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CC Special Meeting 2003 09 15CHANHASSEN CITY COUNCIL SPECIAL MEETING SEPTEMBER 15, 2003 Mayor Furlong called the meeting to order at 4:20 p.m. The meeting was opened with the Pledge to the Flag. COUNCILMEMBERS PRESENT: Mayor Furlong, Councilman Labatt, Councilman Ayotte, Councilman Lundquist and Councilman Peterson STAFF PRESENT: Todd Gerhardt, Justin Miller and Bruce DeJong APPROVAL OF 2004 PRELIMINARY TAX LEVY. Public Present: Name Address Janet & Jerry Paulsen 7305 Laredo Drive Bruce DeJong: Mayor Furlong, council members. We're here today to adopt a preliminary tax levy for Truth in Taxation purposes. This is what will be reflected, am I picking up? Is that better? Mayor Furlong: That's better, thank you. Bruce DeJong: We're here to adopt a preliminary Truth in Taxation levy which will be used for purposes of Truth in Taxation statements to be mailed out in November. I've just got a short presentation that I'd like to run through with you, and I'll be open for questions after that. What do we have to do for the Truth in Taxation purposes? We have to adopt a preliminary tax levy for the general fund. This is the amount that comes underneath levy limits and we also have to adopt a tax levy for debt service, which is not underneath levy limits, and we have to adopt a public hearing date and a continuation date in case we don't finish with all the public input on our preliminary date. The State has reserved two days for cities. Those are December 1st and December 8th and they recommend we adopt those dates. The process that we've gone through so far and will complete during the rest of the year is that preliminary budgets have been submitted by the department directors. They've been reviewed by Todd Gerhardt, City Manager and me and we've put together an estimated tax levy. We have to adopt that today, which is the last day and get that certified to the County Auditor. Then we'll have some detailed budget meetings in October and November to finalize the budget numbers. We'll have our Truth in Taxation hearing December 1st and then we'll have the budget and final levy adoption on December 8th. Two things that we've got is debt service. I'll talk about that a little bit. We re-estimated the TIF deficit and it's slightly less than 3.4 million dollars that we would be facing at the end of that district's life. We've identified sources that will pay all the deficit but it does assume that there will be a large excess incremental tums from the county in 2004. And in 2004 the debt levy increase will, oops. That's a typo. That's 2005, any debt levy increase would be mitigated by the downtown TIF districts coming back on line. That will bring us something in excess of a million dollars worth of new taxable value. Actually it will be in excess of 4 million dollars in taxable value which should generate about a million dollars in taxes at the current rates that we have right now. City Council Special Meeting - September 15, 2003 Councilman Lundquist: That's the city portion is a million? Bruce DeJong: That's the city portion, correct. General fund levy is, we're recommending an increase from 191,525. That is in the increase in our levy limit that state will allow. We're still losing over $319,000 of state aid in 2004, which means that we'll have a net reduction or loss if you will of revenues of $127,000. Councilman Peterson: Before you go on Bruce, if we didn't have that in 2003, why would we compare it as a loss in 2004? Bruce DeJong: That's just the first official budget levy that we'll experience. We had adopted our levy already by the time that the state got into their 2004 budget which starts July 1 of 2003. Councilman Peterson: That's where we adjusted our budget to address the issue instead of the levy? Bruce DeJong: Correct. Councilman Peterson: Got it. Bruce DeJong: Debt service levy projection, you can see that that's going to maintain fairly level with the recommended transfer of cash from the general fund. And then in 2005 you can see the net effect of having the TIF district come back on line will be like reducing our debt levy to just over a million dollars. That's reflecting the approximately $1.1 million dollars worth of tax revenue that I believe that district will generate. Net tax levy effect is that we're recommending as a staff recommendation the general fund levy go up to $191,525 to the maximum, raising the debt service levy up $41,975 which is a total tax levy increase of $233,500 which equals the estimated real growth in the tax levy. We had an increase of 2.7 percent in our taxable value, which is new building construction, additions and remodeling's and it seems reasonable to tax that additional tax capacity. The effect on homeowners will be an increase of 1.83 percent and fairly modest dollar increases, and these are the real increases taking into account an increase in home value of 10.5 percent, which is an approximate average increase that homes in the county have seen. Mayor Furlong: The county or the city? Bruce DeJong: Well both the city and the county. Mayor Furlong: And the county was at 10.57 Bruce DeJong: Yep. Their's was actually I think the 250 house went up to 276,625 I think or 650 and my estimate was 276,250 so we're pretty close in the ballpark there. Councilman Lundquist: Bruce this, the effect on homeowners, that's the reason that you're showing an effect there, is that the commercial devaluation that you talked about in the packet report? Bruce DeJong: Correct. The point, there's two things that are affecting why an average home would see a slight tax increase. One of those is that the relative percentage of property value has gone I guess in favor of commercial industrial property and against the homeowner. Commercial industrial properties, due to vacancies, are generating less income. They're generally valued on 2 City Council Special Meeting - September 15, 2003 an income basis. So we've experienced a number of CI properties that have gone down in value. That is just barely offset by the increase in new commercial industrial construction, so what's happened is the relative levels have changed and so the homeowners are going to have to pick up more of the burden. And the second effect is that we have two different types of tax levy. One of them is based on market value and one of them is based on tax capacity. The general tax levy and all of our special assessment debts are based on tax capacity. Tax capacity, the rates are 1 percent for homes under $500,000 and 1.25 percent for homes over $500,000. For commercial industrial properties they're based on 1 t/2 percent for anything under $200,000. Anything over $200,000 is based on 2 percent, so they basically shoulder twice as much of the burden on an average commercial industrial property compared to a residential property of the same value. What's happening now is that our referendum debt is based off of market value. That was something that was passed by the legislature a few years ago as one way I guess to mitigate the burden bom by commercial industrial properties when new referendums have been passed, either by cities or by school districts so that homeowners will see the full effect of passing those referendums. So we've got two of them. Our park and trail referendum that was passed and the recent library referendum that was passed. And that has become a greater percentage of our debt levy so homeowners will bear...share of that debt that they would of the debt that has come off in the past few years that we' ve been paying. Councilman Ayotte: I would ask for a qualitative statement from primarily Mr. Gerhardt, or you could say it and you could translate it for me but I think one of the things that we're missing here is, an example. TIF deficit estimated at $3.4 million dollars. That could be a so what unless you conclude the fact that we were much worst off not too long ago. So can yon state primarily for the people who are watching, how we've been put in a positive posture and that situation could have been much worst? Who wants to grab that? Todd Gerhardt: I can try. Over the last 2 weeks Bruce and I have spent a lot of time looking at our debt service budget and also our general fund and one of the biggest things that we found was, there was some balances in different accounts and we were able to find those. I don't know if I'm going to do this justice Bruce. Why don't you give it a shot. Sorry. Bruce has worked with this and it's pretty complicated so. Bruce DeJong: Well it's not that we found balances. I don't want to lead you to believe that it just miraculously appeared. What's happened is that in our projections we've got two different types of TIF debt based on state statutes. There are some that's called qualified debt, which was issued prior to April 1st of 1990, and then there's non-qualified which is issued since. And we have been trying to maximize the amount that is considered qualified, but one of our schedules didn't have a proper breakdown of that so we were operating on some misinformation. We've since updated that and checked it with both our financial consultants and our auditors to verify that what we believe is there is accurate and they're in concurrence that we were kind of double counting some of the debt because our TIF district is made up of not only the TIF district fund 460, but it's also made up of about a dozen different debt service funds and so we were counting some of those in the TIF district deficit and some of them on their own as debt service funds which was kind of a double counting. I don't know if you're following that or not Bob. Councilman Ayotte: I'm going to re-state it. As a result of aggressive accounting procedures and from us aggressively attacking our debt situation, thinking that we were in a worst case than we were, we're now sitting pretty good. Bruce DeJong: I'd say that's an accurate statement, yes. We're in better shape than we thought we were just 2 weeks ago. City Council Special Meeting - September 15, 2003 Councilman Ayotte: And we're in better shape than we thought we were last year or previous. Bruce DeJong: Significantly better shape, yes. Councilman Ayotte: So it's a good news story, primarily because of the management techniques and the procedures that we brought into place to take a look at how we're servicing debt. Bruce DeJong: That's it to a large extent but there's also a significant impact on new state statute that was passed during the special session that allows us to extend our TIF district for one additional year. That brings in some significant extra dollars. Councilman Ayotte: Okay, thank you. Mayor Furlong: From a clarification standpoint too, since we're asking questions through your presentation, and if it's disjointed I apologize. But one of the things and maybe this gets back to the debt issue that was brought up here that one was a TIF deficit but too, back a few slides you also talked about the debt service levy projection with that chart there. If you can go back to that. There's not page numbers. Page 6 on our' s. That one right there. One of the things that's a component of the proposal that's being recommended here, just for clarification is that bar and what would be 2004, and Councilman Ayotte I think this speaks from a financial management standpoint, that bar in 2004 is after we transfer some funds, excess cash, excess funds that we have to offset really a spike in debt for 2004. Which again has been in place for a while, because if I'm looking at the schedules that we got, that bar really would be at 3.7 million, not the 2.2 without part of this plan is to transfer excess cash, is that correct? Bruce DeJong: That's correct. This plan includes a planned cash transfer which has been budgeted in 2003 and planned budget transfer for 2004 of $1,488,000 to reduce that spike. That spike was originally planned to be in there because that was the year that everyone supposed the tax increment district would come back on line and that we would have that in excess of a million dollars worth of tax generation available to mitigate it. So it wasn't a surprise but through the situation of being able to extend our TIF district it created quite a problem as far as the tax levy was concerned. Mayor Furlong: Okay, thank you. Bruce DeJong: I'll just conclude with the recommendation is to adopt the tax levy as shown on the sheet enclosed in your packet with the general fund tax levy of $6,657,060 and the remaining debt service levy is listed. Special assessment at $743,210, general obligation debt $147,000, park referendum $841,397 and library referendum $484,000. Mayor Furlong: Okay, thank you. We've interrupted with some questions. I'll bring it back for additional questions for staff at this time. Councilman Peterson: It's fair to assume what you meant to say up there was preliminary tax levy versus the tax levy, wasn't it? Bruce DeJong: Yes. This is a maximum tax levy and we cannot exceed this when we come to our hearing in December, but we can reduce the tax levy from this amount if that's what's recommended at that time. City Council Special Meeting - September 15, 2003 Mayor Furlong: Are there other questions for staff at this time? Councilman Lundquist: Question, and I guess it probably doesn't pertain to necessarily to the total levy but as I was looking through some old information the park and trail referendum that went out in '98, the brochures that went along with that talk about a 20 year bond payment, and as I'm looking at the schedules that we have, it looks to me like we've got that as an 11 year, expires the last payment in 2009. Was there a, it's old hat now but I guess just for my own edification, what's the reason we went from a 20 to an 11 on that one? Anybody know? Remember. I mean not that it matters. I mean it's old. It'd done, it's done. It's just as I was looking through the different, that's one that also spikes as well heavy this year and so that was just a question as I started digging more into why that spike would have been there. Todd Gerhardt: Are you saying as a part of the ballot, the question said 20 years or was it as a part of the marketing brochure? Councilman Lundquist: It was part of the brochures that the city sent out as a part of that. Todd Gerhardt: Did it say up to 209. Councilman Lundquist: Well the question is how long will I pay the extra tax and the answer is 20 years. After 20 years the bond will be fully paid and the tax will end. If you move you pass this obligation to the new owner. And again it's nothing we can do about it now but that's just a question that I had as I was looking at the different spikes in the debt service. But it may be a non-issue for us now anyway because it looks like we've got a pretty good plan. Todd Gerhardt: Yeah I don't remember. I mean the council at that time approved the bond sale and the structure of it. I can go back and dig out the minutes and see what was said. It may have been one where they reduced it to get a better interest rate. Councilman Lundquist: Yeah, I'm sure there was a reason. Just curious. Todd Gerhardt: I don't remember. Mayor Furlong: Thank you. Any other questions for staff? If not we'll bring it back to council for discussion and comments. I'll start at the front here. Councilman Labatt, do you want to go? Councihnan Labatt: Yeah. All the years up here I've always gone along with staff. They know this business better than I do and I'd just like to congratulate them for coming forward with a reasonable budget increase. Very reasonable one. The only questions I have or concerns were, as far as water treatment, what are we doing for planning for the future with a budget like this but maybe with what the state has done to us this year, this isn't the year to try to look at planning for the future and setting some money away for water treatment, but we need to look at that in the next couple years when we can rebound on that and start budgeting money and setting it aside to pay for that treatment facility, whatever it might be. My only comments. Mayor Furlong: Okay, thank you. Councilman Lundquist. Councilman Lundquist: I'm glad to see that the situation has improved in our favor. I know this is our maximum here and the valuation thing is still a concern but I think overall we've laid out the information and it gives us enough to make an informed decision at this point. City Council Special Meeting - September 15, 2003 Mayor Furlong: Okay, thank you. Councilman Ayotte. Councilman Ayotte: I think, along with what Councilman Labatt has stated and along with talking about before with water treatment. In addition to water treatment, I hope we've nailed down and solidified other efforts that have been going forward that address expense. Example, and we've talked about it before is the sewer assessment. I don't know if that's been resolved, but obviously that's not tied directly to the levy, but what we pay to the Met Council certainly is a cost to our residents so it's something that does influence what goes out of pocket. So I feel comfortable with this but I want to re-state what Councilman Labatt stated. Nail down the water treatment requirements so what we know what costs are going to be there and how we're going to deal with it, and number two, sewer assessment. We have to close that out. I don't know if it has, I know it was ongoing. Do you know Todd if that' s been resolved? Todd Gerhardt: Teresa has told me they have installed a couple of the meters along the interceptor line. This is for better record keeping on the number of gallons of sewage that flows down to Blue Lake, and to compare our records to Met Council's records. We have installed a couple of those and will be doing comparisons and bring a report back to the council on the differences that we're finding, if we find any. Councilman Ayotte: That's all I have. Mayor Furlong: Okay, thank you. Councilman Peterson. Councilman Peterson: I understand both of my fellow council people's perspectives on water treatment but I don't see this discussion tonight as being at all relative to that. We've got an enterprise fund that's got millions of dollars in it and we've talked about hook-up and usage charges paying for the rest of it so I think whether it's the budget or this levy, I think water treatment is exclusive of this discussion tonight and correct me if I'm wrong Todd. The relevance is zero if not very low. Todd Gerhardt: You're absolutely right Councilman Peterson. Through the discussions I've had with both Bob and Steve and the Mayor have been that their concerns are with the budget increase, with the potential utility rate increase and with the pending assessment against a property owner. It would be difficult to take all three on in one year so those were their concerns as they expressed them to me. Councihnan Ayotte: Point of clarification so I can add my 3 cents. I know it has no direct impact on what we're discussing with regard to the levy, but a dollar out of a resident's pocket is a dollar out of a resident's pocket, and all I'm saying is that as we go forward with this, which is a good news situation, I do not want to lose sight of the fact that this council still has some heavy lifting to make sure we pay attention and perform due diligence to the costs that might be hitting our residents. That's my only point. Councilman Peterson: Going back to the specific question on the levy, I think that this staff, and staff this is my third levy discussion now and I think clearly this is the most aggressive, from a citizen standpoint to their benefit and I think that we have done some very creative accounting and we have been benefited by some decisions from both the state and county that will reap benefits for years, hopefully. You look at our fund balances and our cash position and it's tremendous. I joked with the mayor earlier in the week, I said let's wait 2 more weeks and maybe we can get a couple more million dollars. But unfortunately today's the deadline so we can't do that any longer. That being said, I'm still reticent to approve anything more than a zero percent, City Council Special Meeting - September 15, 2003 or a zero dollar increase in our citizens. I think you look at our fund balances that are trending upwards and our cash flow is trending upwards, so I would, and again realizing this is a preliminary but I would prefer to keep the increase less than at 2.7 to be sure that the resident who is paying $1,000 in taxes last year or this year, will pay $1,000 next year. I don't, and the 2.7 doesn't allow that so I would probably say I would go less than that. And Bruce, I guess I'd have to ask you about what that would be. It's probably in that 1.75 to 2 percent range maybe? I don't know. Ballpark. Bruce DeJong: I looked at it kind of backwards from a dollar figure standpoint and it looked to me on a preliminary basis that it'd be about $130,000 less than the recommended levy so... Councilman Peterson: Okay, that would probably be where this councilman would sit tonight. I think that again, I really commend the information we've gotten over the last week. It's been a tremendous benefit in helping me, in giving me, in many ways I slept better the last week than I slept in 3 years, knowing that the trends are positive and that even further cements my desire to help the citizens maintain their current tax position so those are my thoughts. Mayor Furlong: Okay, thank you. Some general thoughts as well. The proposed changes in the levy, one of which includes an increase of the general levy up to the limit, the new levy limits, and that new levy limit as ! understand was put in place along with the special session earlier this year. In the past the city has been well under the levy limits to varying degrees, but still under and this proposal would put us at the limit. As I looked at the numbers, and I will follow my fellow council members in congratulating the staff for their efforts, not only in putting the numbers together but the detail that's in there to give us answers to our questions as we look through it. Clearly the increase, which I mentioned with my earlier question, is on the debt side and it was expected. While there might be, it was also expected that the downtown district would come off so that spike created a unique situation, but nonetheless it was one that we can manage, as Councilman Peterson indicated with our excess cash or excess fund balances. Given that about $300,000 of that increase is directly related to the referendum, and that's a permanent increase. After that, those bond issues, and to give people perspective, it's going from about 500 to 800 a year, which is roughly about 30 percent, so that's a pretty hefty increase. After that, that particular bond payments are due to increase 5 percent a year and again with the expectation, correct me if I'm wrong, that the downtown district would be back on the general tax rolls, and therefore covering some of that cost. Since that's not a one time increase, to me that, if we don't levy for that now we get into a situation of having to play catch up. I concur with Councilman Peterson that it appears at this point, if all assumptions hold true, that there will be funds available to mitigate that catch up. That being said, I also look at the operating fund and back in January this council took action and working with staff in a very collaborative manner, but nonetheless to recognize that we were likely to lose those state aid funds that we had received in the past and we reduced spending, increased some revenue accounts, but nonetheless adjusted the budget down to our adjusted budget now where we were operating all year long, assuming we wouldn't have those. To me that's positive because some cities didn't and June and July they were trying to take out a year's worth of state aid in a 6 month period and we didn't have that problem. That being said I understand there's uncertainty as to what might happen with levy limits going forward. I think it would be my preference, from a fiscal management standpoint, to do what we can and in conversations with the city manager and director of finance, my sense is it is possible and likely that we can keep the operating budget flat from year to year. From 2003 to 2004. Now there are ways to do that and this council may agree with some of them, may not agree with others but bottom line, I think that's a goal that we should have. Again keeping in mind that any money we spend out of the general fund, generally becomes fixed to the next year and it becomes more permanent in nature and for the reasons mentioned up here, we need to constantly look at all the 7 City Council Special Meeting - September 15, 2003 money that residents are paying for the services the city provides. That leads me to recognize that given the increase as proposed by staff of maximizing the general fund debt levy, I'd be comfortable doing that if that was money that was budgeted to be transferred back to the debt levy, but the general fund increase up to the levy limit, that increase of just over $190,000 would be effectively transferred back to the debt side, similar to some of the plan that' s been done in the past to offset the increase on the debt side. I cannot disagree with Councilman Peterson's desire to see the dollars that the residents tax dollars paid, if their home goes up an average, at the average rate of growth for inflationary growth, no change, no remodeling, no additions. House didn't change but your assessed value goes up 10 percent, I'd like to see them pay the same taxes year to year. Now whether we do that today in the preliminary or whether we end up there in December with the final, let's talk about that. But I think that is a goal that we need to do. Normally if there wasn't a shift in the relative values of residential to commercial, which Councilman Lundquist asked about earlier. If the rate of change was the same for both classes of property, staff's proposal would accomplish that goal. And so it's that effect of changes and the pendulum swinging in terms of market values that we're also dealing with here and let's talk about that and figure out what we can do. But otherwise this proposal, staff's recommendation which is to increase the total levy by only the real growth would keep taxes flat and by it's very nature lower the tax rate on residents property values. Just because your assessed value goes up, your property taxes would stay the same so the dollar you pay in taxes relative to assessed value would go down. So the tax rates would actually be going down, So I can't disagree with getting at the goal. Let's talk about whether we do it now. Whether we do it in December because them are some issues that we have to come up with on the general fund side. Again my goal is to see that flat from year to year. I think it can be done based upon my conversations and keeping in mind the other issues raised of where we are. Councilman Peterson: Is there anything creative Bruce that we can do, addressing my desire, our desire, whoever's desire who wants to join in, of keeping Joe Citizen's taxes the same? Okay, instead of raising it the 1.83 percent, is there any way that we can put the levy at 2.7, okay, and use fund balances to keep their tax rate down so that in the event that we do have another levy freeze, which I don't think we will, but so that we're not put in that comer. Again regardless of your thoughts on using fund balances, is that an option? I'm thinking through it's probably not but I can't, if we levy the 2.7 percent, do we have to tax the citizen that? Can we use that delta to pay down debt? Are you tracking with me? With the question. Bruce DeJong: Yeah, I think I'm understanding your question. I'm not sure how you'd be able to do that. Councilman Lundquist: It wouldn't be a levy then if you didn't actually levy that amount. Councilman Peterson: I don't know but it goes back to, is there some kind of quirky loophole that says we can still levy and transfer funds somehow to keep your tax rate flat. Keep your tax amount flat. Councilman Lundquist: What you're trying to do is keep us, attempt to keep us out of the levy limit dilemma yet still keep the average Joe Citizen tax bill the same next year to this year. Todd Gerhardt: I don't know how you'd do that. Councilman Ayotte: The other question is, are we going to be seeing, will we have more information so to keep, to go the max, the 2.7, gather more data with regard to other costs which will help us decide whether or not, and going back to your point. I feel stronger the way you City Council Special Meeting - September 15, 2003 think knowing that we may have a problem to the taxpayer in other areas. When we see other reports... Mayor Furlong: Is there an answer to Councilman Peterson's question or, I don't know if it was answered. Bruce DeJong: There is kind of in a backwards way. I'm not sure how to. Mayor Furlong: It' s a backwards question. Bruce DeJong: The question is, what debt levies do you transfer, this cash transfer towards and if you were to transfer money I guess towards those two referendums and reduce those levy amounts and increase some of the other assessment bond amounts, that it would change that relative mix a little bit. ! don't have a spread sheet automated that I could just plug a number in and see what that effect is so I couldn't tell you, and I guess I've had some discussions with the mayor about proper procedures for reducing tax levies, and that really requires an irrevocable transfer of cash in order to do that. And you can do that on a one time basis but by the same token those special assessment levies that were listed as improvement levies on the schedule that you have. Really the second half of the bottom half of the page, are the ones that are disappearing next year and they're really the ones that have caused us the problems so that's why I reduced those or shown that reduction, the cash transfer down there as opposed to up against those two referendums. But to my knowledge that' s really the only relative way to shift that. Councilman Peterson: But there's a possibility, yeah. It sounds logical. Bruce DeJong: Well, there isn't after today because I have to certify to the Department of Revenue. Councilman Peterson: The percentages as to what. Bruce DeJong: What dollars figures are going to what debt levies. Councilman Ayotte: Oh you have to address that today? Bruce DeJong: Yeah. Councilman Ayotte: I thought you just had to give the levy limit. Councilman Peterson: You have to give you ratio of debt to general levy today. Bruce DeJong: So when we're done. Mayor Furlong: So our flexibility is limited after today. Bruce DeJong: Yeah, when we're done I have to go back upstairs and I have to fill out Form. PT- 280 that the Department of Revenue wants to see that lists all of the debt that we're paying and what type it is. Mayor Furlong: And again, because this is a preliminary levy, that would be the maximum that we could levy for those components? City Council Special Meeting - September 15, 2003 Bruce DeJong: Correct. And I hesitant to totally cancel anything because there was a movement in the legislature this year that would have restricted us to levying only those things that we had levied in prior years. So you know, if we don't levy anything for the referendum debt, then we may be restricted from that next year and we're really only you know, two bad revenue forecasts away from the state legislature being put in the same position they were this year where they have to make significant reductions. Councilman Labatt: So is there a way Bruce, if we adopt the preliminary, what you're recommending but we take the latest discussion here, can we do that after we, and make those transfers and buy out's of the other referendum debt and use the fund balance to pay off, can we do that between tomorrow and December 1st then? Bruce DeJong: No, we have to make that change today if we're going to do that. And I guess, I don't know. Mayor Furlong: And I guess for clarification, which change has to be made today? Is that allocation of the debt between special assessment, general obligation and then the referendums? Bruce DeJong: Correct. Mayor Furlong: That allocation. But we're not limited to those amounts come December 1st, if that's what Councilman Labatt was asking. Is that? Bruce DeJong: No. I would say that when we set these debt levies, that we really are limiting ourselves as to what happens on December 1~t. Mayor Furlong: Both in terms of higher and lower or just higher? Bruce DeJong: In terms of raising any one of those individual levies higher, I mean you can't do it. Mayor Furlong: You can't reallocate among the debt. Bruce DeJong: You can't reallocate between debt service funds. Mayor Furlong: Okay. Bruce DeJong: Once you've set that, that's the maximum that you will levy for that debt service fund for the year. Mayor Furlong: Within each of those funds so if there was a change, you'd have to specify which change that would be. Bruce DeJong: Yes. We'd have to reduce that because the Department of Revenue sends a form out to the county that authorizes us to certify a maximum levy, and then the county compares what we send back to them against that form for the Department of Revenue and verifies that we have not exceeded any one of those individual levies. Councilman Ayotte: Could I ask a question? Mayor Furlong: Yes. 10 City Council Special Meeting - September 15, 2003 Councilman Ayotte: Since the residents have voted in the debt in terms of the referendums, is there a potential that we would be doing something out of bounds to attack those debts with other monies? Bruce DeJong: I wouldn't call it out of bounds. Councilman Peterson: It's all their money. Bruce DeJong: You'll experience the same relative shift if you don't do it this year, then next year. And you know, essentially we'll have spent most of our fund balances, anything that's a surplus, during the course of the next year in resolving our TIF debt. Councilman Ayotte: Because it would still go towards those. Bruce DeJong: So next year, if you reduce that this year, you'll still experience that shift next year where you know, residential properties will pick up the bigger share of the burden than the other ones will. Councilman Peterson: I think I know the answer to this question, I just want to clarify. When the State froze to the previous year's levy it was not to the preliminary, it was to the actual wasn't it? Bruce DeJong: Correct. Councilman Peterson: ! mean I'd like to be creative but it sounds like it's in the eleventh hour and we're running out of time. Mayor Furlong: Well we have til midnight and the legislature's good at covering the clocks in black but I don't think we need to, I hope we don't need to go to that. That point. I'm hearing the same thing Councilman Peterson in terms of limitation. What, excuse me for interrupting, what are your thoughts? Councilman Peterson: I really, my goal is, again and historically I have not voted for preliminary that I didn't expect the final levy to be so I'm challenged by that philosophy, which is mine. And that means that I'm more into that $100,000 increase range versus the 200 and, what was it? 235. I'm comfortable using fund balances to make that up. Particularly based upon our new numbers that really show the positive trending so. I don't know what percent that is but I'm comfortable with 100,000 but I'm, that would be me. Mayor Furlong: In terms of aggregate, just for clarification. An aggregate increase of 100,000. Councilman Peterson: Versus the 235. Mayor Furlong: And in terms of the location of that within the general fund. Councilman Peterson: That part' s irrelevant. It goes back to. Mayor Furlong: I think it's irrelevant in terms of the taxpayers. It's bundled taxes between the two. When we talk about debt and general, it' s bundled for them. Councilman Peterson: Yeah. 11 City Council Special Meeting - September 15, 2003 Mayor Furlong: And so then the effect would be, I raise the issue about seeking a zero growth in the operating budget, which is not, by the levy we determine the size of the pie and obviously how that's allocated within there. Any thoughts on that? Councilman Peterson: Well I absolutely agree with that and I think it'd be a challenge but I think we can certainly meet those challenge. We've had the state rise to the occasion and set the example and I' m certainly going to try to follow that example and work with staff to find the best solutions to keep the budget at zero so, I wholeheartedly agree with you with that but again, the two issues aren't necessarily tied together but my goal is to maintain taxes and get the debt service properly handled. I think for not a lot of money we can keep the dollar, the taxpayers in Chanhassen stable at a no dollar increase without delving into our fund balances, into the hundreds of thousands of dollars like we would have had to have done in years past. We don't have to do that now. We can take a very, very small percentage of our cash balances to make them whole. So I'm open to that. Councilman Lundquist: Clarification? Mayor Furlong: Sure, Councilman Lundquist. Councilman Lundquist: Bruce we set the preliminary levy tonight. You need a breakdown of general fund versus debt service, correct? And if that was a 100,000, whatever the zero tax dollar effect on the resident is, if we for simplistic purposes say that all is general fund levy, we still have the ability when we adopt the final to require that that general fund levy amount gets transferred wholly into debt service similar to what happened last year in December, correct? Bruce DeJong: Correct. If I'm understanding properly, I think what Councilmember Peterson is asking for, is a reduction, and I hope I'm saying this right. If you leave the general levy at the levy limit maximum but then see a reduction in the debt service levy of an additional $133,500, is that? Councilman Peterson: Yeah and I can go either way but that seems to be the most logical. Then you're paying down debt with fund balances. Councilman Lundquist: So we would have in effect $191,000 general fund levy and a reduction in the debt service levy? Bruce DeJong: A reduction of 91,525 in the debt service levy from last year's level. Councilman Lundquist: Correct. Okay, so that gets us to the state levy limit maximum. Gets us out of the woods there, yet still keeps our residents at a, if I paid $1,000 on my bill last year, it's going to be $1,000 next year. Todd Gerhardt: But Bruce won't that reduce our capabilities next year on the levy increase percentage for the debt service side then? Bruce DeJong: Well then you'll see a larger increase next year. Councilman Lundquist: You're going to get dinged either way if the legislature decides they're going to ding you, they're going to get you either on the general fund or the debt service, one way or the other probably. 12 City Council Special Meeting - September 15, 2003 Todd Gerhardt: Right, and that's my point. You should probably go to the max on both so you don't handcuff yourself next year by what actions the state may take. Mayor Furlong: Question on the various debt funds. Special assessment, general obligation, and then the two referendums. Park referendum and library referendum. But for the two referendums which are specifically tied to individual series, there are a variety of obligations contained within the special assessment and the general obligation funds, is that correct? Todd Gerhardt: Correct. Mayor Furlong: So some of the concerns that have been expressed about what debt will we be able to continue levying for, and obviously we're trying to guess at some restriction that we don't even know about at this point, but from a financial management standpoint try to protect ourselves. Is the fact that there are multiple bond issues within those special assessment, general obligation funds, help in terms of mitigating some of the concern that you had, because I think some of the ideas that were floated earlier this year at St. Paul related to new issues as opposed to existing issues that were already being paid. I guess my question is the fact that we have multiple issues within the special assessment, general obligation fund help mitigate some of your concerns if those are not funded as fully as the referendum and park referendums. Bruce DeJong: I'm not sure how to respond. I think we put forth a pretty serious effort at trying to mitigate the increase, and I'd like to see us have some more time to really delve into the issues and see what those effects are on an average homeowner when those Truth in Taxation statements come out and I'd recommend that the City Council adopt the preliminary levy where it's at. I'm not sure that I'm wholeheartedly in support of Councilmember Peterson's suggestion that we cut that down at this point. I would rather give it some time to make sure that the numbers are correct. That we do have the ability to make some further reductions in the general fund.., the numbers that you're suggesting and let this season for a while. See where we come out in December. Mayor Furlong: Okay. Councilman Labatt: So just, Bruce or Todd. If we adopt the staff recommendation but we go back and we take the time and go back to Craig' s comment of, not wanting to handcuff ourselves for next year. We adopt what you're recommending but we can go back and take Craig's input and we can come in and pay out 133,500 in fund balance to knock down that debt. Are we handcuffing ourselves by doing that? By setting the preliminary at such, as we are today, for next year? Even though we're going back on 12/1 and we're bringing in 133,500 to pay down. By doing that are we handcuffing ourselves on 12/17 Bruce DeJong: I feel that we're limiting our flexibility if we make further reduction out of that levy at this point. Todd Gerhardt: To ask the question another way, if we keep it as is right now, can we reduce say the park referendum bonds in December, November and see that reduction in an overall tax statement that comes out in 2004? Bruce DeJong: Yes. Councilman Peterson: By using debt. By the fund balances. 13 City Council Special Meeting - September 15, 2003 Todd Gerhardt: Fund balances. So staff is right now is that we're recommending that you go to the staff recommended increase and then over the next 2 months sit down with the council, get some input from our consultants to see where the state might be going this coming year and play with those numbers in November-December. Councilman Peterson: One last question. We're talking about 2005 potential issues, right with the levy limits. If they impose debt levy limits or general levy limits. I'm just looking at potential available cash. We've left a couple of them open, two of them predominantly are the Pauly/Pony/Pryzmus site, and the Red-E-Mix site. Let's assume that we do sell those. Can those funds be used for either the general levy or some general fund or debt service payments? Because those dollar amounts would quickly mitigate any shortfall in levy limit that the state would put on us. And I mean I'm only listing two of the ones that we didn't even put down in our potential positive cash flow balances. Todd Gerhardt: I'm sure that Bruce is going to tell you that, you know if you were to sell those properties, buy some one time purchases with those type of funds. Don't give up levy authority for those because that's going to get you into a situation where some counties are right now where they've used cash reserves to balance budgets and now it's put them in the position to try to levy that money back, plus growth, so it wouldn't be our recommendation to use that to reduce the levy but to make one time purchases. Bruce DeJong: That's correct. Todd and I have been pretty firm advocates of matching, you know continuing revenue sources with continuing operations and one time funding sources with one time expenditures. Councilman Peterson: But to my question it would address a one time levy limit freeze, if that did happen and did come to fruition, that we wouldn't have to take it out of fund balances. That would be an incremental revenue coming into the city that could compensate to some degree. You know we're getting a philosophical discussion now but. Todd Gerhardt: Been in the business for 17 years, I don't remember too many years where we didn't have levy limits. They say they'll go away but they will impose some type of limit on us I believe, now and into the future. Councilman Labatt: Motion? Mayor Furlong: Other thoughts. Comments. Thoughts. Councilman Ayotte: ...staff's hands. I like Craig's point of let's see if we can keep or mitigate an increase to the taxpayers but I think we ought to adopt what staff has recommended and see how we work towards a resolution from now fil the December 1, December 8 timeframe. Mayor Furlong: Councilman Lundquist. Councilman Lundquist: I'm tending to side right now more with keeping the total impact flat. I know it's kind of puts us up against a guessing game right now, where we're going to put that, but in light of the rest of the things that we've got coming on, potential for some utility increases and other things, hook-up charges to offset some of the water treatment things coming up, it just, I'm not prepared right now to say that we should be taxing our residents any more. Albeit the numbers are small on the page, but I think it's more just a philosophical, I'm just not r 14 City Council Special Meeting - September 15, 2003 ready to go there. I think we're not talking about a big bucket of dollars overall and given the cash positions we have and fund balances, that we should be able to offset that so we may have to take a stab at that number, best guess but that's where I'm leaning right now. Mayor Furlong: Okay. And I guess for my thought, I'm similar. I don't need to get into the same point where we, it's flat on a dollar for dollar basis. My hesitancy is we don't know what those dollars are. At the same time I concur with Councilman Peterson that we're not, we're talking real money but it's workable m.oney based upon the numbers we've seen and so that's where I want to be in December. The question is do we take that position now and really what are we, where's our hurt? Well we've got the benefit of 2005 and that district coming back on to mitigate if we get into a one time issue here. Now I think as long as the increase, and I'm going to re-state my position earlier, the debt, the trouble side here. I'm confident in staff' s ability to manage the operating budget and keep that flat, and so really what we're looking at is how much do we transfer out of excess cash to cover the one time spikes in debt until we work through the issue with the downtown district. So if we've got some clarification of the numbers of what that would be now at a preliminary basis to keep dollars flat, I'd be comfortable with that. And we had some numbers working around there so I guess the question is I'd like to clarify what we think, you said that you had made some estimates of what that effect would be on an increase instead of the 233, what would that increase be? Approximately. Bruce DeJong: Approximately $130,000 less. Mayor Furlong: So the total increase in levy would be $100,000 approximately. Bruce DeJong: Approximately. About $103,500. Todd Gerhardt: 133,500. Councilman Lundquist: 103,500. Bruce DeJong: Yeah, I don't have that figure in front of me but it looked like it would take $133,000 reduction in the tax levy in order to hold it to a zero on an individual homeowner. Councilman Peterson: That's assuming that the 2.7 percent really does hold firm as being the accurate number. Whether the county will come back in a month and say well it's actually 3 V2 you know. Bruce DeJong: That's assuming I haven't made any procedural errors in calculating this. Councilman Peterson: Well that goes without saying. Bruce DeJong: I'm glad you're confident. I'm not sure I'm as confident in my ability to make those numbers exactly right. What we run is the risk of not taxing the real growth of the city, and you know, you have new properties. They require additional services and each one of those adds miles of streets to maintain. There's additional users on the parks. There's cleaning services that go on and I think it's only fair to fully tax the growth of the city to make sure that we're able to maintain the level of service that we're providing. Councilman Lundquist: But couldn't you also argue that because of the devaluation in commercial, there's higher vacancies so there's less people using those streets and services and things like that as well? I mean doesn't that same argument hold? The reason that you're. 15 City Council Special Meeting - September 15, 2003 Bruce DeJong: Well it's not the people that we're servicing. It's the properties and the properties are still existing. Councilman Lundquist: Right, but if there's less people in those commercial properties, you're not, I mean you're not necessarily recouping the investment that you've had to install those services but certainly for upkeep and periodic maintenance. Todd Gerhardt: We still have to have the plow truck go by that building. We still have to clean the sewer lines by that empty building. We have a schedule that we have to stick to. It's, we have a system in place and we hope it's efficient. It gets back to the whole growth issue where you have empty lots sitting between developments and we're not collecting full taxes on and you're basically subsidizing those properties until they're fully developed. Because we're' maintaining that sewer line, that street. Fixing potholes on that street where they're not paying the full shares of being fully developed so. Councilman Lundquist: Fair enough. Todd Gerhardt: It's not real simple in trying to explain how the city works. I mean everything would have to come in at once and develop at once to have a perfect model, and that's not how cities develop so. It's something you have to feel comfortable with and what you can support. Mayor Furlong: Further discussion or is there a motion? Councilman Labatt: I would, let me just, 5 years up here and this is the smallest percentage we've ever had brought to us. 2.7 percent increase. From the get go. We're hearing staff saying you know, adopt what we're recommending. Give us 2 more months, 3 months to fine tune it. Let's give them that time. We're just setting the preliminary here. They can go no more than 2.7 percent. Our friends will still like us. Our neighbors will still talk to us. We can still walk in the Legion and people will say hey, how you doing. We don't have to worry about things like that. So I' 11 make a motion that we approve staff' s recommendation. Mayor Furlong: Is there a second? Councilman Ayotte: I'd like a friendly amendment, do I do that at this point? Mayor Furlong: No. We need a second and then we'll go through the amendment process. Is there a second? Councilman Ayotte: Second. Mayor Furlong: Motion's been made and seconded. Is there discussion? Discussion on the motion. Councilman Ayotte: I'm wondering if we can affix to the motion the target of trying to ensure that we keep the tax flat, while still having a 2.7 percent limit. In other words, looking at ways to deal with the $133,000. Councilman Labatt: Yes. Councilman Ayotte: I want to throw that as a friendly amendment. 16 City Council Special Meeting - September 15, 2003 Councilman Peterson: I don't think it needs to be done. Councilman Labatt: I think staff has a direction from our comments here of what we want 12/1 but what my motion is, get on with this. Councilman Ayotte: Then my second holds as is. Thank you. Mayor Furlong: Okay, thank you. Is there other discussion? If there's no other discussion we'll proceed with the vote without objection. Resolution #2003-80: Councilman Labatt moved, Councilman Ayotte seconded that the City Council adopt a tax levy of $6,657,060 for the General Fund and a levy of $2,215,607 for debt service. All voted in favor, except Mayor Furlong and Councilman Lundquist who opposed, and the motion carried with a vote of 3 to 2. Councilman Peterson: In response to that I would like to go on record by saying, I voted for that on the simple basis of the numbers are fluid enough where I believe that the goal and I think certainly Councilman Ayotte is supporting that as, probably all of our goal is to have the flat tax and whether it's a 2.7 percent that comes up, that is a flat tax, so be it. My goal is today that and working down from there so. Thank you. Mayor Furlong: Thank you. REQUEST FOR A CONDITIONAL USE PERMIT AND SITE PLAN FOR A GOLF COURSE LOCATED AT THE SOUTHEAST CORNER OF THE INTERSECTION OF GREAT PLAINS BOULEVARD AND PIONEER TRAIL, SMG, INC., CHANHASSEN SHORT COURSE. Public Present: Name Address Nancy & Ken Holmberg Robert Boecker Boyd Peterson Gaye Guyton Kevin Norby Ron Saatzer Sharon Gatto Don Halla 9885 Raspberry 610 West 96th Street 9860 Pioneer Circle 10083 Great Plains Boulevard 6452 City West Parkway, Eden Prairie 9450 Foxford Road 9631 Foxford Road 6601 Mohawk Trail Mayor Furlong: This is a continuation from our last meeting. There were some questions raised. Is there a staff report? Kate Aanenson: Yes, thank you. I'll be brief. This item was tabled for the staff to get some additional information regarding fiscal impact and a little bit more information on what was intended with a water study. I've given you a copy of the standards from the DNR. What triggers the well study is the fact that they'd be using over a million gallons of water per year, so that does have certain standards that the DNR would require. And I'm looking at this paper study that the staff is recommending would be about $3,000 but the fact of the matter is, is the DNR 17 City Council Special Meeting - September 15, 2003 permit process would require the same scoping level and that would be the fact as stated in the letter that they would have to submit, the applicant being they, would have to submit air photos and location of all existing domestic wells within a one mile radius, and all production wells within a mile and a half, so they have to do that study themselves so by us putting a condition duplicates that same process. Then to carry it further, if the council was looking at that, there would be another scoping level on top of that but I believe that the DNR permit should be adequacy, which is a requirement anyway, and it would be their jurisdiction so kind of keep us out of that and let them respond to that. The second request you had was to look at the, on the fiscal impact so the city manager and myself did work with Hoisington Koegler and their fiscal person to kind of get a summary, which we put in the report of what it could be today, which would be 4 units an acre, and ultimately when it would come in for development at low density, approximately 44 housing units and that would assume storm water ponding, right-of-way and that sort of thing. How many houses they could get, and then the golf course with a club house. And really that was just really for your edification. There wasn't any comment or recommendation on that. It was just to provide you with some additional information. So with that staff is recommending approval with the condition that they get the permits through the DNR. Mayor Furlong: Thank you. Any questions for staff? Councilman Ayotte: I've got one. Mayor Furlong: Councilman Ayotte. Councilman Ayotte: Okay, we get the staff report that gives the hydro, I've got to look at it again. Councilman Lundquist: Hydrogeologic. Councilman Ayotte: Thank you. $3,000 if existing well data existed. I called today, we find out the existing well data existed. I want to know why we couldn't get that information when we got the initial staff report, and I suspect that the DNR information that you provided today, this information could have been known earlier also, so why didn't we have that piece of information earlier? Todd Gerhardt: Councilman Ayotte, Mayor, City Council. This is our first go around in dealing with a well of this size in many years. This was an education for my staff, for the council. I think even for the applicant and the neighborhood, and it was a learning ground for everybody as we deal with this. Typically when you come in for a residential well, you go get the permit and you don't have to go through these but when you talk about a commercial well this size, there's a little more detail that goes along with it. Councilman Ayotte: I'll accept that, learning curve then. Alright. Todd Gerhardt: So it was more of a learning curve. Mayor Furlong: Thank you. Any other questions? For staff. If not we'll bring it back to council for discussion. Is there any discussion on the proposal? Councilman Peterson: Let's move it on. 18 City Council Special Meeting - September 15, 2003 Councilman Ayotte: I agree. Mayor Furlong: If there' s no discussion, is there a motion? Councilman Lundquist: I would move that we approve Conditional Use Permit 4/2003-4 for the construction of a golf course with club house as shown in plans dated August 25, 2003, with conditions 1 through 9. Mayor Furlong: Thank you. Is there a second? Councilman Peterson: Second. Mayor Furlong: Any discussion on the motion? Hearing none we'll proceed to the vote without objection. Councilman Lundquist moved, Councilman Peterson seconded to approve Conditional Use Permit #2003~4 for the construction of a golf course with club house as shown in plans dated August 25, 2003, with the following conditions: 1. Hours of operation shall be seasonal and limited to sunrise to sunset. 2. No outdoor speaker system shall be permitted (individual pager systems are permissible). No commercial kitchen shall be permitted in the club house. There shall be no cooking equipment permitted on the premises with the exception of a microwave oven, pizza/ toaster oven, etc. The intent of this condition is to put the golf course operator on notice. The proposed septic system design does not allow for any cooking grease to be disposed through the system which will cause the system to fail. Approval of the Conditional Use Permit is contingent upon approval of Site Plan Review #2003-7 SPR. Soil tests must be performed at least once a year. Results of all soil testing must be submitted to the City of Chanhassen. In addition, annual reports detailing all applications of fertilizer (including nutrient content for nitrogen, phosphorus and potassium; application rate in pounds per acre; date of application; and total quantity of fertilizer applied) must be submitted to the City of Chanhassen. No fertilizer containing phosphorus may be applied unless the soil test results demonstrate a deficiency in phosphorus. No grading, disturbance or dumping shall be permitted in areas designated as bluff or in bluff impact zones. Runoff from cart paths, fairways, greens or tee boxes on Hole 3 shall not be directed into bluff impact zones or bluff areas. On-site grading may not increase the rate or volume of runoff downstream from the site or onto adjacent properties. 8. The applicant shall enter into a conditional use permit with the City. 9. No exterior lighting shall be permitted with the exception of safety lighting. 19 City Council Special Meeting - September 15, 2003 All voted in favor, except Councilman Labatt who opposed, and the motion carried with a vote of 4 to 1. Mayor Furlong: Motion prevails. Is there any discussion or is there a motion on the site plan review? Councilman Lundquist: I would move that the City Council approve Site Plan Review 4/2003-7 for the construction of a club house a maintenance building for a golf course as shown on plans dated August 25, 2003, with conditions 1 through 15. Mayor Furlong: Is there a second? Councilman Peterson: Second. Mayor Furlong: Is there any discussion on the motion? Todd Gerhardt: Mayor, I would include that the modification to item 13 be noted on that. Councilman Lundquist: Yeah, with the new condition with the DNR appliation. Mayor Furlong: So the condition from our prior meeting has changed from requiring a hydrogeologic study of the golf course to a condition that the applicant shall comply with all DNR permit requirements. Councilman Lundquist: So let's say conditions 1 through 15 as in, as written in the September 12, 2003 staff report. Todd Gerhardt: Thank you. Mayor Furlong: Good clarification. Any other discussion? If there's no, we'll proceed to the vote. Councilman Lundquist moved, Councilman Peterson seconded to approve Site Plan Review #2003-7 SPR for the construction of a Club House and Maintenance Building for a golf course as shown on plans dated August 25, 2003, subject to the following conditions: 1. Approval of the Site Plan Review application is contingent upon approval of the Conditional Use Permit. All trees to be preserved must be protected by tree protection fencing. Fencing must be installed prior to grading. 3. No vegetation may be removed within the bluff impact zone. The applicant shall provide a pedestrian/bikeway connection to the City's trail system at the intersection of Great Plains Boulevard and Pioneer Trail. 5. Fire Department Conditions: ao Please contact the Building Official and Fire Marshal to discuss the sprinklering requirements for the club house and storage/maintenance building. 20 City Council Special Meeting - September 15, 2003 will require an easement from the appropriate property owner. All disturbed areas are required to be restored with seed and mulch within two weeks of grading completion. bo Add the following City of Chanhassen latest Detail Plate Numbers: 5201, 5203, 5207, 5300 and 3001. The applicant is responsible to obtain and comply with all regulatory agency permits. d. On the grading plan add a benchmark. The applicant must submit detailed architectural plans for the club house and maintenance building that meet the design ordinance requirement. The applicant shall enter into a Site Plan Agreement and provide financial guarantees to insure compliance with the project. 10. Only one (1) monument sign may be permitted on the site. The total sign area shall not exceed twenty-four (24) square feet of sign display area, nor be more than five (5) feet in height. 11. The applicant is responsible to obtain and comply with a MnDot and Carver County permit. 12. Per MnDot's review memo dated September 2, 2003, the need for a net along TH 101 will be evaluated upon completion of the golf course. If it is determined that a net is needed, then the applicant will be required to install it. 13. The applicant shall comply with all DNR Water Appropriation Permit requirements. (The DNR examines a copy of the well log and the test pumping results before they make decisions on DNR appropriation permits.) 14. Comply with all conditions of the Carver County review letter dated 8/29/03. 15. Comply with all conditions of MnDot review letter dated 8/26/03. All voted in favor, except Councilman Labatt who opposed, and the motion carried with a vote of 4 to 1. Mayor Furlong: Those being the items on our special meeting agenda, I'll ask if there's a motion to adjourn. Councilman Peterson moved, Councilman Lundquist seconded to adjourn the meeting. All voted in favor and the motion carried. The special City Council meeting was adjourned at 5:35 p.m. Submitted by Todd Gerhardt City Manager Prepared by Nann Opheim 22