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2023-10-24 CC Meeting MinutesMOUND CITY COUNCIL MINUTES October 24, 2023 The City Council of the City of Mound, Hennepin County, Minnesota, met in regular session on Tuesday, October 24, 2023 at 7:00 p.m, in the Council Chambers in the Centennial Building. Members present: Mayor Jason Holt, Council Members, Sherrie Pugh, Paula Larson, Kathy McEnaney and Kevin Castellano. Members absent: None Others present: City Manager Eric Hoversten, Deputy City Manager Maggie Reisdorf, Finance Director Noah Iverson, City Attorney Scott Landman, Assistant City Engineer Matt Bauman, City Clerk Kevin Kelly, Ehlers Consultant Stacy Kvilvang, Ehlers Consultant Kyle Sawyer, Julie Weisenhorn, Karl Weisenhorn, Colin Charlson, Tiffany Beitler, Jen Houghton, Ben Colianni, Bruce Pudwill, Matt Raske, Five Technology, and Ben Moonen, Five Technology. Consent agenda: All items listed under the Consent Agenda are considered to be routine in nature by the Council. There will be no separate discussion on these items unless a Councilmember or citizen so requests, in which event it will be removed from the Consent Agenda and considered in normal sequence. 1. Open meeting Mayor Holt called the meeting to order at 7:00 p.m. 2. Pledae of Alleqiance 3. Approve agenda Hoversten said he has amendments to the agenda with replacement pages 2263 for the October 10th City Council meeting minutes and the addition of pages 2370.1 and 2370.2 to the finance supplemental memo. MOTION by Larson, seconded by Pugh, to approve the amended agenda. All voted in favor. Motion carried. 4. Consent agenda MOTION by Larson, seconded by Pugh, to approve the consent agenda. Upon roll call vote, all voted in favor. Motion carried. A. Approve payment of claims in the amount of $426,669.96. B. Approve minutes: 10-10-23 Regular Meeting C. RESOLUTION NO. 23-92: APPROVING AGREEMENT TO CONVEY EASEMENT (LAKEWINDS LIFTSTATION IMPROVEMENT PROJECT PW 23-03) D. Approve Pay Request in the amount of: 1. $7,107.90 to Valley Paving Inc. for miscellaneous Pavement Repairs 2. $57,285.00 to Thul Specialty Contracting for 2023 Manhole Rehab PW 23-04 3. $40,429.15 to Boulder Creations for 2023 Waterbury Retaining Wall Repair Mound City Council Minutes — October 24, 2023 4. $10,843.16 to Allied Blacktop Co, for 2023 Seal Coat Project PW 23-07 (Final)_ 5. Comments and suqqestions from citizens present on any item not on the agenda. None were offered. 6. Student Senate Westonka Schools Activities Update Samantha Krahl, gave the Westonka District Report. Krahl said she is a Senior at the High School and Secretary of the Student Council. Krahl addressed the Council with the following: Activities — • October 16: Activities Fair at MWHS • There are many clubs and activities for students to choose from Homecoming: Dances, Pep Fest and On -campus Parade among other activities Prom planning has begun for the May 4th, 2024 event DECA event Back to Business Challenge on October 29-30 • Robotics and Rotary has started • 9/11 Tribute remembrance • Veterans Day Posters and highlight veterans from the local community • Link Crew added 98 leaders this year: helps new students get adjusted to new school Athletics - • Fall Sports have finished seasons with some teams moving on to section competition Arts — • Theatre in Westonka: shows in October and November • Band mattress sale and Pep Band at events • Choir auditioned new members Academics - • Two national merit finalists • 41 AP Scholar Awards • College Board National Recognition • Westonka students were in the Top 10 on 2023 MCA and MTA district level tests Westonka Updates — • Westonka School District Election and levy questions on November 7th • Teacher of the Year nominations close on October 27' 7. Consulting Water Resources Engineer Bob Bean (Bolton & Menk) hosting 2023 MS4 Permit Public Meeting Matt Bauman, Assistant City Engineer, said the purpose of the Municipal Separate Storm Sewer System (MS4) Permit meeting is to inform the public on Storm Water discharge and actions taken to reduce the discharge of pollution. Bauman added the MS4 public hearing is held to receive public input on the City's Stormwater Pollution Prevention Program (SWPPP). Bauman said the MS4 Permit must by obtained by a City in an "urbanized area" which the City of Mound meets. Bauman added the City is currently implementing the Best Management Practices (BMP) outlined in the MS4 permit. Bauman provided a status update on projects undertaken in 2022/2023 and future projects. Bauman said as part of the MS4 permit the Minnesota Pollution Control Agency (MPCA) requires Mound to have a SWPPP as the MPCA considers the City as an urbanized area. Bauman said the Mound City Council Minutes — October 24, 2023 SWPP is comprised of regulatory programs, education, inspection and maintenance, and documentation. Bauman listed the following: Six Control measures • Public education and outreach — Quarterly newsletters and community festivals • Public participation/Involvement - annual meeting comments solicited from public, Minnetrista compost dump • Illicit discharge detection — prohibit non-stormwater discharges and enforcement • Construction Site Runoff Control — erosion and sediment control at construction sites with Minnehaha Creek Watershed District • Post -Construction Stormwater Management • Pollution prevention good housekeeping for municipal operations Other areas of the MS4 Permit which are addressed: • Street sweeping and inspection of storm drainage system— This is ongoing pollution prevention/good housekeeping on Best Management Practices • Storm drainage system assessment improvements and maintenance of City treatment improvements as part of street project construction. • Maintain manual inspection of all storm sewers • 141 outflows in 18 sub -watersheds to 14 different lakes and bays • Performed improvements to 40 sumps, nine hydrodynamic separators, two pervious pavement lots, two water quality vaults, three bioretention basins, cleaned two dry retention basins and ten drainage swales/ravines 2022 MS4 Highlights: • MPCA Audit of MS4 program in 2022 is a review of compliance and to keep track of City documentation • Inspected Village of Island Park residential development • Participated in metro Watershed partners consortium • Harrison Bay study of stormwater runoff characteristics • Overland Road rain garden • 2022 cost share at Harrison Bay Rain Barrel Event Plans for 2023: • Continued Inspection and maintenance of stormwater infrastructure • Continue to improve and refine documentation • Assess/construct stormwater improvements • 2023 Harrison Bay Rain Barrel Event participation • Pond assessment plan • Improve efficiencies • Inspect all ponds and outfalls Mayor Holt opened the public hearing at 7:30 pm for public comment. Bart Halling, 5513 Sherwood Drive, said he is a Director of the Harrison's Bay Association (HBA) and that the HBA has compiled stats on Harrison's Bay with a focus on water quality. Halling listed: • Six Bays on Lake Minnetonka are rated as impaired are in the Mound area • Phosphorus and algae are a problem Mound City Council Minutes — October 24, 2023 • Phosphorus runoff from Painters Creek is 60% of the total coming into the Bay • Chloride runoff from road salt stays in the water indefinitely Minimum Control Measures (MCM) • MCM1 - HBA public education and outreach through education materials • MCM2 - HBA public participation with rain barrel program and rain garden projects • Planting event for Apple Lane Rain Garden in 2024 • Website content Future endeavors of the HBA • Green Roofs — planting vegetation on roofs • Prioritizing Projects — partnering with City to create water quality benefits • Cardinal Lane — HBA would like to pursue a solution to change how the Right of Way is structured. • HBA said 850 solid sediments running off of Cardinal Lane Halling asked the Council to consider remediation of the Cardinal ROW in 2024. Halling said the HBA received an estimate from Concept Landscaping for $7500.00 for rip rap at the shoreline adjacent to the Cardinal Lane ROW. Halling said he would like the Council to accept proposal for a rain garden buffer at Cardinal Lane. Castellano asked about the cost of the rain garden at Cardinal. Julie Weisenhorn, of the HBA, said it would be around $25K. Mayor Holt closed the public hearing at 7:40. 8. Hart Foundation Donation Agreement review Hoversten said in June of 2022 a small group of residents asked if a project could be done to respond to the human tragedy which happened in the City in May of 2022. Hoversten said the Eli Hart Foundation (EHF) wants to replace aging equipment at Surfside Park in response to the tragedy. Hoversten said the City brought forward a resolution of support of the EHF and to work with City Attorney on a donation agreement. Hoversten said the EHF has raised enough funds to be a 95% solution to the funding for the project. Hoversten said this was done through fund drives and engagement campaigns. Hoversten said there is a funding gap which the City could fund to provide the remaining portion of the gap. Hoversten said the activities outside of the scope of the playground must include stormwater offsets. Hoversten said the offsets are due to the playground hardcover. Hoversten said there also must be site grading and other site work to the terrain so water drains away from the playground to the area west of the depot. Hoversten said these are costs which aren't met by the EHF fundraising. Members of the EHF were joined by staff at Midwest Playscapes to discuss the playground design proposal. Tiffany Beitler of EHF said there were minimal changes from February. Beitler said the only changes made were to add shade elements at the request of the family of Eli Hart. Beitler said the plan was down sized to tighten up the space and make it more in the shape of a rectangle. Beitler said the EHF raised $280-290K with an additional grant of $47K from Hennepin County for youth sports programs. Beitler said the goal for the playground was $340K and the original design was scaled back, poured in place playground surface reduced with more space filled with wood chips. Mound City Council Minutes — October 24, 2023 Midwest Playscapes staff addressed the Council to answer questions or concerns. Bruce Pudwill said he is the President of Midwest Playscapes, based in Savage, Minnesota and is proud to be part of this endeavor. Pudwill said he realized there are other things in life that are more important than business. Pudwill said the playground will meet the current safety standards for playground safety. Madison Mitchell, Midwest Playscapes, said she put together the site plan and drawings of the playground plan. Mitchell said the site plan presentation showed where the poured in place locations were sited. Mitchell presented elements of the playground design: • Cozy Cocoon — Spinning motion and interior tactile environment designed for kids on the Autism Spectrum is on the poured in place surface • Playhouse with an interactive play environment for younger kids • Unity Spinner which is pitched inward for kids with poor trunk strength • Concerto music equipment • Transfer station — allows kids who use a mobility device to access the play structure All Slides in the design have ADA accessible stairs • Play Cube — for older age groups use which are more of a challenge to use • Nika — two sized climbing apparatus with one small and assisted access with low transfer height • Timber Stack — Advanced climbing with ropes • Rope Play Apparatus — designed with rope to catch kids at a lower level if they fall • Second Slide with ADA stairs Mitchell said the playground is functionally linked for the play structure sections to act as one safety zone. Mitchell said the Swing Apparatus has a swing -along seat for adult and child, a toddler seat, an ADA seat and two standard swing seats. Mitchell said there is 217 children maximum who could use the playground at one time. Larson said the proposed playground is twice the size of the current playground. Larson said currently there is a major issue with the use of the parking lot and this will impact the use of the park by families. Larson asked, didn't the City have a study done in 2018 or 2019? Hoversten said the City produced the Surfside Improvements Master Plan and identified replacement of the playground and the playground plan was for this playground to increase in size. McEnaney praised the group for their fundraising. McEnaney said her issue is the same as in March as she feels the footprint is too big. McEnaney said the plan is beautiful and would like to see it reduced in size. Castellano said he is neutral as far as size and asked about the gap in funding after donations. Castellano said he is not opposed to the size and wondered about moving play structures. Jen Houghton of the EHF said they tried to move things around but everything has its purpose. Ben Colianni of the EHF said if you remove a piece, you remove the funding for the structure as they each are sponsored. Beitler said they have added sponsored benches and feel they are not taking away any green space. Discussion ensued about the EHF playground size and previously discussed concerns about the plan. Further discussion was about the footprint being reduced in size and the design using an underutilized space at the park and how the swing feature was the number one requested element. Mound City Council Minutes — October 24. 2023 Pugh said parking should not be an issue for the playground. Pugh said Mound is a walkable City and people do walk to the park during events at Surfside. Pugh said this is an unprecedented opportunity to leverage raised money by residents and help the City do something which the City already wanted to do. Pugh said this would be the only City park that will be ADA accessible. Pugh said Surfside Park has always had sizing issues and the Park users said they can adjust to the playground. McEnaney said there no question it is beautiful and taking away this much green space is not good. Colianni said the EHF went off of a previous design proposal. Hoversten said there were issues between the tradeoff between playground and green space. Hoversten said the green space near the parking lot is currently unusable space due to drainage and other issues. Hoversten said the Surfside Park is at its busiest during events. Hoversten said there isn't an issue with the size of the playground according to event committees who use Surfside Park during the year. Hoversten said it fits in the proposed area and is a terrific plan. Hoversten said this is a way to bring an ADA component into the play space and meets multi - generation objectives that are met by a larger area and larger safety zones for kids. Colianni said Midwest Playscapes are not charging extra and getting an estimated value of $605K for the playground and will result in Mound having the nicest playground on the lake. McEnaney said she would have liked to see the area staked out in the park. Houghton said she brought her kids to the park and there are events in the park and everybody has the space to hold events. Bruce Pudwill said that almost every mid -sized or small city is looking at inclusive playgrounds and he is working with other cities who are putting in playgrounds. Pudwill said those cities are looking to attract children with disabilities and their families to their playgrounds. Pudwill said parents with disabilities can inclusively use the parks with their children. Pudwill said there are well over 50 inclusive playgrounds now in Minnesota. Larson asked if the poured in place is concrete. Pudwill said it is a rubber cement and one of the most favorable surfaces for children and people with disabilities. Pudwill said the wood chips which will be placed, are engineered to be an accessible surface as well.. Larson said the plan is to have a sidewalk to get to the playground. Hoversten said the ADA parking will be in the parking lot next to the depot with sidewalk access. Hoversten said there is a $40K gap in stormwater costs to grade and allow water to flow to the west and away from the playground. Hoversten said the EHF fundraising has pretty much ended at this point. Hoversten said there are areas within City funds where the numbers could be found. Castellano thinks this is great and hopes the plan happens. Holt said he has met with the EHF in the last year and appreciates their time and energy devoted to the playground. Holt said the Council urged the EHF to go bigger in their design to make the playground more interesting. Holt said the City needs to figure out where to find the funds and work in partnership with the EHF. Holt said he is 100% in favor of the playground plan. Holt said the plan can cut a few things to reduce poured in place and address costs. Mound City Council Minutes — October 24, 2023 Pugh said it is our duty as a Council to look at taxation and also to look at the return on the funds being spent. Pugh said this playground is a new piece which the City doesn't have. Pugh said the City leveraging what residents have raised is a good thing. Hoversten said the sand from the beach and the geese that wander the area create the need for poured in place pavement. Hoversten said the poured in place also minimizes maintenance costs down the road. Hoversten said the Park Improvement Plan can be addressed to refine the final project in order to soften the edges of the design. Pudwill said the design can be worked on. Pudwill added there has to be safety use zones maintained and that the zones are placed tightly into the design. Pudwill said this is done in order to not take away a piece of equipment and reduces space and cost. Discussion ensued about a more rounded plan design being more aesthetically pleasing and the design of the playground structure and safety use zones. Mitchell said the Nika Climber is brand new and isn't in other playgrounds and was funded by local Rotary groups. Pudwill discussed the different elements of the design to keep kids interested in playing at the playground. Larson asked about the signage for the Eli Hart Memorial Playground logo. Beitler said EHF talked about putting the logo into the poured in place rather than on a sign. Colianni said the EHF agreed the logo be in the poured in place. Beitler said sponsors could have the signs of their organizations placed on the structure they funded. Hoversten said he needs a final playground site plan to hand off to the City Engineer to do site plan work and to get the playground built earlier in 2024. Hoversten said approval of the donation agreement by the end of the year will most likely be at the December 1211 final Council meeting. 9. Outlot B Discussion Landsman said the Outlot B property is a property adjacent to Council Member Larson's commercial property and she has been advised that there is a potential conflict of interest. Larson said she will recuse herself from this discussion. Hoversten said staff have been approached by a potential buyer interested in acquiring Outlot B. Hoversten said there is a commercial building on the property adjacent to Outlot B. Hoversten said the property has Old Shoreline Drive frontage and is owned by Colin Charlson. Hoversten said Charlson is here to seek advice and to see if the City is willing to move forward to dispose of the property. Hoversten said the City can hold on to the property for future development or release the property. Hoversten said Outlot B is too small on its own to develop but there is an opportunity to assembly Outlot B with an adjacent property. Hoversten said this could be through an open to the public sale or through an adjacent property owner preference sale. Hoversten said the adjacent sale is a broadly used land disposal technique for local governments. Pugh said the City agreed to sell the property to a former developer but the developer didn't want to pay the appraised value. Pugh said the City should stick with the appraised value. Holt said the City would get TIF money if the project on the corner of Old Shoreline and Commerce went through. Hoversten said if nothing happens on the property the City doesn't get the components of the collected tax. Hoversten said cities shouldn't be speculating in real estate but should only purchase land for development purposes. Hoversten said there isn't a commitment to a specific project by any of the Mound City Council Minutes — October 24, 2023 perspective buyers. Hoversten said the previous project had tax value benefit which would offset the lower than appraised value for the land. Hoversten added the TIF on Outlot B and surrounding area will end in 2031. Hoversten said the adjacent property owner, Colin Charlson, is investing in his current property by improving the current building on the property. Colin Charlson, 5749 Sunnybrook Lane, Minnetrista, said he is the adjacent property owner of Outlot B. Charlson said he bought the adjacent property to Outlot B as he was one of the partners of NHH, the development entity which held the purchase agreement for Outlot B. Charlson said NHH approached him to purchase the adjacent property which he did purchase. Charlson said he loves the building but is working through complicated engineering that includes ADA accessibility issues and other issues. Charlson said he is attempting to determine if it makes sense to keep the building as it is. Charlson said the building will be adding professional office space as professional office space is in demand in Mound. Charlson said one issues with the building is ADA access and a six-foot elevation drop from building to the west parking lot. Charlson said if he bought Outlot B he could build a sidewalk from the parking lot around the building and leave the rest of Outlot B as nice open space. Charlson said his property is right up against the two surrounding lots so setbacks are an issue. Charlson said he is looking for input from the Council on what they would like to see on Outlot B. Holt said he was excited about the NHH proposal and disappointed the agreement fell through. Holt said he thanked Charlson for his investment. Holt said the improvement of the building on his property would be a benefit to the community. Hoversten said a scrape and rebuild of the building could have a minimal tax capacity change. Holt said Charlson could come before the Council with his development plan for Outlot B. Hoversten said he would recommend to the Council an adjacent owner sale rather than general open public sale of Outlot B because Outlot B is unbuildable without it being combined with an adjacent property. Hoversten said if the Council would compare the value in waiting for a project the Council could figure out the tax value of the land. Hoversten said Charlson hasn't provided a plan for Outlot B other than the sidewalk around the building. Hoversten said the sale brings a subjective value to the City for a local owner to improve a building rather than increasing the tax base. Pugh said she understands Outlot B is not a buildable lot but the vacant lot is on a major intersection in the City. Pugh said she would like to know the intent of the adjacent owner and is concerned about an empty lot continuing. Charlson said Outlot B needs to be improved in some way. Hoversten asked the Council if the City is interested in disposing of the property. Castellano said he would not want the City to continue to own Outlot B but would like to see a plan of what Charlson's intent is for Outlot B. Discussion ensued about Outlot B being in a mixed -use zoning district. Hoversten said mixed use means many things and anything built on Outlot B needs to be approved through a Conditional Use Permit and through the Council. Charlson said he would also add a monument sign at the front of the building with the commercial tenant's signage on Outlot B. Mound City Council Minutes — October 24, 2023 Pugh said this is in a critical moment in the City regarding the Harbor District's use and appearance. Pugh said she is interested in seeing Charlson's plan. Charlson said he is updating the building on his property and will be adding the sidewalk if he purchases Outlot B. Discussion ensued regarding the steps Charlson needs to take to show plans to the Council and the plan's particulars. Hoversten said if the Council is interested in selling the land to Charlson he could bring the plans to the Council. Charlson said he could bring in plans at one of the November meetings. Recused Council member Larson addressed the Council. Paula Larson, owner of the 2316 Commerce Blvd. private property, said her son's development company is interested in purchasing Outlot B. Larson said she has hired an architect to make up plans for the property. Larson said she is a member of the Council though she would like an opportunity to bid on Outlot B. Landsman said there are restrictions to the buying or selling of City property by a sitting Council member. Landsman said there are factors which could change such as Larson selling the property or not having a financial gain from the property. Landsman said Larson should speak to her attorney about the law. Larson said if she would resign from the Council could she then be an adjacent property owner. Landsman said she wouldn't be held to Council property rules if she resigned. Larson said she has owned her property since 1997 and needs to make a major decision. Hoversten said Landsman can speak with Paula Larson's attorney about legal options. Hoversten said there could be options before the Council depending on the status of the adjacent property owners. Hoversten said there are only two adjacent property owners to Outlot B. MOTION by Castellano, seconded by Pugh to move agenda items 12 and 14 up in the agenda before items 11 and 13. All voted in favor. Motion carried. 10. City Engineer Brian Simmons requesting approval for Resolution Approving Feasibility Study for 2024 Lift Station Repair Project Matt Bauman, Assistant City Engineer, said this lift station is off of the corner of Sycamore and Sunset. Bauman said the lift station feasibility study will prepare the project for bids in early in 2024. Bauman said this lift station is number 26 out of 30 lift stations which needed to be rehabbed. Bauman said the original 15-year plan for lift station replacement has been extended. Hoversten said the present monitoring technology is not sustainable and the lift station is deteriorating. Hoversten added that the force main out of this area is also possibly beyond its useful life. MOTION by Castellano, seconded by Pugh, to approve the following resolution. All voted in favor. Motion carried. RESOLUTION NO. 23-93: RESOLUTION ORDERING PREPARATION OF REPORT ON LIFT STATION IMPROVEMENT PROJECT FOR 2024 11. City Manager Eric Hoversten; discussion of T-Mobile Evergreen Tower Lease and action to approve Resolution Approving Third Amendment to Water Structure Space Lease Agreement Hoversten said this is the Evergreen tower lease which is separate from the Chateau tower lease. Hoversten said the City is at 3% increases for the next three years and this is intended to be a long- term lease. Hoversten said the previous lease was based on a variable Consumer Price Index (CPI) incremental and the new lease is set at 3%. Hoversten said the CPI has performed at 2.65% over the Mound City Council Minutes — October 24, 2023 last few years. Hoversten said his recommendation is for the Council to approve the new lease amendment. MOTION by Larson, seconded by McEnaney, to approve the following resolution. All voted in favor. Motion carried. RESOLUTION NO. 23-94: RESOLUTION APPROVING THIRD AMENDMENT TO WATER STRUCTURE SPACE LEASE AGREEMENT 12. Server Upgrade Presentation; Approve Resolution Authorizing Purchase of Network Upgrade Services Outside of Budget Reisdorf said this network system upgrade has been reviewed at two previous Council meetings. Reisdorf said the Council has requested Five Technology to provide support at a Council meeting for their proposal. Reisdorf said the project was put out to bid and Five Technology offered a $24K bid. Reisdorf said the other company decided to not bid on the project. Reisdorf said this is not a budgeted expense for 2023. Reisdorf said it is a capital expense that would come from the Capital 403 reserve fund for equipment purchases. Reisdorf added that the 403 Fund balance is at $502K. Reisdorf said staff recommend the passing of the resolution and awarding the bid to Five Technology. Matt Raske and Ben Moonen, Five Technology, said the City has a lot going on with multiple buildings and security and backup help. Moonen said the network hardware replacement is out of warranty and it is time for an upgrade. Moonen said the upgrade would: • Replace Windows server • Replace Backup Hardware • Replace Network Switches Moonen said he would like to thank the Council for the opportunity to work for the City and Five Technology appreciates the City's business. McEnaney said why Five Technology waited so long to upgrade the technology when Microsoft had given warning three years ago. Moonen said this was an oversight on their part. Moonen added the technology is still working and the server can be switched out with replacement technology fairly quickly. Moonen said Five Technology can provide more regular Council appearances and reports going forward. Moonen said Five Technology has worked for the City for many years. McEnaney said why did it take so long to change out the system. Moonen said as a technologist they could turn over the server change fairly quickly. McEnaney said she appreciates the presentation. MOTION by Castellano, seconded by McEnaney, to approve the following resolution. All voted in favor Motion carried. RESOLUTION NO. 23-95: RESOLUTION AUTHORIZING PURCHASE OF NETWORK UPGRADE SERVICES OUTSIDE OF BUDGET 13. Cemetery Section D discussion City Clerk Kevin Kelly, presented the expansion plan for the last section of the Mound Union Cemetery which has not been used. Kelly said all of the available grave lots in the cemetery have been sold but one which was recently sold back to the City. lift Mound City Council Minutes — October 24, 2023 Kelly stated the Council created a sub -committee which looked into different options for the cemetery including an Ossiarium or Mausoleum which were estimated to cost $150K to build and would be expensive to maintain. Kelly added the Council determined at an August 2022 meeting to go forward with in -ground burials. Kelly said he has received a cost estimate from City Engineer vendor Bolton and Menk. Kelly said the estimate is $4K to set boundary and grave lot pins which would be a one-time cost to the General Fund. Kelly said the current fees for grave purchases are $600.00 for residents and $1100.00 for non- residents. Kelly said he looked into what other cemeteries in the area and metro cost. Kelly said he found most of the grave lots for sale are going for $1 K to $1500.00. Kelly said a grave can have two interments; one casket with an urn or two urn interments. Kelly said staff looked into the types of burials being conducted in the cemetery. Kelly said there were 80% ash burials and that trend has continued in 2023. Kelly said there have been two casket burials in each of the last three years. Kelly said there has been preparation work by Bolton and Menk to set the GIS grid and do survey work and those costs have been approximately $11 K. Kelly said he has created a wait list of nineteen people who are interested in purchasing a grave and a majority of the nineteen are Mound residents. Kelly said he is proposing to increase fees to $700.00 for residents and $1400 for non-residents. Kelly said non-residents should pay the going rate for graves in the metro area as the preparation of the cemetery have been paid through City funds. Kelly said there hasn't been a limit to the number of graves an individual can purchase and there are quite a number of unused grave lots; especially in the oldest section of the cemetery. Kelly said he would like to propose to limit the number of graves purchased by an individual to three graves for residents and two graves total for non-residents. Kelly said the funds generated by grave sales in 2024 can provide the funds to cover the cost of a Cemetery Entrance Monument and other amenities. Larson said the City can look into fencing and Hoversten said the City can add plants to buffer the Public Works storage area. MOTION by Pugh, seconded by McEnaney, to move forward with paying Bolton and Menk for marking the gravesite and to sell cemetery plots. All voted in favor. Motion carried. 14. Stacie Kvilvang from Ehlers providing discussion on Future Water and Stormwater rate structure for Financial Master Plan Stacie Kvilvang presented a rate structure of the City utility funds which are the enterprise funds designed to make money to pay for City utility infrastructure needs. Kvilvang said the utility funds are not performing well, especially the water and stormwater funds which are being supported by the tax levy. Kvilvang gave the Council options to consider but she said Ehlers is sensitive to 2024 budget decisions. Kvilvang said these options are geared for implementation in 2025. III Mound City Council Minutes — October 24, 2023 Kvilvang gave an overview of the City rate increases starting with 2018 when the City Council made the decision to not increase utility rates. • Water Fund did not experience an increase until 2023 • Sewer Fund is supported by a $360K annual tax levy. A self-sustaining Fund through utility rates would lessen the tax levy • Stormwater rates were decreased in 2018 by 90% and haven't experienced an increase since 2018 • Recycling went up 31 % in 2022 due to a new contract being signed Castellano asked if the levy would be reduced by 4.5% if the Sewer Fund was funded through rates only. Hoversten said essentially yes. Kvilvang gave a report on the current status of the Water Fund which is $3.7Million in debt and if rates remain unchanged that this debt will continue to increase. Kvilvang added the Stormwater Fund is not being funded properly and is also in debt. Kvilvang said the Sewer fund is doing pretty good right now due in part to the tax levy support it receives. Kvilvang said if the City doesn't change rates this fund will also go in the hole. Kvilvang provided a Utility fund analysis which is a high-level review. Kvilvang said the goal is to get the Stormwater and Sewer Funds off of the tax levy and make the Water Fund to be functioning as an enterprise fund. Kvilvang listed Key Assumptions of their analysis: • Expenses will increase — 4% annually • Capital Costs inflated — 4% annually • Metropolitan Council Environmental Services charges — 7% annual increase • Consumption not analyzed • 2022 Revenue was used as a projection. However, 2022 was a dry year and there is ebb and flow in the system Utilities are Capital Intensive — 2027-2033 Capital Costs are inflated at 4% annually Water Capital Cost - $11 Million in future projects Sewer - is about $7.3Million in future projects Storm Water - $685,000.00 in future projects Rate Structure components — Water and Sewer • Rates are based on volume charges per 1,000 gallons with rate increases at high consumption tiers • Residents pay a Sewer minimum charge regardless of use • Water Base Fee — a fixed fee should pay for the operation of the City utility regardless if you use the water due to keeping the system operating Water Utility Rates - • Current quarterly base fee is $58.42 a quarter • Tiers start at 5 thousand gallons up to and over 25 thousand gallons • Ehlers recommends rate increases across the board so every tier would go up • Look to 2025 to increase fund 15% and then over time moderate the rate increases as the balance improves Kvilvang said the Water utility is currently in $3.7Million of debt which will increase to $3.9Milllion if nothing changes M Mound City Council Minutes — October 24, 2023 Kvilvang said the City could establish new fixed charges to allow the fund to "get well" to pay down the debt over five, seven or nine years. Sewer Fund - Kvilvang recommend rate increases at a slower pace than the Water fund because the Sewer Fund is in a better financial position. Kvilvang said the goal is to get the Sewer Fund off of the tax levy, to maintain a healthy sewer fund and eliminate the debt levy by 2031. Kvilvang added a caveat; which was adding irrigation meters will decrease sewer revenue. Stormwater — Kvilvang said her recommendation was to increase one of the lowest stormwater fees in the metro area. Kvilvang said to increase the $1.50 rate to $3.00 and then to $6.12 in 2027 and then reduce after 2027. Kvilvang said this fund could be in the positive cash flow within five years. Kvilvang said the Recycling fund is healthy and doing well and no change is needed. Kvilvang created a chart which demonstrated the water bill impact to the average City user. Medium water user bill using 18K gallons of water is listed below: 2023 - $159.56 2024 — $164.35 2025 — $207.00 Kvilvang listed the impact to the total utility bill of the average user of 18,000 gallons of water: • Under the five-year plan the 2025 bill would increase $62.45 a quarter • Under the seven-year plan the 2025 bill would increase $53.45 a quarter • Under the nine-year plan the 2025 bill would increase $48.95 a quarter Kvilvang said the bill impact on the Commercial storm water user significantly increases in 2025. Kvilvang said all City of Mound Utility rates taken together are at about average in regards to neighboring cities. Kvilvang said the Council needs to determine whether to use a flat fee to get to positive cash flow in the Water Fund or to use tiers which promote conservation. Kvilvang said the Council will need to decide on the time frame to get to positive fund balances. Kvilvang said this would be in 5, 7 or 9 years. Holt said the five-year plan would not be popular. Holt said the Council can appease people as in 2018 when the Council cut rates but it put the water fund in the hole. Holt said the five-year plan is too short but the Council has to do something. Pugh said other cities were increasing franchise fees and Mound wasn't looking at raising money from other sources. Pugh said these new resources will allow the City to catch up. Castellano said the Council should make a list of things we want from the budget. Castellano said we can't do nothing. Holt said the City needs to communicate the debt situation in order for residents to see the City has a plan to provide bond funders. Hoversten said there needs to be actual revenue raising and the urgency is to start to pay down debt so the City credit rating stays positive for bond borrowing. Castellano said dropping the Sewer Fund off of the levy in five years is huge. Hoversten said after 2031 the Sewer Fund will provide capital relief. 13 Mound City Council Minutes — October 24, 2023 Hoversten said fixing the base fee structure versus usage rates doesn't hurt as much to the 65% of users who are on more of a fixed income. Hoversten the rates could be set in which opulent use produces more expensive fees. Hoversten said there will be process costs when water is treated with the new water treatment plant. Hoversten said there will be greater operating costs when the new treatment plant comes on line. Castellano said he wants to compare the five, seven and nine-year rates and how the rate structure effects rates based on greater usage. Holt said the rate study can help create a tiered rate and the higher user pays extra fees based on their usage. Castellano said as a resident I like the rate study. Castellano asked how could pay for a rate study to which Hoversten said from an enterprise fund. Hoversten said the rate study needs to be done by specialists who are consultants and not in-house staff. Hoversten said how does the Council respond to flat rate or user rates. McEnaney said she would like to go with tier rates. Holt said he is for tiered rates. Castellano said he is for tiered rates and the City has time to wait for a rate study. Hoversten said tiered rates puts the revenue rate burden on the highest users of water by the gallon. Larson said the City is not locked in if the fees are too severe. Discussion ensued regarding changing the fee schedule by the City on an on -going basis. Noah Iverson said Ehlers has the expertise and data analysis perspective which the City doesn't have. Larson said she wants to do a seven-year rate catch up. McEnaney said she would like to go to the middle ground and the seven-year plan and a tiered rate structure. Sawyer said tier one would get larger and usage rates would go down and second and third tiers would then pay more due to their usage. Sawyer said he would chart out the breaks for tiers and how many users are in each count and what this does this to revenues and promoting conservation. Sawyer said he has done other utility rate studies and would most likely be the Ehlers staff completing the rate study if it is determined to do so. Hoversten said the Council needs to decide whether it wants to do the rate study. Sawyer said he could analyze the Storm and Sewer Funds after receiving the data to make a variety of changes to make rates reliable and equitable. Sawyer said the cost could be a not to exceed amount of $30K to perform that rate study. Castellano said it is a small price to pay to get these funds healthy. Holt said would all utility users pay more. Sawyer said every resident would be affected. Castellano said he would need a little time but would like to make a decision in November on the rate study. Holt said he would like the Council to come up with a decision and have Ehlers providing the Council a bid at the November 14t" meeting. Holt said he is in favor of a seven or nine-year plan. Pugh said she is in favor of the seven-year rate plan. Castellano said he is in favor of a five-year plan, with seven as his next choice and finally nine being last. 15. Comments/Reports from Council Members: 14 Mound City Council Minutes — October 24, 2023 Council Member Pugh — Suburban Rate Authority meeting raised an issue regarding solar charging stations for electric vehicles. Pugh said the City parking garage could also include public solar vehicle charging. Pugh added that a commercial property owner might also be interested and the City should start looking to zoning for this activity. Hoversten said there isn't commercial solar charging in place in the zoning code and the Planning Commission can put together zoning guidance and an application process in 2024. Holt said if the City did put in charging at the parking garage could the City make money off of it. Hoversten said the City could partner with a concessionaire or the City could set it up and operate it which would be non -revenue generating. Hoversten said electric vehicle owners are informed and are market savvy. Landsman said he uses an EV and chargepoint is the most common vendor. Pugh added she attended the Statewide Conference on Aging. Council Member Larson — Nothing Council Member McEnaney — There is a need for applicants for the Planning Commission position. Council Member Castellano — Nothing Mayor Holt — Holt met with Tim Nichols of Artessa and the Artessa project has finished the basement and parking garage. Holt said by the end of January the building will be framed with move in at the end of August. Holt said there were 34 applicants for the City Manager position and the search consultant narrowed down the candidates to 10. Holt said the Council should watch candidate videos and be ready for making choices on Monday at 6:30. Hoversten asked for the Council members to be ready for their top five candidates. Holt said he and Hoversten are invited met with State Senator Kelly Morrison meeting regarding funding for the water treatment plant. Other items Holt mentioned: • Communication Meeting with Reisdorf was very constructive with good feedback. • City Social media policy on the agenda for the next Council meeting. • He had an interview with Homes.com to promote Mound • Lake Minnetonka Cable Commission video production will end 16. Information/Miscellaneous A. Comments/reports from Council members/City Manager: • October 30 - City Hall winter hours begin • November 18 - Tree Lighting Event • November 10, 23, 24 - City Hall closed for Veteran's Day and Thanksgiving B. Reports: Fire Department — September 2023 Finance — September 2023 Engineering — Third Quarter C. Minutes: September 5, 2023 — Planning Commission D. Correspondence: 17. Adjourn MOTION by Larson, seconded by McEnaney, to adjourn at 12:00 a.m. All voted in favor. Motion carried. Attest.'Kevin Kelly, Cler 15 Mayor Jason R. Holt