WS 2011 10 24
CHANHASSEN CITY COUNCIL
WORK SESSION
OCTOBER 24, 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
PUBLIC PRESENT:
Susan Duchon Buy Chanhassen Group
Jeff Fox 5220 Howards Point Road, Excelsior
Rick Dorsey 14215 Green View Court, Eden Prairie
UTILITY RATE STUDY REVIEW, EHLERS AND ASSOCIATES.
Greg Sticha provided background information on the annual review of the utility rate study. Mark Ruff
with Ehlers and Associates presented the results of the study, noting the lifespan of a rate study is about 2
to 3 years. Key findings showed moderate rate increases are needed in 2012 to pay for operation costs
and capital improvements, noting rates have not increased since 2010. In reviewing water utility demand
for 2012 through 2018, examples of proposed water rates for Tiers 1-5 and the impact on low, average
and high residential and commercial customers was shown, the impact on the city water fund through
2019, and water connection fees. Councilwoman Tjornhom asked why the City needs a 6 month cash
reserve and what kind of growth is needed to trigger building of the future water treatment plant.
Councilwoman Ernst asked about the effect on the water rate structure by pushing construction of the
future water treatment plant out to 2020-2022 instead of 2018. Todd Gerhardt asked staff to prepare a
chart showing the effect on rates if the water treatment plant is delayed or not built. Council and staff
discussed the effects of growth versus costs and fees. Councilwoman Ernst asked if there were other
ways to fund capital improvements i.e. future water treatment plant rather than using water utility fees.
Councilman Laufenburger discussed bonding for the water treatment plant. Staff explained that sanitary
sewer rates are proposed to have a 3% increase in 2012 to meet anticipated Met Council rate increases,
the impact on the city’s sewer fund through 2019 showing cash balances drifting downward and sewer
connection fees. Staff explained that the storm water rates are proposed to increase 3% per year for 2012
through 2013, noting this is one area where the City is meeting target reserves. Greg Sticha showed the
total impact on the average quarterly utility bill and comparisons to other communities. Council
suggested using the city’s key financial strategy cities as comparisons in the future.
THIRD QUARTER FINANCIAL STATUS UPDATE.
Greg Sticha provided a report on revenue and expenses through the third quarter, explaining projected
expenditures are going to finish at or slightly below budget, that building permits are above projected
numbers and an analysis of the City’s investments portfolio. Mayor Furlong asked for clarification of the
difference between book yield and market yield. Councilman Laufenburger asked where in the report
unrealized gains are shown. Council members expressed appreciation for the quarterly updates.
City Council Work Session – October 24, 2011
UPDATE ON TH 5 IMPROVEMENTS FROM TH 41 TO CR 11.
Paul Oehme presented an update on the status of the TH 5 improvement package including background
information on neighborhood meetings, project overview and the road closure schedule during
construction. Councilwoman Tjornhom asked about detour routes for school buses. Councilman
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Laufenburger asked about the use of 82 Street as a detour route, if there will be public meetings prior to
construction to explain road closures, and if MnDOT holds those meetings, getting information out to
affected businesses and neighborhoods. Mayor Furlong asked what the City of Chanhassen can do to
assist businesses in Victoria during the six week road closure. Paul Oehme reviewed the approval process
with construction slated to begin in April, 2012 and completed by October, 2012. Councilman McDonald
asked about the impact of the road closure on the Arboretum. Councilman Laufenburger asked if there
was anything that would prevent this project from going forward.
REVIEW SCHEDULE FOR CITY MANAGER’S PERFORMANCE REVIEW.
Mayor Furlong reviewed the process and proposed meeting schedule. Councilwoman Ernst suggested
Todd Gerhardt submit a self review outlining his strengths and weaknesses. Mayor Furlong suggested
that is what his work plan accomplishes. Councilman Laufenburger would prefer not to have a self
review from Todd Gerhardt when making his assessment. Councilwoman Tjornhom and Councilman
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McDonald stated they did not see the benefit of it. Key dates for meetings are December 5 and 12 for
executive sessions. Councilwoman Tjornhom volunteered to collect the evaluations. Council decided 4
to 1 that the City Manager not do a self review.
Mayor Furlong adjourned the work session at 7:00 p.m.
Submitted by Todd Gerhardt
City Manager
Prepared by Nann Opheim
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