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HomeMy WebLinkAbout2013/10/14 - ADMIN - Minutes - City Council - Study Session Iff St. Louis Park OFFICIAL MINUTES MINNESOTA CITY COUNCIL STUDY SESSION ST. LOUIS PARK, MINNESOTA OCTOBER 14,2013 The meeting convened at 6:30 p.m. Councilmembers present: Mayor Jeff Jacobs, Steve Hallfin, Anne Mavity, Julia Ross, Susan Sanger, Sue Santa, and Jake Spano (arrived at 6:37 p.m.). Councilmembers absent: None. Staff present: City Manager (Mr. Harmening), Deputy City Manager/Director of Human Resources (Ms. Deno), Director of Operations and Recreation (Ms. Walsh), Director of Community Development (Mr. Locke), City Assessor (Mr. Bultema), Director of Engineering (Ms. Heiser), Planmng/Zoning Supervisor(Ms. McMonigal), Controller(Mr. Swanson), Finance Supervisor (Mr. Heintz), Communications Coordinator (Mr. Zwilling), and Recording Secretary (Ms. Hughes). Guests: Susan Schneck and George Hagemann (Fnends of the Arts Board Members) and Victor Pechaty(Hammel, Green and Abrahamson, Inc.). 1. Future Study Session Agenda Planning—October 21 & October 28, 2013 Mr. Harmening presented the proposed special study session agenda for October 21st and the proposed study session agenda for October 28th 2. Friends of the Arts Annual Report and Update Ms. Walsh presented the staff report and introduced Ms. Susan Schneck and Mr. George Hagemann from Friends of the Arts (FOTA). Ms. Schneck advised that the Board completed a strategic planning process to clarify FOTA's mission, goals, and focus, adding that a big component of the strategic plan is redefining the roles of the Board and staff, including working toward hiring an executive director in 2014. She stated she will be leaving the organization in 2014 and is pleased to have been a part of the group. Mr. Hagemann stated the activities of FOTA are growing fast enough that volunteers cannot be expected to provide all the services at a level that are needed as well as to provide more of the things people are requesting of FOTA. He indicated that FOTA does not yet have the money to fund the half-time executive director position and acknowledged that funding the position will be FOTA's biggest hurdle but they are confident they can find funding. Councilmember Ross asked if FOTA has considered holding any fundraisers. Mr. Hagemann replied that FOTA has been exploring different funding models but believes it is most important for the organization to focus first on the change in leadership. Ms. Schneck indicated FOTA has avoided fundraising in the past because it felt that the organization has been able to find money through grants, adding that a key role of the executive director will be fundraising. Study Session Minutes -2- October 14, 2013 Councilmember Sanger asked if there has been or will be any efforts to encourage arts organizations not based in St. Louis Park to put on performances in the City or perhaps to set up a branch campus in St. Louis Park. Ms. Schneck stated that one of the questions that came up during the strategic planning process was whether FOTA wants to start thinking about space and geographic locations and FOTA determined that it needed a more solid structure and foundation before moving on to that level. Councilmember Mavity stated she would like FOTA to provide recommendations to the City Council on what the City can do to better partner with FOTA and to make sure that FOTA is given an opportunity to provide recommendations on projects, e.g., the community center. Councilmember Sanger urged FOTA to include dance and architecture in its programming. Councilmember Spano stated he would like to see FOTA collaborate with the schools and professional artists in the area to work with kids who are interested in becoming professional artists. Mr. Hagemann stated that FOTA is committed to increasing awareness of artists and arts organizations within the City and finding ways to connect with them. Councilmember Santa agreed with Councilmember Spano and stated the arts and culture grants should provide an opportunity for local artists to showcase their work. Mayor Jacobs expressed the City Council's thanks to Ms. Schneck and Mr. Hagemann and the FOTA Board for their work in the community. 3. Southwest LRT Update Ms. McMonigal presented the staff report and a proposed timetable relative to Municipal Consent. She pointed out that City staff and not SPO staff will present the overview of Municipal Consent plans at the October 28th study session. Councilmember Mavity requested that Council set aside sufficient time to discuss the list of betterments, including the Louisiana and Beltline station areas, and to discuss what changes can be made and the City's leverage after the Municipal Consent vote. Ms. McMonigal stated the items on the betterment list include the Louisiana Avenue south platform, the trail underpass at Wooddale, and either a trail overpass or grade separated crossing at Beltline. Councilmember Spano stated that a trail overpass east of the Beltline station was listed in the attachment that defined the project scope voted on by the CMC. Councilmember Mavity felt that having a grade separation at Beltline was absolutely critical and was concerned about potential budget implications to the City. She stated that Met Council wants to put a 600-vehicle park and ride at Beltline and suggested the City include a condition during Municipal Consent to make sure the City gets a grade separated crossing at Beltline. Study Session Minutes -3- October 14, 2013 Councilmember Hallfin stated he attended the Project Open House at Kenwood Community Center last week and made a suggestion about the possibility of removing the Wooddale station, given that the City has three stations within 1.5 miles of each other, and stated he would like to know the cost to build the Wooddale station. He explained his thought process was that pulling the Wooddale station could provide extra money for grade separation at Beltline, adding he felt it was most important to have a grade separated crossing at Beltline and because the decision on the reroute is going in the City's favor, he felt the City was not going to get much in the way of betterments. Councilmember Mavity strongly disagreed with the idea of pulling the Wooddale station and stated it was important to consider the economic development that would be lost by pulling the Wooddale station. Councilmember Santa agreed that the grade separated crossing at Beltline was critical and stated she felt strongly about moving the Louisiana Avenue station closer to Methodist Hospital. It was the consensus of the City Council to agree with the proposed Municipal Consent process and tentative schedule as outlined in the staff report. Councilmember Sanger requested further information about the role of Council during the required public hearing on the Municipal Consent plans. Mr. Harmemng stated the public will be invited to attend an open house prior to the public heanng and will be given an opportunity to provide input on the Municipal Consent plans. Councilmember Sanger requested that the notice state that the required public hearing on November 25th will be the only opportunity for residents to speak because there will not be an opportunity to speak when Council votes on Municipal Consent. 4. Community Center Project Ms. Walsh presented the staff report and advised that staff researched the recovery rate of community centers in surrounding suburbs and found a 50-90% recovery rate, noting the City used an anticipated recovery rate of 66%. Mr. Swanson reviewed the estimated tax and rate impact for several capital projects including a community center and explained that a $30 million community center would result in an estimated increase in the City's property tax share of$81 or an 8.6% increase over a two year penod and a $50 million community center would result in an estimated increase in the City's property tax share of$134 or a 14.4% increase over a two year period. He stated the community center would also need an operating subsidy of approximately $628,000 per year that would require a 2.4% levy increase to cover this operating loss or approximately $22 per year for a residential homeowner. He then reviewed the estimated tax impact as it relates to the sidewalks and trails program that results in an estimated $5-$7 per year property tax increase over an 11 year period. He also reviewed the rate based implications of the City's storm water projects estimated at $11 million resulting in an approximate $33 increase in utility rates over a period of five years or an approximate 46% increase to the current storm water utility rates. Councilmember Ross stated she supported the idea of a community center but was concerned about the cumulative effect of the property tax impacts and increased utility rates on the average Study Session Minutes -4- October 14, 2013 property owner. She was also concerned about the Federal government debt ceiling and how that might impact the City and felt this was not a safe time to undertake the community center project and felt the City should wait on it. • Councilmember Sanger did not think the City should wait and urged Council to consider the cost of not doing this project at this time. She felt it was important to keep on growing, developing, and improving the City to make sure families want to move into the City and she felt it was possible to tweak the plan to save money on some of the proposed amenities. Councilmember Spano stated the City only has one chance to get light rail done right in the community and he was very nervous about entering into a $45 million commitment for a community center knowing that the light rail project is coming. He added a scaled back version loses the wow factor and did not feel that scaling back the community center was the answer. He suggested that Council wait on the community center project until the City has further clarity on light rail. Councilmember Sanger indicated her idea of scaling back the community center project could include eliminating the drop-in day care because of its high operational cost. She stated if the community center project were delayed, higher bonding costs could take this out to 2029, which means there is no appreciable benefit to waiting two years before building a community center. Councilmember Hallfin stated he was torn about whether to proceed with a community center, adding it was a great idea and the community has asked for it during the visioning process. He stated there was no way to predict interest rates and if a community center project is put on hold, the City might miss out on low interest rates. Councilmember Ross stated she was not okay with bonding the entire cost of a community center at this time and questioned whether it might be possible to do the project in increments so the City does not have to put out so much money now. Councilmember Santa agreed with Councilmember Spano's comments about getting light rail done right for the community and waiting on the community center project until the City has a better handle on its costs. Councilmember Sanger requested that staff prepare some general calculations of what it might cost to do the Beltline underpass and some of the other enhancements that Council has talked about related to light rail and to provide Council with information regarding funding sources for all these projects, including how much the City would need to bond. Councilmember Santa requested that this information include potential partnerships with private or public entities. Mayor Jacobs stated he was torn about a community center project as well, adding it was clear the community wants this but he was not sure the community would be willing to pay $45 million for a community center. He indicated the City has several significant projects including light rail and Highway 100 and he was not comfortable moving forward with a community center project of this magnitude until the City is aware of the cost of all these other projects. It was the consensus of the City Council to direct that no further activity take place on the proposed community center project at this time. It was also the consensus of the City Council to Study Session Minutes -5- October 14, 2013 direct staff to work with Mr. Pechaty on costing out various components of the community center's programs as well as phasing opportunities available for the project. It was also the consensus of the City Council to direct staff to provide further information on the types of infrastructure improvements the City needs to be involved in either directly or indirectly with SWLRT and Highway 100 and to bring this matter back to Council in six months for further discussion. 5. 2014 Budget Review Mr. Harmening presented the staff report and policy questions for Council consideration. Mr. Swanson reviewed the 2014 budget recommendation highlights and advised that the City's health insurance rates came in favorably so the benefit contribution was decreased from $100 per month to $45-$50 per month. He stated those additional dollars would be put toward fund balance preservation to maintain the City's current fund balance position. He advised Council approved a 2014 preliminary property tax levy increase of approximately 3.5% that will be allocated to six different funds and pointed out the capital replacement fund-future debt service includes adding an additional $379,000 in 2014 for total of$645,000 that will be used to mitigate property tax impacts in the future. He stated the City's fiscal disparities contribution increased $730,000 from 2013 and explained the City is a net contributor of $3.67 million of its tax capacity and pointed out this amount is not a cash outflow but rather represents a reduction in the City's tax capacity of $60 million, meaning that it reduces the City's tax capacity by 1% and means that property owners pay a slightly higher share of property taxes. He added the 2014 budget also includes the maximum HRA levy of approximately$949,000. Councilmember Sanger expressed concern that the City's contribution to the fiscal disparities pool has doubled in two years and requested information about the recent study authorized by the legislature relative to fiscal disparities. Councilmember Mavity indicated the Metro Cities Board will be presenting a recommendation to the legislature to reevaluate the fiscal dispanties formula. Mr. Heintz presented the 2014 utility rate adjustments and discussed the changes to the City's contract for garbage/recycling/organics as well as the City's efforts to make sure services being provided are encouraged, e.g., organics, and decreasing resident's refuse cost and promoting recycling. He presented the proposed solid waste service levels comparison and rate comparisons, noting this matches the City's ten year plan of a 3% rate increase and continuing to move to a"pay as you throw"rate structure. Councilmember Ross requested the City consider having a system where residents are allowed to bring large items for recycling to the Municipal Service Center or some other convenient location. Ms. Deno agreed to have staff take a look at this. Mr. Swanson reviewed the estimated impacts to the City share of property taxes of both the utility rates and property tax levy increase of 3.5% and stated that a median value home would see an increase in 2014 of approximately $22.94 per year. He explained that approximately $39.80 is attributable to utility rate adjustments and a decrease of$17 is attributable to the City's Study Session Minutes -6- October 14, 2013 share of property taxes, noting that the reason for the decrease is a change in residential valuations with values dropping about $10,000 so taxes decreased about 1.8%. Mr. Bultema stated that if the City's home values were set tomorrow, the City's residential stock would be increased about 9% across all price brackets for taxes payable in 2015. He stated that commercial and industrial properties remain mostly flat because the City's stock is tight in terms of transactions that occurred; in addition, the City is going to be increasing apartment values. It was the consensus of the City Council to set the 2014 final property tax levy at $25,577,908 or approximately 3.5% over the 2013 final property tax levy. It was also the consensus of the City Council to continue to levy the full 0.0185% of estimated market value allowable for HRA purposes of $949,359 or approximately 5.38% over the 2013 amount to assist in paying for infrastructure needs in redeveloping areas. It was also the consensus of the City Council to approve the proposed utility rate adjustment plans for adoption on October 21, 2013. Communications/Meeting Check-In (Verbal) Councilmember Mavity requested that staff provide possible dates for the Council retreat as soon as possible. She also requested that Council have a discussion about climate change, either at the retreat or during a study session that includes a menu of things the City should be looking at to stay ahead of the curve on this issue. Councilmember Spano felt that the Environment & Sustainability Commission should be looking at this issue. Councilmember Sanger stated she has been contacted by some residents about their pick-up date for recycling and requested that the City put reminder information about recycling pick-up dates on the website. Councilmember Mavity suggested using the phone system as a reminder for residents. Mr. Zwilling stated that residents can look up their collection date by address on the website. Councilmember Spano stated the City is now a "Beyond the Yellow Ribbon" City and he attended the proclamation ceremony on Saturday. He presented the proclamation and challenge coin to Mr. Harmening. Mr. Harmening requested that Council provide feedback on the process for conducting the City Manager's annual performance evaluation. Councilmember Sanger indicated she liked the process that Council did with Jean Morrison. Mr. Harmening indicated that Ms. Deno will provide further information for council consideration of the evaluation process. The meeting adjourned at 9:04 p.m. Nancy Str�ity Clerk Jeff Jac bs, ► a or