by the County or a city, the JPA would be authorized to manage those assets and negotiate use of those assets with appropriate oversight. Where revenue is generated from leasing of those assets, there would be a pre-existing revenue share agreement in place between the JPA and the asset owner (e.g. if the JPA negotiates a fee- based lease of dark Ðber in Burnsville, the City of Burnsville would share in the revenue). e JPA would require appropriate oversight and direction, and the JPA charter would specify a board, periodic meetings, Ðscal oversight, and other organizational and management requirements. Step Two e two new sta would be hired/transferred to the JPA (Director/Manager, Senior Technical position). First tasks would include: Development of a comprehensive and accurate inventory of existing and planned assets, map Ðber strand assignments based on existing and proposed Ðber use JPAs and any other shared use agreements (this would have to be contracted out--itÈs a substantial work eort). Likely time for this eort is Ðve to seven months. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 14 Analysis of all existing JPA joint use agreements and development of accurate records of partners, terms, restrictions on use, and other pertinent restrictions or requirements in the agreements. Creation of new uniform ÅstandardÆ agreements for joint use, Ðber sharing (e.g. IRUs) and construction cost sharing so that new opportunities could be negotiated more quickly and at less expense. For all new Ðber projects proposed by JPA members or partners, the JPA would be authorized to negotiate agreements using a ÅstandardÆ Ðber lease agreement developed and reviewed by telecom counsel on retainer (i.e. not local government attorneys). JPA sta would coordinate new Ðber use and Ðber deployment projects among JPA local government members, state agencies, school systems and other partners. Step Three After JPA is formed and asset inventory work is well underway, a separate proposal would be made to the JPA members to create a C-Net, using some of the now clearly identiÐed Ðber assets that could be allocated to the C-Net. e C-Net should be operated on an open access wholesale basis; the customers of the C-Net would be private sector service providers. We do not recommend that the JPA oer any retail business or residential services (i.e. Internet, voice telephony, TV, etc.). e C-Net could be operated directly out of the JPA, or a separate LLC could be formed (pending legal opinion on best way to do this). If the JPA members agree to create a C- Net, the JPA would develop a public price list for various assets (e.g. conduit lease, dark Ðber lease, lit circuit leasing) and begin marketing availability. Likely time to reach agreement on C-Net formation and readiness to begin marketing: four to six months. Planning and implementation of the C-Net would require additional resources during the planning and development period. e C-Net network could begin as a nucleus of existing assets, but would require some capital funding to create a ÅPhase OneÆ business class core network. To be successful, the C-Net planning would have to include a careful analysis of current and planned areas of economic growth, and new Ðber construction would be needed in many cases, as existing Ðber assets have been placed in many cases to support local government activities rather than business activities. T Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 15 Bandwidth and Capacity Analysis What is Broadband? ere is much confusion about the ÅtrueÆ deÐnition of broadband. From the perspective of economic development, there can be no upper limit on the deÐnition of broadband. Saying that broadband (as an example) is 5 megabits/second of bandwidth or 10 megabits/ second is to immediately tell businesses in the region that there will be structural limits on their ability to do business in the futureÃit is dictating the size of truck that can be used to deliver goods and services. Here is the only appropriate deÐnition of broadband: Broadband is whatever amount of bandwidth is needed to support a businessÈ ability to compete in the global economy. Broadband is a community and economic development issue, not a technology issue. e essential question is not, ÅWhat system should we buy?Æ or ÅIs wireless better or cheaper than Ðber?Æ Instead, the question is: ÅWhat do our businesses and residents need to be able to compete globally over the next thirty years?Æ In short, the County today has some Ålittle broadbandÆ in the form of DSL and cable modem service, along with a very limited amount of Åbig broadbandÆ in the form of Ðber to a few businesses and institutions. If Dakota County is to make investments in broadband and telecommunications infrastructure, it is absolutely critical that those investments are able to scale gracefully to meet business and economic development needs for decades. is drives the solution towards an integrated Ðber and wireless system, rather than a wireless only service orientation. Wireless is able to provide basic Internet access needs, but is not able to support advanced video and multimedia services. Some o the shelf business videoconferencing systems in use today require a minimum of 50 megabits of bandwidth-- far beyond the capabilities of any wireless system. Two key concepts that should drive community investments in telecom are: ÅBroadbandÆ is not the Internet Bandwidth is not a Ðxed number Broadband and Åthe InternetÆ are often used interchangeably, but this has led to much confusion. Broadband refers to a delivery system, while Åthe InternetÆ is just one of many services that can be carried on a broadband network. e challenge for communities is to ensure that businesses and homes have a broadband network with sucient bandwidth to deliver all the services that will be needed and expected within the next three to four years, including but not limited to Åthe Internet.Æ Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 16 Bandwidth needs for the past decade have been growing by 25% to 50% per year, and show no sign of slowing. As computers and associated hardware (e.g. video cameras, audio equipment, VoIP phones) become more powerful and less expensive, new applications and services are continually emerging that drive demand for more bandwidth. e table below indicates the likely growth in bandwidth, based on current uses, emerging high end equipment, and research lab/university/government networks already deployed and in use. Lightpaths refer to placing multiple wavelengths (paths) of light on a single Ðber. High end commercial equipment already in production is routinely placing 20+ lightpaths on a single Ðber, with each lightpath capable of carrying data at gigabit speeds. is technology will move down to ordinary business and residential network equipment over the next ten to Ðfteen years. Current Ðber being installed will require only a relatively inexpensive equipment upgrade to increase carrying capacity over the same Ðbers. From a report by the Information Technology and Innovation Foundation (March, 2009), listed below are the bandwidth requirements for services already commonly in use and for emerging services like telepresence business videoconferencing. Upstream Downstream Total Combined Application/ Bandwidth Bandwidth Bandwidth Service RequirementRequirementRequired 1.2 megabits1.2 megabits2.4 megabits Medium resolution videoconferencing .5 megabits1.2 megabits1.7 megabits Streaming video (720p) .25 megabits4 megabits4.25 megabits Standard deÐnition TV 1.2 to 4 1.2 to 4 megabits2 to 8 megabits Basic HD megabits videoconferencing (720p) 5 megabits5 megabits10 megabits for 2 Telepresence high attendees, 15 meg resolution HD videoconferencing for 3 attendees 2-5 megabits.5 megabits2.5 to 5 megabits Video home security service 1 megabit4-8 megabits5 to 10 megabits HD digital television (1080p) 15 megabits15 megabits30 megabits for 2 Telepresence very attendees, 45 high resolution HD videoconferencing megabits for 3 (1080p) attendees 1 megabit19 megabits20 megabits 4K digital television Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 17 Note that the business videoconferencing services all require symmetric bandwidth. is is a critically important issue, as current incumbent Ålittle broadbandÆ services like DSL and cable modem systems do not oer symmetric bandwidth (where the upstream and downstream bandwidth is equal). Using this information we can project what Dakota County homes and businesses will need in the coming years. Next 2-4 Next decadeTwenty years years 10-25 megabits of 100 megabits of Gigabit+ symmetric Small business symmetric symmetric bandwidth and 50 to 100 needs (1-9 bandwidth and 5-10 bandwidth and megabits of Internet employees) megabits of Internet 20-40 megabits of access accessInternet access 50-100 megabits of Gigabit symmetric Multiple gigabit Medium-sized symmetric bandwidth and 50 symmetric circuits and business needs bandwidth and to 100 megabits of lightpaths and 100+ (10-100 10-20 megabits of Internet accessmegabits of Internet employees) Internet accessaccess Gigabit and Multiple gigabit Multiple gigabit Large business 10Gigabit symmetric symmetric circuits and needs symmetric connections and lightpaths and 1 Gigabit (100-1000+ bandwidth and 250 to 500 + of Internet access employees) 100+ megabits of megabits of Internet accessInternet access 25-50 megabits of A Gigabit of A Gigabit symmetric Residential symmetric asymmetric or circuit and/or lightpaths, needs bandwidth and symmetric with 100 to 250 10-15 megabits of bandwidth and megabits of Internet Internet access80-100 megabits of access Internet access Next Generation Connectivity ÅNext generationÆ is the term used to describe future planning for the next step in network connectivity and infrastructure. ere seems to be an emphasis on deploying Ðber-to-the- home (FTTH). But why? By pulling Ðber deeper into the neighborhood and providing greater access to connectivity, this allows the infrastructure to be in place to accommodate future communication needs, capacities, and innovations. Because of the U.S. demographic bulge that occurred during the baby boom after WW2 caused exurban migration, the U.S. is currently the only country where Ðber is being deployed in largely suburban areas with single family homes. In countries like Japan and Korea, Ðber to the apartment is widely available, in part because the cost of delivering Ðber to a high rise apartment building that might have 500 subscribers is much lower than the build cost of Ðber to 500 single family homes in a sub-division. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 18 Next generation broadband reaps substantial beneÐts; there are several key beneÐts of ÅNext-Generation BroadbandÆ: Dramatically faster Ðle transfer speeds for both uploads and downloads e ability to transmit streaming video, transforming the Internet into a far more visual medium Means to engage in true-real time collaboration e ability to use many applications simultaneously Ability to maintain more Ñexible work schedules by being able to work from home on a part time or full time basis e ability to obtain health-related services for an occasional illness and/or long term medical services for chronic illnesses. Clearly, consumers have a strong interest in a visual medium from whenever and wherever they are. YouTube is the second most popular search engine after Google, which demonstrates the need to support the infrastructure to transmit streaming video. In addition to video streaming, true-real time collaboration also provides an eective way for people to interact from wherever they are. People can engage in a two-way, real-time collaboration, so that fruitful, visual conversations can be held between friends, family, business associates from the state, country, or internationally. Because of Ðber networks, employees have the capabilities of working from their home. Findings suggest that if all Americans had Ðber to the home, this would lead to a 5 percent reduction in gasoline use, a 4 percent reduction in carbon dioxide emissions, $5 billion in lower road expenditures, and 1.5 billion commute hours recaptured. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 19 I-Net and C-Net Analysis e potential county-wide I-Net, or Institutional Network, is envisioned as a logical extension of activities and infrastructure that already exist in the county. For several years, Dakota County has allocated substantial funds to add conduit and/or dark Ðber cable to a variety of capital improvement projects and plans to continue to make signiÐcant investments over the next several years. e County has also brokered numerous Ðber sharing, construction cost sharing, and Ðber swap deals with other local and state agencies. ese deals have been executed typically as individual Joint Powers Agreements, and there are now more than one hundred individual JPAs that regulate various bits of Ðber and broadband infrastructure in the county. As previously discussed individual cities like Apple Valley, Eagan, and Burnsville have also invested in Ðber for both government use and commercial use (in some cases). Independent School Districts 192 and 196 both have built private Ðber networks to connect schools. e immediate impact of the diverse infrastructure eorts has been direct and measurable savings to taxpayers through reduced costs for connecting government and school facilities. Adding a C-Net on top of an existing or expanded I-Net will result in some interesting eciencies. Existing local government and K12 school networks have their highest use during business hours--put another way, the I-Net capacity is under-utilized during the times (evenings, weekends) when residential use is highest. Adding a C-Net and encouraging private sector development of Ðber to the home not only would create a revenue stream that would over time repay some of the capital costs of the network, but would increase the overall eciency of use. Eagan, Burnsville, and Apple Valley have individually used Ðber assets to create local I-Net and C-net infrastructure, but these assets are not connected in a way that provides countywide economic development beneÐts. I-Net BeneÐts and EfÐciencies An enhanced I-Net would, managed by a cooperative agreement among the cities and the County (e.g. a JPA) would have substantial beneÐts. e new I-Net cooperative management entity would set a goal, over a period of several years, of delivering a minimum of one Gigabit Ðber or multi-megabit broadband wireless to every government location in the county, with the ability to upgrade facilities on an as-needed basis to 10Gig and 100Gig circuits. An umbrella management entity would reduce the cost of new Ðber deployment opportunities and make it easier for the cities to use County Ðber within local boundaries. New agreements and opportunities for inter-governmental network asset sharing could be executed more quickly and at less cost because the enhanced I-Net entity is empowered to negotiate and execute those agreements. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 20 One stop management and tracking of Ðber and conduit assets will enable the County and the cities to make more ecient and more timely use of the the I-Net network. e cities would be able to make better use of both existing County Ðber and the substantial County Ðber route extensions planned for the next several years. Cities, by being able to make use of the shared Ðber facilities, should be able to reduce their own planned Ðber capital expenditures while simultaneously reducing operating costs for connectivity between their own facilities. e County is already working with MNDOT and the cities on shared Ðber use to connect more trac signals and intersections together, and the trac control cameras now being used to manage trac signals also typically have the ability to provide remote video feeds--potentially representing thousands of new I-Net circuits using enormous amounts of bandwidth. As more intersections are connected to Ðber, more Ðber will be needed throughout the County. It is worth noting that while there is an expense related to automated trac signal management, the cost savings in terms of more ecient fuel use (less fuel burned waiting for trac lights and/or in trac backups) represents an indirect but substantial cost savings over time. Fiber- supported trac management is a green energy initiative. A county-wide shared network would further facilitate local government services resiliency and reliability by creating a series of redundant, self-healing Ðber rings throughout the county. is highly resilient and redundant network would support critical city and county services like Ðrst responders, Ðre and rescue services, monitoring of water and sewer facilities, physical security of critical public infrastructure, and reduced use of energy in government facilities through improved monitoring and energy management. Both the County and the cities could reduce the cost of Ðber/conduit outside plant maintenance and repairs (e.g. emergency break Ðxes, routine repairs and replacement) if that responsibility was delegated to the JPA, which could then negotiate a single Outside Plant (OSP) maintenance contract for JPA members. A C-Net that would aid city-level economic development would be much more dicult to implement without a joint city/County collaboration on an enhanced I- Net network. e cities will Ðnd it very dicult to leverage CountyÈs very substantial investments in conduit and Ðber without a comprehensive sharing and collaboration agreement in place for the I-Net. e I-Net is a necessary Ðrst step to provide economic development beneÐts of Gigabit Ðber to the cities. C-Net BeneÐts and Economic Impact e goals of a C-Net would be as follows: Leverage the already signiÐcant investments made by the County and some of the cities to the overall beneÐt of citizens, businesses, and institutions in the county. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 21 Make the most ecient and eective use of planned future conduit and Ðber investments by the County to make the cities more attractive to relocating businesses To reduce the cost of bandwidth and broadband services for local businesses and to help retain existing businesses and jobs. Reduced costs for telecommunications for small businesses. While a main focus of discussion around a C-Net has been on large business needs, the county has thousands of smaller businesses that would beneÐt from a wider choice of telecom services with competitive pricing. Give city and county economic developers a powerful tool, in the form of a high performance, aordable Ðber network, to support economic development. Use the excess capacity of existing and planned I-Net infrastructure to create new revenue streams (on a cost plus basis) to help pay down capital costs already expended, fund additional network expansion, and over the long term, return some revenue to the general fund of the asset owners (i.e. the County and the cities that own the asset). A county-wide C-Net backbone with aordable wholesale pricing (i.e. open access) would make it easier to attract private investment for Ðber to the home (FTTH) expansion, particularly into residential neighborhoods. C-Net Ðber passing by a residential neighborhood would make it less expensive for a private provider to develop a business case for the capital cost of constructing Ðber to the home. Revenue generated from the monetization of spare capacity could be used to repay capital expenditures undertaken by the County and the cities. Revenue could also be allocated to directly support expansion, and over time, revenue could be returned to the General Fund of the infrastructure owners (e.g. the County or the cities). e most signiÐcant beneÐt of a C-Net leveraged on top of an enhanced I-Net would be the ability of any city or County economic developer to say to a business relocation prospect: ÅCome to Dakota County. We can give you whatever amount of bandwidth you need to run your business.Æ With more than three hundred other communities in the U.S. already able to say this or in advanced planning to be able to make this claim, Dakota County needs to be able to retain existing businesses and to attract new ones. We have worked with two other communities in other parts of the country that initiated C-Nets because the largest employer called and said, ÅWeÈre leaving if you donÈt reduce the cost of bandwidth and improve the level of service available.Æ ese businesses had the option of leaving precisely because other localities have already made the investment of planning, time, and capital to put business- ready C-Nets in place. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 22 Business Models and Ownership Governments build and manage roads, but donÈt own or manage the businesses that use those roads to deliver goods and services. In this third way, there is true competitive pricing between competing service providers, and little or no government regulation is required. e tremendous versatility of the Internet and the underlying technology bases now allows services that used to require their own, separate (analog) road system (voice telephony and TV services) to be delivered alongside other services like Internet access on a single, integrated digital road system. If we managed overnight package delivery the way we manage telecom, UPS and Fedex would only deliver packages to residences and businesses where each delivery Ðrm had built a private road for their exclusive use. We recognize immediately the limitations of such a business modelÃfew of us would have overnight package delivery to our homes because the small number of packages delivered would not justify the expense of building a private paved road. Before the rise of the automobile, most roads were built largely by the private sector. After cars became important to commerce and economic development, communities began building and maintaining roads because it became an economic development imperative to have a modern transportation system in communities. Before the rise of the Internet, digital networks were built largely by the private sector. As broadband has become critical to commerce and economic development, communities with digital roads are more competitive globally. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 23 A UTILITY COMPARISONA UTILITY COMPARISONA UTILITY COMPARISON SHARED ROADSSHARED AIRPORTSSHARED TELECOM Historically, roads have been Airports are built and Duct, Ðber, and wireless sites built and maintained by the maintained by a community or and towers may be built and community for the use of all, region as an economic and maintained by the community especially private Ðrms that community development asset. and/or a neutral owner/ want to use them to deliver Both public and private users operator for the use of all, goods and services.beneÐt from the shared use of including private Ðrms that a single, well-designed airportwant to use them to deliver goods and services. Access to the community road Airport assets like departure In the digital road system, system is provided by parking gates, ticket areas, and runways access across private property lots and driveways, built by provide access to the airline to the communityÃwide property owners, developers services.network in the public right of and builders.way is provided by duct, Ðber, and wireless systems built by property owners and/or developers and builders. The local government uses While the local government or Local government uses the roads only to deliver a consortium of local digital transport system only to government services. Local governments typically own the deliver government services. government does not offer airport facility, the local Government does not offer services like overnight package governments do not offer Ñight services like Internet access or delivery.services. Voice over IP. Private sector businesses use Private sector airlines are able Private sector businesses use roads so that their own cars to offer competitively priced the digital transport system to and trucks can deliver goods airfares because of the shared deliver goods and services to and services to customers. cost of the airport terminal customers. Because businesses Because businesses do not facilities. Each airline does not do not have to build and have to build and maintain build its own airport (which maintain a digital road system, roads, all businesses beneÐt would sharply increase the cost all service providers beneÐt directly by being able to reach of airfare).directly by being able to reach more customers at less more customers at less expense. expense. There are no road connection Businesses and citizens do not Any qualiÐed service provider fees, and anyone may connect pay a fee to access the airport may connect to the digital road to the road system for free. facility. The cost of maintaining system for a nominal fee and Governments pay for the cost the airport facility is paid by the begin to offer services, without of maintaining roads largely airlines, which bundle that cost any signiÐcant capital expense. from those that use the roads . into the price of airfare. Fees Network capital and operating Fees are proportional to use, are proportional to actual use costs are recovered by charging from taxes on tires and by Ñying customers. Airlines service providers a small fee gasoline.beneÐt because they do not that is based on a percentage have to build, own, and operate of their income from services the airport directly. Those offered over the system. costs are shared across all users. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 24 The Public/Private Partnership Because virtually any modern broadband network (and most older telecom networks) use public right of way for a large portion of network distribution, ALL business models are Åpublic/private partnerships.Æ e notion of the public/private partnership is not a distinct business model, but rather exists along a continuum, with minimal public involvement on one end (i.e. only use of public right of way) to full public ownership on the other end. Business Model Options ere are three business/ownership models that are were considered as part of the study. ese models are: Private Sector Only Municipal Retail Wholesale Multi-Service e table below summarizes the three models. Private Sector Municipal Wholesale Multi-Service Features OnlyRetailNetwork Three separate services Only three services Very high efficiency achieved Basic (voice, video, data) (voice, video, data) with by end to end automated service Concept with little or no sharing little or no sharing of provisioning. All providers of network.network.share network capacity. No government Government competes Government does not compete involvement. Private directory with the with private sector. Government Government sector decides where private sector. provides high performance Involvement and when to offer Government decides digital road system that benefits services. Some areas what services are all public and private users. get little or no service.offered. Buyers have rich set of choices. May be owned by local Owned and operated by Owned by a private government or by a community local government. company. Community enterprise like a broadband Governance Limited triple play must accept whatever authority or coop. Wide variety services sold directly by services are offered.of services sold by private sector local government. companies. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 25 Level playing field creates Little or none in most Government officials robust competition. Service areas. Cartel-like pick providers of each Competition providers drive down costs and pricing keeps prices service. No incentive to provide great service to get high.lower prices. customers. Unlimited. Low cost of market Limited. Providers can Limited. Government entry and high level of service Service offer triple play at resells triple play automation attracts service Options most.services.providers and encourages innovation. Limited by low returns Limited by low returns Unlimited. Revenue directly Revenue on the individual on the triple play linked to demand. Revenue services. services.increases with demand. Unlimited. Expansion Limited to high density Limited by triple play completely supported by population areas. Rural Service Area approach, which keeps revenue sharing or use fees. areas and smaller cities Expansion funds for expansion Open services network can area at a structural low.provide become financially disadvantage. sustainable relatively quickly. More complex network Government officials management required, but Some areas do not get must predict business Risks adequate service or reduces costs sharply for service technology needs years affordable pricing.providers, which encourages in advance. competition. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 26 Financing Options ÅThere is no money for broadband¼.Æ e Ðnancial analysis in the Ðrst section of this report provides a conservative 30 year expenditure estimate for routine and normal telecom services for businesses, residents, schools, and institutions in Dakota County. Over the next three decades, over 10 billion dollars will be spent on telecom services. is is estimate that does not include any adjustments for inÑation or price increases, nor does it take into account the ever expanding demand for new kinds of services. e model looks only at current demand and todayÈs retail prices. A community investment in a community-owned and managed digital road system, where all services are provided by the private sector, would have substantial beneÐts. What the table shows is that the region is already spending substantial sums of money on broadbandÃover $333 million a year. is amount represents an estimate of what is being spent by all public, residential, institutional, and business customers for landline services, including telephone, TV, and Internet access across the region. In fact, just the money spent in less than two years by residents, businesses and institutions in Dakota County would more than pay for the complete cost of building the proposed new all- to most homes and businesses in the county. Ðber network Funding Options A wide variety of funding strategies are available for building telecom infrastructure. Funding DescriptionNotes Source Long term debt instruments Revenue Bonds guaranteed with revenue Requires some equity/funding from other sources. from the network. General Long term debt guaranteed Generally more dicult to get approval from elected Obligation by local taxes.ocials and voters. Bonds In Minnesota, Statute Chapter 429 permits a Does not require a vote, but the locality does have Special Property special assessment that can to provide a report to citizens detailing cost, Assessment be levied by communities for necessity, and eectiveness of the improvement. infrastructure improvements Many community broadband projects have been Funding provided directly by funded in part or in whole by the local government. Cash the local government(s). These are often treated as a loan to be repaid with revenue. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 27 Funding DescriptionNotes Source Third party guarantees on revenue bonds; if revenue Guarantors could be local or state governments. Revenue Bond fails to meet Ðnancial targets, Does not require a direct cash outlay. Guarantor Guarantees bond guarantor makes debt must have a good credit rating. payments. Tax credits are sold to Project must meet eligibility requirements and New Markets investors, and funds are used typically takes a year to plan and to receive Tax Credits for the network.approval. State agencies may be Capital funds are usually small, but direct grants State Funds source of planning & capital from the legislature are possible. funds. Grants and loans of various Federal grant programs and funding tend to change Federal Funds kinds are often available from with changes in administration. Can take 1-2 years Federal agencies.for approval. Local governments can Municipal Can be used for funding speciÐc (limited) projects, borrow money and pledge Leasing like Ðber to a school system or government oces. the asset as collateral. Usually requires pledging network assets as Commercial Local banks are often willing collateral. Must be able to show a revenue stream to assist with funding.to pay back the loan. Good for small, high priority Loans network extensions with guaranteed customers. It depends on the corporate structure, but local A public/private partnership businesses and investors could become approach oers the shareholders or partners in the new telecom Ðrm, Private Sector possibility of attracting a mix eectively vesting community control for the eort. Financing of private investors as well as Because most of the funds will be used to create some local government hard assets, it will be possible to attract institutional Ðnancial support.investors for larger amounts if a good business case is constructed. Citizens and local Grants and Local foundations may require tying funds to a foundations will sometimes speciÐc purpose. Donations provide grants. Assess a small increase in the local sales tax to pay for Sales Tax construction, or use existing May require a voter referendum. sales tax revenues as a bond guarantee. Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 28 Project Phases Development of an expanded I-Net and a follow-on C-Net would both require the same set of activities, as illustrated in the diagram below. is report represents the Early Phase Planning as shown on the left. Decision point: Ready to move forward? Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 29 Infrastructure Maps During the course of the project Design Nine worked with the county representatives and representatives of the local municipalities to gain an understanding of the existing Ðber assets already constructed in the region. Design Nine then created new Ðber routes to ÅglueÆ together the existing municipal networks including an additional phase to create ÅlateralsÆ and redundant rings to Ñush out the network to more locations and create the redundancy required in a carrier grade Ðber optic network. Map: 5-Dakota-Basemap-20141030-Existing Networks and Assets 011,25022,50045,00067,500 Feet Private Fiber County Fiber City Fiber School Fiber Sources: Esri, HERE, DeLorme, TomTom, Intermap, increment P Corp., GEBCO, Dakota County, MN - Existing Fiber Networks Intellifiber USGS, FAO, NPS, NRCAN, GeoBase, IGN, Kadaster NL, Ordnance Survey, Esri Japan, METI, Esri China (Hong Kong), swisstopo, MapmyIndia, © OpenStreetMap contributors, and the GIS User Community Dakota County Broadband Study Summary DRAFT: Do Not Distribute page 30 Map: 7-Dakota-Basemap-20141030-Existing Network and Business/Residential Clusters 011,25022,50045,00067,500 Feet Map: 9-Dakota-Basemap-20141030-Network Additions (in two phases) Legend Owner Private Fiber County Fiber City Fiber School Fiber Intellifiber Address Points Business Customers Dakota County, MN - Fiber and Customers Sources: Esri, HERE, DeLorme, TomTom, Intermap, increment P Corp., GEBCO, Residential Customers USGS, FAO, NPS, NRCAN, GeoBase, IGN, Kadaster NL, Ordnance Survey, Esri Japan, METI, Esri China (Hong Kong), swisstopo, MapmyIndia, © OpenStreetMap contributors, and the GIS User Community Dakota County Broadband Study Summary DRAFT: Do Not Distribute with Members Regarding Dedicated , Identifies Process and Cost for Board Amends and Adopts Final Funding JPA Coordinates and Negotiates Operating the JPA through Initial Period Laws, Appoints Committees 31 Preparing the Systems Plans and page Assets and Other Issues BOD Prepares Administrative Systems Plans Withdrawing Members Responsible for No - that Preps By Further Obligations Effective Date of Agreement Plan Other Parties for Agreements Necessary to Members Review Adopted Systems Plan Members Review and Comment on greements with Vendors and does NOT and Reach Go / No Go Decision Implement the JPA Systems Plans Negotiates but Members Appoint Directors and Alternates STEP 2 to Participating Members Move JPA Board A xecute Implementation E STEP 1 JPA Board Adopts Draft Plans and n and Systems Funding Plan Drafts JPA Board Prepares Systems Pla Executing the Agreement and Members Paying Initial Membership Fee by Established Deadline Publishes those JPA Formed by page 32 2. DATE: June 29, 2015 TO: Mayor, City Council and City Administrator FROM: Tamara Schutta Assistant to the City Administrator/HR Coordinator SUBJECT: Technology Use Policy BACKGROUND The Technology Use Policy was last reviewed and updated in 2011. To maintain the integrity and security of the city’s IT Infrastructure, we have been working on updating our Technology Use Policy for all city employees, paid-on-call firefighters, contractors, volunteers, and interns and firefighters. The Technology Use policy has been reviewed by City Attorney Kevin Rupp and is a draft that we are planning on presenting to the city st council for approval on July 21. The purpose of this policy is to promote the availability and reliability of City-owned equipment for productive employee use in providing effective and efficient service to our citizens. One part of fulfilling that purpose is to define acceptable use, including parameters for appropriate personal use of such equipment and information. Access to a copyof the draft policy has been provided to all employees for their review. The IT Manager and I will also be providing an overview of the Technology Use Policy on th Wednesday, July 8for employees. The Technology Use Policy document is 19 pages, so staff is presenting a copy of the policy for your review prior to July 21, 2015. If you have any questions or concerns with the policy,please contact me. Attachment(s): 1.Draft copy of Technology Use Policy BUDGET IMPACT Not applicable. RECOMMENDATION No action at this time. Review only. page 33 TECH./,/'9 53% POLICY ȃ DRAFT 4 ¡«¤ ®¥ #®³¤³² 1. Purpose ................................................................................................................................................. 3 2. Definitions ............................................................................................................................................. 3 3. Application ............................................................................................................................................ 5 4. Security ................................................................................................................................................. 5 4.1. Logins and Passwords ................................................................................................................... 5 4.2. Physical Security ............................................................................................................................ 6 5. Data ....................................................................................................................................................... 7 5.1. Data Practices ............................................................................................................................... 7 5.2. Record Retention Schedules ......................................................................................................... 7 5.3. Data Ownership and Expectation of Privacy ................................................................................. 7 5.4. Data Storage .................................................................................................................................. 8 5.5. Portable files ................................................................................................................................. 8 5.6. Data Security ................................................................................................................................. 9 6. Copyright and Licensing ........................................................................................................................ 9 7. Allowable Uses ...................................................................................................................................... 9 7.1. Personal Use ................................................................................................................................. 9 7.2. Internet ....................................................................................................................................... 10 7.3. Email ............................................................................................................................................ 11 8. Prohibited Use .................................................................................................................................... 12 page 34 8.1. General Prohibitions ................................................................................................................... 12 9. Access .................................................................................................................................................. 13 9.1. Remote Network Access ............................................................................................................. 13 9.2. Wireless Access ........................................................................................................................... 13 10. Office/Cellular Telephone ............................................................................................................... 14 10.1. Office Telephones ................................................................................................................... 14 10.2. Cellular Telephones ................................................................................................................. 14 11. Maintenance and Support .............................................................................................................. 14 11.1. File Names and Storage Space Usage, Limitations, and Maintenance ................................... 14 11.2. Safeguard Policy ...................................................................................................................... 14 11.3. Equipment Maintenance & Disposal ...................................................................................... 15 12. Social Media .................................................................................................................................... 15 13. City Website .................................................................................................................................... 15 13.1. Participation ............................................................................................................................ 15 13.2. External Links .......................................................................................................................... 15 13.3. Event Promotion ..................................................................................................................... 16 13.4. Disclaimer ................................................................................................................................ 16 14. Training & Documentation.............................................................................................................. 17 15. Disciplinary Action .......................................................................................................................... 17 Appendix A ........................................................................................................................................ 18 page 35 1.Purpose The purpose of this policy is to promote the availability and reliability of City-owned equipment for productive employee use in providing effective and efficient service to our citizens. One part of fulfilling that purpose is to define acceptable use, including parameters for appropriate personal use of such equipment and information.This policy is intended to be a general use policy. Department heads and supervisors are responsible for ensuring the appropriate use of all electronic tools and other equipment through training, supervising, coaching, and taking disciplinary action, when necessary. Users may be assigned City-owned equipment and are responsible for the reasonable protection for such equipment and information against theft, loss, environmental damage, viruses, and other risks. 2.Definitions Unless otherwise indicated, thefollowing words and terms have the meanings indicated below: Blog – is short for web log. A blog is a webpage that serves as a publicly accessible personal journal for an individual. Blogs often reflect the personality of the author. Broadband – is a wide bandwidthdata transmissionwith an ability to simultaneously transport multiple signals and traffic types. The medium can be coaxial cable,optical fiber,twisted pair, or wireless broadband(wireless broadband includes Mobile broadband). Configuration – is the way a system is set up or the assortment of components that make up the system. Configuration can refer to either hardware or software or the combination of both. Download – is a copy of data or software from a main source to a computer device. The term is often used to describe the process of copying a file or software from an online service or bulletin board service to a computer. Downloading can also refer to the copying of a file from a network file servers to a computer on the network. Electronic Mail (email) – is a network application that allows users to exchange messages over networks. File Server – is an enhanced computer with network operating software that is used for file storage, application functionality, and managing network resources. Information Technology (IT) – manages the process and use of information on multiple platforms. page 36 Information Technology (IT) Systems – includes computers, printers, software, email, Internet, Intranet, telephone, voice mail, and similar equipment as deemed appropriate. Internet – is the global network connecting millions of computers and networks around the world. Intranet – is a network based website accessible only within an organization. Intranet websites look and act just like any other website, but firewall security restricts external access. Licensing – is the legal compliancy of IT systems hardware and software assets. Malware – software intended to damage a computer, mobile device, computer system, or computer network, or to take partial control over its operation. Peripheral – is a computer device, internal or external, that is not part of the computer itself, such as a CD-ROM drive, printers, keyboard, mouse, and monitor. Phishing – is the act of sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft. Portable Equipment – is the hardware that is small, lightweight and mobile (i.e. laptop computers, tablets, hand-held computers, projectors, flash drives and digital cameras). Social Media – is a conversation in print.Social Mediaincludes the various online technology tools that enable people to communicate easily via the Internetto share information and resources. Social Media can include text, audio, images, podcasts, and other multimedia communications. Software – system software includes the operating system and all utilities that enable the computer to function. Application software includes programs that assist users (i.e. word processors, spreadsheets, and database management systems). SPAM – is electronic junk mail or junk newsgroup postings. Users –regular,part-time and temporary employees, paid-on-call firefighters, contractors, vendors, consultants, volunteers, interns, elected officials, members of City commissions and boards, and other individuals authorized to use the City’s IT system. Virus – a segment of self-replicating code planted illegally in a computer program, often to damage or shut down a system or network. page 37 Wi-Fi – a facility allowing computers, smartphones, or other devices to connect to the Internet or communicate with one another wirelessly within a particular area. 3.Application The Technology Use Policyshall apply to all employees, contractors, volunteers, interns,and paid-on-call firefighters who have access or use the City of Mendota Heights IT system. To the extent permitted by law, the Technology Use Policywill also apply to elected officials and members of Citycommissions and boards. The misuse of City property and/or equipment or any violation of the Technology Use Policymay result in disciplinary action per Section 27of the Mendota Heights Personnel Code, applicable labor agreementsor through otherapplicablerules and laws. To the extent permitted by law, elected officials and commission members found to have misused City property/equipment or violated the Technology Use Policymay be subject to disciplinary action approved by the City Council. If applicable, violations may also be referred for criminal prosecution. Security 4. 4.1.Logins and Passwords As a member of the Local Government Information Systems(LOGIS) consortium, the City of Mendota Heights must adhere to the security requirements and recommendations set forth within the LOGIS Member Security Policy to ensure security, protection, and appropriate access to all of the City’s IT systems and resources. As such, all Usersmust maintain unique IT-issued login IDs/usernames for computer and network-related access. All passwords are to be treated as sensitive and confidential information. Usersmust not share passwords with anyone. If the system administrator needs to logon as a User, the administrator will change the User’s password to the default password, and the User will be prompted to change the password next time the User logs onto the network with the default password. All system and user level passwords must follow these specifications: Have a minimum of at least(8) alphanumeric characters in length. Must be changed every 90 days. page 38 Have not been previously used in the last tenpassword rotations. Not contain the user's account name or parts of the user's full name that exceed two consecutive characters Contain characters from three of the following four categories: English uppercase characters (A through Z) English lowercase characters (a through z) Base 10 digits (0 through 9) Non-alphabetic characters (for example, !, $, #, %) Comment \[SD1\]: Changed this section to accurately reflect our current policies required by LOGIS. The password policies will bedefined on the server level to ensure adherence to policy. Passwords should never be written down or stored on-line. Try to create passwords that can be easily remembered. One way to do this is create a password based on a song title, affirmation, or other phrase. For example, the phrasemight be: "This May Be One Way To Remember" and the password could be: "TmB1w2R11!" or "Tmb1W>r~11" or some other variation. Users must report password security breaches to the IT Manager immediately. This includeswhenanaccount is suspected to have been compromised and/or if someone demands a password. Only the User must know the password. 4.2.Physical Security Usersare expected to provide reasonable security to their computer workstations and related IT equipment. This includes ensuring that removable media is kept in a secured area, and confidential data is not displayed in such a manner that unauthorized personnel can view it. All IT equipment is City property and must remain on current premises. Users may not moveIT equipment outside of its assigned area without prior approval from the IT Managerand a department supervisor. Designated portable equipment, such as laptop computers,tablets,projectors, and digital cameras, may be removed from City buildings only for City business. Portable computing equipment must be reserved and checked out only toUsers.Users are expected to provide appropriate “common sense” protection against theft, breakage, environmental damage, and other risks. Theft or loss of any portable computing equipment used for City business must be reported immediately to a department supervisor and the IT Manager. Users should shutdown computer workstations when absent for an extended time, such as forthe weekend or for vacation. Users may, however, log off their workstations and turn off the monitor, instead of shutting down, when absent for less than 24 hours. Users must lock theirworkstations (press Ctrl-Alt-Del keys) when away from theirdesk or office, however, all computers connected to the City’s page 39 network remaining inactive for at least 5minutes will lock automatically and have a password protected screensaver activated which will require re-authentication to unlock. Data 5. 5.1.Data Practices Data that the City maintainsin an electronic format isgovernment data and, as such, issubject to classification and access under the Minnesota Government Data Practices Act, Minnesota Statutes Chapter 13. Users should understand that electronic data may not be completely secure. They should also understand that emailmessages and Internet transactions, including those they delete or erase from their own files, may be backed up or recorded and stored centrally for system security and investigative purposes. Emails and records of Internet activities may be retrieved and viewed by someone else with proper authority at a later date. It is the User's responsibility to use care in communicating information not meant for public viewing. Because electronic communication systems, such as facsimile, emailandInternet systems may not be secure, it is recommended that employees not send any data classified under the Minnesota Government Data Practices Act as not public (private or confidential data on individuals or nonpublic or protected nonpublic data not on individuals) through unsecured facsimiles, email, or Internet systems unless the data isencrypted or encoded.Users should contact the IT manager with any questions about encrypting or encoding data. 5.2.Record Retention Schedules Record Retention Schedules are the same regardless of the medium used to create or store the record. As a result, many electronic records and emailmessages are official records of the City and must be retained in accordance with the City’s approved Record Retention Schedulesappropriate for the type, nature, and content of the record. Improper disposal of an official record may subject the employee and the City to legal sanctions and other administrative or legal consequences. The same rules that are used to determine if a paper or videotaped record should be retained apply to electronic records or email messages. 5.3.Data Ownershipand Expectation of Privacy All information developedinor introduced to the City's IT system by a network User in conjunction with the User’s job duties or performance of services for the City is considered property of the City.As a government agency, the City is subject to laws page 40 governing data privacy and records retention. All files and documents, including emailmessages and Internetlogs, are owned by the City and may be subject to requests under public records law. Users have no expectation of privacywith respect to their use of the City’s IT system. City-owned computers, telephones, facsimile machines, emailand Internet systems are the property of the City and any and all software, data, or other information stored on a City-owned electronic device may be monitored, read, examined, seized, or confiscated. Therefore, Users should not expect that any facsimile, voicemail, emailmessage, either sent or received, or any Internet activitiesconducted using the City’s IT systemsare private. When a User terminates employment with the City or otherwise ceases to perform services for the City, the User gives up his/her rights to alldata, voice mail, email, email contacts and cell phone contacts stored on the City’s IT systems to the City. All of these items are City property. After termination of employment or when a User no longer provides services for the City, the City is no longer responsible for maintaining or keeping data related to the User on file unless maintaining the data is necessary to comply with record retention requirements. The information may be deleted without notice to the User. Any User who terminates employment with the City or otherwise stops performing services for the City must leave all existing files and City data organized in an orderly fashion. 5.4.Data Storage All City data must be saved to a network drive found on the City server. Users are responsible for deleting outdated files that are no longer needed (in compliance of the City's Record Retention Schedules); this includes data files and email messages. The City Clerk should be contacted if staff has questions or concerns regarding the City Record Retention Schedules. 5.5.Portable files To facilitate off-site work, Users may copy appropriate files, including word processingfiles, spreadsheets, and presentationgraphic files to and from removable media, such as diskettes/CDsor USB “flash drives”only with the permission of a department supervisor.Files or information may be copied to or from City computersonly to the extent necessary to facilitate on-site or off-site work.A current copy of anyfile(s)copied to or from removable mediamust be maintained on the City server.Prior to reinstalling the portable file media back onto the City system, the employee shall be responsible for performing a virus scan to ensure that malicious software isnotintroduced into the City system. page 41 5.6.Data Security The IT Manager regularly backs upall data stored on the City’s file servers. Workstation hard drives(c-drive)are not backed up on the City’s file server. 6. Copyright and Licensing City-owned software may not be installed on non-City-owned equipment unless there is prior approval from a departmentsupervisor andtheIT Manager. Any software programs, such as custom designed Microsoft Access databases, developed for use by the City is the property of the City. Such software programs may not be sold or distributed without prior approval. The City of Mendota Heights complies with all software copyrights and terms of all software licenses. Users may not duplicate licenses, software, or related documentation. Any such duplication may subject Usersand/ortheCity to both civil and criminal penalties under the United States Copyright Act.If there is any question about the legality of the software and documentation, it should be directed to the IT Manager. To prove legal ownership of software, the City must have the original media and manuals stored on City property. The IT Manager may periodically check for software that may be in violation of the City’s Technology Use Policy. 7.Allowable Uses 7.1.Personal Use This policy is not intended to prohibit Usersfrom using technology within the organization for personal use, however, personal use shall be done in a reasonable manner, respectful of the rights and dignity ofall, and may be limited by a department supervisor and/ordepartment head for any reason.A User’s personal use of any City IT system must not interfere with the User’s job duties or performance of services for the City. The following controls are necessary to protect the City’s equipment and computer network and prevent Users from abusing the privilege of using technology for their personal use: Only Users, as defined by this Policy, may use City-owned equipment. Family members or friends of Usersare not allowed to use Cityequipment or technology resources. page 42 Personal use must take place during non-work hours (breaks, lunch hour, before or after work). Personal use should never preempt work use. IfaUserwants to use or connect the User’sown flash drive, CDor disk to City-owned systems the Usermust have prior approval from a department supervisorand must follow provided directions for protecting the City’s computer network.Personal cellphones and audio/video devices such as mp3 players are prohibited. Files from appropriate personal use of the City’s equipment may be stored on the User’scomputer’s local hard drive, providing thetotalsize of all personal files does not exceed 50 MB. At no time maypersonal files that contain copyrightedmaterial, such as mp3 files or photos, be stored on Citycomputer systems. The Citymay inspect any data or information stored on its equipment or networkat any time, even if the information is personal to the User. City ITsystemsshall not be used for any purpose which is malicious, discriminatory in nature, illegal, or which would reflect negatively upon the reputation of the City of Mendota Heights or any official of the City of Mendota Heights.Use of Cityequipment or technology for personal business interests, for-profit ventures, political activities, or other uses deemed by the City Administrator to be inconsistent with Cityactivities is not allowed. If there is any question about whether a use is appropriate, it should beforwarded to the City Administrator for a determination. 7.2.Internet The City provides Internet access to Usersfor work on City business. Use of the Internetby Users is encouraged (and in many cases required) for work-related purposes.Occasional personaluse of the Internet is acceptable, provided it does not interfere with a User’s job duties and is consistent with all other provisions of this Policy.The following controls are necessary to protect the City’s equipment and computer network and prevent Users from abusing the privilege of using the Internet for their personal use: Internet use during work hours must be limited to subjects directly related to a User’s job duties.Personal use of the Internet must take place during non- work hours (breaks, lunch hour, before or after work). Users’ personal use of the Internet must be limited to websites that are appropriate in the workplace. Users may not at any time access websites that are inappropriate or disruptive in a work setting. By way of example, inappropriate and disruptive websites include, but are not limited to, adult entertainment sites or any other website containing sexually explicit material andwebsites advocating intolerance of any race, religion, or other group of people in a manner thatwould violate City policies related to a respectful workplaceor prevention of discrimination and harassment.If you are unsure page 43 whether a website may include inappropriate information, you should not visit it. No software or files may be downloaded from the Internet unless approved in advance by a department supervisor and/orIT Manager. This includes, but is not limited to free software or downloads, maps, weather information, toolbars, music or photo files, screensavers, and games. Clipart downloaded through Microsoft Office is acceptable provided User is abiding copyright laws. Users may not participate in chat groups or instant messaging. Usersare prohibited from conducting the following online activities using the City’s Internet access: gaming, shopping, gambling, and auctions. Users may not engage in social networkingand bloggingactivity usingthe City’s Internet access(including access via the City’s wifi) unless the User is required to do so in the performance of his/her job duties. The Citymay monitor any employee’s use of the Internet for any purpose without prior notice, as deemed appropriate by the City Administrator. 7.3.Email The Email system is a tool to be used for matters directly related to the business activities of Usersand as a means to further the mission by providing services that are efficient, accurate, timely, and complete. The City allows Users to access personal email accounts via the Internet provided such access occurs during non-work hours and fully complies with this Policy. A User’s personal email(and other personal documents) accessed via a Citycomputer could be considered “public” data and may not be protected by privacy laws. Personal emailand computer use may be monitored as directed by the City Administrator and without notice to the User.Usersshould not expect privacy in any activity conducted on a City-owned computer.Automatic forwarding of city email to personal email accounts is prohibited. Emailmessagessent or received using the City’semail systemare subject to regulation under the Minnesota Government Data Practices Act.Users must not expect privacy with respect to their use of the City’s email system. For example, a User’s email correspondence could be disclosedby the Cityin accordance with a request for public data under the Minnesota Government Data Practices Act. Users are responsible for adhering to business standards when email is created, sent, forwarded, or savedusing the City’s email system.Business standards include: Using appropriate and professional language. Using the City’s emailsystemin compliance with all applicable City policies, including policies related to a respectful workplace and prevention of harassment and discrimination. page 44 Refraining from gossip, harassing or insensitive language, inappropriate jokes, and insulting comments. Failure to adhereto business standardsputs the Cityand the Userat risk for legal or financial liabilities, potential embarrassment, and other consequences. Email is subject to the Minnesota Data Practices Act. Critical email correspondence and attachments should be saved to an appropriate location on the City’s network. Unnecessary email should not be kept for an extended period of time. Delete all inbox, sent, and deleted messages that are no longer needed, adhering to the City’s Record Retention Schedules. 8.Prohibited Use 8.1.General Prohibitions All Users of the City's IT systems, including Internet,Intranet, and email, are strictly prohibited from transmitting, accessing, or receiving material of the following nature: Illegalor criminalactivities; Items sold on the Internet for personal profit; Threatening, intolerant, hateful, violent, or harassing material; Pornographic, obscene, offensive,orsexually explicitmaterial; Mass mailed jokes and other chain letters; Games, gambling, wagering, or selling chances; Fundraising or charitable solicitations, except for City-approved activities; Unauthorized software programs or executables; Applications for a City-owned smartphone, tablet, or other mobile device (unless the User receives prior permission from a department supervisor and theIT manager; if a User downloads an application without permission, the User will be responsible for paying any expenses incurred by the City); Non-business audio, video or image files, copyrighted material, or large data files not directly related to City business; Political or religious promotion; Access resulting in unauthorized expense to the City; Activities that interfere with or disrupt network users, services, or equipment, including mass distribution of messages, intentional distribution of viruses, or seeking unauthorized access to other computers or systems; Chat or instant text messaging; and Unauthorized proxies or peer-to-peer networking. Police Department personnel that are using the Internet, Intranet, or other IT devices in the course of investigating a criminal matter are exempt from the aforementioned provisions. page 45 Users are prohibited from downloading or installing any software through the Internet, email, or any other source without prior approval from a department supervisor and the IT Manager. Users are not allowed to change the computer setup or configuration files. 9. Access 9.1.Remote Network Access Remote access is defined as the ability to connect to a computer or network from a distance, such as from home, a hotel, a conference, or an Internet kiosk.Remote access to the City's network, or any City-owned device, may be granted upon meeting the following conditions: Remote access must be for a business-related purpose approved by a department supervisor and the IT Manager. Only methods authorized, configured, and supported by the City will be used to remotely access City IT systems. While remotely connected, nobody but the authorized User may have access to the computer making the connection. The remote computer must comply with current anti-virus and security parameters as specified by the IT Manager. Please contact the IT Managerif you have any questions regarding anti-virus software. Remote access is generally limited to employees whoare classified as exempt and who frequently work independently on City business. Non- exempt employeesmay be given access based on their job duties with approval of their supervisor. Users should follow proper data practices protocols as directed by the Minnesota lawandthe City’s Record Retention Schedules.Users are prohibited from storing City data on home or personal computers without prior approval from a department supervisor. 9.2.Wireless Access Unauthorized wireless access into the City's network is strictly prohibited. Employees are prohibited from installing any wireless computing device or access point equipment on City equipment or property. page 46 10.Office/Cellular Telephone 10.1.Office Telephones Telephones may be used for incidental personal use as long as it does not interfere with the normal duties of the User and all guidelines are followed. Use of office telephones must meet the following standards: Telephones must be used primarily for City-related business. Any communication that may constitute verbal abuse, threats, intimidation, sexual harassment, or harassment of any kind is strictly prohibited. Use of telephones for personal business interests, for-profit ventures, political activities, or other uses deemed by the City Administrator to be inconsistent with City activities is not allowed. If there is any question about whether a use is appropriate, it should be forwarded to the City Administrator for a determination. Employees are responsible for reimbursing the City for any personal long distancecharges reported on the monthly statements, including taxes and feesassociated with such personal use. 10.2.Cellular Telephones This left intentional blank. This section is currently under consideration. Maintenance and Support 11. 11.1.File Names and Storage Space Usage, Limitations, and Maintenance The City reserves the right to set file naming conventions and manage the use of file storage space on any City-owned or used equipment. Such management includes, but is not limited to, which storage devices are used for specific purposes, limitations on the amount and type of storage used, and maintenance of storage such as deletion or archiving of older or infrequently accessed files, duplicated files, file versions, and files that should be managed per the City’s Record Retention Schedulesor other electronic retention policies. 11.2.SafeguardPolicy Great care should be taken with City technology devices. Do not leave laptops, cell phones,andother devicesor equipmentin cars or unsecured areas. In the event that City technology equipment is stolen or lost, please contact a department supervisor. If a department supervisor cannot be reached, please call the IT Manager at 612-730-8423. page 47 11.3.Equipment Maintenance& Disposal The City will inventory and maintain a record listing City-owned hardware and software. When computers, removable media and software are no longer in use, theywill be securely destroyed. This includes, but is not limited to,hard drives, cell phones, CD/DVDsand copy machine hard drives. 12.Social Media This left intentional blank. This section is currently under consideration. 13.City Website The website is provided as an additional communication tool between the City and the public it serves for the purpose of communicating Citybusiness. The website is not intended as a public forumfor general debate or the free exchange of ideas. Information related to events or business not sponsored by the City shall not be permitted. However,as outlined in this Policy, the City may use the City’s website to provide external links to other websites or notify the public of certain events within the community.All information on the City’s website will be provided in the most positive, professional, user-friendly manner possible. 13.1.Participation Departments are expected to actively participate in maintenance of the website, and must check theirdepartmentinformation on a monthly basis to ensure that information is current and fresh. Updates shall be provided to the Webmaster email address. 13.2.External Links The City may post external links to other websites within the City’s own website in accordance with the following criteria: The information inthe external website promotes economic welfare, commerce, and tourism in the City; and The information in the external website provides information regarding government or public services that is useful and informative to all City residents. page 48 Since theCity’s website is not a public forum, the City will not post external links to websites that advance political or religious causes, advocate for specific political candidates, or otherwise advance special interests or business interests that do not fall within the criteria outlined above. The City shall not be responsible for and does not endorse the information on any linked website, nor does the City guarantee the accuracy, completeness, or timeliness of the information on those websites. The City is not liable for defamatory, offensive, or illegal conduct of linked websites. The links from the City’s website to other websites do not constitute or imply endorsement or recommendation on the part of the City. Any organization meeting the above criteria seeking to link to the City’swebsite shall make a request to the City Administratoror IT Manager. The City reserves sole and exclusive right to determine whether an organization or entity meets the enumerated criteria, and whether to approve the link. The City also reserves the sole and exclusive authority to discontinue website linkage based upon this policy as interpreted by the City. 13.3.Event Promotion The City may use its website to inform the public of certain events within the community, provided an event meets the following criteria: The event is a City-sponsored event; The event is a public meeting of a government entity that will take place within the City; or The event is a Community-wide event that is open, without charge, to the general public and promotes economic welfare, commerce, and tourism in the City. The City reserves the right to approve any and all event promotion materials and language before promoting the event on the City’s website. Since the City’s website is not a public forum, the City will not promote events that advance political or religious causes, advocate for specific political candidates, or otherwise advance special interests or business interests that do not fall within the criteria outlined above. 13.4.Disclaimer The City will make every effort to ensure the accuracy of the information provided on its website. However, due to the possibility of unauthorized modification of the data, transmission errors, HTML browser incompatibilities, human error, changes made page 49 since the last update to the website or other aspects of electronic communication that are beyond the City's control, the City does not guarantee the accuracy of the information provided on its website and is not liable for reliance on the information. 14.Training & Documentation Department heads shall be responsible for addressing stafftechnologytraining needs as part of the development of their annual budgets in an effort to ensure each User is adequately trained to accomplish the User’sjob duties. Annual training needs shall be reviewed with Administration in order to determine if there are cross-departmental needs. Technology training needs will be prioritized based on amount of need, training funds available, and applicability to job functions. Disciplinary Action 15. Violation of this policy may be grounds for disciplinary action, up to and including termination of employment with the City of Mendota Heights. Discipline does not preclude separate criminal penalties resulting from an employee’s illegal use of any IT systems. All discipline shall be in accordance with the City’s personnel policies and applicable labor agreements. page 50 APPENDIX A IT PROCEDURES Request for a new user account: All new user accounts, additions or deletions, will be directed to both the Assistant to the City Administrator/HR Coordinatorand the IT Manager.Department maintains a list of work-related authorizations as necessary. Reporting problems: When requesting IT service or support, please complete with as much detail, one of the following forms: 1.IT Helpdesk Form on the Intranet; or 2.The IT Service Request Form. Please note, details could include error messages, information about what was going on and where were you located when it happened, what troubleshooting steps were already taken? After hours support: Business hours are considered to be hours which City Hall is open, generally 8am-4:30 pm Monday through Friday. Hours outside of this timeframe are considered after hours. These procedures are designed to address technology problems that severely impact core operations, not minor equipment malfunctions that may be remedied by a temporary work around. End user Procedure: 1.If possible, start a helpdesk ticket at http://intranet.mendota- heights.com:81/portal/page/11-it-helpdesk. The more details included in the ticket, the better. 2.If the issue is technical and impairs core operationsafter hours, call 612- 730-8423 to reach IT or leave a message. 3.IT will respond to urgent issues within 60 minutes or as appropriate to the situation. 4.In the event the issue is not immediately resolved, IT will provide updates when possible until the issue is resolved. Incident Criteria: An after-hours response will occur if there is a technical problem that severely impacts core operations and there is no work around available. page 51 Examples of issues that DO require an after-hours response: No network connectivity for multiple computers/squad laptops Malicious software/virus attack or security breach affecting all devices on the network Alarm state in the Mendota Heights IT server room Email server unavailable City wide-incident response related (natural disaster, public events, etc.) LOGIS applications unavailable for multiple users Internet unavailable for multiple users Examples of issues that will not be addressed after until normal city hall hours (items of this nature will be addressedbased on priority): Non-functioning camera Inability for single user to print Cell phone not working One workstation/squad laptop unable to login One user unable to connect to the Internet Additional support contacts for police: CJIIN: provides support 24/7/365 at 651-438-8348 If, the call is after normal business hours follow the prompts to get assistance. You do not need to discuss a CJIIN call for help with a supervisor before calling. If the problem is noturgent or relates to recommendations or how to questions you may submit an email on the CJIIN home page. ProPhoenix: For errors while entering information into the program call 609- 953-6850 for support, please use your department issued cell phone. You do not need to check with a supervisor before calling. LOGIS (CAD, Bi-web & APS ticket writer): Please check with a supervisor or Sue Donovan before calling LOGIS. LOGIS provides 24/7/365 support at 763-230-7199 (fee-based). Additional support contacts for fire: LOGIS (CAD) – provides 24/7/365 support at 763-230-7199 (fee-based). page 52 3. DATE: June 29, 2015 TO: Mayor, City Council, and City Administrator FROM: John R. Mazzitello, PE, PMP Public Works Director/City Engineer SUBJECT: New Water Service Agreement BACKGROUND The City of Mendota Heights has been in its existing contractual agreement with Saint Paul Regional Water Service (SPRWS) since 1995. The agreement expires in November of 2015, and SPRWS has initiated the process of renewing the agreement. Under the current agreement, the City of Mendota Heights owns the distribution system and is responsible for all routine maintenance, rehabilitation, and replacement of system components. SPRWS supplies the water and is responsible for all emergency repairs, inspection or completion of new or replacement projects, and conducts all billing for the utility. Because of this arrangement, SPRWS charges a rate 20% higher than their base rate for other municipal customers to all customers in the City of Mendota Heights. Additionally, the City charges a 10% surcharge to all water utility customers to gain revenue for the Water Utility Fund, which is used to fund maintenance activity as well as rehabilitation and replacement projects. This issue was originally presented at the City Council’s January 2013 goal setting workshop. Additional information was provided at the May 2013 workshop, and this item was discussed again at the January 2014 goal setting workshop, and again at the May 29, 2014 workshop. Council was presented with the advantages and disadvantages of both a status quo agreement and an agreement that would convey ownership of the system to SPRWS. Based on the comments received at these meetings, and upon the direction of the City Administrator, staff has proceeded with the cautious direction from the Council of negotiating the ownership conveyance of the water system to SPRWS. There were a number of issues brought up by the City Council in the workshop settings that have been communicated to SPRWS for inclusion in the draft agreement, which should be prepared and submitted to the City sometime in February. These items include: 1. City retention of cellular phone tower rental fees (Article VI) 2. City retention of ability to store material inside the water tower (Article VI) 3. Reduction/elimination of surcharge on water bills (over time) as quickly as possible (Article III) 4. Ability to alter (or request altering) priorities to include water main work in conjunction with City street projects (and vice versa). (Article II) page 53 SPRWS has analyzed these requests and incorporated responses as part of the attached draft agreement. The City has ample opportunity to comment or counter-propose before the existing agreement expires in November of 2015. A summary of the proposed contract is as follows: Article I–Establishes an effective date of the agreement, supersedes previous agreement(s), and provides Mendota Heights with a seat on the Board of Water Commissioners as part of the suburban client agreement. Mendota Heights would need to contract with the other suburbs separate from this agreement in order to rotate into one of the two seats on the Board. Article II– Gives authorization to the Board of Water Commissioners to extend their service into Mendota Heights, That SPRWS will abide by City Code, and that the City will waive permit fees through the phase-in period. Authorized extension of system should neighboring communities wish to tie into SPRWS’ system, and conveys title of assets from the City to SPRWS. The City will grant an easement at the water tower site that allows SPRWS to access water tower. Article III–Establishes the water rates and phase-in schedule (6-years), defines existing deficient mains (Friendly Hills & Brompton) and deficient easements for utility, calls out historical frozen services, and establishes the ability to lease antenna space on the water tower. Provides an option for a flat fee system. Article IV– Speaks to the course of action should SPRWS ever be privatized or otherwise sold. Mendota Heights would have the option of contracting with the new provider, or regaining ownership of the system. Article V–Describes installation of new mains; whether covered by SPRWS, the City, or a developer. Establishes minimum warranty, standards, on installed mains, service connection installations, and right to inspect utilities. Article VI–Establishes lease rates and shares for water tower antenna leases, provides the City with the ability to use water tower for storage. Cell tower revenue –City retains 100% of all cell tower revenue during the phase-in period (6 years). In year 7, SPRWS is proposing a 50/50 split of revenues. Article VII– Work done to streets that are not part of the SPRWS work plan (casing ring adjustments, hydrant relocations, etc.) will be the responsibility of the City unless incorporated into a larger SPRWS project, the City will grant perpetual access to infrastructure including establishing easements where necessary. Article VIII–SPRWS will supply all meters and do all billing for water services, and has the ability to incorporate other billing services for an additional fee. Establishes Mendota Heights’ right to surcharge (currently 10%). It is up to the City to set surcharge rates. Article IX– No supplemental water supply may be connected to the system without prior written approval form the Board. Article X– Title XI of the Saint Paul City Code establishes the rules, regulations, and standards for the system. The Board would have jurisdiction in Mendota Heights if a drought driven consumption ban were ever to be put in place. The last consumption ban initiated by SPRWS was in 1988. Article XI– Sets the standard for new fire hydrants, SPRWS responsibility for inspecting hydrants, and the City’s responsibility for painting hydrants. The City will not be charged for water consumption for fire-fighting and training purposes. The City will be charged for all other page 54 water consumption, including ice rink flooding and street sweeping. The City will place hydrant markers for snow removal, and will coordinate hydrant spacing between SPRWS and the Fire Department. Article XII–Establishes procedure for amendments to the agreement. Article XIII–Notices, corrective actions, notice of termination, mediation, re-conveyance compensation. UPDATE th At the May 12 City Council workshop, the proposed agreement was reviewed and a number of clarification requests were made that staff and SPRWS have researched. The following is a summary of those clarifications: 1.What is the current value of the water system?:According to records kept by our Finance Department the book value of the water system as an asset is approximately $10.5 million. The liabilities of the system are approximately $10-$11 million. 2.What will the new water bill structure look like as the surcharge is draws down?:A breakdown of water bills using current rates is attached. 3.Is there a complete list of assets associated with the water system?:A list of water system assets is attached. 4.Can the 2010 renovation of the water tower be recognized in the contract?:Language has been added to the contract under Article III addressing the water tower renovation. 5.If the City “buys” the system back at a future date, will the City be charged for assets originally “sold” for $1.00?:This is covered by language in Article XIII, Section 5. 6.Can the current condition of the water tower be recognized in the contract?:Language has been added to the contract under Article III addressing the water tower condition. A revised contract is attached for Council review. Added language has been highlighted and underlinedto identify changes made to the contract. BUDGET IMPACT The impacts to the annual budget will depend on the structure of the new agreement with SPRWS. The proposed ownership conveyance agreement would reduce revenues to the Water Utility Fund, but would also reduce expenses from that fund, dependent on the structure of the agreement. While not related to the City budget, the ownership conveyance would reduce the rates paid by Mendota Heights’ water users. RECOMMENDATION Staff recommends Council review the contract provided by SPRWS, and offer any comments, suggestions, or questions to the Executive Director while he is here. Staff further recommends Council provide staff with direction as to whether the proposed agreement is acceptable. page 55 page 56 page 57 OMNIBUS AGREEMENT BETWEEN THE CITY OF MENDOTA HEIGHTS AND THE BOARD OF WATER COMMISSIONERS OF THE CITY OF SAINT PAUL This Agreement, dated this ______ day of ______________, 2015, is by and between BOARD OF WATER COMMISSIONERS OF THE CITY OF SAINT PAUL the (“Board”), CITY OF MENDOTA HEIGHTS (“Mendota Heights”). and the WHEREAS, the Board has provided water services to properties located within the City of Mendota Heights continuously since 1962 pursuant to the terms of retail water service agreements between the Board and Mendota Heights, with the current agreement dated December 27, 1995 being scheduled to expire on December 26, 2015; and WHEREAS, the Board and Mendota Heights have reached a mutual understanding by which the Board will continue to provide water services to properties within the City of Mendota Heights at water rates that will become equal to the rates charged to properties within the City of Saint Paul; Mendota Heights willhave representation on the Board of Water Commissioners through suburban representation; and Mendota Heights willconvey title to its water facilities to the Board. NOW THEREFORE, in consideration of the respective covenants contained herein, Board and Mendota Heights do hereby agree as follows: ARTICLE I Section 1.EFFECTIVE DATE This Agreement is effective on December 27, 2015, or after execution by the designated officials as authorized by resolution of the Board and Mendota Heights, whichever occurs last. page 58 Section 2.EXISTING CONTRACTS SUPERSEDED As of the effective date of this Agreement, all previous water service agreements and contracts existing between the Board and Mendota Heights shall be and are hereby superseded. Section 3.BOARD REPRESENTATION BYMENDOTA HEIGHTS An ordinance, approved on December 11, 1996 by the Saint Paul City Council, amended the Saint Paul Home Rule Charter toincrease the membership of the Board of Water Commissioners and allowed the appointment of suburban representatives to said Board. In accordance with the terms of that amendment, the Board has increased its membership to seven (7) members. Of those seven (7) members, two (2) Non-SaintPaul resident members represent all suburban cities served by agreements similar to this Agreement, and this provision would apply to Mendota Heights. Mendota Heights will contract separately with the other suburbs with regard to representation. In the event that the total number of residential water accounts plus commercial and industrial accounts (excluding auto-fire accounts) of communities located outside the City of Saint Paul and served by agreements similar to this Agreement exceeds forty-three percent (43%) of the total number of the Board’s water accounts, the Board will seek to change the number of Saint Paul appointees to four (4) and the number of suburban representatives to three (3). ARTICLE II Section 1.BOARD TO EXTENDSERVICE TO MENDOTA HEIGHTS The Board will extend its water service to properties located within the City of Mendota Heights subject to the rules and regulations enacted by the Board of Water Commissioners and in accordance with the terms of this Agreement. Mendota Heights does hereby concur in the Board’s extension of its water service and does hereby grant permission to the Board to construct, operate, maintain, repair, and replace water mains and other necessary appurtenances within the streets and rights-of-way of the City of Mendota Heights. The Board is responsible to provide an adequate quantity of water to page 59 properties located within the City of Mendota Heights, and to provide normal maintenance and repair to all of the facilities operated by Board in the supply of water, pursuant to the same terms, conditions, and policies that it follows for the provision of similar properties located within the City of Saint Paul. Section 2.MENDOTA HEIGHTSMUNICIPAL CODE The Board shall abide by the city of Mendota Heights Municipal Code when performing work in Mendota Heights’ rights-of-way. Mendota Heights agrees to waivepermit fees required for utility work and excavation in Mendota Heights’ rights-of-way for the duration of the phase-in schedule described in Article III, Section 1 of this agreement. Section 3.CONSTRUCTION COORDINATION In order to provide the greatest efficiency and to minimize traffic disruptions and replacement costs, Board shall perform water main replacement and/or other water system repair work in conjunction with Mendota Heights street paving projects whenever possible. Section 4.AUTHORITY TO EXTEND SYSTEM Mendota Heights does hereby agree that the Board has full and exclusive right to construct and maintain water piping in Mendota Heights’ property and rights of way, including public easements, for extending the Board’s water system to municipalities located beyond the corporate limits of Mendota Heights. Routing of mains and appurtenances shall be coordinated with Mendota Heights’ City Manager, which approval shall not be unreasonably withheld or delayed. The Board shall be solely responsible for all costs associated with the construction of such water system extensions, including the design, construction, and street restoration. Section 5.EXISTING MAINS AND APPURTENANCES OWNED BY MENDOTA HEIGHTS Upon the effective date of this Agreement,the Board will assume themaintenance and repair of all the existing water mains, hydrants, service connections, tanks, and appurtenances. page 60 Section 6.MENDOTA HEIGHTS TO CONVEY TITLE TO FACILITIES Mendota Heights shall, by resolution of its City Council, and by appropriate deed of conveyance acceptable to the Board, convey to the Board all of its rights, title, and interest to all water mains, hydrants, service connections, tanks, and appurtenances owned by Mendota Heights including all easement rights held by Mendota Heights for the purpose of installing, repairing, maintaining, or replacing public water mains and appurtenances. It is intended by the parties hereto that the said conveyances shall be free and clear of all liens and encumbrances whatsoever, and thereafter title shall remain with the Board except as may be otherwise provided by the terms of this Agreement. Section 7.EASEMENTAT TANK SITE Mendota Heights agrees to provide a perpetual easement, in a separate recordable document, to the Board for purposes of access and maintenanceat the water tower tank site located at the northwest quadrant of the intersection of Medallion Drive and Lexington Ave S in the City of Mendota Heights to be in effect by the date of execution of this Agreement. ARTICLE III Section 1.WATER RATES Commencing December 27, 2015, water rates, surcharges, and fees charged by the Board to properties located within the City of Mendota Heights shall be adjusted to the following Phase-In Schedule: PHASE-IN SCHEDULE December 27, 2015 through December 26, 2016 – 120 percent of Saint Paul rate December 27, 2016 through December 26, 2017 – 120 percent of Saint Paul rate December 27, 2017 through December 26, 2018 – 120 percent of Saint Paul rate December 27, 2018 through December 26, 2019 – 118 percent of Saint Paul rate December 27, 2019 through December 26, 2020 – 118 percent of Saint Paul rate page 61 December 27, 2020 through December 26, 2021 – 114 percent of Saint Paul rate December 27, 2021 and thereafter – 100 percent of Saint Paul rate Saint Paul Regional Water Services (“SPRWS”) performed an assessment of Mendota Heights’ water facility assets and identified certain assets that are deemed to be deficient and require upgrade or replacement.All assets not so identified, including the water tower, have been determined to be in acceptable condition and are not in need of improvement at the time of acquisition. The Board recognizes Mendota Heights’ renovation of the water tower in 2010. Funds generated from water rates greater than 100 percent of the Saint Paul Rate shall be used to compensate the Board for certain additional costs it agrees to assume pursuant to this Agreement, which costs are more fully described in Article III Sections 2 through 4 of this Agreement. The board shall have full authority in the scheduling and performance of the corrective work. Section 2.DEFICIENT MAINS Deficient water mains based on break history, a pipe failure predictability model, and SPRWS Standard for the Installation of Water Mains, as identified in Exhibit “A”, attached hereto and incorporated herein, shall be replaced at Board expense. Mendota Heights shall pay the costs to adjust the depth on segments of main with non- conforming earth cover as listed in Exhibit “B”, attached hereto and incorporated herein. Mendota Heights is responsible to manage and maintain water main easements such that the Board has ready access to conduct water facility maintenance, repair, and replacement or relocation activities. However, extraordinary costs due to the existing placements of water mains or services in non-conforming public water main easements as listed in Exhibit “C” shall be the responsibility of the Board. Section 3.WATER SERVICESWITH HISTORY OF FREEZING The Board shall be responsible for the costs of replacing, lowering, and/or insulating the water services to those services listed in Exhibit “D”, attached hereto and incorporated herein, which have a history of freezing. Section 4.ANTENNAE page 62 Extraordinary costs incurred in the maintenance of existing or future tanks serving Mendota Heights due to the placement of antennae facilities on or near such tanks shall be the responsibility of the Board, excepting those costs previously made the responsibility of any lessees as a course of existing and/or future leases entered into between Mendota Heights and a third party. ARTICLE IV Section 1.CONSOLIDATION OR ACQUISITION; MENDOTA HEIGHTS’ OPTIONS In the event that the Board ceases to operate in its present form due either to consolidation with a local or regional authority or to an acquisition of its assets by another entity (together referred to as “Alternate Authority”), it is the intent of the Board and Mendota Heights to protect the rights of Mendota Heights properties to the continued supply of an adequate water service as well as to adequately compensate Mendota Heights for its previous investments in the water facilities located within its boundaries. The rights and liabilities of this Agreement are not transferable or assignable by either party without the written consent of the other. Therefore, to the extent legally permissible the Board shall insure that in the event of any such consolidation or acquisition, Mendota Heights may terminate this Agreement or negotiate a new water service agreement with the Alternate Authority. In the event Mendota Heights should elect to terminate this Agreement, then and in that event, it is hereby agreed that: a)The Board shall for the sum of one dollar ($1.00), reconvey title to the facilities and real estate previously conveyed by Mendota Heights, pursuant to Article II, Section 6 of this Agreement; and b)The Board shall request, to the extent legally permissible, that the Alternate Authority execute a water service contract with Mendota Heights so as to continue to provide an adequate water service to properties located within Mendota Heights; and c)The Board shall be compensated for the depreciated value of all water mains and other water service facilities, including water meters, hydrants, and other appurtenances, page 63 constructed or caused to be constructed by the Board to serve the Mendota Heights water system from and after the effective date of this Agreement. The Board shall receive such compensation from the Alternate Authority and not from Mendota Heights. In the event that Mendota Heights elects not to terminate this Agreement, the Board shall require that the Alternate Authority assume the Board’s contractual obligations as set forth in this Agreement, and shall require that Mendota Heights be compensated for the amortized value of the facilities and real estate previously conveyed to the Board pursuant to Article II, Section 6 of this Agreement. Section 2.FACILITIES INVESTMENT The Board shall monitor and track all water system infrastructure investments within Mendota Heights to identify to what degree those investments benefit Mendota Heights. The Board shall monitor and track its investments in the water system, treatment plant, and transmission mains outside of Mendota Heights to identify to what degree those investments benefit Mendota Heights. The Board shall determine the asset value of Mendota Heights’ existing water system in order to assist Mendota Heights in determining whether to enter intoa new agreement with the Alternative Authority, or to regain ownership of the system. ARTICLE V Section 1.MAINS CONSTRUCTED BY MENDOTA HEIGHTS When Mendota Heights installs new water mains, service connections, and/or appurtenances for the distribution of water within the corporate limits of Mendota Heights, all construction shall be in accordance with Board standards. Plans of all extensions to the water system by Mendota Heights shall be submitted for approval to the Board before advertising for bids, awarding contracts, or beginning of actual construction. This initial construction for water system expansion shall be considered development costs and shall be provided at no expense to the Board. Costs for engineering plan review, inspection and other miscellaneous activity by Board forces required by the water system expansion shall be reimbursed to the Board. Mendota Heights agrees to provide the Board with “as-built plans” of all such extensions of the water system. page 64 Section 2.NEW FACILITIES; FURNISHED BY THE BOARD The Board may construct and maintain new water service facilities and appurtenances, including allextensions of such facilities and appurtenances. Title to all such facilities shall be held by the Board. Section 3.WARRANTY The Board and Mendota Heights further agree that as Mendota Heights constructs and contracts for the construction of new mains, services, and/or appurtenances to be connected to the system and supplied with water by the Board, that the Board shall not be responsible for the maintenance or repairs to such newly constructed additions to the water supply system until one (1) year from the date the same have been placed in operation, or until the Board has notified Mendota Heights in writing of the acceptance of such installation, whichever date is earlier. At such time that the Board assumes responsibility for the maintenance and repair of said new water system facilities, Mendota Heights will convey said facilities to the Board according to the conditions of Article II, Section 6. Section 4.STANDARDS Water mains, services, and appurtenances shall be in conformity with the established standards, rules, and regulations as are in effect at the execution of thisAgreement or as may thereafter be established by the Board. Mendota Heights and Board staff shall meet upon the request of either party to discuss standards relating to water system construction. Where differences in standards are not resolved at the staff level, the Board shall have the ultimate authority for determining such standards. Section 5.SERVICE CONNECTION APPLICATIONS New applications for water service connections shall be made to and through the Board, and each applicant shall furnish the Board a certified street address established by Mendota Heights. No new service connection work shall be performed by Mendota Heights or its agent until the Board’s application process has been completed and inspection of the installation work scheduled by the Board. page 65 Section 6.SERVICE CONNECTIONS –INSTALLED BY BOARD It is agreed that, except in those projects which may be mutually designated by the parties, all service connections from the main to the property line shall be installed by Board forces under rules identical with those in effect in the City of Saint Paul, or as may hereafter be modified by the Board. The charges for such service connections shall be in accordance with charges established from time to time by the Board. Section 7.SERVICE CONNECTION GUARANTEE BY BOARD The Board shall make all necessary repairs and maintenance to that part of the service connection located within the public right-of-way, under rules identical with those in effect in the City of Saint Paul. This requirement shall apply to all existing and future service connections constructed to Board standards. Service connections from private mains or a system not served by the Board’s water supply shall not be so guaranteed. Section 8.PIPING, FIXTURES, ETC. Mendota Heights shall, by the enactment of suitable rules, regulations, or ordinances, require that all piping, fixtures, accessories, or on premises piping in any manner connected to the public water system supplied by the Board, shall be of the same materials, installed in the same manner, and meet the same standards as are required for the same or similar work in the City of Saint Paul. Section 9.RIGHT TO INSPECT The Board, through its officers, agents, and employees, shall have the right at all times to examine, inspect, and test any materials or workmanship used, or to be used, in connection with the water system within Mendota Heights and supplied with water by the Board, or connections thereto, for the purpose of determining whether or not they comply with the foregoing provisions. For the same purpose, the Board shall have the right to examine and inspect the materials, workmanship, and method of installation of house plumbing connection to said water system. ARTICLE VI page 66 Section 1.ANTENNAE Mendota Heights shall transfer to the Board all ownership rights to Mendota Heights’ water service facilities, including easements and access rights for the transmission and reception of radio communication signals in and on its water tower, located at 2431 Lexington Avenue South (“Tank”). However, because Mendota Heights desires to retain control over the placement of antennae on the Tank after such ownership has been transferred to the Board, the Board agrees to enter into a site lease agreement with Mendota Heights, which grants back to Mendota Heights the right and authority for placement of existing and future antennae on the Tanks (“Site Lease”). The parties shall execute said Site Lease, identified as Exhibit “E,” attached hereto and incorporated herein, as part of this Agreement. In said Site Lease, the parties agree that, prior to approval by Mendota Heights of third-party sub-lease agreements for the placement of antennae or any other facilities on the Tank, Mendota Heights shall first submit proposed plans and said third-party sub-lease agreements to the Board for prior review and approval, which approval shall not be unreasonably withheld. The parties further agree in said Site Lease that, due to the increased administrative, impact review, maintenance, liability, staff, and other costs associated with such placements, Mendota Heights shall compensate the Board by paying to it fifty percent (50%) of the gross revenues received from any and all such activities.The Board shall initially collect paymentas part of Article III, Section 1, Phase-In Schedule in the amounts shown in Exhibit “F”. Pursuant to said Site Lease, beginning December 26, 2020, Mendota Heights shall pay directly to the Board fifty percent (50%) of said gross revenues within thirty (30) days of receipt of same. Section 2.STORAGE IN TANK COLUMN/TANK GROUNDS ACCESS Mendota Heights presently uses the column base of the Tank for storage. Mendota Heights and the Board shall execute a separate agreement that shall establish a lease for one dollar ($1.00) allowing Mendota Heights to continue storage of equipment in the column of the Tank. Said lease shall identify the responsibilities and obligations of both Mendota Heights and the Board concerning equipment storage. page 67 As part of said lease, Mendota Heights will be responsible for maintenance of the grounds including turf and roadway access to the tank within the easement conveyed to the Board. ARTICLE VII Section 1.RIGHT-OF-WAY Allexpenses or costs accruing to the water system in Mendota Heights, which result from the maintenance, reconstruction, grinding, overlaying, or paving of public streets, alleys, or rights-of-way resulting from the action of Mendota Heights, County of Dakota, or State of Minnesota, shall be the responsibility of Mendota Heights. Changes proposed by Mendota Heights, County of Dakota, or State of Minnesota to the elevation of public streets, alleys, or rights-of-way where water system facilities are situated shall be reviewed and approved in advance by the Board. The Board and Mendota Heights agree that the Board’s standards pertaining to elevation changes, grades, and earth cover over water system facilities shall apply to all said elevation change proposals. Where elevation changes are greater than the parameters outlined in the Board’s standards, allexpenses or costs accruing to the water system in Mendota Heights shall be the responsibility of Mendota Heights. Section 2.ACCESS TO INFRASTRUCTURE Mendota Heights shall allow the Board uninterrupted access to all water mains, hydrants, service connections, tanks, and appurtenances within the public streets, alleys, or rights-of-way under the jurisdiction of the City of Mendota Heights. Section 3.PUBLIC WATER MAIN EASEMENTS Mendota Heights warrants that all public water mains and appurtenances outside public street rights-of-way are situated withinperpetualeasements guaranteeing access rights for the purpose of maintenance, repair, or replacement of such mains and appurtenances. ARTICLE VIII Section 1. BOARD TO FURNISH METERS page 68 The Board shall furnish, install, retain title to, and maintain all water meters required by the Board for its domestic and commercial water service accounts to properties located within the City of Mendota Heights. Section 2.BILLING AND COLLECTION The Board shall have full responsibility for reading water meters and billing and collection of accounts, pursuant to the rules, regulations, statutes, and policies of the Board. Mendota Heights shall immediately adopt an ordinance giving the Board authority to certify past due billed charges to Dakota County for collection with property taxes. Any unpaid bills shall become a continuing lien on the property. Mendota Heights shall indemnify, defend, and hold harmless the Board against any claim, action or lawsuit brought to dispute any such certification or unpaid bill. Upon receipt by Mendota Heights or the Board of such claim, action, or lawsuit, Mendota Heights shall reimburse the Board the full amount of the disputed certification to the extent Mendota Heights has received those funds. Section 3.OPTIONAL BILLING ANDCOLLECTION SERVICES Mendota Heights may choose to have the Board perform additional billing services (for example; sanitary seweror storm waterbilling). If Mendota Heights makes this selection, the parties shall execute a written addendum to this Agreement, which shall specify the responsibilities of each party with regards to such additional billing services. Section 4.WATER SURCHARGE Mendota Heights has established a water surcharge equal to ten percent (10%) of the charge imposed for water supplied to properties within the City of Mendota Heights (“Mendota Heights Water Surcharge”). Mendota Heights will pay the Board a monthly payment equal to two percent (2%) of the total monthly Mendota Heights Water Surchargecollections. The Board will send a monthly payment to Mendota Heights equal to the amount of collections received during the month (less the two percent (2%) for billing and collection) on or th before the 15 day of the following month. Section 5.BILLING INSERTS page 69 Mendota Heights may provide materials to be inserted with the water bills of customers located within Mendota Heights, with the prior approval of the Board, at a reasonable charge to Mendota Heights for the cost of such bill-stuffing process. Said material shall not cause the mailing to exceed the postal weight limit. ARTICLE IX Section 1.SUPPLEMENTAL WATER SUPPLY No supplemental supply of water shall be connected to the water system being served by the Board without the prior written approval of the Board. This Agreement shall not preclude Mendota Heights from obtaining a portion of its water from any source approved by the Minnesota Department of Health in areas where water supply from the Board is impractical or unworkable, or in case a central water supply system is constructed and installed for a housing development prior to the extension of water mains supplying the area with water provided by the Board. However, in no case shall there be direct connections between the Board’s supply system and other supply systems, and when the Board’s supply system is practical and workable, the other supply shall be discontinued and disconnected, at no cost to the Board. Existing private wells are exempted from this requirement, but no direct connection to the Board’s supply shall be permitted. ARTICLE X Section 1.RULES AND REGULATIONS. The use and distribution of water in Mendota Heights derived from the supply furnished from the Board shall at all times be governed by rules, regulations, policies, and conditions which the Board has heretofore adopted for the City of Saint Paul, or which it may hereafter adopt concerning the preservation, regulation, and protection of its water supply, including water waste, water conservation, sprinkling restrictions and water use for air conditioning equipment; and as more fully detailed in the most recent version of “Title XI –Water Utility, Legislative Code of the City of Saint Paul” and “Saint Paul Regional Water Services Standards for the Installation of Water Mains”. page 70 Mendota Heights shall enact such rules, regulations, policies, and conditions into ordinances, make them legally effective and binding, and shall provide the Board with copies thereof. Within sixty (60) days after the effective date of this Agreement Mendota Heights shall also enact any amendments thereto adopted by the Board within sixty (60) days after being notified of such adoption, and shall adopt suitable penalties for the violation of rules, regulations, policies, and conditions, and shall strictly enforce such rules, regulations, and requirements. Section 2.BOARD’S JURISDICTION IN MENDOTA HEIGHTS It is further agreed that the Board, through its officers, agents, and employees, shall have the same authority and jurisdiction in the enforcement of such rules and regulations in Mendota Heights that the Board has in the City of Saint Paul. Section 3.MENDOTA HEIGHTS’ PERMITTING AUTHORITY Mendota Heights does issue permits to other governmental and private agencies for the installation of natural gas, telephone, cable, and other facilities. Mendota Heights shall cooperate with the Board to assure no location conflicts occur. Mendota Heights shall cooperate to the fullest extent possible in protecting the water system by ensuring facility installation, replacement or repair is permitted in strict accordance with the Board’s standards and performing the terms and conditions of this Agreement. ARTICLE XI Section 1.HYDRANTS Hydrant use for purposes other than firefighting by Mendota Heights shall be subject to the same rules and regulations applied by the Board in the City of Saint Paul. Mendota Heights Fire Department requires hydrants with one (1) large and two (2) small nozzles, and the Board shall maintain the water system with this type of hydrant. Section 2.INSPECTION OF HYDRANTS Board forces shall perform an annual inspection of all standard public hydrants in Mendota Heights. Repair and maintenance work, except for painting, required on all standard page 71 public hydrants in Mendota Heights shall be performed by Board forces in the same manner as that same work is performed in the City of Saint Paul. Section 3.PAINTING OF HYDRANTS Mendota Heights shall paint all public hydrants in Mendota Heights, and shall do so in accordance with the Board’s established standards for such work. Mendota Heights shall notify Board staff of its schedule to perform such painting prior to commencement. Mendota Heights may designate a hydrant cap color code to distinguish dead end mains, circulating mains, and other selected criteria. Section 4.HYDRANT NOZZLE THREADS The Board recognizes the Saint Paul Standard for hydrant nozzle threads as selected by Mendota Heights for hydrants within the city of Mendota Heights. All new and replacement hydrants shall include one Storz connection. Section 5.RELOCATIONS AND ADJUSTMENTS Where relocations or adjustments of hydrants are necessary due to public works projects, or for other reasons, Board forces shall perform the required work and Mendota Heights shall reimburse the Board for all costs and expense thereof. Section 6.FIRE USE In consideration for Mendota Heights’ agreement to paint all standard and non-standard hydrants, the Board shall not charge Mendota Heights for water used for municipal firefighting and fire equipment testing. Section 7.STREET CLEANING Mendota Heights agrees to keep a record of all water used for street sprinkling, street flushing, sewer maintenance, and/or any related uses and to pay for the same annually to the Board. Section 8.LOCATION MARKERS page 72 Where it is necessary for the location of hydrants to be marked with flags, signage, etc. for firefighting or other purposes, Mendota Heights shall pay for said markers and assume the costs thereof, including installation, maintenance, and liability. Section 9.SNOW REMOVAL Any snow removal from and around fire hydrants for any purpose shall be performed by Mendota Heights at its sole expense. Section 10.HYDRANT SPACING Mendota Heights has reviewed the hydrant spacing throughout the water system and has determined that the current hydrant spacing is adequate. Hydrants with a spacing of greater than 700 feet are listed in Exhibit “G”, attached hereto and incorporated herein. The cost of future changes to hydrant spacing requested by Mendota Heights shall be borne in total by Mendota Heights. When requested by the Board, the cost to provide hydrant spacing reduction shall be borne in total by the Board. ARTICLE XII Section 1.AGREEMENT AMENDMENTS Mendota Heights and the Board agree that from time to time changes to this Agreement may be necessary. Mendota Heights and the Board agree that said changes shall be in the form of written addendums to this Agreement and shall be valid only when duly approved by and executedon behalf of the respective parties. ARTICLE XIII Section 1.NOTICES In the event that Mendota Heights should deem that the Board has failed in its obligations to supply an adequate water supply and normal maintenance of the facilities, or should find cause that the Board is failing in its provision of services, Mendota Heights shall notify the Board in page 73 writing, setting forth the specific details of any such claim of failure(s). Notices shall be sent by certified mail to the parties at the following addresses: Mendota Heights City Administrator 1101 Victoria Curve Mendota Heights, MN 55118 General Manager Board of Water Commissioners 1900 Rice Street Saint Paul, MN 55113 Section 2. CORRECTIVE ACTION Board shall undertake to correct the claimed failure(s) within sixty (60) days from the date it receives said written notification. The Board shall notify Mendota Heights in writing within the specified sixty (60) day period what necessary corrective actions have been taken, if any, and any explanation if the Board disagrees with Mendota Heights’ claim of failure(s). Section 3.MEDIATION Following the specified sixty (60) day period, if Mendota Heights deems that sufficient corrective actions have not been taken, it may require that its claim of failure(s)be submitted to mediation by a panel of three (3) persons. Mendota Heights and the Board may each appoint a representative to the panel, and those two appointed representatives shall select the third member. The panel shall provide a reasonable opportunity to both Mendota Heights and the Board to express its opinions and facts regarding whether the Board is adequately and reasonably performing its obligations under this Agreement. By agreeing to this provision, neither party forfeits any rights it may have to fully pursue any claim to the fullest extent provided by law. Section 4.OPTION TO TERMINATE; FIVE-YEARNOTICE The mediation panel shall submit its written findings, conclusions, and recommendations to Mendota Heights and the Board within sixty (60) days after the parties’ presentation of facts. In the event the mediation panel should confirm Mendota Heights’ claim of failure, Mendota Heights may elect to terminate this Agreement by giving written notice to that effect to the page 74 Board. Notice of termination shall specify the effective date of termination, which in any event shall not occur until at least five (5) years following the date of election to terminate. Section 5.RECONVEYANCE; COMPENSATION Upon the effective date of termination of this Agreement, Board will reconvey title to the facilities previously conveyed by Mendota Heights pursuant to Article II, Section 6 of this Agreement for the sum of $1.00, and Mendota Heights will compensate the Board for depreciated value of all water service facilities, including water mains, hydrants, water tower, and other appurtenances, constructed by the Board to serve the Mendota Heights system from and after the date of the execution of this Agreement. – The remainder of this page left intentionally blank – page 75 Exhibit A Deficient Mains ON STREET LOCATION LENGTH COST/FT TOTAL COST BROMPTON PLSIBLEY MEMORIAL HWY TO 220' S238 $ 150.00 $ 35,700.00 APACHE ST 300' N OF CHEYENNE TO KEOKUK 1755 $ 150.00 $ 263,250.00 APACHE ST KEOKUK TO PUEBLO770 $ 150.00 $ 115,500.00 AZTEC LN100' N OF CREEK TO HOKAH 1140 $ 150.00 $ 171,000.00 AZTEC LNHOKAH TO CUL-DE-SAC310 $ 150.00 $ 46,500.00 CHEYENNE LN 200' E OF PONTIAC PL TO APACHE ST1250 $ 150.00 $ 187,500.00 CREEK AVE AZTEC TO DODD 750 $ 150.00 $ 112,500.00 DECORAH LNPUEBLO TO PONTIAC760 $ 150.00 $ 114,000.00 EASEMENT 629 FOX TO DODD 325 $ 150.00 $ 48,750.00 FOX PL CREEK TO AZTEC 800 $ 150.00 $ 120,000.00 HOKAH AVE AZTEC TO DODD 325 $ 150.00 $ 48,750.00 KEOKUK LN PUEBLO LN TO APACHE850 $ 150.00 $ 127,500.00 KEOKUK LN W OF PUEBLO DR 100 $ 150.00 $ 15,000.00 KEOKUK LN APACHE TO PUEBLO DR450 $ 150.00 $ 67,500.00 MOHICAN CTPUEBLO LN TO 450' S450 $ 150.00 $ 67,500.00 MOHICAN LNPUEBLO LN TO PUEBLO DR 900 $ 150.00 $ 135,000.00 NAVAJO LN PONTIAC TO PUEBLO650 $ 150.00 $ 97,500.00 OCALA LNPONTIAC TO 200' E 350 $ 150.00 $ 52,500.00 PONTIAC PL CHEYENNE TO APACHE ST 1200 $ 150.00 $ 180,000.00 PUEBLO DRKEOKUK TO MOHICAN275 $ 150.00 $ 41,250.00 PUEBLO DRS OF MOHICAN 150 $ 150.00 $ 22,500.00 PUEBLO LN DECORAH TO MOHICAN 1100 $ 150.00 $ 165,000.00 PUEBLO LN S OF MOHICAN 150 $ 150.00 $ 22,500.00 DECORAH LNINTERSECTION OF APACHE ST 40 $ 150.00 $ 6,000.00 EASEMENT 649 AZTEC TO APACHE 600 $ 150.00 $ 90,000.00 EASEMENT 450 INTERMEDIATE EASEMENT 400 $ 150.00 $ 60,000.00 TOTAL LENGTH 16088 $ 2,413,200.00 page 76 Exhibit B Excessive Depth ON STREET LOCATION LENGTHCOST EASEMENT 568 EASEMENT 568-3 TO EAGLE RIDGE580 $ 7280.00 DELAWARE AVE DODGE TO HUBER 2250 $ 93,275.00 TOTAL LENGTH 2335 $ 100,555.00 page 77 Exhibit C Non-conforming Easements 1.North of Diane Rd from Wachtler Rd to Victoria Rd East/west section through trees and brush, with a creek and difficult slopes $97,500.00 2.BetweenDeer Trail Ct and Deer Trail Ptcul-de-sacs Through private property of 825 Deer Trail PT., with trees and difficult access $25,000.00 3.Eagle Ridge Townhomes Through private yards and driveways, difficult access between buildings and retaining walls $104,400.00 4.Southerly portion of 1500 Commerce Dr Under storm water pond $41,600.00 5.Between Field Stone Ct and Pond Circle cul-de-sacs Through private yards and driveways with difficult access to middle section $14,150.00 6.North of Highway 110 between Crown Point Dr and Wachtler Ave Through a wetland $369,000.00 7.North from Glenhill Rd cul-de-sac to 1889 Hunter Ln Through private properties with large trees and landscaping $49,500.00 TOTAL $701,150.00 page 78 Exhibit D Services with a history of freezing ADDRESS COST COUNT YEAR 1016 WINDWOOD CT $2,500.00 12014 1046 LONDON RD $2,500.00 22014 1070 CHIPPEWA AVE $2,500.00 11977 1105 DODD RD $2,500.00 22014 1415 DODD RD $2,500.00 11977 1483 DODD RD $2,500.00 12014 1516 VANDALL ST $2,500.00 11991 1665 S LEXINGTON AVE $2,500.00 11994 1818 FARO LN $2,500.00 11977 1818 TWIN CIRCLE DR $2,500.00 12014 1821 TWIN CIRCLE DR $2,500.00 21979 2330 APACHE ST $2,500.00 12014 2330 ROGERS AVE $2,500.00 31978 2331 APACHE ST $2,500.00 12014 2350 PUEBLO DR $2,500.00 12014 552 MIRIAM ST $2,500.00 21979 596 MAPLE PARK DR $2,500.00 12014 6 BEEBE AVE $2,500.00 32014 601 W EMERSON AVE $2,500.00 12014 614 W BUTLER AVE $2,500.00 21979 654 1ST AVE $2,500.00 11977 668 1ST AVE $2,500.00 12014 678 3RD AVE $2,500.00 11977 685 CALLAHAN PL $2,500.00 11971 720 W WENTWORTH AVE $2,500.00 12014 731 KEOKUK LN $2,500.00 12014 743 KEOKUK LN $2,500.00 12014 TOTAL$80,000.00 page 79 Exhibit E Site Lease page 80 Exhibit F Antennae Revenue $346,110.67 page 81 Exhibit G Hydrant Spacing LOCATIONLOCATIONSPACING HWY 13 / EUGENIA HWY 13 / GARDEN 700' HIAWATHA / GARDEN CHIPPEWA / HIAWATHA 750' SIMARO CHIPPEWA / MIRIAM 800' KIRCHNER / BUTLER ESTHER LN / BUTLER 750' CHIPPEWA / JOHN ESTHER LN / BUTLER 800' JUNCTION LN CHIPPEWA / JUNCTION800' CHIPPEWA / JOHN CHIPPEWA / DODD 900' DELAWARE / DODDCHIPPEWA / DODD 1000' SYLVANDALE / ARCADE SYLVANDALE730' SYLVANDALE / ARCADIA CASCADE LN / ARCADIA 740' BEEBE CHIPPEWA / DODD 800' SOMERSET / EMERSON HINGHAM / EMERSON 950' FIRST / CLEMENT CLEMENT / THIRD 750' EMERSON / DODD FIRST / DODD 800' WENTWORTH / DODD FOURTH / DODD850' BACHELOR / DODD DODD / EVERGREEN 750' DODD / EVERGREEN WENTWORTH / DODD 750' JAMES RD JAMES RD / DOUGLAS 700' LILAC VICKI LN 800' HIGHVIEW CIR/VICTORIA DOUGLAS / VICTORIA750' MARIA / CALLAHAN MARIE 730' MARIE AVE / WARRIOR DRMARIE AVE / NATURE WAY 740' MARIE AVE / WARRIOR DRMARIE AVE WEST OF WARRIOR 720' LEXINGTON/ORCHARD PL LEXINGTON/ORCHARD HILL 730' WILLOW LN/VALLEY CURVE VALLEY CURVE /WACHTLER 900' GLENHILL /VICTORIA CURVE HUNTER /VICTORIA CURVE 800' VAIL DR LEXINGTON / VICTORIA 750' KAY / WALSHVICTORIA / SUMMIT750' VICTORIA RD LEXINGTON / VICTORIA 1000' FRONTAGE RDSOUTH FREEWAY/FRONTAGE 1000' OAK ST / MARKET ST MENDOTA RD W / SOUTH LN 700' WARRIOR / SIBLEY CT FRONTAGE RD 800' LEXINGTON/CENTRE POINTE CURVETOM THUMB / LEXINGTON740' PILOT KNOB / ACACIA PILOT KNOB / ACACIA 800' CREEK / DODD AZTEC / CREEK 800' DEL CT DELAWARE / DEL CT 800' LEXINGTON / WAGON LEXINGTON 800' DODD RD WAGON WHEEL / DODD 800' PONTIAC / NAVAJO APACHE / DECORAH900' LEXINGTON LEXINGTON 850' LAKE DRSWAN / LAKE DR 730' APACHE / PUEBLO APACHE / KEOKUK800' page 82 4. *´¤ Α9Ǿ ΑΏΐΔ DATE: TO: - ¸®± £ #¨³¸ #®´¢¨« FROM: 3«® 7 ««¦±¤Ǿ 2¤¢±¤ ³¨® 0±®¦± ¬ #®®±£¨ ³®± - ±ª -¢.¤¨««Ǿ #¨³¸ !£¬¨¨²³± ³®± SUBJECT: $®¦ 0 ±ª &´£¨¦ǉ ,¨¢¤²¨¦ Introduction: !² ¥®««®¶-´¯ ³® ³§¤ #®´¢¨«Ȍ² £¨±¤¢³¨µ¤² ³ ³§¤ - ¸ ΐΑ ¶®±ª²§®¯Ǿ ® *´¤ ΑΒǾ ³§¤ 0« ¨¦ thrd #®¬¬¨²²¨® ¶¨«« ¢®²¨£¤± ¢³¨® ³® ««®¶ ¥®± ¨³¤±¨¬ ´²¤ Ȩ ³¨¢¨¯ ³¤£ ¥¨µ¤ ¸¤ ±²ȩ ®¥ ³§¤ 0¨«®³ +®¡ ²¨³¤ ¥®± £®¦ ¯ ±ªȁ /¤ ®³§¤± £¨±¤¢³¨µ¤ ¶ ² ³® £¤³¤±¬¨¤ ²®´±¢¤ ®¥ ¥´£¨¦ ¥®± ¨³² development. Background: +®¶¨¦ ³§¤ ²¨¦¨¥¨¢ ¢¤ ®¥ 0¨«®³ +®¡ ³® ³§¤ $ ª®³ ¯¤®¯«¤²Ǿ ¶¤ £¨£ ¢®³ ¢³ ¡®³§ ³§¤ #§ ¨± ®¥ ³§¤ -¤£®³ -£¤¶ ª ³® ³±¨¡¤Ǿ £ ³§¤ 0¨«®³ +®¡ 0±¤²¤±µ ³¨® !²²®¢¨ ³¨®ȁ 7¤ ¤·¯« ¨¤£ ³§ ³ ³§¤±¤ § ² ¡¤¤ £¨²¢´²²¨® ®¥ ³§¤ #¨³¸-®¶¤£ ²¨³¤ ¥®± ¨³¤±¨¬ £®¦ ¯ ±ª ´²¤ȁ )¥ ³§ ³ ´²¤ ²§®´«£ ¨³ ¯±®¢¤¤£Ǿ ¥¤¢¤ ¶®´«£ § µ¤ ³® ¡¤ ¨²³ ««¤£Ǿ ¶§¨¢§ ¶®´«£ ¨µ®«µ¤ ²®¬¤ £¨¦¦¨¦ ¥®± ¥¤¢¤ ¯®²³ §®«¤²ȁ 7§¨«¤ ³§¤±¤ ±¤ «®¦¤± ³¤±¬ ¨²²´¤² ³® ¡¤ ±¤²®«µ¤£ ±¤¦ ±£¨¦ ³§¤ ´«³¨¬ ³¤ ´²¤ ®¥ ³§ ³ ²¨³¤ Ȩ£¤µ¤«®¯¬¤³Ǿ µ¤±²´² ¯±¤²¤±µ ³¨® ®± ¨³¤±¯±¤³¨µ¤ ¢¤³¤±ȩǾ ´²¤ ² £®¦ ¯ ±ª ¥®± ³ «¤ ²³ ³§¤ ²§®±³ ³¤±¬—¶¨³§ ²´¦¦¤²³¤£ ³¨¬¤ ¥± ¬¤ ®¥ ¥¨µ¤ ¸¤ ±²--¶ ² ¢¢¤¯³ ¡«¤ ³® ³§¤¬ȁ Funding: !²²´¬¨¦ ³§ ³ £®¦ ¯ ±ª ´²¤ ¨² ³® ¡¤ ¯´±²´¤£Ǿ ³§¤ ¤²³¨¬ ³¤£ ¢®²³ ³® ¡´¨«£ ³¤¬¯®± ±¸ ¯ ±ª ³ 0¨«®³ +®¡ ¨² ¦®¨¦ ³® ¡¤ ±®´¦§«¸ ͡ΒΏǾΏΏΏȁ 4§¤ « ±¦¤²³ ¯ ±³ ®¥ ³§¨² ¨² ¥®± ¥¤¢¨¦Ǿ ¶§¨¢§ ¨² ±¤°´¨±¤£ ¡¸ ¢®£¤ ¥®± ³§¤ £®¦² ³® ¡¤ ®¥¥-«¤ ²§ȁ 7§¨«¤ ®³ ³¸¯¨¢ ««¸ ´²¤£ ¥®± ®-¯¤±¬ ¤³ ¯ ±ª expenditur¤²Ǿ ³§¤ 3¯¤¢¨ « 0 ±ª² &´£ ¨² ¯®²²¨¡¨«¨³¸ ¥®± ¥´£ing. !®³§¤± ¯®²²¨¡«¤ ²®´±¢¤ ®¥ ¥´£¨¦ ¥®± ³§¨² ¯±®©¤¢³ ¶®´«£ ¡¤ from ³§¤ '¤¤± « &´£ ±¤²¤±µ¤²ȁ 4§¤±¤ ¶®´«£ ¡¤ ®¯¯®±³´¨³¸ ³® ±¤¢®µ¤± ²¬ «« ¯®±³¨® ®¥ ³§¤ ¢®²³² ²²®¢¨ ³¤£ ¶¨³§ ¡´¨«£¨¦ £®¦ ¯ ±ª ³§±®´¦§ £®¦ licen²¤ ¥¤¤²ȁ S³ ¥¥ § ² ¨¢«´£¤£ «¨²³ ®¥ ¥¤¤² ³§ ³ ¤ ±¡¸ ¢¨³¨¤² ±¤ ¢§ ±¦¨¦ ¥®± £®¦ «¨¢¤²¤ ¥¤¤² £ £®¦ ¯ ±ª «¨¢¤²¤ ¥¤¤²ȁ 9¤ ±«¸ $®¦ ,¨¢¤²¤ City Fee9¤ ±«¸ $®¦ 0 ±ª ,¨¢¤²¤ &¤¤ page 83 -¤£®³ (¤¨¦§³²͡Δ ¯¤± ¸¤ ±.® $®¦ 0 ±ª 3³ȁ 0 ´« ͡ΐΐ ¯¤± ¸¤ ±.® $®¦ 0 ±ª &¤¤² Minneapolis ͡ΑΔ ¯¤± ¸¤ ±͡ΒΔ ±¤²¨£¤³²ȝ͡ΕΏ ®±¤²¨£¤³² 3®´³§ 3³ȁ 0 ´«͡Δ ¯¤± ¸¤ ±͡ΑΏ ±¤²¨£¤³²ȝ͡ΒΏ ®±¤²¨£¤³² Eagan ͡ΑΏ ¯¤± ¸¤ ±͡ΑΏ ±¤²¨£¤³²ȝ͡Γΐ ®±¤²¨£¤³² )µ¤± '±®µ¤ (¤¨¦§³² ͡ΐΑ ¯¤± ¸¤ ± .® $®¦ 0 ±ª 7¤²³ 3³ȁ 0 ´« ͡ΐΔ ¯¤± ¸¤ ±.® $®¦ 0 ±ª $ ª®³ #®´³¸ .® ¥¤¤² ͡ΓΒ ¯¤± ¸¤ ± .®³¤ ³§ ³ ³§¤ #¨³¸ ®¥ -¤£®³ (¤¨¦§³² £®¤² ¢§ ±¦¤ ͡ΐΏ ³® «¨¢¤²¤ ´²¯± ¸¤£ȝ´¤´³¤±¤£ £®¦²Ǿ ¡´³ ³§¤±¤ ±¤ ®«¸ § £¥´« ®¥ ³§¤²¤ ¨²²´¤£ȁ (®¶¤µ¤±Ǿ ³§¤±¤ ¶¤±¤ ®«¸ ΐΗΕ £®¦ «¨¢¤²¤² ¨²²´¤£ ¨ ΑΏΐΓǾ ¶§¨¢§ ¦¤¤± ³¤£ ͡ΐΐΐΔȁ /¯³¨®²Ȁ 3³ ¥¥ § ² ¨£¤³¨¥¨¤£ ³§±¤¤ ¯®²²¨¡«¤ ®¯³¨®² ±¤¦ ±£¨¦ «¨¢¤²¨¦ ¥®± ³§¤ £®¦ ¯ ±ªȁ /¯³¨® ͰΐȀ )¢±¤ ²¤ «« £®¦ «¨¢¤²¤ ¥¤¤² ¥±®¬ ͡Δ ³® ͡ΐΏȁ )¥ «« ¢´±±¤³ «¨¢¤²¤² ±¤ ±¤¤¶¤£Ǿ ³§¨² wou«£ ¯±®£´¢¤ £ ££¨³¨® « ͡ΐΐΐΔ¥±®¬ «¨¢¤²¤ ¥¤¤² ¯¤± ¸¤ ± ¥®± ££¨³¨® « ͡ΔΔΖΔ ®µ¤± ³§¤ ¤·³ ¥¨µ¤ ¸¤ ±²ȁ 7¤ ¢®´«£ ¬ £ ³¤ ®±¤²¨£¤³² ³® ¯´±¢§ ²¤ £®¦ ¯ ±ª «¨¢¤²¤ ¥®± ͡ΑΔǾ ¡´³ ³§ ³ ¶®´«£ ±¤°´¨±¤ £®¦ ¯ ±ª monitoringȁ /¯³¨® ͰΑȀ +¤¤¯ ³§¤ £®¦ «¨¢¤²¤ ¥¤¤² ³ ͡ΔǾ £ ²¤«« ²¤¯ ± ³¤ «¨¢¤²¤ ¥®± ³§¤ £®¦ ¯ ±ª ¥®± ͡ΑΏȁ )¥ § «¥ ®¥ ®´± «¨¢¤²¤£ £®¦ ®¶¤±² ¯´±¢§ ²¤ £®¦ ¯ ±ª «icenseǾ ³§¨² ¶®´«£ ¯±®£´¢¤ ¯¯±®·¨¬ ³¤«¸ $2000 ¨ ££¨³¨® « ±¤µ¤´¤ ¯¤± ¸¤ ±ȁ 4§¤ #¨³¸ ¢®´«£ «²® ±¤°´¨±¤ «« ®±¤²¨£¤³² ³® ¯´±¢§ ²¤ £®¦ ¯ ±ª «¨¢¤²¤ ¥®± ͡ΑΔȁ 4§¨² ¶®´«£Ǿ §®¶¤µ¤±Ǿ ±¤°´¨±¤ ¬®¨³®±¨¦ ¥®± ¢®¬¯«¨ ¢¤ ¡¸ ¤¨³§¤± ³§¤ 0®«¨¢¤ $¤¯ ±³¬¤³Ǿ ®± ¡¸ ³§¤ #¨³¸Ȍ² ¢®³± ¢³¤£ ¨¬ « ¢®³±®« ¢®¬¯ ¸ȁ 4® £® ³§¤ « ³³¤±Ǿ §®¶¤µ¤±Ǿ ¶®´«£ «¨ª¤«¸ ¡¤ ³ ££¨³¨® « ¢®²³Ǿ ³§´² ±¤£´¢¨¦ ³§¤ ¤³ ££¨³¨® « ¨¢®¬¤ȁ /¯³¨® ͰΒȀ $® ®³ ¢§ ±¦¤ ¸ ££¨³¨® « ¥¤¤² ¥®± ³§¤ £®¦ ¯ ±ªȁ Recommendation: /¯³¨® ΐ ¶®´«£ ¡¤ ³§¤ ¤ ²¨¤²³ ³® ¨¬¯«¤¬¤³ ¨¥ ¶¤ ±¤ ³® ¦¤¤± ³¤ ££¨³¨® « ¥´£²Ǿ ¡´³ ³§¨² ¶¨«« ¬¤ ³§ ³ ®³§¤± ¥´£² ¶¨«« ¤£ ´¯ ²´¡²¨£¨¹¨¦ ³§¤ ¢®²³²Ǿ ²§®±³ £ «®¦ ³¤±¬ȁ !¢³¨® 2¤°´¨±¤£ #®´¢¨« ²§®´«£ ²¤«¤¢³ ®¤ ®¥ ³§¤ ¡®µ¤ options ¡¸ ¬®³¨®ȁ page 84 5. DATE: June 29, 2015 TO: Mayor, City Council and City Administrator FROM: Nolan Wall,AICP Planner SUBJECT: City-owned Properties at the Villageat Mendota Heights BACKGROUND Following discussion at the May Council workshop, staff was directed to draft a Letter of Intent(LOI) and to reach-out to local restaurateurs. Letter of Intent The DRAFT Letter of Intent is attached for review and comment. The purpose of the letter is to inform developers about the opportunity and convey the City’s vision in an effort to create a partnership to develop the site. Staff is looking for guidance on the content of the letter and timelines for submission and review. Restaurateurs As there was interest expressed at the previous workshopby some of the City Council for a sit-down restaurant on the vacant lots, the Council directed staffto meet with local residents who are restaurant owners to gather their thoughts as to the feasibility of that type of business there. Following up on the recommendations of several Councilors, six owners were contacted. Unfortunately, only one has beenable to meet to discuss. That meeting will take place on Friday, June 26and will be shared with the Council at the workshop. BUDGET IMPACT The Letter of Intent can be administered by staffand the sale of the lots could be used to invest in infrastructure improvements to support the development vision. RECOMMENDATION Staff recommendsdiscussion onthe DRAFT Letter of Intent anddirection on the timing of the next steps in the process. page 85 1 Letter of Interest for Development Partner 2 Village at Mendota Heights – City-owned Parcels 3 4 5 Objective 6 7 8 The City of Mendota Heights is seeking a real estate development partner to collaborate on a plan to develop the last 9 remaining vacant parcels within the Village at Mendota Heights. It is important to the City that the parcels be developed 10 in synergy with the existing development while being positioned for success in the marketplace. 11 Background 12 13 14 Mendota Heights is a premier suburb located in northern Dakota Countyalong the bluffs surrounding the Minnesota and 15 Mississippi Rivers which features high-quality residential and business developments. The City is well-positioned just 16 minutes south of both downtown St. Paul and Minneapolis with convenient access to the regional highway system and 17 MSP International Airport. 18 19 The Village at Mendota Heights is an award-winning 23-acre mixed use development located at the northeast quadrant 20 of the Dodd Road (MN State Highway 149)/MN State Highway 110 intersection. The development contains the following 21 uses and amenities (see Exhibit A): 22 23 Diverse mix of retail/office space (single and two-story) 24 On-street and underground public parking facilities (approximately 400 spaces) 25 36-unit condominium building 26 ## row homes 27 60-unit senior apartments (owned and operated by the Dakota County CDA) 28 Market Square Park 29 30 The Final Planned Unit Development (PUD) Plan was approved in 2002-2003 and constructed in phases. The city-owned 31 parcels were designated as “row homes” in the Final PUD (see Exhibit B) and include the following: 32 Parcel ID Plat Description Size (acres) Estimated Value* 27-48335-03-020Lot 2, Block 30.79$183,500.00 27-48335-03-010 Lot 1, Block 3 0.48 $178,300.00 27-48335-02-010 Lot 1, Block 2 0.45 $314,700.00 33 *Source: Dakota County Assessor (2014) 34 35 The entire Village at Mendota Heights development is zoned Mixed Use-PUD. The City is open to considering a change in 36 use or density from the approved plans which may require an amendment to the Final PUD Plan in compliance with Title 37 12, Chapter 1, Article K of the City Code and approval by the City Council. 38 page 86 Development Vision 39 40 41 The City Council has informally discussed the intended vision for development of the city-owned parcels at recent 42 workshops. At this time, the City is soliciting interested development partners for the following development scenarios: 43 44 1.Townhouse/Row House Units (owner-occupied) 45 2.Condominium Units 46 3.Sit-down Restaurant 47 Submittal Requirements 48 49 50 Interested partners should submit a letter of interest (10-page limit) including the following information: 51 52 1.Name, address, telephone number, and email addresses of the project team. 53 2.Brief resumes and roles of key personnel, including relevant experience partnering with government agencies. 54 3.Project examples, preferably demonstrating successful public/private partnerships. 55 4.General statement of interest in a partnership with the City to implement a shared vision. 56 5.Concept Plan that identifies a preliminary site layout based on the intended use of the parcels. 57 6.Preliminary work plan that outlines key steps and timelines in the development process. 58 7.Any additional information that should be considered in evaluating the proposal. 59 60 An electronic copy and ten (10) hard copies must be submitted by 4:30 PM on Day, Month ##,2015 to: 61 62 City of Mendota Heights 63 ATTN: Nolan Wall, City Planner 64 1101 Victoria Curve 65 Mendota Heights, MN 55118 66 67 nolanw@mendota-heights.com 68 Selection 69 70 71 All complete submittals received prior to the deadline will be reviewed by the City Council. Submittals will be evaluated 72 based on professional capabilities and demonstrated experience partnering with local governments to develop successful 73 projects based on a shared vision. The City will determine which respondents, if any, to invite for follow-up interviews 74 and presentations before the City Council in Month or Month. 75 76 The City intends to select a “Development Partner” for the parcels by Month, 2015 and enter into a pre-development 77 agreement as soon as possible thereafter to begin the development process. 78 Terms 79 80 81 The request for Letters of Interest in no way obligates the City to enter into a contract with any respondent; nor does it 82 limit the City from entering into a contract with an entity that does not respond to this request. Furthermore, the City 83 may pursue discussions with one or more respondent to this request, or none at all, and reserves the right, without 84 prejudice, to reject any and all responses and at any time without notice and without cause. The City will not reimburse 85 the respondent for expenses incurred in response to this Letter of Interest. 86 87 Questions regarding this Request for Interest can be directed to Nolan Wall, City Planner at 651.255.1142 or 88 nolanw@mendota-heights.com or Mark McNeill, City Administrator at 651.255.1153 or markm@mendota-heights.com. page 87 EXHIBIT A: City of Village at Mendota Heights Mendota 1.72 Acres - Zoned MU-PUD 0180 Heights Date: 6/25/2015 SCALE IN FEET 1888 1887 696 700 LAND USES 780 1894 1899 City Lots 755 699 Condominiums 745 Senior Housing Row Houses H I L L T O P R D Office-Retail 750 764 1925 Office Retail 1933 Park 1937 ST MAPLE 1941 702 697 1938 765 1944 R ID G E P L 772 750 698 698 720 730 740 1960 HW Y 110 Aerometrics GIS Map Disclaimer: This data is for informational purposes only and should not be substituted for a true title search, property appraisal, plat, survey, or for zoning verification. The City of Mendota Heights assumes no legal responsibility for the information contained in this data. The City of Mendota Heights, or any other entity from which data was obtained, assumes no liability for any errors or omissions herein. If discrepancies are found, please contact the City of Mendota Heights. Contact "Gopher State One Call" at 651-454-0002 for utility locations, 48 hours prior to any excavation. page 88 page 89 6. DATE: June 29, 2015 TO: Mayor and City Council FROM:Mark McNeill, City Administrator SUBJECT:CityLegislative Platform COMMENT: INTRODUCTION: th At the City Council workshop of June 29, the Council will be asked to discuss the adoption of a series of positions which are of special interest to the City, and would be action for which they would like action to be taken. BACKGROUND: Interest has been expressed to me regarding possible action by the 2016 Minnesota legislature for the following issues: Fiscal Disparities Transportation Group Homes Special Legislation Issue Discussion: Fiscal Disparities—Fiscal Disparities is a revenue sharing program which was adopted by the Legislature in the early 1970’s as a way to somewhat balance the benefits of commercial and industrial development between older communities, versus newer ones. Because Mendota Heights developed much of its commercial/industrial tax base after the adoption of the law, and because its community demographics—household income, age of housing stock, and a host of other variables which go into the Fiscal Disparities formula--are what they are, the City has always been a net contributor to the Fiscal Disparities pool. page 90 See the attached information, including a description of the law, and the most recentavailable for the Mendota Heights net contributions to FD over the past 10 years. Note that these are just the contributions by the City; ISD 197 and Dakota County are also impacted by the law. If there is a desire to more proactively pursue changes to the Fiscal Disparities law nextyear, the Council may direct staff to propose funding for advocacy groups or lobbyists in the 2016 budget. Transportation—Asit is a first-ring suburb, Mendota Heights transportationissues in Mendota Heights impact not only its residents and businesses, but regional stakeholders as well Transportation funding is a perennial battle for the Legislature, be it metro vs. outstate; highways vs. mass transit, and the attendant funding options (gas tax, bonding, Motor Vehicle Excise Tax, etc). The projected shortfall of maintenance dollars over the next decades is significant, and is even greater when factoring in the needs for improvements for safety and congestion relief. Discussion has started on the “Zip Line” high-speed rail, which would run between MSP Airport or Union Station, and Rochester, along the US 52 corridor. The City is monitoring this, however, is a long term issue, and shouldn’t be part of a 2016 Legislative platform. There may be other mass transit or highway issues as well. The Council should discuss, and give direction as to what transportation projects it sees as a priority. Group Homes: One of the issues identified by law enforcement which is impacting the quality of life in many Minnesota communities is the recent trend of private parties purchasing larger homes or apartment buildings, and then rentingspace to state-subsidized at-risk individuals. The result is a significant increase in calls for public safety services, and oftena change in the character of the neighborhood. A recent Supreme Court ruling (the Olmstead Decision) has made it even more difficult for local jurisdictions to place reasonable limits on this type of housing. In the 2015 session of the legislature, some of our Dakota County neighbors—spearheaded by Burnsville—have sought to have the legislature allow for more local control. Their efforts met with no success, in 2015, but this grouping is a vehicle for possible Mendota heights participation in 2016. Special Legislation: Special pension legislation wasrequested by one Mendota Heights city employee in the 2015 session for that employee’s individual circumstance, but it did not receive a hearing. It would need to be re-introduced in 2015. The Council will need to discuss the financial implications of thatrequest for next year’s budget. Ifthe financial part is able to be met, the City will need to lend support to the special pension legislation. One of Mendota Heights’ state elected officials urged the City to look at needs for the 2016 session, as it is a bonding year. If a unique situation can be identified, there may be an page 91 opportunity to get special legislation through that benefits the City. One possibility are the frontage roads along TH 110, which were turned back to the City by the State many years ago in substandard condition. The Public Works Director and I will explore this, and other possibilities, for special legislative consideration. IMPLEMENTATION STRATEGIES: With anycontemplated legislative change, there are usually three options available to change a law: 1.Go It Alone—The City would seek changes to a law which are specific to Mendota Heights. 2.Form a Consortium—The City would identify other cities in similar situations, and work jointly to make a modification. 3.Go through established organizations—Work throughan established advocacy group such as Metro Citiesor the League of Minnesota Cities. Identifying a Legislative Platform is a first step—it allows the city to go on record withthe issues it would like to see changed. However, the bigger problem is how to get those desired law changes implemented—that buy-in from the Council, and resources, time and effort. Will there be an individual to champion the desiredchanges? Does the City want to form, or join a consortium of cities with similar interests? Or, should it work with established groups like Metro Cities or the LMC, groups which must balance the needs and preferences from a variety of cities? I look forward to the discussion. Mark McNeill City Administrator page 92 Fiscal Disparities 101 September 2014 Local government units within the Twin Cities metropolitan area, which is comprised of the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington, have participated in a property tax base sharing program known as Metropolitan Fiscal Disparities since 1975. A similar program began in 1996for local government units in the Taconite Area, which includes portions of the counties of St. Louis, Itasca, Crow Wing, and Aitkin, and all of Lake and Cook counties. Under these programs, a portion of the growth in commercial, industrial, and public utility property value of each community is contributed to a tax base sharing pool. Each community receives a distribution of property value from the pool based on the market value and population of each city. based on a distribution index. This index Contribution The contribution to the pool is equal to 40 capita to the average market value per capita percent of the growth in commercial, for all cities and towns in the seven counties. industrial, and public utility value since the Cities that have relatively less market value base year (1971 for the Twin Cities; 1995 for per capita receive a relatively larger the Taconite Area). This measure of growth distribution from the pool than cities with includes both new construction and greater market value wealth per capita. inflationary increases in existing property values. In 2013, for example, the total How are property taxes generated? amount of tax capacity contributed to the Metropolitan fiscal disparities pool was The tax capacity contributed to the pool $368.5million. The contribution value is not ultimately translates into property tax dollars available for local tax purposes and therefore, for each local government. These property the contribution value must be subtracted taxes, also known as the distribution levy, are from the total tax capacity of each computed for each local government by community before the local tax rate is multiplying its distribution value by its prior computed. The Taconite Area program is year tax capacity rate. The distribution levy much smaller, with just over $7.9million of represents the amount of each local tax capacity contributed in 2013. the fiscal disparities program. The balance of the certified levy is used to compute the local Distribution tax rate. The tax capacity contributed to the pool is page 93 How are commercial/industrial and main goals that encapsulate several of the original objectives: utility parcels taxed ? Promote orderly urban planning and Commercial and industrial properties are not development; and taxed twice. Instead, a portion of each Work towards a more equitable distribution of fiscal resources. capacity is taxed at the area-wide tax capacity rate and the balance is taxed at the total local Assessment of the programs success in tax rate. As a simple example, in a accomplishing the second of these goals community where exactly 40 percent of all often commercial, industrial, and utility property is net recipients, contributed to the fiscal disparities pool, 40 contributors. Proponents of the program focus on the relative uniformity of the area-wide tax rate and 60 percent is taxed at taxation of commercial and industrial the total local taxrate. In 2013, for example, property across the metropolitan area and the the Twin Cities area-wide tax rate was stability the net contributors provide to the 153.491percent and the Taconite Area-wide region as a whole. They argue that greater tax rate was 169.533percent. uniformity and stability give the entire region a competitive edge in national and global marketplaces. Policy Issues The original intent of the program was The critics of the system argue that the articulated through the following six contribution rate of 40 percent is arbitrary objectives: and that the distribution formula is solely Provide a way for local governments based on the relative property tax base wealth to share resources generated by of each city. Also, the formula uses non- regional growth; adjusted assessment levels. Cities with high Encourage orderly urban development assessment levels contribute more tax base by reducing competition for than cities with lower levels, creating a commercial and industrial disincentive to raise the assessment level. development; Establish incentives for regional Although fiscal disparities is generally cooperation; considered to impact commercial and Provide a way for regional resources industrial properties, a House Research study to be available through the existing found that homestead tax rates are also system of local governments; affected. For example, the homestead tax Make resources available to rate in St. Paul was 8.8 percent lower in 2004 communities at the beginning stages because of the program. In the same year of development or redevelopment; Bloomington, a net contributor, experienced and a 5.5 percent increase in the average homestead tax rate. The study found that tax Encourage environmental protection base sharing did not lead to such extreme changes in most cities. Descriptions of the program, such as those offered by the Minnesota House of Within cities,property classes can experience Representatives Research Department and the impacts of tax base sharing differently. the Metropolitan Council, often highlight two 2 page 94 Declines in the market values for Twin Cities utility property value taxed at the local tax rate. area commercial/industrial properties in the early 1990's not only directly shifted property 2012 Study tax burdens to other types of property, they also reduced the amount of commercial and An in-depth study of theseven-county metro industrial valuation contributed to the fiscal area fiscal disparities program was released disparities pool. As a result, the total in early 2012. It was done at the direction of distribution levy generated through the fiscal the legislature by a private consulting firm. disparities program was also reduced. In the The key research question was: what would mid- the impact be on tax capacities, tax ratesand this trend. But reductions in the tax levies if the program ceased to exist? The commercial/industrial and public utility authors found that tax capacities per capita property tax class rates by the 1997-2001 would decrease in all counties but Hennepin Legislatures have slowed growth in the tax if the program were eliminated. The analysis capacity of both the Metropolitan and showed that total tax rates would go up in Taconite Area fiscal disparities pools. When each county other than Hennepin. The full the amount of this distribution levy declines report or grows more slowly than the total tax base, website. a greater share of the local tax bill is paid by other types of properties, including the portion of each commercial, industrial, and Resources House Research: http://www.house.leg.state.mn.us/hrd/topics.asp?topic=21 The Metropolitan Council http://www.metrocouncil.org/metroarea/FiscalDisparities/index.htm Revised 12/2013 3 page 95 page 96