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CC 2008 11 27 CHANHASSEN CITY COUNCIL REGULAR MEETING DECEMBER 8, 2008 Mayor Furlong called the meeting to order at 7:00 p.m. The meeting was opened with the Pledge to the Flag. COUNCIL MEMBERS PRESENT: Mayor Furlong, Councilman Litsey, Councilwoman Ernst, Councilwoman Tjornhom, and Councilman McDonald STAFF PRESENT: Todd Gerhardt, Roger Knutson, Laurie Hokkanen, Kate Aanenson, Paul Oehme, Todd Hoffman, Terry Jeffery, Jill Sinclair and Sgt. Peter Anderley PUBLIC PRESENT: Erick Elton Bruno Silikowski 8260 Audubon Road Julianne Ortman 8525 Mission Hills Lane PUBLIC ANNOUNCEMENTS: Mayor Furlong: I’d like to invite representative from our Environmental Commission, Ron Olson to come up and join me down in front and we’ll give out a couple awards this evening. Good evening. This evening we’re going to present the 2008 Environmental Excellence Awards. These are awards presented annually by the city to recognize environmental improvements and stewardship in our city by residents and businesses and others. The awards are designed not only to recognize achievement, but also to communicate new ideas and encourage other members of our city to take a look at ways that they can change their habits and make a difference in our world as well. The first award I’d like to present this evening, I’d like to invite Mary Borns to come up and join us please. Mary is a lakeshore owner, property owner on Lotus Lake and she understands the importance of water quality and it’s effect on the condition of the lakes. She’s become involved in the Riley-Purgatory-Bluff Creek Watershed District as a citizen, a member of the Citizen Advisory Committee and has learned some of the things that she can do to help maintain and improve the water quality of our lakes in this city. For several years Mary has taken her own time and resources to meet and educate residents around Lotus Lake about water quality. Mary hasn’t stopped there. She’s visited and spoken with residents in other neighborhoods in Chanhassen educating them about the water quality practices. Recently she worked with residents in the Laredo Drive reconstruction area to talk about benefits from rain gardens and other projects that we’re doing as a city and that they might do themselves. All this will help benefit the Lotus Lake watershed. In 2008 she also worked with other lake associations to coordinate carp harvesting from area lakes. The City of Chanhassen commends Mary’s dedication and commitment to water quality in our city. Thank you very much Mary. Mary Borns: I really appreciate this and it surprised me a lot. I thought maybe 10 years down the road after we see the effects of all our efforts, maybe there would be some type of a thank you for Steve Donen and myself who have worked together very closely on these combined City Council Meeting - December 8, 2008 efforts, and we’ve enjoyed doing all the work within the last year and I was shocked when they called me so soon, so I’d like to promise everyone clean water in the last 10 years… I do appreciate it and we are very happy to have Terry Jeffery with us in his new appointed position over the last, since September. Was it September? And he’s very inspiring as well as the people that we work with down on the watershed. Mike Casanova is here. Ken Wencl. Some of our other citizen advisors. I see John Tyler in the back and it’s been a pleasure and really fun to work with all of them and hopefully everything will go as planned and we’ll be able to see our feet when we stand in the water. Mayor Furlong: Now I’d like to invite Tom Anderson and Sharon Gotto to come forward please. Tom and Sharon are residents of the Riley Woods neighborhood. Lake Riley Woods neighborhood and their neighborhood has been busy this last year installing some new additions to the neighborhood landscaping. The neighborhood partnered with the City of Chanhassen, Carver County Soil and Water Conservation District to construct six large rain gardens in the right-of-way along Foxford Road. This neighborhood had been experiencing a large amount of water, storm water runoff that was causing erosion downstream and eventually went into Lake Riley, bringing with it sediment, nutrients and other pollutants. The rain gardens along Foxford Road will catch storm water runoff from the roads, driveways and lawns, infiltrate that storm water. Reduce flooding. Filter out fertilizers, nutrients and other harmful pollutants that would otherwise would end up in Lake Riley. The rain gardens were excavated in the fall of 2007 and then planted in the spring of this year by neighborhood residents, many of whom volunteered even though they were not able to have a rain garden installed on their own property. The large amount of neighborhood volunteers as well as their enthusiasm and participation in the planning process allowed this project to be installed quickly and with great success. The time, efforts and hard work that were put forth by the Lake Riley Woods neighborhood residents produced a landscape amenity that is a beautiful asset to the neighborhood and is also improving our water quality. Tom and Sharon, thank you very much. Tom Anderson: We were really pleased when we got the phone call, the email about having this opportunity to put in the rain gardens in our neighborhood. It was very nice working with the city staff and also the environmental group. It showed also that we could really come together as a neighborhood and get these rain gardens planted because it wasn’t particularly nice out the day we did it and we had a very large turnout. Also being a lake user myself, it’s really good to see the improvements to the water quality efforts so I want to thank everyone. Sharon Gotto: And I just would like to say thank you to the city because they’re going forward on being green. CONSENT AGENDA: Councilman Litsey moved, Councilman McDonald seconded to approve the following consent agenda items pursuant to the City Manager’s recommendations: a. Approval of Minutes: -City Council Work Session Minutes dated November 24, 2008 -City Council Verbatim and Summary Minutes dated November 24, 2008 -City Council Work Session Minutes dated December 1, 2008 2 City Council Meeting - December 8, 2008 -City Council Verbatim and Summary Minutes dated December 1, 2008 Receive Commission Minutes: -Planning Commission Verbatim and Summary Minutes dated November 18, 2008 Resolution #2008-67: b. Audubon Road Watermain Improvement Project 08-13: Award Contract. Resolution #2008-68: e. West-Central Lotus Lake Project 08-02: Approve Plans and Specifications; Authorize Ad for Bids. All voted in favor and the motion carried unanimously with a vote of 5 to 0. 1(c). AMENDMENT TO CITY CODE, CHAPTER 4, FEES. Mayor Furlong: Item 1(c), my only purpose as I was reading through the staff’s presentation there, I realized that in our discussion leading up to this we touched the surface of it. No pun intended. Under the surface quality and water plan and those adjustments, while they’re tracking to our plan, I’d like to take a little more time just to talk about policies behind that and what’s generating those fee adjustments and so I talked to Mr. Gerhardt today. I don’t think there’s any concern, there’s no risk. The existing fees will stay in place. I’m hoping it’s something we can pick up in the first quarter of the year. Of the next year, so it would be my I guess motion to adopt item 4-30 excluding the water quality and water quantity. Councilwoman Ernst: So moved. Mayor Furlong: Okay. Todd Gerhardt: Mayor, council. Just to add to that. We spent most of our time, when we did the utility rate study, talking about sewer and water rates and did not spend a lot of time on the storm water management so after Tom expressed his concerns, we could bring that back. Give staff some time over the next couple weeks to do a survey. Update it from the last time we did it in 2005 and give you the information on how we compare now to other communities. Mayor Furlong: Okay. Councilman Litsey: So we’re talking about just excluding the water quality portion of it and moving ahead with the rest? Mayor Furlong: Water quality and the water quantity. The two surface water. Councilman Litsey: Yep. And everything else. Mayor Furlong: We’ll keep those together and I want to use this opportunity to see where we are from a competitive standpoint with other cities but also look at the overall policies that are driving the fees and re-evaluate. Do another check on those. 3 City Council Meeting - December 8, 2008 Councilman Litsey: Seems reasonable. Mayor Furlong: Okay. So that motion’s been made and seconded to go forward with all, and table the water quality and water quantity portion. Been made and seconded. Any other discussion on that? Otherwise any clarification on the motion? Mayor Furlong moved, Councilwoman Ernst seconded that the City Council adopts the attached ordinance amending Chapter 4 of the Chanhassen City Code regarding License, Permit and Administrative Fees for 2009 and table the fees related to water quality and water quantity. All voted in favor and the motion carried unanimously with a vote of 5 to 0. VISITOR PRESENTATIONS: None. PUBLIC HEARING: REQUEST FOR OFF-SALE INTOXICATING LIQUOR LICENSE, JDK LIQUORS, INC. DBA MGM LIQUOR WAREHOUSE, 7856 MARKET BOULEVARD. Mayor Furlong: Let’s start with the staff report please, and first of all welcome back to our Assistant City Manager, Ms. Hokkanen, so welcome back. You’re on. Laurie Hokkanen: Thank you. The petition is for a request for liquor license. MGM Liquors is currently operating in Chanhassen. It is changing ownership. They do not plan any changes to how they operate or remodeling. Just product positioning. All background checks that were required came back with no findings. Also talked to police departments in the communities where they currently operate and again there were no findings from either of those locations so staff is recommending approval of the liquor license. Mayor Furlong: Thank you. Any qualifications? No issues at all? Laurie Hokkanen: No there aren’t. Mayor Furlong: No outstanding information that we needed prior to approval? Laurie Hokkanen: No. Mayor Furlong: Okay, thank you. Any questions for staff? Okay, without objection then we’ll proceed. We’ll open up the public hearing and invite all interested parties to come forward and address the council on this matter. Okay, no one this evening. Seeing no one. Without objection we’ll close the public hearing then. Bring it back to City Council for discussion and/or motion. Councilwoman Ernst: I’ll make the motion. Mayor Furlong: Councilwoman Ernst. 4 City Council Meeting - December 8, 2008 Councilwoman Ernst: I make the motion that we approve the request of JDK Liquors Incorporated for an off-sale intoxicating liquor license for MGM Liquor Warehouse at 7856 Market Boulevard. Mayor Furlong: Thank you. Is there a second? Councilman Litsey: Second. Mayor Furlong: Motion’s been made and seconded. Any discussion? Councilwoman Ernst moved, Councilman Litsey seconded that the City Council approve the request of JDK Liquors Incorporated for an off-sale intoxicating liquor license for MGM Liquor Warehouse at 7856 Market Boulevard. All voted in favor and the motion carried unanimously with a vote of 5 to 0. AUTOBAHN MOTORPLEX, APPLICANT, BRUNO J. SILIKOWSKI: APPROVE AMENDMENT TO CONDITIONAL USE PERMITS FOR DEVELOPMENT WITHIN THE BLUFF CREEK CORRIDOR AND FOR MULTIPLE BUILDINGS (UP TO 14) ON ONE PARCEL TO PERMIT THE PHASED DEVELOPMENT OF THE PROJECT AND ALLOW FOR THE INCREMENTAL EXPANSION OR REVISION OF THE PROPERTY LINE; LOCATED ON THE WEST SIDE OF AUDUBON ROAD NORTH OF THE TWIN CITIES AND WESTERN RAILROAD. Kate Aanenson: Again just for your information, the site did receive approval in 2006. The property is located on Audubon Road, just north of the railroad tracks, south of General Mills. The reason this is before you tonight is to provide another means of conveyance of property. When this notice went out to the residents there was concerns that additional units were being put on the site, or that the wetland itself was being altered. None of that is happening. Again it’s just a matter of conveyance on the property. So this is the original number of units remains the same as shown on the site plan. The wetland is shown on the property. There was a variance allowed, ponding in that wetland. This is a conservation easement. Again that remains the same. That was one interest that the neighbors did have at the Planning Commission meeting that was th held on November 18. A few neighbors did show up with concerns about access through that and the developer’s aware of that and that might be a motor vehicle access that’s going through that property and so working to secure that site. Again there’s a couple of different phases. So this conditional use, as we move forward are proposing an amendment that doesn’t allow this type of conveyance. This conditional use permit would allow for conveyance for the common interest of the community, so there’s 3 different phases, or 4 different phases. You own your individual unit and then there’s common property with each unit. So this would provide for the phasing, so this is Phase I. Now it’s divided up into a number of phases so this provides a mechanism for that to happen, so we’re not adding units. It’s just again a straight forward amendment to allow for that incremental change. So with that the Planning Commission and the staff, with the new Findings of Fact is recommending approval to the project and I’d be happy to answer any questions that you may have but the proposed motions are… 5 City Council Meeting - December 8, 2008 Mayor Furlong: Thank you. So clarification. Was this always their intent to do it the way that they’re going forward now with the phased approach, or has that evolved? Kate Aanenson: Well what we, we were proposing an amendment that this would have got tripped up in, and that was the issue where we had a conditional use. If someone tried to subdivide, so this kind of got caught in that, so we held off that, and allowing this one to go through because this is how it was proposed. We didn’t want this to get tripped into that. Mayor Furlong: What they’re doing was always what they intended to do? Kate Aanenson: That’s correct. Mayor Furlong: And because we’re clarifying some of the other areas of our ordinance, we need to clarify this. Kate Aanenson: You are correct. Mayor Furlong: As part of the permit. Or the conditional use permit. Kate Aanenson: Yes. Mayor Furlong: Okay. Thank you. Any other questions for staff? Councilwoman Tjornhom. Councilwoman Tjornhom: Yeah Kate. In the staff report it mentioned that they have the option of not developing the first couple buildings, is that right? Kate Aanenson: Yeah. That’s, there’s two buildings right along Audubon. Councilwoman Tjornhom: Right. Kate Aanenson: Yeah. Councilwoman Tjornhom: Now if they choose to sell those buildings, will, the development and the way it’s been approved, these two other buildings won’t have to do any additional storm water ponding or anything? Kate Aanenson: No, I think if those, if they want to be subdivided and they’re not part of this common interest, then more than likely they would be platted and that’d be a future decision that someone may want to plat those and have, because they wouldn’t be part of that common interest so…was to acquire those and build a separate use on there. More than likely they would probably be platted as a separate lot. So there could be two additional lots up there. Councilwoman Tjornhom: So then in the staff report on page 4 I think it says, under the conditional use permit for multiple buildings on Lot 1, it says the development of 2 buildings immediately adjacent to Audubon Road shall require a separate site plan review. 6 City Council Meeting - December 8, 2008 Kate Aanenson: That’s correct. Councilwoman Tjornhom: And so that’s what we’re talking about. Kate Aanenson: That’s correct. Councilwoman Tjornhom: And so that’s what we’re talking about. Kate Aanenson: That’s correct. Councilwoman Tjornhom: That’s only if it changes hands. Kate Aanenson: That’s correct. If someone wants, for financing purposes often times and they want ownership of that property and control of that property, so then if that doesn’t become part of a common interest and it’s a separate owner, that would have to go through that process. Councilwoman Tjornhom: Okay. Kate Aanenson: And that would all be done under one application as you stated. Site plan review, subdivision. And then any other requirements to meet the city codes, storm water management, all that would be required if that pond wasn’t sized appropriately. Councilwoman Tjornhom: Okay. Mayor Furlong: I’m sorry, clarify that last statement. If the pond was not sized appropriately. Kate Aanenson: For whatever use was to come into those two lots. They would have to meet all the qualifications of the city ordinance. Besides site plan review. Architecture. Storm water. Mayor Furlong: And is that true if ownership doesn’t change? Or have they already been approved… Kate Aanenson: It should be that way but if they were to change and they wanted to manage it on site or something like that, that could be accommodated. Mayor Furlong: Would the, to continue along that line of questioning. Are those sites buildable without variances and within current code? Are they buildable? Kate Aanenson: They haven’t shown a site plan on those per se so. Mayor Furlong: So the answer is it will depend. Kate Aanenson: It will depend, exactly. What the association wants to do with the, or the owner wants to do with those two lots. Mayor Furlong: Okay. 7 City Council Meeting - December 8, 2008 Councilwoman Tjornhom: I have one more follow up question, and this is just because I think we recently had something similar to where it changed hands and the storm water pond wasn’t built and so then we had problems with, was it on the Bluff Creek corridor, it was along somewhere and so I’m looking at these two buildings and I’m thinking what if the, they don’t meet the requirements. Where do they go? Kate Aanenson: Well I believe that just in general they probably do meet those requirements but I’m not sure, because we didn’t approve a specific site plan for that, we’d have to re-evaluate that to make sure. As we would with any other project that comes in. Mayor Furlong: And that’s just, regardless of whether the ownership changes or not, site plan approval is required for building on either of those two parcels? Kate Aanenson: That’s correct. Because the other ones were shown with the architectural renderings. The community room. All the other buildings were approved for an architectural layout and design, so that was all incorporated in the. Councilwoman Tjornhom: Okay. Mayor Furlong: Any other questions for staff? Is the applicant here? Kate Aanenson: Yep. Yep, there he is. Mayor Furlong: Anything you’d like to share with the council this evening? Address council. Bruno Silikowski: Hi again. I’m Bruno Silikowski. I own the property there and Kate you may not remember but when we went through that design, the storm water ponding actually included all 14 buildings, included what we estimated to be about a 20,000 square foot building. Two of them on that front lot so to answer your questions, the storm water ponding was actually designed to accommodate all of that. But you know it’s been a while so how could you expect to. Kate Aanenson: Well also when you come back through, we’d still verify that it’s still, that that pond was built as designed and that still meets standards. Bruno Silikowski: Absolutely. And so you know the other, the real backdrop here is you know economies are changing very rapidly. We just were looking for something that would make common sense if we do get into a situation where we’re running into trouble. We’d like to be able to have an option to be able to do, you know have a few options. Now good news is, we’ve actually had the opposite. The economy’s actually been good to us. In fact we’re starting another building. We built a, we started building about 4 weeks, 4 months ago. No, I’m sorry, 4 weeks ago and we’re starting another building in 2 weeks, and that’s just purely based on demand so I think we’ll do fine, but we are also trying to hedge our bets a little bit and trying to be smart business people and give ourselves some options as we go down the pipe. It’s not intended to, in fact we may end up actually involving those two parcels that we always thought 8 City Council Meeting - December 8, 2008 would be commercial type property into the campus just because of the rate of growth and success that we’ve had so. For what it’s worth, I’d be happy to answer any questions if you have any. Otherwise I don’t really have anything else to add. Thank you Kate for everything you’ve done. Mayor Furlong: Okay, thank you. Any questions? Councilwoman Tjornhom. Councilwoman Tjornhom: And I know this has already been to the Planning Commission and it’s been through us and approved but I remember in the staff report there were a couple letters, people were still concerned about noise. Was that resolved at the Planning Commission? Bruno Silikowski: I think, I don’t think there’s ever been anything resolved or even a real issue. It’s people have concerns that there are vehicles out there that. Councilwoman Tjornhom: Maybe reving their engines or. Bruno Silikowski: Well never does it happen. We’ve not had a single incident where we’ve had a complaint. I think if anything the residents have probably just been expressing something that would be somewhat common sensical but it’s just not who we are. Councilwoman Tjornhom: Okay. Kate Aanenson: And I think the other issue was that there are people that are trespassing on the property and that we’re trying to manage through security. Bruno Silikowski: Yeah, you know we, and again going back to the last Planning Commission meeting. We actually are having quite a few people come through the property. Snowmobiles. Go carts. Not go carts but what are the, like motorbikes type thing and we’re going to be, I think we’re going to be forced into putting a fence up on the far west end because there’s really only one entrance point. Otherwise they’re like little streams that kind of protect it. But you know and neighbors have been mowing a section of lawn back there for their use of walking their dogs and all that, and really I’m not bothered by it a whole lot except when it starts to cause problems. And we did have one incident where a neighbor had called the police basically saying there are people running around in the wetland, and frankly it can’t be us. It was in the middle of the weekend. Nobody’s around and the bottom line is I think that you know, I don’t know that we’re innocent always but I would tell you that there’s a whole lot of people who are accessing the property and I’m worried about it because I think we’ve got a few places where, you know it could be a hazard if they’re running snowmobiles across it, so we’re going to do a few extra things this year and put up more signage to basically kind of keep people off, but there is no way that we can keep people you know off completely. We cannot gate it completely and it’s just not possible. It’s too big of a property. It’s almost 40 acres so from that standpoint it’s not really been an issue from our standpoint. The neighbors had complained, I think it’s the same person who had expressed some early interest, or early concerns a couple years ago and you know, I don’t know that I can blame her but on the flip side of it, I think we’ve been really very good neighbors and I think there were several people who from that complex, that neighborhood have actually joined us as clients, and in fact some prominent people. I shouldn’t name names 9 City Council Meeting - December 8, 2008 because that’s not fair, but the bottom line is, they’ve been more than happy to buy up auction items that we do. We did the Tulip Festival thing and we offered up a private garage storage for the winter for one of them, and a prominent dentist in the area had very graciously bought it up and is having a great time out there with us so. There’s been a few other city officials that have stopped by and expressed I think satisfaction with what we’re doing, so from the standpoint of are we doing what we said we’re going to do? I think so, and probably a little bit in spades. We’ve done a lot more development on the property in terms of tree planting than was required from us. In fact we placed over 300 trees on the far west end from that neighborhood, so we try to do the right thing and so the bottom line is, what Kate has explained right now is kind of a, we’ve been kind of caught as a victim of some policy changes within the city, and that’s where we’re at so. No change to our plans. Good news is we’ve been doing well and we’re bringing in I think a lot of very wealthy individuals into this community. Hopefully they’re spending the money, I think they are. We’ve had a couple times where we’ve catered events and we had restaurants out there, local, that have catered our events so we’re going to try to continue to do that. Thank you. Mayor Furlong: Very good. Any other questions? Okay, thanks. Any follow up questions for staff? If not, general thoughts and discussions. Councilman Litsey: Seems pretty straight forward so I’m okay with it. Mayor Furlong: Getting the same purpose in what we’re doing, Okay. Is there a motion? Councilman Litsey: I can make a motion that the City Council approves the amendment to the Conditional Use Permit for the development within the Bluff Creek corridor with a variance to locate the storm water pond within the Bluff Creek Primary Zone and to permit phased development of the project and allow for the incremental expansion or revision of the property line in conformance with the grading plans prepared by Sathre-Berquist Incorporated dated 10/19/06, subject to the conditions on page 8 of the staff report, and the City Council approve the amendment to the Conditional Use Permit for multiple buildings, up to 14 on one parcel, and to permit the phased development of the project and allow for the incremental expansion or revision of the property line subject to the conditions on page 8 of the staff report and also adopt the attached Findings of Fact. Todd Gerhardt: Good job. Councilman Litsey: Get it all? Councilman McDonald: I’ll second. Mayor Furlong: Thank you. Would anybody like Councilman Litsey to repeat that? Councilman McDonald: I’ll put him out of his misery and I’ll just second that. Mayor Furlong: Motion’s been made and seconded. Any discussion on the motion? Hearing none we’ll proceed with the vote. 10 City Council Meeting - December 8, 2008 Councilman Litsey moved, Councilman McDonald seconded that the City Council approve the amendment to the Conditional Use Permit for development within the Bluff Creek Corridor with a Variance to locate the storm water pond within the Bluff Creek primary zone to permit the phased development of the project and allow for the incremental expansion or revision of the property line, in conformance with the grading plans prepared by Sathre- Bergquist, Inc., dated 10-19-2006, subject to original conditions of approval, adoption of the attached Findings of Fact and Action and the following condition: 1.The Common Interest Community shall include the land within the Bluff Creek Primary zone within the common area of the site.” All voted in favor and the motion carried unanimously with a vote of 5 to 0. Councilman Litsey moved, Councilman McDonald seconded that the City Council approve the amendment to the Conditional Use Permit for multiple buildings (up to 14) on one parcel to permit the phased development of the project and allow for the incremental expansion or revision of the property line subject to the original condition of approval and the following conditions: 1.Should the two building sites along Audubon Road develop with businesses unrelated to the Autobahn MotorPlex Common Interest Community, then those sites shall be separated from the balance of the site into separate parcel(s). 2.The development shall comply with the approved site plan for the project, plans prepared by Sathre-Bergquist, Inc., dated 10-19-2006.” All voted in favor and the motion carried unanimously with a vote of 5 to 0. 1(D). APPROVAL OF 2009 POLICE CONTRACT. Mayor Furlong: We have Sergeant Anderley with the sheriff’s department here this evening if there are questions as well but let’s start with Councilwoman Ernst. Councilwoman Ernst: Well as I was going through the packet it appears as though the police contract has increased by approximately 5%. And due to the fact that our financial condition has changed, and I know, I need to back up just a bit. So I know last year in the budget we approved the contract and if I remember correctly it was 1.2 million, Todd? Somewhere around that area. And of course our financial condition has since changed and if we’re to reduce spending I feel it is necessary to delay hiring of the additional officer for, and actually for the school if what I’m looking at. And I’m, and I think if I remember correctly Minnetonka pays for their officer and I’m wondering why the Chanhassen school cannot pay for their own officer. That’s number one. But number two, our crime rate has been significantly reduced. It was reduced prior to approving our budget last year so I really would not support at this time I would not support approving this contract. I approve the contract without the additional police officer because I don’t think that we need to have that. And that’s what, roughly $90,000? 11 City Council Meeting - December 8, 2008 Todd Gerhardt: The total contract, if my numbers are correct here Greg is $119,000 over last years? Greg Sticha: Correct. Todd Gerhardt: And you know we’re doing for 2009 is basically adding 1 and a quarter positions and each position is roughly $100,000. And you’re saying well how does that add up to the 119 and you’ve got inflation in there. The County changed their formula on calculation for some of the administrative portion of the contract so right now the contract before you is $119,000 higher than last year and we are proposing to increase 1 ½ positions in there. And of those positions one is the school liaison officer. Councilwoman Ernst: Right. Todd Gerhardt: In the contract it’s 100% but in the revenue side in the 2009 budget we have roughly $50,000 coming back from the school district. How it works in Carver County, Chaska High School, Waconia High School, the school district picks up 50% of that contract for the school liaison officer and then the City would be responsible for the other 50% so, and then basically what you would have in June, July and August, we would have additional patrolmen working during the summer months for the City and then 9 months working for the school district. And the reason the 50/50 is we get a little bit of benefit from a community in having that law enforcement individual at the high school helping with prevention and understanding the crimes that may occur there. So I think that’s the summary for the 2009 contract. Councilwoman Ernst: So a question for Sergeant Anderley. So is there a way that without hiring the additional officer that, and I understand, is the private investigator actually a full time job at this point? Sgt. Peter Anderley: The investigator position we put in for 08? Councilwoman Ernst: Yeah. Sgt. Peter Anderley: Currently, and I didn’t bring in the numbers and I was kind of looking at them today. You know roughly from April to the end of the November, we had right around 140 cases. 130 cases. Some where they’re assigned to Deputy Zydowsky based, and you know that was just cases assigned to him that he continuously worked on since his position became available in April. You know and I can, when we first kind of came on in April there, you know until he got going, it was a little slow in April, if you looked. If you broke it down by month by month, and now that he’s in the position and getting more things assigned to him and really got some networking in the area. I mean he stays very busy. There’s been some really good success stories that have come out of that. I apologize I missed the last council meeting. I wanted to share, you know we did have a residential burglary down on Flintlock where Chaska also had one that Deputy Zydowsky put in some long hours on the weekend, on the holiday weekend and we ended up as a result we have one in jail and both of them charged out. One from Chaska, home residential daytime burglary, and then one from Chan here so. It has been a very valuable 12 City Council Meeting - December 8, 2008 position. Not only for the city but for the guys working in Chan have really been able to solve some and get some really good leads on things and he’s staying busy. He’s working some nights and being some flexible time. It’s been a good position I think for the City. Councilwoman Ernst: So is there any, is there a way that any of the existing officers could I guess take that coverage at the school rather than hiring an additional officer? Sgt. Peter Anderley: You know, and I, the school isn’t open yet so it’s hard to say what kind of situation we’re going to come up with you know here. I can tell you how it’s worked in other cities. The school actually, you wouldn’t think generates a lot of police calls but they actually, when you break it down, the school resource officers are a pretty vital piece of the school. They get to know the kids really well. The kids are comfortable with them. They come into there. We solve more things when the kids feel comfortable going to that one officer. I’ve ran into kids out on the street that you know they want to talk about something that happened but they know him. They trust him. They feel comfortable with him. It also prevents you know from us pulling guys off of the road or gals off the road to go in there and take that call. There’s that. Also to and from school. You know we get a lot of complaints. I can tell you right now driving complaints from your smaller schools. You know the morning commute. The kids are trying to get off the bus. They’re trying to get dropped off by parents. There’s the school zones. All that. That’s another part of the school resource officer. He’s on the property. He’s going to monitor the traffic in the parking lots. He’s going to monitor the traffic coming in and out and he can handle those type of situations and leaves the other deputies in the area freed up because those, ultimately those calls are not going to go away. The day to day stuff that we deal with every day today is not going to go away when the school opens up. And that’s, it’s a big piece. It’s a busy intersection. It’s a busy road. I anticipate there’s probably going to be a few calls and that generated in that area based on whether it be a driving complaint or just traffic back-up, or who knows what it will be once it gets opened. But by adding an officer down there at the school, we’re able to keep the other guys on the road and do the day to day business that they currently do today. Councilwoman Ernst: Well first off I want to say that you’ve done a very good job. The department has but of course I’m trying to find ways to reduce costs and I want to go back to the scenario like Minnetonka paying for their officer, and granted we may have an investment there but is, is there any repercussions from changing that contract and asking the school to pay for it? I mean what does that do to the contract? Todd Gerhardt: We have not had serious conversations with the school district as of yet. The only repercussion I can think of is their current arrangement with Chaska and if there’s some reason that you know we try to get them to pay more on the contract than they would, you know Chaska would say we want to be treated the same way. So that’s the only repercussion I can think of. Councilman Litsey: I mean I think it’s reasonable that we partner with the school district on this. I mean this is a very common plan that communities put into place. We also gain the benefit of having that person available during the summer months when demand arguably is the highest as well out on the streets so, not only were you helping address an issue with the school, which 13 City Council Meeting - December 8, 2008 we’re I think responsible for to some extent. Having it in our community, but we have the benefit of that officer being available in the summertime too, so I think it’s a good partnership and it’s one that it’s just a very common arrangement and a reasonable arrangement. And I also don’t think this is the time to be looking at reducing our law enforcement presence. From what we’ve come up with a very sustainable plan for addressing some leanness is our law enforcement within the community. We’ve worked hard with the sheriff who’s a very professional person, as is his staff and is giving us I think some really good direction. Personally I think we should have adopted a more aggressive schedule for increasing police presence in the city but respecting the fact that we do have financial considerations to take into account, I think the plan that we adopted here within the last couple years of how to address this need and yet be able to sustain it financially, we’ve accomplished that. I think we have a very good, like I said, plan in place and I would hate to jeopardize that. I think the budget can support it. I think the residents and the community want this quality policing and I think this plan deserves our support so I’d hate to abandon it at this point. Councilwoman Ernst: Well and I don’t think that we would lose anything, what we currently have but just kind of going back to that position again. I’m wondering if there’s anything that you could look at, that the department can look at that we can utilize our existing resources for the school. Councilman Litsey: Personally I just don’t think that’s really viable. You can’t pull deputies off the street to try to cover the school and then they get calls and have to, you know get called away. The other thing as was already mentioned is, is the repoire is really a hard thing to put a dollar value on. The kids at school trust, and so does staff. You know they’re really part of that team. They’re part of that school staff and the team and the students there have someone they can go to that they feel comfortable with and I don’t know how you can really put a price on that when perhaps they’re maybe they’re being abused or something and they wouldn’t feel comfortable going to anyone but the school resource officer to talk about that. Otherwise it would probably go unreported. There’s all kinds of cases like that. Sgt. Peter Anderley: The other thing I wanted too is, you know is with the position, and you kind of touched on it. Is we get that officer back for the summer. Currently how we kind of run it is the sheriff out at Waconia and some of the other, the schools that we do in Chaska, is during the summer vacation, that officer comes out and is in the city, and patrols mostly on bicycle. Is out in the parks. Is out in the things, and the repoire that that guy has, when he, or gal, you know he gets out there. He’s on that bike and he’s going through the parks. They recognize him from school and so he’s been, he knows what’s going on in the summer months too. He keeps up with the kids. He keeps up with the juvenile problems we’re having and that’s something that with this, now with the school in here, you’re going to have a lot more the Chanhassen kids are going to be, you know they’re going to be hanging around the school more with school activities and that type of thing, so before and after school, if there’s an issue, we can go to that school resource officer. He’s going to know who they are. He’s going to know their situation. He’s going to be able to deal with those problems with the school kids and again, it will leave the deputies you know to do the everyday business that they continue to do. You know could the deputies do it? They may be able to, but you’re going to be taking away from something else. 14 City Council Meeting - December 8, 2008 With that school, it’s going to generate calls. A school that size, with that many kids, there’s no doubt that there’s going to be a need for some police services in and around that school. Councilwoman Ernst: Right, and I agree with that. I’m just looking at, with the private detective coming on board, and adding a new officer, if there a way, and it can be the same person. Maybe it’s just a matter of how the police officers are structured in their different areas. And our crime rate has gone down so obviously there’s always work to do but if our crime rate has gone down, does that mean that we can move some of our existing officers over there? Councilman Litsey: Well I would caution against saying our crime rate’s gone down is the only measurement by which we look at police standards and how we want to staff our police department. We have customer service. The ability to respond to crimes swiftly and so forth and investigating. You’ve got to look at the types of crimes that are down. Types of crimes that are up. Some crimes take very little time to investigate. Some take a lot of time. I mean the overall idea behind this plan was that we understand and recognize we’re on the lean side when it comes to policing. We also have financial considerations. This was a financially sustainable plan that makes sense to enhance our customer service when it comes to law enforcement to provide more responsive department. To structure it a little bit better than it is now. And just to meet some needs that we have identified and we’re looking at adopting a budget tonight that is going to either, probably reduce for a lot of people and certainly not raise taxes for most people in this community, and I would think that they would want to, us to follow this plan. I don’t see what we’re gaining. I think public safety is a core service that we provide. This isn’t the area that we should look at to save a buck a year or something for people. Councilwoman Ernst: And I respect your opinion Councilman Litsey. I just can only go by the numbers that are in front of me and that’s what I’m basing my thoughts on. Councilman Litsey: No I understand that but you and I have had discussions about it and I would have hoped that we perhaps could have moved beyond just looking, compartmentalizing in just one area. There’s a whole, a whole array of different things that you have to take into account when it comes to determining police staffing. Not just isolate one single thing, much like businesses. You can’t just take a snapshot of one thing and say okay, that’s what we’re going to base our whole plan on. We’re basing our plan on a multitude of factors that we really look closely at and come up with this is a reasonable approach to meet our needs. Like I said I think it should be more aggressive but in the spirit of compromise and understanding other positions on the council, I think this was a good middle ground to move us forward. Councilwoman Ernst: Well I’m looking at. Sgt. Peter Anderley: Something I can add real quick is, it’s hard to, it’s really hard to, you know when you look at the numbers, you’re saying crime stuff has gone down. It’s hard to capture a number that is preventative patrol. By getting where we’re at now with the amount of officers that we have out on the street driving around, those numbers, and you know we can’t say for sure 100% that’s the reason, but a lot of it has to do with we don’t, when we go through a neighborhood at 2:00 in the morning, at 3:00 in the afternoon, we don’t know what we’re preventing. If someone was going to go up and break into a house and they’re walking up to a 15 City Council Meeting - December 8, 2008 house and all of a sudden they see a marked squad car coming down the street, you know they turn around and they get in their car. We had no idea, there was nothing wrong with this person. They just drive away, but we prevented a burglary. There’s no way of capturing what that is preventing, but what we can do is we can tell you know some of the crime has gone down in certain areas of the city as far as what levels of offenses and that type of thing, and we try to contribute that as saying, you know because we’re out there more, the investigator position came in. It allowed the patrol guys to be out driving around and being visible. Rattling the doors and those type of things. Looking for the, being proactive in the community and protecting the citizens, and that’s something that’s really hard for us, and there is no way of capturing what we prevent by just driving around. Councilman Litsey: Well and the reason why it’s hard to get kind of a solid number sometimes too is there’s, you can also make the point that, as you increase your staffing, the crime rate could go up because you have more proactive enforcement. People out there getting more DWI arrests and those kind of things that factor in the Part II crime rate so I mean, I mean you could have no reported crime if you had no officers because there’d be no one to report it to, if you want to carry it to that extreme. So I mean the ideas that if you’re out there working hard and aggressively seeking out the crime in the community, you know when you’re at staff, conceivably the crime rate can go up. Councilwoman Ernst: Certainly I don’t want to take away from the security of our citizens. That’s not my intent at all. I don’t want to compromise that in any way. But I need to take a look at how we can utilize our existing resources, and actually back to my original point, I’m wondering if there’s a way that you could take a look at that to see if there’s something that we could do. Mayor Furlong: You want to respond to the question? Sgt. Peter Anderley: You know I guess that would be up to the you know someone in administration. The Sheriff would have to go back and look. Currently with the school and what we’ve talked about, I think we need, I would take a strong position that we need to keep kind of where we’re at. Todd Gerhardt: Mayor, council if I can try to help answer that question. As I’ve, have always told you in the past, always look at what type of police service level you want to provide, and I mean we can go back and look at how many patrolmen we have. The detective, and we can reallocate some of those people to school liaison officer let’s say. But you may have to lose that detective then and, or if you lose a patrolman, now you might not have double coverage where another patrolman might need back-up. So, and that’s kind of what you lead to is always to try to have two patrolmen on at all times for that back-up, and power shifts when you know 4:30 to 7:00 as people are going home and you typically have your accidents that occur at that time. So I think to answer your question, we can modify the deputies that we have but it gets back to what type of police service do you want to provide. So that’s the direction we’d want to see from the council. Mayor Furlong: Councilwoman Tjornhom. 16 City Council Meeting - December 8, 2008 Councilwoman Tjornhom: Yeah, and I just wanted to say that the direction this conversation seems to be only about crime, and the level of crime decreasing, increasing. The sheriff’s office does more than just prevent crime. I mean you’re a public service organization. Public safety. If there is an accident on any of our streets, or if there is someone who has a health need and the ambulance is called, you’re there so it’s not just fighting crime, I don’t think. And I think we forget that the opening of 212 has brought a whole lot of cars into our town, and the increased population has brought those people into town also, so I just want to make that clear that it’s not just about crime. It’s about public safety for everybody in town. Councilwoman Ernst: And I think I had indicated that I didn’t want to take away in any way, shape or form the security of our residents. Whether it comes to crime. Customer service. Whatever the case might be. My question is, can we still get the job done utilizing existing resources. Councilman Litsey: I would just make one other, maybe final comment here because we’re going to round and round but, yeah I mean could you bait. You know staff it at a minimum level of like 7 officers to provide 24/7 coverage? Well yeah you could do that. Does that make sense for a community like Chanhassen to do that? Obviously not. You want some back-up, as we talked about. So much of what a law enforcement agency does is beyond just crime, like was… by Councilmember Tjornhom insightfully I might say that calls for service many times are accidents, medicals, nuisance complaints, but it goes to the quality of life in the community and what we as a council want to provide for the residents, business owners and so forth. What’s a reasonable amount of law enforcement service? I think we want beyond basic level. We want to have a full service organization that can meet the needs of the community. One of the neat things we found out about the investigator position is that the need was there. That people can come right to Chanhassen City Hall to meet with the investigator. To talk about their crimes. There’s follow-up. It doesn’t hold deputies up. Their patrol duties to follow up on those crimes. It’s really been a win/win situation and we have spent a lot of time looking at what makes sense for this community and that’s the plan before us tonight is to continue down that road, which is financially sustainable, as they say, and meets a real need in this community for live quality law enforcement services. Councilwoman Ernst: And I understand that. It’s just that times have changed in the last year. Our economic financial condition has changed in the last year and I’m just asking for other ways to do the business and not compromise anything that we have today. Councilman Litsey: I don’t think we could do that without this plan. Mayor Furlong: I guess what I’m hearing Sergeant is that it’s your recommendation to move forward. Sgt. Peter Anderley: That would be my recommendation, yes. Mayor Furlong: Given the way the service level is provided and customer service. 17 City Council Meeting - December 8, 2008 Sgt. Peter Anderley: Yeah. I mean basically, you know we’ve got a pretty good team and schedule and the amount of cars out there, but even tonight you know if you paid attention, if you had one of our radios on, you’d wonder what was going on out there with the snow. We had, it was quite some time where we had 4 to 5 cars are in Chan and they were all tied up with vehicles in the ditch, medicals, that type of thing. So some days, even that’s not enough but you’re going to have those days, but really we’ve been at a pretty comfortable level this year. We’ve been able to really sustain you know when we have gotten hit with kind of a bunch of calls, we’ve been able to work through it and really deliver in the customer service all the way around. Mayor Furlong: Okay. Any other questions? Councilman McDonald: I guess if I could just chime in on all of this. I remember back in 2006 this was a big issue and as Councilman Litsey points out, there were two schools of thoughts about the way to aggressively go after this. I thought the council at that time did come up with a good plan. I mean one of the things that we’re looking at is yes, we could go back to the number we had then but the problem we run into is the city has gotten bigger. The demands for customer service have gone up, so I think that in addressing your question to them about trying to do the job with less people, I mean just the numbers alone have kind of shown us we’ve grown, and I think as part of the plan that was put in, it was to accommodate that growth and we’ve been on track, and yes crime has become less of an issue but maybe that’s because the plan’s working and it’s not because everybody’s decided to get out of the crime business. It’s just the plan’s working. And also if you look at yes, economic conditions have changed but typically when they get into a recession, that’s when crime always goes up so I would say that you know as a community, that’s when you definitely want to have the protection of the residents. So if we were to go back to the levels that we had prior to that where we were having problems I think providing that public service, we’re just going to make a problem even worst than what it currently is. So I’m not sure that this area really is one that we want to sacrifice you know going forward for budgetary reasons so for that reason I guess I would support. It’s within the budget. It seems very sustainable. We do have a plan that seems to be working. I think we should continue with that. Councilwoman Ernst: Just point of clarification. We do have one additional and that’s the private investigator, so it isn’t like we would be going back to what we had. We do have an additional private investigator that we didn’t have… Councilman McDonald: But when you say private investigator, are you talking about the detective? Councilwoman Ernst: Yes. Todd Gerhardt: Yes. Mayor Furlong: The investigator position. Other thoughts? Comments. Councilwoman Tjornhom. 18 City Council Meeting - December 8, 2008 Councilwoman Tjornhom: I think I can just probably echo what I said when we approved adding the private investigator, or the detective and partnering with the school district with the police officer in the school that this is an area that I have to trust the experts and that’s our sheriff. He’s the one who has come and told us this is what his needs are and I think it’s my responsibility as a council person to respect that and accommodate what he thinks he needs. The tools he needs to effectively police and protect our residents in our town. Mayor Furlong: Yeah I think we’re, we’re in the second year of a three year plan right now that was the outgrowth of a discussion of police levels and service levels for our city. The questions I think are valid questions to be raised and in terms of proper utilization of resources and such like that but as we sat down I guess it was 2 years ago and, or early last year and looked at it and started implementing it last year, this year and now into next year and then I guess 2010 would be the final. Final implementation. We were looking at, at that time, and these things I don’t think have changed. That there was a need for an investigator. That that was taking deputies off the street and it was a service level that at the time the council agreed was an appropriate for us. We also had the new highway being opened. That was mentioned before and the new high school was coming, and that’s still in the works and so we’re still working that. I think it’s, with what we know now I think continuing to follow the plan makes sense. It is the best thing to do, and just as we did with the investigator position, one of our initiatives this year was to review it, monitor it and get a report back on the services being provided and making sure that that’s the case, and I think we need to do that as we continue to follow through with the plan. Public safety is a high priority I know for everybody here. It’s just a question on how that is delivered, and that’s…but I think that we’re in the process here of continuing to follow the plan that we put in place. I think we need to continue to follow it at this time based on what we know and continue to monitor it going forward into next year and the year after and continue to re-evaluate so. I think the questions are valid to be raised. I think I would agree and certainly support going forward with the contract as proposed this evening. Any other thoughts or discussions? Is there a motion? Councilman Litsey: I’ll make a motion that we, the City Council approves the 2009 law enforcement contract with Carver County. Councilman McDonald: I’ll second that. Councilman Litsey: Seconded. Any discussion? Councilman Litsey moved, Councilman McDonald seconded that the City Council approve the 2009 Police Contract with Carver County as presented. All voted in favor, except Councilwoman Ernst who opposed, and the motion carried with a vote of 4 to 1. Councilwoman Ernst: And I only say that just because I’m lacking some of the information that I’m asking for. Mayor Furlong: Motion prevails 4-1. Okay, thank you. Let’s try since we’re talking budget, let’s try to continue with our next item on our agenda which would be the consideration of the 2009 budget. Then where I want to go is back to number 2 immediately afterwards on our 19 City Council Meeting - December 8, 2008 agenda if, Senator is that okay? Thank you. Let’s move forward with, we’ll go to item number 5 on our agenda which is consideration of a motion to adopt the 2009 budget and the 2009-2013 Capital Improvement Plan. Let’s go to staff report please. ADOPTION OF THE 2009 BUDGET AND THE 2009-2013 CAPITAL IMPROVEMENT PROGRAM. Greg Sticha: Good evening Mayor and City Council members. Last week we held our Truth in Taxation hearing meeting. Just to kind of catch up, some people, catch up some of the audience out there that may have either missed the Truth in Taxation hearing or our budget discussion last week. I’m just going to quickly review some of the information before I get into the power point presentation. Staff’s recommendation for the 2009 budget is to set a general fund expenditure budget of $9,859,100 which results in a $10,074,565 levy which is a 2.4% increase in the tax levy from the previous year. Just to kind of give you some background on where we came from. Originally in August staff had submitted a budget of $9,959,100, which was $100,000 more than the recommendation this evening. At our September budget discussion meeting, before we set the preliminary levy in September, City Council lowered the original staff request $44,551 to $10,130,014 which would result in a 3% increase in the levy from the previous year. In October we got a handle on a few numbers that we didn’t have quite enough information on in August to make sure that the numbers that we presented in August were a little bit more than what we got based on some of the information that we did get in October. I just want to kind of go over the spread sheet that kind of talks about these amounts, and we talked about them briefly last week in our budget meeting following the T-n-T hearing and I just want to review them on more time this evening real quickly. Staff was able to find resources or cuts within the general fund listed on this spread sheet totaling $116,300. Reducing wages from 4% to 3 ½% was $17,000. Adjusting our health care costs from an increase of 25% down to a 9% increase saved $36,000. Since fuel prices have moderated since August we reduced the fuel budget by $45,000. Again fuel related to utility costs, we also were able to reduce the utility costs at the library by $10,000 and reduce costs at City Hall by $8,300. Those items total $116,300. In staff’s recommendation what we are proposing is to use $100,000 of that amount to lower the levy giving a resulting levy increase of 2.4% which is effectively right around the amount of new growth that we saw in the city of Chanhassen this last year. The remaining $16,300 plus the other two highlighted yellow items on the spread sheet on the screen, the $10,000 for the elimination of the Maple Leaf and the $16,000 for conducting the citizen survey every 4 years rather than every 2 total approximately $42,000. Staff’s recommendation is to use that $42,000 to be set aside for road costs in the future. Increasing the transfer from the general fund from $150,000 to $192,000 into our road fund. The other part of staff’s recommendation is to use the sealcoating amount in 2009 of $217,000 to buffer any revenue shortfalls that we may have in 2009. Those are essentially the two recommendations that staff has. With that information in mind, now I’m going to go into a quick power point presentation that talks about the final levy and budget adoption before we go any further. With that information in mind, the 2009 budget increases expenses 5.8% to $9,859,100 which again is approximately $55,000 lower than the preliminary levy which was set in September. The increase is by line item are listed there by area of department or general government, law enforcement, public works, community development, park and rec, and again noting that the transfer for roads has now increased to $192,000. Revenues are essentially the same numbers that you saw last week with the one change in the property tax line item was 20 City Council Meeting - December 8, 2008 decreased to lower the levy to the 2.4% which would be the one change in the Truth in Taxation power point that you saw last week. Taking a look at our general fund expenditure history, you can see again the increase in expenditures to the $9,859,000 or 5.8% and it also shows a history of the expenditures within the general fund each of the last 7 years. Looking at our total levy history, this would be all levies within the city of Chanhassen which also would include debt levies and our levy for our capital replacement fund. You’re looking at again a 2.4% increase based on staff’s recommendation. The bump or blip in 2004-2005 was due to adding the capital replacement fund levy of approximately $800,000. We did that in 2005 and that’s why you see the increase in that particular year. Rather than bonding for the equipment, City Council decided to cash that with a levy amount increase in 2005. Taking a look at the city of Chanhassen’s tax rate history, and this is a pretty good picture here. As you can see in 2003 our tax rate was at approximately 39% and over the last several years, each year we have been able to reduce the tax rate. In 2009 based on staff’s recommendation I’m estimating that the tax rate would again go down somewhere between a half a percent and about a percent to approximately 23.5. What factors changed this year’s budget from the previous year’s budget? Again increasing expenditures in the general fund by 5.8%. What makes that up? Wage and health care costs increases account for approximately 46% of it, or $249,000. The police contract, which we talked about just a few minutes ago was about, almost $120,000 or 22% of that increase. The amount for increased fuel and utility costs was about $98,000. That number was a little higher in last week’s presentation. And again the transfer for roads is now $192,000. Looking at it by type of levy, tax capacity levies which are levies that everyone in Chanhassen pays, including businesses. Those levies only increased less than 1% or .6%. Market value levies which are voter approved levies, so only the residents would be paying for these particular levies, increased 20%, and as we discussed last week, the increase in the park referendum levy was for a refinancing of that debt to make it, to fit it better in our debt schedule into 2009 when we had more debt become available. We also did achieve a decent sum of interest cost savings by refinancing at the time that we did. The net tax levy effects. The general fund levy increases 4.9%. However a total levy increase of 2.4% or $239,000. Again the 2.4% is the same amount that we saw in real growth. New construction in the city of Chanhassen in the last year, and again just noting that the 2009 tax rate, based on staff’s recommendation will again be lower than the previous year’s tax rate. With all of that information in hand, at this point staff is recommending adopting the tax levy and budget as presented in the memo and I would take any questions. Mayor Furlong: Thank you. Any questions for Mr. Sticha? Councilwoman Ernst: I have a question. Is there a possibility we could break the CIP out separate from the budget? To be voted on. Mayor Furlong: I think we certainly could do that. We haven’t really talked about the CIP at this point. Were you going to do that before adoption? Greg Sticha: No. I was not going to get into a detailed discussion about the CIP. That number had not changed since last week aside from adding one project, a storm water project for, watermain project for $170,000 which was not in the CIP that you saw last week. That was the only project that was added. 21 City Council Meeting - December 8, 2008 Mayor Furlong: Okay. Do you have questions on the CIP? Councilwoman Ernst: No. On the budget. Mayor Furlong: You just want a separate vote. Councilwoman Ernst: Right. Mayor Furlong: That without objection we can certainly do that. That’s fine. Other questions for Mr. Sticha. Councilman McDonald: I’ve got one question. You’ve taken the $100,000 and you’ve come down from that. What’s a rough figure for the funds that could be set aside for a contingency? I mean when I add it up I think I’m around 250. Am I close or am I missing something? Greg Sticha: It depends on which figures you’re, are you adding the 217 and the 20 and the 2,400 and 5,600? Are those the figures that you’re adding? Councilman McDonald: That’s probably what I’m adding. That’s what I’m trying to come up with is if we look at contingency funding, what do I take away from that and I think when I add it up I’m right around 250. Greg Sticha: Yeah, if you add up those number that’s 237 plus, that’s about 247. And staff is not recommending delaying the quarter patrol position or elimination of the meals or travel and training for City Council as part of the contingency plan. Our hope is that the, setting aside the sealcoating as our revenue shortfall contingency would be enough for 2009. I guess we won’t know that until May, and certainly at that point in time we’ll be coming back to council to discuss if that is going to be enough to cover any revenue shortfalls that we may see in 2009. Councilman McDonald: Okay, and I guess that’s what I’m looking for is what projects would we be able to vote on in the future that if something you know isn’t working out quite right, that number could be transferred to a shortfall, and right now what you’re telling me is it’s probably the sealcoating is the primary candidate. Greg Sticha: Yeah, that would be I guess staff’s recommendation, yes. Todd Gerhardt: Well that would be, Mayor, council members. The largest portion would be sealcoating but basically you would have the $16,000 from the fuel costs, the utilities for library, city hall would fall into that additional $42,000. If you add the 16 plus the 10,000 for the Maple Leaf and the citizen survey, and in those categories you know as we come back in May to talk about how we’re doing on building permit revenue basically, we could re-implement some of those programs if we’re on track to see that we’re going to meet our goals. So you basically have $42,000, the patrolman and the sealcoating available for a contingency fund. 22 City Council Meeting - December 8, 2008 Councilman McDonald: Okay, well I guess I wasn’t looking for the patrolman. We just discussed that but the other issues, the sealcoating, the Maple Leaf, and what was the, oh the citizen survey. All those again could be re-visited in May. Greg Sticha: We would not have to make the transfers for roads until later in the year. Currently, the original proposal had $150,000 for transfers for roads. The new budget has $192,000 for transfers for roads. We would not have to make that transfer until later in the year. We could at that point decide to stick with the original $150,000 transfer if we wanted to. Councilman McDonald: Okay. Mayor Furlong: If I could on that. We can delay the entire transfer of the roads fund to later in the year. I mean the roads fund does not require these funds to do work on any projects that we’ve got. Greg Sticha: That’d be correct. We can make that transfer at any point. Mayor Furlong: How ever many years. Not even just next year, but years out. Greg Sticha: Correct. Councilman McDonald: Okay. And I guess to my point, that’s the pocket of money that if we need to look at contingency planning, that’s where it will come from and the next time we will know whether or not we have to do something will probably be in the May timeframe because by that time we’ll have some actual revenue to see where we’re at and, okay. That’s. Councilman Litsey: I guess where I had some confusion too from the last discussion was, the dollars haven’t changed but you jumped right to the sealcoating when in fact once we meet the $100,000 that we need to get the levy to where we want, anything above that really is somewhat discretionary, right? Including the $42,000 going to the road fund. We wouldn’t necessarily have to jump to sealcoating. Maybe it’d make more sense depending on the size, just to go to the transfer the road fund and not, does that make sense? Mayor Furlong: I think the issue of, what the council had asked staff to do earlier on in the budget process, and we’ve been, council and staff has been working on the budget since the summer months. July-August timeframe. I can’t believe we’re actually getting to the end here. We’re going to have to start the next one pretty soon. But the issue came up with the deteriorating economy is to recognize that a significant source of revenues for our general fund budget is based upon permits and building permits and development fees. We all recognize that those were more uncertain. While we think we have a reasonable estimate of what those will be, based upon our current information, we realize there’s uncertainties there. So we asked the staff to say what are some contingencies that could be put in place. That’s where this list was put together. These are some bigger ticket items that the staff says these are easier ones to identify. There could be other ones. They don’t have to be these. But I don’t think tonight it’s encumbent upon us to identify what the contingent sources are. I think we can all step back from that because when and if that issue comes up in the spring, late spring, early summer months, we’re 23 City Council Meeting - December 8, 2008 going to be working with information, better information then, than we have now and so we have the luxury of time to defer that. We just want to make sure that there were some opportunities from a contingency standpoint in case revenues did not come through as we’re particularly budgeting right now so I don’t think Councilman McDonald, to answer your question, I don’t think we’re limited to this list but I think this list is, clearly provides some representation of what’s available as well. But we don’t have to make a decision now at any point in time. Councilman McDonald: No, and I wasn’t asking us to. Mayor Furlong: Now, this evening, right. And I want to, so I don’t want to get into a big debate tonight about which contingency we should pick or which one we shouldn’t pick simply because one, we don’t know if we have to do any. And two, we’ll wait and find out and use current information at the time if we do have to do something and modify the budget mid-year. Let’s wait and use good information at that time, just as we’ve seen significant information change between the summer months and today. Councilman Litsey: Oh I agree it was to give us a general comfort level that there things that we could go to if the need came up and these are things that can be deferred decisional wise until later on. So it’s a general comfort level. Mayor Furlong: And that’s exactly right, and I think we spent some time last, a week ago talking about them and really kind of pre-deciding and I think we need to step back and say we have the luxury of time. Councilman Litsey: I agree with that. Mayor Furlong: Here on this and so Mr. Gerhardt. Todd Gerhardt: Mayor, council members. Councilmember Litsey is correct. He heard Greg say that staff recommended the sealcoating and I can speak for Greg. He misquoted on that and I think he meant that the list is all available and that staff would bring back a report to the council to consider all items plus additional ones that department heads may come up with between now and if the issue arises that we need to look at cutting revenues. It may happen that we don’t and so you’re absolutely right from what I heard and that’s not the case. We are not recommending any of these items as a priority list right now, as a part of the first that we would cut in contingency. Councilman Litsey: I agree with Mayor Furlong that we can make those decisions later on. We’ve identified some things now that we would go to and there may be others, but at least we know there’s some flexibility in there. Mayor Furlong: That’s correct and that was. Councilman McDonald: But my whole point was just to point that out. That there is some flexibility. I’m not asking to do a vote on any one of these. All I’m trying to point out is that we recognize that yes, there is somewhat flux because of the economy. We have accommodated 24 City Council Meeting - December 8, 2008 that by looking at certain areas, and again the detail may come in May because we may not even need to do anything. So that was my only point in bringing this up. It wasn’t to try to create a debate on it. I apologize for that. Mayor Furlong: No, but no. No apology necessary. I think the fact that you brought it up gave me the opportunity to clarify perhaps, and I probably could have…last week but, thank you. Other questions? Councilman McDonald: No. Mayor Furlong: Councilwoman Tjornhom, any questions or Councilwoman Ernst? Councilwoman Tjornhom: I don’t have any questions. We’ve been hammering this out since August or June, July something and so I think you know last, I think we had a really good discussion last Monday about the budget. It was good to see other people in the audience here for Truth in Taxation that had their two cents to put in and so I think, like I said, we did a lot of good work last Monday and now it’s time to finalize it and be onto the next budget. Mayor Furlong: Okay, there you go. Any other questions for staff at this point? Councilwoman Ernst: I don’t have any questions. I do have a comment. Mayor Furlong: Right, I want to get to comments as well. Just a clarifying question too. Mr. Sticha, the $42,000 I think we all agree is a reduction of expenses for the. Or excuse me, yeah. The 42 that is the difference. You placed it in the transfer to the road fund category, but the real risk that we‘ve talked about are, is on the revenue side. We’ve got risks on the expense side too because we’re making estimates about fuel prices and utility costs that we’ve seen can be very volatile over a very short term rather than, not even a long term, but if those funds, if the revenue does come in less, the fact that we’re just putting it in a road transfer as much as a place holder as anything else. We could have just as easily reduced our estimate on the revenue side from a budget standpoint. The net effect would be zero, is that correct? Greg Sticha: Sure, essentially by putting it there it’s a place holder. Mayor Furlong: It’s a place holder, okay. That’s what I wanted to clarify. Councilwoman Tjornhom: Mayor I have one question after I said I didn’t have any questions. Sorry. Mayor Furlong: That’s okay. Councilwoman Tjornhom: And I think you probably answered this last time. I’m not sure if… has the correct answer but we’re talking about the volatile prices of fuel and we were going to have a contract with the State or partner with their pricing. Has that, do we have any numbers yet on that? 25 City Council Meeting - December 8, 2008 Greg Sticha: I can let Mr. Oehme talk about that in a minute here, if you wouldn’t mind commenting on the fuel contract. Paul Oehme: Sure. Councilwoman Tjornhom, we have not received any information back from MnDot who’s going to be letting the contract out. We are anticipating some feedback, or the th actual costs per gallon for the fuels by the 19 of this month, so we’ll know by then what the costs will be, and if MnDot will approve that contract or not so. And again, we’re not going to be purchasing 100% of our fuel costs through this contract. We’re only going to be leveraging probably 50% of our fuel needs through the contract so we’ll still have to go out to the market locally and buy that other 50% so. But it does hedge our bets a little bit in terms of trying to take some of the buffer off of the price fluctuations that we’ve seen this summer. Councilwoman Tjornhom: So at least half of your budget will for sure be. th Paul Oehme: Absolutely, yeah. If MnDot approves the contract. But again by the 19 we should know what that number is. Councilman Litsey: But you’ve mitigated the volatility of that category by 50% almost. Paul Oehme: Exactly. Councilman Litsey: So that’s a good thing. Councilwoman Tjornhom: Thank you. Mayor Furlong: Okay, thank you. Let’s at this time then open up for comments and discussion with the council regarding the budget. Councilwoman Ernst. Councilwoman Ernst: First off Greg and Todd, thank you so much for spending hours with me on the phone explaining and answering all my questions the last couple weeks on budget, and I’m glad that we had the discussion on Monday on budgets. It really helped me understand but of course I had some additional questions after that today. But you know we need to be more fiscally responsive now than we have ever been, and when we’re looking at an increase in a budget of 5.8%, which is almost 3% over last year. I mean we have people that are losing jobs. We have people that are not getting wage increases, and you’ve given us, staff has given us some good recommendations and you’ve given us some additional options and if we look at what you’ve given us today. You’ve given us $142,000 reduction. To the general budget, correct? And as I look at that I’m thinking what is really the right thing to do with this, and how do we remain financially stable, and I don’t believe that you would have given us these options and the additional’s if we weren’t going to be financially stable. And if we take all of those things into consideration, I believe that we can get to the point of the additional $158,000 to bring the general budget to a zero flat percent. And I, whether that means looking at wages. Whether that means looking at catastrophic funds. I mean you’ve laid out a number of different additional options there and I would really like to see you go back and look at that to see if you could get an additional $158,000. I know it’s tough. It’s been tough so far but everyone is going through some tough times right now and we need to be, actually I’ll quote some of Paul Kohl’s words. 26 City Council Meeting - December 8, 2008 He said it’s time to get serious about controlling government spending, and we need to make sure we’re doing our due diligence, and I as a city councilmember need to make sure that I am doing my due diligence and challenging that. Mayor Furlong: Councilwoman Ernst, you mentioned $158,000. Help me, is that on the spread sheet or? Councilwoman Ernst: It’s a number that I got from Todd that said here’s what we would need to get to the zero, and I don’t need to make that. Mayor Furlong: Is that a zero levy increase? Todd Gerhardt: Yes. Mayor Furlong: From where? Councilwoman Ernst: In the general fund. Councilman Litsey: From where, 2.4? Greg Sticha: From the 2.4 to get to a zero percent levy increase you would need to, what Councilwoman Ernst is talking about the $142,000. Using that as well as finding another $158,000 which would get you to a zero percent levy increase, if you found it total, if you look at the left column of the spread sheet. You see the amount of reduction in expenses needed in each level there. Essentially to get to a zero percent increase you would need it just shy of $300,000 so 158 plus the 142 would get you to a zero percent levy increase. Councilwoman Ernst: Which would bring our 5.8 in the general fund to a zero as well, right? Greg Sticha: No, it would not bring the spending down to a zero. It would bring spending down to, I’ll get you that number in just a second. Councilwoman Ernst: The impression I got is that the $158,000 would get us down to zero in the general fund as well. Greg Sticha: It would bring you to a zero percent levy increase but spending in the general fund would still be higher than the previous year. Just let me calculate that number for you in a second. Councilwoman Ernst: So whatever that number. If it’s not 158,000, whatever that number is. Mayor Furlong: I think Mr. Sticha’s working on your answer here. Councilman Litsey: No pressure here. Councilwoman Ernst: He’s been under a lot of pressure the last couple weeks. 27 City Council Meeting - December 8, 2008 Greg Sticha: It would get you down to about a 4% increase in expenditures, because right now you’re at 5.8. It would get you down to about a 4% increase in expenditures. So you’re expenditures would still go up. Councilwoman Ernst: So you’re saying we need to find an additional roughly $400,000 to get to a zero in the general fund? Greg Sticha: Spending, based on. Mayor Furlong: In addition to. Todd Gerhardt: The 150. Councilwoman Ernst: In addition to the 142, right? Todd Gerhardt: 58. Councilman Litsey: The 158. Councilwoman Ernst: Oh right, you’re right. Mayor Furlong: The 142 plus the 158. Plus an additional 400. Greg Sticha: Right. Mayor Furlong: Is that? Greg Sticha: Yeah, to get to a zero percent expenditure increase you would need to go from staff’s recommendation, which is this item here. You would need to find an additional $540,000. Now if you take away the additional 42 plus the 158, which is 200,000 you’d have to find an additional 340,000. Councilwoman Ernst: So how do we get it flat with last year? Greg Sticha: To get expenditures, to get expenditures completely flat with last year you would need the 340 plus the 42 plus the 150. Well plus the 42 plus the 158. Todd Gerhardt: And if you’re asking specifically what we would cut, you know we would have to sit down and go the options on that and. Councilwoman Ernst: And I understand that. Todd Gerhardt: But it definitely would be you know service level positions. Councilman Litsey: It’d have to be people. There’s nowhere else to cut. 28 City Council Meeting - December 8, 2008 Mayor Furlong: Okay. Other thoughts and comments. Councilman Litsey: Well I can just say, I think this budget does reflect our economic times. It’s very fiscally responsible. I’ve had my issues with the budget process more early on and I’m not going to rehash those tonight, but I would like to say that I do commend, I think we have an incredibly talented staff in many ways. Not just on the budget, but this is just another example of how you really worked the numbers and allowed it to put it out there for us to really understand. And I think especially this later half of the budget process, I think the council really has worked hard to understand both you know the revenues and expenditures and where we can lean things out. Where it’s not reasonable to do that. I mean quite honestly with this 2.4, which is probably for me a little lower than I feel comfortable with, but we’ve identified some things here that we can fall back to if need to. If revenues come up short or expenditures go a little high and so that gives me a better comfort level. But we’re looking at basically for the majority of residents, no increase in their city property taxes, or actually lowering them in most cases and so I think that is fiscally responsible, and we do still need to maintain reasonable services and I think to the hard work that’s been done here, we’re still addressing some law enforcement needs. We’re addressing some road needs. We’re addressing a multitude of things and yet maintaining a very conservative budget so I’m prepared to support it at this time. Mayor Furlong: Okay, thank you. Other thoughts or discussion. Councilwoman Tjornhom. Councilwoman Tjornhom: Yeah like I commented before, we’ve been working on this since the summer and I think we have cut a lot of fluff out of this budget. I think to Mr. Litsey’s dismay at some point. You know I think everyone here has the right intent of spending our tax dollars wisely, and investing in roads and in law enforcement and in, we just gave environmental excellent awards out tonight to people and so investing in our community and our environment. Those are all things that our tax dollars should be spent doing and that’s what we’re doing. I don’t think we are adding fluff to this budget. I think we are a city that runs lean and mean. I think we’ve proven that time and time again and so I am comfortable with the 2.4 and I am, I just want to thank staff and council for all our, and their dedication and time into producing a budget that is fiscally sound and responsible. Mayor Furlong: Thank you. Councilman McDonald, any thoughts or comments you’d like to share? Councilman McDonald: Well I guess first of all I would like to thank staff. They have done I think a very good job of responding to our comments and there have been times when I know they have been caught in the middle between some of our views and everything on all of this and you’ve been very responsive I think as far as supplying information back to us and you’ve been very flexible as far as calculating numbers so I do appreciate all of your work. You know one of the things I guess that we really need to look at is yes, there is a lot that we can probably do and we should try to get the best bang for the buck for our tax dollars. I’m not you know go into this wanting to tax the residents just willy nilly in all of this, and a lot of thought has gone into it but the thing that I look at is, the City continues to grow so you can’t go backwards and not suffer as far as services. Your level of commitment to the individuals. We’re not a static city and I think 29 City Council Meeting - December 8, 2008 what the numbers have shown is that we’ve had very good growth over the past couple of years. Okay with that growth comes a responsibility of the city responding to individual residents, to services, and all of that means government grows. I don’t like government that grows but if it grows for the right reasons, that’s good and in this particular case I think it is because the city is growing. We’re one of the better communities in the area as far as livability. As far as services that we provide to people and we do it in a very efficient manner. The water is a good example. We have what 4 employees that maybe run our water plant. You go over to Eden Prairie and there’s got to be at least 20 or more. You know we have done a very good job of trying to staff everything to get again the best bang for the resident’s dollars. So I’m very happy with the 2.4 because what that means is that, in effect you’re not going to see an increase in your taxes, and in some cases it will go down. Where it doesn’t that may be somewhat due to the valuation that the county puts on your residence, which we can’t really control or depending upon the school district that a resident lives in, there’s going to be fluctuations there but for the most part I think we are recognizing the fact that these are difficult times and you know going forward we’re trying to make sure the city is here to work for the residents at the most affordable cost that we can come up with so I’m very proud to support 2.4. I think that the flexibility is in that. One of my concerns was that again if the revenues are down next year, where do we turn to for money and I think that what staff has done, they’ve done a good job of identifying, at least to me there are areas in there that we can look at in the future and that we have options. I wanted to make sure that we had options so I think that again staff and Mr. Gerhardt have done a wonderful job of putting together the budget and listening to all of us so I can support this and I just want to say thank you again for all your very hard work. Mayor Furlong: Thank you. Anything else? Councilwoman Ernst. Councilwoman Ernst: Yeah. In my own conscience I can’t support a 3% increase budget, nor a 2.4% levy, and I would like staff to go back to see what they could do so that we don’t have to increase spending and so we don’t have to increase the tax levy, and therefore I cannot support the 5.8% budget, nor the 2.4% tax levy. Mayor Furlong: Okay. Thank you. My thoughts on the budget I think is you’ve heard we’ve spent a lot of time, number of months. Many meetings. Very good discussions. Some healthy discussions. All very good. There obviously these are decisions, these are debates about where our priorities are. How do we prioritize our limited resources that we have, and that’s why we take so much time. We didn’t just start this process last week, but we take time to make sure that all the issues get out on the table. I think the budget before us this evening is where I had expected we’d be at this time because it does provide an appropriate level of services. While reducing some service levels from what we did before, but still an appropriate level of services in those core areas of government that we provide the public safety and the planning, development, parks and recreation and engineering and not only on the general fund but the municipal utility services as well. And it does it in a way that it also continues our tax policy of limiting the levy growth to the real growth in the tax base. Not the inflationary growth. Many cities include both the real and inflationary growth in their levy calculation. We don’t and we haven’t and the difference means, and that’s why one of the slides that Mr. Sticha put up earlier showed that the tax rate continued to decline. During the run up of real estate prices the inflationary run up that we saw earlier in this decade, many cities were continuing to increase their levy at that same rate. 30 City Council Meeting - December 8, 2008 We did not. The rate of growth has been limited to, or less than the real growth in our tax base. In 2008 we’re fortunate to continue to be a growing city and yet even though our tax base is going to 2.4%, we’re still able to cover not only the real growth and services that we talked about this evening. Adding some police services that have been added in recent years and some other areas as well in our budget, but also the inflationary costs that we have. We’ve got a very, a very good budget here. A good balance between the two and that’s ultimately what we’re looking for. I think it’s based on realistic assumptions and based upon the current and the best information we have. But we all know that that information is changing unfortunately daily and sometimes hourly it seems now which is providing a lot of concern and angst for many people and that’s why as much I think we’re on solid footing approving this budget this evening, our real concern is going to be the budget for 2010 and looking ahead to next year’s budget. That’s going to be the challenge and that’s why when we talk this evening, I think a mid-year review of this budget is something that we need to do this year, more than ever because of the ongoing changing economic environment. And at the same time we’re going to need to be looking ahead, as soon as we start getting some of that information at the 2010 budget. That’s going to be the biggest challenge and I think, but as we said earlier tonight, we’ve got time to wait for better information before we start making those decisions and I think we need to take advantage of that. You know this budget, in talking to some residents, there’s a lot going on over in St. Paul, and we’re probably going to hear about some of that in a few minutes, but a lot of concern there and one decision that we made early as a council, that’s consistent with last issues, or budgets in the prior years is that we do receive the market value homestead credit funds from St. Paul. Those started coming in a few years ago. We have not included any of those in our general fund budget, from a budgeting standpoint. We are not budgeting any staff salaries or any other service levels based upon what might or might not come from St. Paul. I don’t know that all cities are doing that, but in this city we need to because it’s part of being prudent and fiscally responsible. When you have an uncertain source of revenue, you don’t plan on a certain source of expenses associated with it, and that’s what we’re doing so. Are there differences? You know some people may want to spend more in some areas. Some people may want to spend less. I think that’s always going to be an ongoing debate but I don’t think it takes away from the quality of the information and what’s being presented before us this evening. I think it’s a good strong realistic budget. It is, provides appropriate level of services and does it in a way without increasing taxes, and I think that’s a, that is a strong budget and one that I’m proud to support. Before I finish, there have been some thank you’s but I want to reiterate my appreciation not only to staff. Certainly to staff for all their work and hard work over these many months but also to the council for sitting through the discussions and having the opportunity to share our thoughts with one another and listen to one another. We may not always agree but we can certainly listen until we understand each other’s issues and then see, bring our own experiences to bear as well, so I thank everybody that was involved in the process. I think the end result is the key and I think this process brought us to a good end result. Councilwoman Ernst: Mayor I need to make a correction. I said that I could not. Mayor Furlong: Councilwoman Ernst. Councilwoman Ernst: I could not support the 3% increase in the budget. I meant 5.8. The correction is, for Forrest’s information. Not support a 5.8% increase. 31 City Council Meeting - December 8, 2008 Mayor Furlong: Okay. Thank you. Any other thoughts or discussion? If not, there was a request to, any questions or thoughts on the CIP? If not let’s go ahead and consider a first a motion relating to the levy and general fund expenditures. Councilman McDonald: Okay, I’ll make a motion Mr. Mayor. That the City Council adopts a resolution establishing the 2009 final levy at $10,074,565 and approves total general fund expenditures of $9,859,100. Mayor Furlong: Thank you. Is there a second? Councilwoman Tjornhom: Second. Mayor Furlong: Made and seconded. Any discussion on that motion? Request for clarification. If not we’ll proceed with the vote. Resolution #2008-69: Councilman McDonald moved, Councilwoman Tjornhom seconded that the City Council adopts a resolution establishing the 2009 final levy at $10,074,565 and approves total general fund expenditures of $9,859,100. All voted in favor, except Councilwoman Ernst who opposed, and the motion carried with a vote of 4 to 1. Mayor Furlong: Motion prevails 4-1. Let’s go ahead with a motion on the CIP. Mr. McDonald. Councilman McDonald: I also make a motion that the City Council adopts the following motion. It also approves the CIP for 2009-2013 in the total amount of $65,641,110. Mayor Furlong: Thank you. Is there a second? Councilwoman Tjornhom: Second. Mayor Furlong: Made and seconded. Any discussion on that motion? Resolution #2008-70: Councilman McDonald moved, Councilwoman Tjornhom seconded that the City Council approves the 5 year Capital Improvement Program (CIP) for 2009- 2013 in the total amount of $65,641,110. All voted in favor and the motion carried unanimously with a vote of 5 to 0. Mayor Furlong: That motion prevails 5-0. Very good. Thank you everyone. Appreciate everyone’s involvement and thoughts and comments. At this time we have the pleasure this evening to welcome Minnesota State Senator Julianne Ortman to discuss council. Good evening Senator. VISITOR PRESENTATION: SENATOR JULIANNE ORTMAN, 2009 LEGISLATIVE UPDATE. 32 City Council Meeting - December 8, 2008 Senator Julianne Ortman: Good evening Mayor and council members. It’s good to be here. This is the sixth city of the 10 that I’m visiting before I go back to session in January, and based on the conversation I’ve just heard, my timing is pretty good. These are difficult times and government is for the faint of heart and our residents are so well represented. It’s a greater pleasure for me to come here tonight because this is my city and I’m really proud of the discussion that you’re having about our budget. Really proud of the outcome on behalf of the citizens and on behalf of my family. And the fact that you have such an open conversation and the opportunity to disagree because those voices of disagreement do have an impact in the outcome, and so on behalf of myself and my family and residents I really appreciate that. And just a word to Councilwoman Ernst, in all the budgets I’ve voted for, I think I voted yes on one so you have company. Councilwoman Ernst: Thank you. Senator Julianne Ortman: Let me just say that this is a tough year. Tough for the city. Tough for the schools. Tough for the watershed districts. Tough for our county partners, state and federal. The state just recently announced it’s $5.2 billion deficit. We all know where that comes from. It comes from the fact that we have record unemployment. We have record numbers of foreclosures across the state and across the country, and record decreases in consumer spending, and as a result we have property taxes that, and revenues that are declining and we have personal income taxes that are falling. We have other sources of revenues like our sales taxes. We just raised those. The revenues are still, they’re falling. Corporate tax revenues, they’re down, and that’s what leads to our budget deficit for 2010 and 11 but it still leaves us with a budget deficit for this biennium, 2008 and 2009. So most of that budget deficit of the 5.2, most of that is seen in 2010 and 11. A little less than half, or $500 million is in the 2008-2009 biennium and we begin on Wednesday in the Senate Tax Committee to talk about how do we address this. The Governor has already in gold, or hinted through his finance commissioner that there may be unallotments. And for those that don’t know, that could be the Governor through executive order cutting the budget. There’s a look right now at the aids and credits to cities. Local government aid. Counties. There’s a payment that goes out, I believe it’s $305 million on th December 24 and the Governor has his eyes on that right now to say if we’re going to make some changes to come up with that $500 million or so by the end of 2009, we may need to cut immediately. So the tax committee will convene on Wednesday at 10:00 a.m. to hear testimony from cities and counties that are affected by the potential proposals to cut budgets for 2008-2009 and beyond and so I wanted to invite you to come. You know I’m really proud of our city but I have to say we are very self sufficient here. You are very self sufficient. You don’t get a lot of aid and credit and when you do, you don’t rely on it. It’s not part of your general fund expenditures and so you operate very well here. We hear from the squeaky wheel. We hear from the cities in crisis. We hear from the cities in need. We hear from cities that are having, experiencing huge growth or declining population. The ones facing real challenges and we don’t hear often from the ones that are succeeding in going through the process that you just did. And those especially that take it upon themselves to succeed with or without the state’s help. You still need to be heard at the State Capitol and I hope that you’ll consider coming to testify Mr. Mayor or any of you council people. You have a great impact when you come to the State Capitol. Your City Manager is very welcome, and so I hope you will pick time early in January- February to work with me to represent some of the cities that are functioning so well. We need 33 City Council Meeting - December 8, 2008 to hear from you as well. I have to say that one of the messages that I’ve been trying to get out this year is that we’re in this together. These are not easy times. I’ll tell you that when we passed the budget last year, it was one of those budgets I voted no on because we spent down the reserve and we increased our spending obligations into 09 and 010 and 011 and that’s why we’re at least partially in this place. And so we have to go back full circle and say how can we change the way we do business in the state of Minnesota. How can we make the drastic changes we need so that we can balance our budget in the future, and I have to say the City of Chanhassen sets a very good example of how you’ve been able to create financial sustainability and that might be one of the reasons, one of the things you come and talk about at the State Capitol is how have you created financial stability in the City of Chanhassen and what does that model look like because we haven’t seen it at the State Capitol. So this year we’ll go back and we will try to find ways to cut but cutting spending will not be enough to deal with the deficit. There’s just no way. So you either have to change the way government approaches funding, or else you have to cut government spending and also raise revenues, and we know we have a governor that disinclined to support increased revenues. There may be some other things at play. One is perhaps the expansion of the sales tax. I know you’ve all probably read about that. Potential of repealing some of the tax credits for corporations, but it will be some drastic discussions about how we deal with this and so please don’t, don’t be disconnected from us. That’s why I’m here. To reach out to you to say, we need to hear what you have to say. I need to know what the City of Chanhassen thinks. I need to know what the residents of Chanhassen think when I go back to the capitol to try to bring our point of view to bear. It’s one of the great fortunes I have serving in the senate is I feel like I have a great support mechanism behind me but now it’s time for the support to kick into high gear because we’ve got some serious business to accomplish at the state. And as I said at the outset, we’re in this together. There have to be, I know there are. I’ve heard it in other cities but there are mandates that the state has set for the cities that either are unfunded and unaffordable, or they might be funded but they’re not providing value. They don’t provide value to the residents. They don’t, they aren’t worth the money you spend and so I came to proactively ask you. I’m on a mission, what are they? I don’t know what they are but I know that the folks, your staff folks in this room know what they are. I know you have a pretty good idea and I need a list. I need to go back to the capitol and explain where we can cut out of our budget, where we can help you with your budget succeed by repealing some of those unfunded mandates. But now is the time for us to create that very strong partnership where I can go back with Paul Kohl’s or Joe Hoppe or anyone of the house members and start the discussion about what we can do so that your budget discussion isn’t pressed to the limit. So that cities across the state can succeed and find ways to save money with mandates that they no longer need to afford, because their residents don’t find the value in them and I think there are many of them that must affect the city of Chanhassen. So I’m here to say let’s talk some more. I need more help. I also can do better at communicating what’s happening at the capitol and it couldn’t be more th important than it is in 2009 beginning on January 6. So I’m here to answer any questions if you have any but also just to relay my effort at partnership here with the city. Mayor Furlong: Thank you, and Senator we appreciate your offer and all your services that you’ve provided over the many years for us and for the residents of Chanhassen and we welcome your request for unfunded mandates and I like the funded mandates without value. That’s an important part as well. I know as a council that we met with you last year, early last year and talked about our legislative initiatives and we look forward to doing that again this year and I 34 City Council Meeting - December 8, 2008 know you’ll be available to do that with us, and I think Mr. Gerhardt was, members of the council, that’s one of the things that we can talk about just to get her information. Get the senator information that will help her represent us better as well so. Any other thoughts or questions? Councilwoman Ernst: Thank you for extending the invitation. You never know, I might be there. But I also want to thank you for what you’re doing for us down at the State Capitol. I know that it’s a challenging time and I appreciate everything that you’re doing for us down there so thank you. Senator Julianne Ortman: Thank you. Appreciate that. Councilman Litsey: One of the questions I guess I had that maybe you could answer for me. I had sent you an email back in May and I didn’t get a response but one of the things I said to you, I said City Councils are elected to make decisions about local budgets and community needs and it’s inappropriate for the legislature to undermine local decision making and accountability through the imposing levy limits. Representative democracy should allow us to do that. If we have a true representative democracy we at the City Council level should have the latitude to set budgets and the State really shouldn’t intervene in that. Why is that the State feels that they need to intervene in local government affairs? Senator Julianne Ortman: Mr. Mayor and Councilman Litsey. Thank you for the question. Honestly with this being the sixth city, it’s not the first time I’ve had that question and I welcome it. I stand here as a representative of the state because I serve in the state senate, but I have to tell you I voted no on every levy limit proposal that’s come before the state senate. There have been bipartisan support. There have been bipartisan support of that, including our governor. It’s not something I support. I do agree that you should have the independence to choose what your budget should be and what the levy should be. I believe in local government and I will continue to do that. It may be one of the things that sets me apart from my colleagues, but I know that I’m in line with the cities, including Chanhassen and other cities in Carver County that exercise that freedom and independence extremely well on our behalf so I’ll continue to do so. Councilman Litsey: Very good answer. Thank you. Senator Julianne Ortman: I practiced once before. Councilman Litsey: No I appreciate that and I know when I sent the email that you were in the th midst of the 11 hour trying to decide things so I didn’t necessarily expect a response but I truly didn’t know where you stood on it. Perhaps I should have called you and asked you but I appreciate the opportunity tonight to be able to follow up on that and ask because it’s just to me philosophically a wrong approach and so I’m happy to hear that you support that, so thank you. Senator Julianne Ortman: Mr. Mayor, Councilman Litsey, I think you just identified one of the things you could come and testify about in the capitol so we’re going to sign you up on that issue. 35 City Council Meeting - December 8, 2008 Councilman Litsey: I’ll be happy to. Senator Julianne Ortman: I welcome your partnership. Councilman Litsey: Thank you. Senator Julianne Ortman: I’ve been outnumbered before on that issue. Mayor Furlong: Very good. Anything else? Senator, thank you. Appreciate your time coming this evening and sitting through our discussion earlier. Thank you for waiting. Senator Julianne Ortman: I was happy to hear about your city, our city and the budget. Thank you very much. Mayor Furlong: Have a good evening. COUNCIL PRESENTATIONS: ANNOUNCE RESULTS OF THE CITY MANAGER’S PERFORMANCE EVALUATION. Mayor Furlong: I’d like to start by reading a statement regarding the City Manager’s th performance review. The City Council met in executive session on November 24 and st December 1, 2008 to discuss Mr. Gerhardt’s performance and compensation as our city manager. Following is a summary of those discussions. Mr. Gerhardt has completed another year of excellent work for our city. He has accomplished many of his personal goals and those of the City Council, and together with the City Council and staff coordinated and executed on a number of strategic initiatives for the city. Some of the major accomplishments this year include completing the City’s 2030 comprehensive plan on time through an internally city staff led open and inclusive process. Leading the effort on the city’s mock emergency drill, including successful coordination of multi-disciplined area functions which resulted in a positive, educational experience for all involved and improved the city’s preparation for and a response plan in the event that an actual emergency occurs. Completion of the additions of wells 12 and 13, fresh water wells 12 and 13 and replacement of the failed wells from the summer of 2007 in time to meet the seasonal summer demand in 2008. Substantial completion of both the Lyman Boulevard and Laredo Drive street reconstruction projects while minimizing the inconvenience to residents and businesses in the project areas. Continuing to improve our city’s financial position, planning process and outlook as best exemplified by Standard and Poor’s two step bond rating increase from a AA- to AA+. A level that is enjoyed only by the strongest and most financially and operationally sound cities in the state and the country. In consideration of his performance the City Council discussed increasing Mr. Gerhardt’s compensation in 2009 above that which he received in 2008. Based upon those discussions and in view of his financial performance, in a moment I will ask the City Council to approve a 4% increase in Mr. Gerhardt’s compensation for 2009 as we discussed in our executive session. But first I want to invite other members of the council to provide any comments that they might have regarding Mr. Gerhardt’s performance as city manager. Council members? Councilwoman Ernst: I would like. 36 City Council Meeting - December 8, 2008 Mayor Furlong: Councilwoman Ernst. Councilwoman Ernst: To again congratulate Todd and Greg on doing such a fine job on the AA+ level. I also believe Todd that you’ve done a great job in leading the city, and we’ve talked about those. Those were mentioned in your review and so the fact that, and this is not a surprise to the rest of the City Council members. The fact that I did not support a 4% increase has nothing to do with your performance. It’s all about financial stability and where we are. So good job and congratulations. Todd Gerhardt: Thank you. Mayor Furlong: Mr. McDonald. Councilman McDonald: Well I guess I would just say you know congratulations. I know you’ve been climbing a steep hill but what I’ve got to tell you is you haven’t reached the plateau. The hill’s still going up and it’s going to get even worst I think. Todd Gerhardt: What have you done for me lately? Councilman McDonald: Yeah, it’s going to be even more challenging for you I think next year in this current climate so I look forward to working with you and I’m sure you’ll help lead us through this mass of problems that the whole nation is going to face so I have a lot of confidence in you and again congratulations. Mayor Furlong: Councilwoman Tjornhom. Councilwoman Tjornhom: Well the man who gave me this room for comments was kind of like a who’s who when he was reading your accomplishments but you know I think one of the things that makes you a real valuable employee and a city manager for Chanhassen, I’ve always though this is your relationship with the community. You have a real sense of community leadership. You are working with the community leaders and you just have a, kind of a heart beat and a pulse on what’s going on out there and that’s back to us and it helps us make good choices for our town and so I think that’s one of the areas that is invaluable when it comes to you, is your relationships that you’ve built with the community leaders and businesses in our town and also just the way you handle I would say maybe one of the issues was the Dinner Theater this year and how well that, how well you handled that and so my kudo’s to you on another job well done for the year and like Councilman McDonald said, you have a steep hill to climb this year so we’ll all have to put our hiking boots on and follow you up that hill so. Todd Gerhardt: Look forward to it. Mayor Furlong: Councilman Litsey. Councilman Litsey: Just don’t fall backwards. Well everybody pretty much has reflected what I guess I was going to say but, you know when we were doing the review and looking back at all 37 City Council Meeting - December 8, 2008 the accomplishments that you’ve helped with the leadership on this past year, it’s pretty incredible and I know that you had a good team assembled and they deserve a lot of credit too but one other thing that really impresses me is how well everyone does work together. You know department heads and staff and you can just tell there’s a comfort level there. People are trying to work together to achieve a goal, not competing against each other and that’s real valuable and I’ve worked with a lot of city administrator, managers in my other job and you’re one of the best, if not the best that I’ve worked with so I think the City of Chan is really lucky to have you and the team that you’ve assembled here and makes our job a lot easier so thank you and this is well deserved. Todd Gerhardt: Thank you. Councilman Litsey: You’ve worked hard for it. It just isn’t being given to you so. Todd Gerhardt: Appreciate it. Mayor Furlong: Todd any thoughts? Todd Gerhardt: Well you know it’s a team effort. I think you kind of hit it on the head. I do have a great team behind me and if we’re going to go up the hill and I do stumble, I’ve got a lot of support behind me. The department heads we have here, hopefully no other city’s listening because I’d hate to see any of them leave this community because this community is very lucky to have the professional staff that you have here. I mean certified engineers. Most of them have masters degrees and are very professional so. And also the leadership of the council makes my job a lot easier. Communication. You know we may not always agree and it’s my job to try to direct you in a direction when we may not all want to go in the same direction, but I think everybody is respectful. I believe in the system that we have. Challenging each other just makes us stronger and it makes us think through things so you know I think tonight was a good example of that and it makes you think outside the box when you challenge each other. So I think any of my staff would say they’re not afraid of being challenged and looking for opportunities and I think the system that we have in place and creating the priorities and goals is one that gives us direction but also plays a big factor for mayors and councils to get the tasks done that they want to see done. Each year you have the opportunity to list out what your goals and aspirations are for this community, and then we prioritize them and you know being in this business for 23 years, I’ve seen a lot of council members just be frustrated that they weren’t heard or didn’t get a task done or a goal, and I think this system really allows that to be put out there and for you to have the opportunity to see those done so thank you. Thank my staff and Senator Ortman and Representative Hoppe. We’ve had a lot of communication over the last few years and they help us too. It’s just not a local thing. It’s county, other cities and meeting with those individuals as leaders is great insight in what other people are going through so I know the state has big problems coming up in trying to balance their budget for the next coming 2 years. That’s a task and my heart goes out to Senator Ortman and Representative Hoppe in trying to deal with that issue, and whatever we can do to help, we’re here for you because you’ve always been there for us and that’s all I have to say. I think we’ve kind of covered this one… Councilwoman Tjornhom: Except you probably want to have a transcript for your wife tonight. 38 City Council Meeting - December 8, 2008 Todd Gerhardt: She’s probably watching. She’s probably watching. Mayor Furlong: Let me just finish up by saying I’m glad you recognized everyone else who’s in the council chambers, the direct reports here tonight especially and as I was preparing comments here based upon our discussion, this is not a one man show and I want for all the, for Greg, Paul, Todd, Kate, everybody else, Laurie, everybody else in the room, and even. Todd Gerhardt: Nann. Mayor Furlong: All the city employees. Nann. All the city employees. This is everybody working together in the same direction that produces these results and while our form of government that we have, the City Council reviews the City Manager and that’s what we’re doing tonight from an agenda standpoint. We fully recognize and thank and appreciate all the efforts that everybody does because just us or just Todd, or even just you, none of us individually could get everything done that collectively we’ve gotten done and that’s really is what makes the difference is how well all of us are able to work together. Todd as a city manager, you play a key leadership role in that position. That’s why we’re grateful for you and proud of the service that you provide and we look forward to, wish you every success in continuing to work with us so thank you for that. At this time then I would move that the City Council approve a 4% increase for Mr. Gerhardt’s compensation for 2009 as we discussed in our executive session. Is there a second? Councilman McDonald: I’ll second it. Mayor Furlong: Thank you. Is there any discussion on that motion? Seeing none we’ll proceed with the vote. Mayor Furlong moved, Councilman McDonald seconded that the City Council approve a 4% increase for the City Manager’s 2009 compensation. All voted in favor, except Councilwoman Ernst who opposed, and the motion carried with a vote of 4 to 1. Mayor Furlong: Very good, thank you. Todd Gerhardt: Thank you. Mayor Furlong: Any other council presentations this evening? No? Okay. ADMINISTRATIVE PRESENTATIONS. Todd Gerhardt: This being our last meeting for the year, I’m not going to bore you with any more comments so thank you again for a fantastic 2008. I think we did get a lot of our goals accomplished for the year and I give you next 3 to 4 weeks off and hit it hard here when we meet th again January 10 to start talking about 2009 goals and looking to prioritize those. 39 City Council Meeting - December 8, 2008 Mayor Furlong: Very good One comment that I forgot to make and I’m going to back up is we had a event this last Saturday at City Center Park which was very well attended, even though it was a little cold. When all the lights came on in the city to celebrate the city Christmas tree as well as the lights in the park. It was a tremendous turn out. We had good support from some of the local businesses that helped sponsor the event, as well as the Chamber and some of the Chamber members as well, and so we appreciate all the sponsors and all the work that the city staff did in getting that park really to look nice and something that we all can be proud of so if you have an opportunity to drive by the park in the evening, or take a stroll through it and really enjoy a great amenity that the city has. Very good. If there’s nothing else to come before the council this year, we wish everyone a Merry Christmas, Happy New Year. Enjoy the holidays and if there’s nothing else to come before the council, is there a motion to adjourn? Councilman Litsey moved, Councilwoman Ernst seconded that the City Council adjourn the meeting. All voted in favor and the motion carried unanimously with a vote of 5 to 0. The City Council meeting was adjourned at 9:05 p.m. Submitted by Todd Gerhardt City Manager Prepared by Nann Opheim 40