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2019-02-19 Council MinutesCITY OF MENDOTA HEIGHTS DAKOTA COUNTY STATE OF MINNESOTA Minutes of the Regular Meeting Held Tuesday, February 19, 2019 Pursuant to due call and notice thereof, the regular meeting of the City Council, City of Mendota Heights, Minnesota was held at 7:00 p.m. at City Hall, 1101 Victoria Curve, Mendota Heights, Minnesota. CALL TO ORDER Mayor Garlock called the meeting to order at 7:00 p.m. Councilors Paper, Miller, and Petschel were also present. Councilor Duggan was absent. PLEDGE OF ALLEGIANCE Council, the audience, and staff recited the Pledge of Allegiance. AGENDA ADOPTION Mayor Garlock presented the agenda for adoption. Councilor Petschel moved adoption of the agenda with the exception of item 7a) Representative Ruth Richardson Comments, which was removed. Councilor Miller seconded the motion. Ayes: 4 Nays: 0 Absent: 1 (Duggan) CONSENT CALENDAR Mayor Garlock presented the consent calendar and explained the procedure for discussion and approval. Councilor Petschel moved approval of the consent calendar as presented, pulling item i.) Approval of Resolutions 2019-15 & 2019-16 Sponsoring an Outdoor Recreation Grant for Wentworth and Hagstrom- King Parks. a. Approval of February 5, 2019 City Council Minutes b. Approval of January 15, 2019 Council Work Session Minutes - Park and Ree c. Approval of February 5, 2019 Council Work Session Minutes - Planning d. Acknowledgement of January 8, 2019 Parks & Recreation Commission Meeting Minutes e. Approval of Community Service Officer Hire f. Approval of IT Server Storage and Backup Infrastructure Redesign g. Approval of Fire Department Training Assistant Appointment h. Acknowledgement of January 2019 Fire Synopsis i. Approval of Resolutions 2019-15 & 2019-16 Sponsoring an Outdoor Recreation Grant for Wentworth and Hagstrom-King Parks j. Approval of Professional Services Change Order of the Lexington Highlands and Mendakota Street Improvements k. Approve Ideal Energy Solar Panel Additions to Fire Station and Public Works Buildings 1. Acknowledgement of January 2019 Building Activity Report in. Approval of December 2018 Treasurer's Report n. Approval of Claims List Mayor Garlock seconded the motion. Ayes: 4 Nays: 0 Absent: 1 (Duggan) PULLED CONSENT AGENDA ITEM I) APPROVAL OF RESOLUTIONS 2019-15 & 2019-16 SPONSORING AN OUTDOOR RECREATION GRANT FOR WENTWORTH AND 14AGSTROM-KING PARKS Councilor Miller asked if this was the first time the city had applied for the Outdoor Recreation Grant. Public Works Director Ryan Ruzek replied that, to his knowledge, this was the first time the city has applied for this grant program. Councilor Miller asked for confirmation that this is not a new grant program, which Mr. Ruzek confirmed. It was first implemented in 2012, which was successful, and the legislatures voted to maintain it and keep it going. Councilor Miller asked if there were stipulations regarding when the city could apply again for this grant. Mr. Ruzek replied that the city should be able to apply for this grant again. Each individual park would require its own application. This request is for two parks, requiring two separate resolutions and applications. Councilor Miller noted that the reason he pulled this from the Consent Agenda was due to the eligible projects listing including sports' fields and courts. He was thinking about the shortage of court and field space and the possibility of using this grant application to help solve that issue. Mr. Ruzek replied that the city would first have to include a project in their Capital Improvement Plan and then the city would have to provide at least a 50% match on the grant; up to the $250,000 limit. The city could plan for a $500,000 project, and assuming they would obtain the grant, the city would be reimbursed $250,000. Councilor Paper, noting that eligible projects included park roads and parking areas, which may not exceed 40% of the total project cost, asked is that caveat was only for that item. Mr. Ruzek replied that is only on that item. Councilor Petschel moved to adopt RESOLUTION 2019-15 SPONSORING AN OUTDOOR RECREATION GRANT FOR WENTWORTH PARK, and adopt RESOLUTION 2019-16 SPONSORING AN OUTDOOR RECREATION GRANT FOR HAGSTROM-KING PARK. Councilor Miller seconded the motion. Ayes: 4 Nays: 0 Absent: 1 (Duggan) February 19, 2019 Mendota Heights City Council Page 2 of 9 PUBLIC COMMENTS No one wished to be heard. PRESENTATIONS A) REPRESENTATIVE RUTH RICHARDSON COMMENTS This presentation was removed from the agenda. B) SOLAR GARDEN SUBSCRIPTION PRESENTATION City Administrator Mark McNeill reminded the Council that they had just approved, in the Consent Agenda, the placement of two additional 20 Kw solar array units, one on the Public Works building and the other on the expanded Fire Station. Before the Council at this time is consideration for the city to become a subscriber to a community solar garden. He introduced Mr. Eric Jensen, Business Development Manager at ReneSola Ltd., to talk about the solar garden concept and what is being proposed. Mr. Jensen explained that ReneSola is a community solar developer; they do not do on-site projects, like Ideal Energies. They work nationwide and globally at the utility scale. In Minnesota, they work within Xcel's Community Solar Program, which was created approximately five years ago. They created a program that would allow developers to go out and find sunny sights, in ideal spots near Xcel's transmission grid, and build solar gardens. However, they had to work with the customers to make the gardens possible. So it is not a solar installation that they get paid for directly; the subscribers would then get the credit and they would get reimbursed as a pay-as-you-go sort of structure. Program Basic Rules: • Program was mandated by legislation 216B.1641, in September 2013 • Bill Credit amount changes annually, according to the Applicable Retail Rate (ARR) • Community Solar Garden (CSG) and subscribers must be in Xcel territory • Subscriber must be in the same or adjacent county as the CSG • No subscriber can have more than 40% of a single CSG • Allowed to subscribe up to 120% of 12 months average annual usage • CSG agreements with Xcel are for 25 years • No upfront costs to subscribers • No system maintenance costs for subscribers About ReneSola • A global company, US division based on the east coast; they have worked in countries around the world and have mega -watts of projects • This is their 3rd round of community solar gardens in Minnesota; have a new round coming up later this summer • Xcel has changed the rules so what Mendota Heights would get is a legacy project; higher savings, subscriber credit February 19, 2019 Hendota Heights City Council Page 3 of 9 How Community Solar Works • Monthly Xcel Energy Bill Credit — based on actual production (KWh) of solar garden for that month • Monthly Invoice/Payment to solar garden — will match (KWh) production on Xcel Bill, but rate per KWh is less than credit • Savings — savings is captured by the Xcel ARR Credit (2019 rate $0.12405/Kwh for general service meters and $0.14509/KWh for small general) is greater than solar garden payment in Year 1 ($0.1128/KWh) Three-part Recipe • ReneSola & Partners — find the site, work with landowners, interconnect with Xcel, handle the project, make it come to life • Xcel — key partner; taking energy from solar gardens and putting into their grid Subscribers — crux of the community solar program; the garden produces energy, the portion of a subscribers garden will be printed on their Xcel bill (no payment goes directly to ReneSola); in turn, as the subscriber is getting the credit, ReneSola covers the upfront costs and creates a pay- as-you-go structure; that is when they would get an invoice as a subscription; match it up in such a way that the credit is more than the subscription (saving money) Two options*: • Flat Rate Option: 25 -year subscription at 12.4 cents and never changing — estimated savings over 25 years of $1,014,747.90. • Escalator Option: 11.28 cents the first year with an increase of 1 % every year — estimated savings over 25 years of $953,515.46. *based on conservative reasonable estimation of Xcel rates increasing by 2.6% per year Rice County Garden Locations: • Northfield Site: 7281 -115th Street E, Northfield, MN • Walcott Site: 24230 Albers Ave., Faribault, MN • Warsaw Site: 24950 Farwell Ave., Morristown, MN Project Status: • Xcel applications approved • Interconnection agreements in place • Site control, leases in place • Local permits in place • Construction Start Q 12019 • Energization Q3 2019 Councilor Miller noted that Mr. Jensen had stated that the average energy consumption in Mendota Heights was calculated at roughly 700,000 Kw per year; shortly afterwards, he mentioned the subscription size of approximately 840,000 Kw per year. He questioned the difference. Mr. Jensen replied that the subscription size incorporating the existing solar, and then using the 120% rule. The current usage is approximately 700,000 Kw plus 20% on top of that equates to the 840,000 Kw subscription size. February 19, 2019 Mendota Heights City Council Page 4 of 9 Councilor Petschel, noting that Xcel Energy is asking for funds from the legislature to continue their nuclear operations and they are trying to make a commitment to get to 10% solar, asked if Mr. Jensen sees the other trends being wind and natural gas. Mr. Jensen replied in the affirmative. She asked how that could affect Xcel's future fees. Mr. Jensen referenced an article about Xcel's carbon-free commitment; their goal is to go into 2050 carbon-free, which includes nuclear. Their wind power has exceeded the 30% target, and they have always mentioned natural gas being part of their off-setting plans for coal but they do not have coal to off-set any more. He would guess that they cannot have carbon-free with natural gas; so at some point that would have to scale out. He continued by saying that ReneSola, rather than a smooth 2.6% annual increase, took the historic data of the last 15-20 years and charted it out. It shows Xcel's rates jumping a bit and then flattening slightly, and then jumping again. This is good for planning purposes and long-term estimates. Due to technology changes she sees coming in the future, Councilor Petschel stated she would be more comfortable with the flat-rate option rather than the escalator option. Mayor Garlock asked for confirmation that most city subscribers have chosen the flat-rate option. Mr. Jensen confirmed, indicating that Minneapolis, Rosemount, school districts, the Metropolitan Council (MetCouncil), have all gone with the flat-rate option. Decision-makers who have opted for the escalator method tend to be businesses because they can make money on the funds they save earlier on. Cities want stability. Mr. McNeill noted for the Council's consideration, that the solar panels onsite are really back loaded in terms of benefits financially to the city. There are some modest savings through the first 11 — 13 years, until those arrays are paid off; then the city would see the big savings. Going with ReneSola, the city would see savings of $12,000 in the first year versus $3,000. Over time, the flat rate would generate approximately 6% more but that is over 25 years. Councilor Paper asked for confirmation that ReneSola carries all of the paperwork on this. Mr. Jensen replied that ReneSola has three key partners — ReneSola, the developer; a financier who can take tax equity and depreciation and capitalize that; and a long-term operator that does nationwide renewable project management for long-term commitments who would provide daily monitoring. Together, they make the garden possible within Xcel's program. Councilor Paper asked what would happen if there was a catastrophe in the garden that the city would subscribe to. Mr. Jensen replied that this is covered under the Force Majeure clause. If a tornado were to hit the solar garden and it goes out for three months, ReneSola works to get everything back up and running. Everything is insured, and meets Xcel's re-establishment requirement timelines, etc. The city's subscription portion of the garden does not produce energy while it is being repaired, so the city does not receive a credit on its Xcel bill and receives no subscription invoice. Councilor Paper asked what the expected useful life of a solar garden is. Mr. Jensen replied that these are 25 year power plants. They are cautiously optimistic that once they come close to being 25 years old, the solar panels themselves could probably run for approximately 40 years. It is possible that Xcel could allow the interaction to be extended. However, ReneSola would have the money set aside from the start to return the land to the state it was at the start; and they can recycle the panels and start with whatever Xcel has at that point for a community solar program. February 19, 2019 Mendota Heights City Council Page 5 of 9 Councilor Paper asked how many kilowatts they anticipate this farm to generate. Mr. Jensen replied that Mendota Heights would be 4% of the total production; definitely not a small subscriber. Councilor Paper asked for confirmation that the projection is that the city would save approximately $1M with no up front costs from their own pocket. Consensus of the Council was to go with the flat rate option. Mr. McNeill informed the Council that staff would work with ReneSola and bring the contract back for consideration at the March 5, 2019 City Council meeting. Councilor Paper noted that the city would be saving approximately $1M with this subscription and also saving money on the solar panels already on their own buildings; he asked how much the city would be saving on the existing solar panels. Mr. McNeill replied that they would save approximately an additional $1 M. This makes financial and environmental sense. Councilor Petschel stated that her preference would be that Mendota Heights become part of the Northfield site since it is located just down the highway. PUBLIC HEARING No items scheduled. NEW AND UNFINISHED BUSINESS A) AUTHORIZE CONTRACT WITH TREE TRUST FOR RESIDENT TREE SALE Natural Resources Technician Krista Spreiter explained that there has been interest expressed in having a tree sale that would be offered to residents by the city. Some research has been done on options available and it was discovered that Tree Trust offers a good program. She introduced Ms. Karen Zumach, Director of Community Forestry with Tree Trust, to provide information about their program. Ms. Zumach explained that Tree Trust is a non-profit organization that has been working in the Twin Cities to restore the urban tree canopy since 1976. They worked to replant trees after the Dutch Elm disease came through in the 1970's. They have been facilitating tree sales for cities since 2006 and have distributed nearly 20,000 trees to residents for planting on private property. Trees are important in communities, however, they do cost money to maintain. Increasing the canopy on private properties is one of the lowest cost ways to increase the canopy within the community. Tree Trust offers a variety of native and shade -tolerant trees, and can also provide fruit trees for communities if they are interested. They offer a website and a platform that facilitates payment by residents through PayPal. They have youth and young adults that can help with tree distribution. They can create news releases, contact the newspapers, and do a social media push. The trees that they offer tend to be anywhere from 6 - feet to 8 -feet tall and are in a container equivalent to a 5 -gallon bucket. They would generally retail anywhere from $125 to $150; they are able to offer those trees at a subsidized cost. February 19, 2019 Mendota Heights City Council Page 6 of 9 If this were to be done in Mendota Heights, they would be looking at an early promotion starting in the next month with news releases and social media posts. They would have the ordering platform set up around mid-March and the trees would be available for pick-up by residents in the month of May. Councilor Miller asked for specifics on what trees would be available. Ms. Zumach replied that she orders the majority of the trees through Bachmann's; they can provide anything from Oaks to disease resistant Elms, but no Ash Trees. They do try to focus on shade trees so they are getting more bang for their buck in creating that canopy cover. They leave the decision of deciduous or other types of trees up to the cities; but they do encourage diversity. Councilor Paper asked if there was a limit per resident. Ms. Zumach replied that the limitation would be set by the city. Ms. Spreiter noted that the contract proposes 50 trees with an option to increase that number if sales are relatively good and they run out of trees available. Councilor Paper then asked where the trees would be delivered to. Ms. Zumach indicated that would be determined by the city. Councilor Petschel moved to authorize staff to enter into a contract with Tree Trust for the amount of $4,929.16, with the cost coming from the Parks Department Invasive Species Management budget. Mayor Garlock seconded the motion. Ayes: 4 Nays: 0 Absent: 1 (Duggan) Councilor Miller asked what this means for the city's current projects regarding invasive species management. Ms. Spreiter replied that this is a way to accomplish that goal and compensate for the canopy loss by replanting. Other projects that are ongoing have already been funded. Councilor Miller stated that if they have a high level of success, it would be nice to dedicate monies for this on a yearly basis. B) REVIEW THE WENTWORTH WARMING HOUSE PRELIMINARY DESIGN Public Works Director Ryan Ruzek shared the Wentworth warming house layout with the Council. He explained that the city awarded a contract to CNH Architects in September 2018 and staff received the first layouts. The Parks and Recreation Commission made comments and suggestions, which included moving the restrooms to the parking lot side of the building, and asked for clarification as to what type of programming would be provided in the summer months in the space. Once that is clarified, they would then be able to more adequately comment on the size of the space. The proposed layout did not include any cost estimates; however, the project was proposed to be funded through the Special Parks Fund and was estimated to cost approximately $150,000. Councilor Petschel asked what the roof materials would be. Mr. Ruzek was unable to provide that information; but assumed it would be a standard asphalt shingle roof. However, they could look at other options. Februa7y 19, 2019 Mendota Heights City Council Page 7 of 9 Councilor Miller liked the idea of moving the restrooms to the parking lot side of the building. He also liked the idea of having access to at least one of the restrooms on the inside. Councilor Paper asked what the current size of the new warming house would be, which Mr. Ruzek was unable to provide; however, the old warming house was smaller than the standards — approximately 10' by 18'. The size of the two warming houses just built was unknown; but Mr. Ruzek guessed 16' by 24'. This new one would not be smaller than the standard. Councilor Paper believed that the skylights in the roof were a great addition, bringing the natural light into the building. Councilor Petschel expressed her concern that the estimate for the cost of this was not included. She wanted to ensure that the building, the landscaping, and the utility costs does not exceed $150,000. Mr. Ruzek noted that this project has been included in the grant application discussed earlier in the evening. C) ESTABLISH COUNCIL WORK SESSION MEETING DATE City Administrator Mark McNeill expressed the need to do some follow-up on the 2019-2020 City Goals and Objectives and to- review the Village lots RFP. He suggested the Council hold a work session on February 26, 2019, starting at 12:30 p.m. This date and time was confirmed by the Councilor's present. COMMUNITY ANNOUNCEMENTS City Administrator Mark McNeill announced that the bid opening for the Fire Station building has been delayed 24 hours due to a pending snow storm; it will instead be on Thursday, February 21, 2019 at 2:30 p.m. He also said that registrations for the Officer Scott Patrick Memorial 5K to be held on June 1, 2019 will open on March 4, 2019. Nominations for the Jerry Murphy Community Award are due on March 15, 2019. COUNCIL COMMENTS Mayor Garlock announced a snow emergency will be declared; schools are being cancelled already for the following day. He reminded residents to remove their parked cars from the streets so the streets can be cleared of snow. Councilor Miller extended congratulations to Firefighter Jay Taylor for winning the 2018 Firefighter of the Year Award. He also congratulated Mr. Dan Johnson who was just awarded the Assistant Training Officer position. Councilor Petschel reminded residents to shovel out the fire hydrants in their neighborhood. February 19, 2019 Mendota Heights City Council Page 8 of 9 Councilor Paper expressed his appreciation to Public Works for their outstanding work these last few weeks with getting the roads, pedestrian ways, and the ice rinks cleared of snow. He has heard positive comments from many residents. ADJOURN Mayor Garlock moved to adjourn. Councilor Miller seconded the motion. Ayes: 4 Nays: 0 Absent: 1 (Duggan) Mayor Garlock adjourned the meeting at 8:05 p.m. Neil Garlock Mayor ATTES . Lorri Smith City Clerk February 19, 2019 Mendota Heights City Council Page 9 of 9