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HomeMy WebLinkAbout2025/11/17 - ADMIN - Minutes - City Council - Study SessionOfficial minutes Special study session St. Louis Park, Minnesota Nov. 17, 2025 The meeting convened at 6:46 p.m. Council Members present: Mayor Nadia Mohamed, Margaret Rog, Lynette Dumalag, Sue Budd, Tim Brausen, Yolanda Farris, Paul Baudhuin Council Members absent: none Staff present: City manager (Ms. Keller), city attorney (Mr. Mattick), community development director and interim building and energy director (Ms. Barton), administrative services director (Ms. Brodeen), city assessor (Mr. Bultema), finance director (Ms. Cruver), facilities superintendent (Mr. Eisold), legislative and grants analyst (Ms. Ferris), public services superintendent/deputy public works director (Ms. Fisher), recreation superintendent (Ms. Friederich), fire chief (Mr. Hanlin), city clerk (Ms. Kennedy), police chief (Mr. Kruelle), deputy police chief (Mr. Nadem), deputy city clerk (Ms. Scott-Lerdal), communications and technology director (Ms. Smith), financial analyst (Ms. Stephens), engineering project manager (Ms. Sullivan), park superintendent (Mr. Umphrey), HR director (Ms. Vorpahl), planning manager (Mr. Walther), parks and recreation director (Mr. West), racial equity and inclusion director (Ms. Yang), sustainability manager (Ms. Ziring) Guests: Natalia Madryga, Amy Koch, Alysen Nesse; Momentum Advocacy Discussion items 1. Consider the proposed study session topic: neighborhood grant funds City council members are proposing a study session to discuss a possible path forward that provides neighborhood groups with more flexibility in how they spend city grant funds. In February 2025, the council adopted a program that excludes spending on social events and entertainment as well as non-essential meals. This program was created and recommended by staff to meet the goal of the neighborhood program while ensuring compliance with public purpose regulations governing the use of public funds. Council Member Rog stated that the discussion related to neighborhood grant funds should take place before the new grant year starts in 2026. Council Member Rog shared resident testimonials to council members to review. She stated that some residents have given up on neighborhood grants due to barriers and gave examples that gatherings are not as rewarding anymore, some groups are struggling with attendance and morale, volunteerism is down and new neighborhood groups are having problems launching. Council Member Rog stated that neighborhood groups are asking for city assistance so they can continue. Council Member Rog added that when a neighborhood organization dies, the opportunity to invite new volunteers and pass leadership to other neighbors dies as well. Council Member Rog stated it is important to provide a lifeline to these groups sooner rather than later. She noted that a neighborhood leaders meeting is scheduled to take place at city hall on Dec. 18, 2025. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -2- Nov. 17, 2025 The purpose of the meeting is to provide a chance to infuse leaders with new enthusiasm before more groups disband, cannot get organized or give up. Council Member Rog proposed that the discussion take place when the city attorney is available to be present and be limited to the 2025 analysis of food expenses only, as food was the most commonly cited barrier to a successful program. Additional barriers could be discussed next year during the community engagement systems discussion. Council Member Budd shared that she knew of one neighborhood group leader was ready to quit. It has taken that neighborhood organization a long time to get motivated and organized. Being able to spend neighborhood grant funds on food for social events would greatly help to keep the group intact until new leadership can be found. Council Member Budd added that when looking at the question about conducting government proceedings, one of the city’s five strategic priorities: “the city is committed to creating opportunities to build social capital through community engagement,” speaks directly to why this expense qualifies as a public purpose and the neighborhood groups are one of the strongest elements of building social capital the city has. Council Member Budd added that building this connection meets the requirements and she is in favor of moving ahead on this discussion as quickly as possible. Council Member Baudhuin agreed with the ideas of neighborhood groups in terms of community engagement and connection, noting that they benefit public safety when a neighborhood is connected. Council Member Baudhuin stated that some immediate actions can be taken to support neighborhood groups, as well as provide long-term assistance. Mayor Mohamed stated she would have liked to receive residents' comments related to neighborhood groups in advance of tonight’s meeting so she could review and think about them. Mayor Mohamed stated that for her not to have the time to fully consider the residents’ comments is not a fair evaluation. Council Member Rog stated that the comments were received over the weekend, so there was no time to share them to her fellow council members. Council Member Brausen stated he is a proponent of the systems process of discussions and is not comfortable with switching the order. However, since there is urgency with this issue, he would like to address this at the city council meeting on Dec. 1, 2025. Mayor Mohamed asked staff to walk the council through the audits related to neighborhood grants. Ms. Cruver stated that staff started reviewing policies related to public purpose in 2023 after an audit finding. Ms. Cruver stated the city received a finding in the audit for a large expenditure on food for a social event for staff and non-staff family members, which was not an allowable expense. After that finding, finance staff worked to meet all regulations related to public purpose and make corrections in purchasing policy. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -3- Nov. 17, 2025 Ms. Cruver added that these corrections forced staff to look into neighborhood groups and city policies on expenditures, including food purchases. She pointed out that staff evaluated neighboring city practices, including the City of Minneapolis, and held discussions with financial auditors and the city attorney. During these discussions, it was pointed out that social capital was not a sufficient reason for purchasing food for purely social events held by neighborhoods. Ms. Cruver added that the city must follow the city charter and state statute guiding principles. If the city defined providing food for neighborhood groups as a strategic priority, it would not change state statute and would not prevent another finding by auditors. Ms. Cruver summarized that this is why changes were made to food purchase policy for neighborhood groups and using neighborhood grant funds for purchase of food. Ms. Cruver reiterated that food can still be purchased if it is authorized in statute, such as for National Night Out, or for neighborhood clean-up days. The only time public dollars cannot be spent on food is for purely social events. Mayor Mohamed stated she understands frustrations related to the strictness of the policy. However, she does not condone spending public dollars to throw neighborhood-wide parties. Mayor Mohamed stated groups can still conduct neighborhood meetings and align their work with the city’s strategic priorities. She noted statewide concerns about preventing fraud. She wants this city council to be compliant and fiscally responsible to their decisions. Mayor Mohamed stated she is frustrated that the council keeps coming back to this discussion as if it was a decision that had been made lightly. Mayor Mohamed stated she wants to make sure there is a system in place. This will require the council to be intentional and thorough, giving the policy review more than one to two months of consideration. Council Member Dumalag stated that looking at neighborhood grants without the context of the entire budget and strategic priorities feels like the council is not giving this issue the weight it deserves. Council Member Farris agreed and stated that the agenda for the city council meeting on Dec. 1, 2025, has many items for the council to take action on. The beginning of 2026 would be a better time to revisit this policy. Council Member Budd stated there is urgency around this issue because the city has $50,000 budgeted for neighborhood grant funds and is only spending $9,000 of the allocated funds because they are not accessible or connected to the goal of building community. Ms. Keller shared that the systems discussions related to the neighborhood grants discussion is tentatively planned for early in the first quarter of 2026. Council Member Rog stated the city is losing neighborhood groups and having this discussion earlier will show the groups that the city hears them and is committed to this program. It is not critical to discuss neighborhood grants on Dec. 1, 2025, but she feels urgency to discuss it soon. Council Member Dumalag stated she does not want to forget about the auditor’s report. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -4- Nov. 17, 2025 Ms. Cruver stated this was related to food purchases for non-employees, which were purchased for a social event and not a city meeting. If there are consistent findings where the audit is not clean, and there are repetitive offenses, bond rating agencies will not want to be involved with the City of St. Louis Park. Council Member Rog stated we need to consider the risk-to-reward ratio and consider potential benefits. Council Member Baudhuin stated there is a notion that this was taken lightly by the council. He did not think this decision was considered thoroughly enough by the council originally. In his opinion, if this discussion cannot happen by Dec. 1, 2025, then it should happen in the first months of 2026. Ms. Keller added her concerns about this discussion taking place at the city council meeting on Dec. 1, 2025, with so many topics already planned for the agenda, all of which must be addressed. She suggested Dec. 15, 2025, as an alternative date for the discussion. Mayor Mohamed noted that if the discussion takes place in 2026, she wants to hold space for how Council Member Rog – whose term as council member expires on Jan. 5, 2026 - would participate in it. Council Member Rog agreed she has worked on the issue of neighborhood grants for some time but trusts that the future city council will responsibly and meaningfully take this forward. She shared the opinion that the staff report received for tonight’s meeting is not complete because it does not explain both the pros and cons of flexible spending for neighborhoods, focusing on the cons. The potential benefits and rewards toward meeting the city’s goal of being a more connected and vibrant community are missing. Council Member Rog stated that when council members expressed frustration with funding restrictions in February of 2025, as reflected in the meeting minutes, an analysis should have been proactively presented for the council’s consideration at that time. There is an option of considering an analysis with the city attorney’s guidance. Council Member Rog stated that she hopes this will move forward, noting she plans to provide comments as a St. Louis Park resident when this topic comes back to the city council’s agenda. It was the consensus of the city council to review neighborhood grant funds policy as a systems discussion in the first quarter of 2026. 2. First city council discussion of the 2026 legislative agenda Ms. Ferris introduced the topic of discussion and the representatives from Momentum Advocacy: Natalia Madryga, Amy Koch and Alysen Nesse. The group updated the council on legislative issues at the state and federal levels. The primary purpose of the legislative positions document is to guide the government relations work of the city. The document can also be used by the public to understand the positions the Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -5- Nov. 17, 2025 city takes and will advocate for. For this reason, legislative positions are written generally to include the long-term positions of the city on issues while remaining inclusive of the changing nature of specific legislation or programming that is proposed by elected officials. The positions also include specific law changes suggested by staff to better complete the work the city is required to perform. Following the study session, staff will finalize the document based on the council's discussion and direction. A small subset of positions is selected each year to be the St. Louis Park-specific legislative priorities for that session. These positions are selected based on specificity to St. Louis Park's needs, likelihood to gain traction in the upcoming session, and other contextual factors. A study session with the local delegation of elected leaders for St. Louis Park is scheduled for Dec. 1, 2025, to communicate the city’s priorities and policy positions before Minnesota’s 95th legislative session, which will convene on Feb. 17, 2026. It was noted that the policy considerations for the city council are: 1. Does the city council support the inclusion and revision of staff-initiated policy positions listed under the “New and changed positions” section of this report to the 2026 legislative position document? 2. Does the city council want to add any of the council-initiated policy positions under the “New and changed positions” section of this report to the 2026 legislative position document? 3. Does the city council support the recommended draft 2026 legislative priorities? Staff presented on recommended city priorities: Mr. Sullivan presented on transportation and infrastructure capital investment projects. Mr. Bultema presented on county tax assessment issues and the issue of being billed twice for services. Ms. Keller noted that the ability of the city to bill the county for reimbursement for assessments completed by the city is recommended as a city priority in 2026. Ms. Vorpahl presented on the Minnesota state paid family leave to the city council. Council Member Rog asked for more details on the Minnesota state paid family leave policy beginning in January 2026 and asked if there is any risk to the city policy that compromises the benefits received in other sectors. Ms. Vorpahl stated risk is likely: the city currently has an employer paid, 100% fully-funded, income replacement / short-term disability plan at no cost to the employees. Ms. Vorpahl added that the city will split the premium with employees, with both paying a premium on benefits already provided by the city. She added that this law will be enacted to allow flexibility for employees. Mr. Walther presented information on repealing a 2024 law that prohibits cities from licensing state-licensed facilities such as group homes serving six or fewer people. He stated licensing by the city helps these group homes to be served. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -6- Nov. 17, 2025 Council Member Brausen asked why the state adopted the licensing. Mr. Walther stated that some cities were using city licensing to limit the number of state licenses, so the legislation affected all communities. Ms. Barton stated a priority recommendation is income averaging for supporting more deeply affordable housing as well as the missing middle housing issue. Council Member Brausen asked if income averaging would pass in the legislature. Ms. Koch stated there is a possibility this will pass, adding that income averaging is a helpful addition to affordable housing programs. Chief Kruelle presented on public safety priorities and the light rail rollout. He noted calls for service and time on calls continue to rise in the city. With the addition of the light rail and its complication to public safety, additional officers will be needed. Council Member Rog stated there is discussion of a regional approach to public safety on the light rail and asked if this is a priority for other cities as well. Mr. Kruelle stated yes and added that police are collaborating with other cities. It makes sense to have a regional approach. Mr. Hanlin noted that establishing some local control on services provided to city residents by Hennepin Health Care EMS is a legislative priority for the fire department. This gives the city fire department more say on the level of services provided and can also create more transparency through increased reporting requirements by the transporting agencies. City Council recommendations for city positions: • Healthcare for all • Gun safety ordinances • Road safety • Corporate climate accountability Mayor Mohamed spoke to the topic of gun safety ordinances, which has come up with mayors from surrounding cities. Mayor Mohamed said if the state cannot ban guns, cities must develop their own ordinance but the ability to enforce an ordinance is vital. If there is no interest in a statewide approach, she is hoping the state will give cities the authority to ban guns from city- owned facilities. Ms. Madryga stated there is a high possibility that mental health funding may go through related to gun safety, adding that this will be a difficult item to accomplish. Control of a city's buildings related to gun safety would be the easiest measure to accomplish. Council Member Rog asked about preemption, including a desire and emphasis on cities banning guns in city buildings. Council Member Budd asked if this is in the city's priorities now. Ms. Keller stated the 2025 version had limited language around firearm safety. For 2026, and as per the League of Minnesota Cities' position, staff suggested adding more robust language around firearm safety. Council Member Brausen stated he is supportive of gun safety measures. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -7- Nov. 17, 2025 Council Member Rog commented on road safety as a priority and noted it came out of the safe streets legislation that Representative Kraft worked on. Ms. Ferris stated that the safe streets legislation was related to Minneapolis using speed cameras. Police Chief Kruelle added there is also discussion about a device similar in nature to the ignition interlock system, which can be outfitted on a vehicle to control its speed, and used to target the most aggressive speeders. Council Member Budd asked about the corporate climate accountability program. Ms. Koch stated the council will want to monitor to make sure the implementation is completed without dilution. Ms. Keller asked if the drafted language related to corporate climate accountability meets the council’s needs. Council Member Budd stated yes. Council Member Rog noted the healthcare priority, stating that while she appreciates the single payer and support of healthcare for all, she is concerned that supplementing single payer and multiple payers at the same time waters down the message. She would like to see the city have a stronger resolution to the single payer option. Ms. Ferris stated that staff could reword this. Ms. Keller asked the council about their stance on the policy questions: 1. Does the city council support the inclusion and revision of staff-initiated policy positions listed under the “New and changed positions” section of this report to the 2026 legislative position document? Council Member Brausen suggested that language be added to the THC policy regarding continued legality, adding that he is in favor of this. Minnesota's well-regulated THC industry has already built the framework and to discard this causes concern. Ms. Keller stated that staff will draft language as suggested. Council Member Rog noted the patient-centered care bill and asked how it fits into the legislative priorities. Ms. Ferris stated she will research and report back to the council, to which Ms. Keller added that staff will draft language on patient-centered care. 2. Does the city council want to add any of the council-initiated policy positions under the “New and changed positions” section of this report to the 2026 legislative position document? 3. Does the city council support the recommended draft 2026 legislative priorities? It was the consensus of the city council to agree unanimously with all three of the policy questions presented. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -8- Nov. 17, 2025 3. Revised budget Ms. Cruver presented the revised budget report. Policy considerations, budget timeline, highlights of the revised budget and urgent and emerging projects will be discussed. Ms. Cruver noted the policy considerations as follows: 1. Does the city council support a revised comprehensive city levy of $53,723,150, an increase of 7.49% reduced from the preliminary increase of 8.02%? 2. Does the city council support the recommended additions to the Capital Improvement Plan (CIP) to make critical repairs to the city hall and the aquatic center, and the plan to fund them through one-time transfers from the General Fund? On Sept. 15, 2025, the council approved a preliminary levy of 8.02% while also instructing city staff to find ways to reduce the tax burden on residential homeowners. The staff report includes the newest updates to the estimated 2026 property tax impact on residents, the updated proposed 2026 budget, including a reduction in the levy to 7.49%, as well as a proposed spending plan for emerging critical maintenance items discovered at both city hall and the aquatic park. Finalized calculations from the county, the lowered levy, and the additional tax capacity added from decertified TIF districts lower the tax increase on median homeowners to a projected 8.6%. This equates to a $154 increase in the city's portion of the property tax levy. Council Member Budd asked if the miscalculation will be included on the truth-in-taxation statement. Ms. Cruver stated it will not be included in the statement. Ms. Keller clarified that staff did not miscalculate; the earlier calculations were preliminary. Ms. Cruver added that calculating the rate is always a moving target as it depends on the levy and tax capacity, which are not static figures. Ms. Cruver noted the critical capital projects, including electrical equipment at the city hall building. This equipment has not been updated since city hall was built in 1963. The HVAC system and sprinkler systems need to be updated as well. Further projects at city hall include a safety lock in city council chambers and abatement work is planned. Council Member Rog asked what the plan was if the fund did not emerge to support these critical capital projects. Ms. Cruver stated that staff would have looked at additional bonding which would have increased the debt service levy in 2027. Ms. Cruver noted that in 2027 there is still space to bond for additional dollars as part of the multi-year plan to keep annual bonding under $10 million per year, which keeps costs lower and gets better rates for critical infrastructure needs. Ms. Cruver noted the aquatic center assessment. Within ten years, the project will need a complete remodel and some improvements must be made now. Electrical, whole pool surface renewal and ADA improvements are new additions to the aquatic center CIP. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -9- Nov. 17, 2025 Council Member Rog stated revenues from the aquatic park could be put into the general funds if revenue is higher than projected. Ms. Cruver stated that when more revenue is collected, the levy can be reduced by that amount. Council Member Rog asked if there was consideration to lower the fees at the aquatic park since revenues were high, noting that $10 can be a difficult fee for some people to pay. Ms. Cruver stated the increase in fees was about 2% and there was also an increase to the scholarship fund for families that cannot afford to participate in parks and recreation programming, including the aquatic center, to keep up with the fee increase. Council Member Rog asked how TIF impacts the school district and if it is true that the school district will receive $1.6 million. Ms. Cruver stated yes and Ms. Barton clarified that she believes the funds first go to the state and then are divided up. The St. Louis Park school district will receive their standard per-pupil funding from the state. Council Member Rog asked if the state LAHA funding would be threatened if the HRA amount is reduced. Ms. Barton stated that the city should be fine related to the state LAHA funding as it is dependent on a steady or increased spending on affordable housing programs, not on the revenues. Council Member Rog asked about the climate fund of $50,000 and proposed spending. She asked how staff made spending determinations considering that federal rebates are going away. Ms. Ziring stated that the most likely impacts will be seen affecting solar programs. While the tax credit for home electrification is being eliminated, there are many more significant rebate programs coming in 2026, especially if a person is at 150% Area Median Income (AMI) or below, so staff did not see a need to increase incentive levels for these projects. Council Member Baudhuin stated the levy is lower than expected and asked if there is a communication plan in place to notify residents. Ms. Cruver stated that staff will work on a plan and will provide more information at the Truth in Taxation public hearing on Dec. 1, 2025. 1. Does the city council support a revised comprehensive city levy of $53,723,150, an increase of 7.49% reduced from the preliminary increase of 8.02%? 2. Does the city council support the recommended additions to the Capital Improvement Plan to make critical repairs to the city hall and the aquatic center, and the plan to fund them through one-time transfers from the General Fund? Mayor Mohamed stated she supports both budget policy questions. The mayor thanked Ms. Cruver and staff for their hard work and for a levy that she is more comfortable with. Council Member Farris agreed and supports both policy questions. Council Member Farris thanked staff for all their hard work on the revised budget. Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C Special study session minutes -10- Nov. 17, 2025 Council Member Brausen stated he is also supportive of both policy questions and added that the city hall project needs to happen. Council Member Dumalag stated she supports both policy questions as well. Council Member Rog added that she also supports both policy questions. When the council committed to the Economic Development Authority levy, there was flexibility around it. Council Member Baudhuin added he also supports both policy questions. He recalled that in the last two years of budget work, the council was given a preliminary levy they were not comfortable with. In both years, staff took the council’s feedback and brought back a new proposed total, which is appreciated. It was the consensus of the city council to support the revised budget policy questions as presented. Written Reports 4. Single-family rentals update The meeting adjourned at 9:15 p.m. ______________________________________ ______________________________________ Melissa Kennedy, city clerk Nadia Mohamed, mayor Docusign Envelope ID: 7386BB07-95B4-4C7D-9D3A-B4D6ED9EC43C