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2018-05-30 Council Work Session MinutesCITY OF MENDOTA HEIGHTS DAKOTA COUNTY STATE OF MINNESOTA Minutes of the Workshop Held Wednesday, May 30, 2018 Pursuant to due call and notice thereof, the workshop of the City Council, City of Mendota Heights, Minnesota was held at 1:20 p.m. at City Hall, 1101 Victoria Curve, Mendota Heights, Minnesota. CALL TO ORDER Mayor Garlock called the meeting to order at 1:20 p.m. Councilors Duggan, Paper, and Petschel were also present. Councilor Miller arrived at 1:35 p.m. Also present were: Mark McNeill, City Administrator; Cheryl Jacobson, Assistant City Administrator; Tim Benetti, Community Development Director; Kristen Schabacker, Finance Director; Dave Dreelan, Fire Chief; Wayne Wegener, Police Captain; and Andy Pratt, City Attorney. DISCUSSION OF FIRE STATION PROJECT AND BONDS City Administrator McNeill stated City Attorney Andy Pratt was present to talk about bonds regarding the potential fire station remodeling project. Mr. McNeill reviewed the information from the meeting held at the fire station in February. Staff is asking City Council to take action at their June 5, 2018, meeting on the bond issue for the fire station. Fire Chief Dave Dreelan gave a recap of steps that have been taken to move the fire station remodel forward. In 2015, Buetow Architects were hired and provided four or five different designs for the fire station. A year later after seeing the Eagan Fire Station that was remodeled by CNH Architects, the City Council hired that firm to do a concept plan and preliminary budget for proposed improvements to the fire station. A Fire Station Building Committee was formed and met for two months to get a design for basic needs and concerns of the fire station that would work for the next 20 to 30 years. In February, Council met at the fire station to review the plans and budget. The decision to move forward was then put on hold until the results of the Independent School District #197 bond referendum were known. Mr. Dreelan also discussed the timeline for the bond issuance to finance the project and the possible construction timeline. He recommended to seek bids in mid-November and award the contract before the end of the year, so as to reduce overall costs for the project. February 2019, would be the probable date for the contractor to mobilize the equipment at the fire station and start construction, weather permitting. Councilor Duggan asked if there was firefighter support for the project. Mr. Dreelan responded yes, but many were aware that there had been false starts previously. Councilor Duggan asked if firefighters had input into the remodel plans. Mr. Dreelan said they have and those have been addressed by the Building Committee. The committee was able to prioritize needs versus "wish list" items. Councilor Paper asked if the plans included providing for an Emergency Operating Center (EOC). Mr. Dreelan responded they have been included in the plans for additional phone and TV outlets in the training and conference room as part of an EOC. Councilor Paper said there are Federal funds available for EOC upgrades. Mr. McNeill said looking into and applying for grant money might delay the project. Mr. Dreelan responded that there is not a lot of cost involved in installing the needed phone and TV outlets, which would be unique for the EOC. The most expensive items would be new phones and a new base radio. Mr. McNeill referred to the spreadsheet which showed the property tax estimate for the impacts of the ISD 197 Bond Referendum, proposed FY 19 City Levy, and Proposed Fire Station Improvement Bonds based on a home valued at $356,000. Councilor Petschel asked about the cost of the fire station remodel. Mr. Dreelan responded the cost is estimated at $5.4 or $5.5 million. Mr. McNeill said the spreadsheet from Ehlers & Associates was based on issuance of $6 million in bonds. This amount would include the closing and issuance costs for the bond sale. The spreadsheet showed an estimated increase in property taxes of 6.5% of the city levy for the fire bonds, assuming that they were repaid spread over 15 years. The estimated property tax increase would be $8.00 a month. The school district referendum is raising the property taxes $12 per month. He said that the city levy should be more modest in 2019; a 5% increase for 2019 which would be about a $6 a month increase. He said that the total of the increases would be about a 7.85% increase in property taxes. He noted that this did not take into account any increases in operating budgets for the School District or Dakota County. Councilor Petschel asked if anything could be done in terms of paying off the Par 3 bonds and eliminating a road project. Mr. McNeill said the street projects are in line with the Engineering timeline. There are four years left on the Par 3 bonds. Discussion of how long the bonds could run and paying principal only for the first five years was had. Mr. McNeill said fire station bonds could be as long as 30 years. Councilor Petschel said Parks and Recreation is expecting money inflow after the Par 3 bonds are paid off She asked if the money currently be used to pay off those bonds could be continued and be split between the fire station and Parks and Recreation. She also asked if the City's AAA bond rating could be used as leverage for projects and paying only principal on the bonds for a few year affect the City's bond rating. Mr. Pratt responded that he would need to look into if paying only principal would affect the City's bond rating. He also noted bonds payments are due in February and August. The bond payments could be pushed back to the year 2020. Mr. McNeill asked if there would be savings on the interest over a shorter term and the Par 3 bonds could be figured into a new analysis. He thought $260,000 could go to the fire station, or $100,000 to Parks and Recreation and $160,000 to fire bonds. May 30, 2018 Mendota Heights Council Workshop Page 2 of 5 Councilor Petschel said more information would be needed on bond terms and the impact on homeowners. Mr. McNeill suggested holding another workshop before the City Council meeting on June 5, and Ehlers & Associates could do another spreadsheet with the new information. Mr. McNeill went over the timeline for the bond issuance schedule: CC Calls for hearing on CIP and issuance of bonds Send Public Hearing Notice to Newspaper Public Hearing Notice Published Public Hearing on CIP Reverse Referendum on CIP Period Expires Call for Sale of Bonds Rating Call Sale of Bonds Closing on Bond Sales June 5 June 11 June 15 July 2 August 1 August 7 Week of August 27 September 4 Last week of September Councilor Petschel was concerned that the public hearing would be held so close to a holiday, and that a lot of people might be out of town. She said that there needs to be transparency in the process. Mr. Dreelan said open houses could be held at the fire station with a flyer to hand out. Councilor Petschel suggested a postcard be sent out to every home in Mendota Heights that would have the date of the public hearing and open houses. Mr. Dreelan said he created a fact sheet that was modeled after other cities that have gone through the same process. Mr. Dreelan said 401 signatures would be needed by July 30 to force a referendum. Mr. Pratt said if it did go to referendum that notices were needed for the Minnesota Secretary of State, and was not sure if there was enough time for the November election. Mr. Dreelan said he knew of two cities that went to referendum for issuing bonds for a fire station. The schedule for the bond issuance was discussed. Councilor Duggan said there needs to be excellent communication about the bond issuance and fire station remodel. Councilor Petschel said she believes that a postcard needed to be sent to every home with dates of the public hearing for the bonds, and a fact sheet to be passed out at the fire station open houses. Mr. McNeill said tax payer dollars cannot be used to promote the station remodel, but could be used to publicize the public hearing. Councilor Paper suggested adding information to the website with the postcard of dates and a fact sheet. Councilor Petschel said that the things that needed to be stressed are the safety issues of firefighters breathing in exhaust as they put on their gear, and that better equipment is needed for washing their gear. Also, there is a need to promote the community meeting room. Councilor Duggan asked if traffic signals on Dodd Road outside of the fire station should be included. Mr. Dreelan said that could be included if MNDOT approved. It might be able to be incorporated if signals are ever installed at South Plaza Drive and Dodd Road. Councilor Miller said sending a postcard and directing people to the website with information would be effective. Mr. McNeill said he would talk to Ehlers & Associates about a new spreadsheet with different bond issuance scenarios. It may not be ready until Monday before the June 5th Council meeting. May 30, 2018 Mendota Heights Council Workshop Page 3 of 5 Councilor Petschel said the $65,000 per year for the payment of repairs at the hockey rink in West St. Paul could be timely and will be paid in full by 2020. The Council needs to think about how much of this money will be set aside for parks maintenance. Councilor Duggan asked when the postcards would be mailed to homes. Councilor Petschel said it should be mid-June so it can get there before the July 2nd public hearing. Councilor Paper asked when the open houses would be held at the fire station. Mr. Dreelan said there could be three - maybe a Monday night, Thursday night, and a Saturday morning. Mr. Dreelan said he has talked to the City Councils of Sunfish Lake and Lilydale already about the possible remodel. They do not have any problems with it. He is going to the Mendota June City Council meeting to talk to them about it. Mr. Dreelan asked Ms. Schabacker how much they would be charged for the remodel. Ms. Schabacker responded she would work to get numbers. Councilor Paper asked how the cities were charged for fire calls. Ms. Schabacker said it was based on the market value of the city and number of calls to their city over the last two years. Councilor Duggan asked if a meeting should be set up with the Mendota Heights City Council and Mendota, Lilydale and Sunfish Lake City Councils. Mr. Dreelan said he is or will talk with the cities he also told them that Mendota Heights staff is available to answer any questions they may have. They have commented that having HealthEast at the fire station is an asset. Mr. Dreelan said there is no contract in place with HealthEast. Mr. Dreelan thanked the Council for their time. DISCUSSION OF FY 2019 BUDGET Mr. McNeill said the 2019 Budget planning would start soon. Labor contracts for the next year are set at 2.75% in increases. No new additional personnel positions are being contemplated. He reported that Ms. Schabacker said last year the City did very well regarding budgeted revenues and expenditures. There are one-time expenses such as Public Works equipment and $250,000 for Wentworth Park improvements. Staff would work to come in lower than a 5% increase in the 2019 proposed levy. Councilor Petschel said Council needed to look long term at the Par 3 and their equipment. The Par 3 will never make money to sustain itself, that there are struggles with their mowers. She felt that maybe putting off a street project until the Par 3 bonds are paid off would be a good idea. She would like to see a re -sequenced list of street projects. She said that Mr. Ruzek needed to take a hard look at how he is sequencing the street projects to help keep the budget down. Dates were discussed for budget workshops. It was decided to hold budget workshops on August 13 and August 15 starting at 1:30 PM. An extra date, August 21 was decided on starting at 5:30 pm in case another budget workshop was needed. On other issues, Mr. McNeill reported that a notice was served over improper look ups and will go to the League of Minnesota Cities. May 30, 2018 Mendota Heights Council Workshop Page 4 of 5 The developers of Orchard Heights asked about street lights. Councilor Petschel suggested to reference the Hidden Creek development on street lights as none had been installed there. He said that a call had been received from a contractor, requesting a staging area for the Highway 149 (Dodd Road) work. They would like to use the Village lots or the Paster site where the bonfire is held. Councilor Petschel said she would like the site to be behind Mendota Plaza, and not the Village lots. Councilor Miller asked if the site would be cleaned out in time for the Halloween Bonfire. Mr. McNeill said he would let MnDOT know the preferred site would be at the Paster property and would ask if it would be cleaned up in time for the Halloween Bonfire. Councilor Petschel said that Paster Properties are no longer do their own leasing, and is now being done by a realty company. Mr. McNeill said the Reserve is holding a special tour for the new apartments and it is scheduled for June 19 at 5:45 pm. He also received an email from Representative Rick Hanson regarding House File 3693 being signed into law, but that he was not sure of the meaning of the bill. It is related to the proposed Registered Sexual Offender Ordinance which was scheduled to be on the June 5th Council meeting agenda. However, he asked to defer consideration to the second meeting in June, as the Police Chief is out of town. The Council concurred. Councilor Petschel asked if the Scott Patrick memorial in West St. Paul topic was on the agenda for the next West St. Paul Council meeting. Mr. McNeill said that he had not heard if it was on the agenda, but that an agreement was being worked on. He will keep the Council updated on the issue. ADJOURN Councilor Duggan moved to adjourn. Councilor Petschel seconded the motion. Ayes: 5 Nays: 0 Mayor Garlock adjourned the meeting at 2:46 p.m. Neil Garlock Mayor ATTEST: L Lorri Smith City Clerk May 30, 2018 Mendota Heights Council Workshop Page 5 of 5