CC WS 2019 06 10CHANHASSEN CITY COUNCIL
WORK SESSION
JUNE 10, 2019
Mayor Ryan called the work session to order at 5:00 p.m.
COUNCIL MEMBERS PRESENT: Mayor Ryan, Councilwoman Tjornhom, Councilman
McDonald, Councilman Campion, and Councilwoman Coleman
STAFF PRESENT: Todd Gerhardt, Chelsea Petersen, Kate Aanenson, Jason Wedel, Greg
Sticha, Todd Hoffman, and Jill Sinclair
BUY CHANHASSEN PURPLE PROJECT PRESENTATION.
Mayor Ryan welcomed Vernelle Clayton with Buy Chanhassen, Joel Rainville with Buy
Chanhassen and Michael Rainville with Meet Minneapolis. Vernelle Clayton provided
background information associated with the Citizen Action Request Form that was submitted to
the City Council regarding Buy Chanhassen in cooperation with Meet Minneapolis creating a
committee to explore the benefits to Chanhassen derived from visitors going to the Chanhassen
Dinner Theater, Paisley Park and Minnesota Landscape Arboretum. She introduced Joel
Rainville with Buy Chanhassen who introduced Michael Rainville with Meet Minneapolis. They
discussed how to market Chanhassen using digital marketing, website marketing, and other
resources that can be used to help publicize and promote hotels, motels, restaurants, and
entertainment attractions. Michael Rainville discussed an agreement for $30,000 per year that
will be submitted to the Buy Chanhassen group. Vernelle Clayton asked for a person from city
staff to help manage this program, outlined the revenue benefits derived from partnering with
Meet Minneapolis, the possibility of creating a visitor’s bureau for the City of Chanhassen and
how to initiate funding i.e. lodging tax. Councilman McDonald asked Vernelle Clayton how the
old Chanhassen Chamber of Commerce operated and a history of what happened to that
organization. She explained that the Chanhassen Chamber of Commerce was successful but
surrounding communities needed to market the southwest area of Minneapolis and created the
Southwest Chamber of Commerce. Councilman McDonald asked about charging the business
community rather than the City for Meet Minneapolis’s services. Mayor Ryan asked for
clarification of the fees being suggested by Meet Minneapolis to be used as a revenue source for
Buy Chanhassen. Todd Gerhardt explained how tax revenue would funneled through the city to
a visitor bureau. Mayor Ryan asked about feedback from local hotels regarding implementing
taxes, and what the process is for implementing a lodging tax. Vernelle Clayton suggested
coming back to the council with a representative from Waconia’s vacation bureau to provide
further information on their use of lodging taxes. Councilman Campion asked what services the
$30,000 fee from Meet Minneapolis would provide. After comments from council members it
was the consensus to proceed with discussions with hotels, Meet Minneapolis and Explore
Minnesota. Councilwoman Tjornhom explained that she could not support implementing a new
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tax. Mayor Ryan stated she needed more questions answered regarding increasing taxes and the
structure of Meet Minneapolis.
KEY FINANCIAL STRATEGY: PAVEMENT MANAGEMENT PROGRAM DEEP
DIVE.
Jason Wedel reviewed past information using the OCI numbers to rank projects and the
discussion of whether the City should use an average OCI of 70 or 60. He discussed associated
costs with each number and the cost per square foot for different levels of street maintenance, a
map showing different street rankings and associated costs, a graph showing street construction
from 1960 through the current year and projects that will need to be reconstructed into the future
showing a comparison between street reconstruction costs versus mill and overlay. Mayor Ryan
clarified that the city is not behind in miles of street projects versus funding to keep up with
future projects to maintain an average OCI of 70. Jason Wedel discussed funding options with
the 60 percent City portion funded out of the Revolving Street Assessment Fund tax levy and 40
percent assessed and associated shortfalls. He discussed additional funding source options which
include increasing assessments, increase the tax levy and/or implement a franchise fee. Greg
Sticha discussed the different funding source options presented to the City Council last year
versus what is being presented this year as possible funding scenarios using bonding to cover
annual assessments, the City acting as the bank for assessments, increasing the tax levy, and
implementing a franchise fee. Councilman McDonald asked about the funding source to pay the
debt. Greg Sticha explained the funding source would be assessments collected by the City.
Councilman Campion asked if staff had taken into account revenue from new growth. Jason
Wedel presented the proposed 10 year capital improvement program overlaid with projected
street projects. Greg Sticha stated staff was looking for direction on how to proceed with the
amount of roads allocated for street projects and how to fund those projects. Mayor Ryan
suggested council digest the information presented, ask questions over the next couple weeks and
discuss it at an upcoming work session. Councilman McDonald asked staff to research how to
address the problem with potholes.
Mayor Ryan recessed the work session at 7:00 p.m. The work session was reconvened at
9:10 p.m.
DISCUSS LIGHTING SYSTEM EFFICIENCY UPGRADE FOR PUBLIC WORKS,
LIBRARY AND CITY HALL.
Greg Sticha explained that rebates will likely disappear in the future so suggested if council
wanted to proceed with this process now would be the time. Jill Sinclair explained that the direct
wiring method is the preferred way to proceed. Greg Sticha discussed possible funding sources
to implement this proposal. Mayor Ryan asked about the process of Xcel Energy contacting city
staff to conduct an audit. Jill Sinclair explained that Xcel Energy had reached out to an
Environmental Commissioner who in turn reached out to city staff. Mayor Ryan asked for
clarification on how to proceed with getting a more detailed audit before putting the project out
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for bid. Councilman McDonald asked if it would be an unfair advantage to the contractor who
conducts the detailed audit. After discussion it was the consensus of council to proceed with
getting a detailed audit.
Jason Wedel addressed the issue of potholes in city streets. Councilman McDonald suggested
staff bring back a plan for addressing potholes at the next work session. Todd Gerhardt stated
staff will bring back a map that shows what’s been done and what needs to be done to get the job
completed sooner rather than later.
Mayor Ryan asked council members if they wanted to continue the pavement management
program discussion now or at a future work session. It was decided to bring the item back at the
next work session. Greg Sticha explained the timeline associated with implementing a franchise
fee. Todd Gerhardt explained the work associated with preparing a proposal for council to
review. Mayor Ryan directed staff to prepare information to bring back to council at their June
24th work session. Councilman Campion asked about ranking street projects after a funding
source has been chosen.
Mayor Ryan adjourned the work session at 9:30 p.m.
Submitted by Todd Gerhardt
City Manager
Prepared by Nann Opheim