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HomeMy WebLinkAbout2021/07/26 - ADMIN - Minutes - City Council - Study Session Official minutes City council study session St. Louis Park, Minnesota July 26, 2021 The meeting convened at 6:30 p.m. Councilmembers present: Mayor Jake Spano, Lynette Dumalag, Rachel Harris, Larry Kraft, Nadia Mohamed, and Margaret Rog Councilmembers absent: Tim Brausen Staff present: City Manager (Mr. Harmening), CFO (Ms. Schmitt), Planning Manager (Mr. Walther), Communications and Marketing Manager (Ms. Smith) Guests: David Moll, Redpath and Co., Auditors 1. 2020 Certified Annual Financial Report presentation David Moll, Redpath and Co., presented the 2020 report. David Moll noted the city has received the excellence in financial reporting from GFOA for the 37th consecutive year. They stated a clean opinion was issued on the 2020 financial statements for St. Louis Park, and there were no items of noncompliance noted. David Moll added the city has complied with various requirements of federal programs including coronavirus relief fund and the Dakota bridge project. Mayor Spano asked how the COVID relief funds complicate the auditors’ work both in St Louis Park and in other cities. David Moll stated the difficulty related to what was allowable and what wasn’t. They added the treasury guidance did make this easy, however. Ms. Schmitt agreed, noting staff was in communication ongoing with the auditors. Councilmember Kraft asked if the report council received on June 28, 2021 was expected to be the final report. David Moll stated yes. Councilmember Kraft noted one entry related to liabilities was incorrect and asked if that was materially incorrect. David Moll stated yes, adding the summary included had an error in the total amount, however, the financial statements were fairly stated. Councilmember Kraft asked what the process was that allowed an error to come through and how this will be avoided in the future. David Moll stated the error was in a journal entry related to capital assets. There was an amount that was repeated twice in the journal entry. Ms. Schmitt stated this was missed on the journal entry originally, and then it was caught when reviewing final reports. She added in the future staff will have a better method of reviewing the entries to ensure the right controls are in place. Also, Ms. Schmitt stated the amounts were sent to the auditors very late in the process, so that was a factor in the error . Councilmember Kraft stated in next year’s audit report, he would like to see how staff corrected this process over last year. DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188 Study session minutes -2- July 26, 2021 Councilmember Kraft asked if the auditors look at the discussion or the financial statements . David Moll stated they tie the numbers to the financial statements and summarize it . In this case, there is an error, but noted they do proof the document page by page and they are not sure how this was missed within the proofing process. He stated ultimately it is their error and they take ownership of it. Councilmember Kraft asked about the current NDNA, noting there is still a small error, and asked if he is correct that it is in the table on pages 28 -29. David Moll stated on page 29, one of the numbers was updated. Councilmember Kraft asked how much of an issue this is. David Moll stated the financial statements, and the table are correct; however, the text discussion has an incorrect number. Mayor Spano clarified the finances are not the issue, but the reporting of the finances is the issue in this instance. David Moll stated that is correct. Mayor Spano stated in the future staff will create a plan to avoid mistakes such as this. Mr. Harmening stated no one wants to see errors; however, he is confident in the finances of the city. 2. Zoning and land use change at Minnetonka Boulevard and Highway 100 Councilmember Rog stated in Ward 1, she has had questions from residents as to what will be happening in this location as it relates to access. She added many are interested in medium- density housing for this site and she is happy to be discussing this tonight . Mr. Walther stated this site is attractive to commercial and multiple -family residential. He noted staff has had meetings in the past with the previous owner of the land, and they were very interested in re-opening in this area. He stated the city rezoned the property from general commercial to neighborhood commercial following adoption of the comprehensive plan. While both allow residential as part of a mixed-use building, it doesn’t require it. If council desires to see residential use, the present zoning may not produce that result, and an auto-oriented commercial use seems more likely under the present zoning. He also noted MnDOT should be contacted about any land use and zoning changes that the city would want. This is a policy decision by the council. Councilmember Harris asked what the timeline would be for MnDOT to sell the parcel. Mr. Walther stated he does not know; however, it would likely be within months, not years. Councilmember Harris stated the staff report shows the population density there is not enough alone to support the local businesses, they rely on passing vehicle traffic as well as the residents in their service area. Councilmember Harris stated the city goals of being more walkable and bikeable make this location a good place to add more residential and to focus on neighborhood vitalization, near neighborhood businesses. DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188 Study session minutes -3- July 26, 2021 Councilmember Mohamed added she is also in favor of rezoning to residential and looks forward to what type of development comes from this area. Councilmember Dumalag asked about the parcel and arrangements of it . Mr. Walther stated MnDOT indicated it must give the former owner the first right of refusal after taking the property under eminent domain for public purposes. Councilmember Dumalag stated she is also in favor of residential on this parcel. She asked for the definition of rooming house. Mr. Walther stated it is lodging for between 3-8 persons provided by an owner-occupied building, with no provision for cooking in the rooms occupied by lodgers. He added the lodging is provided on an extended basis rather than daily or weekly. Councilmember Kraft stated there is contamination at this site and asked about the impacts and amount of clean-up that would occur there to make it safe. Mr. Walther stated it depends on the land use and would most likely require more mitigation for residential compared to commercial uses. He stated the contamination is on the low-end in complexity compared to some other areas within the city, adding this clean-up would be manageable. Councilmember Kraft added he is also supportive of rezoning for residential. Councilmember Rog noted there will be a public process on this and looking into rezoning. She thanked the councilmembers for their support and asked if the city would retain right-of-way until the area was developed. Mr. Walther explained MnDOT states this is excess right-of-way, so there is no vacation process for the city to go through . He added this area is guided as right- of-way in the city comprehensive plan now but there might be a need to change this, and it would be up to council to give staff direction here. Councilmember Rog asked about the size of the parcel. Mr. Walther stated he has not seen a legal description, but noted it is approximately 1.2 acres. Councilmember Rog asked if medium density allows for 30 residential units at the parcel. Mr. Walther stated yes, and depending on what the council decides, those wishes will be conveyed to developers. Councilmember Harris asked about examples around the city that might be similar density. Mr. Walther stated example developments would be Wooddale Flats, Arlington Row, and the townhomes on Texas Avenue near Wayzata. Councilmember Harris asked if the lower density would yield more expensive rents or more expensive purchase prices. Mr. Walther stated the per unit costs could be higher for construction compared to high density residential, adding it varies widely by the type of development. Councilmember Harris asked if the higher prices might be detrimental to affordable housing goals. Mr. Walther stated it may be challenging to achieve 30 units on this site under the proposed R4 zoning, but fewer units would be less complicated. Councilmember Harris asked if it is fewer units per acre, how would that impact the city’s inclusionary policy and affordable housing goals. Mr. Walther stated if built under the R4 zoning and there is not a request for tax increment financing, the development would not be subject to the inclusionary policy. DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188 Study session minutes -4- July 26, 2021 Councilmember Harris asked how soon the council needs to determine which zoning to pursue . Mr. Walther stated the council should provide initial direction tonight, adding R4 multiple family residence district or R3 two family district align with the medium density land use designation. Councilmember Kraft asked if the council has any influence over rental versus ownership opportunities. Mr. Walther stated no, not relative to zoning. It was the consensus of the council to pursue this process to change the land use from commercial to medium density residential and rezone the parcel from C1 neighborhood commercial to R4 multiple family residence. 3. Future study session agenda planning and prioritization Mr. Harmening stated currently there is nothing on the August 9, 2021 agenda. He noted, however, one item proposed by Councilmembers Dumalag and Mohamed, would be language updates in the TIF policy. Councilmember Dumalag noted they would like to propose racial equity requirements for developers requesting TIF. Councilmember Mohamed added the idea behind this it to ask developers to show how they are equitable. Councilmember Rog agreed. Councilmember Kraft agreed as well, and noted the process proposed as a joint study session with HRC. Councilmember Dumalag stated the HRC noted that council does not use them enough, so they thought this might be a good opportunity to involve them in this process. Councilmember Kraft asked why the council doesn’t just ask HRC to investigate this and report back to the council. Mayor Spano stated while this topic has merit, he is not sure where this topic would be headed as it related to TIF. He added until he is clear on this, he would not want to have a joint session with HRC. He would prefer to have a deeper discussion with council first. Additionally, he is concerned about limiting this discussion to contractors and employers . Councilmember Rog state she is supportive of asking the HRC and Planning Commission for recommendations. She added she would also like to discuss, assuming the city will still provide TIF, what should be required. Councilmember Mohamed stated she would like an initial meeting with the council to set the tone first, and then meet with HRC. DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188 Study session minutes -5- July 26, 2021 Mr. Harmening noted staff plans to bring the TIF policy to council for a full overview, adding these two discussions could be done separately and then brought together. Councilmember Harris stated she is in favor of this conversation at a future study session also, noting she would like to have the study session on the same night as the council meeting. Communications/meeting check-in (verbal) Mr. Harmening noted emails he has received from some restaurant owners in St. Louis Park inquiring about the city’s willingness to extend the time limit on having outdoor tents. He stated the deadline is July 31, so the tents then need to be removed . He noted one request is to extent tents to October 1, and if the council would like to discuss at the next meeting, they could set up a resolution for this. Mr. Walther added some other cities have restaurants that are going to continue outdoor tent seating through December 31. He added beginning January 1, 2022, the Met Council will charge restaurants additional SAC charges for the additional seating. Councilmember Harris stated there are two businesses in Ward 3 that utilize tents and are eager to operate with the tents. She would like to have a discussion with council prior to putting it on an agenda. Mayor Spano stated in Minneapolis they are extending tents indefinitely. He stated he would like to see the city remain as flexible as possible, adding he is still supportive of short -term extensions for tents. Councilmember Harris stated she knows of people that prefer to eat outside, even if vaccinated, because COVID cases are increasing slightly. She proposed the council extend the tents to October 1. Councilmember Mohamed stated she prefers some practices that came out of COVID, including being as flexible as possible. She would like to extend the deadlines and also would like a council discussion about this to make it beneficial for all. Councilmember Dumalag stated she got an email from a business in Ward 2 as patrons do not feel safe dining inside. She also noted some residents have complained about parking in the neighborhood. However, she is interested in doing an extension, while enforcing capacity limits and numbers of diners. Mr. Harmening stated there are some limitations on what the city can do with enforcing capacity limits, at this time, through this mechanism. Mr. Walther added also there have not been complaints about issues at the sites using tents either. Councilmember Kraft stated he is supportive of extending this for 2 more months. He added while he is sensitive to anything that comes up, he does want to support businesses. DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188 Study session minutes -6- July 26, 2021 Councilmember Rog stated she is also supportive of this. She asked if there are any lessons that have come out of this issue. Mayor Spano added he is interested in doing an extension right now, but would not want this to be ongoing, and to set expectations for the future. Councilmember Rog suggested November 1 versus October 1 as an extension date. Councilmember Harris prefers October 1 and being equitable and being fluid. She stated if the city goes into November, then there might be an ask for December 1. Councilmember Kraft stated he does not have a preference on dates . Mr. Walther suggested adding this to the consent agenda with the date of October 1 for the extension. It was the consensus of the council to put this on the next agenda, and to support an extension to October 1. Written Reports Councilmember Rog referenced the TIF request for the Beltline Residences, noting she reviewed the design guidelines for the area and several residents have concerns about the Opus development design. She stated some of the guidelines have not been met on this project design, including the areas of building corners at major intersections to create entryways. She also noted streetscapes as an area of concern. Additionally, the setbacks, landscaping are not noteworthy in the design either. She asked how far along is the design on this project and if there is any recourse here as it relates to the design guidelines . Mr. Walther stated the council has approved the PUD and TIF is being requested now. He noted the design guidelines are guidelines only and not requirements . Councilmember Rog stated going forward she would like to see the design guidelines be a more important part of the approval process on projects. Mayor Spano added going forward the council may need to look at the guidelines and point out which are not negotiable for the design of a project. Councilmember Kraft noted on the sustainability division update for Q3 he is looking forward to seeing a greenhouse gas inventory completed in September or October to give a sense of where we are in city plans. He stated with the climate issues this summer, we are now in a climate emergency, and it should be declared by the city, while also trying to work with other cities around Hennepin County. Mayor Spano stated he would like to discuss this but would not be interested in using “climate emergency” as a marketing tool. DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188 Study session minutes -7- July 26, 2021 Councilmember Kraft stated it can be effective as a call to action for a community and he will pull some materials together for review. Councilmember Harris noted there is a national night out event this week. Councilmember Mohamed stated she would like to visit more neighborhoods this year, meet more people, and wants to attend with others. Mr. Harmening thanked the council for their support over the years and stated the hardest part is leaving the people. He stated the new city manager will be great and asked the council to be patient with her. He noted this is the first time in 28 years a city manager is coming from outside the organization, and things will be different. He reminded the council that staff will also be adjusting to the changes. Mayor Spano noted the Sun Sailor newspaper did not accept the council’s Op Ed article for publication, citing it goes against their rules for publishing. Councilmember Mohamed asked if the annual retreat will be after the elections. Mr. Harmening stated yes. The meeting adjourned at 8:25 p.m. Written Reports provided and documented for recording purposes only: 4 June 2021 monthly financial report 5. Second quarter investment report (April – June 2021) 6. Application for tax increment financing assistance – Beltline Residences 7. Proposed interfund loan – Bridgewater Bank TIF note 8. Building readiness ordinances 9. Sustainability division update for Q3 2021 10. Metropolitan council livable communities demonstration account grant applications ______________________________________ ______________________________________ Melissa Kennedy, city clerk Jake Spano, mayor DocuSign Envelope ID: 402C7C30-087D-4676-8909-28A20A44B188