2012-02-14 CC Meeting MinutesMOUND CITY COUNCIL MINUTES
February 14, 2012
The City Council of the City of Mound, Hennepin County, Minnesota, met in regular session on
Tuesday, February 14, 2012, at 7:00 p.m. in the council chambers of city hall.
Members present: Mayor Mark Hanus; Councilmembers Kelli Gillispie, Ray Salazar, Heidi
Gesch and David Osmek.
Others present: City Attorney John Dean, City Manager Kandis Hanson, City Clerk Bonnie
Ritter, Community Development Director Sarah Smith, Finance Director Catherine Pausche,
Blaze Fugina, Debbie Hagberg, William Moore, Tim Hartman, Rick Hagberg, Steve Bona
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 Hanus called the meeting to order at 7:00 p.m.
2. Piedae of Alleaiance
3. Approve agenda
Hanus requested the addition of Item 4F, WeCAN request for support for CBDG grant.
MOTION by Osmek, seconded by Salazar to approve the agenda as amended. All voted in
favor. Motion carried.
4. Consent agenda
MOTION by Osmek, seconded by Salazar to approve the consent agenda. Upon roll call vote,
all voted in favor. Motion carried.
A. Approve payment of claims in the amount of $636,996.15.
B. Approve Pay Request No. 7 from GMH Asphalt corp. in the amount of $84,498.64 for the
2011 Street, Utility and Retaining Wall Improvement Project (PW -11 -01 and 11 -02)
C. RESOLUTION NO. 12 -21: RESOLUTION AWARDING CONTRACT FOR THE ISLAND
VIEW DRIVE TO WINDSOR ROAD WATERMAIN LOOP PROJECT
D. RESOLUTION NO. 12 -22: RESOLUTION APPROVING PUBLIC LANDS PERMIT FOR
TREE REMOVAL AND TRIMMING AT 2851 CAMBRIDGE LANE
E. Requests from Interim Police Chief Dean Mooney
(1) Approve Professional Services Agreement with Sojourner Project
(2) Approve Professional Services Agreement with CornerHouse
F. RESOLUTION NO. 12 -23: RESOLUTION RECOMMENDING CONTINUATION OF CBDG
FUNDING OF WESTONKA COMMUNITY ACTION NETWORK (WeCAN)
Mound City Council Minutes —February 14, 2012
5. Comments and suggestions from citizens present on any item not on the agenda.
None were offered.
6. Review /discussion /action on resolution denying variance for 3070 Highland Blvd. (PC
Case 11 -13) — item tabled at January 24. 2012 meeting
Sarah Smith reviewed that at the December 13`h meeting, Council directed Staff to prepare a
resolution of denial to be brought back for consideration. A draft resolution was presented
based on the directive, and additional information has been provided by the applicant who has
requested further consideration by the Council. The applicant, William Moore, also spoke to the
Council in defense of his proposed variance.
Hanus stated that he is trying to protect the code and the standards that have been set, and that
he feels that in a legal sense granting this variance would not set precedent, but in a practical
sense it would. Osmek and Gesch expressed concern over the designation change that would
occur from accessory structure to primary structure, by connecting the house to the garage with
a breezeway. Salazar and Gillispie indicated that they believe this to be a reasonable request
due to it not affecting neighbors and meeting other criteria of granting a variance.
MOTION by Osmek, seconded by Gillispie to adopt the resolution for approval that is included in
the packet, with the addition of two conditions: (12) Front load garage entry and driveway must
be removed; and (13) The structure that is now the garage cannot be used as living space. The
following voted in favor: Gillispie and Salazar. The following voted against: Hanus, Gesch and
Osmek. Motion failed.
MOTION by Osmek, seconded by Gesch to adopt the following resolution as amended with
date clarifications. The following voted in favor: Hanus, Gesch, and Osmek. The following
voted against: Gillispie and Salazar. Motion carried.
RESOLUTION NO. 12 -24: RESOLUTION TO DENY VARIANCE REQUEST FOR PROPERTY
AT 3070 HIGHLAND BOULEVARD. P &Z Case #11 -13, PID #23- 117 -24 -43 -0001.
7. Review /discussion with Jeff Schoenwetter of JMS Custom Homes and Tim Hartman
regarding request for use of Chapter 429 financing for Woodiyn Ridge Subdivision
Sarah Smith reviewed that at the November 8th meeting, the Council referred this item to Staff
for additional research, including financial scenarios and bonding, assessable costs and
information related to previous 429 projects. Hanus asked if bonding is switched to a Letter of
Credit, can it be drawn upon and distributed to others. John Dean answered that it would be an
Irrevocable Letter of Credit and is literally the same as cash.
Finance Director Catherine Pausche presented calculations of potential increase in City
property taxes, as well as a calculation of negative arbitrage based on different bond rates.
Hanus asked, with our yearly street project bonding, if we're reaching a threshold where interest
Mound City Council Minutes— February 14, 2012
rates may be affected because of our total bonded debt, and Pausche indicated that we're only
talking $340,000 here, and this would not have an effect.
Jeff Schoenwetter of JMS Custom Homes addressed the Council, summarized that the 5% pay
rate is important to them, which means tax exempt status is important. The five -year term that's
summarized in staff report is agreeable to them. The Letter of Credit is agreeable and he feels
that this makes more sense than bonding. He emphasized the rewards to the City on this
proposed project, including the increase in tax base. Prepayment of the assessment would
mean an increase in the tax base, so feels that any negative arbitrage would be minimal and
short - lived. He also stated that the closing of a property would trigger payoff of the assessment.
He requested that the Council approve to allow them to submit application for 429 financing.
Gillispie asked if the developer can at any time pay off the assessment early and Pausche
stated they could. This is a small project and the City can float this interest if they have to so
they shouldn't get hung up on the negative arbitrage. Hanus stated that as a representative of
the people who are paying tax dollars into the city, if one dollar of their tax dollars goes towards
helping fund a private housing development, they would be upset, and rightly so. He was
assured early on that there is no risk. Pausche stated that the letter of credit is the no risk.
John Dean asked Pausche if using a Letter of Credit to cover negative arbitrage makes it
taxable. She stated that negative arbitrage can't be assessed. Dean stated that is understood,
but the question is if the developer is guaranteeing payment of the negative arbitrage through
the letter of credit, is that a private activity that makes these bonds taxable? She indicated that
she wasn't sure and he stated that it's important that she find this out from bond counsel.
Gesch asked that if it is determined that the letter of credit can cover the negative arbitrage,
there is truly no way the City can lose out, and Dean stated that is true, unless something goes
wrong with the letter of credit, but another issue not handled yet is the size of the letter of credit
and if it can handle all risks. Gesch stated she needs answers to that before she could make a
decision on this.
Hanus stated that the applicant is asking the City to allow them to apply for 429 financing at this
point, and the City can get answers to the questions posed earlier before any action is taken on
that application. John Dean stated that Staff will also be drafting a 429 policy that will address
some of these concerns.
MOTION by Osmek, seconded by Salazar to allow the JMS Homes/Woodlyn Ridge to apply for
429 financing and require the applicant to come in with plans to eliminate the City's risk for
negative arbitrage. All voted in favor. Motion carried.
Mound City Council Minutes— February 14, 2012
8. Approve minutes
MOTION by Gesch, seconded by Osmek to approve the minutes of the January 24, 2012
regular meeting. The following voted in favor: Gillispie, Hanus, Gesch, Osmek. The following
voted against: None. Salazar abstained from voting because he was absent from that meeting.
Motion carried
9. Information /Miscellaneous
A. Comments /reports from Councilmembers /City Manager
B. Reports: LMCD Report on herbicide treatments
C. Minutes: Docks & Commons Commission — 1/19/12
D. Correspondence: None.
10. Adjourn
MOTION by Osmek, seconded by Gesch to adjourn at 8:52 p.m. All voted in favor. Motion
carried.
xt 4,"
Mayor Mark Hanus
Attest: Vicki Weber, Acting City Clerk
MOUND CITY COUNCIL
Thursday, February 16, 2012
The City Council of the City of Mound, Hennepin County, Minnesota, met in special
session on Thursday, February 16, 2012 at 6:30 p.m. in the Council Chambers of city
hall.
Members present: Mayor Mark Hanus; Councilmembers Kelli Gillispie, Dave Osmek,
Ray Salazar, and Heidi Gesch.
Others present: City Manager Kandis Hanson, Finance Director Catherine Pausche,
Community Development Director Sarah Smith, City Attorney John Dean, Jeff Andersen,
Shirley Andersen, Blaze Fugina, Deb Lowden, Lyn Conway, John Beise
1. Open meeting
Mayor Hanus called the meeting to order at 6:30 p.m.
Maureen Michalski of Schafer Richardson and Jenna Oscarson from Common Bond
Communities appeared before the Council with a preliminary concept plan for possible
future redevelopment of the north portion of the existing Commerce Place shopping
center for multi- family residential use to include 52 new rental units. Ms. Michalski
provided a brief overview of Schafer Richardson and explained preliminary details of the
Bay Breeze Commons concept proposal such as the site plan and anticipated rent
structure. It was noted that a similar concept plan was presented to the Council last year.
Ms. Oscarson provided some background on Common Bond as well as their previous
projects. They are looking for a letter of support from the Council which would be part
of their anticipated funding requests for the project which includes the use of tax credits.
Discussion took place about the current vacancies at the center including the former
Ridgeview Clinic space which has been unoccupied since 2007 and that redevelopment
of the north portion could spur a future redo of the south end. Councilmember Osmek
stated that TIF was used for the original shopping center project and commented that he
does not want to lose taxes as a result of a project. The displacement of the existing
tenants, who are longstanding businesses in Mound, was discussed and it was noted by
Ms. Michalski that tenants would be eligible for relocation benefits and could possibly
choose to locate in the south portion of the center which currently includes Walgreens.
The Council took no action. Mayor Hanus offered two informal conditions to the
developer representatives which included no loss of tax revenues and that written
agreements with the center tenants acknowledging their agreement with the move be
provided.
3.
Mayor Hanus gave an update of the shared services discussions with the City of
Minnetrista and St. Bonifacius for Police and Fire Services. The Mayor summarized a
proposal he made to the City of Minnetrista on December 12, 2011, that would lengthen
the term to 10 years from 3 years for our current contract for fire services as well as
expand the coverage area to all of Minnetrista. This may or may not involve a
subcontract with St. Boni Fire, depending on their willingness to cooperate. Mound will
be meeting with representatives of St. Boni on February 23, 2012 to discuss options.
The proposal also included the concept of a 10 year contract for police services to be
provided by Minnetrista to Mound and housed out of the new Minnetrista Public Safety
building. This will require Mound to find another use for the police portion of the Mound
Public Safety building, but the potential in savings may justify this plan. Minnetrista is to
present their proposal for Police Services on March 1, 2012. Although no official vote
was taken, members of the council agreed in concept with the approach taken in these
discussions.
4. Adiourn
MOTION by Osmek, seconded by Salazar to adjourn the meeting at 8:24 p.m. All voted
in favor. Motion carried. v
ff lV Chair Mark Hanus
Attest: Vicki Weber, Acting City Clerk