HomeMy WebLinkAbout2013/06/17 - ADMIN - Minutes - City Council - Study Session If/ St. Louis Park OFFICIAL MINUTES
MINNESOTA CITY COUNCIL SPECIAL STUDY SESSION
ST. LOUIS PARK, MINNESOTA
JUNE 17, 2013
The meeting convened at 6:00 p.m.
Councilmembers present: Mayor Pro Tern Susan Sanger, Steve Hallfin, Anne Mavity, Julia
Ross, and Sue Santa.
Councilmembers absent: Mayor Jeff Jacobs and Councilmember Jake Spano.
Staff present: City Manager (Mr. Harmening), Deputy City Manager/Director of Human
Resources (Ms. Deno), Director of Community Development (Mr. Locke), Planning/Zoning
Supervisor (Ms. McMonigal), Controller (Mr. Swanson), Communications Coordinator (Mr.
Zwilling), and Recording Secretary(Ms. Hughes).
Guest: David Mol, CPA (HLB Tautges Redpath, Ltd.)
1. Southwest LRT Update
Mr. Locke presented the staff report and distributed several maps that display the existing freight
rail car volumes, future freight rail car volumes for the Brunswick West and Brunswick Central
alignments, freight rail track height over and above existing heights for the Brunswick West and
Brunswick Central alignments, and freight rail track construction for the Brunswick West and
Brunswick Central alignments. He stated the maps illustrate impacts in terms of freight rail
volumes noting there would be a significant increase in volumes on the proposed reroutes. He
advised the maps depict more use of right-of-way for the Brunswick West and Brunswick
Central alignments and the maps illustrating rail track height show dramatically increased
elevations in some places. He explained that the large map depicts the colocation route
beginning near the Penn Station in Minneapolis extending through St. Louis Park to the
Louisiana Avenue station area and under a colocation scenario, the entire MN&S route in the
City primarily stays the way it exists today with no change to how the trains operate, i.e., at
grade crossings (including at grade crossings at Wooddale and Beltline), proximity of the line to
the high school, and the way trains go through neighborhoods, with changes occurring to the east
of this area. He stated the map shows the regional trail going below Wooddale with a grade
separated trail but no grade separation for light rail or freight rail thus creating traffic impacts
especially during peak hours. He indicated that staff has been exploring what improvements
could occur at Wooddale to help alleviate or overcome these traffic impacts, including a grade
separated crossing for freight rail and light rail, noting a grade separated crossing for freight rail
presents grade challenges for trains traveling into Minneapolis. He stated that impacts related to
having freight rail continue at grade at Wooddale include how to deal with the traffic, including
emergency vehicle access, and having freight rail in the station areas potentially affecting
pedestrians and bikes. He advised that all the light rail stations are on the south sides of the
corridor under all the alternatives including the Louisiana Avenue station area being moved to
the south to follow the old wye. He stated the Highway 100 project is ahead of the light rail
project and will require replacing the bridge for freight rail no matter where freight rail is routed
and the expectation is that there will be a bridge capable of handling freight rail built into the
Highway 100 crossing. He explained that the Beltline crossing will experience the same kinds of
traffic impact issues as Wooddale and the SPO is showing the trail going over Beltline regardless
of whether there are freight trains at this location. He stated the map depicts freight rail present
in this area and shows the trail going over both freight rail and light rail and shifts the trail from
the north side to the south so it aligns with the Midtown Greenway. He advised that traffic
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impacts in this location are significant and the SPO is not proposing any change in the at grade
crossing and proposes some signalizing to protect the freight rail corridor traffic from backing
up. He stated the City feels it would be wise to take Beltline underneath freight rail to grade
separate the road from light rail, freight rail, and the trail to improve circulation in this area given
Beltline's importance as a key transportation link. He added this might also create some
opportunities for the way in which sites immediately surrounding the area are developed.
Mayor Pro Tern Sanger felt the City should request a tunnel or underpass for Beltline regardless
of whether a colocation or reroute is selected because the addition of light rail will make the
traffic congestion in this area significantly worse.
Councilmember Mavity noted that when light rail crosses at grade the light rail trains do not ever
stop in the intersection so the crossing is quicker than when stopped at a red light.
Mr. Locke indicated the City has asked the SPO to address freight rail delays when trains are not
operating on schedule and the City needs to understand what happens in those scenarios.
Councilmember Mavity requested clarification that the south connection is going in under every
scenario and at this point no trains will travel north coming from the west. She stated that in any
scenario it would be important to keep trains moving because moving trains have lighter impact
than stopped trains. She was concerned about the potential for a northern connection under a
colocation scenario since the wye is being removed and trains coming from the south stopping
and making noise, adding if the trains have to stop in order to go north, there needs to be a
northern connection for the lighter freight rail traffic.
Mr. Locke noted that if train traffic on the Bass Lake Spur is trying to get to the north and the
wye is removed, the trains would connect to the MN&S tracks by first going to the south and
then to the north on the existing MN&S tracks.
Councilmember Mavity stated this could potentially block Alabama Avenue. She urged the City
to plan ahead to make sure that does not happen adding she did not want to see this become a de
facto switching yard.
Mr. Locke discussed impacts on redevelopment opportunities stating the City has a policy to
pursue strategic acquisitions from willing sellers in key locations and the City is pursuing an
opportunity in the Beltline area that will be presented to Council in the near future. He stated
that light rail, freight rail and the trail all continue through the eastern portion of the City into the
Kenilworth corridor and the SPO has explored six colocation alternatives through Kenilworth.
He explained there are a couple of pinch points along this corridor with a key pinch point north
of the Lake Street bridge with only 49' of right-of-way by the Cedar Lake townhomes. He stated
if the trail, light rail, and freight rail are co-located in this corridor, the right-of-way needs to be
94' and would require acquisition of 33 units of townhomes in order to obtain sufficient right-of-
way. He indicated there are also twenty condo units on the west side of the corridor south of
Lake Street that need to be acquired under all the alternatives; and, one parcel, an apartment
building in the southwest quadrant of Cedar Lake Parkway, that is needed only for the alternative
that accommodates freight rail, LRT and the trail at grade. Mr. Locke stated that the existing
right-of-way of 139' in the vicinity of the 20 townhomes south of Lake Street on the west side of
the corridor is sufficient for SWLRT light rail trains, but if this area has to accommodate a
platform and tracks on either side of the platform for the proposed Midtown Greenway trains, the
right-of-way needs to be approximately 150' and would impinge on the existing townhomes. He
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added that another key acquisition is the narrow area shown on the plans as cross section C. For
there to be sufficient ROW in this location, property owned by BNSF is needed.
Councilmember Mavity requested that the SPO provide a cost comparison for changing the Lake
Street Bridge or taking the 20 townhomes.
Mr. Locke pointed out the Midtown Greenway train configuration shown on the map is only one
of the options being looked at and stated the City has asked whether the platform can be moved
to avoid needing to acquire the 20 townhomes.
Councilmember Hallfin asked about the timeframe on the Midtown Greenway.
Mr. Mark Fuhrmann from the SPO approached the City Council and stated that Met Council
received a $1 million Federal grant to conduct an alternatives analysis and this analysis is well
underway.
Mr. Locke discussed the tunnel versions, elevating the trail or elevating light rail as well as
relocating part of the trail and stated a deep bore tunnel would be thirty to forty feet below the
trail and freight rail and would start around the Lake Street bridge and come out just before the
Burnham bridge for a distance of approximately 4,100'. He added a shallow tunnel would begin
north of the Lake Street Bridge for a distance of approximately 2,800'.
Councilmember Ross asked if the properties in this area would still need to be acquired if a
tunnel were constructed.
Mr. Locke replied in the affirmative. He indicated the City has asked the SPO to consider a
version of the shallow tunnel option that did not have freight rail on top of the tunnel because of
the significant engineenng issues with having freight rail traveling over a tunnel.
Mayor Pro Tern Sanger asked if the current Burnham Bridge would remain as is under any of the
elevated options.
Mr. Locke indicated he was not sure how elevated trains would handle the bridge, stating that at
some point the trains have to come down to the surface to join the BNSF tracks beyond the Penn
Avenue station. He noted that if freight rail were co-located, the Cedar Lake trail across the
north end of Cedar Lake would have a bridge over both freight rail and light rail to connect back
to the existing trail in the vicinity of the Penn Avenue station.
Councilmember Santa requested confirmation that no businesses would need to be acquired
under this scenario.
Mr. Locke replied that this was correct.
Councilmember Mavity stated it was becoming clear in looking at the Louisiana station in the
Elmwood neighborhood and all points south that this becomes a circulation issue from that side
of Wooddale and questioned whether there was an opportunity to explore grade separation
between the frontage road and Alabama Avenue.
Mr. Hanmening advised the City has been considering whether to submit a proposal for project
costs or mitigation or betterment not covered by the SWLRT project in the Governor's bonding
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bill package for 2014 and stated the deadline for submitting material is Friday, June 21. He
pointed out that the City's legislators can propose something to be inserted in the 2014 bonding
bill when the session starts later this fall and indicated it might make sense to wait to see where
Met Council comes in with its recommendation for freight rail, adding this would also allow time
for the City to determine what it wants from mitigation and whether to form a coalition with
other cities.
Mr. Locke advised that staff would present a draft of the City's comments for review by Council
next week.
2. 2012 Financial Statements—Auditors Discussion and Review
Mr. Swanson presented the staff report and introduced David Mol, CPA, from HLB Tautges
Redpath, Ltd.
Mr. Mol advised that the reports issued by the auditor includes an opinion on the fair
presentation of the financial statements, a report on internal controls, a report on compliance with
the Minnesota legal compliance audit guide, and a report on communication to those charged
with governance. He stated the financial statements are audited based on GAAS and GAGAS
standards in order to obtain reasonable assurance that the financial statements are free of material
misstatements and the City's audit resulted in the issuance of a clean opinion or unmodified
opinion. He indicated the City has received the GFOA award for excellence in financial
reporting for several years and the 2012 financial statements will again be submitted. He stated
the report on internal controls is intended to gain an understanding of internal controls in place
and perform tests to determine compliance but does not audit or opine on the City's internal
controls. He advised that one item was noted related to revenue recognition and capital assets
for revenue received from Hennepin County in 2012 for Northside Park that should have been
recognized in the prior year when the project was started.
Mr. Harmening explained that in this case, the City accounted for this revenue in 2012 instead of
2011.
Mr. Swanson stated this revenue came in through the City's CLASS system and was a non-
routine item. He advised that staff will forward non-routine items to accounting staff to make
sure the item is coded properly in the future.
Mr. Mol stated the report on compliance with the Minnesota legal compliance audit guide
resulted in no findings of noncompliance after a sample of transactions were tested for
compliance in seven categories, e.g., depositories of funds and investments requires that dollars
on deposit at a financial institution be covered by FDIC or collateral and the audit tests for
compliance with that section. He advised the auditors noted a change in how the City accounts
for capital assets with the City moving to a Modified Approach with no recording of depreciation
and instead recording the capital asset.
Mr. Swanson stated the City uses the Modified Approach in the Pavement Management Fund
because the City has solid tracking of assets and costs in this Fund. He stated the City is looking
to expand the use of the Modified Approach in its trails system and utility systems.
Mr. Mol advised that accounting estimates in the financial statements include an obligation for
post-employment benefits of $1.6 million. He stated the financial statements include two
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immaterial adjustments including understatement of property taxes receivable and explained this
relates to how Hennepin County provides the information to the City; for the period 2007-2010
the County was reporting a negative receivable. He advised that staff spoke with the County to
make sure there was not a payable and learned the negative receivable is how the County handles
their adjustments related to property owners with contested valuations and in this case, the
amount was $86,000.
Mr. Swanson explained that when a property owner is involved in a tax court case and the
property value is reduced, the County takes it out of the City's delinquent tax settlement numbers
rather than having a separate line item on the County's tax settlement numbers. He added that
Mr. Mol and staff would work with the County to resolve this issue.
Mr. Mol advised that no disagreements or difficulties with management were encountered in
performing the audit. He then presented a 2012 financial summary showing the 12/31/12 ending
fund balance of$109,871,000 and cash balance of$68,902,000.
Mr. Swanson stated the General Fund target is 45% and came in at 45.16% and pointed out this
includes transferring over $1 million from the General Fund. He stated the Special Revenue
Funds remain stable and have had no significant cash outflows; the Capital Projects Fund overall
position has declined due to completion of the fire station projects and represents a planned
declination in the fund balance; the Enterpnse Fund remains stable due to an increase in rates to
plan for future capital needs; and the Internal Service Fund decreased slightly due to uninsured
losses.
Mr. Mol reviewed 2012 revenue sources and 2012 expenditures for all funds as well as
constraints on the fund balance totaling $61 million. He explained that these constraints are for
items not available for spending, e.g., the housing rehab fund represents loans issued by the City
and not available for reuse until the loans are collected. He advised the General Fund has
unassigned funds of $10,757,000 and the City's policy is to maintain 35-50% of its operating
budget in the fund balance. He reviewed General Fund working capital needs, history of the
General Fund balance as well as the City's outstanding debt at year end. He then reviewed the
City's Enterprise Funds and history of the City's tax levy'and tax rates stating that the City is a
net contributor to fiscal disparities with 4.7% of tax capacity contributed elsewhere in the metro.
He indicated the City had overall good results for the 2012 audit with a clean opinion.
Mayor Pro Tem Sanger expressed the City Council's thanks to Mr. Mol and Mr. Swanson.
The meeting adjourned at 7:27 p.m.
Nancy Stroth, ty Clerk Susan Sang r, Mayor Pro Tern