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82-05-25
CITY OF MOUND AGENDA Mound, Minnesota MOUND CITY COUNCIL May 25, 1982 Regular Meeting City Hall - 7:30 P.M. 1. Minutes of May ll, 1982, Regular Meeting 2. PUBLIC HEARINGS: A. Delinquent Utility Bills (To be handed out) B. Application for a Conditional Use Permit for Two Gasoline Pump Islands at PDQ Store 3. Some ideas on organizing a more formal and long-term cleanup campaign. 4. Problems with driveway gravel washing into the streets. 5.Comments & Suggestions from Citizens Present (please limit to 3 minutes) 6. Wine License Renewal - A1 & Alma's 7. License Renewals - Miscellaneous 8. Reconveyance to Hennepin County Various Tax Forfeiture Properties 9. Refunds - Wood Chipping Deposits 10. Resolution Authorizing the Submission of Community Development Activities for the City of Mound 11. Parking situation on Manchester - Gordy Swenson 12. Three Points Blvd. Signing - Report from Police Chief 13. Crosswalks Update - Bruce Wold 14. Street Signs - Information Memo 15. Bluebird Lane - Information Memo 16. Payment of Bills 17. Informatioon/Miscellaneous A. Letter from Senator Durenburger on IRS Ruley 80-58 B. Letter from Pollution Control Agency on Mike Reese passing his Class "D" Wastewater License C. Suburban Public Health Nurse Service Letter D. Presentation from Symposium on Small Business (A very.important document) E. Twin Cities Labor Market Information - May F. Sun Newspaper Editorial - May 12, 1982 on access G. Agenda - Minnehaha Creek Watershed District H. Notice regarding proposed modifications to Headwaters Control Structure/Management Policy I. WAFTA Minutes J. Letter from AWWA to Water Department K. Hennepin County Park Reserve District Redistricting Plan L. Background note - Re: Hockey Association 18. Executive Session with City Attorney - Legal Matter Pg. 1032-1040 Pg. 1041-1052 Pg. 1053 Pg. 1054 Pg. 1055-1059 Pg. 1060 Pg. 1061-1075 Pg. 1076 Pg. 1077-1078 Pg. 1079 Pg. 1080 Pg. lO81 Pg. 1082 Pg. 1083 Pg. 1084 Pg. 1085 Pg. 1086 Pg. 1087-1110 Pg. lill-lll4 Pg. 1115 Pg. Ill6-1117 Pg. lll8 Pg. lll9-1120 Pg. 1121 Pg. 1122-1124 Pg. 1125 Page 1031-A REGULAR MEETING OF THE CITY COUNCIL 96 May II, 1982 Pursuant to due call and notice thereof a regular meeting of the City Council of the City of Mound, Hennepin County, Minnesota was held at 5341Maywood Road in said City on May ll, 1982 at 7:30 P.M. Those present were: Mayor Rock Lindlan, Councilmembers Pinky Charon, Robert Polston and Gordon Swenson. Councilmember Donald Ulrick was absent and excused. Also present were: City Manager Jon Elam, City Engineer John Cameron, Police Chief Bruce Wold, City Clerk Fran Clark and the following interested citizens: Richard and Hazel Amundson, Thomas Stephenson, Bob Marquardt, Melvin Larson, Ronald Reisdorph, Elizabeth Jensen, Robert Hanson, John Wagman, Ann Thomas, Gladys Larson, Paula Reisdorph, Mary Prociw, John Lundquist, Gary Paulsen, Pat D-Aviza. The Mayor opened the meeting and welcomed the people in attendance. MINUTES: The minutes of the regular meeting on May 4, 1982 were presented for consideration. Charon moved and Swenson seconded a motion to approve the minutes of the May 4, 1982 regular meeting,as presented. The vote was unanimously in favor. Motion carried. PUBLIC HEARING - ON & OFF SALE BEER LICENSES - AMUNDSON'S MAIN ST. INC. The City Manager stated that the Police Department has concluded a background investigation and reported that they have found nothing as a result of the investigation to preclude the applicants from obtaining the requested license. Two items that were suggested by the Police Department were: 1. That parking be prohibited on the part of his lot that abuts Eagle Lane, because it blocks the view from Three Points Blvd. 2. That the rear parking lot be completed. The Mayor opened the public hearing. The Amundson~ stated that they have agreed to take care of the two items suggested by the Police Department. He will be putting posts in front of the building so that there will be not further parking in that area and he is getting bids right now to complete the parking lot in the rear of the building. Tom Stephenson,.Melvin Larson, Pat D~Aviza, Mary Prociw, Bob Marquardt, Gladys Larson and Paula Reisdorph gave the following examples of problems they have had with Rager's Pub: 1. Parking in the front of the building causing a dangerous situation pulling onto Three Points Blvd. from the side streets, especially Eagle Lane and Finch Lane. 2. Noise in the parking lot after closing. 3. Keeping doors and windows open and playing loud music. 4. People throwing beer cans at neighboring homes and littering yards. 5. Using the Commons docking area for commercial docks. 6. The unsightly parking lot in the rear of the building. Mrs. Amundson explained that she and her husband want to make this area their permanent home and would like to have a family restaurant that everyone, including the neighborhood will enjoy. They do not plan to have disco, are 97 May ll, 1982 working on the air conditioning right now so the doors and windows will be keep closed and any suggestions from the neighbors will be taken into consideration. The Council informed the Amundsons that they cannot use Commons docks for commercial docking. The Mayor closed the public hearing. Swenson moved and Charon seconded the following resolution. RESOLUTION #82-137 RESOLUTION TO GRANT THE "ON & OFF SALE BEER LICENSES" TO AMUNDSON'S MAIN ST. INC. STIPULATING TWO CONDITIONS There was discussion by the Council. Councilmember Polston suggested that the Amundsons could provide a bond to assure completion of the parking lot in the rear in a specific time frame. The remainder of the Council felt that putting the two stipulations on the License would be sufficient. Polston moved to amend Resolution #82-137 adding that the Amundsons provide a $5,000 Bond to assure the parking lot work is completed within 90 days. The motion died for lack of a second. The vote on the origlnal resolution was unanimously in favor. Motion carried. Swenson moved and Polston seconded the following resolution. RESOLUTION #82-138 RESOLUTION AUTHORIZING ISSUANCE OF 6 MISCELLANEOUS LICENSES TO AMUNDSON'S MAIN ST. INC. AS LISTED ON PAGE 962 OF THE COUNCIL PACKET The vote was 3 in favor with Councilmember Charon voting no. Motion carried. PLANNING CO~MISSION ITEMS A. FENCE HEIGHT VARIANCE - DUANE SCHALLER - LOT 8, BLOCK 18, SETON The City Manager explained that Mr. Schaller is asking for a variance to construct a 5 foot chain link fence on his property to keep fishermen, cars and boats off his property. Section 55.17 of the City Code states "fencing in the front yard is limited in height to 42 inches". The lot he proposes to construct the fence on is across the street from his home and is an unbuildable lot. The Planning Commission approved this variance Swenson moved and Charon seconded the following resolution. RESOLUTION #82-139 RESOLUTION TO CONCUR WITH THE PLANNING COMMISSION AND GRANT A VARIANCE OF 1.5 FEET IN THE FENCE HEIGHT. Councilmember Polston stated that he would have to vote no on this issue because: 1. He doesn't want to set a precedence by granting this height variance. 2. He felt that any variance required a survey and Mr. Schaller has not presented one. 98 May ll, 1982 Councilmember Swenson asked the Chair to call for the question. A roll call vote was 3 in favor with Councilmember Polston abstaining because he felt he was not prepared to vote. Motion carried. VARIANCE - THOMAS STEPHENSON - PT OF LOTS 5,6,7, & 8, BLOCK 13, DREAMWOOD The City Manager explained that this is a problem that has been ~oing on for years. Mr. Stephenson's home is encroaching on the Commons 1'6" and he would once and for all like to get it off of Commons and entirely on his own lot. He has proposed to remove 2 feet of the corner of his home and then he will be 6" inside his property. The ordinance calls for 6' from the property line so he is asking for a 5½ foot variance. The Planning Commission has approved this variance. Swenson moved and Polston seconded the following resolution. RESOLUTION #82-I~0 RESOLUTION TO GRANT A VARIANCE OF 5½ FEET FOR THE ONE CORNER OF THE HOME THAT IS NEAREST THE COMMONS The ~ote was unanimously in favor. Motion carried. ANN THOMAS - DOWNTOWN PEDESTRIAN SAFETY Ann Thomas and Mr. John Lundqulst were present and voiced their concern for pedestrian safety in downtown Mound. They would like to see drivers made aware that pedestrians have the right-of-way when in the crosswalks. Ms. Thomas suggested that when the signs signifying crosswalks are put up, they are alone on the post rather than having other signs around them which make it harder for the drivers to see. She also suggested that the stop light be set to give people more time to cross the street. The Mayor suggested having a square reflector sign in a bright color be placed over the pedestrian crossing signs to call drivers attention to the crossings. Police Chief. Bruce Wold, stated that he is working with the'County on all of these items and that he and Ms. Thomas will be submitting articles to The Laker bn driver awareness for pedestrian safety. The following crosswalks are being installed on County Road 110: 1. One at Mound Bay Park. 2. One at Auditor's Road. 3. Two at the intersection of County Rds.. 15 and I10. 4. One miS-block between County Road 15 and Lynwood Blvd. 5. One at the Anderson Building corner of Lynwood across County Rd. 110. 6. One at Church Road by the parking lot. 7. One at the Library. 8. One at 2020 Commerce by Balsam. He explained that the County does not want to put a crosswalk by Our Lady of the Lake Catholic Church because of bad visibility with the curve on County Rd. llO. The Council suggested 2 other sites: 1. At Three Points Blvd. across County Road IlO. 2. On County Road 15 at the House of Moy. 99 May II, 1982 The County has said they will put crosswalks just about anywhere we want but after they are put in the City will have to maintain them. The Council thanked Ann Thomas and John Lundquist for their presentations. COMMENTS AND SUGGESTIONS FROM CITIZENS PRESENT The Mayor asked for any comments or suggestions from citizens present. There were none. 3.2 BEER PERMIT - MOUND VOLUNTEER FIRE DEPARTMENT The Mound Volunteer Fire Department is having their Fish Fry on June 12 and 13, 1982. They are asking for a Charitable Organization 3.2 Beer Permit for those two days and are asking that the bond and permit fee be waived. Swenson moved and Charon seconded the following resolution. RESOLUTION #82-1~1 RESOLUTION TO APPROVE THE 3.2 BEER PERMIT FOR THE MOUND VOLUNTEER FIRE DEPT. FOR JUNE 12 AND 13, 1982 WAIVING THE BOND AND PERMIT FEE The vote was unanimously in favor. Motion carried. DRAINAGE PROBLEMS - BLOCK 10, WOODLAND POINT - BETWEEN EAGLE AND DOVE LANES The City Manager explained that the owner of Lots 4, 5 and ½ of 3 has asked that the City get the water off these lots so he can make it a buildable site. The water the owner is referring to comes from the culvert that crosses Eagle Lane, follows the small ditch through Block 10 and across his lots and goes over to Dove Lane. The Council asked the City Engineer why this was not corrected during the street projects. City Engineer John Cameron stated that "when Eagle Lane was improved in 1975, the minimum storm sewers were constructed to save costs, since only a few scattered streets were included in the project and it was not possible to provide areawide storm sewers. The City Manager explained that there are 3 alternatives: Alternative #I costing $3,200.00 (which the engineer does not advise) Alternative #2 costing $9,700.00 Alternative #3 costing $14,450.OO The City Engineer pointed out that traditionally, this type of work is done by the property owners themselves because this area was always a natural drainage way. The Council asked if there were any other areas around this one that also needed storm sewer. The Engineer stated that he would have to check the 3 Points area and see. The Council did not want to have the Engineer prepare a preliminary plan and expend alot of money if the project is not going to be done for sure. 100 May Il, 1982 Polston moved and Swenson seconded a motion to have the City Engineer obtain additional preliminary information on this drainage problem as follows: 1. See where the watershed is for this connection. 2. Verify if it can be connected to the storm sewer in Jennlngs Road. 3. See if there are other problems in the 3 Points area that need correcting. The vote was unanimously in favor. Motion carried. COMPREHENSIVE PLAN The City Manager explained that Mound's Comprehensive Plan was approved by the Planning Commission about 2 or 3 months ago and that the Council has 9 months to approve it per the Metro Council, who have also approved the plan. His original thought was to go over the entire plan and refine it where it was needed but time is against that so he is recommending that the Council approve the plan the then we can review it piece by piece. Swenson moved and Polston seconded'the following resolution. RESOLUTION #82-14~ RESOLUTION APPROVING THE CITY OF MOUND COMPREHENSIVE PLAN DATED NOVEMBER 10, 1981 The vote was unanimously in favor. Motion carried. PARKING LOT LIGHT BY MEDICAL CLINIC The City Manager explained that we are now ready to install a security light in the parking lot that the City and the Medical Clinic Share. Mr. Ron Roelofs donated the light fixture. The pole and the installation will cost approximately $1,692.00 and the Clinic has agreed to share this cost 50-50. The Clinic will also pay ½ the monthly lighting costs. Polston moved and Charon seconded the following resolution. RESOLUTION #82-143 RESOLUTION ACCEPTING THE SECURITY LIGHT AND AUTHORIZING THE CITY MANAGER TO ENTER INTO A CONTRACT WITH THE ALL-STAR ELECTRIC FOR INSTALLATION ½ COSTS AND MONTHLY SERVICE TO BE BILLED TO THE MOUND MEDICAL CLINIC The vote was unanimously in favor. Motion carried. PAYMENT OF BILLS Polston moved and Swenson seconded a motion to approve the payment of bills as presented on the pre-list in the amount of $93,163.86, when funds are available. Roll call vote was unanimously in favor. Motion carried. WETLANDS ORDINANCE The City Attorney has advised the City Manager that we will have to reapprove the Wetlands Ordinance because the wetlands map was changed after the approval to make it as accurate as possible. The City Attorney also wants to make some language changes in the ordinance. Thus the Council will have to hold another public hearing on the Wetlands Ordinance and Map. 101 May Il, 1982 Swenson moved and Polston seconded the following resolution. RESOLUTION #82-144 RESOLUTION SETTING THE DATE FOR THE PUBLIC HEARING OF THE WETLANDS ORDINANCE AND MAP FOR JUNE 8, 1982 AT 7:30 P.M. The vote was unanimously in favor. Motion carried OVERLAY PROJECT - PRIEST LANE,. RUSTIC RIDGE, GUMWOOD ROAD, LANG.DON LANE The City Manager read the City Engineer's report on the overlay of the above streets. The Engineer is estimating the cost of a 2½" overlay on Priest Lane at $9,800. On Rustic Ridge he estimates a 1½" overlay at $4,000. Gumwood Road and Langdon Lane, he feels, have some moisture problems in the subgrade which will continue to cause break-ups even with an overlay. So they feel that these two streets should be reconstructed, with subsurface drainage, curb and gutter and 5" of bituminous surfacing at an estimated cost of $96,000.00. The Engineer explained that Gumwood and Langdon were put in in 1963 and have not been maintained well. These two streets were designed by Schoell & Madsen Engineering so McCombs has no plans for these streets and is not sure what the base was. The Council directed the Engineer to drill holes in the street to see what the thickness of the blacktop is and see if they can find out what the base is. In the meantime, the City can meet informally with the people in the neighborhood and see what their feelings are about having the street reconStructed. Polston moved and Swenson seconded a motion to authorize solicitation of quotations for an overlay on Priests Lane. The vote was unanimously in favor. Motion carried. Swenson moved and Charon seconded a motion to authorize solicitation of quotations for an overlay on Rustic Ridge. The vote was unanimously in favor. Motion carried. WESTONKA SENIOR CITIZEN HOUSING The City Manager reported that he has received a letter from Hennepin County stating that it would be beneficial to the Westonka 202 development process if the City of Mound would reprogram $2,000 - $3,000 in previous year CDBG funds into a Year VII activity for the Westonka Housing project. These reprogrammed funds would be used to provide acquisition consultant assistance in securing the necessary purchase option. This reprogramming requires a public hearing and City Council resolution. Charon moved and Swenson seconded a motion to set the date for a public hearing for the purpose of amending the Urban Hennepin County Community Development Program for the program Year VII for June 8, 1982 at 7:30 P.M. The vote was unanimously in favor. Motion carried. DOWNTOWN ADVISORY COMMITTEE The City Manager reported that the Downtown Advisory Committee has selected a firm for design services. It is Ernst Associates Landscape Architects. Their proposal is within the budget guidelines of $4,000. 102 May 11, 1982 Polston moved and Charon seconded a motion authorizing the Mayor and the City Manager to sign a contract with Ernst Associates for Downtown Design Services for building and streetscapes as outlined in their proposal and approved by the Downtown Advisory Committee. The vote was unanimously in favor. Motion carried. INFORMATION/MISCELLANEOUS - The City Manager provided information on the following: A. REQUEST FOR ENDORSEMENT - JAN HAUGEN, CITY OF SHOREW00D The City Manager reported that Jan Haugen from the City of Shorewood wishes to be endorsed by the City of Mound for a position on the League of Cities Board of Directors. A letter will be written to the Nominating Committee recommending her endorsement. WESTONKA SENIOR CITIZEN TASK FORCE The City Manager reported that the Task Force has had two meeting and is negotiating to purchase Our Lady of the Lake Annex and the land South of there for senior citizen housing. There are three other sites but this one seems to be the most feasible. LETTER FROM FRANK J. BUYSSE AND FRITZ WIDMER A letter signed by Frank J. Buysseand Fritz Widmer granting a 30 day extension of the purchase agreement on the proposed new maintenance building on County Road 110. The agreement will now expire June I, 1982.' LETTER FROM DONALD SHIPMAN A letter from Donnie's on the Lake complimenting the Police Dept. on their prompt response to two separate calls. LETTER FROM THE CITY OF WAYZATA A letter from the City of Wayzata appointing Toni. Riley to serve on the L.M.C,D. ad hoc committee. F. L.M.C.D. MAy MEETING SCHEDULE - selfexplanatory ANNUAL MOUND CITY WIDE TRASH PICK-UP SCHEDULE The city wide trash pick-up will be held May 17th - Precincts I & II; May 18th - Precincts V & VI; and May 19th - Precincts Ill & IV. H. LETTER FROM HENNEPIN COUNTY ON POLICE COMMUNICATIONS Progress report on the public safety communication upgrading project. SUBURBAN RATE AUTHORITY MINUTES & MATERIALS The Minutes of the April 21st meeting and the March 31st Executive Meeting. A survey of sewer rates for major metropolitan areas in the United States. Councilmember Swenson asked that the parking ordinance be amended to allow parking on the North side of Balsam from Commerce Blvd. to Spruce. At present there is no parking on the North side and the South side has too many driveways, which allows very few cars parking spaces. He has been asked by the residents of 2020 Commerce to act on this. 103 Hay 11, 19'82 Swenson moved and Polston seconded the following: ORDINANCE #432 AN ORDINANCE AMEt~DING SECTION 46.29, SUBSECTION 61 (c) BY ADDING #10 "NO PARKING ANYTIME" ON THE SOUTH SIDE OF BALSAM ROAD FROM COMMERCE BLVD. TO SPRUCE ROAD AND ALSO AMENDING SECTION 46.29, SUBSECTION 58 (e) BY DELETING IT. The vote was'unanimously in'favor. Motion carried. Counc|Imember Charon.moved. and SWenson seconded a motion to adjourn at 10:35 P.M. The vote was unanimously in favor. Motion carried. Fran Clark, City Clerk Elam, City Manager 11-052-5001-11 ;2-5054-01 ~55-5024-61 11-055-5139-21 11-58-5000-01 11-067-1753-71 11-067-1761-21 11-067-1920-41 11-070-1921-61 11-070-4625-01 11-082-1725-61 11-085-4987-21 11-088-5773-91 11-112-5971-71 11-136-2168-21 11-154-2221-21 11-155-2214-41 11-169-5226-61 5932-91 11-175-5444-21 11-193-2146-91 11-211-2136-01 11-214-2161-21 Delinquent Utility Bil $ ls 80.75 51.00 48.74 72.68 70.17 90.07 57.62 136.80 125.97 174.23 60.00 47.74 105.87 95.90 375.59 55.25 239.00 45.05 48.48 77.80 162.16 61.72 99.22 5-24-82 $2381.81 BILLS ..... MAY 11, 1982 Acro-Minnesota 329.47 Holly Bostrom 144.00 Bryan Rock Prod. 129.97 Jan Bertrand 18.48 Curtis 1000 428.02 Fran Clark 31.69 Lance Coppin 362.50 Consol idated Micrographic 103.79 Robert Cheney 334.00 Dependable Services 33.00 Jon Elam 32.68 First Bank-Mpls. 80.00 Flaherty Equip Corp 87.10 James Ford 400.00 Geffre Carpet Serv. 1,139.48 Glenwood Inglewood 43.80 Gopher Sign 30.02 Eugene Hickok & Assoc 136.00 George M. Hansen Co. 3,200.00 Jones Chemicals 249.00 John Janske 400.00 Jabco Home Improv. (HUD) 2,880.88 Kromer Co. 177.67 The Laker 65.87 Doris Lepsch 30.00 Lutz Tree Service 975.00 MacQueen Equip 27,000.00 Marina Auto Supply 348.34 Minnegasco 1,049.33 Mound Fire Dept 4,466.50 MN City Mgmt Assn 25.00 Mn Recreation & Park 90.00 Minn Comm 28.50 Maple Plain Diesel 310.24 City of Mound 200.00 McMaster-Carr 286.31 Mound Postmaster 122.64 Modern Express 23.50 David & Barbara Miller 950.00 Northland Elec Supply 184.66 Official Reporters 172.50 Planning & Develop Serv 625.00 Pitney Bowes 49.50 Harold Reiner 302.50 Joel Seitz 400.00 State Treas-Surplus 8.00 Smokeater 51.00 State of MN Document 9.00 Title Ins. 782.00 T & T Maintenance 50.31 Univ of MN 195.00 " " 90.00 West Suburban Prop 109.00 Wurst, Carroll, Pearson '6,818.97 Widmer Bros. 366.00 Westonka Sanitation 2,485.00 Westonka Firestone 15.59 TOTAL BILLS 59,456.81 LIQUOR BILLS Holly Bostrom 110.OO Bradley Exterminating 19.00 Real One Acquisition 675.00 Regal Window Clean 10.75 Nels Schernau 11.99 Butch's Bar Supply 164.40 City Club Distrib 2,670.95 Coca Cola Bottling 347.65. Day Distrib 3,254.55 East Side Beverage 2,994.77 Gold Medal Beverage 117.OO Home Juice 37.56 Jude Candy 225.00 Kool Kube Ice 195.60 The Liquor House 944.55 Midwest Wine 1,049.15 A.J. Ogle Co. 1,995.40 Pepsi Cola/7 Up ~234.75 Pogreba Distrib 3,675.17 Thorpe Distrib 4,493.65 Griggs, Cooper 3,088.76 Johnson Bros. Liquor 3,467.99 Old Peoria 2,401.53 Ed Phillips & Sons 1,215.57 Johnson Paper Co. 306.31 TOTAL LIQUOR BILLS 33,707.05 GRAND TOTAL--ALL BILLS 93,163.86 CITY OF MOUND Mound, Minnesota NOTICE OF HEARING ON APPLICATION FOR A CONDITI. ONAL USE PERMI. T FOR TWO GASOLINE PUMP ISLANDS AT PDQ FOOD STORE NOTICE IS HEREBY GIVEN THAT ON.Tuesday, May 25', 1982, at 7:30 P.M. at the City Hall, 5341Maywood Road, Mound, Minnesota, a hearing will be held on the application for a Conditional Use Permit for two Gasoline Pump Islands at the PDQ Food Store, 5550 Three Point Boulevard, property described as: That part of Lots 26 and 27, Lafayette Park, Lake Mlnnetonka, described as follows: Commencing at a point on the West line of Government Lot 4, Section 13, Township 117 North, Range 24 West of the 5th Principal Meridian; distant 848.6 feet South of the Northwest corner of said Government Lot: thence North 89°30' East along the centerline of public road a distance of ~83 feet;.~thence North parallel with said West line (which has a bearing;"of North for purposes of this description) a distance of 33 feet to the Northerly righ't-of-way line of said road, said point being the point of beginning of the property being described; thence continuing t~orth 125 feet: thence. South 88o30' West a distance of 250 feet more or less to said right- of-way line: thence Southwesterly and EasterIy along said right-of-way line to the point of beginning. (PID 13-117-24 22 0017) All persons appearing at said hearing will be given an oppor- tunity to be heard. Francene C. Clark, City Clerk (Publish in The Laker May II, 1982) APPLICATION FCI. RI$~E'CrA'L USE P~F{I~IT FEE OWNER l:~)~. Food Sto)L~..& O~ ~ PLAT ~7~ ADDRE~ ~01 E. 77th ~. TELEPHONE LOCATIONOF ~HE PROPERTY 5~50 T~ PO~ ~vd. FEE $ /00. O~ 6210 PARCEL 861-4417 LEGAL DESCRIPTION ZONING SPECIAL USE PERMIT (use) I~tall ~a~oline dispe~ing equipment pe~ attached Signature of Applicant Address Applicant's Interest in Property Tel. No. OO~1- /-J~/J7 Bu~ine~ operator unde~ long term net net net lectse State why thi's use, if granted, would not be contrary to the general purpose and intent of the ordinance to secure public health, safety, general welfare, and sub- stantial justice. Thls ls ct very eomlo~ble ope,'ta, tion wi~h o~r existing business. Residents and owners, of property within See at~ached mt feet: PLANNING COMMI~ION RECOMMENDATION:_.ApprOval of the Conditional Use Permit for 2 Gasoline Pump Islands with the Building Inspector's reco,mmendations (see Pia,nnlng Commission minutes of April 26, 1982 DATE April 26, 1982 COUNCIL ACTION 5-4-82 Council set May 25, t982 as date for public hearing. Resolution no. DATE CITY OF MOUND Mound, Minnesota · Planning Commission Agenda of April 26, 1982: Board of Appeals Case No. 82-109 5550 Three Points Boulevard (PDQ) Part of Lots 26 & 27, Lafayette Park, Lake Minnetonka Request - Conditional Use to construct (2) dual gasoline pump islands Zoning District B-2 Applicant: PDQ Food Stores of MN 607 E. 77th Street Minneapolis, MN. 55423 Phone: 861-4417 The applicant is requesting a conditional use to update (2) dual pumps to sell gasoline on their property. The site plan accompanying my letter shows 29 parking stalls, 3 underground tanks which have been approved by the State Fire Marshall according to the applicant, two (2) 28 foot wide driveway access points, the gas pump locations, a 92 X 40 foot building of which 1200 square feet is office rental and 2480 square feet is the PDQ Superette. The applicant has previously requested a parking and rear yard variance and use permit to construct the building. A sign variance has also been granted pre- viously. Both Resolutions #77-513 and #78-~74 are attached. In July of 1978, Resolution #78-326 (also attached) was adopted to deny a special use permit to install gasoline pumps at the site. Under the provisions of the newly adopted zoning ordinance for the B-2 Zoning District, Retail Businesses - stores and shops selling household goods over the counter and offices are a Permitted Use. The ordinance also states that a Drive-In Retailing establishment is a Permitted Use, but under the definition of a Drive-In, 23.301(33), states "Any use where products and/or services are provided to the customer under conditions where the customer does not have to leave the car or where fast service to the automobile occupants is a service offered regardless of whether service is also provided with a building." Motor Fuel Stations are provided by Conditional Use, which I feel defines a self- service or general purpose gas station. The performance standards under Section 7 for the Auto Service Stations, 23.718.1, require a site of 20,000 square feet. This site exceeds this requirement at approximately 31,O00 square foot. The building setbacks do not meet requirements. It is not near residential. Sec- tion 23.718.2 states the setback is to be 35 feet from the street right-of-way. It is 22 feet from Commerce Boulevard and 88 feet~ from Three Points Boulevard. Section 23.718.3 requires curb and §utters which are presently installed and meet the requirements. Section 23.718.4 Fencing and Screening - When adjacent to commercial property, there shall be a bumper-type fence about 18 inches high between the station and the adjacent commercial property. Section 23.718.5 Architecture - This portion applies to the building which is al- ready on the site and is not applicable. Planning Commission Agenda of April 26, 1982 Board of Appeals - Case No. 82-109 Page 2 Section 23.718.6 Outdoor Displays - This item has not been requested and probably should be addressed or restricted. The picture submitted from a different site shows no outdoor displays. Section 23.718.7 Business activities not listed in the definition of service sta- tions in this Ordinance are not permitted on the premises of a service station unless a conditional use permit is obtained specifically for such business. Section 23.716 Parking - The parking requirements for the site are as follows: Retail Store 2480 Sq. Ft. = 1 space per 150 sq. ft. Office 1200 Sq. Ft. = 1 space per 400 sq. ft. Auto Service Station = 2 spaces plus 4 per service station stall Retail Store 16.5/17 X 325 Sq. Ft. = 5,525 Sq. Ft. Office 3 spaces X 325 Sq. Ft. = 975 Sq. Ft. Gas Station 2 spaces X 325 Sq. Ft. = 650 Sq. Ft. 22 Spaces 7,150 Sq. Ft. Area Total lot area designated to 10 X 20 feet parking and one 12 X 20 foot handicap Parking stall and landscaping is approximately 19,500 square feet excluding 5,000 square feet for the gas service pump area. Recommend: I would recommend approval of the self-service gas pump conditional use permit subject to the following: 1. No outdoor display of saleable merchandise be allowed. 2. Waiving the bumper-type 18 inch fence requirement. Require the same procedure as presently being used to police the area for any debris. 3.A favorable traffic recommendation form the Police Chief. 4. That the State Fire Marshal requirements be met as stated on the site plan such as a) safety pump shut-offs, b) necessary SIGNS posted for: No Smoking, Shut-off Vehicle, Operating In- structions, no person under 16 years of age is permitted to operate self-service pumps, c) intercomm, d) attendant to have full view of each pump while being used', e) necessary fire extinguishers available, f) no hold open nozzles (person must hold nozzle open when using self-service) 5.Signed plan from State Fire Marshal for underground storage tanks. 6. Recognized that this use is accessory to the principal use of the site in that the principal use is Retail/Office for the building. Refer to City Council - May 4, 1982 to set date for public hearing. MINUTES OF THE MOUND ADVISORY PLANNING COMMISSION MEETING April 26, 1982' Conditi°nal Use Permit.to Construct 2 Gasoline Pump Islands at PDQ Food Store Part of Lots 26 and 27, Lafayette Park, Lake MInnetonka Applicant .was not present. City Manager explained that the PD~ Food Store Is having a hard ti. me bringing in traffic and feel that 'the viability of the store needs the gas pumps, Dis- cussed. Wella~d moved and Paulsen seconded.a motion.to recommend approval of the Conditional Use permit for 2 Gasoline. Pump Islands with the Building Inspectorls recommendations which are: A. No outdoor display of saleable merchandise be allowed. B. Waiving the bumpe~-type 18 inch fence, requirement. Require the same procedure as.presently being used to police the area for any debris. C. A favorable, traffic recommendation from the Police Chief. D. That the State Fire Marshal requirements'be met as stated on the site plan.such as 1) safety pump shut-offs, 2) necessary SIGNS posted ~or: No Smoking, Shut-off Vehicle, Operating Instructions, no person under 16 years of age is permitted .to operate self-service pumps, 3) inter- comm,'4) attendant tO have full view of each pump while being used, 5) necessary fire extinguishers.availa'ble and 6) no hbld open nozzles (person must hold nozzle open when using self-service) E. Signed plan from State Fire Marshal for underground storage tanks. Recognize that this use is accessory to the.principal use of the site in that the principal use ls Retail/Office for the building. The vote was unanimously in favor. "09 '.L9 QN~: OOgt BNOI/Yq'IVJ, BNI-~:)IAU]II-8~qVg UJq~I.LgA9 J.N;ll~dlnO:l HfllqOW.Ll'd 'ONI ::lOl^l::lg$ 1::I'4.L31AI $' dlAInd (OLL '00) c~AqB ~IOB3~I~O0 PS 06013-01 (08/79) DIVISION OF STATE FIRE MARSHAL !~,4~ UI'~IVI'RflTY AVENUE ~T. PAUL. MINNI~IOTA BI~I04 LEPHONIEt (61s') ~'96-7641 April 27, 1982 p~mp and Meter Service, Inc. 1800 2nd Street South Hopkins, M~ 55343 :~ STATE OF MINNESOTA DEPARTMENT OF PUBLIC SAFETY Control Re: 82061180 PDQ Food Stores, Mound, MN new:installation - self-service, underground steel storage tanks. (1) 12,000 gal. (super gas) (i).12,000 gal. (unlead gas) (1) 12,000 gal. (reg. gas) To Whom it may Concern: ~ The plans for the above installation have been reviewed pursuant to Minnesota Statutes, 1974, Chapter 299F.19. Preliminary approval is given 'for the~aforementioned project subject to compliance with the provisions of Minnesota Statutes, State Fire Marshal egulations, and local ordinances and permits. Construction shall be in onfo~mance with the standards contained in National Fire Protection Association Pamphlet 30, Flammable and Combustible Liquids Code (1973 edition as amended). Final approval will be given, following an inspection of th6 facility by either your area State Fire/Arson Investigator and/or local fire authority. Approval of the project described in this letter does not relieve the applicant of responsibility, to other Federal, State or local agencies regarding adherence to regulations or the need to obtain necessary approval. Questions concerning this project should be addressed in writing to our office for a formal resp?nse. Please refer to the control number listed above in all future correspondence concerning this project. Yours very truly, Wes Werner, State Fire Marshal '~L~h a~r d Ki~stein tats Fire Codes/Plans Specialist OPY DISTRI~I~flON: White'Facility, Blue-Fire Department, G~een-Central Office, Pink-Codes/Plans Specialist,--G~6~d-Fire/Arson Inves~g-t~W~or, Yellow-Po-II~tion Control Agency AN EQUAL OPPORTUNITY EMPLOYER for James .~efriEera~ion Co. in Lots 26 sm/. 27, l~,fsyet%e Park llennep/.~ County, l,~.inneso~ Certiftca%~ of S~'vey: of that ~rt of ~ .26 and 27 Lhfa,.et~ ~.-~-' .,_ '...- . _ . -.. . ~ ..... ~a~ea ~a at a in. ,: . . ~. _ .~ ~-a~ 4.~eLon~, cescrl~d us 'follows: Co~n _ ~ t on tho -h-t lin.. uf ~ovcm~nt eot &,"Section 13, To,ma:hi, 117 North, ~nue ~ ~st of the 5th i=inci~l.l.~rici,m, dis~nt ~8.6 feet South of %he I~or~weut corner of said ~vcm~nt imf; thence l:orth ~8°30, ~t alonE the cental'line of ~ublic road a distance of 283 feet; thence I;orih ~rallcl ~'i~h se~d ~st tine (~hlch he=, an a~z~ed ~arin6 of ~!orth for p~ ~ses of t%ln ~'er. crt~tton) ~ dir~nce of 33 fuo~ ~ the I;ortburly rich~of_~;~2 It.ne of said ~ad, , said ~int b~.tnE the votnt of ~Etnrlnl. of the property belna d~crD~d; thence centring North ~5 feet; tb~ce f~utb 8~30' ~st a dt~%'mce o~ 250 feet r~rc or l.~cm te ~id ritlh~,-of-vay line; thence Southe,,atcrl - i,nd F;,e~rlp- ~lonl; ~:~!~ rJ;~h~cf-~,ay l~n,~ ta ~h.. ~in~ of t~g~mling, a~ Co~netn. ',t the I:orth~.a~t ct, mcr of ssid Section 13; %hence on en ess~d ~nrtn~ of Sou~ alon;; tho Ucvt 1~o of cutd section a dts~nce of 8Z8.~ fecL~ t},enc= Korth 8~30' ~s~ ~0.02 f6et; thence I~rth l°30' West..33 feet; thence South B8o30, lJ~ut ~.O2 feet ~ the-~int of ~Ein~nj; th.race contlnuinS SoUt~ ~°30, West 82.80 feet; thence Iiorth~nterly 79.85 feet along a 9mgentlcl c~,e, cone, ye to the I~rtheust, ~v~g a ~dtus of 50 feet and .cent~ angle of 91030'; thence o~ :; ~=r!n,.-of ~rth, ~.~ feet ~ the ~or~cas~rlF line of T~wee Points ~eva~; %~e,r~ So~%h~asterl.;. elonC thc' I~ortherly line. of Three Po~ts ~ev:~ to the ~t of beginntnc, thc ioc=tton of ell e~ettng b~ldint;s, if uny, thereon, nni the pressed loca- tion of u Dry,sa'ed b~l~inl'. It does not p~rt to ahou other im~ve~nts or encrocchmn~. ~ : 4-1~7~ ~on R~ Coffin · · ~ No. ~ ~ S~eyor and P~er o : Iron ~r~r ~n[ ~k~, Pinneso~ DEPARTMENT of public Safety TO : ~11 Assistant State Fire Marshals STATE OF MINNESOTA O[fice Memorandum DATE: September 17~ 1974 FROM : Wes Werner SUBJECT: Self Service Gasoline Stations Effective August 1~ 1974 Just thought .you might want'a brief resume on the added things . required at"a gasoline service station ~nen Self Service Marke6tng Policy is involved~ 1, There shall be a separate emergency electrical switch close to the attendant control center to shut off one or all dispensing units in the event of an emergency. 2. Necessary signs to be conspicuously posted at each pump island and/or pump: warning to-shut off vehicle motor--NO S~DKING OR OPEN FLAME (b) Complete operating instructions (c) No person under 16 years of age permitted to operate self service pumps Intercormmbetween each pump island and attendant. 4. Attendant must have full view of each pump while being used,. 5. Necessary fire extinguishers available, 6. No hold open nozzles. (Persqn must hold nozzle open when using self-service.) ~.v /,¢Z-O 340 July 11, 1978 Councilmember Swenson moved the following resolution, RESOLUTION 78-326 RESOLUTION TO DENY THE SPECIAL USE PERMIT FOR A GAS SERVICE ISLAND DUE TO THE LACK OF ADEQUATE PARKING FACILITIES WHEREAS, at the Council meeting of June 6,.1978, Res.,78-271 was approved, call- ing for!a Public Hearing on a Special Use Permit for the sale of gaso- line through the installation of two gasoline pumps at Three Points Corner, described as District 85, Plat 61690, Parcel 6210, and WHEREAS, it was agreed that gas pumps were not necessary for the use of the above described property, and WHEREAS, said gas pump installation would cause undue traffic congestion and con- funsion at this corner and limit parking area. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF MOUND, MOUND, MINNESOTA: That Council does hereby deny the request for a Special Use Permit for a gas service island due to lack of adequate park- ing facilities. The motion for the adoption of the foregoing resolution was duly seconded by Member Withhart, and upon vote being taken thereon, the following voted in favor thereof: Lovaasen, Swenson, Fenstad, Polston and Withhart, the follow- ing voted against the same: none, whereupon said resolution was declared passed and adopted, signed by the Mayor and his signature attested ~by the City Clerk. / ~ Mayor ~ At,st: City Clerk Councilman [enstad moved the fo]lo~[.n~ resolution~ October 10, 197B RESOLUTION NO. 78-474 ~ESOLUTION TO CONCUR ~ITH THE RECOHHENDATiON OF THE PLANNING COMMISSION WHEREAS, owners of property described as Part of Lot 26, Lafayette Park plat ~1~90 parcel ~210 and identified a~ the P.D.Q. Market have requested a sign variance, and WHEREAS, the position of the free standing sign has been checked oqt'.by the Police Chief and Buildi.ng Inspector and there doesn't appear to be a safety hazard, and WHEREAS, variance would apply to two signs 30" X 8' to be along the faca of the building and a free standing sign 8' X 11'. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF MOUND, MOUND, MINNESOTA: That Council concurs with the recommendation of the Planning Commission and does hereby authorize and direct that a sign variance be issued to P.D.Q. for sizes stated above. The motion for the'adoption of the foregoing resolution was duly seconded by Councilmember Lovaasen and upon vote being taken thereon, the following voted in favor thereof: Fenstad,'Lovaasen, Swenson, the foJlowing voted against.the same: Polston and Withha~t: whereupon said resolution was de- - clared passed and. adopted, signed by the Mayor and his signature attested to by the City Clerk. Atte~t:~City Clerk .s/Tim Lovaasen Mayor May 19, 1982 CITY of MOUND 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 TO: CITY COUNCIL FROM: JON ELAM, CITY MANAGER SUBJECT: CLEAN-UP CAMPAIGN The response to the need to clean-up the City is something that is most difficult to get a handle on. At this point all we are doing is responding call by call, which means that if you live next door to someone who complains, the wrath of the City can come down on you and if you don't, it won't. Like alot of ideas, I think we can do it better. First, through, what is our ~o~l? Is it to clean-up the town at all costs or is it meant to zero in on those very bad cases? If it is to clean-up the town totally, and there appears to be alot of support for that, then we've got to get organized. My plan would be: 1. Create a City Employee Task Force with cameras and note pads to go over the entire City lot by lot and block by block. 2. Review the City Ordinances to insure we have the legal tools to enforce the clean-up. 3.Identify everyone who has junked cars, trash or junk in their yards. 4. Send out a letter giving these people 30-60 days to clean-up their lot. The letter will outline specifically what needs to be done. I estimate between 300 and 400 separate properties will be identified. 5.Follow-up the process by checking each site after 45 days. 6. After the 60 days has expired, if progress has not been made, a citation will be issued. Next, 10 days will elapse and specific arrangements made to correct the violations by the property owner or 7. Prosecution will begin and a court order sought to insure clean-up compliance begins. 8. If action still isn't taken, the City will hire a clean-up crew, keep tract of the costs and assess the costs back against the property. I think we have to make people realize that the City is serious about cleaning up Mound. In the past, efforts have been initiated but follow through has been weak. I propose we try harder this time. From the Council's standpoint, this effort could have both good and bad points. The good is a clean town, which is a good All American reason to fight for. Bad because alot of people are going to be gone after in this effort and they probably won't be very happy. How would the Council like to approach this? May 19, 1982 CITY of MOUND 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (,612) 472-1155 TO: FROM: SUBJECT: CITY COUNCIL JON ELAM, CITY MANAGER GRAVEL IN THE STREETS One of our most difficult problems in keeping the streets and catch basins clean is sweeping up all the rock and gravel (that flows out of peoples driveways) before it gets to the storm sewers. There are a number of driveways where this runoff is really excessive (and we are constantly pressured to replace the gravel). What people need to do is hard surface from 5 to 10 feet back of their drive to keep the gravel beyond the gutter section of the street. I would like to propose we develop a City Ordinance of some sort to combat this problem and have people given up to three years to fix their driveways accordingly. It just doesn't seem fair that those who have hard surface driveways should have to pay extra for those who won't or don't or that we have to constantly use our already thin street crews to pick up a mess that could be avoided. JE:fc CITY of MOUND May 19, 1982 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 TO: FROM: CITY COUNCIL JON ELAM, CITY MANAGER Enclosed is the application for the renewal of the Wine License for A1 & Alma's and we also need to grant permission for their set-up permit. A resolution to approve this is in order. JE:fc STATE OF' ~'~.~F_..SC~A COJNTY OF HSNNEP]]~ ON SALE WI]~E LICENSE Part I Municipality of City of Mound TO THE MOUND CITY CCUNCIL: Pursuant to the laws of the State of Minnesota, Chapter 1127 of the 1969 Session and Chapter 11 of the l~ound Code of Ordinances (check one) A natural person .... (Fill out the sections ~ A partnership of Part II which are / A corporation applicable) hereby applies for an On-Sale Wine License for the term of (J)7~ M/~ from the /3__~ day ofai2 o~cC~um 19 ~, to sell intoxicating~liquors as.defined by law at retail only f ptlon "ON THE PR]!2~ISES "described as follows: ·" LEfAL DESCRIPTION Subdivision Block..,~/ ,, Lots ' II. III. (a) Attach a plot plan, drawn to scale, showing dimensions, locations of buildings, street access, parking facilities and locations of and dis- tances to the nearest church building and school grounds. Parking re- quired (see addenda). LOCATIQ~ Location ~nd Floor Number if other than ground floor (c) Attach floor plan, drawn to scale, showing dining room, or dinin9 rooms, which shall be open to the public, and indicate the number of persons intended to be served in each room. (a) (b) PERMITS Is Federal Permit required ~9 - Is State Permit or other permits required (1) If the answer to above is "yes,'! please~ (a) Identify required permit (b) Has permit(s) been issued If so, give number or other identification of permit (c) The name under which the permit(s) was issued (Additional information may be submitted on separate page marked, "Addendum to Item 3 - other permits.") Pert Page F/H ANCIAL INTEREST List the names and addresses of all persons, other than the applicant, who have any ~inancial interest in the business, buildings, premises, fixtures, furniture stock in trade; the nature of such interest, amount thereof, terms for payment or other reimbursement. This shall include, but not be limited to, any le.sses, lessors, mortgagees, mortgagors, lendors, lien hoiders, trustees, trustors and persons who 'have co-signednnotes or othe~ise loaned~ pledged, or extended security for any indebtedness of the applicant. Name and Address Type of Interest VI. (If more space is required, use separate page marked, "Addendum to Item 11;2 Financial Interest.") REFERENCES List the names, residences and business addresses of three persons, residents bf the State of Minnesota, of good moral character, not related to the appli- cant or financially interested in the premises or business, who may be re- ferred to as the applicant's character or in the case where information is required of a manager~ the manager's character. 1. Name & Address Res idence Bus iness /70 ~ ~~,~-,-,-'- ~ ' Zip Zip Zip Zip Address I ~-/~'~ " Zip Zip ' TAXES AND SPBCIAL A~SESSMENTS Are all real estate taxes, personal property taxes, and special.assessments on the premises paid O]Z~ . . '. (1) If the answer to ab6ve is "No," show: (a) The years delinquent and amount for each year as of (Date) Years Amount · Part Page VII. TYPE OF APPLICATICI~ 1. Is this application for a new license 2. Is this application for a renewal ~ 3- Is this application for e transfer 4. Are premises planned under construction other 5. %'~enever the application for an "on sale" license, or for a transfer thereof, is for premises either planned or under construction or under- going substantial alteration, the application shall be accompanied by a set of preliminary plans showing the design of the proposed premises to be licensed. If the plans or design are on file with the City Engineer no such plans need to be filled with the City Clerk. ACCOUNTANT,S STATemeNT At the earliest practicable time after application is made for the rene%ml of an "on sale" license, and in any event prior to the time that the appli- cation is approved by the Council, the appli.cant shall file with the City Clerk a statement made by a certified public accountant that shows the total gross sales and the total food sales of the restaurant for the 12 month per- iod immediately preceding the date for filing renewal application. Attach statement marked, "Addendum to Item VIII, Accountant's Statement." FEES Attached hereto is Check No: in the amount of representing the annual fee for the "On Sale" license plus $100.00 to be used as an investigation fee. Note: If the expenses of the'investigation relating to any application exceed the minimum investigating .fee, the City shall notify the applicant of this fact and shall require the applicant to pay an additional investigating fee which the City Manager deems necessary to cc~plete its investigation of the applicant. The applicant shall pay such an additional investigating fee w/thing five (5) days of being so notified. If such additional investigation fee is not p~id within such 5- day period the City shall discontinue consideration of this application. BOND A surety bond of $2,000 is .required conditioned as follows: (a) The licensee shall obey the law relating to the licensed business. (b) That the licensee will pay to the City when due all taxes, license fees, ~enalties, and other charges provided'by law. (c) That in the event of violation of an~ law relating to thebusiness for which the license has been granted for the sale of liquor, the bond shall be forfeited to the City. (d) All such bonds shall provide that no cancellation for any cause can be made either by the bonding company or the applicant, without said per- son first giving 30 days written notice to the City, addressed to the City Manager, of intention to cancel the bond. (e)' Be subject to the approval of the City Attorney as to form and execution. (f) The surety shall be surety company licensed to do business in the State of Minnesota. 1. Name of Surety Company. 2. Date of Bond Termination The bond must be deposited with the City Clerk after license is issued. INSURANCE l'Fnat liability insurance limits will be cart ed as provided in 14innesota Statutes 340.95 2. Address of Insurance Company Is a copy of the policy attached Page The applicant, hereby represent and state ~ .: That said applicant ~(~ citizen, of the United States, over twenty-one years of age, . o~ good moral character and repute,, not,' since the enactment of the ac~ above specified, been convicted of any uilful viola'- tion of any law o£ the United States,'or of the State of Minnesota, or Of any local ordinance, with regard to the manufacture, sale, distribution, or possession for distrlbu~iop or sale, of intoxicating liquors, and that no license issued to . under said act has ever been revoked: That no manufacturer or wholesaler will own or control, or has any financial in- terest in, the. business of selling intoxicating liquors at retail on said premisas, nor power to exact dr require~ by contrac~ understanding or otherwis% said appli- cant to handle or aell only the products of such manufacturer or whol9saler~ That no other retailer's license has been issued, directly or indirectly, to said a~plicant.. .or for said pre~ises;.that no license of a class other than hereby applied for has been issued to any person et said premises; and that said pre~ises are neither o~ned or controlled by any parson to whom no license could be issued: That said prauises are not within any area within which the sale of intoxicating liquors is prohibited by the laws of the State of Minnesota~ the'provisions o£ any charter, ordinance or special law, or through zoning ordinances, proceeding or legal process'regularly held for that purpose: That said applicant hereby agree that any license granted pursuant hereto shall be non-transferable without consent of the authority issuing the same; that said license shall not be effective until a permit shall be issued under the laws of the U~dted States in case such permit is required under said laws: and that will keep said license posted in a conspicuous place in said pre- mises: That this application is made pursuant and sUb3ect to all the la~m of Minnesota, the laws of the United States, the ordinances and regulations of said municipality end the regulatlons of the Liquor Control Co~ission of Minnesota, relating to the sale and places of sale of intoxicating liquors, ell of which are hereby made a part hereof, and which ~-~.~ hereby agree . ~o observe, and obey. Witness (s E~ L) Subscribed and S~orn to before He this day of 19 CITY OY MOUND Hound, Minnesota PUBLIC DANCE PERMIT APPLICATION Sire et City Sta~e (3) Does anyone other tb~n above h~-Ve financial interest i_u the business? (4) Location oi' Dances ~t/,J ~. ~,k'~-~ ~.~,P~,. , Zip (5) Dates of Single I~ances (6) If Arauual D:~nce Permit: From when to when (7) Fee: Single D~nce - ~10.00 per day Annual - $100 Please waive fee. Applican~ %/ *If the answer to Item 5 is "Yes," please list others having a financial interest in the business belmz, gix~ing name, address and telephone number. CITY OF MOUND' Mound, Minnesota TO: FROM: DATE: SUBJECT: Jon Elam, City Manager Licensing Department May 20, 1982 Miscellaneous Licenses The operation of the Tonka Toys Restaurant has changed management to Servomation Corporation, 7490 Central Ave. N. E., Fridley. The restaurant license for Tonka Toys Restaurant was approved April 27th. Servomation Corporation is applying for five.(5) cigarette machine licenses in additiOn. The previous management had'4 machines. The following are making.'application for additional Games of Skill licenses: Donnie's On the'Lake want 2 additional Games of Skill (April 27th the Council granted 3 - this makes total of 5) Mound Lanes made appJication for 8 additional' Games of Skill (April 27th the Council granted 6 - this makes a total of 14) Also Storecast Video Division want renewal of a Games of Skill at "No Frills" National Grocery, 5529 Shoreline Boulevard. Marj6rie Stutsman Licensing Department CITY of MOUND May 19, 1982 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 TO: FROM: CITY COUNCIL JON ELAM, CITY MANAGER Enclosed is a list of lots that I am proposing we reconvey to Hennepin County for private auction. In all cases they are sought by adjacent property owners. This will pretty well clean-up the backlog I found with tax forfeiture lots. JE:fc enc. LOTS TO BE RECONVEYED TO STATE OF MINNESOTA FOR PRIVATE SALE (16 LOTS) I. Lot 8, Block 6, DEVON 2. Lot 1, Block 2, HALSTEAD VIEW Lot 4, Block l, HALSTEAD VIEW Lot 3, Block 1, HALSTEAD VIEW 3. Lot 44, Block 3, A. L. CROCKERS FIRST DIVISION 4. Lot 27, 23, KOEHLERS SECOND ADDITION 5. Lot 17, Block 7, SHADYWOOD POINT 6. Lot, 12, Block 19, WHIPPLE ADDITION 7. Lot 7, AUDITOR'S SUBDIVISION 168 8. Lot 13, Block 14, ARDEN 9. Lot 38, SUBDIVISION OF LOTS 1 & 32 SKARPS & LINDQUISTS RAVENSWOOD IO. Lots 11 & 22, Block 13, WYCHWOOD ll. Lot 10, Block 7, ARDEN 12. Lot 6, Block ll, DEVON 13. Block 16, MOUND TERRACE Lot - Block 16 - Plat 61890, Parcel 9700 ~?oI .! o 0 ill , 012~ tERN ~: LANE CEDAR ; LANE · LANE t i I COTTONWOOD LANE I i lTZ.,~ LANGDON · LANE: 6? 5~ \ .cp....: '...'; c.~ · ~ 3A0~9 ~ :: O NOA~IO ~o --I 6blt ON 'S'q'~l ~N~ 9\, X3S3qOOl~ ~; oE £'$/I ]©7! X3SS':I 0 MIDDLESEX' ",LANE :7.$ NO. 1150' BRIGHTON Z ti> z -.( ::=:~ z == L g ~. ~ ~" ~. ". i i CITY of MOUND 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612} 472-1155 TO: FROM: DATE: SUBJECT: Jon Elam, City Manager Park Director May 7, 1982 Refunds - Prepayment for Wood Chipping The following people have refunds coming from the City because of prepayment for wood chipping: Brent Miller, 4524 Tuxedo Boulevard $30.00 John Richard, 3037 Highland Boulevard 30.00 Vern Christianson, 3098 Shoreline 30.00 Byron Petersen, 3100 Highland Boulevard 30.00 Chris'Boll is CB/ms /o?g HENNEPIN OFFICE OF PLANNING & DEVELOPMENT C-2353 Government Center Minneapolis, Minnesota 55487 (612) 348-6418 May 5, 1982 Mr. Jonn Elam City of Mound 5341Maywood Road Mound. MN 55364 Dear Jonn: To complete development of the Year VIII Urban Hennepin County Statement of Projected Use of Community Development Block Grant funds~ it is requested that the Mound'City Council enact the accompanying resolution authorizing inclusion of the following, activities in the Statement of Projected Use of Funds by June 1, 1982, if possible: 1. Downtown Commercial Building Renab Design 2. Low Interest Commercial Rehabilitation Loans 3. Housing Rehabilitation 4. Special Assessment Grants 5. Elderly Housing Development 6. Administration $ 5.000 $40,OO0 $20,000 $10,000 $10,000 $ 4;890 It is also requested that, if you nave not already done so, you please V/ provide this office witn an affidavit of publication for the CD public nearing and a copy of the public nearing minutes. If you nave any questions please contact me at 348-5859. Sincerely, ~ Senior Planner lw HENNEPIN COUNTY an equal opportunity employer RESOLUTION NO. RESOLUTION AUTHORIZING THE SUBMISSION OF COMMUNITY DEVELOPMENT ACTIVITIES FOR THE CITY OF MOUND TO HENNEPIN COUNTY FOR CONSIDERATION AS PART OF THE YEAR VIII URBAN HENNEPIN COUNTY COMMUNITY DEVELOPMENT BLOCK GRANT APPLICATION IN ACCORDANCE WITH THE HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1974, AS AMENDED WHEREAS, the City of Mound has executed a cooperative agreement with Hennepin County agreeing to participate in the Urban Hennepin County Community Bloc~ Grant Program, and WHEREAS, community development activities are proposed consistent with the Urban Hennepin County Statement of Objectives and Community Development Program regulations, and WHEREAS, the development of these activities include citizen involvement. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF MOUND, MINNESOTA: That the City Council of the City of Mound approved the proposed Community Development activities and authorizes the submittal of the appropriate documents to Hennepin County for consideration as a part of the Year VIII Urban Hennepin County Community Development Block Grant Application. INTEROFFICE MEMO TO: FROM: SUBJECT: Jon Elam, City~mager Bruce Wold - Chief of Police Three Points Blvd. Signing DATE ~I~¥ 14 ~ F~st of the "No Parking Anytime" signs on Three Points Blvd. were erected without the enactment of a council resolution. The only resolution which regulates parking on Three Points Blvd. is found in section 46.29 b (10) which prohibits parking from Finch to Heron Lanes. We talked about allowing limited parking between Eagle and Finch Lanes. The idea was to allow some parking across from the Three Points Tavern, but still allow sufficient visibility of eastbound traffic for persons attempting to enter Three Points Blvd. from Finch Lane. I checked the lines of sight at that intersection and found that the parking area would be so limited that the difference in signing would lead to confusion for motorists. I recommend that the whole block be signed "No Parking Anytime." Those signs erected on Three Points Blvd. are erected.as follows: "No Parking Anytime" north side of Thre~ Points Blvd. from from Commerce Blvd. to Resthaven Lane. "No Parking Anytime" south side of Three Points Blvd. from Commerce Blvd. to Eagle Lane. I would recommend that section 46.29 b (10) be changed to read: Both sides of Three Points Blvd. from Commerce Blvd. to Gull Lane, and on the north side of Three Points Blvd. from Gull Lane to Resthaven Lane. New signing needed to conform with this change will be sufficient signs to identify the "No Parking Anytime" zone from Eagle Lane to Gull Lane on the south side of Three Points Blvd. INTEROFFICE MEMO FROM: SUBJECT: Jon Elam - City Manager Bruce Wold - Chief of Police Crosswalks DATE ,,, May ,14. 19~_ Brad Larson told me that Hennepin County will install and sign a crosswalk on the north side of Three Points Blvd. at Commerce Blvd. He wasn't sure how soon the County would get to it. However, because of manpower cutbacks, the County would not stripe crosswalks on Shoreline even if Mound paid for the service. I don't understand why it can't be done the same day they do Three Points. biaybe you can throw some weight around and get them to do it. Good luck. Io o INTEROFFICE MEMO TO: FROM: SUBJECT: Jori Elam - City ~lanager Bruce Wold - Chief of Police Street Signs DATE May 14, Jon, this is to infom you of some areas where street signs are either emproperly placed or haven't been installed to conform with ordinances. Shorewood Lane - I believe both you and I have received complaints about trailer parking. Should be signed according to resolution. ~bund Bank - Drive-in entrance to the bank is a municipal parking lot. They are requesting signing to keep traffic from exiting onto Commerce at that driveway. I recommended to Bob Shanley that .a red and white do not enter sign be installed on one of the posts at the outboard drive-up station. I also recommend that "DO NOT ENTE~' be painted on the pavement. May 17, 1982 CITY of MOUND 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 TO: BRUCE WOLD FROM: JON ELAM Holly Lovseth of.1656 Bluebird Lane wants her section of Bluebird posted for "No Parking" on either side of the street. I have a problem posting streets like this because: 1. People paid for extra width streets so they could park. 2. I think it's near the Commons and a ploy to try to keep people away from their docks. 3. I want to keep the area as open as possible for public use. Let me know your thoughts, since she does seem insistant on getting on a future Council Agenda. To: Jon Elam From: Bruce Wold Jon, I looked at Bluebird Ln. after the receipt of you memo. I can see no reason for zoning the whole street "no parking". There is no unusual topography or other factors which would require the change,.of the parking zones. I believe I have had one telephone conversation with Ms. Lovseth in the past. The problem that she was having at the time, was the parking of cars at the Broberg residence across the street. In the past, the Mound Police Department has responded to complaints from residents about the parking problems there, and has initiated action in this area without complaint of residents. Mr. Broberg has a great number of local young persons who frequent his house. When they do, they park their cars in the dead end and on the wrong side of the street. We handle these problems as soon as they are phoned in or when one of the patrol officers spots a violation. I will put a notice in our daily bulletin to again alert the officers to the problem. We have had no complaints in that area during the winter months. BILLS ...... MAY 25, 1982 Applebaums All Star Electric II II II Jan Bertrand Badger Meter Burlington Northern Bo~anan Barnes II II Badger Meter Chapin Publishing Commissioner of Revenue Century Camera Coast to Coast Continental Telephone Bill Clark Standard Gary Cayo Dixco Engraving Empire Crown Auto John Ewald Fi remen's Conference Exp. First Bank Mpis Ganzel Signs Gerrys Plumbing (HUD) Henri Co. (½ R.E. tax) Eugene Hickok Hayden Murphy Henn Co. Treas Henn Co. Chf Police PTAC Henn ¢o. Sheriffs Dept Illies & Sons Internatl Assn Fire Chiefs Kromer Co. Koehnens Standard Ken & Norms Cabinets I. OG IS lehn Electric Lutz Tree Service Wm Mueller & Sons McCombs-Knutso~ Metro Waste C6ntrol City of Minnetrista MacQueen Equip Minnegasco Mou nd Hdwe Mound Super Valu MS Print, Inc. Martins Navarre 66 Mpls Star & Trib City of Mound Mound Postmaster 11.94 84.43 343.28 25.40 40.41 533.33 125.06 93.03 20.98 45.O3 3.OO 137.50 63.82 1,211.53 2,716.83 4.5O 3.25 29.95 4.OO 1,645.OO 20.00 lo6.27 678.50 32,169.64 8O.OO 211.O0 1,950. OO 6O.OO 5.7O 195.oo 6O.OO 45.75 12.33 75.OO 1,260.92 164.50 565.OO 1,111.70 9,724.00 i9,277.27 136.OO 87.79 3.0o 7.83 65.18 73.O5 30.25 8O.OO 45.33 100.OO Lorraine Manson Modern Express Macqueen Equip City of Mound NSP Nemadji Tile John Nafus Navarre Hdwe NSP NW Bell Tele Old Dominion Brush Pitney Bowes Credit Charles Pearson Brad Roy Reo Raj Kennels Sterne Electric Sun Newspaper Spring Park Car Wash Ted Stallman Thrifty Snyder Drug Towns Edge Ford Thurk Bros. Chev Village Printers Van Waters & Rogers Unitog Water Products Westonka Sewer & Water R.L. Youngdahl & Asso¢ Xerox Ziegler, Inc. F.H. Bathke Blackowiak & Son State Treas Skyview Design (HUD) State of MN Documents Mike Savage Wood N Nail (HUD) WoodChipping Refunds The Liquor House Griggs, Cooper Johnson Bros. Liq. MN Distillers Old Peoria Ed Phillips TOTAL BILLS 44.00 23.50 3,OOO.OO 85.44 7,294.42 1,071.45 90. OO 55.61 716.19 60.30 54O.OO 26.00 14.52 6O.OO 215.00 103.98 84.00 109.30 12.00 93.14 1,824.65 76.00 286.25 1,075.65 336.30 234.80 153.50 6,248.50 573.40 573.29 13.80 56.o0 ]5.oo 2,090.00 14.75 90.OO 4,434.00 12o.00 348.24 3,509.62 4,663.49 1,132.9o 1,194.59 1,495.32 119,8o2.18 WASHINGTON, D.C. 20510 May q, 1982 Mr. Jon E]am City Manager City of Mound 53ql Maywood Road Mound, Minnesota 5536q Dear Jon: Knowing of your concern about IRS Ruling 81-58 dealing with the tax status of police and fire relief associations, I just wanted to make sure you've heard the good news. Our dispute with the IRS was resolved in favor of the Minnesota police and fire relief associations. I am happy that I and the other members of the Minnesota Congressional Delegation were successful in protecting our state's as so ciat ions. I'm glad, at least in this case, the news is' good. I hope you'll continue to write me with your concerns during what promises to be a very busy session in Congress. i~av e ~ Dur enb er ger United Stat es Senator DD/bjw Minnesota Pollution Control Agency ~-~. Mioha~l Peter Reese 5241 Ma2~ood~ Road Mound, Minnesota 55364 It is a pleasure to inform you that you have passed the written examination for wastewater facility operator, Class You will be certified, and receive your certificate, upon receipt of the $15.00 certification fee and a copy of this letter, subject to approval by the Water SupplY and Wastewater Treatment Operators Certification Council. Please note that the $15.00 previously submitted was for the examination only. The certification fee, made payable to the State Treasurer, should be mailed to: Supervisor, Operations Unit. Facilities Section Division of Water Quality Minnesota Pollution Control Agency 1935 West County Road B-2 Roseville, Minnesota 55113 You are to be commended for the interest that you have shown and the effort made to meet the requirements for certification. Sincerely, Original Si§n~°d Ey W. N. Sexa.~i~r Willard N. Sexauer, Supervisor Operations/Training Unit Facilities Section Division of Water Quality cc: Jouathan '.~. E!a~:~ City ii',,'~nager WNS :ea Phone: 296-7258 1935 West County Road B2, Roseville, Minnesota 55113-2785 Regional Offices ,, Duluth/Brainerd/Detroi! Lakes/Marshall'Rochester Equal Opportunity Employer 5101 parkdale drive~ st. louis park, minhesota 5541 telephone 546-2334 March 23, 1982 Mr. Leighton Lindlan, Mayor 5341 Maywood Road Mound, MN 55364 Dear Mr. Lindlan: We want to touch bases with you again for assurance that continue to provide nursing services to the residents of your community. The annual statistics for 1981 have just been received. That which relates specifically to Mound has been ab- stracted so that we might share it with you. We invite your call if you have any questions about the fol- lowing report or if you would like to know more about Suburban Public Health Nursing Service. Sincerely, cc: Jon Elam, Manager (Miss) Hilda Boyle~ R.N. Leonard Kopp, Consultant Executive Director No. of home visits: nursing care - 364 home health aide - 136 health promotion - 145 physical therapy - 10 nutrition consultation- - total No. persons seen in home - No. immunizations given - No. attended senior health screening clinics - No. attended group sessions (parent/child; wellness; caretakers)- 655 104 111 28 _- , ~upported by tax funds from municipalities of suburban henne~in county & the united way CITY of MOUND May 19, 1982 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 TO: CITY COUNCIL FROM: CITY MANAGER Enclosed is a report on a presentation made by one of my professors from last year. I thought it said some pretty creditable things, especially as it applies to Mound. I urge you to read it. JE:fc Council ot North Central Gov~nom Governor William G. Milliken Michigan Govenor Afber~ H. Quie Minnesota .~ovenof Lee Sherman Dreyfus wisconsin April 1, 1982 Mr. Robert Eaton Harper, Eaton, Oswald, Peterson and Overom 515 Providence Building Duluth, MN 55803 Dear Bob: ROUTING Admin. ! ~ P.R. ~/ ~ H.R. CSIPIO APR- 2,1 1982. ~or your inlormation Take appropriate action Flease. repIy Prepare reply for Chmn sig , Enclosed is a transcript of the presentation made by Dr. David L.. Birch .to the Council of North Central Governors during a Symposium on Small Business which was held in Green Bay on March 4-5, 1~82. Dr. Birch heads the Program on Neighborhood and Regional Chang~ at the Massachusetts Institute of Technology and is recognized as a foremost analyst of the role of small business in the jobs treat!on process. His speech was based on extensive research commissioned by the Council to determine the forces and condi~lons that have affected the North Central Sta~es' economies in the past decade. ' Also included is a copy of the proceedings from a provocative discussion between Dr. Birch, Governors Lee Dreyfus, Albert Quie, and Michigan's Lieutenant Governor James BrickIey. This wide- ranging conversation covered a series of topics on the future structure of the economy in the three states. I hope [ha~ you will find [his material to be of interest. S inc_.ere I y, ~ ~PH' A. RIC: Symposium Ccordina~or enclosure Presentation of Or. David L. Birch Council of Upper Great Lakes Governors De,t.J..ve,~d~ Ma~cA 5, ~98~ Gr~.~n B~y, Wisconsin I' would ltke to "unpeel an on[on" today in the sense o~ sl-~zrting with a fad_fly broad view of what's been going on in the structur~ of the U.S. econ- omy over the past few years, and then take ~ scmewhmt broad brush over the tri-state econcmy on & state-by-state tmsis and then take a very micro view of what's going on in the econcutie~ of Wisconsin, Michigan and Minn~ot~. We began our reseamch effort with the. question of' how ~e are going ~o gener- ate the 15 million new jobs we need in the next t~u ~o eleven yem_rs in the U.S. econcmy. We went about it slightly differently than most peoDle in the se~e that I decided to find, out what the individual pieces wer~ doin~ r~the~ than the whole. So we built up ~ file ~f 5.8 million individual business establishments, s.round 80 percent of all.the busines.~ a~clresses-in the United Stgt~s. For e~ establishment, we looked at its history frcm 1969 to 1980. · We c~n trace the history of what's goin~ on mt e~ch adc~__. Needless to say, yo~ don't do this by .hand, so we developed some ccn~er softw~r~ Oo very efficiently analyze these d~ta and then we beg~n looking mt the struc- ture of the econcmy frcm the ground up--sort of ~ busines~-by-business, plage-by-pl~ce. I think i~'s:helpful to start thinking of m plmce'like Green Bay as ~. ~th- tub where the level of jobs in the' tub is & function of the ~!ance bet%veen six flows going in ~nd out. On the outside you h~ve firms either dying or contragting, l&ying off people or moving out; and on the inside you h~ve. firms being started or existin~ firms expanding or firms moving in. The first thing we found by studying our 5.8 million businesses was that the ~vement of firms, in the sense of hiring ~ moving v~n and c~n~ then~ from one place to another is vtr~,-]ly ueg=ligible. Very few Jobs are lost or g~ined by any state as · consequence of firms moving. The second thing we found, m~d the most striking frcm m~ point of view, is that the losses everywhere in the country are about the same. Every place in the country loses about 8 percent of its ~obs ~nd s.round 8 percent to 10 percent of its businesses every year. Thmt m~y not se~n like much ~o you until you realize that every five yea~s every place ia the country has to replace about 50 percent of its Job ~se. There is tx~nendous churning in the system. Furthermore, the more active and dynamic and r~pidly growing m plage, the gI~=.~ter this is true. On m percent_age %msi~, Houston loses its job l~_se, and h~s more plant closings than Boston or Buffmlo o~ Green B~y. The more dynamic the econcmy, the gre~ter the los~ is out the bottcm of the tub. This is important because it means' there is a tremendous opportunity for trmnsforming the econcmy, given the rate mt which we h~ve to replace it. If we replace it %rith things that ~ different from the ~hings that are ther~ is & good chmnce that .~e're going to change i~ ~absta.utially and that's just what's going on. So, i~'s very impor~ant to find out who ~he job replacers are. Who's filling the g~p th~'s left by the ~ per~en~ per y ~emr that are lost? One of the things we've found (and I'm sure ~&t'$ one of ~he reasons nha~ I'm here t0d~y for this p~icular symposium) is the great m~jority of those 3ohs are replaced by stiller rather ~ha~l b~sin~es. We've found rJ~u~t scn~e~hi[~ like two-thirds of the'replacaq~nt 3ohs in the period we've studied frc~ 1969-76 s_re created by firn~ with 20 or f~wer employees. About 80 percent are created by firms ~ri~k 100 oF fewer ees. We fok~d Plat yOU~ firms cregte most of the new ~ohs. We've found ~hat est~blishments less than four yeasts old cre~ted scmethin$ like 80 per- cent of the replag~ent 30bs. -'Ye found that the 3ob replacers are very vol- &tile. This is what I refer to as the "bankers ni,~ohtma/'e.'' It se~ns to be true that the single best predictor of the future growth of & company, par- ticul&rly & ~-T~ll ccrapany, is past decline, The single best predictor of d,.~cl[ne is previous growtJ~, and the $in~le.b~..;t pr+.~Jictor of ,lc~tth t~ stability. The .businesses that are'interacting with the world have m much greater' chance of .%-urvivin~ than businesses that m stable and are not responding %0 the world s~out then, We also found that the over,belching creators of new 3ohs &re in the service sector and not in manttf&cturing. Of' the Lq m/llio~ ~obs created in the 1970's, only 5 percent of those wer~ in manufacturing. Only 11 percent were goods productioa as & whole--mm_nufzc turing, mining, forestry, fishing, construction, agricul~anyone who remakes anyrJuing of any .%orr or produces a~ythin~ of a~y sort. Eighty-nine percent of the newly cre~ted 3obs ~ere in the so-called service sector,. Th~.t~..trend has been going on long enough now so rJ~t only about ~.% percent of the America~ work force is agtumlly enggged in manufacturing operr~tioas of any kind. We aren't 3ust .~o~t of ~rmdually going ouc of the' ma~uf~cturin~ business, w~'re out of Lt for all inten~s a~ld'pur~x~gr~s ~s of 19Bl. Any lathes left in Americ~ should be. O.nT~diately re£urbish~ so that they'll be appropri&te for the Smithsonian. The older the city in the U~ited Stat~ and. ~he more northern the city in U~e United Stoical, the n~'~'., this %s ,~). Other people have now looked at different dgt~, looked ~t different countries. It is a very consistent pattern tllrough Europe, the United States and North America. If you add up the pieces of this thing, I think it amounts to & bo-~ic restructuring of the econcray. Its & shift nominally referred to as fron man- · ufacturin~ to services. But I don'~ think ~hat's really ~he ch~n~e that's ¢oing on. I think it's ~ shift away f_rcm things that pequire muscl~ and dexterity and into r31inEs that r~q~re thinking. It's ~ shift frown ha_~d-~a_re to thoughtware. It's the thinking content of the business that determines whether or not it will flourish here or not. It's a shift fron latimer to smaller, scale enterprises. The bsg-riers to entry in the thought~re sector are substantially lower than they ~ in the m.~nufacturing sector. ~y f~vor- ire example is th~= there are two eleven-year old kids out in California that recently sta~%ed up a ccraputer sofTmare ccmpany. They h~ve since mmrket~ 5heir first produc= very successfully n~ionwide--n very sophisticgted file har~ling system. They are about to introduce their second nationwide product and they're bocalin~, sort of working in thc~[r bedrooms wi~n Uhelr p=rents consent a~ eleven year~ old. 2 Y~)~ c,~,:l,l enter the c~mputet- .~ft~re l~.s(ness with a er~Lt ~ ~d m~ John l)eb)re~n ~ lo, md ~ut ~ t~tu~ppLty,, you c~nnot entec the ~mt~bLte industry witI~ ,~ cr~Lt ~rd. ~ts ~ sh~ft fr~ physi'~ ~mpttz~ ~ h~n ~pit~. ment ~ we ~ [n ~u~t[on. ~e. ave~e f~ily w~th two ~ple ~l~ :bly %nv~ ~r~ in theLr chil~-en's ~u~t[oa ~ they %~11 [n theLr H[~her ~u~tion [s ~nE one of the ~jor inves~n~ we ~e ~ n~ion. ~hly 50 ~ent of o~ yo~ ~ple now So on to college fo~. ~is [s · ~jor inv~n~ which is nsver ~~ on ~e side of ~he ~ ~d ~ly. ~~ on ~ ~vinEs sid~ of the ~. We l~k relative ~ ~e ,I~n~ ~ ~ do%n~ very little ~vin~. In f~ ~e're investinB i~ [n %~e ~re ex~rtencinE · s~f'~ f~ ~ inde~ndent ~ ~ inte~e~nden~ ~on~ny. Wu ~ now l~in~ ~ l~e not ~rte~ of ~nuf~ctu~ ~s ~d ne~ ex~rter of ~%ces, ~d ~ch less of ~ island [n the co~ of eve~. We n~ exert ~ut ~0 bill%on ~h of ~ices ~ ye~ ~ ~ ~tion. %~e're tll~ ~%~l~ ~t~t ex~ter of ~%ces in the ~rld ~d.we exert 20 of the entire ~rld's ~ice ~e. ~ ex~r~ of sel~ices ~re n~ ~ble ~ our exerts of f~. We ~ve · ~sLtive uet ~l~nce of a~r~ su~lces n~ of ~ut ~5 billton a year. ~%e~nwhlle, ~ ~r~ the net bn~rter of ~nufmct%~ g~s o~ U%e ~ aleut $~5 billion ~ yemr o~% current ~c~nt. ~n~ this'p~e~, ~nd ex~r~-~ ~ ~rcen~e of ~ ~on~y l~ve doubl~ %n ~rce,l~e since 1955 or ~, mhd in ~lute.te~, they're huEe. ~ ~r~ exerts ~ve sk~ke~ in c~rent doll~ te~. ~e questioa ~ h~ve ~k ~u~ ~[s Ls r~%n ~ af~ocd it? I doa't thi~ we ~n mffo~ no~ it. I'll refec ~ New Englznd ~ m g~ e~ple. New ~lm~ ~ off a lon~ t~ ~o ~ m lost ~use. In fmc~ one ~tty ~ onc~ ~id th~ if ~e ~~ we~ settl~ fr~ West ~ ~t ~her tl~n ~t ~ New En~l~d wo~d ~ ~ 3~e ~tio~l ~k. I~ offe~ ~elo~ nm~l reso~ces ~d not ve~ much else. ~~ of t~s ~ hmve s~ft~ ve~ rmpidly out of het~ ~uf~turing ~d in~ ~ices ~d high-t~h. in New ~gl~d, in the ~ri~ t~t I s~di~ in ~emt de~il,' ~0,~ f~turin~ jobs. We ~in~ 1.1 ~llion ~ice jo~ ~d ~ few ,~re jobs. We' re ~[ng our ~owth ~m~ch ~re strongly o~1 ~1I b~[n~s t~st [ltr[~ of the co,try. We p~[d · ve~ h~vy pr[ce for this itl t~e mid- t970s. ~ ~lo~ng r~te ~ up ~o~ 12 ~rceag ia ~he t97~75 We l~k~ like ~ ~n~ ~ goner, but (n ~e p~e~ of go[n~ tl~ough shL~t, ~'ve ~ ve~ much stager now, ~d the ~ea~ ~plos~n~ s~tistics ~11 ~ strikingly different ~le. ~hus~tgs is now ~ond only .~ Tex~ (n ~v%ng ~e lowa~t ~plo~nt rote (n the co, try. We sukst~nti~tlF ~e~ of ~liforniz ~nd Flor~d~ in ~e~ of the ~igh~n~s ~d l~e~l~h of ~ ~onmy. New York ~d New Je~y m only slightly ~hin~ t,~h~tZs ia ~ving m~e ~his shift. So just ~ Ne~ ~g!~nd, (n · ~n~, ~ the [nduszr(~l revolut(oa (n the early 18~s, ~'re n~ lem~%ng the though~ revolu~%on in the ~Os. ~.e~ ~e ~ve~l issues rel~ ~) ~his Am0n~ the issues facing us is that of job quality--are our jobs beccming lower paid. and less attractive than they were before? Another is~ae is job sr,~bility--sr~ll businesses tend to turn over and we don't h~ve the security and st!bil.ity we had before, There is the issue of corpor.~e stability--the. small business population ~urns over' at ~ much greater rmte than the larg=e one dces, There's the cc~petition wi%h Japan, And there is n~tion.~l aecu- rity in general, Of those, I am not very concerned about the. job quality, job stability, cor- porate stability ~nd cc~n~e~i~ion with Japan. I think in we will do a very good job in the future, and I'm le,ast,of all worried about the ccrmpetition with Japan. If I were in J&p~n's shoes I'd be very con- cerned. The n~tion~l security issue is the ma]or one, but i think ther~ a.re ways to get ~.round that. In generzl though, I think we' re headed in very much the rig,hr direction ~.~ & nation. We're bec. c~ning in essence the creativ- ity center of the ~orld. %Ye c~pitalize.well on our traditions of entrepre- neurship,i inventiveness and individ%u~lisra. Th~ bottom line is, is it working?. I'd say it's ~orking very hnpressively: We now h~ve'four to five ~nindred thousand people starting up new businesses every year aand the Cc~nne.rr.e Depmrtment reported with gre.~t di~y that w~ sLxr%ed up 600,000 this yemr and felt t~t it must be a defect in our st2t- tis ticml system because roll of a sudden in ~ recession we h~d all these s~all businesses .sta~. Well, that's precisely when smmll busine~?es s?~_r~c. It's an act of desperation, not mn act of wholescraeness in a~a~y cases. We now employ a gremter ~ercen~_a~e of our work force thau% ever before in history. We cre.~ted 19 million new Jobs in the lgst ~en yes.rs and I don't see anything short of ~ Thilxi World War stopping-that. So, in a world of pessLmists I'm very optimistic about the national picture. Now if I placed ~%e Upuer Gre~ Lakes State are~ in this context [ .see .same vecy .interesting things. First, it seems to m~ that all three of your states ~re going t~rough the saane shift that we a_re going through in New England, you' re just following ~long · little bit behind us. In f~ct, if y~ look ~t the trends in mmnufmcturing versus services in the three .state ~res_~, you g~[ned in the 1970-1980 ~ericd 9,000 manufactzuring jobs, .~ad 1,220,000 service sector' jobs. In the 1978-1981 period, you lost 138,000 manufmcturing jobs ,xnd groined 307,000 service jobs. You ~ already r~pidly COnverting your mix mt m rather substantiml r~te. : If you ccrnpmre the states in det~il, there a_re differences between them. In general, Wisconsin is right about on the U.S. ~ver~e, ~,{innesota looks %0 ~e doing much ketter and :~ichigan looks to he ccmin~ along more slowly. For example, in the U.S. ~=rcra 1970-1980 the emplo~nent ~ grew at)out 2~ percent, .%~[nne.~ot~ grew 36 percent, Wisconsin grew 29 percent and Michigan only grew !1 percent. Fur~he~re, in m~nufmcturin~=, .~innesot~ is growing above the ngtionml &ver~-ge. While 5 percent of our growth wa~ in manufactzurin~ n~-tion~lly,. 17 Dercent of .%(innesota's growth was in manuf~ct~uring. Wisconsin had ~ 9 perceng growth r~te ~nd ,~,tichi§an actually declined by 8 percent. Wiscons%n and Michigan )~ve ~ much gre~ter percentage of the l&bor force i~% manufmcturing th~n the national avera4~e. %{%nnesot~ is much below the a,~t[onal average. ,V~nnesot~ is obviously going [n m different cL%recgion tn tl~t negard. Su~.rficially it would appea~ ~%icl[[gnn is in the worst s[m~, Wi~o~in' ~ort of doing o.k., ~d M[~~ [s do(ng ve~ well. ~ I wo~'g extra.late t~t. In f~t, t f we ~ ~lt ~ch~t~s [n the ~ ~oup%ng think ~(chig~ is c~ging i~ ~x ve~ ~pidly ~d ob~o~ly ~ng ~ heavy pr%ce for it. ~chig~n l~t ~,~ mulcting 3ohs in the 1972~2 but g~in~ 456,~ ~lce jobs ia flxa~ ~ ~rt~. ~ ia ~e ~~ble ~978~2 ~ri~, ~{tch[g~'s lo~ 'of 135,~ ~uf~iag jo~ ~ off~ by t05,~ ne~ ~ice jo~ ~ the Mich[~ ~om~y. Michigan R~s the university _k-se to sustain that .service grovrth smd ~miver- sit[~ are very, very important. I wo~ld exDect to find [{ichig--~n in mu~h · same strong position that ~sachusetts is in today within the next five ei~=ht years. If I had money to invest at this point, I v~uld ~nvest ~g tn ~lich%g~n. If you put a microscope on~ this prix:ess, which we did by analyzing ever"/ ind%vidual business establishment ia .the thr~e s~tes, you get an even clearer picture of who's doing the. 3ob fo~ you. The first thing you d%spell is the notion that Michigan is .%-dffering heavier lo.~ses. Throu~..'%~% the period-we studied, h{innesot~ ha~ consistently hi~J%er %-russ loss~ centage terms. In other words,, the ~rDr~ a~tive and ~rowing and dynmnic ,.~oncmy the gre~ter its agtivity and the gre~ter its gross losses ou~ the. bottcm. .~J~chiga~ ~nd Houston l~ok very much the same in this reg,~rd. not ~ve bee~ true for the last year or so, but it certainly has bc~ true t}u~oughout the 1970's in general. If you look at vino is r~placing the losses, the micro d~ta strongly supporr~ the macro findings on ~e hnportance of high thought ~)ntent bustne.~..~s. deffnitlon of kigh-tech that's broader than the cc~n definition includes sc/ne of the high thought c~ntent services, a~ well as the high-tech m~nuf;~c- turing. It includes the medical labor~tories, the computer soft~.~re, r.ohotics F~)ple a.nd the missile folks. This high-tech segment in accounts for the overwhehning share of the net growth in the stem. And since we've looked at frequent intervals, it turns out it's p&rticdlarly inerrant to you in bad times. In the 197~--75 pericd the ice sector ccmes on strong in'response to slack periods in n~nufacturfnz. .It's m ~e&t countercyclical sector. This is p~rttculmrly true Ln :~li. chig~n. The stall.business group' in t.~ a very, very active ~roup. Job replacers in the three-state are~_ are .oce- dcrninmntly .%-a~ll ~nd there %s m very shmrp break at 20 employees. Don't me '~hy, but when a ccmpany gets more than 20 employees it dcesn' t m~ke difference whether it ha~ 21 or 500 or 1.,000. There (s ,% dramatic bre~k around 20. And I~ichig~n is particularly s~rong in this depctr~ng .~-~ '~'eil. ~ichfg~n cre~ted one amd one-hAlf jobs for every job th~-~ larger-si/~i n~.~.s cre, t~I, ccm[xmsating for a ,%2 ~e. rcent loss in all oilier si7~. ~t~.,~- gories. In f,~ct, mantff.~crurer~ wi[h 20 or fewer employe~s are still and l~xx~ing tn !,lichi~=an despite v~.mt scme of your larger, less ~ynmic in, J,tstrLes ~e doing. Thc~e businesses with over ,500 employc~ are consistently across ~e s~t~. lVisco~in ~rns out ~ have the least de~nden~ btu~i, ne~ ~ ~ ~urce of ~o~h. You ~[n ~ro~m(l 37 ~rcent of yo~ jobs stall business. ~~ is a~ut mver~e in thug r~d. Wisconsin low ~d ~ic~g~ is strongly ~gh. ~ere is a m jot exception the ~-t~h ~em. It's ~11 in ~rcen~e te~, but i~'s ~ng ~re im~r~t ~d ~t ~e ~ia it's q~ ~r~t. It ~ends l~er ~ies ~ ~ller on~ ~ich is co~is~ntly tru~ %men you look at ownership ~tterns there is ~ fairly consistent and dis~arb- lng p~ttern frc~ my point of view. It's a mixed bag in scroe respects but t~he expanding high-tech a.nd service sectors are increasingly controlled of-s~%te. Ia the high-tech industries in Wisconsin for the 1989-7°. period, none of the grow%h was controlled by-outside interests.. By the time you got 'go 1974-78 it ~ up to 37 percent out-of-state ownership. In the service industries, out-of-state ownership increased from 20 percent in the e~rlier p~ri~t to 54 Dercent in the later period. In ,V~innesot~% the high-tech went frc~n 40 percent to f~] percent ~nd the service sector went frcx~ 15 perce~ to 6l percent controlled from outside of the state. In %{ichioo~an, 'o%lt-of-s~te ownership of the high-tech ~ent frcm negative 4 percent, to a plus 85 percent by the time you reached the 197-a-76 pericd. However, ~{ichigan didn't experi- ence ~ny lnc~ in out-of-state control of i[~ service sector. I: stayed ~t m nice, comfortable 28 percent throughout the period. Again, distin~on~ish- lng Michig~ frc~n sc~ne of the other ~tmtes. This trend ~ re~ched ~he poin~ in Wisconsin ~nd ~innesot~ where only about one-third of the ~ch~ employment in the service sector is controlled within the state in which il~'s Iccp.zed. Only in ~lich'ig~n is that percentage above a half, ,~hich ~ugers well for ?~ichigan in the futu_r~. If you put all of these micro pieces ~x~ether, I see the three north central sr~xtes following, right dow~ the same path that New England followed d~n. There is a rapid shift out. of WOrk tl~t requires muscles and dexterity mhd into work t/nat requires brains. There is a ~x~rmllel shif~ into .=3n~ller entered'prises ms a source of growth, ~nd ~vh[le there u_re significant ferences betwe~.n the srxltes I think the similarities s. re much ~re~ter the differences. In particular, I see ~{ichi~an headin~ in the ri§hr dLrec- ti°n,'"i.~t least pulling even within the next five, six or ~ive~! years much ~.~%,gzhussetts h~s do~le on the n~tion&l scene. If [ would ur~=e you to worry about anything, [~ would not be how to fight off ~he demise of the l~_r%~e m~nuf~cturing plant. I'd worry about l~w to help the people hturt by that d~ntise, but I would not waste much time dream/ng aboug scraehow rimming l~ck the clock and reversin~ ~he trend. This trend i:g go[ag on pretty much everywhere in ,.the country now at about t3~e .~mame rate. 'And chat includes the Sun Belt. [ ~ra_s do~n in Little Rock, Arkgnsa.s recently and I ~hink t!~ey've been slipF~ a mickey. '~i!e they thou~h~ they were ste~lLn~ all these pl~n~.q frcra us, 5hey'Fe no~ havinE' ~ll the s~De experiences you .%re. They have indus~r[a! pr.ks which are only BO ~ercen~ occupied sta~e-kvide. They · h~_ve. ~nufac~urin~ employmen~ declinin=~ a~ a~x~ut the ~ r~%te your turkng ~nplo~n5 is decl[nino~. In f, ct, th~y find t'.%eYr ;,'an,~f;u:turm:~ ~r.:: ~oLng o~snore j~t a~ut ~ ~t ~ yo~ ~a~uf~c~ are. [ ,~ ~lkin~ ~ ~ll v~Ive ~nufact~er ~o ~kes ~ s~c[al &orr o~ e.x~t[c v~lvu you would )u~ve thought would ~u~ve been protected here forever. He's no~' .~our~:lng a~l of his ~rts ~d c~aents offshore ~d s~rp~y decre~sLn~ his nmplo~nt %n [~ittle R~k ~ving ~ust ex~nd~ %n the l~ fo~ or f~ve ye~r~. So, in fagt, it's not just you tInt's having this ~x~erience, it's [3elt a~ well, ~d I don't ~ t~t you ~ve very much chance of reve~ing that. I~te~ I'd ~ve you ~rry ~ lot ~ut ]~ to sup~rt the strong, ~owing ~n~ of the ~i-s~te ~on~y. I'd ~i~ m lot a~ut the n~s off the ~ller ~owl~ge ~ ~in~ses here. I'd ~rticul~rly ~rry higher ~uc~tio~ ~d ~vid~g ~ ve~ ~ll-~in~ lm~r force. ~owl~ge-~ ~on~y, b~ ~11 ~ o~ chief ~ce ~thout ~nd everything you ~n do ~ p~te t~t ~uld ~ by f~ the ~t ~r~nt. In f~t, I. ~uld ~k t~t ~ high t~t I '~uld only. ~lly ~)gher things t~t ~e on ~ mind. There is ~ lot of evidence the l~tioa d~isio~ of. ~r f'kve ~d m half .~11%o~ ~in~ ~mt they ~re l~t%ng %n plies ~th strong [nsti~tions of higher ~u~tioa. We studt~t l~tioa d~isio~ of the 5.5 ~llion b~inesses ve~ ~refully ~d I ~ould Ln []u~;Ln%, ,xnd not to dt, ni. nlsh the ~npha~ls on ~xtu~t[oa, :zlmut ~rking ~p%~l. ~1t b~qlnesses in gene~l have no ~ts, bun they have · gre~t n~t ~o~ ~rki. ng c~p[~l to fln~ce their ~co~l~ r~elv~ble :~nd ~ ~ able r~ 5~ ~)m~y ~ ~e ~.he[~ ~nts ~[le they're That's m very ~ute p~bl~ and a very ~rtmnt [~e. If you really to do m~th~ng ~ ~p ~, y~ might ~rry m~u~ providing cmn ~ very diff~cu~ ~ find ~n ~n? plmces ~d I wo~d ~e ?du m~ut t~G one. The hope of all of these challenges is to regain control of g~ovzth in these sectors that you are now in the process of losing. In short, to borrow m tgu':~-~.· from .the Gresen Bay Packers, I'd sDend my time worryin.g a lot more ~bout my offense and a lot less time worrying about my defense. Thank you. Pmr:.[c t Da_nra: I~)UN~ABLE OISCUS~ION Dr. David Birch Wisconsin Governor Lee. Sherman Dreyfus !,~innesota.Governor Albert Qui'e .%lichig~un Lieutenant Governor J,mes Brickley GOVEI{NOR ~ ~{FJlV~ L~S: Let ~ ~k you this. Wisco~in, ~ere ~ere is s~ill ~ ~er de~ndence on l~e ~nufacturin~ and le~ ~ the ~ller-si~ b~ine~es, is there ~y ~ibility t~ the la~e ~n~t~ing ~_~, ~e of cer~i~ s~l~ltz~tions, ~y yet plus for ~? I s~ly in~te t~t ~ere we ~re do~ in l~e [~ in the ~e~ of ~~ction ~~nt. For ex~ple, huge co~tructioa ~~ng [n this s~te ~ch ~s ~ning ~ui~n~ ~d hem~ f~ ~d ~icul~l ~~nt. ~e ind~tr[~ ~e do~ now but will not co~tructioa ~ r~ri~ ~k ~en the ~on~y c~s ~c~ DR. DAVID BIRCH: If you can ccmpete effectively tn tho,se industri~ then for heavens sake do it. I'm not one to advocate abandoning some of your strongest assets. I'm suggesting that you're not competing with other st~tes ~u~ymo~e, you' re ccraFeting in m ~orld econcmy, In northern England they a_re now maJcing heavy farming equi~nent at 'a great r~te. ~x~r is one t.hir~! to ~ h~lf of the labor r~tes th~,t you're looking ~t, ~nd ~he British ~re not uanskilled worker~ mt all. It's a question of how effectively you c~u% compete in ~he world:'econc~ny in mnJcing those %hings, not ~ust how effectively you c~xn cccapete relative to the cycles in our own economy or abroa~i. Ship building went massively to J&pmn and is now going ~ively to South kneric~ hec.~use ~he J&pmnese cannot compete effectively, and thmg's m canpar~ble sort of an industry. So, in .~n econc~ny w~ere we're now [m.~ort%ng v~_~t an~o~mt.q of mz~nu- fact~lred goths ~nd exporting vast a~nounts of ~rvices, notxDdy hesit~t~ 5o lcx~k ~11 over the world for their prcduc~. ~"fhat's ~ D, irly receng develop- ment ~fithin the ls_~t, eight to ten yes_rs. 'C"")%;I,;I~cNC)I{ I~E ${E~,%AN [Iq~FUS: ,~ SO our n~r. ion that manuf.%cturtn~, will r~'~rlng b~ck .may not be true because of world ccmpetition? DP.. DAVID BIRCH: : That's .right. As our econc(ny c~x0es roaring back tr.'s ~otn5 to lcok all over ~e world to r~x~r (r~n. %'~hat seems to be.. hap,pe, ninX ts you I~ve n bccm goin~ on in ~he knawledge-ba~e sector within your econcmy although it is n~uch nDre diffuse mhd difficult to see and vi~n~lize and demi with. .You can't take the ~all business cc~rnunity to lunch very e~sily wl~ereas you c~n r~e International Harvester to ltmch. C~VE',~']OR LEE gHE~',t%N DP~PfFUS: I wan~. :,~ ask you ~x)ut y~)~ ~t:-~ you include in yo~ definition of >~li b~iae~s o~ ~c~tvy de~ndeno~ on i~ly-own~ dairy f~ ~d our he~t~ d~:i>:ndence on ~ ktn~l ~[ ':,~ and ~ppr~h r~ ~he ~i~ industry? DP.. DAVID BIRCH: Actually ~riculture is not very. well ,mea.su.r~ in d~rz~ ~e, but mLae ~ur,::~ it ~tter dutn ~t~s~ m~y other. ~e do tncl~,h, yo~ f~rs ~ the extent ii,mt they ~e even ~ely c~rcial, if ~ney' ~o~lly f~tly-o~ we pro~biy don't m.~ th~ ~nd, hence, ~'re tn~ t~t factor. If they ~t ~ll ~rket their product and ~rrow f~ds chert we won!d ~e ~. If they're ~tally internal ~d it' ~hey co~ Chei~ o~ pr~uct then we wo~d not ~e th~. ~ ~'~e p=o~bly th~ ~ple ~o ~e ~l~-~tclently ~n[ng a f~ but tho~ ~o ~rket thei~ p~uc~ we ~d det~t. GOV'.~;OR .aL~FR{T ~3IE: At the end of your c~trnents you expre~ the ~rt~ce of the ~u~t[o~l i~t%tutions ~use it's ~oin~ ~ ~ high thought ~tther th~ ~le t~ our ~utu~ dlff,~renti~te ~rts of the hi~her ~u~tioa ~st~ ~eea t~hnol~y t~in- lng ve~ ~he h~n[~%~? I'd like ~ l~ve you ~ess the decline i:l el,3- mentz~ry ~d ~o~y s~tde~%ts' ~rfo~nce. tn ~[ence and ~th. ~e Natio~l .~s~nt fo~ ~u~ttonal 15 y~ of d(~l%ne in ~iev~nt in OR. DAVID BIRCH: Well thmt decline would tx)ther me a ,=T~ dell there ~re · lot of r~ns ~y ~t ts g~Lng on. ~t's · ~jor ~cern mine in generml. ~is ~y ~md he,et[cml c~ng fr~ ~~y m~ but I'm le~'~nce~n~ ~ut ~e ~r~th ~d ~ience ~n I ~ in tl~e ovur=l q~lity of the ~u~t[onml ~st~. ~e~'s m ve~ high correlmtion s~m)n~ [nstt~tio~ of higher learning ~d ~he fo~tioa of yo~ busin~us and the ex~ion of ~11 b~ines~s. In fmct, all the places ~t ar,~ doing well %n ~e no~h a~st in~imbly ~ve a l~e, ve~ s~ong ~nter higher ~u~tion. I~ ~n't ~ ~ch t~t they ~ ~e ~ mhd ~%en~ ver:~ the l[~rml ~ ~ ~ch ~ it is thmt they're g~ ~d ~tive. ~e of the strong ~nets for. yo~g, bright ~ple ts the ~ive~ity ~ich t~y They get there, they like it, they ~t to s~y there, theM ~nt ~ . m b~lneg~ ~o~d it ~th friends rand fmc~ty ~~. ~t's ~ue in ton; Minnea~li~St. Paul; ~hes~r, ~e~; ~i~n, Wisco~in; ~nd Ann Afar, The ~rowth rand dynamisim of those institutions is fmr more important det.~lls of whnt their detriments a~e doing. The hi~h-tech se~.~ent La ~.~ctur[n~ ts not so much of ~ ~rowth sector. In fnct, in .~u~s~chuse~t.~ n¢~' i.~'s agtually stable or declining. The computer~ a.re themselves going off sm)re. Nothing is moru e~sily 'aub~natx~ble rJ~m~ tl~e m~nuf~ctur[n~ of purer once yc~ get into it. [n th,~ :;oft~am; domain, the ,.~tucationnl preparmtion fo~ that ts ~c;~ clear. Th~,~ two e!even-ye~ old ~ds out in ~l[fornia, heavens their s~c[aliz~ioa ~s. Virsually ~y~y c~n enter the ~ft~ t~y're cl,~';e? ~d b~in~ttve ~d [nte?o~r.,~ in what's going on. Th,-, ~tr- tiers ~ entry ~ ~ch less ~nd the details of '.~t you n~l ~ do much less. I am concerned that we develop more m~them~ticians and sctent%sts, but I'm much n~Dre concerned r.h~t we develop bric, bt youn~ people in Eener~l because the w.~y we're going, it's br%~ht youn~ people %n §ener~l, and not m~them~ti- ci&gs and scientists, tb~ rare ~rticularly. requital. C~DVE}iNOR ALBERT ~JIE: In the thinkin~ of m~ny people, the ~ic ~alth sttY1 c~s out of the ~il (~ic~, tier, min%n~ ~d fts~n~) you ~yin~ %~t we'~e ~lly ~oin~ ~ ~ ~vtn~ I[ke S~rt~nd exist~ the midst o( the ~n~turin~ e~ ~d t~t we then ~ill ~ pcovidin~ tho~ klnds of ~ices for ~%e entire ~rld? ~ we s~tve if there DR. DAVID BIRCl4: I would argue t~ui~ m)t only are we mortals in that direction, we're mlr~y ~here. We ~ now m l~e ne~ exhorter'of c~~ble ~ o~ ~ic~tu~l ex~r~, ~nd a ~e net ~rter of ~nu- f~t~ g~s. ~s shift ~k place ~d 197~75, ~d its ~n ~ceLer- ating ever since. We're d~ ~ the ~[nt ~ere ~e ~rcen~e of ~ple ~in~ things or ~ng thin~s ~o~ ~ut one ~r~n~ m ye~,'~d only 2.5 ~rcent of o~ lair force is involv~ in ~ic~, only 12 ~rceng ~~E~ing, ~d it's ~opping a~ut m ~rcent. We've ~e ~t rr~i- ~ion, I ~n't jo~n~ ~ut ~tting ~y r~ining l~thes in ~he ~th~nian. We ~ ~pidly r~hin~ ~t ~int. ~e ~e ~n5 ~he Swttzerl~d of the . world ~ ~ extr~o~in~ d~r~. ~e only thin~ ~t s~rises ~ is ~t so few ~ple ~ve fi~ %t out. It's ~ire~y there, and ~ning at such m ~pid ~te, ~d ~y~ it ~kes ~ile for ~ple ~ ~te the statistics. S,~ tl~:~t ti% fz~ct i'd ~y ~:'d ramie, that s},i fi, wn.'ve l~.~:nme, a '~orld exporter of services. [~ r~ise~ ~ lot of issuas nix)ut n~tioaal security. I c~n't think of a better world deterrent than having .every nation depend on every other nmi[on. Consider the I~/Ir~ia~ War ~d ~w nobly could :~f[o~ t~t ~r. ~e Ja~nese ~ul~'t ~f[ord [t, the R~s%~ couldn't ,)~ o~ single ~st dete~ents ~ ~ is ~ ~t of ~tio~ zh~t ~n't afford ~ h~ve th~ f[~htin~ ~ith e~h other ~e ~ey're ~ heavily de~ndent oa e~h other. I wo~d ~o~y ~ut ~n~ no ~t~e tr~is~ or no ~re sili- con chips. We ~y~ ~ve ~ protect ceftin c~%tic~l industries incl~in~ ~hc~n when ~ n~ ~h~. If we don't prot~t ~h~e [ndustrLes t~ provide us wit, s our str~t~ic ~biliti~ then I think %~ have ~ ~1 probl~. ~ere's one, c~pute~ ~in~ ~other ~d ~el~~iczt[o~ ~[~ ~ t~ d~[on. LT. (]OVE~I'~H J,%', '{ES BRICiLEY: One'of t~e things we, ;u~ ~lltical le~er~ h~ve ~ ~ ~%h, is how do ,~ tr~late the f~ct~ t}~t you ~ ~w~ll ~t fo?n!~. How do ~ ~-gns!~te ~h~ [n~ ~litical ~[on? As you p~o~bly kn~ '%~ ~a ~'re ~11 here is ~x~e e~ch ,~f ,~r ~nlt,e~ h:ut ~ y~r-l~ng ~iI D~iness ~nference, t~5 fov the firs~ ~i~ se~ ~or%~ ~3end~ loc a~zl [ ~iness. ~, in eff~, ~ finally 5~k %)~ out ~) l~ch. i0 We he.~.~xi how .~-m~ll busings people feel about Sovernm~n~, how '~e tr~ns~t~ la~ b~s[ne~ ccnc~s ~ every%~y's aonc,~s, they were quite dYffer~nt. ~ of ~the things t~ey ~k~ we~. r[~i~ o~1 ~-- · 'get like the ~fom of our workers crop, ~plo~nt ct~p or ~ere I ~h[nk Q~e~ (s ~ conf~ion in. their ~nds is, ~wever, the r~l~tory clim~ ~d the ~%ce ~rfo~ce of stxte gover~nt. ~e r~ndztion of o~ ~1~ b~in~ conference ~ ~t s~te s~nt on ~u~tioa, le~ mney on .pr(~ns ~d ~11 that ~t repre~n~. ~ f~cinat~ when you co~tu~ ~ine~ develo~n~ ~h ~u~tton, %~ich [s our ~st ex~ive ~%ce. ~ ~n Fra~%n ~td, "tke only thi~ ~re t~e the le~ ex~ive w~y. I wonder if you ~uld ~t ~ ~t ~use lot of ~11 b~iness ~ple here ~ve ~, I tbi~, ~ t~nk t~t s~te ~over~nt is ~ bi~ ~d t~t if ~e ~d s~i~ ~ little b~t, they better off. ! ..,'%,-% DR. DAVID BIRCH: One of the things 're did in mnalyzin~ the locatior. decisioas of our busines$~ ~ra_~ to look mt p~)~erty ta~es Der c.%pit~, ment expe. nditl~.s ~er r~ptt.,, ,%nd other mea~ures of the ex%ent to ~tch .~ goverm~nt ~ or ~ not [nvolvc~.. We ml~ l~k~ ~t lair ~tes ~d of ~ ~r~,. ~e of ~he strt~n~ thin~s that ~es is that the ~e~ are doing ~e ~t ~nd ~ ~ve on ~ve~e h-f~'her ~ re~nmbly ~ buy for ~e~ ~xes. ~ey don't ~t ~ ~ve ~ p~vide ~obl~ ~s, ~ it d~ ~ 5~h~t%s, ~en they ~y ve~ hi~ ~es m~ get ve~ inferior ~ices ~ ~ for ~t. Ye hmve ~n~l health probl~ in ~ of the ~in~s ~ity's ~rception of ~t g~s on. incre~ in ~xes ~r y~ ~ 2 1/2 ~en~ ~r ye~. I don't ~i~ (w~ch ~ s~ongly ~p~rt~ by the ~1l b~ine~ ~ity) ~ in sup~r~ for lo~r ~xes. I think it ~ ~ mt~t to try ~ ~ld m ~l~ce of efficiency %n~ ~e S~te of ~h~t~. If they ~ ~t they gutting a g~ buy for their dollar ~ey ~uld ~i~%ely re~[nd their ~rt of Pro~[tion 2 1/2. IZ's an att~pt to cle~ ho~, not ~ mtt~pt t~ r~uce %he goverp~nt's ~llingne~ ~ provide ~ices. ~ey c~s~n~ly So I think you ~ve ~ distinguish ~5'~een %he level of ~es ~d ~he e f ciency %%~h ~ich ~ice is provide. [ ~hi~ ~hey ~re violently op~ inefficiency. I don't thi~ they're opted ~ higher ~es, ~r ~, all the st tlstl¢, l evidenc we lave s ys t mt they ..re flocking to wlin higher ta s- -bUt are which nan '"6i 'the get your act togetJ~er ~nd cleaned up, not to necessarily reduce the level of .ta_x~tion ~t the state or the lcc.~l level. I~T. CK)VEKNOR JAMES B. RIL--XLEY: Is there .some confusion in their though? Do ~11 tx~sin~s people matumlly see it that ~ray? DR. DAVID 'BIROH: Well statistically they do. If you ~y tlu~t they're voting with their feet, the amswer is yes. They're axltively seeking out places that provide high-<tu~lity services for a reag~oamble ~ dollar. <They_ ~lways _ccmpl~.i.n_.__~_.U..~' ._t~__e__s_._ ?here hz_~m' ~ _b?~..n..~ .~.u_.siq~__~__n._.I_'_y..e .e_v_er i-~terviewed ~t hasn'..t..c~l.-~-~_~'.~-J]~o-~%-~x~.q',"b~t- [~ y6'~ looked at bu~ine~ pecf0~c'~;-~~heF"don' t beh~ve ._a~_ .......... 'tho~ghYt~xx~s. are that 'i}~'P~-~'"~'~: ............. CK~VERNOR LEE SHE]IV~xl DREYI.XJS: Let ~ m~k you a~ut t~,shlft fr~xa m~ cles ~ b~i~, ~ yo~ put it, and the shLft fr~ physL~l c~pt~l ~ capital.. ~e~ ~e ~o f~d~n~ily dif[erent direct[o~ we could go. One is ~ restrict ~cess ~ higher ~ucatYon ~d put yo~ energies and dol[ar~ ~%d re~ces ~ the "~st ~d brightest." The other ray t,~ %{o is to o~n the pl~e up and try ~d ~ve to 100 ~rcent of the yo~ lnb) ~ of ~ high ~1~l ~u~tion. '~e question then ~c~:{ one of example. ~0~ly, ~ n~ ~ve ~ ~owing %mioni~ withfn ~u~tioa that lobby ~ eff~iuely t~n the ~iversity. Thinly, the mayo~, the cowry ~s, the ~,~ship ~ple ~ all the ~ple ~o repre~nt l(~al ~overn- ~nt. ~e ~iversity is ~ut n~r fo~ ~en it u~ ~ ~ ab~lutely ~r one, the "c~ jewel." At ~%s ~iat ~ey're ao~ only not the jewel the c~ but the ~ ~ ~n ~en a~y. %~en there's t~t c~titioa and ~ ~s~ictioa of ~~g, ~ich ~y do you think we ouEht ~ ~ trending? DR. D~VID BIRCH: .'.(Let me first try to serrate the politics of it frown the. necessity of it~' First of all it's clear which direction we h~ve been trending. Twenty or thirty yes_rs ago only 6 percent or ? percent of the %~)['k force gained & college education on the ~zxy ~o the labor force. Now tJ~at's up ~round 45 percent or 50 percent. We've made a m~_ss%ve shif~ towards pub- ting a ~emter number of ~eople into the highe.- educ.~io~ syst~n. Given that only 12 percent of our labor force makes anything anymore, ~hat's dropping about one percent every year) virtually every young ;~merican is going oD have to get a~ much education as they .cossibly c~n. The thing that's so encour~ing about this is that the~e ~re lots of routes to follow ti~at ~ren' t. just limited to the forn~l e~uc~tion syst~n. The Control Oorpcrmtion in ~,tinneapolis-St. P~ul represents a very inter~ing exper£Tent. They'.ve invested heavily in the Plato Systa~n to develop ~n e.-luc~tional cur- riculum that goes frcm kindergo~r~en all the ,~ay t!~ough 'advance] bicchemistry '~nd any form of graduate education you ~nt. It requires no .%thcol to ?~r- %'_ct?~te in, i~ rec. uires no formal teachers or faculties or bud%e% to eh=mae tn. In fact, they've introduced recently a ccrnputer terminal ~ha-. you can b,;y in your hcrne for $~,000 or ?x3,OO0 ~ha~ ~_!l ~ all %b.~t currtcu!ura. So I would define education well beyond the nmrrow confines of the c!.~- roan. 'It's been ~. ~mat,-.wi that scmenhing like 70 perce,~t to 75 perce:~t the jobs in the next five or tea ye~urs will be. canputer related in ,)ne ~.y or another. The way t~t r~=ople can be educated in ccmputer~ does require the rigid sort of curriculum tlu~t is found %n the co~%ventioa~ cla_ssrocrns and the conQentionml educmtionml syst~n. .%0 [ &n~ver tn w~ys. First of roll, yes, everyone will hzve ~o get as much education · ~7 ~.1, GOVF_%NOR LEE ~{ErLV~uN DRE~q~Js: Given t~hmt option, would you move resources in~o elementary,,~.and Ness into grist high schcxol? . DR. DAVID BIRO{: If I were ~iven timt ~h~nce I would. Ccmi~ fr,~,~ ~nstitut[on of hi~her ~ation, I'm not en~ll~ ~h ~he ~te m~ '~ich we ~3ust ~d ~apt ~ c~ge, and ! c~ fr~ ~ relatively ~p~le It's ~id t~t [t ~k~ the high ~h~l ~st~ in P~ladelp~m 28 ye~ fully incor~r%te ~ d~ns~mt~ ~tter ~y of doing ~i~. Given rinses of t~ov~tion ~thin ~he ~h~l ~st~, I wo~d explore br~ly how la we're go[n~ ~ get yoking p~)ple ~u~lf~t. I ~uld t~ ~ get ~re c~puter refills in ~e el~n'~y gI~es. ~e q~tion I would is ~w much ~c~s d~s ~e s~dent ~ve ~ ~ c~puter ~i~l, we'~ ~vin~ %nto ~ te~ln~l ~om~y. GOVERNOR LEE b~tE~'~Y DREYFUS: A hcmputer kind of liter,-cy?. DR. DAVID BIRCH: A ccmputer literacy of some sorts. I would even look into.p~ that wo~ld assist less advmntm~ed families in ~t~ing c~nput- ers [nOD their hc~nes directly ~s., form of education, and. start thinking z.bout what ,qr. Norris (Ch~irmsa% of Control D~t~) is doing i~ the w~y of Pi&to mhd hc~e education as distinct frcm school education. ~Lny of ~h~:.~. kids learn & lot more at home now th~n they do in school. .%o I'd look ~ all forms of education, both ~ and outside of the school syst~n. But r. cer~lnly would not neglectothe"~uigher education syst~n s~nply because of the cr. edential n&ture of our econcmy still. The credentiml of a degTee s~lll memns ~ lot. GOVERNOR ~ SrrE~%~N DREYFUS: H~ve we got & new. displaced group of people [n this country because of either bad education, bad hcme condlti(~ns'; bad social condiditons or wh&tever root cause? Are we turnin~ to & pcx~itkon where we're goin=~ to turn out ~ fixed numbers of .%~ericans who ~_re not goL,~ ~o be viable in the future you have predicted? .I)R. OAV!D BIRCH: I suspect we .~re. The economy is now adjuszing froster ~han ~,he ~h~l ~st~ ~re c~ble of mijustLn%, ~o i~ ~s we're going ~ l~ p~!ucing ~n ob~le~e p~uc~. That's ~y you're s~:ch ~ relative ducline Ln the ~rfoL~rance of~'~ondarv'. . ~:h~l students re!~ive ~ ,~a~ b~inesses ~. In fac:, one of ~ne thin~s you migh~ stroa~ly consider (since business has a mucl~ better ide~ of what t~ needs th~n the school systa~s) is t~rgettin~ sc~ne of your %ncentives to the busi- ness r~t~her than to the school syst~ as ~ forth of obtaining education. In other ~ords, tr~-inin~ in c~nputer li'teracy '%s Perhaps better done by the end user. of the produc% th&n scme intermediary wholesaler of it, namely, the school syst~n. CovEr{NoR ~ SHF21%iAN EREYFUS: What should we do ~ith roll these people? As you've looked at this d~tm, you must &lsd be awmre of the number of people winding up in u~.employmen~ who m~y be "unemployable." OR. DAVID BIRCH: Actumlly I'm less co6cerned with the young ~nploymble t~uxn I am ~th the elderly ~ploy~ble.at t~[s ~[nt. .~ple ~mder 45, or , cer~inly ~der ~, do ~ ~~ly ~aptable. We have ~ file on the ~ory of one ~d m ~lf ~llion ~~ of the ~rk force ~nd every job ~ey have held over ~ eleven-ye~ ~r[~. We follo~ th~ over t~ ~ ~ ~t they did ~ ~ere ~ey ~nt ~d how ~ey ~prov~ th~lves. ~e ~ple ~mder ~ or ~, ~, in.f~t, ~r~bly ~ap~ble ~d ~'obile. It's the elderly, ~tlcu~ly the ve~ ~11~ elderly, t~t may ~ ~ ~ ~re pincer %~ the y~ ~e. ~e yo~g ~n ~ve ~ Ho~n; they cnn go ~ck ~nd g~in ~ fo~ of ~o~y ~u~tion. I have ~n in Bill Norris' Fair Bre~ ~nte~ ~ &~~lis ~ ~t. Pm~, d~ ~dicts c~ing off ~he strut mhd ~u~tin~ ~lv~. It'k the ones ~mc get a~ve m cer~ ~e who~ ~bility ~d ~aptability is ~ch less tha~ I 'm ~ch ~re concern~ a~ut. ~y"p~nt ~ ~ ~ ~ute probl~, ~rticul~ly given ~e difficul- ties of ~iml S~ity. C~)VE~{NOR LEE ,SHE~£~N DREYFUS: You're t~lking about the one t,hat the robot replaces. He owns m home, he has m job, he's been working fo~ A,%K~ in Kenostm and he doesn't wmnt to move. DR. D~VID BIRCh{· Thmt'~ right he ha~ a f~unily and hms ,gt-,~wn up there, he kn~w~ tt very well. Ail Df our evidence .~n~gl~'escs tl~at migration and the ability to move drop off very sl~_rply at about age 35. ),{igr.%tioa rates, job chan~e and occup~tion-~l mow.~nent goes w~y do~ d~ln~ the 35~5 y~r old ~ge. Another probl~ is ~he o~lete p~uct c~Lng out (>6 the sch~>l syst~. I would t~n ~re ~ the co~rmtions t~n the ~h~l ~st~ ~ de~l ~h t~c probi~. I~'s a ~ing ~ing ~ ~y a~ut the ~h,~l syst~, but I ~uld rmther rely on ~11 ~iness ~ple ~ do ~hat job t~n I would to try to p~s~e the ~h~l ~ys%~. I w~ in St. ~uis a couple of w~k~ ~o and I ~sKed ~hen how ~y. c~puter ~n~!s there we~ in ~he St. [~uis ~h~l syst~, l~klng for ~thing on the order of one te~nal ~r ten stu~enL~. The ~n~'er '~ z~. Ze~ c~pu~er ze~nals in Lhe entire Ci~y of S~. ~uis s~:~l syst~. Well, if ~t~'s true, I would not rely on the CtEy of S~. ~uis ~h~l ~fst~ ~ ~lve the probl~s of .h. next ten ~ fift~n ye%F$. COV~7~NOR ALBFJlT qU.IE.: Le~'s p~e t~t ~ little bit f~ther ~e h~ve · really d~p concern ~ut the ~u~tion ~st~. We've ~ot o~elves 'in ~ ~cio~ c~cle ~~ we've ~e i~ ~ier ~ enter ~t.~on~ ~u- c~tioa, ye~ ig's '~o~ ~gher ~u~tioa i~ti~tio~ tb~ ~e pr~ucing the tethers fr~ the lo~r. ~rt of the ~hol~tic level. We're f~ ~gh ~ v~ry ~rio~ p~bl~ if we're going ~ ~ ~y the "~rl~d of the world." ~nt~L ~ tri~ ~ do i~, bug' the ~tion~ op~ition ~ su~ sti~ting m ~hine for a ~hev ts ~ eno~us ~d the ~liti~l clout they ~ve ts ~ndo~. I ~hi~ ~ l~ve ~e~ w?~t is ~bly ~ut ~jor · concern for ~ in ~e ~on~c ~u~ of th~ ~t.%o~ ~ ~~ we h~ve. How do we ~e ~ch m ~icml DR. DAVID BIRCH: Well one of the things thmt I kAo~ Control .D~t~ was s~ron~ly ~hind ~ ~ ~e ~ have the Unive~ity of ~~ give f~ulty ~rs ~o or ~=~ ye~ leave of absen~ ~ go out ~d ~ up b~tne~s, ~d the~ ~ ~ck ~th no l~ of ~niority or tense. On 5he b~[ne~ end they're trying ~ get fsculty ~s ~ leave ~d ~ up m b~l~iness '~thout ~y D~is~nt ~o~ ~vtng doue ~. t %~ thmt M. [2?. ~der a lot of pres~e now fr~ the h[gh-t~h ~nt of o~ ~on~ny ~o up ~ ~[mte d~r,~ or ~rt-t[~ degr~ ~ ~hat they ~n r~i~ and, tfl ~, ~[ve th~ ~n M.[.T..+d~r,.~ ta the pe~ess of ~he~ '~rk; the ~u~tLoa syst~ m~ ~ ~ttr~ltive ferule to ~t%n~ en~in~ ~ ~d ~ t~t yo~ entrep~ene~ [z~ the Ua[ve~[t~ of ~,~nn~ · ~o out ~d s~rt up b~[n~$ ~d gain ~ ex~r[en~ [or ~t it's like, ~e.I th[~ their students ~u~d the~ ~ in ~ ~ch ~tter ~[tioa ~ do che ~ thin~ ~a~ .~ey'd ~ve the pr~t[ca~ ~ck~o~d o~ the little ~ne~. ~y do w~-h~ve.~ few c~p~ter ~[entis~ ~o[~ ~to · n~re? It's not p~fit~bl~. ~y~ you ~ ~e it p~[~le, not r~[sin~ ~es, but b~ givinU th~ op~rtun[t[es t~t they-~'t .h~ve ~ ch~o~ ~ ~rtici~b~ in. ~ I thi. nk giving th~n incentives ~ right th[n~ wo~d not ~ a ~d idea, but.you're going ~ ~ve ~ rely ~d ~re on the end ~r ~ do ~e job. LT. GO~7~Rh~)R JA~ES BRI(DfLEY: I have ,, feeling= that our ~41ole regul~t,~ry scheme h~s been b~.~ed on bi~ness in the private sector, mhd ~h~t we hmve c~..~- rated & lot of the inflexibility in the private sector. Wh~t ough~ w~ r~ be doing in government as far as regul&tion? We still h~ve this strong desire out r. here to protect the environment, to protect the-s~fety of the work place ~nd roll of these other things that are of incregsing interest to us. DR. DAVID BIRO{: The first thing is to get rid of the mbsurd thin~s ~h~-t irri~mte everybody. There is ~ regul, tion in the Ci%y of Boston r~4uires ~h~ anybcdy who hangs up & sign taus% ~ng it high enough so that ,~Dun~ed horse.q~-n can clen.~ the sign. Wh~t is required oD keep ~h~t sign tha~ level is so obnoxious that that kind of relpalazion, it seers the first thing %o get rid of. Just go t~hrough ~he books ~_nd get rid of ~11 the things ~b~ ocme frcra ~/le 1820's and no5 the !980's. Beyoud thmt, on the national books, there is the reg~alz~tory ~lexibll[ty mat which allows ~encies ~ ~t ~ller b~ine~ses differently t~ lm~er busLn~s. ~e of ~e obvio~ f~ts is thmt filling out m s~te fo~ ~es ~USt ~ ~ch effort fo~ a ~11 b~ine~ ~ a l~e b~iness, but repre~nCs m ~ch ~e~ter ~en~e of the ~tal ~ces of the ~11 b~[ne~. would ~ ~ ~ t~t allo~n~ ~11 fi~ fr~ fr~ fillin~ out tho~ds of ~o~ t~t ~e ~ ~t l~e ~n~c~rin~ plan~ ~i~ ~xic ch~ls mi~hC ~ a ~ndo~ s~p fo~d. It's ~r~ of a chipping ~y pr~ess, don'~ thi~ it's a ~ive pr~ess, but ~e di.r~:tl,)~ ~ clear .~d I think r~ flex mt ~e U..S., level offe~ a ~el t~t I wo~d ~g~t s~tes l~k at. ~st ~atio~ t~t ~oy ~1l busine~s ~nd ~ ~ s~ ~d l~1. I ~ get~ia~ rid of the no~n~ ~uld cle~ up y~ ~h[nk would go ~ long ~y. J~t get ~id of the C~DVEI{NOR LEE SHE/I~N DREYFUS: Let me ~sl¢ you ~nother either/or quest[on. Although I do ~n~ ~ tell you t~ we h~ve ~v~, or ~tt~p~ der~tioa in ~is s~te, ~d ~ ~e~ di~g~in~nt our bi,est op~itioa ~ c~ not f~ the r~la~, but fr~ the r~-' l~t~. It's ~t ~ if they've gotten ~dict~ Would you urge new businesses to invest in the young, .mobile, more highly educated ~rson, or in this new cla.~s of "econcmic d.p.'--t~hat 4.5-50 ye~£ old who nu~?ds to stgy where he or she lives, who needs to work aakl who work, but who now needs retraining. We may even have to reduce wages 10enef[~s if he's starting over,~ ~ career. That cregte~ m psycholcgicml puoblewn if he's been in ~ secure on-going position. Wh~%% would you 5ive ~-~ general advice to ~eople who s_re going to start hiring? DR. DAVID BIRCH: . Well, th~ old econcmy ~nd ~he new ecoacmy is chmrag- tcrLz~t by my descrLption of Michigan. It h~u~ ,% hu~e depre:~sion and a blj~ ~x~ going on ~t the ~ ~, ~d they ~ve~ge out ~ m r~u~sion. The ,Lvem~e ts going ~ shift, ~d ~en it dc~s, Lt's goLng ~) pr(xt,lc~{ a p~rl,wJ ,)f g~wth. ~e d~nd ou~ of the new c~:om~y loc ~ple is very gr~t :m(I . tc'.s no~ ~ing ~t. ~e~ ~e not enough ct~puter ~opl~. I don't thl~Lk you lu~ve ~ ~e a choice, I d~n't t~ the~'s a ~%mge ~nci og decLsioa ~ rake. If YO~5 ~ple ~e willing ~ c~ into yo~ ~ntrol I~ l~tltutes any~y you ~n ~~ we ~ve m big shor~e. ~ere's no s~pl~ of l~r for the new ~on~y, it's in ~he old ~on~y thm~ there's a probl~. ~ere ~re co~n~ ~pl~in~ t~t the~ ~en'~ enoch pro,fly ~':~lnc~ ~ple for the ex~~ ~to~. ~ I don'% think you ~ve ~ ~e. Older ~rke~ ~re ~re l~ely ~ ~ s~ble, they've got their hour, they'r~ le~ 1Lkely to ~ve i~y. ~ey're p~bly ~ g~ ~ ~t m~ ~y~y. ~e probl~ is p~- s~ing th~ ~ ~ke t~t leap, ~d I'm not su~ how we do that. Bu~ I don't think ~he~'s m probl~ there. CYOVEI~OI~ LEE ~]tl,~;t~N Dlt£~fl.~dS: IC.'s '~ fr%~htcnln~ ~n~tety probl~n ~-50 yea~ old experiences t~C.i;~ 20-25 ye~ old does no~, The youn~ co be lcokin~ ~ ~ new c~reer; :they expect to be Ln or out o~ ~o£k ing somet]~in~. They've ~oC ~ Ii.~e ~.hem~ of them. The older person ~o is more settled 'h~$ never been unomployed in theLr ~ives ~c~use of the ~ener~- cion they ~ere born ~n, and suddenly ~re g~¢ed ~th this incredibte experi- ence that tends to destroy the. ~z~,r.~o~ re. lief in self. DR. DAVID BIRCH: There is a r~dical shift ia the structure of the house- hold within the strucgure of the labor force, ?~rticulla~rly for w~rnen in ~he l~bor force. P~ther than one person ~mchin~ in ~ time clock with & lhnch p~il every d~y, it's t~o or t~uree ~)ple going out ~nd getting ~obs, in .m~ny ca~z----------------~es on ~ ~s.rt-time ~_~is, wit.him the same household. So that household inccme is continuing to rise even tl%ou~h hourly wa~e r~tes are declin[n~ sligh~ly. One of the thin~s you can do 't~ ~remtly s_~s[sg .~,! older person taking this %e&p [s to m~ke %~ e~sier for his or her s~ouse to &lso join the labor force to e~se the shock of the transition. Because frequently it '~l~ involve m cut tm ~y, 8.nd that is very demoralizing, unless you c~u% offset it with an ~ncr2ne ccming into ~he household frcm scmewhere else. So, encouraging ~rt-time work ~ people to take on ~urt-time ~rk, and encou~4~ing in any ~r~y you.-c~n the ability of wcmen to enter the labor force goes & long w~y to e~sing this tr~_nsistion kec~use it allow~ the household ~o continue i to increase their inccme even though the individual does nog. C~DVEHh~DR~AL~{T ~UIE.: There also ~ ~ ~ a ~o~ ~p~tion of ~ple ~o my ~rk in their h~ using the ~puter. I ~ ~ m~ ~d ~re lndiv[d~ls ~o s~nd very few days ~ of · mnth ~k ~ t~t office. Is ~ · ~ing phen~non, ~e ~ple ~11 ~e" ~or~~," t~ is · going. ~ ~ ~v~ilable ~ ~, ~nd ~t eff~t ~11 i~ ~ve on ~ity life? DR. DAVID BIRCH: I think definitely so. I have a term[nm! in my house and spend p~o or tkree d~ys a week not going= into my office and do all my work through teleccr~Tzlnic~tions. I h~ve a pro,rammer ~ho ~orks for ~ ~o lives ~0 miles a~r~y an~ works out.of her hc~e ~nd wTth no probl~ms .~g all. .~ substantial Uroportion of mf labor force in my ova little enterprise .,t ;~.I.T. never ~ ne.~r M.3.T.. They ~ork through telec~,~nic~tions and the ~bility to do that is increasing dram~tic&lly. ~m~ny national corpora:ions ~re now setting up networks to facikit-~te %his. This is ~ied ~ the r~pid ruraliz~tion of the American ~opul~tion. A very' r~pid shif~ [s ocurring ~y fr~ ~o~l'[~n ~e~ in~ ~ ~. A lo~ of tho= ts ~e you ~5 do ~is ~nd of t~. ~ere is a little ~ up in Ne~ H~shire ~ere ~thin · ten~le ~i~ of do~to~ t~y a~ publtsh- in~ ~5 ~in~, incl~in~ ~ rather well-~n~ ones 1E<e Y~ ~ine and Bi~e ~-~-~ ne. ~t's ~in~ done by ~ple ~r~n~ ou~ of =heir h~s and c~r~ in~ ~ office fr~ t~ ~ t~ ~d .~ther!n~ info~ztion over ~e!~u,,~i~ions ne~'~'or~ ~d pr~ucing thee ~ines, tn ~ny ~s ,~i~hou5 even offices. 17 I would hi~hli~ht the importance of telec nmunications in this. Telecanm m[- cn~ions is ~0 the futnlz-e wt%at ener~oy ~nd %r~ns~r~ioa ~re ~o the ~st. T~ay, ~phls, Tenn~s~'s ~e~test russet is t}~at %t h~s the l~rgest el~- tronic ~tchin5 neP~ork in ~e ~try now, ~t up by Holiday I~ ~d F~eral Expre~. ~t is one of ~eir ~jor ~ces. It's not their rivers ~d their ~r~rs ~ their ~il lines, but' their ~l~~i~tio~ sa~tchin~ net- work. With ~tellit~ ~ng, tho~ ~e~ in stxtes ~ cities that ~ve ~ very pr~ive, t~ically ~v~c~j telec~ir~tio~ s'yst~ will ~ve ~lat the ~r~ ~d the ~[1 lines were to the 1820s ~d BOs. I wo~d worry ~ lot m~ut ~u~tion ~ t'd wor~ m lot a~ut tel~~ir~tioms. ~: '~'e're ~l~ng a~u~ ~n! ~l~r concnrns and ~rhap~ ~,)~i ~r~ ex,on, kc. flexibility going ~ le~ ~ ~.)ra [nd%vid~a~l%~ in thLs nx~try ~n the future? OR. DAVID BIRCH: I think we'~e 5hink it's one of o~ ~'~test s~ren~t~s. ttnct~on ~een ou~elv~ mid .Tarn ~. The Ja~e~' ~ve ~ ~r~ndo~ ~s(:~ tn ~ing ~bie to copy our t~i:- nolo~ ~d ~ pr~uce ~ings. ~ey are no: very individ~ls cremtin~ ~ov~tive fo~ of q~nttty. ~ey j~t don't ~ow how to ~o 1~. I re~ the ocher day t~ ~re now ~nding la~e q~n~tties of fiv~ye~ olds over here ~ individ~ls. ~ey ~e n~ising d~ I~ere [n ~}~e U.S. cul oir,~ ~,] taking th~ ~ck ~ Ja~n ~ develop a tr:~[tton of Ln,Jivtd~Lt~ wi~ich do not ~ve in Ja~. We've alsys ~ :hat. Every survey I've ever seen s~ys th~kt the ~ve.r~uge ;u,~rlcan ~uld IL.K~: t,~ llv,~ in ~ b)~ of 5,~ ~ 10,~0 ~ple. Cities were an artifact ,~' the ind,l~-. trYml revolution, not of p~ferences. We've never ' ~V~. ve d l:~- co~L~tivittes or of ~e i~titutLol~. We ye never lLkcxi tl~n. ' .' tr~%e4 th~. We've alsys ~t~ ~ strive for ~ m~ity, ~inE' ~le ~ ~ a ~h~ c~tt~ ~r~n or whatever ~.rtici~te'in t~t world. ~ [ think that's o~ ~e~t strength in the ~uture, is t~t you ~ do it ~ your ho~, you r~n do it ~ an ind%vid~l. You don't ~ve ~ ~ ~rt of ~ ~nera~ 5{o~)rs or ~n ~over~nt in o~er ~ ~ very ~ffec~ive aro~d the ~rld. I LT. CD~R J~%~-E BRI~EY' Will we ~ able ~ ~re~ question, this nine ~ five, "c~ %n th~ ~%(~" :~ ~ ~ve ~n ~therinE ~s for the l~t d~e? I)F,. DAVII) BIR~-H' I th/nk so. Yes. ~;,.. Il hay,: ~ tak~: r.'.,~ i,i,~,~ :~hi. rt.s :tn, I the lathes ~d put th~n tn~ the ~u~.~ I~.~t. tn '~ '.~:~y. It..~u~ .~:::~t .~.} ~in ul~e l~t year t~t "clerk" ~ the sLn~le '~s~ v~,ew the tndustr~l revolution ~ ~ ..short, .~n~li ~le ~ricul~re ~d a ~ra!t ~le '~' .'' things. But we cazr~ a~ a nation of cotuxges and .~r.~ll towns, we ~ve ~ ,~ ~ll.~un'[~tes'in the Unit~ S~tes, and ~ r~pidly ~ we ~a ~'re ~vin~ · .~ck ~ th~, ~nd ~e 19~ ~nsms shb~ tlmt. that's ~n ~p~ni~ at ~ str~ng ~te ~d ~l~~i~tions ~es [~ ~sible. ~, I thi~ the ve~ion ~ ~e lndmstrial revolution,' not the nom. CDVE~NOR ALBERT QOIE: It .~ interesting to me that v/nile government formerly moved to. rd centralization, .today people ~ ~sking for a gre~ter voice in wh~t h~ppens to th~m. I find that fascinating ~rith the New Feder~l- ism debate. Mally people are now aztvocating decentralization. People will a_%sxane wore of their own responsibilities.. DR. DAVID BIRCh{: A reporter called me up the other d~y and asked me about v~hat's 'happening in government. Isn'~ big government eating up the country a~d isn't the federal government consunztng everythi~? So I looked up .sc~ne numbers and they're very Striking. In 1950, 1.3 people worked thC feder"~l government out of every 100 America_ns. tn 1981 1.3 people worked in the f~deral government' (or every lO0 Americans, so that hasn't changed at all. On the other hand ia 1950, five ~eople worked in state a_nd loc.~l gov- ernment for every 100 AmeFicans. That's gone up to 17 people per 100 Ameri- cans. So that, in f~ct, you have a rather sukgta~tial increase in the e~er- gence of local ~nd state §overnments a~ distinct from the federal government. The federal governfr~nt ha~nu't exp~nded at all and I think the New F~deralism ~i[1 ~c~elerate _that if the President }m_~ his vary. It's & shift that very much ~rallels the decentralization of business aald the decentr~liz~tio~ of the population in o~nr states, both of ~/nich are goin~ on very r~pidly. LT. cfjVERNOR JAMF-g BRIC~,~Y: But there's something beneath thcs~ figures. If you look only at the number of people vaho %~rk fo£ the federal =~overnment, that's gone down. But federal spendin~ h~s gone up. State p~y rolls h~ve gone up but their spending ha~ not necessarily gone up. Now what's hap~enin~ is the federal government is funneling doll~rs. They're takin~ money frcm us then giving it k~uzk to us and we hire the ~eople to administmr their pro- grams. .So the figures you have on the surveys are & little deceptive. There's a ~ittle more there than it ~61d appear. DR. DAVID BIRCh: Well, there's the question of having the dol~ flo~s be ,more ccmmensur~te with th~ service delivery. In the process of doing tha~ it gives you a chance to ~ddress this efficiency question ~nd the image you have wi~h the business ccmmunity. As you gain more control of the dollar flows y~uurself rather th~n vectoring thc~n through ~he government and back, you have a better ch~n,ce to create a self-image as being professionally run. c~9V-LO~':OR [-~"~-~ ~JA~N Eg~YFUS: It's the government's Golden Rule: ~no ~ uhe gold mai<es the niles." "He Let me just give you m quick scenario of ,~na~ we've done ~ec~use your dar~ frinkly m~ches ,~h, at '~ thought w~re the early indic~-~ors of where r~he s~r~.ngth should grow in-Wisconsin. We t~ve realized the importance of Mil business within our t~0~ony, . '~%th our ~anp~ t~D c~nc~n=r~ c~l it, we ~ved tb2~t l-est:onsibility in s~te §ov- er-hr in~ ~eute~t ~vernor R~s Ol~n's office ~ ~ive %t visibility. We %~n~ .o~ Lieute~nt ~ve~or ~ ~e %he. f~al ~int ~ the n~r ~o' const~tional officer in this s~te. %~e ~hen incr--, ~d ~e ~ntin~n~ ~ ~ve ~ ~idly ~ we ~, o~ e~r:' tr~e m[~io~ ~ ~ ~p~is ~ ~11 b~ine~, ~use bi~ bu~ine~ h~ their ~ ~ple over ~e ~d their o~ conn~tio~. ~e first ~e ~ sion in l~9 ~ alre~y ~uc~ ~0 'million for Wi~o~in ~d obvio~ly ~he jobs t~t go ~o~ ~th it. We've ~i~ ~ ~ve ~11 b~iness in~ the Pennon ~~ ~ ~ ~ut ~he ~th s~te in defense p~~nt. We fo~d t~ o~ ~11 b~in~ ~ple ~nd ~l'l ~nufac~urel~ f~c~ probl~ in getting ~ ~e ~n~on. ~ we b~ught their p~cnm~[n= ~ple here ~d ~ t}~ te~h 3~ ~11 ~ln~s le~e~ how you buy fr, m tht-~. We I~ve now proposed ~ Wisconsin Develounent Authority to a.~Lst .~nall busi- ne.~uses in r~isin~ start up and opermtin~ caDitml, now in short supply due hi.~h interes~ cost-~. Finally, I'm tryin~ to create worldwide Wisconsin offices ~rithout cre'~ting ~ btweaucraay. I'm n~×lel[ng it ~fter th~ Uni. ver~lty Alumni .~pproax:h in which.we would designate ms honoriry econc~n[c counsels or mtr.%chees people ~aho have ~ %Visconsia tie, either.by bi£th o£ by education. They wou_ld be mv.~ilmble to help people if ~hey ~ish to do busineg~ oversea.~. That's a_n outline of wh~t we've done here in Wisconsin in ~he. 1..nsf two one-half years. DR. DAVID B'1~'HL.~ It obviously makes a h~reat deal ,of s~:a~e, to ,~. l think its ~rtic~ly ~rt~t ~ reml[~ ~t the ~all manufacture~ ~e j~ ~ ~1 ~ ~e ~ice,~r. ~e fac~ t~t you're help[n~ th~ get to the ~fe~ ~~nt ~d helptn~ th~ exl~')rt abr~i ~kes v,~ry se~ ~ ~. ~e dicho~ ~ not ~n ~n~'~ct~Yng mhd ~ices, i~ ~n ~11 i~ovmtive eate~ri~s ~d ente~rises t~t .~e involv~ older, ~bllsh~, d~lining or ve~ s~ble industrle~. ~ I think foc~ oa the ~1 ~mc~re~, ms well m~ the ~wice, .ts m very ~nsible thing ~ do, 'mhd ~here ~e la~e ~rket.~ for th~ ~r~d. C~DVE~NOR [~E SHFJ{%{kN DREY~S: How far should governn~mt ~et into [{ow far should goverp~nent get into cap[tnl development? There is no questi,~n in a%, mind that we are dealing ~rith foreign governmental financin% in b~ck the.se foreign cCrapanies, and in scrne cu~ses, i~ is al3nost predntorT. Ia ~ny c~es, foreign ccm.canies are literally gettin% governa~nt sutxsidiz~tioa help them export. DAVID BIRCH: There's one big difference though. A lar%e percentage ~he cgpiLal going into ~.~T~.a~ler busine.~..;, Dgrticu]arly in the. sa~¢ice .,~:- ccme$ frcra private sources and not frcra institutio..~ of any ~ind. come. s' from friends and relatives and the proverbial "Aunt. Ag,%th~." That difference beu~een oupselves and ~-rne other countries. For extol, pie, lam~e Dutch corporations will have ~0 percent equity ownership by the =~oveFpJr~t wherems Ln our country tlnis '~ould be unthinkable. ;Ye fret l,~n guan~nuees -~o Loc,~:e~-d ~%nd Crysler. .ere is & bi~ difference in the way our cul~ares work. 'Ne ~et ,~)st of money f_rc~u "Aun~ Agatha" and it funnels v3krough Drivate sources ~ther .~n th.rou~ insi~uti~ons. IQ f~ct, that's one of the res_~ons we can s~r~ ~ 600,000 new busines~s this yes.r ~rith intewest r~tes ~ high ~ they are. .~one of these s~all businesses had ~o §o to. the ~h~ks in the first place so 'they don't even know wh~t the interest rage is ~nd don't care because they never even think of $oing to the bank. A~ m state policy, .uer,haps we need to ask how to make it more attractive for "Aunt ACmtha" to ~t her money into ~ s~all business. There is ~ bill now before Congress to extend to all s~all businesses the Drovision that you write of~ all of your investment in the first year. That would make small businesses lcok. very attractive relative to real estate and the money market [unds. The tax shelter implications of that ~re st-~gertng. So there are things ~hat can be done within fedez-il and state s~tutes to stim~te the Drtvate caDit~ to ~1~ that's different from the Europes~s. GOVERNO~ L~ ~]~MAN EftS: I tell you ~a~rthing t~t I can do will ~zke it easier to invest and easier to' create jobs, that's my end go~. You mentioned Japan is res.lly .losing, and boy are they doin§ it in style. When I ~ a k~d in the service I used to box. During one bout, ~ kid clobberin~ the heck out of ~ and I came back at the end of the second round ~nd that old chief said, "[kDn't ~orry. kid, you're ahea~l on points." I dich~' t know if I ~ Eoin~ to ~uke the third round. Are you real.!y sure they're .losing? D~. DAVID'BIP~: I'm not sure they're l~in~, but I'm win. In o%her ~s, I don't ~nk t~ ~hey ~pre~n~ gtve~ ~e d~u~tion. ~'re ~ing. We ~e very c~ttble ~d rather tt~ op~i~. ~e Ja~e ~e d~natin~ the ~ry chi~. you l~k ~t ~ ~der m ~c~o~ ~ey are very r~ulmr, ~st~c chi~. · There's a m~rvelous metaphor here. Their chips a~e ~ll Lined up in a nice little row and you can mkss produce fJ~ose chi~, but they only represent 10 percent or. 15 percent of the ma~ket. The rest of the cht~ are very · ~xo~ic, oddly sh~.Ded chips wit]~ th~ngs wsa~dering all ove~ the plaz~e. en~ly, we're doing much better in this arem ~h-u the Japanese s. re. You make them in lesser qua~l~ity, but they h~ve & much higher value added and much ~re intelligence in them. We stil~ dominate tha~ field. So we're do[ag very well. While the Jape_nese .are taking over %he ~ry c. hip, which is lined .up and regular, we're dcznin~ting the thing that's irre~lar and ianov&~ive. 21 is sof t,~re a cottage industry?. DR. DAVID BIit~: Softw-~re is essentially m cott~e ~nd~t~y. It's m)t e~ily cop[~, it's not ~ ~ol~y that the J~e~ ~n ~mb ~ ~eplt~:e tn la~e q~tities ~us~ i~'s like a [l~in~ stre~ ~the~ ~n m ~nd. capitaliz~ ~d gover~nt su~idiz~ and ~rld d~t~ ~e ~y the pr~uc- tion of a pi~ of ~w~e ~. In ~t ~, over the next five or ~n y~ ~ ~ll ~ in at l~t ~ strong a ~sition ~ the Ja~ ~~ we're v~y g~ ~t ~t ~nd of ~ing ~nd ~ey're not. ~ ~ey.l~k ~ ~ clob~rin~ ~ in ~ 1~ d~ai~ ri~ht-n~, l~e ~u~biles ~d ~ m~ry chi~ ~d winches ~r~ps, but in ~e p~uction of intelligence going in~ tho~ ~chines ~ l~k ~ ~ ve~, v~ strong. I h~ked vt ~e history of Nobel Prizes recently. Of the 168 Nobel Prize~ tn science and medicine .,w~rded since 1950, 93 of those went to Amerlc~ns, Europeans got C~B ~nd. the Japanese had two. · They &re perfect cop[ecs but vct'y ~(x~l [nm)v~to~.~. N(~v y()~! ~'~t~ wr~te .~x~ne o~ that off to r~cisn on thru. ~%rt of the Not~l Ccnmtlttee, but not all of Lt. The Japan~se ,".re shnply ~ natYon of Lndlv[dual thinkers ~nd innovators mid we ~re. In the long m~n ti~ will ~ our strength, ~d we will ~ ve~ happy ~ ~ve the Ja~e~ ~ke, on m w~ry c~t-efft~tive ~[s,. the thins tt~t we create. I don': think ~I~t's a ~nflictlng relationship. I ~hi~k it's a very c~pl~n~ry. one. ~is ~uld ~ hereti~ ~ ~y tn the pre~nce of ~one fr~ Micht- g~, but I'm..b~ppy ~ ~ve ~em m~e ~ ~ for ~ ~%~e I don't ~hLnk my chil~en ~%t ~ ~e ~rs. LEE SKEql\StN DREYFUS: Don't fly back 1:brough Detroit. ~R. DAVID BIRCH: If we can finally discover robots in ~he mutcrnobile industry, which ap~ently ~e a~ ~at hesitant to do, we ~y ~ ~)te b~ do what we did tn ~%cultur~[f we could ~uce the l[~r force, ~e c~lld suI~nt[ally out-p~uce the ~rld in the ~uct. There '~n't ~ ~ny ~ple doing ti, but ~ co~d ~ very g~ at it by bringing ~re [ntel- l t~,~nc, b) ~r on ~e p~e~. I would ~ opt~tstic a~t that f~ ~ tr:~e ~)[n~ of view. I'm not opthnistic ~ut [t fr~ ~ ~lo~nt ~lnt ,~f view. ~e~fore, I think ~chigmn ~d other plmces %~1~ ~ve ~ l~k ~ othur %hin%s ~ ~p their ~ple ~y. TWIN LABOR CITIES MARKET INFORMATION LABOR FORCE CONDITIONS Vol. 6 No. 5 May 1982 The unemployment rate in the Minneapolis-St. Paul SMSA continued to rise slowly in March. While the increase was small, it is somewhat unusual for the unemployment rate to rise between February and March. Generally, the number of unemployed workers will fall if activity in seasonally-sensitive industries such as construction ex- pands. This year, however, there was very little movement in the level of construc- tion unemployment and, as the table on page three suggests, there were additional layoffs in nearly all industries. The only time the unemployment rate has been high- er in March was in 1976 when it was 6.1 percent and there were 58,300 unemployed .workers. Historically, labor market conditions in the Twin Cities and the rest of Minnesota improve significantly between March and April due to seasonal employment growth. Over the past twelve years, the only year in which the unemployment rate increased between March and April was in 1980. 'At that time, credit restrictions were put in place which caused interest rates to soar and severely curtailed construction activ- ity. Preliminary figures indicate that the number of Unemployment Insurance clai- mants in April has remained at nearly the March level. Consequently, no significant drop in the level of unemployment is anticipated in April although the unemployment rate m~y dip slightly. LA~OR FORCE ESTIMATES (n~t se&sonally adjusted) AREA CIVIL[AN LABOR FORCE TOTAL E/4PLOYHENT UNE~LOYI~NT UKEI~LOYI4~[T RATE Mar. Feb.e Mar. Mar. Feb.o Mar. Mar. Feb.o Mar. Mar. Feb.~ Mar. lgSZP lg82" Ig81R 1982P Ig82" 1981R lg82p lg82~ lg81R lg82F lg,82~ lg81R, #lnneapol is- St. Paul S#SA' 1,144.9 1,134.0 1,138.3 1,076.1 1,067.2 1,081.0 68.8 66.8 67.3 6.0 5,g 6.0 Count),: A.oka 108,917 107,637 108,326 101:875 101,027 102,332 7,042 6,610 6,993 6.5 6.3 S.S Carver 20,682 2O,SO0 20,406 19,266 19,0~S 19,342 1,326 1,405 1,063 6.4 6. g S.2 Chtsago 14,647 14,473 14,532 13,367 13,266 13,427 1,280 1,217 1,105 8.7 8.4 7.6 Dakota 108,~48 108,070 105,541 I00,8~4 100,064 101,347 6,062 6,016 S,1~4 5.7 S.7 4.9 He~neptn 518,838 513,459 515,855 489,322 4~5,250 491,516 29,514 28,209 24,339 S.7 5.5 4.7 Ramsey 264,644 251,634 263,110 238,~]4 236,996 240,056 15,0~0 14,639 13,054 5.9 E.8 6.2 Scott 24,547 24,405 24,236 22,758 22,568 22,8~0 1,789 1,837 1,376 7.3 7.5 6.7 ¥&shlngtOe 62,790 62,163 62,074 59,031 68,540 59,296 3,759 3,623 2,778 6.0 5.8 4.5 Yrtght 33,597 33,448 33,169 30,646 30,393 30,784 2,951 3,066 2,376 6.8 9.1 7.2 City of Nimeapolls 208,220 203,850 204,540 192,811 191,20~ 193,676 13,409 12,644 10,8M 6.S 6.2 6.3 City of St. Paul 150,126 148,744 149,808 140,459 139,290 141,089 9,K7 9,454 8,711 6.4 6.4 5.8 #1~aesata* 2,097.6 2,080.1 2,101.1 1,935.1 1,919.5 1,962.3 162.4 160.6 138.8 7.7 7.7 6.6 Lkll ted States* 108,761 100,324 107,634 98,471 97,~46 99,364 10,290 10,378 8,270 9.6 9.6 7.7 I!11 P - Preliminary R - ~vlsed U.S., Minnesota, and SI4SA d~Li tn thousands. EP. oLOYMENT, HOURS AND EARNINGS in the Minneapolis-St. Paul Metropolitan Area PERCEIfr PRODUCTION WORKERS' HOURS & F.J&RNINGS-2/ EMPLOYMENT CHANGE , INDUSTRY (008) FROM Average Weekly Average Hourly Average Weekly Earnings Emrnlngs I(our$ Mar. Month Year Month Year Mar. Month Mar. Month Mar, Month 1982 Ago Ago Ago Ago 1982 Ago 1982 Ago 1982 Ago TOTAL NONAGRICULTURAL 1072.4 1070.5 11085.3 0.2 -1.2 XX XX XX XX XX XX MANUFACTURING 237.4 237.3 241.3 ** -1.6 367.46 1365.34 9.35 9.32 39.3 39.2 Durable Goods 152.1 152.2 157.0 -0.1 -3.1 368.52 368.52 9.19 9.19 40.1 40.1 Lumber & Wood Products 3.4 3.7 4.6 -7.6 -24.9 351.08 332.62 10.48 9.87 33.5 33.7 Furniture & Fixtures 1.6 1.5 1.5 2.2 4.9 271.52 265.30 7.87 7.78 34.5 34.1 Stone, Clay & Glass 2.7 2.6 2.8 3.7 -1.g 362.17 347.38 9.03 9.07 39.0 38.3 Primary Metals 3.9 4.0 4.8 -4.7 -19.0 313.02 315.47 8.46 8.28 37.0 38.1 Fabricated Metals 26.6 26.4 27.9 0.6 -4.8 432.97 434.78 10.26 10.23 42.2 42.5 Non-Electrical Machinery 62.5 62.6 65.1 -O.1 -4.0 368.95 371.33 9.27 9.33 39.B 39.8 £1ectrlcml Machinery 18.5 18.4 18.2 0.3 1.6 342.32 339.83 8.17 8.13 41.g 41.8 Transportation Equllxnent 3.7 3.8 3.4 -3.9 6.9 458.60 460.99 11.85 11.76 38.7 39.2 Other Durmblesl_/ 29.3 29.0 28.7 0.7 1.8 334.00 328.44 8.35 8.40 40.0 39.1 Nondurable Goods 85.3 85.1 84.3 0.2 1.2 365.36 360.99 9.64 9.55 37.g 37.8 Food & Kindred Products 18.8 18.6 17.7 0.8 5.9 342.04 339.26) 9.17 9.12 37.3 37.2 Textiles & Apparel 2.8 2.8 3.3 -0.5 -14.9 205.98 204.40 6.28 6.27 32.8 32.6 Paper & Allied Products 24.1 24,1 24.0 ~ 0.5 400.75 393.95 9.68 9.47 41.4 41.6 Printing & Publishing 24.0 23.9 23.1 0.3 3.5 370.27 364.98 10.64 lO.B1 34.8 34.4 Chemical Products 6.3 6.4 6.2 -1.3 1.O 359.95 371.70 9.65 9.58 37.3 38.8 Petroleum Products 1.4 1.3 1.4 5.8 0.0 478.25 503.79 ll.S8 lq.gl 41.3 42.3 Rubber & Leather Products B.O 8.0 8.6 0.0 -6.8 347.69 336.59 8.78 8.72 39.6 38.6 NONMANUFACTURING 835.0 833.2 844.0 0.2 -1.1 XX XX XX XX XX XX CONSTRUCTION 31.2 30.6 36.1 1.9 -13.4 504.31 516.53 14.45 14.55 34.g 35.5 Building Construction 9.4 9.4 ll.O 0.2 -15.0 491.32 500.42 13.61 13.7l 36.1 36.5 Highway & Heavy Construction 1.9 1.8 3.2 6.1 -40.0 392.18 399.09 12.45 12.55 31.5 31.8 Special Trades Contracting 19.g 19.5 21.8 2.4 -B.7 518.65 533.03 14.99 15.10 34.6 35.3 TRANSPORTATION 40.9 40.7 41.7 0.6 -1.9 XX XX XX XX XX XX Railroads 7.1 7.1 8.0 -0.4 -11.8 463,57 463.57 9.78 9,78 47.4 47.4 Trucking & Warehousing 14.0 13.7 13.9 2.3 0.9 449.07 442.99 12.17 12.17 36.9 36.4 PUBLIC UTILITIES & COF~. 20.6 20.6 20.9 0.3 -1.2 434.071 435.57 11.13 11.14 39.0 39.1 TRADE 263.9 263.8 265.3 *~ -0.5 219.30' 217.26 7.19 7.10 30.5 30.6 Retail Trade 190.6 190.2 lgO.g 0.2 -0.2 168.64 170.47 6.11 6.11 27.6 27.9 General Merchandise St~res 32.6 33.3 32.5) -2.2 0.2 160.38 159.02 5.79 5.72 27.7 27.8 Food Stores 25.8 25.g 25.6 -0.6 0.8 215.73 217.15 7.65 7.54 28.2 28.8 Eating & Drinking Places 61.5 60.8 62.0 1.O -0.9 100.79 104.17 4.44 4.49 22.7 23.2 Wholesale Trade 73.3 73.6 74.4 ~0.4 -1.5 380.72 366.67 9.59 9.33 39.7 39.3 FINANCE, INS. & ILF-RL £STAT)E. 72.8 72.9 71.7 -0.3 1.5 Finance 30.8 30.7 30.0 0.3 2.5 Insurance 28.9 29.1 29.1 -0.9 -0.7 Real Estate 13.1 13.1 12.5 -0.2 4.4 SERVICE & MISCELLANEOUS 245.9 244.7 245.6 0.5 0.1 Business & Personal Services 59.4 58.7 61.1 1.2 -2.7 Repair Services 12.2 12.3 12.3 -0.7 -0.7 Medical Services 73.1 72.8 71.6 0.4 2.1 Hospitals 32.3 32.2 31.9 0.2 1.2 Nursing Homes 19.7 19.6 19.9 0.4 -1.0 GOVERNHENT 159.8 159.9 162.8 -0.1 -1.8 Federml 18.2 18.3 18.5 -0.4 -1.4 State 47.9 48.0 48.5 -0.3 -1.3 Local 93.6 93.6 95.7 0.1 -2.2 ** Less than .OS l_/ Includes Scientific Instruments and I~tscellaneous Manufacturing 2_/ Average earnings data are on a 'gross" basis and are derived from reports of payroll for full- and part-tine production or nonsupervisory w~rkers. The payroll is reported before deductions of any kind. Bonuses, retro- active pay, tips, payment in kind, and "fringe benefits' are excluded. Source: Current F_mployeent Statistics Program (Figures rounded to nearest hundred) EMPLOYMENT AND EARNINGS CONDITIONS The total number of nonagricultural wage and salary jobs in the Minneapolis-St. Paul metropolitan area increased in March but not by as much as would be expected. Al- though the start of a sustained economic recovery may be several months down the road, it was encouraging to see that there was little change in the overall number of manufacturing jobs and that the number of jobs in construction rose. The increase in construction jobs was below normal, probably due to high interest rates and lin- gering cold weather. The length of the average workweek for production workers in manufacturing, on a seasonally adjusted basis, slipped from 39.2 to 39.1 hours in March signaling that weak product demand still remains in that sector of the economy. There was very little change in the number of jobs in the rest of the nonmanufactur- ing sector when seasonal factors are taken into consideration. The diverse service sector showed the most growth over the month. On the other hand, retail trade, fin- ance, and government employment were basically unchanged. In typical years, the overall job picture should receive a welcome boost from 'the seasonal upswing in the economy which takes place in April. In the past twelve years, the number of jobs has increased between March and April by an average of 1.3 percent. Most of the increase takes place in the construction, retail trade, and service industries. Although some increase in jobs is again anticipated this April, it appears that the recession will restrict the seasonal growth in construction and retail trade, and the manufacturing sector may still experience job cutbacks. CHARACTERISTICS OF PERSONS CLAIMING UNEMPLOYMENT INSURANCE For the sixth consecutive month, the number of unemployment insurance clai- mants increased. The monthly increase of 1,702 claimants, or 5.5 percent, compares to a past three year average decrease of -3.1 percent. Almost 50 percent of the monthly change was ac- counted for by two industries-services registering 386 additional claimants and nondurable goods manufacturing with 395 additional claimants. Year ago comparisons make the picture look even bleaker, with claimant counts increasing by 25.4 percent, or 6,611 additional claimants from March, 1981. While all industries and occupations show increased levels from a year ago, the largest increases occur in ser- vices {1,445), retail trade {922}, and manufacturing {2,732). Largest manufac- turing increases were in nonelectrical machinery, lumber and wood products, and fabricated metals. Preliminary counts indicate claimant levels will decrease, lng the normal seasonal trend. April's follow- Xndustry and Occupational Attac)mmnt To~l, All Industries Construction ~nufacturtng Durable Goods Nondurable Goo~s Trans., Co~m., and Public Utilities Wholesale Trade Retail Trade Fin., Ins., and Real Estate Services Public Admtn. All Other Inf. Not Available Total, All Occupations Prof., Tech., Mgr. Clerical Sales Service Farm., For., Fish. Processing l&achtne Trades Benchwork Structural Work Miscellaneous Inf. Not Available CHARACTERISTICS OF THE IKSU~D UNE)4PLOYED (Regular Benefits.Program) MINNEAPOLIS-ST. PAUL SMSA Week Endtn9 3/13/82 Percent C~nge F~: Percent '1 Long-Term~ Percent Un~pl oynd W~en 24.0 25.4 19.0 3.3 26.5 32.2 29.6 27.4 19.3 43.1 17.6 23.3 23.0 30.2 27.0 34.g 3g.7 1.2 24.0 29.0 27.2 28.0 25.1 40.1 22.2 24.7 27.9 19.0 20.7 27.S NOTE: Percentages may not total to 100.0 due to independent rounding. 1_/ Long-Term unenployed refers to unenployment insurance claimants whose current spell of unemployment has lasted 15 weeks or longer. MARKET The results of the 1982 Twin Cities Area Wage Survey conducted by the Bureau of Labor Statistics were released recently. The survey covered January 1982 pay.levels for 42 typical occupations in four major groups - office clerical, professional and technical, maintenance, and custodial and material n~vement. The data were collect- ed from 241 manufacturing and nonmanufacturing firms employing 50 or more workers. The table below compares the increase in pay rates for the major occupation61 groups from 1972 to 1981 with changes in the Consumer Price Index for the Minneapolis-St. Paul SMSA. Percent Increases in Average Hourly Earnings]/ Occupational Gre.up 1972-73 1973-74 1974-75 1975-76 1976-77 1977-78 1978-79 lg7g-BO 1980-81 1981-82 Office clertc~l Co~uter related Skilled mtntenance Unskilled plant Minneapolis-St. Paul CPI2-/ Source: S.1 6.2 8.6 7.7 7.9 8.0 8.6 9.1 11.6 9.2 I~ I~ 8.4 6.5 5.5 7.3 8.$ 9.7 lO.O 8.9 6.8 6.4 9.2 8.1 8.7 8.2 8.3 10.4 11.7 9.7 6.8 6.1 9,3 7.7 8.9 8.1 8.1 10.8 11.1 8.0 3.2 9.8 11.3 7.0 5.3 8.3 10.5 12.3 9.5 17.4* Earnings are for & regular workweek for which employees receive their straight-time salaries, exclusive of any pay for overtime. CP! for January. Starting in 1978-79, .CP! for February. Stettstical aberration in housing component. CP! for all items less shelter equals 6.6 percent change. U.S. Department of Labor, Bureau of Labor Statistics. A complete report, Bulletin 3015-2, containing tables which provide the mean, medi- an, and middle range as well as the distribution of workers by selected earnings in- tervals will be available for $3.00 from the Bureau of Labor Statistics, 230 South Dearborn Street, Chicago, ITlinois, 60604. The report also contains earnings data by major industry division, sex, and company size. MINNESOTA DEPART~NT OF ECONOMIC SECURITY APPLICANT C~AR~CTERISTICS AHD CONDITIO~ MI~E~OLIS-ST. PAUL S~A ~R~ 1982 ~TIO OF EXPERIENCED APP~S ~CUPATIOq EXPERIENCED APPLICANTS TO UHFILLED JOB ~EHI~S % Change of 1981 Totel App. Total F~le Minority fr~ ~nt~_.Ago ~r. June Sept. ~c. Feb. ..~r..._ Total, Al! ~cv~attons ~,353 15,033 4,B13 16.4 7.8 10.5 ~.6' 8.9 6.8 7.1 Professio~l, TKhntcal, ~gertal 5,~5 2,158 ~6 ll.6 ~.6 8.9 10.8 12.1 9.4 Clertcml 7,014 5,574 750 16.4 7.5 9.5 g.2 8.6 6.9 7.4 hles 1,6~ ~6 92 16.4 3.3 4.0 3.3 4.3 3.0 2.0 Settee 6,2~ 3,293 1,2~ 14.3 9.7 ll.7 8.2 4.0 3.6 3.2 Faming, Foists, Flshlq 537 lll 103 16.5 1.7 2.1 0.4 ll8.0 1.1 ~.8 P~st~ 770 lB3 129 15.1 1.6 12.0 9.8 ll.g 10.6 ll.7 ~cht~ lredes 3,037 463 ~ 16.g 23.9 16.g 13.2 23.3 19.2 Be~rk 2,8~ 1,~6 470 16.3 19.6 15.9 ll.9 17.4 16.6 16.4 St~ctural 4,025 195 379 27.5 lB.1 20.4 9.8 24.4 19.4 24.4 ~tor F~lght, Trans~rtation 1,728 92 131 17.5 16.4 14.4 11.6 21.2 18.9 18.~ Packagl~, ~terlal ~ndltq 4,274 ~6 696 16.5 9.0 26.3 2.6* 14.1 11.3 12.S Other 317 ~ 29 14.0 25.8 26.6 6.4 14.7 ll.1 15.9 Source: ESARS Table 96 * Ratio is much s~naller than usual because of temporary State Fair openings included in 'Packaging, ~aterial Handling' category. IN THIS EDITORIAL, DON CARLSON SAYS ALL THE THINGS HE TOLD ME OVER THE PHONE BUT DID NOT PUT IN HIS LETTER TO THE CITY. VERY LIBERAL USE OF FACTS AND FIGURES, I THOUGHT. Page 4A--Sun Newspapers--Wed., May' 12. 1982 --' '-all. ~' ...~u~J'~ · ~----~- .. o the Editor., ,. : · .-, :,..:-.': ,. hurx The entrance from the lake terest differential. Off-street park-. ,~ ' As a public: employe6' ~nd a"~_(~ is restrictive~ It: would force ing ~vould require the removal of. =,Citizen,. I challenge the' March 31'~:ilbeai~hingon privatelands or possi- considerable material and the con- Viewpoints article , "And. finally., bly cause ;injury or a drowning in structi0n of a retaining wall to , some justice for all.... _..: ~: : ,. '.'C the mayhem that would follow .... ~::' protect the adjacent property.- ',..,~ I am Donald M. CarlSon, specml? , Let's look at the.area where'the'.,': Cost: Approximately $247,000.' assistant to th(~ommissioner, Min,::.~;'Parking lot and ramp Would have to '. This is an exhorbitant 'amount for a' nesota Dept. o~ Natural Resources,;t~ be located, The' staging area must'~'.-public access with a-maximum of ?.Trails and Waterways Unit.: ,~' ,:~.~ be dredged to allow'sdfficient'in~ 'eight parking sites, o.verflow park- ; It'is true the department~ W~s'~f~gress and egress to the ramp.:The'.: lng on a narrow road and irate ) forced intohaltingacquisitionplans-.?,Parking area 'Would have to be..-propertyownersbecauseofblocked":~ · for a public access .on Halsted's .'~,-placed upon the present, fill or addi-' driveways. · '" .- ' ; Bay, King's Point Road, Lake Min-~'~, tional fill would have to be placed in' ,: Let's compare th~se c~sts"and netonka. However, it was not be- '.' the wetlands. Furthermore, much., impacts to the proposed King's cause the DNR blundered..The, of the proposed area may have Point site'. ;:DNR was' ordered to halt.'the, buried' wastes that are ,objec- Cost: $122,700 acquis'itio~i, $30,000 development. No relocation costs, no interest differential. 25'to 30- parking sites, no off-site parking, no" destruction of wetlands, no filling or dredging, no removal of earthen material for 'the building of retain- ing walls. And finally "some justice for all." True justice must be accompanied by truth. Had the City identified the actual conditions and impacts of their alternatwes, people not for- tunate or affluent enough to own property on Lake Minnetonka would be more apt to' believe there was some justice for all. ~-Donald M. Carlson, special assistant to the commissioner, Dept. of Natural Resources Trails 'and Waterways' Unit, St. Paul. 'project,This was based upon alter-./~ tionable for a superimposed public ; natives presented by the City of ;..,,use;: ~--.' .' .... : Minnetrista On March24. "i~: ~. ~. -f" '.' Costs: If all the necessary per- Close' scrutiny of the alternativ~'~'\ ~nits'could be obtained for. dredging _ sites present far greater environ-.'.., and filling the wetlands, the project · mental, physical and. economical-: would exceed $250,000 for a max- i'problems than the King's Point ". imum of10 to12 parking sites. - ~ Roadsite: ~ ', ,-~ '-. Willlam's Street, Minnetrista: Lost Lake, Mound: The site is an' / This site is less than three-fourths of -extensive wetlandsarea:Thechan., an acre, including the present 'nel is shallow and narrow, The' launching area. Theprivateproper- channel bed is not public; someone ty' included in this small area is .owns the bed of the channel, mak- presently being offered for sale' for lng it necessary to acquire the right ',: $172,000. If the state were to acquire .to dredging even ff the necessary . only the private property, the regulatory permits could be ac-' purchase price would undoubtedly quired. The entrance to the channel be close to the asking price. Addi: , from the lake is restricted by berms tional acquisition costs would and bridge pilings, clude relocation and, if there is a What happens ff the weather mortgage on the property, the state forces the boaters off the lake in a would also have to absorb an in- ;... - ' r; 2. 3. 4. AGENDA Minnehaha Creek Watershed District May 20, 1982 Wayzata City Hall 7:30 p.m. Call to order; present, absent, staff. Reading and approval of minutes of regular meeting 4/15>82. Approval or amendment of May 20, 1982, agenda. Hearing of permit applications. A. 81-01 Robert E. Fisher- dredging in Lake Zumbra for boat access, City of Victoria. B. 81-34 PEMW Development Co., Inc. - residential subdivision referred to as "Red Oak Ridge" duplexes, City of Minnetonka. C. 81-40 Tom Gehl - construction of wood retaining wall, City of Minnetonka. D. 81-117 Dana Corporation - grading and drainage for Spicer Addition, City of Plymouth. E. 81-118 Darrel Farr Development Co. - grading and drainage for "Sunset Ridge", city of St. Louis Park. F. 82-14 City of Plymouth - Medina Road extension, City of Plymouth. G. 82-18 Rutledge Construction, grading and drainage for 6030 sq. ft., City of Long Lake. H. 82-21 Dick Conry - 40 lot residential subdivision on 93.34 acres, City of Orono. I. 82-23 Charlton Consolidated Companies, Inc. - 180 unit condominium development, City of Minnetonka. J. 82-31 R~ttinger Bros. Oil Co. - remodel old station, City of Long Lake. K. 82-33 Schlee Builders, Inc. - 48 lot residential subdivision, City of Orono. L. 82-34 Lawrence C. Freiberg - cut and fill to develop a residential lot, City of Chanhassen. M. 82-35 City of Minneapolis - replace an existing storm pipe, City of Minneapolis. N. 82-36 George E. Rector - 210 lineal feet of rip-rap, City of Orono. 0 82-37 Bruce Wheaton - 105 lineal feet-of rip-rap, City of Deephaven. 82-38 Beachside Developers - 5 lot single family~ residential and duplex subdivision, City of Mound, ~..~ 7e 10. 11. Qo 82-39 H.M. Baskerville Jr. and H. C. Lyman - regrading, seeding and mulching of the shoreline, City of Deephaven. Re 82-40 City of Minnetonka - site grading, excavation, City of Minnetonka. Se 82-41 city of Minnetonka - street grading and paving, City of Minnetonka. 82-29 William Hill - single family home, City of Wayzata. 82-43 William Hill.- dredging, widening and rip-rap of Gleason Creek, city of Wayzata. Correspondence. Hearing of requests, for petitions by public for action by the Watershed District. Discussion of meeting location. Reports of Treasurer, Engineer and Attorney. Acting Treasurer's Report- Mr. Thomas (1) Administrative Fund Report Be Engineer's Report - Mr. Panzer (1) CP-7 Contract Amendment - Status Report (2) Painter Creek Study - Status Report (3) 1982 WMRF - Board - initiated project (4). Control Structure Calibration Measurements Attorney's Report - Ms. Peterson (1) 1982 Legislation Unfinished Business.. ae B. C. D. E. F. Rule and Regulation Revision. District Initiated Maintenance Projects Bridge Obstruction Draft Permit Application Guidelines Headwaters Control Structure Management Policy Hydrodata and Water Quality Monitoring Program Evaluation and Proposal/January 1982 New Business. Adjournment. IIIq NOTICE REGARDING PROPOSED MODIFICATIONS TO HEADWATERS CONTROL STRUCTURE/MANAGEMENT POLICY The Board of Managers of the Minnehaha Creek Watershe~ District at their May 20, 1982 meeting will not take action on the proposed changes to the Management Policy for the Headwaters Control Structure. The Managers desire to conclude their information- gathering meetings with residents in various areas of the District before taking action on the proposed changes. WAFTA WESTERN AREA FIRE TRAINING ACADEMY CHANHASSEN CHASKA EDEN PRAIRIE EXCELSIOR MAYER VICTORIA LONG LAKE MOUND WATERTOWN MAPLE PLAIN ST. BONIFACIUS The April 21, 1982 meeting of WAFTA was called to order by Chairman Jerry Schlenk at 7530 p.m. at the WAFTA site. The minutes of the March meeting were read and approved. Treasurer's report: Checking account $ 47.10 Savings account 7,890.55 Bills$ WAFTA women $ 25.00 NSP 319.85 Earl W. Day & Sons 238.00 Continental Telephone 134.76 John McCoy 10.00 A motion was made by Mound and seconded by Maple Plain to pay the bills. C~rried. A survey questionnaire from'Continental Telephone System was discussed. The questionnaire wanted to know whether or not WAFTA, as a user of the phone system, wanted to have a metro line added to the present phone service. The secretary was instructed to answer yes to the questionnaire. Jerry Schlenk reported the Gas Company has started training and estimates to train 1500 people in 1982. Jerry indicated NSP has changed Fire Training Instructors. The U.S. Army is still interested in renting a silo but they have not made any decision yet. The School Committee reported there will probably be two schools at the site this summer but that additional work is needed regarding the school subjects and coordination with Bill Quirk from the G~s Company. The Grounds Committee was instructed to appoint each member fire department a certain area to clean up, pick up, etc. Below is a listing of the member departments and the area they should take care of: Chanhassen Building A Kitchen Chaska Bud_lding C Fallout Building Eden Prairie Building D Mower Building Excelsior Barrels of oil, remains of burnt buildin~ Long Lake Level out dirt areas Maple Plain Geaeral pick up of site Mayer Weeds in cracks in the tar Mound Sweep the tar and cement areas St. Boni General pick up of site Victoria Silo 2 Watertown Silo 3 This work should be completed in May or the first two weeks in June. The Building Committee presented the plans for the additional bathroom in the mower building. Lyle Day was instructed to get estimates for completing this project. WAFTA WESTERN AREA FIRE TRAINING ACADEMY CHANHASSEN EXCELSIOR MAYER CHASKA LONG LAKE MOUND EDEN PRAIRIE MAPLE PLAIN ST. BONIFACIUS VICTORIA WATERTOWN - page 2 - Lyle Day reported there is a break in a pipe in the kitchen building and made some suggestions on repairing it. A motion was made by Eden Prairie and seconded by Excelsior to repair the pipes as su6gested. Motion carried. Jerry Schlenk reported the Gas Company would like to hire a person for custodial work in their building. It would be for 4 or 5 hours per day for $5/hr. If anyone knows of someone interested in a job like this, have then call Bill Quirk at 935-2363. Member cities not represented at his meeting were Mayer, Mound, and Victoria. The next meeting will be May 19, 1982 at 7s30 p.m. at the WAFTA site. ~ spe ctfully submitted, John A. McCoy d Secretary-treasurer American Water Works Association I 6666 West Quincy Avenue I Denver, Colo. 80235 I 303 794-77' May 1982 Mound Water Department 53#1 Maywood Road Mound, MN 55364 Congratulations on your utility's outstanding safety record for 1981. By comPleting the year without a single disabling accident, you have provided a great benefit not only to your utility but to'the industry as a whole. I know I speak for the officers and directors of AWWA as well as for the section officers and aafety chairrnen who have worked so hard to achieve an industry ~vide safety performance improvement. The Association's Accident Prevention Committee, supported by section safeW chairmen, is expanding its program to provide better opportunities for everyone to reduce accidents. Your continued emphasis on all the aspects of safety and support of AWWA will be of individual and industry wide benefit. Congratulations again, and keep up the good work. Kenneth J. Miller President President: KENNETH d. MILLER, Denver, Colorado President-Elect: JOHN H. STACHA, Dallas, Texas Vice-President: WlLLIAMO LYNCH, Cazenovia. New York Immediate Past-President: JEROME B. GILBERT, Oakland, California Tre~.:ure¢: THOMAS J. BLAIR, III. Charleston, West Virginm E~¢;cut¢;.e D¢rector' DAVID B PRESTON, Denver, Colorado ll.', l Hennepin County Park Reserve District 3800 County Road 24 * Maple Plain, Minnesota 55359 · Telephone 612-473-4693 PARK RESERVES BAKER CARVER CROW-HASSAN ELM CREEK HYLAND LAKE LAKE REBECCA MURPHY-HANREHAN' REGIONAL PARKS CLEARY LAKE' COON RAPIDS DAM EAGLE LAKE FISH LAKE JAMES W. WILKIE' MEDICINE LAKE SPRING LAKE* SPECIAL USE AREAS BAKER PARK GOLF COURSE CLEARY LAKE GOLF COURSE' HYLAND HILLS SKi AREA NOERENBERG MEMORIAL TRAIL CORRIDORS NORTH HENNEPIN TRAIL OER PARKS TASSO ISLAND WILD GOOSE CHASE ISLAND '~COTT-HENNEPIN PARK AUTHORITY BOARD OF COMMISSIONERS WILLIAM BARBEAU CHAIR MINNEAPOLIS WILLIAM E. GENTRY VICE CHAIR NEW HOPE JUDITH S. ANDERSON BLOOMINGTON SHIRLEY A. BONINE MAPLE PLAIN PHYLLIS CRIMMINS MINNEAPOLIS AMELIA M. DeMUSE MINNEAPOLIS CHARLES R. PIHL ORONO MALCOLM D. REID SHOREWOOD DONALD C. RINGHAM MINNEAPOLIS RAYMOND N. SEAGREN MINNEAPOLIS ANNE-MARIE SOLENSKY MINNEAPOLIS ~"-I'ON E. FRENCH SUPERINTENDENT & SECRETARY TO THE BOARD May 11, 1982 Mayor Rock Lindlan 5341Maywood Rd. ~und, MN 55364 Dear Mayor Lindlan: The structure of the Park Reserve District Board will undergo significant changes~on January 1, 1983 by legislative directive. The size of the Board will be reduced to seven members from the current eleven. Three members will be appointed from the membership of the Hinneapolis Park Board. The remaining Commissioners will continue to be elected from four suburban districts. However, the districts are to be redrawn based on population instead of the current method which uses geography as a basis for drawing district lines. It is this mandated redistricting plan that prompts me to write you at this time. The Park Reserve District Board has recommended a redistricting plan that will be the subject of a public hearing on Thursday, May 20th at the Crystal City Hall, 4141 Douglas Drive at 7:30 p.m. The plan is based on 1980 census figures and attempts to combine communities of similar interests. The plan would replace an interim plan which the Board had approved before the 1980 census figures were available. A copy of both is enclosed. I strongly encourage you as a public official to take a look at these plans and, if you desire, let us know of your reaction. Comments can either be made in person at the May 20th hearing, or may be submitted to this Board in writing before the hearing date. We look forward to hearing from you. My best, William Barbeau, Chair Board of Commissioners WB/af Enclosure PROPOSED PLAN HASSAN :ROW~. ;{ PAR'K MAP OF HENNEPIN COUNTY COON RAPIDS "DAM REGIONAL PARK · I -RECRE. ATIO CORCORAN ME01NA PARi~. ORO~ I t' I -- PLYt~OUTH GROVE' BROOKLYN DISTRICT 1ST 2ND 3RD 4TH CARVER PARK RESERVE POPULATION 140,914 143,375 1 44,764 141 ,407 JAMES W. WILKIE -. REGIONAL PARK STRICT T 2ND 3RD 4TH INTERIM PLAN CON SS ON R D STRICTS HENNEP~N COUNTY P' .. AR~ RESERVE.DISTR,,CT_ - MAP OF HENNEP!i~J COUNTY ,~',HASSAN I ' ·_:RECR.~,TI6,~ CO'CO'AN M~'DINA PLYMOUTH Ga'DYE PAR'K COON RAPIDS "DAM REGIONAL 8aOOKLYN CARVER PARK RESERVE POPULATION 145,501 141 ,142 143,219 140,598 OOD ,/ JAM[S W. WJLKIE REGIONAL //,~9 CITY of MOUND 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 BACKGROUND MEMO The Hockey Association has approached me about the possibility of securing a temporary 3.2 Beer License and a Gambling Permit for two separate fund raisers they wish to hold this Fall in the Ice Arena. My feeling is, that with Kindergarten moving over to Shirley Hills this Fall, the historic fact that actual school classes have been held on the site would no longer be a factor. Thus, I think the site would be eligible from that standpoint. Perhaps if the Council would want, we should ask Curt if there would be anything else that might prevent us from granting this request. Their goal is to raise about $1OO,000 in 1982 that could be used to finish off the bleacher area inside the Arena. At this point, they have collected pledges and donations equal to $803,000. An incredible effort, I think. JE:fc Date Bids will be Opened: Time Bids will be Opened: Under the authority in Internal Revenue Code section 6331, the property de scribed below has been seized for nonpayment of internal reve.nue taxes due from 2070 :'%" : ~ ~'~'; The property will be sold at public sale under sealed bid as provided by Internal Revenue Code section 6335 and related regulations. June lO: 19 82 !0:00 .am ~p~__'[ Place of Sale: 1~7 Federal Office ~!dLnq: 3rd & Was~n~ton Ave. So., 74i~ea~o~s, I~4 Title Offered: Only the right, title, and interest of S~fside Lnc. in and to the prope~y will be offered for sale. If requested, the Internal Revenue Se~ice will furnish information about possible encumbrances, which may be useful in determining the value of the interest being sold. (See the back of this form for fu~her details.) - That part of Su~!~_sion 2 of ~t !, Plat of Sub~-~s'ions 2, 3, ~nd' ~, Description o~ cf ~t l, Section 23, T?~,.ms~ 117 ]~t~.~. ..., ?~nge 2~ West, described as P~ope~y: follows: Co~encins at a r~z&nt in the Easterly ]~ne of ~ke Avenue as Shc~m ~ the Flat of Eo'~nd ~y Park, at a point 200 feet ~utheriy along said ]~ne fror. its_~t~%~o~__-_~_ .. v,ith the Southerly .... ~ ~-~ Chaom~n ~'~=_n-~__, also_ ~ov~ as Cha~~. Place; ~._nce Easterly parallel ¥~_th the Southerly ~ of Cham~n Avenue a ~s~nce ~of 135 fee' thence ~utherl~.oaral~el--~ vdth t~e~ Easterly ~ne of ~ke Avenue to th~.._ ~ke Shore; - thence Westerly along said ~ke Shore l~e to its intersection ¥~th the ~sterly ~ne of ~ke k~enue extended; thence Northerly along the ~sterly ]~ne of ~ke Ave~ae, ~nd the Easterly l~ne of ~ke Avenue extended to the po~t of begLmning. Properly may be Inspected at: 26?0 ~ =' . ~.'?,~a ~.~.: :~X/, Submission of AIl bids must be submitted on Form 2222, Sealed Bid for Purchase of Seized Bids: PropeAy. Contact the office indicated below for Forms 2222 and information about the prope~y. Submit bids to the person named below before the time bids will be opened. . Payment Bids must be accompanied by the full amount of the bid if it totals $200 or less. Terms: If the total bid is more than $200, submit 20 percent of the amount bid or S200, whichever is greater. On acceptance of the highest bid, the balance due, if any, will be ~Required in full ~:~¢¢~'~~,: v&t~ 2& bourn. A 1,~m Bid has been estab~she~. · Form of Ali payments must be by cash, cedified check, cashier's or treasurer's check or Payment: by a'United States postal, bank, express, or telegraph money order. Make check or money order payable to the Internal Revenue Service. Signature~ 4:~-~"~~ Name and Title(Typed) ~ Revem.~ e Off~, cer Address for Information About the Sale and Submission of Bids Room 157 Federal ~-'-=~-c, 3rd ~' '"-~"-~ ~-r= ~ l.~mnea~.alis, ~-~ 55401 Date ~;/'~ '7 ./R2 ._ Phone (6!2) 725-6236 Form 2434-A ~:.,l. ure of Title Tr, e Fight. title, and interest of the taxpayer (named on the front of this ~or.-~; and lo the properly is offered for sale subject to any prior valid ou~sta-,d,'r? morigages, encumbrances, or other liens in !avor of third parties against the taxpayer that are superior to the lien of the United States. All property is feted for sale "where is" and "as is" and without recourse against the Uni~,"d States. No guaranty or warranty, express or implied, is made as to the vail of the title, quality, quantity, weight, size, or condition of any of the property, or its fitness for any use or purpose. No claim will be considered for allowance or adjustment or for rescission of the sale based on failure of the property to con- form with any expressed or implied representation. Effect of Junior Encumbrances Sec. _6339(c). Effect of Junior Encumbrances. A certificate of sale' of personal Property given or a deed to real property exe- cuted pursuant to section 6338 shall discharge such property from all liens, encumbrances, and titles over which the lien of the United States with respect to which the levy was made had priority. Form 2434-A (Rev. 8-79) Rate. reddction urged after Continental's rise · Associated Press A $6.7 mill'ton rate increase put into effect by Continental Telephone Co. March 18 should be slashed almost in half, the Minnesota Department of Public Service said Friday. The de- partment recommended an increase. · of $3.6 million.'. , · The department represents the pub- lic at rate heartngs before the state , Public Utilities Commission (PUC), 'which sets the rates. Richard Auld, ! director of the agency, said the rec- ommendation for a cutback followed an extensive investigation into Contl- ~ nental's request. The PUC mdst issue a final order by Dec. 18. If the commission denies part of the increase, the.company will have to make refunds. Hearings. are scheduled June 21~25 and Aug. 2-' 6 at which the company will make its case and other evidence: will be en- tered. , ... The Department of Public Service. also will. hold a series of public meet- ings beginning June 1 at Lindstrom. Other hearings will be held in Isle, Two Harbors,' Embarrass~ Interna- tional Falls, Maple Plain, Atwaler, Elbow Lake, Blooming Prairie and Mo~lnd. Release on ~acetp% - Bob Carlson (61/) 296-7532 The Minnesota Department of Public Service (MDPS), representing the broad public interest in utility rate proceedings, has recommended a $3.1 million cut-back in proposed rates for customers of Continental Telephone Company. The department's position was announced by MDPS Director Richard L. Auld following the flling of staff testimony recommending that Continental's rate increase be limited to $3.6 million, about one-half of the $6.7 million requested by the company. MDPS staff testimony, which will be presented during evidentiary hearings in August, is based on extensive investigation conducted during the past six months by department analysts. In its testimony, MDPS proposes an overall rate of return of 1~.10% and a 14.7% return on equity, which would reduce Continental's allowed earnings by $2.5 million. The company is seeking an 11.21% return on rate base and an 18% return on equity. Other adjustments include a $750,000 reduction in allowed operating income, which includes changes in depreciation expenses. In addition to financial adjustments, the MDPS testimony proposes a consolidation of rate groups to minimize rate differences between communities and pricing of ex- tended area telephone service in compliance with rules of the Public Utilities Com- mission. MDPS testimony also recommends that the company's proposed connection charges for new service be reduced from $104 to $59.25. Continental Telephone applied for a $6.7 million increase in December, 1981, and proposed rates have been in effect, subject to refund, since March 18, 1982. The deadline for a final order from the Minnesota Public Utilities Commission is December 18, 1982. In addition to participation in evidentiary hearings set for June 21-25 and August 2-6, the Department of Public Service will also participate in public hearings to inform the public of the MDPS position in the case. Customers of Continental -more- I~.INNESOTA DEPARTMENT OF PUBLIC SERVICE Continental RaGe'Case "' '*" · ~ * Page two May 21, 1982 will have opportunity to express views regarding the company's rates and service during public hearings scheduled in the following communities in Continental's service area: LINDSTROM--Tuesday, June 1, 7L30 p.m., Chisago Lakes Senior High School, 24900 Olinda Trail. ISLE--Wednesday, June 2, 1 p.m., High School Gymnasium, Main and Mille Lacs Streets. TWO HARBORS--Wednesday, June 2, 7:30 p.m., High School, 405 Fourth Ave. S. EMBARRASS--Thursday, June 3, 7:30 p.m., Town Hall. INTERNATIONAL FALLS--Friday, June 4, 7:30 p.m, Senior High School Cafeteria, Eleventh Street. MAPLE PLAIN--Monday, June 7, 7:30 p.m, Elementary School, 5050 Independence Street. ATWATER--Wednesday, June 9, 1:30 p.m., High School Auditorium, Third and Wyoming Streets. ELBOW LAKE--Wednesday, June 9, 7:30 p.m., High School Auditorium, 411 First Street, S.E. BLOOMING PRAIRIE--Thursday, June 10, 1:30 p.m., High School Auditorium, 202 Fourth Ave. N.W. MOUND--Thursday, June 10, 7:30 p.m., Grandview Middle School Cafeteria, 1881 Commerce Blvd. Those unable to appear at hearings in person may send written comments for inclusion in the case file on any aspect of the company's rates and service to the Office of Administrative Hearings, 400 Summit Bank Building, 310 South Fourth Street, Minneapolis, MN 55415, citing Docket P407/GR-81-700. Continental Telephone Company, the largest non-Bell telephone utility serving Minnesota, serves more than 83,000 customers in 78 communities throughout the state. - 30 - TESTIMONY OF DERICK O. DAHLEN CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. (Docket No. P-407/GR - 81 - 700) BEFORE THE MINNESOTA PUBLIC UTI LITIES COMMISSION On Behalf of The City of Mound May 21, 1982 1 2 3 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 I - STATEMENT OF QUALIFICATIONS Q. Would you please state your name, address and occupation? A. My name is Derick O. Dahlen and my address is 500 E. Minnehaha Parkway, Minneapolis, Minnesota. My business address is 1700 IDS Center, Minneapolis, Minnesota. I am a manager in the consulting department of Peat, Marwick, Mitchell & Co. Q. Would you please summarize your experience in the area of public utility regulation? A. I have participated in regulatory engagements for both electric and gas utilities. These engagements have included presentation of testimony and supervision of field investigation including analyses of filings, preparation of testimony, exhibits, cross examination and briefs concerning rate base, operating income, rate of return, rate design, and cost allocation. In Minnesota Power and Light Company's filing for an electric rate increase before the Minnesota Public Utilities Commission (Docket No. E015/GR-81-250), I performed analyses, prepared testimony, and testified concerning excess capacity, decommissioning costs and rate of return. In Inter-City Gas Corporation's filing for a gas rate increase before the Minnesota Public Utilities Commission (Docket No. G- 007/GQ-81-300), I performed analyses, prepared testimony, and test- ified regarding revenue requirements, and class cost allocation. -1- 1 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 In Otter Tail Power Company's filing for an electric rate increase before the Minnesota Public Service Commission (Docket No. E- 015/GQ-81-315), I performed analyse~, prepared testimony, and testified concerning depreciation expense, opportunity sales, rate design and fuel oil inventories. In Otter Tail Power Company's filing for an electric rate increase before the Minnesota Public Utilities Commission (Docket No. E- 017/GR-80-277), I performed analyses, prepared testimony and testi- fied regarding allowance for funds used during construction. In Minnesota Power and Light Company's filing for an electric rate increase before the Minnesota Public Utilities Commission (Docket No. E-015/GR-80-76), I performed analyses, prepared testimony and testified regarding class revenue requirements and cost allocation. In Northern States Power Company's filing before the Federal Energy Regulatory Commission (Docket No. ER79-616), I performed analyses, prepared testimony and testified regarding cost allocation. In Columbus and Southern Ohio Electric Company's filing for an electric rate increase before the Public Utilities Commission of Ohio (Case No. 78-1438-EL-AIR), I supervised the engagement which included the issues of rate base, operating income, excess capacity and inclusion of CWIP in the rate base for the purpose of permit- ting the company to earn a current return. -2- 1 2 3 4 5 6 7 8 9 I0 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 In Interstate Power Company's filing for an electric rate increase before the Minnesota Public Service Commission {Docket No. E- 001/GR-78-1065}, I performed analyses and prepared testimony con- cerning a methodology for determining rate of return by class of customer. In Northern States Power Company's filing for a gas rate increase before the Minnesota Public Service Commission {Docket No. G- 002/GR-78-1052~, I performed analyses and prepared testimony related to cost of capital and rate design. Have you participated in any other engagements involving utilities? Yes. I am currently supervising a planning engagement for a poten- tial industrial cogenerator. I have conducted several engagements for the City of Shakopee related to its electric utility. I super- vised the financial evaluation of the retrofit of an electric generating facility in Moorhead, Minnesota to produce both electrz- city and thermal energy. These engagements included computer modeling of the financial per- formance of the utilities, rate design, load forecasting, evalua- tion of investment alternatives and valuation of electric and thermal outputs. I conducted an analysis, on behalf of the River Electric Associa- tion, of the Northern States Power Company filing for a wholesale -3- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 rate increase before the Federal Energy Regulatory Commission. The River Electric Association is a group of municipal wholesale custo- mers of Northern States Power Company ~Mlnnesota). Would you outline your educational backgroundY In 1~75, I received an M.B.A. Degree with emphas~s in ~inance ~rom the Colgate Darden Graduate School of Business Administration at the University of Virginia, Charlottesville, Virginia. From 1966 to 1968, I attended the Massachusetts Institute of Technology, Cambridge, Massachusetts. Please describe your professional background. In 1968, I started a computer equipment manufacturing company which was acquired by the Bendix Corporation in IN70. I remained the company's marketing manager until 1~7~. From 197~ to 1~78, I worked w~th two Companies in the Charlottesville area. At Ridge Electronics Corporation, a manufacturer of marine radar, I was director of operations---responsible for engineering and manufac- turing. As general manager of Charlottesville Hardware Company, a hardware wholesaler and retailer, I was responsible for all opera- tions. In 1978, I functioned as an internal consultant to Deluxe Check Printers, Inc. w~th the t~tle of assistant to the Vice- President - Finance. In that position, I developed a strategic planning process and objectives, and performed analyses of acquisi- tion candidates. From January 1979 to January 1981, I was a man- agement consultant with Touche Ross & Co. I joined the management consulting department of Peat, Marwick, Mitchell & Co. in January 1981. -4- 1 2 3 4 5 6 7 8 9 10 11 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 II PURPOSE OF TESTIMONY Q. What is the purpose of your testimony? A. The purpose of my testimony is to present the results of my analy- sis of the rate base and operating expenses of Continental Tele- phone of Mznnesota, Inc. ~the Company). Q. Would you please describe the scope of work performed by Peat, Marwick, Mitchell & Co. in this case? A. Peat, Marwick, Mitchell & Co. was engaged by the City of Mound to review the Company's filing, the Company's response to information requests and other documents prepared by the Company. Q. How is your testimony organized? A. My testimony is organized in the following manner: Section III Test-year Section IV Section V Rate Base Operating Expenses -5- III - TEST-YEAR 1 2 9 10 11 13 14 15 16 17 18 19 2O 21 22 23 25 26 Q. What test-year has the Company used in this filing? A. Mr. Maunder testified that the Company is using a 1981 test-year, adjusted for known and measurable changes occurring within one year. Q. Has the Company actually used a 1981 test-year? A. No. The Minnesota Pub£1c Service Commission has defined "test year" in PSC 400 ~P) as "the twelve-month period selected by the utility for the purpose of expressing its need for a change in rates". The Company has not calculated most rate base items and annualized revenues and expenses to a single point in time, 12-31- 81, instead of a twelve month period. In addition, the Company has made adjustments for selected changes outside of the test year, all of which increase revenue requirements. Q. Does the Company's proposed test-year provide a proper basis for setting ratesY A. No. The Company's proposed test-year Zs inappropriate for the following three reasons: 1) It zs not representative of the period for which rates will be in effect. 2) The adjustments proposed to the test-year .are ~ncomplete and outside the test-year. 3)It matches rate base, return and revenue projec- tions from differing time periods. Q. Why is the Company's test-year not representative of the period for which rates will be in effect? 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 A. This is primarily caused by adjusting items of revenue and expense to different time periods by a variety of methods. For example, payroll expense has been stated at 1982 levels while local service revenues are stated at year-end 1981 levels. It makes very little sense to then compare the two in a calculation of revenue deficien- cy for a rate-setting period because the different time periods make them incompatible and in the present case overstate revenue requirements. The Company's m~thod is also not representative of the rate-setting period becausa it utilizes arbitrary adjustments, such as the unit rule, to state certain revenues and expenses at annualized levels and completely ignores seasonality in adjustments to revenue. Q. Why are the Company's proposed adjustments to the test-year incom- plete? A. The Company has proposed changes in expenses and rate base which are, in their estimation, known and measurable. However, the Company has only proposed adjustments which increase revenue requirements while failing to recognize ad0ustments which reduce revenue requirements. The Company has increased rate base by committed construction for 1982 but has not reduced rate base for 1982 depreciation. The Company has ~ncreased payroll expense to reflect 1982 increases but has not done the same for 1982 revenue increases such as the expected toll settlements. Including only the adjustments which increase revenue requirements is wholly inappropriate. It would be far preferable to project all changes on a reasonable basis to avoid the bias zn the Company's proposal. -7- 1 2 4 5 6 ? 8 9 10 11 12 13 14 15 16 I? 18 19 20 21 22 23 24 25 26 Q. How does the Company's method result in improper matching ot return on rate base return and revenue projectionsY A. The Company's rate base containing 1982 committed construction and 1981 plant in service ~s being matched with projections of avail- able operating income which contain 1982 payroll expense and 1981 year-end revenues. It is unlikely that the results of this mixing of 1981 revenues, 1982 and 1981 expenses and 1982 and 1981 rate base will approxzmate the actual revenue requirements ot the perzod ~or which the rates w~il be e~tectlve. Q. What alternative test-years are available to the Commission in this case? A. Based on the information available in the Company's filing, the Commission could use either: 1) Historical year 1981, or 2~ Historica£ year 1981 adjusted to year-end revenue and, expense levels~ and year-end rate base. Either of these approaches is more appropriate than the Company's approach. Q. If the Company desires to reflect changes beyond the end of the 12/31/81 test-year, what approach should the Company tollowY A. It the Company deszres to re[lect changes beyond the end of the test-year, the Company should withdraw its current filing and sub- mit a rate increase request using a future test-year following the approach suggested by the Minnesota Public Utilities Commission ~n the Northwestern Bell Telephone Company rate case, Docket No. P-421/GR-77-1509 when it recommended consideration of the following -8- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 New York State Public Service Commission position {NY 1977) (22 PUR 4th 611): "Our goal in setting rates would be to ascertazn, as best we could what the utility's revenues, operating expenses and condltzons would be in the period for which we were setting rates: the first twelve months after the new rates became effective...And we find that our deliberations will be served best by a rate case ~lling conszst~ng o~ ~l) operating results, wzth norma£lzzng adjustments, for a 12-month period expiring at the end of a calendar qugrter no earlier in time than 150 days before the date of filing and (2) the projected operating results for the new 12-month rate period." Q. What is your recommendation regarding the test-year to be used zn th~s case? A. I recommend that the Company use as the test-year, calendar year 1981 adjusted to year-end normalized levels of revenue, expenses and rate base. -9- 1 2 6 7 8 9 10 11 12 13 14 16 17 18 19 2O 21 22 23 24 2~ 26 IV. RATE BASE Q. What rate base has the Company proposed in this case? A. The Company has proposed an end of test year, December 31, 1981 rate base to which certain adjustments have been made. Q. Do you agree with the Company's proposed rate base? A. No. The Conlpany's proposed rate base includes the following two components which should not be allowed: 17 Materials and Supplies, and 27 'Committed construction. Q. Why should materials and supplies be excluded from rate base? A. Materials and supplies should be excluded from rate base because the Company has not demonstrated that investor-supplied ~unds are required to ~lnance materzals and supplzes. In tact, Exhibit ~DOD-I} shows that the Company had negative cash working capital of $2,447,413 on December 31, 1979 and $1,144,843 on December 31, 1980. I have requested from the Company the data to prepare a December 31, 1981 estimate of cash working capital for considera- tzon by the Commzsslon in this case. Q. Should rate base be reduced when cash workzng cap~ta£ ~s negative? A. Yes. Negative cash work~ng capzta£ ~nd~cates an lntiux of non- investor supp£1ed tunds because lznanczng pr~vzded by current l~ab~lltzes exceeds uses to whzch these tunds are put ~n the form of current assets. The excess is a component of rate base which is supplied by creditors and should not be used as a basis for calculating investor returns. However, computation of cash working capital by using year-end amounts does not recognize seasonal or daily changes in the account balances that may affect cash workzng capital. -10- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 23 24 25 26 In order to overcome these problems, the Commission should order the Company to perform a lead-lag study before tiling its next case. Although a lead-lag study may be expensive to conduct, Exhibit [DOD-2> shows that revenue requirements would be reduced by $231,566 if rate base is reduced by $1,144,843 for negative cash working capital. Q. By what amount are revenue requirements reduced if materials and supplies are excluded from rate base? A. Jurisdictional revenue requirements are reduced by $108,9b3 if materials and supplies are excluded from rate base as shown on Exhibit (DOD-3). Q. 'What is the Company's rate base proposal regarding committed construction? ' A. The Company is proposing to increase its December 31, 1981 rate base for construction projects which it plans to undertake in 1982. Q. Do you agree with the Company's proposal? A. No. Committed construction projects should not be Included in rate base ~or the following reasons: 1) The dollar amount on which the Company desires to earn a return is not telephone plant during the test year, and 2) I~ net telephone plant is increased tot 1982 committed construction, the ~ncrease in committed construction mst be offset with decreases to rate base such as 1982 depreciation on net telephone plant. 1 2 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 25 Q. Why should the Company not be permitted to earn a return on 1982 construction when a 1981 test-year is used? A. Continental should not be permitted a return on plant which will not be in service and which will not exist in the test year. The property to be constructed will not be used and useful in the test year and the Company will not have znvested the ~unds required to construct these projects. Ratepayers should not pay a return on plant which is not used and useful, and investors do not require a return on capital which they have not invested. Q. What is the effect on revenue requirements of using the unadjusted 12/31/81 net telephone plant in the rate base computation? A. Exhibit {DOD-5) shows that revenue requirements are $612,324 lower than the Company's calculated revenue requirements when committed constructzon projects are not ~ncluded in rate base. Q. If the Company includes 1982 committed construction in rate base and also adjusts net telephone plant for 1982 depreciation, how much net telephone plant would the Company need to add to reach the $121,871,569 level proposed by the Company in this case? A. The Company would need to add at least $10,909,8~8 of telephone plant in 1982 in excess of committed construction to achieve a net telephone plant balance of $121,871,569 at 12/31/82, Exhibit (DOD-4). This demonstrates that zncludzng only commztted construc- tion in the zn the 1~81 rate base ~s dlstortive, particularly since service levels have improved and the Company is unlikely to add telephone plant at the rate it has in the past. -12- 1 3 5 6 7 9 10 11 12 13 14 15 16 17 18 19 2O 21 23 25 26 Q. What is your recommendation regarding the net telephone plant component of rate base? A. I recommend that the Commission use the end of test year, 12/31/81, balance of net telephone plant without any adjustments for events outside the test year. -13- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 V. OPERATING EXPENSES Q. Has the Company calculated all test-year revenues and expenses at an annualzzed 1~81 year-end level? A. No. Payroll expense was not calculated at an annualized year-end level. Regardzng the adjustment to payrotl expense, Mr. Maunder testified on cross-examination that "the beginning point was the known level of employment at the end of the test year. And I adjusted wage rates for those rates to be in effect at December 31st, 1982, approxi- mately the time the Commission will issue its final order in this proceeding. And I adjusted those rates that were in effect at the end of '81 for the actual increases granted durzng 1982." Q. Should payroll expense be adjusted for 1982 wage rates? A. No. Payroll expense should not be adjusted ~or 1~82 wage rates. The adjustment proposed by the Company occurs outside the test year. Using 1982 wage rates without using 1982 revenues results in a mismatch of revenues and the expense of producing those revenues. Q. What is your recommendation regarding operating expenses? A. Operating expenses should be reduced by ~1,U21,~14 to reflect lower test year payroll expense than used zn the Company's fzling. Ope~'ating income at present rates should, there[ore, be zncreased by $4~4,2/8 and jurlsdlct~ona£ revenue requzrements reduced by $1,021,514 as shown in ExhZbit ~DOD-6}. Does this conclude your testimony? qe Yes. It does. -14- Exhib it (DOD- 1 ) CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. DOCKET NO. P-407/GR-81-700 Calculation of Cash Working Capital Balance Sheet Approach 12/31/79 and 12/31/80 Current Assets Less: Current Liabilities Plus: Notes Payable Cash Working Capital 12/31/79 12/31/80 (1) (1) $ 7,245~283 $ 5,111~30 23,720~916 10~183,433 14~028,220 3~927,380 $(2,447,413) $(1,144,843) (1) Continental Telephone Company of Minnesota, Inc., 1980 Annual Report to the State of Minnesota, Department of Public Service, pages 10 and 11. CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. DOCKET NO. P-407/GR-81-700 Change in Revenue Requirements Resulting from Cash Working Capital Adjustment to Rate Base 12/31/80 Cash Working Capital (Estimated 12/31/80) Jurisdictional Factor Jurisdictional Balance Rate of Return Required Income Revenue Conversion Factor Change in Revenue Requirements $(1,144,843) (I) x .8o5o (2) (921,599) x 11.42% (105,247) + .4545 $(231,566) (3) (3) (1) Exhibit (DOD-i) (2) Company Exhibit DM-l, page 1 of 3 (3) Company Exhibit DM-3, page 1 of 1 Exhibit (DOD-3) CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. DOCKET NO. P-407/GR-81-700 Revenue Requirements Impact of Removing Materials and. Supplies from Rate Base - Test Year - Materials and Supplies Included in Rate Base Jurisdictional Factor Jurisdictional Balance Rate of Return Required Income Revenue Conversion Factor Change in Revenue Requirements $538,651 (1) x .8050 (1) 433,614 x 11.42%(2) 49,519 + .4545 (2) $108,953 (1) Company Exhibit DM-i, page 1 of 3 (2) Company Exhibit DM-3 Exhib it (ooo-4) CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. DOCKET NO. P-407/GR-81-700 Additional Plant Additions Required to Produce 12/31/82 Net Telephone Plant Equal to Company Proposed Net Telephone Plant Company proposed net telephone plant Net Telephone Plant 12/31/81 - per books Net 1982 Committed Construction Depreciation (1982) Telephone plant additions required $121,871,569 (1) (118,922,350) (1) (2,957,529) (2) ,, 10 plS,208 (3) $10,909,898 (1) Company Exhibit DM-i, page 1 of 3 ~ (2) Company Exhibit DM-i, page 2 of 3 (3) Company "Comparative Income Statement" provided in response to DPS information request #2. Exhibit (DOD-5) CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. DOCKET NO. P-407/GR-81-700 Change in Revenue Requirements Resulting From Exclusion of Committed Construction from Rate Base - Test Year - Telephone plant in service Telephone plant under construction Accumulated depreciation Net Telephone Plant Rate of Return Required Income Revenue Conversion Factor Change in Revenue Requirements Rate Base Adjustments (1) $(825,251) 3,031,008 751,772 Jurisdic- tional Factor <2> .8182 .8233 .8204 Juris- dictional ~djustment $(675,220) 2,495,429 6!6~7.54 2,436,963 11.42% (3) 278,301 .4545 (3) $ 612,324 (1) Company Exhibit DM-I, page 2 of 3 (2) Company Exhibit DM-2, page 1 of 6 (3) Company Exhibit DM-3 Exhibit_ (DOD-6) CONTINENTAL TELEPHONE COMPANY OF MINNESOTA, INC. DOCKET NO. P-407/GR-81-700 Correction to Annual Level Payroll Expense to Eliminate 1982 Wage Increases Company's calculation of annual level 1981 payroll (1) Jurisdictional factor (2) Jurisdictional increase 1982 Wage increases (3) Corrected annual level ~81 payroll 1982 wage increases (3) Adjustment to current annual level 1981 payroll Less taxes at 54.55% (4) Adjustment to annual level operating income Revenue conversion factor (5) Adjustment to revenue requirements Maintenance Traffic Commercial General Office $9,521,734 599,562 2,032,681 820,031 x .8175 x .8780 x .8702 x .8182 7,784,018 526,415 1,768,839 670,949 Total 10,750,221 +1.105 9,728,707 .105 1,021,514 557,236 464,278 .4545 $1,021,514 (1) Company Exhibit DM-2, page 4 of 6 (2) Company Exhibit DM-2, page i of 6 (3) 4/21/82 Testimony of Dennis Maunder, Volume VI, page 100, line 20 (4) 1 - conversion factor of .4545 per (5) (5) Company Exhibit DM-3 LAKE MINNETONKA CONSERVATION DISTRICT AGENDA Regular Meeting, 8 p.m., Wednesday, May 26, 1982 TONKA BAY VILLAGE HALL 4901Manitou Road (County Road 19), Tonka Bay 2. 3. 4. Call to Order Roll Call Minutes: April 28, 1982 Treasurer's Report A. Monthly Financial Report B. Bills Committee Reports A. LAKE USE COMMITTEE (1) Committee Report (a) Sp.Event Permit: Women Anglers (b) Sp.Event Permit: Antique Boat Parade (c) Sp.Event Permit Fees (d) 1982 Lake Use Study (e) 1982 Buoy Program (f) Water Patrol Quarterly Report (g) Water Patrol Report (h) Other (2) Action Items (a) Sp.Event Permit: Women Anglers (b) Sp.Event Permit: Antique Boat Parade (3) Other B, WATER STRUCTURES & ENVIRONMENT COMMITTEE (1) Committee Report (a) P.H. Report: Driftwood Shores (b) License Amendment: West Beach Apts. (c) 1982 Dock Licenses (d) Future Public Hearings (e) Rental vs. 4 Boats (f) Code Amendment: 3.08, Sub. l(b) (g) Other (2) Action Items (a) Driftwood Shores Variance & License (b) Dock License Amendment: West Beach Apts. (c) Dock License: Lakeview Restaurant (d) Dock License: No. Shore Drive Marina (e) Dock License: Kreslins (f) Dock License: Loring Acres Beach Assn. (g) Other (3) Other Other Business Adjournment 5-21-82 CITY of MOUND 5341 MAYWOOD ROAD MOUND, MINNESOTA 55364 (612) 472-1155 TO: FROM: DATE: SUBJECT: Jon Elam, City Manager Jan Bertrand, Building Official May 24, 1982 6639 Halstead Avenue, West Suburban Properties This is a progress report regarding 6639 Halstead Avenue - West Suburban Properties' Trailer Court. The complaint by the Inspection Department against West Suburban Properties charging them with building without proper permit went to pre-trial hearing on May 18, 1992. A jury trial date was set for August 3, 1982 with no negotiation settled at the hearing. Friday, May 21, 1982, Mr. Doug Klint, Attorney, contacted Desyl Peterson requesting the charges be dropped. I have requested that Desyl not drop the charges against West Sub- urban Properties. I have discussed the condemnation hearing with Jim Larson today. He is presently drafting a resolution to be adopted by the City Council as early as June I to have the buildings removed under the provisions of the hazardous building act. A.THoNI AS WURST GERALD T. CARROLL CURTIS A. PEARSON THOMAS F, UNDERWOOD ALBERT FAULCONER ]3~ JAMES D. LARSON LAW OFPIC£S WURST, CARROLL (~ PEARSON PROFESSIONAL A S S OClA'i'IO N IIOO FIRST BANK PLACE WEST HINNEAPOLIS, 1~4 I N N ESOTA 17, 1982 TELEPHONE (61~) 338-8911 Mr. Jon Elam, City Manager City of Mound 5341 Maywood Road Mound, Minnesota 55364 Re: Mound v. Bonhoff Dear Jon: Enclosed is the most recent communication from Richard A. Saliterman, Attorney at Law, representing Mr. and Mrs. Bonhoff. Please note paragraph (2). I do not believe we can give them legal title to the land on which the boaC house is located, since it encroaches on a public right-of-way. If we can get the insurance company involved, we can work on the money damages, but I hope that you and Jan will look at the encroachment problem and try to formulate some ideas about that situation. To do what Saliterman is asking is to in effect give them a permanent right to be on public lands, and it might be that one point ~ill force us to go to,. the mat. I certainly will appreciate your thoughts and comments on this subject. . Ver~ruly yo~, ~ Cc~It~-~nee~ s °~ ' CAP: ih Enclosure ATTORNEYS IqICHARD A. $ALITERMAN GEORGE: dOHN I~. ALDEN RICHARD A. SALITERMAN LAW FiRm SUITE 1420, SO0 LINE BUILDING FIFTH AND I~AIRQUETTE ~IlNNEAPOLIS, ~IlNNESOTA S5402 I~,l 2 j 339-1400 May 13, 1982 Mr. Curtis A. Pearson Attorney at Law 1512 First Bank Place West Minneapolis, Minnesota 55402 Damage to property of Steven R. Bonhoff and Victoria M. Bonhoff by City of Mound, legally described as Lot 18 except the Southeasterly 25 feet, front and rear thereof, and Lot 19, Block 1, Devan, County of Hennepin, State of Minnesota and otherwise known as 4687 Island View Drive, Mound, Minnesota; Our Office File No. 8110-97. Dear Mr. Pearson: This letter shall confirm our telephone conversation of today in which I indicated to you that my clients, Steven and Victoria Bonhoff, would be willing to settle the above-entitled legal action on the following basis: (1) The sum of $4,000.00 would be paid to them for damages they have sustained; (2) They would be afforded full, protected legal title to the property used as a boat house. As you are well aware, the claim of my clients is far in excess of the amount that they are willing to settle the case for prior to commencement of litigation. Accordingly, this settlement offer is extended for only a period of three (3) weeks from today's date. In the event that my clients commence litigation I am afraid that settlement of the rather small magnitude which is now offered will not be possible. This letter is not to be construed as an admission against interests or waiver of rights. As you are aware, my clients among other things have taken a position that an accord or agreement to settle claims Mr. Curtis A. Pearson May 13, 1982 Page Two has already been perfected for a sum substantially greater than the $4,000.00. Your careful and expeditious attention to this matter is appreciated. I do not think, as one attorney to another, I can bend over backwards any more than I have in an attempt to avoid needless expenditure of money, time, and emotion of all parties concerned. I trust that you recognize this fact. Very $inc~r~'~y yours, -× Attorney at Law RAS: jr cc: Mr. and Mrs. Steven R. Bonhoff GERALD T, CARROLL CURTf$ A. P:EAR$ON THOMAS F*. UNDERWOOD ALBERT FAULCONER 'm JAMES D- LAR$ON LAW OFFICES WURST, CARROLL ~S, PEARSON IlO0 FIRST BANK PLACE WEST MINNEAPOLIS, MINNESOTA 55~,0;~ May 13, 1982 TELEPHONE (61 :;') 338-8911 Mr. E. L. Sonnenburg Senior Claims Representative Aetna Casualty and Surety Division 110 S. 7th Street Minneapolis, MN 55402 Re: Bonhoff vs. City of Mound Dear Mr. Sonnenburg: You will recall that in the fall of 1981, September 8, 1981 to be specific, you wrote a letter to Mr. Jon Elam, City Manager, denying coverage to the City of Mound on a claim of Steven R. Bonhoff for damages to a boathouse. In that letter you gave two reasons for denying the claim, the first being a late notice, and the second your contention that the loss cannot be considered an occurrence. I have responded to those statements and have reviewed the policy and feel that your decision is in error for several reasons. First, there was no delay in reporting the claim because we did not know a claim existed, and as soon as the City found out that the Bonhoffs were making a claim for negligence on the part of the City, the Aetna was advised. The second point relating to the definition of an occurrence includes the wording, "including con- tinuous or repeated exposure to conditions which result in personal injury, property damage or advertising offense which is neither expected nor intended from the standpoint of the insured." It would appear that the situation under investigation here fits that defini- tion very precisely. Mr. Richard A. Saliterman is representing the Bonhoffs and I am enclosing herewith copies of his letters of May 12, 1982 and Decem- ber 11, 1981 along with a copy of the report from the Subterranean Engineering, Inc. concerning the boathouse. I do not know what the costs will be 'to complete their recommendations. I conferred with Mr. Saliterman on May 13, 1982, it being my intent at that time to indicate to him the City had some real difficulties WURST, CARROLL & PEARSON Mr. E. L. Sonnenburg Page 2 May 13, 1982 with this claim. First off, the City feels very strongly that this claim should be investigated and defended and if liability is determined against the City, paid for by the insurance company. The second point is that there are a number of factors involved here which may give either the City and/or the insurance company some defenses. The permit to construct this boathouse was taken out on July 14, 1960, and in the permit the property owner was told to put the boathouse on the right side of the lot, three feet from the lot line and off the commons. You will note on the survey which is attached to the letter I am sending you that the boathouse does encroach into the abutting property line and does not appear to be in compli- ance with the 1960 permit as to setbacks. Secondly, if the City is to defend the lawsuit, we will of course have to contend that there has been equipment operating in that area and the City is not sure what caused the seal in the pipe to come loose and allow the leak. Thirdly, there is the matter of damages as to what it will cost to rebuild the wall if it is the City's responsibility. There are a number of other things I am sure which will come up in the line of defenses. The negative side of the City's case is that the boathouse has been there for 22 years. Apparently the inspector who did the inspection, if there was one by the City of Island Park, did not reveal the encroachment on public property. The City will have difficulty in providing testimony because some of the people who were working for the City in 1978 and 1979 have left the City and have left the State. Fourth, we will have to acknowledge that there was a leak in the pipe, even though we didn't know that a pipe was located in that area and the City had no record of that storm sewer having been constructed by a predecessor city. The damage to the boathouse is also evident. Whether the cause of that damage had anything to do with the City's storm sewer pipe is another question, but the damages will be before a jury. Another problem in the defense is that juries are more apt to side with the individual against the governmental unit in these kinds of cases. Another problem will be that the City Council and the City Manager implied, to what extent I am not sure, that it was the City's responsibility and that it would be paid. Another point for both the City and the insurance company to consider is the ultimate cost of defending its principles by defending the WURST, CARROLL & PEARSON Mr. E. L. Sonnenburg Page 3 May 13, 1982 lawsuit. The City feels that any responsibility we may have should be covered by the insurance. It is going to be expensive to carry on litigation to prove that point and of course that will mean that we will have to join you in the litigation. I called Mr. Saliterman to discuss some of these issues on May 13. I also pointed out to him in that discussion that on August 14, 1981 in the case of Jasaka Co. v. City of St. Paul, 309 N.W. 2d 40 the Supreme Court in a somewhat similar case made some interesting find- ings. In that case a tower company constructed a radio tower 300 feet in the air when it was stopped by the City. The ultimate height was to be 330 feet. The questions involved in the case related to uses allowed in that particular zoning district, improper issuance of a permit by city officials, and refusal of the city to vacate the public land upon which the applicant had constructed one leg of the tower. The court indicated that a building permit issued in violation of the zoning ordinance does not vest rights if it is revoked as soon as the error is discovered, and stated: "where a permit has been issued. . . under mistake of fact and contrary to zoning ordinances, it confers no privilege. . and even though the party may have taken some action. . . with the incurrence of expenses, it may, nevertheless, be revoked." In this case the company had spent $67,000 in erecting the tower. The court made them tear it down and refused to require the City to issue a building permit or to vacate a portion of the unopened public street. The court also said: "We note in passing that with rare exception a City is not estopped from denying the unlawful functions of its own officials." During the course of my conversation with Mr. Saliterman it got rather hot and heavy and he hung up on me. I then started to pre- pare this letter and in the course of dictation, he called back after regaining his composure. The offer of $4,000 is still open. He will give the City two weeks to respond to his offer of settle- ment. In addition to the problems we have between the insurance company and the City, we have some other problems from a zoning standpoint. Wurst. CARROLL ~ PEARSON Mr. E. L. Sonnenburg Page 4 May 13, 1982 Under our zoning ordinance a non-conforming structure (such as this) can not be rebuilt and that appears to be the intent. At the very le~t they would have to replace this wall, which would mean that the use of this boathouse encroaching on public land would be perpetuated for some period of time into the future. If the insurance company is willing to participate in trying to achieve a settlement, I would recommend to the City a joint effort to dispose of the lawsuit. If at this time you indicate that you are going to stand by your denial, I would recommend to the City that they not pay the $4,000. I hate to make that kind of a recommendation, because I think it could very easily cost the City $4,000 in legal fees.which of course we would have to demand from the Aetna since we feel it is your responsibility to defend this. Mr. Sonnenburg, the long and the short of this matter is that be- tween the defendant and the City of Mound and the homeowner, we will all spend more in attorney's fees trying to prove a principle than the whole case is worth. I sincerely hope that the Aetna will be able to review its position on this matter and have a report to me prior to May 24, which hopefully will indicate your willingness to participate in a compromise settlement with the property owner. I can then discuss it with the City Council at its meeting on May 25 to see if the council will agree to participate in a settle- ment which will resolve this lawsuit. If you wish to discuss this further, please contact me and let us try to come up with a logical conclusion to a really small matter. Very truly yours, Cu~ii$' ~. Pearson City Attorney City of Mound CAP: ms cc: Mr. Jon Elam