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CC 2005 10 24 CHANHASSEN CITY COUNCIL REGULAR MEETING OCTOBER 24, 2005 Mayor Furlong called the meeting to order at 7:05 p.m.. The meeting was opened with the Pledge to the Flag. COUNCIL MEMBERS PRESENT: Mayor Furlong, Councilman Labatt, Councilwoman Tjornhom, Councilman Peterson and Councilman Lundquist STAFF PRESENT: Todd Gerhardt, Justin Miller, Roger Knutson, Kate Aanenson, Todd Hoffman and Greg Sticha PUBLIC PRESENT FOR ALL ITEMS: David Jansen Chanhassen Villager Debbie Lloyd 7302 Laredo Drive Caley Stalecker Chaska Student Stephanie Souvannakane Chaska Student Lauren McKee Chaska Student Nathan Lindberg Chaska Student Steve G. Chaska Student Hanna Schiller Chaska Student Brinn Pfeiffer Chaska Student Rachel M. Chaska Student PUBLIC ANNOUNCEMENTS: Mayor Furlong: Thank you and good evening. Welcome to everybody here this evening and those watching at home. We’re glad that you joined us. I’d like to start out at this point and ask if there are any modifications or additions to the agenda that was distributed with the council packet. If none, then without objection we’ll proceed with that agenda as distributed. First item tonight is I’d like to extend an invitation for our Halloween Party that the City is sponsoring in conjunction and cooperation with some of our local businesses in this community annually who sponsor various special events and the fall event is our Halloween Party which will be held this th coming Saturday, October 29 from 5:30 to 7:30 at the Chanhassen Rec Center. Children ages 2 to 12 are invited to participate in this special event and obviously their parents are welcome to come with them as well. The event will have entertainment and trick and treating, hayrides, weather permitting, games. It’s a lot of fun. Pre-registration is required so I would encourage th you to register your children by Friday, this coming Friday the 28. Either at City Hall or at the Chanhassen Rec Center. There’s a $4.00 fee. Adults are free. It’s a very fun event so I look forward to a good participation. CONSENT AGENDA: Councilman Peterson moved, Councilman Labatt seconded to approve the following consent agenda pursuant to the City Manager’s recommendation: City Council Meeting – October 24, 2005 a. Approval of Minutes: -City Council Work Session Minutes dated October 10, 2005 -City Council Verbatim & Summary Minutes dated October 10, 2005 Receive Commission Minutes: -Park and Recreation Commission Verbatim & Summary Minutes dated September 27, 2005 b. Approval of 2006 Police Contract with the Carver County Sheriff’s Department. Resolution#2005-89: c. Approve Plans & Specifications; Authorize Advertisement of Bids for Well Nos. 10 and 11, Project 04-08A. d. Accept $1,000 Donation from the Chanhassen Chamber of Commerce for Old Village Hall Plaza. Resolution#2005-90: e. Certification of Delinquent Utility Accounts. f. Accept $500 Donation from the Chanhassen American Legion Club Post 580 for Fire Prevention Week. All voted in favor and the motion carried unanimously with a vote of 5 to 0. VISITOR PRESENTATIONS: Bryan Litsey: Bryan Litsey, 650 Big Horn Drive in Chanhassen. I just wanted to address the sheriff’s contract and I know that last meeting it was on the consent agenda and it was removed. It’s my understanding now by approving the consent agenda tonight that you have approved the sheriff’s contract for 2005, is that correct? Mayor Furlong: Yes sir. Bryan Litsey: And there’ll be no further discussions about that this evening? Mayor Furlong: That’s correct. Bryan Litsey: Okay. One of my concerns, well let me first praise the sheriff’s department. I think they’ve done a wonderful job of stepping up traffic enforcement in Chanhassen. I think they’ve doing a very, very good job. I’m glad to see the increased presence. I see them out there on a regular basis. Me and my family and my neighbors really appreciate the good job that they’re doing so I want to thank the sheriff and the council actually for having the foresight to put on the traffic enforcement officer. One of the concerns I have though however relating to that issue is that last meeting Councilmember Brian Lundquist asked that that be taken off the consent agenda and one of the reasons he did for doing so is that he was concerned about the increased traffic enforcement that was occurring and mentioned that he had in fact received some, or heard from some residents who felt they were being picked on by that increased traffic 2 City Council Meeting – October 24, 2005 enforcement. And I’m concerned that his judgment on the council was affected by the fact, and correct me if I’m wrong but shortly before that meeting you received a speeding citation, is that correct? Councilman Lundquist: It has no bearing. Mayor Furlong: If you could address your questions to the council as a whole. Bryan Litsey: Okay, to the council. And I was, I was troubled by the fact that when you mentioned the fact that people were being picked on, that you didn’t equate that to yourself. If you have an issue with the sheriff’s department personally, I wish you would keep it on that level and not have staff and other people do additional work on your behalf. Mayor Furlong: Again Mr. Litsey if you could address your issue to the council… Bryan Litsey: …I’ll address it to the council. Mayor Furlong: Thank you. Bryan Litsey: I would appreciate it that if there are issues, that those be disclosed and so there’s an openness among the council when they’re discussing issues that have some personal impact on it and that they’re, and that you as a council not let your personal, in this case, contract with the sheriff’s department influence your judgment in terms of approving the contract. As far as I see it there was not reason that that contract shouldn’t have been approved and there was no reason to pull it off the consent agenda. Staff obviously recommended that it be put forth and then you asked for some additional, or the council asked for some additional information to come back to them and I don’t know why that isn’t on the agenda tonight in terms of what information the council is seeking in terms of the concerns that were raised when this was taken off the consent agenda, so Mr. Mayor, maybe you could address that. Mayor Furlong: Sure, I’d be happy to. The council did receive additional information this evening that was included in the packet which included the work plan for the coming year, so in addition to adopting the contract, there’s also the work plan. In other words, what are we going to get for our money was included in tonight’s packet and that’s what we’ve adopted this evening. Bryan Litsey: Okay, as a resident of the city I’d appreciate if you’re taking up matters and let’s, you have personal nature in them, either you reclude yourself from them or you disclose it at the time you’re making decisions based upon that, thank you. Mayor Furlong: Visitor presentations are still open if anybody else would like to raise an issue to the council. I’d invite you to come forward at this time. Very good, seeing none. We’ll move on. 3 City Council Meeting – October 24, 2005 LAW ENFORCEMENT/FIRE DEPARTMENT UPDATE. Chief Gregg Geske: Good evening. Couple things I’d like to go over. I did mention it in the council packet but we did have a successful open house. A lot of people and we put a lot of people, Mark Littfin will have some reports on the numbers of people that we had through our fire that week and such. I want to personally thank Mark Littfin and Ed Coppersmith for the job that they did during that week. A lot of work goes towards both the open house and the fire ed activities that we have. I was really impressed with the job that our rookies did for the open house. They, we presented them with a task of putting together a presentation of our turn out gear and different tools and stuff and they did a real good job of that so we’re pretty excited about the job the rookies are doing. I want to bring the fact, for my next presentation we’ll probably have ice out on the ponds and lakes and such. We do train and get our ice rescue equipment but I want to bring it to everybody’s attention that the ice is definitely unsafe as it starts to freeze and hopefully we won’t have any ice rescue calls so want to make sure everybody is careful and keep the kids off the ice. We will have fire trucks out on, at least one fire truck out on the evening of Halloween. We like to go around to different neighborhoods and such and hand out candy and that’s, we started that last year and it went over real well. Well received by the neighborhoods and kids and stuff and it gives us a chance to get out there and see the neighborhoods. We’ll be starting also some recruiting for members of our west end station. We’ve lost a couple members there. It’s our satellite station out on Minnewashta Parkway and we’ve got about 5 people left responding there so we’re going to try to pick up some additional fire fighters out in that end. Along with the cold weather coming, hopefully we don’t have any, there are other heating alternatives that we’ve seen advertised out there. Hopefully we don’t have problems. We do tend to have more problems with wood and other heating alternatives so hopefully we’re also going to be looking at that and making sure that we don’t have fires due to the fact that the heating fuels are being so high so. That’s about all I have to report. Any questions or concerns? Councilwoman Tjornhom: Mr. Mayor I think I have a comment…but I just want to say thank you. I was a chaperone at my…she’s in second grade at Chapel Hill and we went to the fire station for a field trip and what a good time everyone had. Very educational and entertaining and it was just a really, really nice day so thank you. Very good job. Chief Gregg Geske: You know that’s the great part, we do have, I think we had almost 30 people that took off work during the week to teach those classes and it’s a, you know it’s a great benefit for us. We get a lot out of it with the kids and such…kids of course and try to meet up with our kids classes but I think we get a lot out of it. It’s a great opportunity to see the kids at a happier time than we normally do so, anything else? Mayor Furlong: I think I’ll expand on that a little bit and that’s with regard to the open house. You mentioned that, there was great attendance. I think that everybody that I saw there was having a great time. Children and adults and everybody did a really great job and it’s, I’m glad that the department does that. It’s a nice way to reach out to citizens and make that personal connection so congratulations on the good event and look forward to attending more in the future. 4 City Council Meeting – October 24, 2005 Chief Gregg Geske: Thank you. Mayor Furlong: Good, thank you. Next presentations would be from the Carver County Sheriff’s Department. Sheriff Olson is here this evening. I don’t know if you had planned to make the presentation but since you’re here I’ll invite you to the podium. Sheriff Olson: Mayor and Council, I didn’t and I’m not here to report on that but I do want to just follow up. I appreciate the contract in your community. It’s my community as well and I appreciate the work that goes into it and the staff that works here for us in this community. I am very humbled by the fact that we in today’s modern society have options then to have to always look at our own policing. Our own efforts of doing the job for our public so I just want to take this minute just to thank you, the council, the staff. Justin has been at every sheriff’s contracting meeting that I’ve had or we’ve had together. He offers great input to all the process so I hope you do understand that we do respect the fact that we have this work plan in place and I appreciate the efforts of all of you to vote this in and try to share the policing with you in this community so I thank you for that. Mayor Furlong: Thank you, and we appreciate your efforts as well and those of the department. It’s a good relationship and we do appreciate all your efforts so thank you very much. Sheriff Olson: You bet. Todd Gerhardt: Mayor, just to update the rest of the City Council. Sergeant Olson had a family emergency. He was taken out of state so that’s why he’s not here this evening. Mayor Furlong: Thank you. AWARD OF BID FOR WATER REVENUE BONDS AND PARK REFUNDING BONDS. Greg Sticha: Mayor, members, council. Two weeks ago we brought before you a call for sale on revenue bonds and a call for sale on some park refunding bonds. Today was the day that the bonds went out for sale and with us this evening from Ehlers and Associates is Mark Ruff and Bruce DeJong to report on what actually took place today. Mark Ruff: Mr. Mayor, members of the council, I’m Mark Ruff with Ehlers and Associates. I’m just going to give a brief overview and then turn it over to Bruce. For those of you who have been on the council for a little while you understand that there’s a process that we follow in issuing bonds. We have to follow certain state statutory requirements, as well as certain requirements of the market. One of the things that we do is to prepare an official statement which is the disclosure document. You as the council should have received copies of that. The disclosure document talks about the facts and figures behind the city. Explains who are the larger taxpayer, who are the larger employers. How fast your tax base is growing. And then as summaries of your financial statements. We then take that official statement and send it nationwide to potential bidders and we also send it to a rating agency. The city utilizes Standard and Poors as their rating agency. The city has a very good bond rating. It is a AA-. To be in the AA category is not an easy thing for a city, especially a city that is growing as quickly as you 5 City Council Meeting – October 24, 2005 are. But Standard and Poors, after a conference call which included city staff. Greg was involved as well as Kate and Todd, were involved with the conference call with Standard and Poors in which we reviewed not only what’s happened in the city in the past but also how the city is planning for the future and I have to say from a rating agency perspective, what they have appreciated about the City of Chanhassen is the fact that you are looking forward and saying, through your capital improvement plan process. Through your multi year budgeting approach so you’re saying not only what’s going to happen in 2006 but hopefully we get a sense of what’s going to happen in 2009, 2011. So we did reach a confirmation of that rating, AA- and I just wanted to highlight a couple of things that the rating agency did highlight in their report to the investors, because remember the rating agency’s work on behalf of the bond holders. They don’t, they are truly a third party from the standpoint that they have nothing to gain by saying either good things or bad things about you. And I think the things that they highlight are a strong tax base growth with a mixture of both residential and commercial development. That’s very important to them. Above average income levels, as well as significant financial reserve levels bolstered by a brand of positive financial operations between fiscals 1996 and 2004. So again they’re looking back 8 years in terms of your history and they have seen consistency in your performance and I think you are to be applauded for that consistency. They like, they don’t like surprises. That’s one thing rating agencies just don’t like. And again because you have a high rating, then you have lower interest costs and with that I’ll ask Bruce to describe specifically what happened on the bond sale and what happened with the interest costs as well on both the refunding bonds and the water revenue bonds. Bruce DeJong: Good evening Mayor Furlong and members of the council. It’s a distinct pleasure to be back here tonight. Mayor Furlong: Welcome back. Councilman Peterson: Must be getting paid more. He’s got better suits. Bruce DeJong: Justin Miller’s handing out the results of the bond sale that we tabulated today and I will start it out with the $5,520,000 G.O. Water Revenue Bond, Series 2005B and just highlight some things here. This bond series had a lot of interest in it. It had 8 bidders, which is significantly above our average and they low bidder for this issue was Legg-Mason-Wood- Walker from Minneapolis and the true interest cost that they bid and that’s the calculation that we used that includes all of the issuance costs so that, and it includes the time value of money so that a dollar today is not worth the same as a dollar tomorrow. And that’s how we sell all of these issues on the true interest basis. Their cost was 3.8343, which is significantly lower than we had projected 2 weeks ago. I’m sure you’ve all seen the rising interest rates a while ago and we were expecting that to continue but it seems to have abated here. So I’ll just run through the Legg-Mason had your bonds insured by MBIA and that means that these bonds will carry a AAA rating for anyone who purchases them. Just run through the debt service. The principle amount, because of the lower interest rates that we received, actually was able to decrease by $55,000 so the actual amount of bonds that you’ll be issuing tonight is $5,465,000. A lot of that is, or actually most of that is related to the discount allowance which is the amount that we provide for whoever purchases the bond to sell them. That’s their earnings but in this case you received a premium bid which means the interest rates on that front end are a little bit higher, but it provides 6 City Council Meeting – October 24, 2005 more money on the back end for the sales so. The true interest cost is actually almost ¾ of a percent lower than what we had projected 2 weeks ago, and the coupon rates, you can see how they’ve adjusted. The interest cost actually saves you $332,575 over the life of the bond issue. So the recommendation is that you’ll award the bid to Legg-Mason and adopt a resolution providing for the issuance of sales of $5,465,000 of bonds. The second issue tonight is the general obligation park refunding bonds and this was a current refunding and we did this for two reasons. Number one, to restructure the amount of bond payments that you’ll be making in the course of the next couple of years to more closely match a flat levy schedule. And the second was because we believe there was some interest savings involved with these. These bonds were purchased by Piper Jaffrey and Company and it says Leewood, Missouri. I think that’s where their closing operation is but they’re trading desk that actually purchased them is here in Minneapolis. On these it’s a 4 year issue so significantly shorter than the other water revenue bonds, but true interest costs of 3.3274%. And this bond issue we actually had 5 bidders and you can see that the range again was very tight from 3.32 to 3.44% on the bids. And once again because the interest rates were lower we were able to reduce the bond size so this is $40,000 less than we had projected 2 weeks ago. The actual amount of bonds that you’ll be issuing is $2,590,000 and a lot of that is related to the change in discount also because this was a premium th bid issue. The net present value benefit, which we had projected on the 10 to be about $15,000, has gone up to over $49,000. So significant savings going from half a percent savings over the length of the bond issue up to 1.7% over the life of the bond issue. So the action recommended here is to award the bid to Piper Jaffrey and adopt a resolution for the $2,590,000 of G.O. park refunding bonds. Mayor Furlong: Very good, thank you. Are there any questions for staff or representatives from Ehlers? Councilman Peterson: Bruce, what are the primary factors in the difference between the 3.8 and the 3.3? Is it a combination of things? Of bond size. Type of bonds that they’re supplying. Bruce DeJong: The primary factor is the length that the bonds are going to be outstanding. In the case of the park refunding bonds, it’s only 4 years til 2010 and in the water revenue bonds it’s 15 years out to 2021. And so there’s a yield curve and typically investors demand more interest for taking the risk of holding those bonds for a longer period of time. Councilman Peterson: Okay, thank you. Mayor Furlong: Thank you. Any other questions? At this point. I think the results are certainly pleasing. It’s nice to see that our Standard and Poors ratings was reaffirmed. As I mentioned to Mr. Sticha today I’m sure you might have had some comments to our current Director of Finance if the council had screwed up that rating that you left us so appreciate that, but that is, that’s a good sign. It says that the plan, our Key Financial Strategies and the financial plans that we’ve been following these last few years are paying off and so it’s, and we’re seeing it tangibly in terms of the rates that we’re receiving here for, some of our financing so it’s good to see. Any other questions or comments? Okay, thank you. If not I’ll bring it back to the council for discussion on this matter. If there is any. If not, is there a motion to adopt the two. Mr. Gerhardt? 7 City Council Meeting – October 24, 2005 Todd Gerhardt: You could do both in one motion. So one would be award bid to Piper Jaffrey, adopt a resolution providing the issuance of sale of $2,590,000 in park refunding bonds. And then the other one would be to issue for water revenue bonds. Councilman Peterson: As said, so moved. Councilman Lundquist: Second. Mayor Furlong: Made and seconded. Any discussion? Hearing none we’ll proceed with the vote. Councilman Peterson moved, Councilman Lundquist seconded to approve Resolution #2005-91: awarding the bid for the water revenue bonds Series 2005B to Legg-Mason- Wood-Walker in the amount of $5,465,000 and Resolution#2005-92: to award the bid for the park refunding bond Series 2005A to Piper Jaffrey and Company in the amount of $2,590,000. All voted in favor and the motion carried unanimously with a vote of 5 to 0. PUBLIC HEARING: CLAWSON BUSINESS ENTERPRISES, INC. dba WINESTYLES, 600 MARKET STREET STATION, SUITE 140, REQUEST FOR AN OFF-SALE LIQUOR LICENSE. Public Present: Name Address Tara Clawson 18909 Explorer Trail, Eden Prairie Cindy MacDonald 4210 W. Old Shakopee Road, Bloomington Justin Miller: Thank you Mayor, council. The city has received a request for an off sale liquor license from Clawson Business Enterprises, doing business as Winestyles to open an off store liquor store. Off sale liquor store. Approximately 1,500 square feet in the new Market Square Station development. That development is zoned Central Business District and off sale liquor stores are allowed in that zoning. Law enforcement completed a background investigation on the principles of the organization and the owners and no negative comments were found. Public hearing notices were sent to property owners within 500 feet of the proposal and no comments have been received prior to the meeting. Staff would recommend that we hold the public hearing and then approve the off sale liquor license requested by Clawson Business Enterprises contingent upon receiving their liquor liability insurance certificate and license fee as well as acquiring the Certificate of Occupancy. Be glad to answer any questions. Mayor Furlong: Thank you. Any questions for staff? No. Seeing none, then I will open the public hearing at this time and invite all interested parties to come forward and comment on this matter. Certainly, please come forward. 8 City Council Meeting – October 24, 2005 Cindy MacDonald: Cindy MacDonald, 4210 West Old Shakopee Road in Bloomington representing Kraus-Anderson and Market Street Station. I would hope that this would go through. This tenant would be a welcomed addition to Market Street Station. Thank you. Mayor Furlong: Thank you. Anybody else wishing to speak at this public hearing? No one? If not, is there a motion to close public hearing? Councilman Labatt moved, Councilwoman Tjornhom seconded to close the public hearing. All voted in favor and the motion carried unanimously with a vote of 5 to 0. Mayor Furlong: We’ll bring it back to council then for discussion. Is there any discussion on the matter? No? If not, is there a motion to adopt staff’s recommendation? Councilman Lundquist: Motion to approve. Mayor Furlong: Is there a second? Councilwoman Tjornhom: Second. Mayor Furlong: Made and seconded. Any discussion on the motion? Hearing none we’ll proceed with the vote. Councilman Lundquist moved, Councilwoman Tjornhom seconded to approve the off sale liquor license request by Clawson Business Enterprises, Inc., dba WineStyles contingent upon receipt of the liquor liability insurance certificate and license fee. The license will not be issued until a certificate of occupancy has been issued for the space. All voted in favor and the motion carried unanimously with a vote of 5 to 0. PUBLIC HEARING: ASSESSMENT HEARING FOR TH 212/312 IMPROVEMENT PROJECT NOS. 03-09, 04-05, AND 04-06. Public Present: Name Address Paul Bilotta Chanhassen Sever Peterson Eden Prairie John Chadwick Bloomington Shannon Cooney Eden Prairie Jon Horn St. Paul Shawn Siders Town and Country Homes Kevin Clark Town and Country Homes Rick Dorsey 1551 Lyman Boulevard Larry D. Martin 2707 Spy Glass, Chaska Jeff Fox 5270 Howards Point Road Jim Paulsen 8629 So. Fairway, Victoria 9 City Council Meeting – October 24, 2005 Gayle & Lois Degler 1630 Lyman Boulevard Richard Palmter D.R. Horton Ron Mullenbach D.R. Horton Dan Herbst Pemtom Dan Cook Pemtom Gil & Margaret Laurent New Prague George St. Martin 9231 Audubon Road Paul Oehme: Thank you Mayor, City Council members. Just briefly, this has been a long process that staff and council has worked on. The improvements before you here tonight are all related to the 212 improvements. There’s a lot of infrastructure that the city is looking to construct along with the 212 project. Some of the steps that have happened along the way include the city approving a cooperative agreement with MnDot identifying costs for some of the improvements that will be discussed tonight. The city did in turn do a loan agreement with MnDot to help finance this project as well. And along the way the city staff has been meeting with the benefiting property owners along, in this area to help identify the improvements and work with them on the assessments and the improvements and the proposed improvements so at this time I’d like to invite Jon Horn with Kimley-Horn and Associates to give a brief presentation about the assessment methodology and the assessments in general. …his presentation you can ask if council has any questions and eventually open it for a public hearing. So at this time I’d ask Jon… Jon Horn: Good evening Mayor and council. As Mr. Oehme said my name is Jon Horn. I’m with Kimley-Horn and Associates. We’ve been working with city staff for quite a while in terms of the development of all the various improvements in the 2005 MUSA area. Wanted to specifically address the improvements that will be constructed as a part of the MnDot 312/212 project tonight. I’ll use some overheads here. This exhibit basically shows a number of improvements that we built as a part of the 212 project and I wanted to briefly walk you through those various improvements. This is the 212 corridor at this location. Lyman Boulevard along the north side. Pioneer Trail along the south side. Like I said I’ll just briefly walk through a number of improvements that are being constructed as a part of the MnDot project. There are turn lane improvements that are being constructed at this location and this location on Powers Boulevard, as well as at this location and this location on Pioneer Trail. Basically improvements that are being made to address pending development in the area, so those are roadway improvements that are being done. As a part of that there’s also a traffic signal that’s going in at the intersection of the ramps with 212 and Powers Boulevard. There are a number of public utilities that are going in there. Public watermain that’s going in along Powers Boulevard between Lyman and Pioneer Trail, as well as along Pioneer Trail from Powers Boulevard to the westerly city boundary. There’s sanitary sewer that’s being done in this area basically to provide for the needs of future development. Some improvements that are necessary to be built as a part of the roadway project basically just to get them in before the roadway’s built. There’s also a regional stormwater pond that’s being built at this location by MnDot and it is proposed that that regional storm water pond be enlarged to provide for the needs of development in this area. Moving a little further to the east, there are also a number of improvements that MnDot’s building as a part of the 212 project in the vicinity of Trunk Highway 101. This is existing 101, Lyman Boulevard at this location. This is the future 212 alignment. As a part of the MnDot job 10 City Council Meeting – October 24, 2005 they will be building turn lanes at this location to meet the needs of pending development at this location, which is basically just on the south side of 212, as well as turn lanes and traffic signal at this location for the future extension of Lake Susan Drive. There are also some utilities and turn lane improvements proposed at this location. As Paul mentioned, basically these improvements are all being constructed by MnDot. MnDot has provided city staff with estimated costs for all the various improvements. Total project cost for all the improvements I just provided you an overview with is a little over $2.6 million. A majority of those project costs are going to be funded through assessments to the benefiting properties. Basically an assessment methodology will be put together. The assessable amounts is a little under $1.7 million with the city picking up a little over $930,000. Basically the bonding for those assessments will be provided from the th State of Minnesota Loan Agreement that I believe the council approved back on April 11. Go back to the improvement exhibits will provide you with a brief overview in terms of how the assessments were determined for the area. Basically in cases where there’s roadway improvements, turn lane improvements that are being constructed to meet the needs of development, the costs for those turn lane improvements are being assessed 100% back to the benefiting property owners. In cases where there’s some shared benefit, like at the location of the future east/west collector roadway and Powers Boulevard, it is proposed that those costs be assessed to, 80% of those costs be assessed to the benefiting property owners with the city picking up the remaining 20% of those costs. In terms of the utility improvements with the watermain and the sanitary sewer, it’s proposed that the property owners be assessed for the equivalent 8 inch size which is basically the typical size that a developer would put in if he constructed the utilities himself. There are over sizing for both the sanitary sewer and watermain. It is proposed that the city pay for those over sizing costs as a part of the process. Then back to this exhibit, again in cases where there’s turn lane improvements to directly benefit the adjacent properties, those would be assessed 100% back to the property owners. It is proposed that the turn lanes and signals at future Lake Susan Drive be assessed 25% to the benefiting property owners with the city picking up the remaining 75% basically on a split of the legs of the intersection and then there’s sanitary sewer and water main. Again property owners would be assessed the 8 inch equivalent cost with the city picking up the over sizing cost. In terms of the assessment area, in cases where we’re assessing improvements on a benefiting area basis, and we spent a lot of time trying to identify what the benefiting area is, and I’ll just basically walk you through each of the benefiting areas. This is the area that would benefit from the roadway improvements. Basically all highlighted in yellow. These are all roadway, or all properties that would ultimately benefit from the future construction of east/west collector roadway. You’ll happen to notice there’s one parcel, Parcel 10 that does not show up on the assessable area. That parcel is in green acres and therefore cannot be assessed. In terms of storm water improvements, if you recall the proposed improvement exhibit, there’s a storm water pond at this location. Basically the properties shown here in green would benefit from that, and it is proposed the parcel area shown on here in green would be assessed for the improvements. Water main improvements, the area shown in blue would be assessed for water main. Basically provides a benefit to the 2005 MUSA area as well as some area outside of 2005. This is actually in the 2010 MUSA area. We are showing some costs going against the parcel that’s in green acres. The intention is that at the time that that parcel develops, they would pay for those assessment costs basically as a connection fee for the water main. And then for sanitary sewer, we are putting sanitary sewer in at this location. Parcels shown in brown on this exhibit are the properties that benefit and again those assessments are being determined on an area basis. Did 11 City Council Meeting – October 24, 2005 briefly want to talk about the assessment area calculations. Basically what we did is we took gross parcel area and we subtracted out 3 things. We removed roadway right-of-way or public roadway right-of-way. We removed wetland areas based upon the best available information, and we removed flood plain areas so it’s basically gross parcel area less right-of-way, less wetlands, less flood plains. And in terms of the assessments themselves, it is proposed that the assessments be on a 7 year term at a 6% interest rate. It is proposed that those property owners in the 2010 MUSA area, that their assessments would not be incurred at this time. They’d basically be deferred until January 2010 without interest because we basically are putting the improvements in before they’re necessary to coordinate with the MnDot improvements. And then property that’s in agricultural preserve in the 2005 MUSA area, as I mentioned, cannot be assessed at this time. There is no roadway assessments proposed for that parcel. Sewer and water charges would be connection charges in the future. So that’s kind of a summary of proposed improvements, cost, assessment methodology. Any questions? Mayor Furlong: Any questions for Mr. Horn? No? Okay, very good. Any additional comments from staff at this point Mr. Oehme are we ready to go forward with the public hearing? Paul Oehme: If there’s only questions from the council, we’re ready to open up the public. Mayor Furlong: Alright. At this point I will open the public hearing. We have two public hearings this evening so this first one I’d like to limit comments to the issues that were just presented by Mr. Horn. Those are the assessments relating to the improvements associated with the 312/212 project. Our next item on our agenda deals with additional proposed assessments relating to improvements in this same area, outside of the 312/212 project. So at this point I will open up the public hearing and invite interested parties to come forward and address the council on this matter. One thing that I will emphasize too, I believe this was included with the notice that was sent out, is that any property owner wishing to object to their assessment must file a written objection or waive the right to appeal prior to the closing of the public hearing so that’s the time frame we’re working under here. So at this point the public hearing is open and it’s, until it’s closed, that’s the time that property owners have a right to object to their assessments. So at this point I’ll open up the podium for the public hearing and invite again interested parties to come forward please. Larry Martin: Good evening Mayor, council members. My name is Larry Martin and I’m on here behalf tonight of Jeffrey and Terry Fox, Fox Properties Limited. LP. Gilbert and Margaret Laurent, and Art Johnson. Mayor and commission, council members. My comments will be essentially the same I think for both hearings so maybe later I’ll just say ditto. Before the hearing or before the evening started I did hand in a written form of objection to the 312/212 assessments to the city clerk and to the mayor for those particular parties so they should be in the record at this point. Each property has, the properties that I’m referencing each have their own issues. But there’s one major issue that is kind of a common thread for each one of them, and I really didn’t realize it until I was asked to study it by my clients over the weekend when we got the assessment package but there’s a timing issue, especially for the ones that are in the 2010 district. And Mr. Knutson will understand what I’m getting at and I didn’t get a solidly formulate the problem for myself until I was studying it. And it relates to a case that was decided this summer. It was a case that occurred up in the City of Minnetrista and it involved an 12 City Council Meeting – October 24, 2005 inverse condemnation taking where a property owner was assessed for some improvements several years ago, and some time passed and then the city changed the land use regulations that apply to that piece of property and then essentially the improvements were no longer usable. No longer provided any benefit to the property. The long and the short of it is, the issue was well, you know could a city do that? You know assess for some improvements one day and then some time down the road say, well you no longer can use it for development purposes. Or you must maintain a low density and not really capture the value of those improvements. And this may be shocking to you but the court decided that sure, you can, the city can do that. And so that presents a little bit of a quandary for some, well all of my clients to a certain level. In particular Mr. and Mrs. Laurent and Mr. Johnson. They’re in the later district, and the staff has said well, let’s defer the assessment til 2010 when that area opens up. Then the question is well, what if some sort of land use policy change happens in the meantime, but we’re still on the hook for the assessments at, you know when 2010 does come. And so that’s a technical glitch that I think we have to work out with staff. And the only way to work that out is through some sort of agreement process that can really only unfold through an assessment appeal. So that’s one issue with the Laurent’s and with, and Mr. Johnson. There’s also one thing I noted for Paul regarding the Laurent parcel and there’s really no reason staff would have known this until I brought it to their attention. In, this summer, for the 312 project there was some takings that occurred and over Gil and Margaret’s parcel, or the parcel that they represent as trustees. Part of the area that’s assessed was actually taken for the 312 project. There was a taking a while back but there was another acre or so that was taken, and I’ve got to go through that with staff to determine whether or not that still should reasonably be included within the assessment district. There’s a technical issue that’s more physical in nature that’s more engineering, planning zoning kind of thing on Art Johnson’s property in the sense that it’s not clear to him how he would get access to his property in the future and so I said well you’ve got to go talk to the County. That would be a county road, to figure out how that’s going to work and make sure, get some assurances from staff, from a planning perspective how that will shake out in 2010 and then you can talk about those assessments. And so those are the issues for those parcels. Similarly this is a timing issue on the Fox Properties parcels, and this relates to the Bluff Creek Overlay District, and the issue is well, there’s a certain sector of the properties there that is protected by restriction. It, I think it’s the city policy and staff’s intent to work with us on working out the density issues for that land area that’s going to be assessed, but it’s likely that we won’t actually be able to develop that land. There’s going to be some sort of density transfer that will occur. Well, we haven’t worked that out yet. And so without really knowing you know what the policy is of the City, of the vision for that particular property, it’s hard to agree to that great a chunk of land to be assessed and so our position is we probably should hold that open until that issue is, you know until we’ve got a plan in here that’s reviewed and acceptable and there’s actually some observable benefit that comes from that plan review. I think that’s a fair summary of the significant issues with each one of those properties that we’ve filed an appeal on. The, I think it is likely I’ll just come back and say ditto on the next public hearing. However, with respect to Art Johnson and Gil and Margaret Laurent, they’re included in the assessment roll I think in the next public hearing, but there’s actually zero’s there so I don’t think staff’s intention was to present an assessment on those hearings. It was just probably for you to analyze and see that they’re in that general area but not being assessed. So I filed a, it was kind of a belt and suspenders kind of thing. I filed an appeal anyway but it doesn’t look like there’s an assessment. Thank you Mayor and council members. If you have questions, I’d be happy to answer them. 13 City Council Meeting – October 24, 2005 Mayor Furlong: Thank you. Any questions for Mr. Martin? Very good, thank you. Anyone else who would like to come forward at this time? Rick Dorsey: Mayor, council members. My name is Rick Dorsey, 1551 Lyman Boulevard. Just two quick things. Number one, just to correct something that’s been said. Our property is not in green acres. It’s in an ag preserve program, which has different criteria. And as such within that the property cannot be assessed nor can assessments currently be deferred by state statute and I’ll give you just notification to make sure that that’s clear. Secondly, I did not receive any notification of this hearing. I’m listed on the assessment roll and did not receive notification so I want that of record. And I’ll give you written appeal. Roger Knutson: Mayor, his property is not being assessed. Rick Dorsey: I just wanted to make the other points to make that very clear. Mayor Furlong: Public hearing is still open. Would anybody else like to address the council on this matter? If not, again if there are any objections they must be filed here prior to closing the public hearing so this would be the time, unless somebody else wants to, has anything else to say to the council. I will ask for a motion to close the public hearing. Is there anybody else that would wish to address the council on this matter? Seeing nobody raising a hand or making movement. Is there somebody back there? No? If not, is there a motion to close the public hearing on this matter? Councilman Peterson: So moved. Mayor Furlong: There’s a motion to close the public hearing. Is there a second? Councilman Lundquist: Second. Mayor Furlong: Made and seconded. Let’s discuss that. Any discussion on that motion? Hearing none we’ll proceed with the vote. Councilman Peterson moved, Councilman Lundquist seconded to close the public hearing. All voted in favor and the motion carried unanimously with a vote of 5 to 0. The public hearing was closed. Mayor Furlong: Next item on our agenda was the consideration of a resolution adopting the assessment roll. I guess at this point I would ask if it would be preferential to table that action until we can try to seek to overcome some of the objections or. Roger Knutson: Mayor, I think it’s the staff recommendation is that you postpone action on the 212/312 improvement assessments and hearing, the assessments for 2 weeks until your next council meeting. And if you maybe want to vote on that. Mayor Furlong: Okay. Is there any discussion on that? If not, is there a motion to table? 14 City Council Meeting – October 24, 2005 Councilman Lundquist: I would move that we table. Mayor Furlong: Thank you. Is there a second on that motion? Councilwoman Tjornhom: Second. Mayor Furlong: Made and seconded. Councilman Lundquist moved, Councilwoman Tjornhom seconded that the City Council table the assessment hearing for TH 212/312 Improvement Project numbers 03-09, 04-05, and 04-06. All voted in favor and the motion carried unanimously with a vote of 5 to 0. PUBLIC HEARING: 2005 MUSA IMPROVEMENTS, PHASE I, PROJECT 04-05: ASSESSMENT HEARING AND AWARD OF CONTRACT. Public Present: Name Address Paul Bilotta Chanhassen Sever Peterson Eden Prairie John Chadwick Bloomington Shannon Cooney Eden Prairie Jon Horn St. Paul Shawn Siders Town and Country Homes Kevin Clark Town and Country Homes Rick Dorsey 1551 Lyman Boulevard Larry D. Martin 2707 Spy Glass, Chaska Jeff Fox 5270 Howards Point Road Jim Paulsen 8629 So. Fairway, Victoria Gayle & Lois Degler 1630 Lyman Boulevard Richard Palmter D.R. Horton Ron Mullenbach D.R. Horton Dan Herbst Pemtom Dan Cook Pemtom Gil & Margaret Laurent New Prague George St. Martin 9231 Audubon Road Paul Oehme: Thank you Mayor and City Council members. I’d like to invite Jon Horn from Kimley-Horn and Associates to the podium again to give a brief presentation on these improvements. Again this, these improvements are associated just with the MUSA area. Not associated with the 212 improvements and this is more or less just the first phase of our vision of the improvements to take place in this area. 15 City Council Meeting – October 24, 2005 Mayor Furlong: Just for clarification, but it does say Phase I. This is a multi-phase project, is that correct? Paul Oehme: That’s correct, yeah, This is only the first phase. The second phase will potentially take place next year. Mayor Furlong: Okay, thank you. Mr. Horn. Jon Horn: Good evening again Mayor and council. Same process. I’ll run through the proposed improvements with you. Talk a little bit about costs as well as running through the assessment methodology. Very quickly, Mayor as you had mentioned there is basically two improvement projects that are going to be done as a part of the 2005 MUSA improvements. There’s a bid package 1 or Phase I, and a Phase II. This assessment hearing for clarification is only for the bid package 1 or Phase I improvements. Basically I’ll run through the proposed improvements. They’re included as a part of Phase I. Again to help orientate you, Lyman Boulevard at the top. Audubon Road at the far side of the paper. Basically the improvements include as a part of this Phase I project are the extension of sewer and water main from Lyman Boulevard down along Bluff Creek to the future location of the east/west collector roadway at this location, so it’s the extension of trunk water main and sanitary sewer to help meet the needs of future development in this area. The other improvements that’s included as a part of the project is the construction of a bridge at this location. Basically the reason we’re proposing to do a bid package 1 or Phase I is the timing. It’s more conducive to do this type of work adjacent to the creek at this time of the year when the creek’s, when the creek flow is low and we can work with some potentially frozen soil conditions so there’s really, that’s the primary reason for us proceeding with the Phase I project. Again the assessments tonight are not for Phase II but I thought I’d just throw this exhibit up on the overhead really quickly. This ultimately shows the long term plan for the area. The construction of a roadway through this area between Powers Boulevard and Audubon. We’re still working on the design issues on this and still working with the property owners on some issues. In terms of the project cost, total project cost for the improvements for Phase I are a little over $2 million. Just to reference it back to the preliminary design estimate that we last presented to the council for basically the same improvements, it’s a little over $2.2 million for the bids we received did come in under estimate. A majority of the project costs proposed to be funded through assessments to benefiting properties. I’ll basically walk you through the proposed funding sources. We’re looking at assessments, funds out of the city sewer and water utility as well as MSA funds or state aid funds to help pay for some of the roadway improvements. It shows the components of the financing plan, a little over $1.6 million in assessments. It also breaks down the funding plan based upon the preliminary estimates as you can see generally the numbers came in under what the preliminary estimates were. The only one that came in a little over was the sanitary sewer utility, sanitary sewer costs were a little bit more than we anticipated. But all the other costs were under. In terms of the assessment methodology that was used to determine the assessment amounts, the trunk water main is proposed to be assessed to properties on an area basis, again for the equivalent cost of an 8 inch main. The city would pick up any costs for the over sizing. The assessment area was determined based upon benefit. Very similar with the sanitary sewer improvements. Again properties assessed for the equivalent cost for the 8 inch main, the city pays for the over sizing and again assessed on an overall project area. And with the roadway bridge improvements, it’s proposed that the 16 City Council Meeting – October 24, 2005 properties be assessed 80% of the costs of those improvements, just because there is some widening of the roadway to accommodate a collector roadway, it is proposed that the city pay for 20% of these costs. As I mentioned for the last assessment hearing, we again used an area basis to determine the assessment amounts. We took total gross property area, less roadway right-of- way, less wetlands and less flood plain to determine the assessment areas. And really quickly, again the assessable areas, this is the roadway improvements. The area shown in yellow. Again the exception is Mr. Dorsey’s property, and I’ll get it right this time. It’s in agricultural preserve versus green acres which is why it’s not shown on here is the assessable area. The water main assessment area is again a similar area. The Dorsey property is included. Connection fees at a future time once the property is developed. And the sanitary sewer improvements shown, or sanitary sewer assessment area is shown in orange. Similar to the water main assessment area. Again just to mention on the assessment terms, similar to the last assessment hearing, it is proposed that the assessments be levied on a 7 year term at a 6% interest rate. Property owners would have the opportunity to basically pay off their assessments within 60 days. Otherwise it would be assessed over the 7 year period. Again any questions? Mayor Furlong: Any questions for Mr. Horn or staff at this time? If not then I’ll open up the public hearing on this matter. Again prior to the completion of the public hearing any property owner wishing to object to their assessment must file a written objection or they waive the right to appeal. So at this time I will open up the public hearing and ask interested parties to come forward and address the council on this matter. Mr. Martin. Larry Martin: Thank you Mayor, council members. Again I’ll just restate by incorporating by reference the comments I made in the earlier hearing and for the same clients. Thank you very much. Mayor Furlong: Okay. Rick Dorsey: Mayor, council members. Rick Dorsey, 1551 Lyman Boulevard. Again just to restate the property is in the ag preserve program and by state statute cannot be assessed at this time nor assessments deferred from this time to a future date. The same as the other first public hearing, I did not receive any notice of the hearing and my notice has been filed with you. Thank you. Mayor Furlong: Thank you. Roger Knutson: Mayor, and just like the last one, he’s not being assessed. Mayor Furlong: Thank you. Anyone else wishing to address the council on this matter? Kevin Clark: Good evening Mayor, council members. My name is Kevin Clark. I live at 3841 Red Cedar Point Drive. I’m here representing Town and Country Homes, a K.Hovnanian Company. We have a vested interest in 3 parcels covered by these assessments or a third of the entire assessment. Those parcels are Char Jeurissen, the Luigi Bernardi or Aurora Investments and the Bruce Jeurissen parcel. We’ve certainly been active over the last 3 years working with city staff planning a residential component for this AUAR area, and are now in the final stages of 17 City Council Meeting – October 24, 2005 th plan design, having received preliminary plat here on October 10, and thank you again. We are in favor of the city moving forward with this assessment process and awarding the first phase of the project. I know there are a variety of parcels working their way through this system over the last 3 plus years, starting with concept plan approval, feasibility study, AUAR. There’s been a lot of effort and even prior investment on the city’s part and certainly it’s hard to make that first turn and this would be one of those major junctures but I encourage the council to move forward with this. Thank you. Mayor Furlong: Thank you. Anyone else wishing to address the council. Please come forward. John Chadwick: Mayor, council, staff. My name is John Chadwick. I live at 11430 Zion Circle, Bloomington. Here representing the Peterson family. Peterson parcel, and something I said a couple years ago when I addressed here in the same capacity is, our family’s been in farming and we’ve had chances where utilities have come in early on and we didn’t know quite how it was going to turn out and I certainly empathize with all the families out here. That can be a scary deal when a whole bunch of bills show up and utilities start to show up, but it does work out and I would ask you to have patience and have courage in that. Second thing in that overall process, the staff has worked very, very hard and we’ve seen many, many different alternatives for roads and for this and for that and I certainly commend them as being an inclusive process. I think the third thing is there’s a few things that are known and certainly some other things that maybe aren’t known or there’s still some questions that could go this way, could go that way, but some of the simple ones are, water runs down hill. You put your pipes at the lowest point. That’s a good thing. That’s the way God and nature laid it out so those things are pretty well aligned so that makes part of it a little easier. Winter is coming and you do need a bridge and that’s the time to put the bridge in, so those things are kind of easy. So to the extent that those things are pretty well solved, it makes some pretty good sense to move forward. What I do the rest of my time is I have an accounting background and interest rates are pretty low and so to move forward, you know I might fight your guys on a 6% interest spread over some bonds just awarded at 3 and something. You’ve got a nice spread going. Good gig if you can get it, so in any case. Also the big yellow army’s coming over the hill with the 212 project. Now is a perfect time to proceed forward with this and I would speak in favor of it and wish you all well on this process. It’s very exciting. A signature, a development for your community. Thank you. Mayor Furlong: Thank you. Sever Peterson: Mr. Mayor, council members. My name is Sever Peterson and I have some property at 1600 Pioneer Trail here in Chanhassen. I reside at 15900 Flying Cloud Drive in Eden Prairie where our home farm is and I’d like to just say tonight that through this process, as John and other landowners have expressed, it’s a scary process but I appreciate the way staff has worked with us through this and kept us informed and in a very positive way in my opinion and it’s worked out. I’m not sure that all of the fright is gone but it’s a new thing and it’s something that the landowners, at least myself are not, you know are not familiar with but I am eager to proceed and I wanted to share that with you tonight and I appreciate staff and I’m eager to proceed. Thank you. 18 City Council Meeting – October 24, 2005 Mayor Furlong: Thank you. Public hearing is still open for anyone else who would wish to address the council on this matter. Again prior to the completion of the public hearing any property owner wishing to appeal to their assessment must file a written, must sign a written objection or waive their right to appeal so if there is nobody else to come forward, we will be entertaining a motion to close the public hearing. So at this time I’ll ask again if anybody else would like to come forward and address the council on this matter. Seeing no one, is there, I’ll ask council if there’s a motion to close the public hearing. Councilman Peterson moved, Councilman Lundquist seconded to close the public hearing. All voted in favor and the motion carried unanimously with a vote of 5 to 0. The public hearing was closed. Todd Gerhardt: Mayor, City Council members. If we could have another motion to table the approval of the assessments to allow staff 2 weeks to review the appeals and bring back a recommendation. Mayor Furlong: Thank you. Would it also be appropriate to capture the next item as well, item 6(b) which is the awarding of contract? Todd Gerhardt: Yes. Mayor Furlong: Can we do that in a single motion? Is that okay? Todd Gerhardt: That’d be fine. Mayor Furlong: Okay. Is there a motion to table the remaining items of 6(a) and 6(b)? Councilman Lundquist: Motion to table 6(a) and 6(b). Mayor Furlong: Thank you. Is there a second? Councilman Labatt: Second. Mayor Furlong: Made and seconded. Councilman Lundquist moved, Councilman Labatt seconded that the City Council table the assessment hearing and award of contract for the 2005 MUSA improvements, Phase I, Project 04-05. All voted in favor and the motion carried unanimously with a vote of 5 to 0. Mayor Furlong: Okay, thank you and I appreciate everybody’s comments and again I want to, on these issues as Mr. Chadwick and Mr. Peterson mentioned too, we recognize that this is significant change to our city and it’s one that I appreciate all the efforts that the property owners and staff have put in. They’ve put in many, many hours over the last years and we got a little more work to do it looks like but at the same time I do, on behalf of the council, thank everybody for what I believe eventually will be a wonderful part of our city and we’ll have some very nice developments down there so thank everybody for their continued involvement. That 19 City Council Meeting – October 24, 2005 completes the items of, well excuse me. That completes the public hearing items. We have no items listed for finished or new business. I know we have a number of students here this evening. I would suggest there is a sign in sheet that went around. You might want to document your existence here by catching that sign up sheet. I know Mr. Berg likes to see that. And you’re all welcome so at this point we’ll move on to council presentations. COUNCIL PRESENTATIONS: None. ADMINISTRATIVE PRESENTATIONS: Todd Gerhardt: I have nothing to add Mayor. Just that we will be convening after this meeting to go through a budget. Mayor Furlong: Thank you, and that was on a regularly scheduled work session. Todd Gerhardt: That’s correct. Mayor Furlong: Okay, any questions for Mr. Gerhardt? CORRESPONDENCE DISCUSSION. None. Councilman Lundquist moved, Councilwoman Tjornhom seconded to adjourn the meeting. All voted in favor and the motion carried. The City Council meeting was adjourned at 8:10 p.m.. Submitted by Todd Gerhardt City Manager Prepared by Nann Opheim 20