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HomeMy WebLinkAbout2020/08/10 - ADMIN - Minutes - City Council - Study Session Official minutes City council study session St. Louis Park, Minnesota August 10, 2020 The meeting convened at 6:30 p.m. Councilmembers present: Mayor Jake Spano, Tim Brausen, Rachel Harris, Larry Kraft, Anne Mavity, and Margaret Rog (arrived at 7 p.m.) Councilmembers absent: Nadia Mohamed Staff present: City Manager (Mr. Harmening), Building and Energy Director (Mr. Hoffman), Director of Operations and Recreation (Ms. Walsh), CIO (Mr. Pires), Engineering Director (Ms. Heiser), CFO (Ms. Lammers), Police Chief Harcey, Fire Chief Koering, Deputy Police Chief Kruelle, Deputy City Manager/Human Resources Director (Ms. Deno), Director of Community Development (Ms. Barton), Finance Manager (Ms. Sledge), City Assessor (Mr. Bultema), Senior Management Analyst (Ms. Solano), and Recording Secretary (Ms. Pappas) Guests: Liz Diaz, Ehlers 1. 2020 COVID funding Mr. Harmening introduced Melanie Lammers, new CFO and Sharae Sledge, new finance manager. Ms. Lammers presented an overview of the federal guidelines and state of MN guidelines related to the Cares Act Funding, which will help address COVID-19 issues in the 2021 budget. Ms. Lammers noted eligible expenses as communications, medical supplies, payroll for services dedicated to COVID response, telework expenses and equipment and small business grants. She explained MN received $841 million for local government and St. Louis Park received $3.6 million in Cares Act funding. Ms. Lammers stated the city’s next steps include ongoing monitoring as well as monthly reporting to the state and preparation for a required audit . She added staff will work on 2020- 21 budget concerns and provide updates to the council as necessary. Councilmember Harris asked if within the public safety and staffing hours information, fire department hours are included. She noted specifically she was asking about the fire department outreach program going into senior housing during COVID. Ms. Lammers stated those hours are included. Councilmember Harris noted the city’s and state’s mask mandate, asked how enforcement is going and if police are noticing any costs related to that enforcement and if more resources are needed for that enforcement. Chief Harcey stated there have been very few complaints on mask violations, and if any are received, they are referred to inspections and community development for follow up, adding there have been no additional needs on enforcement to date. DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -2- August 10, 2020 Councilmember Harris asked if the weeks of community outreach and education on masks ha ve yielded positive results, whether there has been an uptick in calls for help or emergency calls related to mental health, and if this can be tied into living in a COVID pandemic world. Chief Harcey stated the force has looked at that from prior to March 1 through last week. He stated police had a meeting with the Hennepin County social worker and a slight uptick in calls was noticed, adding the social worker stated in general, the calls are related to COVID 19 and isolation issues. Councilmember Kraft asked for clarification on how the Cares Act funds can be used. He noted one part says it cannot be used for costs accounted for in the budget and asked how this relates to personnel expenses. Ms. Lammers stated if a person’s job duties became pandemic-related, and was not intended, but shifted to that, that position might be reimbursable, but staff must adhere to the guidelines. Councilmember Mavity asked if the definitions provided by staff are specific to St. Louis Park or from federal guidance on expenditures. She stated she assumes the city’s additional support for rental assistance is included here or under public health expense. She added as all kinds of housing instability begins to occur, she wants to be sure the city budgets for that . She asked if that will be through rental assistance or the public health budget and if the city needs more rental assistance, will it have the flexibility to provide that. Mr. Harmening explained that in the staff report, the $108,000 allocated to STEP for emergency rental assistance is noted . He stated this is above the normal $60,000 provided annually and includes the small business emergency assistance grants of $225,000. He added the city is planning to provide another $200,000 in small business assistance along with the county program, and that is accounted for . Mr. Harmening stated if the council wants to allocate additional funds, that would need to be discussed. Ms. Deno added the definition of economic support is spelled out in the reporting requirements and the city must follow the MMB guidance here as it is highly regulated. Councilmember Mavity stated she is not sure how quickly housing assistance gets to residents, adding she would need a report on that to put this into context. She added the city cannot meet all the needs, but a report would let the council know where demand is high . She added she is nervous about providing an additional $200,000 on business loans if the council is not aware of the needs of housing areas. Ms. Barton noted staff is in contact with STEP and thus far, STEP has only requested $30,000 of the $108,000 the city is providing to them . She stated STEP has not indicated they need additional funding at this time, however that may change in 2021. Councilmember Mavity thanked staff for this information, adding she is not requesting any additional follow up. Councilmember Brausen thanked staff for the report, noting he appreciates their judicious spending. He agreed with the staff recommendations on funds allocated to address COVID in 2021, appreciated the ways they are looking to spend, and staff’s creativity on this. DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -3- August 10, 2020 Councilmember Harris stated council received updates from Mr. Harmening on what might happen in St. Louis Park if any encampments were established. She stated she would like staff to investigate how many students and families in the city are not connected to STEP, and that might be in need currently. Councilmember Mavity added the liaison at the schools has data on homeless youth and that might be a good place to start for information. Councilmember Harris asked if the city’s small business assistance program assists the Gig economy within St. Louis Park. Ms. Barton stated in the first round of grant funding, funds were only eligible for business that had 3-25 employees and did not include Gig workers. She noted Hennepin County did not provide funding for Gig workers either and they were encouraged to apply for unemployment. Councilmember Harris asked if future city funding could include Gig workers. Ms. Barton stated the city was following Hennepin County criteria, so funding will not apply to Gig or self- employed workers, but she added this could be up for future discussion. Councilmember Harris asked how many Gig or self-employed workers there are in St. Louis Park. Ms. Barton stated she does not have data on that but can look into it. Councilmember Harris stated it behooves the city to support entrepreneurship, and she would like to support independent workers who are starting businesses as they help communities become strong . Councilmember Rog suggested supporting school districts with the purchase of hot spots and support technology for the city’s students. She noted if this fit into the CARES Act funding, she would support it. Mayor Spano agreed and stated any way the city can support the school district is an obvious opportunity. Ms. Deno stated staff will continue to look into this with the schools, but added guidelines are very specific as to how funding can be used for technology in schools . Mayor Spano asked if St. Louis Park’s spending ratio for the CARES Act funds are similar to what other cities are spending. Ms. Diaz stated she has been working with various cities on this, and some are using all of it for their payroll, and in a variety of different ways. She noted some are using the funding for public safety. Ms. Lammers explained the guidelines are so broad and allocations have been all over the board in other cities, noting that every entity has different needs. Mayor Spano understood this and added he would like staff and council to be aware of any needs that we might be missing. He asked about masks and the status of spending on them for distribution to residents. Mr. Harmening stated the city received 100,000 disposable masks from the state for businesses and non-profit uses. He stated the city has dispensed 70,000 of the masks, adding that 5,000 masks have been ordered. DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -4- August 10, 2020 Chief Koering added the 5,000 masks ordered are to be washed and reused and were supposed to be at the city last week, but the order has been delayed. He stated those 5,000 masks are already spoken for within the race equity and inclusion are a, which is an historically underserved population and has needs for masks. He added an additional 1,000 masks have been allocated to operations as well. Ms. Deno stated staff will continue to update the council monthly on finances and plans as they move forward. 2. 2021 Budget Mr. Harmening stated this will be a high-level overview of the 2021 budget and more discussions will happen between now and December when the final levy is adopted. He added based on early conversations with the council, staff heard they wanted to consider a levy increase of 3% or less for 2021, while the HRA levy is up because home values are up . Ms. Lammers stated once the levy is decided on by council, it can go down, but not up. She reviewed the levy increases since 2014 and noted the HRA levy is proposed at the maximum of value, which is $182,000 or 0.185%. She stated staff will be back at the Sept. 14, 2020 meeting with more information on this as well as franchise fees. Councilmember Kraft referred to the tax capacity and analysis slide and asked what the fiscal disparities pool is. Mr. Harmening explained that state law affects the metro area only, where commercial and industrial property value in taxes are shared across the metro area. The funds go into a pool and a formula is used for distributing the tax base. Cities with very little industrial properties, benefit from sharing in this pool. Mr. Harmening stated St. Louis Park is a net distributor to the pool and there are other cities that benefit from this across the 7-county metro area. He added this fact shows St. Louis Park has more diversity of business, industrial, commercial, and residential. Mr. Bultema noted the city is in the top 15 for net contributors. Ms. Diaz added in 2020, $10.9 million of tax was distributed and $5.7 went back to the city, allowing for a $5 million net contribution. Councilmember Kraft asked regarding the tax capacity increase, what portion comes from the value increases from what’s currently there, or from something new, or from something being allocated to TIF. Mr. Bultema stated market appreciation accounts for the vast majority of this, while new construction goes up and down. He noted last year’s new improvement value was 0.8%, and the base is $8 million, so it takes a lot of improvements to add up. Councilmember Kraft added the analysis is always based on a typical home, but valuations on apartment homes are going up more. He stated he would be interested in seeing a rental analysis and on the utilities portion also. Mr. Harmening stated franchise fees have increased every other year and in 2021 , they would increase again. He noted these fees are tied to capital improvement needs and all fees go to pavement management programs vs. using a levy or special assessments to residents. DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -5- August 10, 2020 Ms. Lammers added several pieces of debt are coming in 2021 related to constructions projects such as Westwood Nature Center and Connect the Park. Councilmember Kraft stated he is interested in the Dakota Bridge also, and with the priorities the city has, how much will this cost in future years, noting it seems debt service will be going up more next year. He added given the recession and cost of living adjustments, he feels 2% is on the high end for increases. Councilmember Harris noted infrastructure improvements and how with 100-year rainfalls happening more often, does the proposed budget include enough resources for continuations of updating the stormwater infrastructure. Mr. Harmening stated the city has a capital plan for the storm water infrastructure that is prepared each year and is tied to the utility rates and then built into the CIP each year. Councilmember Harris stated she would find value in a map of low spots in the city and compare this to localized flooding. She asked if the city is approaching localized flooding issues and creating long-term solutions. Mr. Harmening stated staff will come back to council on the CIP, discuss further the stormwater plan, where there are deficiencies, and the entire capital plan. Councilmember Harris added she appreciates a cap of 3% levy, adding it seems more fitting to have a cost of living increase of 1% given the financial situation. She added she does value staff and supports their raises; however, this is not the case right now. Councilmember Brausen pointed out the effective tax rate of 3.0% vs. 6.2% and asked, at a 3% levy increase, if this will result in the city tax rate actually decreasing next year. Ms. Lammers stated that is correct. Councilmember Brausen asked if the council decided on a 6.2% increase, would the city tax rate effectively stay the same. Ms. Lammers stated that is correct . Councilmember Brausen asked about the proposed environmental and sustainability budget and the recommended $1.27 million to pay for goal #4. He also asked about the $1.5 million allocated now. Mr. Hoffman stated this is correct adding the budget shows the magnitude of the city’s environmental goals and working to reach them . He added to create an incentive takes large programming from the city, but this has not been plugged into the budget yet and the city has to agree to take it on. He stated staff is now looking at 2021 to reaching out on this incentive program. Councilmember Brausen stated the sustainability project is $23 million over 10 years and if this comes out of the 2021 budget, it will have to be put back in at that amount over 9 years instead. He stated he prefers to keep it in the budget, adding this will impact increasing the levy. He noted there is never a great time to start but given the overall impact, he is more comfortable with a 5% range levy increase in order to fund a more robust climate action plan, adding the more time that is wasted, the worse it will get . Councilmember Brausen stated 5% is prudent and is in line with our historical numbers. He added citizens will require more help and there will be fewer social safety nets from the state, DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -6- August 10, 2020 but the vast majority of St. Louis Park residents are still employed and the vast majority of taxpayers can handle this in order to keep the services they are accustomed to. He stated he would rather error on the higher end, adding maybe there should be no staff increases this year to compensate. Councilmember Mavity stated with the 3% levy, on average, that is a $3 per year impact on residents. Ms. Lammers stated that is correct, adding it is a $3 decrease for the year. Councilmember Mavity added at 6%, this would be a $38 per year increase. Ms. Lammers confirmed this as well. Councilmember Mavity stated while this number varies on the value of a home, this is an average barometer of the impact and in general, $38 per year is not a dramatic cost when spread over 12 months. However, she stated the city does need to be cognizant we are experiencing a recession or depression of historic proportions, and without knowing what is ahead, this gives reason to be more cautious. She stated she prefers to stay more toward 3% unless staff has good reason to move this higher. She added in the end, the community could tolerate a higher levy, but added it may affect many older citizens who are on a fixed income. Councilmember Mavity asked about requests for additional staffing and if the schools still have police officers. Chief Harcey stated yes, they do, if schools are open. Councilmember Mavity stated she feels data tracking is the most important piece of funding the police, noting council has asked for data to be tracked by race, and the data can be used if needed to support in areas that need adjustment . She stated if this data gathering work requires an additional person, she will support that. Councilmember Rog stated she is supportive of the 3% levy and not hiring additional staff . She is also supportive of the HRA levy and while she does support additional staff for racial equity work, she would like to know more about outcomes of this work. She is also interested in consideration of council salaries and would like those increases to be in line with staff increases. Ms. Deno pointed out, as a practice, council salaries are always in line with staff increases. Councilmember Kraft asked with all the outreach conducted during COVID, are additional resources needed for outreach in three additional positions. Councilmember Kraft also noted climate crisis and agreed with Councilmember Brausen. He stated he is interested in how the city starts building these costs into the budget and added benefits must be included in the report, as well as alternative resources. He stated he would like to see these amounts and estimates built in, adding there may be a unique way to do this or to structure investments to outweigh benefits over time. He added he is concerned about increasing the levy from 3%, especially while in the middle of a racial, COVID, and climate crisis all at the same time. Councilmember Brausen added the public safety city organizational charts only show public safety and police, and do not show the four officers that are school liaisons and/or DARE officers. He is interested in how the officers are allocated to the school, what type of issues they deal with, as well as outcomes. He appreciates the fact the city supports the schools in this DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -7- August 10, 2020 way, but with climate, racial equity, and COVID, we may need to look at school districts sharing some of that cost with the city. He stated he would like to discuss this before the Sept. meeting. Councilmember Rog agreed and would like to hear from the school superintendent on SRO and DARE programs as well. Mayor Spano asked about the transition from paid on call to full-time fire fighters and about how the costs will balance out. Fire Chief Koering stated he will do a presentation on this for the Aug. 24, 2020 meeting and provide details and the benefits of moving staff and resources around. Mayor Spano asked about the police training budget increase and what is the current police training budget. Chief Harcey stated it is currently $70,000 and a $10,000 increase will help the police force meet the mandates of the reform bill. Mayor Spano stated he would like more information on the trainings in order to get a better sense of them. Mr. Harmening stated staff will be prepared to provide a report on this at the Aug. 24, 2020 council meeting. Mayor Spano stated he is comfortable with the 3% levy for now, but there will be more questions from council and more clarification needed before council gets to the final number. Councilmember Kraft asked about the CARES Act funds and impacts from 2020 on 2021. He also asked if the city can increase general reserves, could that impact 2021. Mr. Harmening stated the best example of impacts on 2021 budget relate to savings in staffing costs in 2020 . He stated if the Cares Act pays for legitimate staffing costs and results in some savings, at year end that could potentially increase the fund balance and provide an opportunity to have a backstop for 2021 COVID impacts, such as property taxes not being paid or other costs experienced. He added the policy is that the general fund balance is 45% of the full balance, so any surplus then can address COVID impacts in 2021. Councilmember Rog noted the Cleargov.org portal is very beneficial about where money is going. She added she supports this tool and encouraged the council and residents to look at it. 3. Future study session agenda planning and prioritization Councilmember Harris stated she submitted forms on the housing stabilization fund using CARES Act funding but noted this might not be needed since the city has already funded STEP for emergency rental funds. Councilmember Mavity stated the city has the housing trust fund, an existing vehicle to allocate and administer funds if needed, so there is a way to support this already. Councilmember Harris asked about creating a public health coordinator role at the city, noting that many other suburban cities have this role on their teams. DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -8- August 10, 2020 Councilmember Brausen stated designating this position seems to be the role of the city manager and the council has given him our priorities, but he should decide if t his is a role and expenditure the city needs. He would prefer this over discussing it at a study session. Councilmember Kraft stated he would be interested in a discussion of this. Councilmember Rog stated she does not feel this is the time to add a public health official, but noted there is value in having an expert in this area on staff, and it does fit well with the council’s planned conversations about community policing. Councilmember Mavity agreed this is an important issue but should be discussed within the broader policing discussion. Mayor Spano stated he is not interested or supportive of creating a staff role for this, but added it is up to Mr. Harmening to decide if it is needed . He stated other cities have their own public health departments, but St. Louis Park’s is run by Hennepin County. He also agreed this should be discussed around policing and public safety. Mr. Harmening stated staff will prepare a report for council on how public health is addressed in the city and provide a better picture of how it looks today, while including police and other aspects of public health as well. Councilmember Brausen noted the Dakota pedestrian bridge project written report, which is over budget again. He reiterated his support and encouraged staff to sign the contracts and do the project now as it won’t get cheaper in the future. He stated it is a major public works project that the city has promised, and the community wants it done. Councilmember Kraft stated the project fills a gap in our network; however, he is very concerned about the debt and increases in coming years on the levy. He questioned the benefit of the bridge, how many will use it, how many car trips are eliminated per day, and what will it do for the city. He added he is increasingly uncomfortable with the price of it. Ms. Heiser stated the cost noted in the report is the most current and added she will provide debt service information in the next report and will present that at the Aug. 17, 2020 meeting. Mr. Harmening noted for the Mon., Aug. 17, 2020 meeting, staff can provide a compilation of existing debt and future debt for this project and others for the next 5 years, so council can see how things fit together in the long term. Councilmember Kraft added he would like to see more than just one year on the budget especially as it relates to climate crisis. Mr. Harmening stated staff has a tool that is all built on assumptions and can be manipulated to include a long-range model. He stated this will be reintroduced to council. DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22 Study session minutes -9- August 10, 2020 Communications/meeting check-in (verbal) Councilmember Kraft noted work being done on the Trillion Trees program, which is a concept where if one trillion trees are planted around the globe, it would not solve climate change, but would help as a key tool to remove gases. He noted if this is translated to St. Louis Park, and tree planning is increased to 1,000 trees per year, we can make a difference. He noted this project is early in discussions and partnerships and structure are being investigated, but Mr. Harmening suggested he update the council on it. Mr. Harmening stated staff has brought in Tree Trust to work on this also, and there will be more information to come. Ms. Solano stated on Wed., Aug. 12, from 5-5:30 p.m., there will be a ribbon cutting ceremony for the Walker Lake mural. She stated an email with details will be sent to council and noted all attending should wear face masks and social distance. The meeting adjourned at 8:55 p.m. Written Reports provided and documented for recording purposes only: 4. Update – PLACE’s Via project – mechanic’s lien 5. Update for Dakota Ave Bikeways and Dakota Edgewood Trail Bridge – project 4019-2000 ______________________________________ ______________________________________ Melissa Kennedy, city clerk Jake Spano, mayor DocuSign Envelope ID: B4FE57CE-D6CD-434C-86C9-D060BAC92C22