WS 2011 09 26
CHANHASSEN CITY COUNCIL
WORK SESSION
SEPTEMBER 26, 2011
Mayor Furlong called the work session meeting to order at 5:35 p.m.
COUNCIL MEMBERS PRESENT:
Mayor Furlong, Councilman McDonald, Councilwoman
Tjornhom, Councilwoman Ernst, and Councilman Laufenburger
STAFF PRESENT:
Todd Gerhardt, Laurie Hokkanen, Paul Oehme, Kate Aanenson, Todd Hoffman,
and Greg Sticha
EXPLANATION OF COMPENSATED ABSENCE PAYABLE.
Councilwoman Ernst passed out a summary of city employees information regarding compensated
absences that she and Brad Hagemaier had prepared. Greg Sticha reviewed what compensated absences
are and the fact that it does not have an impact on the 2012 budget. He explained how compensated
balances are paid to employees and that the council could set up a reserve fund but does not see the need
to do that for a city of Chanhassen’s size. Dave Mol with Redpath and Tautges, the City’s auditing firm,
was available to answer questions on other cities’ policies. Councilwoman Ernst asked for an explanation
of how a long term employee is compensated when they leave employment. Councilman Laufenburger
asked if there were state statutes governing how compensated absences are paid. Councilwoman Ernst
thanked Laurie Hokkanen and Greg Sticha for answering her and Brad’s questions before reviewing the
information compiled in their summary of all the information received and how a 1.5% pay increase and
15% health insurance increase will affect the general fund. Councilman McDonald asked about privacy
issues involved with preparing spread sheets with individual employees information. Councilman
Laufenburger concurred that the City should be diligent about not leaking information on individual
employees. Councilwoman Tjornhom expressed having a problem with the information being prepared
by an individual other than city staff. Todd Gerhardt explained how staff is following policy set by
previous councils to arrive at the total dollar amount in the budget. Mayor Furlong stated the key point is
if the amount set forth for accrued compensated time is accurate. Dave Mol explained it was accurate at
the time of the audit. Councilwoman Ernst asked for the average increase/decrease in compensated
absences from 2010 to 2011, the need to make sure the City has the money in the budget to fund it in the
future and asked where the source of money comes from in the general fund. Dave Mol explained the
different fund balances noting the City does not have a formal policy but implied policy on dealing with
compensated absences. Todd Gerhardt explained that in the past 11 years there’s only been one year
when the budget was over due to lower than expected building permit revenues. Councilman
Laufenburger asked for a history of annual payments of compensated absences versus money saved.
Councilwoman Ernst explained her issue with not discussing the $948,000 lump sum payout and the need
to know that it’s there as an outstanding debt. Greg Sticha explained that the City has the assets to cover
that liability if needed and when auditors do their audit in June they will address that issue.
REVIEW PAID TIME OFF (PTO) VS. SICK/VACATION BENEFITS.
Laurie Hokkanen explained the City’s sick/vacation accrual policy in comparison to other key financial
strategy cities, noting Chanhassen was comparable in the rate of accrual for sick time but would
recommend changing vacation accrual time to 2 times versus the current 3 times. Councilwoman Ernst
asked about average accrual versus what other key financial strategy cities do. In discussing the 600
maximum annual accrual for sick time, Mayor Furlong explained the reason for 600 maximum is in lieu
of the City carrying short term disability insurance, which costs approximately $52,000 yearly per
employee. Todd Gerhardt provided background information on why paid time off (PTO) was
City Council Work Session – September 26, 2011
implemented. Councilman Laufenburger provided clarification of PTO versus short term disability
insurance. Laurie Hokkanen explained staff is not proposing any changes to the sick leave policy of
accruing 1 day per month with a maximum of 600 hours per year. Councilwoman Tjornhom asked about
exchanging hours with other employees. Councilwoman Ernst asked why salaried employees would get
sick time, and when the cap on sick pay and overage paid to the post retirement health plan was last
discussed. Mayor Furlong noted that from the information received from staff the City’s current sick time
is comparable to other key financial strategy cities. Councilman Laufenburger stated it would be
interesting to know how many employees are at the 600 maximum. Councilman McDonald asked how
the 600 hours are reimbursed at retirement. Council members concurred that the sick time policy did not
need to be changed except Councilwoman Ernst who felt the 600 hours was an exorbitant amount. In
discussing changing vacation time accrual from 3 times to 2 times, Mayor Furlong asked council
members to comment on making the change and how to deal with a transition period. Councilwoman
Tjornhom agrees with staff’s recommendation of 2 time and felt the employees could chose how they
want to make the transition. Councilman Laufenburger supported the change from 3 times to 2 times.
Councilwoman Ernst suggested a change with a maximum of 2 times. Councilman McDonald favored
the change but was not sure 2 is the right number based on comparisons with key financial strategy cities
and that maybe 1-1/2 times is more reasonable. He stated he was not in favor of a buyout of vacation
time but the need to discuss the transition period. Mayor Furlong agreed with moving from 3 times to 2
times that will go along with a chosen transition option. In discussing the transition period, Councilman
Laufenburger discussed that vacation time is a benefit that employees should be encouraged to use. After
comments and discussion council concurred to ask staff to provide more information on the impact to
employees so that council can discuss a policy change.
G.O. WATER REFENUE REFUNDING BOND SALE REPORT.
Greg Sticha reviewed the results of the G.O. Water Revenue Refunding Bond sale which has been added
under the consent agenda, as recommended by the City’s bond attorney.
The work session meeting was recessed at 7:00 p.m. It was reconvened at 7:25 p.m.
UPDATE ON TH 41 TRAIL AND UNDERPASS.
Todd Hoffman introduced Marty Walsh, Carver County Parks Director and Mike McGarvey with SRF
who provided background information on the project, trail alignments along TH 41 and in Lake
Minnewashta Regional Park, breakdown of the Joint Powers Agreement regarding trail inspection and
shared construction costs, funding, and the schedule for review and construction. Councilman
Laufenburger and Mayor Furlong asked about the time frame for closing TH 41 and costs associated with
partial closure versus total closure. Mayor Furlong suggested coordinating road projects with detour
routes. Councilman Laufenburger asked for clarification of the specifications for trails inside and outside
of Lake Minnewashta Regional Park and cost sharing percentages. Councilwoman Tjornhom asked about
responsibility for maintenance of trails. Councilwoman Ernst asked about feedback from neighbors.
Councilman Laufenburger asked why costs have increased so much from the estimated project review,
clarification of the Transportation Enhancement (TE) approval process, and the purpose for the trail
connection from Longacres to Minnetonka Middle School West. Mayor Furlong expressed concern with
the proximity of the trail to TH 41 in relation to snow plowing and runoff issues, suggest decorative
fencing along the lake, and asked about safety concerns with the culvert and trail intersection. Todd
Gerhardt asked that the joint powers agreement include plans and specs. Marty Walsh addressed the issue
of tree loss associated with trail construction.
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City Council Work Session – September 26, 2011
DISCUSS LEASE OF OUTBUILDING AT 1591 PARK ROAD TO BENIEK PORPERTY
SERVICES.
Laurie Hokkanen explained the terms of the one year lease for the outbuilding at 1591 Park Road to
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Beniek Property Services for cold storage, noting they would like to move in by Oct 15. Councilwoman
Tjornhom asked if renting the property would affect the sale and the amount of interest in buying the
property. Todd Gerhardt explained that there’s been more interest in leasing the property than buying it.
Council members were comfortable with putting this item on the next agenda for approval.
MINNESOTA RIVER FLOOD MITIGATION STUDY.
Paul Oehme provided an update on the Minnesota River crossing options which addresses concerns with
TH 101 and TH 41 flooding issues, explaining the purpose of the project is to identify a feasible design
options at each river crossing to minimize risk of flooding without causing an increase in the 100 year
floodway elevation. He reviewed cost analysis for crossing improvements, details of bridge
improvements, and trail improvements associated with the two highways. Mayor Furlong asked if there
was a difference in design for a county versus state highway. Councilman Laufenburger asked if both
projects will be approved or one over the other and who will make that decision. Paul Oehme clarified
that there’s only funding available for one project and the decision should be made within a couple weeks.
Mayor Furlong asked about city and MnDOT funding for this project.
Mayor Furlong adjourned the work session meeting at 8:45 p.m.
Submitted by Todd Gerhardt
City Manager
Prepared by Nann Opheim
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