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09-25-2023 City Council Work Session MinutesCHANHASSEN CITY COUNCIL WORK SESSION MINUTES SEPTEMBER 25, 2023 Mayor Ryan called the work session to order at 5:30 p.m. COUNCIL MEMBERS PRESENT: Mayor Ryan, Councilman McDonald, Councilwoman Schubert, Councilman von Oven, and Councilman Kimber. COUNCIL MEMBERS ABSENT: None. STAFF PRESENT: Laurie Hokkanen, City Manager; Matt Unmacht, Assistant City Manager; Eric Maass, Planning Director; Charlie Howley, Public Works Director/City Engineer; Rick Rice, IT Manager; Jerry Ruegemer, Park and Recreation Director; Ari Lyksett, Communications Manager; Kelly Grinnell, Finance Director; Samantha DiMaggio, Economic Development Manager; Rachel Arsenault, Associate Planner; and Kim Meuwissen, City Clerk. PUBLIC PRESENT: Dustin Phillips, Kraus-Anderson Dan Kjellberg, Kraus-Anderson Bryan Harjes, HKGi Paul Michell, BKV Group Scott Caron, Ballard King Kevin Clarke, HKGi 2024 PRELIMINARY BUDGET AND LEVY Finance Director Kelly Grinnell reviewed the background history of previous budget work session discussions. Updated revenues, expenditures, and fund balance of the preliminary 2024 General Fund Budget were presented. Mayor Ryan asked the council for their input on whether to approve setting a preliminary levy amount of 7.4% or lower. The council concurred that the preliminary levy should be set at 7.4%. CHANHASSEN CIVIC CAMPUS UPDATE Dustin Phillips of Kraus-Anderson presented the schematic design and budget development to date, reviewed the overall budget, reviewed estimate breakouts, discussed the value management exercise, reviewed a high-level budget summary, and discussed the next steps. The budget is currently $1.4 million above the initial budget. Factors that contributed to the increase were the stairs/elevator at the park building, the stage/porch at the park building, and an increase in city hall size by 1,000 square feet. The resulting question to the council was if they wanted to match the concept budget or expand the budget to accommodate project desires. Mayor Ryan asked the council for their initial thoughts on the increase to the budget. Councilman von Oven asked if the stage/porch at the park building wasn’t in the original concept. Mr. Phillips replied that it was not. Mayor Ryan added that the stage was a priority over the park building elements, and that the stairs and elevator needed to be part of the building due City Council Work Session Minutes – September 25, 2023 2 to costs. Bryan Harjes reviewed the elevator scenarios. Paul Michell discussed the right sizing of the heated sidewalk. Mayor Ryan asked about the addition of 1,000 square feet to the city hall building and where the changes were. Mr. Michell responded the 1,000 square feet were distributed throughout all the floors in the amount of approximately 300 square feet per floor. The parking level was discussed, including the number of stalls needed. Councilwoman Schubert asked about the playground costs. Councilman von Oven asked for clarification of the value management sheet. Councilman Kimber expressed concern about what should be sacrificed to lower the budget. Mayor Ryan agreed and needed additional information as far as options, along with some time to review and digest the tradeoffs. Councilman Kimber requested additional information on the costs of the changes. Mr. Michell discussed the building material options and that alternatives could be presented to reduce the budget. City Manager Laurie Hokkanen clarified that the council needs to decide whether it is more important to stay with the concept plan budget or if cuts should be made. Ms. Hokkanen responded that the levy would need to increase an additional half a percent in 2025 and a tenth of a percent in 2026 if the project costs are increased. Councilman Kimber asked if future levies could be smoothed to accommodate the increase. Ms. Grinnell responded that it could be done, but something else would need to be cut. Councilman von Oven observed that future levies would still be in the sevens and that people might not remember if the number was 7.3 or 7.8. He appreciated the term “value engineering” and that we should take a hard look at the entire scope of the project and determine what brings the city the most value. Mayor Ryan would like to continue the value engineering process by reviewing all the park features and their associated costs and understanding the value of each component. Councilman Kimber agreed. Councilman von Oven added that having that list of contingencies would be helpful. Councilman McDonald expressed concern that the exterior building materials of city hall shouldn’t be sacrificed for the sake of the entire civic campus. Ms. Hokkanen thanked the council for their feedback and direction and asked the council to confirm that the heated sidewalk element should remain a part of the project. Mayor Ryan responded that from the feedback she has received from senior citizens, it is a priority. Mr. Phillips reviewed the next steps to continue to analyze the design, estimates, and budget and meet again at the end of design development in December. Kraus-Anderson, BKV, and HKGi will work with staff on a bid package schedule at the start of design development. CITY COUNCIL ROUNDTABLE Mayor Ryan discussed commercial vehicle parking adjacent to residential areas, specifically regarding a complaint of a semi parked along Kerber Boulevard from a resident in an adjoining neighborhood. Public Works Director/City Engineer Charlie Howley responded that Kerber Boulevard is a Municipal State Aid (MSA) street and the requirements for the city to receive funding for an MSA route, the city may restrict truck parking on the street; however, trucks must be allowed to drive on the street. The council discussed the issue and agreed not to move forward with this item. Mayor Ryan will respond to the resident. Councilman McDonald brought up Sewer Availability Charges (SAC) and whether the city can assist businesses with these fees. Mayor Ryan agreed and has asked Ms. Hokkanen to direct the Building Official to review and evaluate SAC and WAC fees at the first of the year. The council concurred. City Council Work Session Minutes – September 25, 2023 3 Mayor Ryan recessed the work session at 6:55 p.m. Mayor Ryan reconvened the work session at 9:50 p.m. LOT COVER DISCUSSION Public Works Director/City Engineer Charlie Howley presented an update to the July 24, 2023, Work Session discussion on whether the maximum lot cover percentage should be increased from 25% in the Residential Single-Family (RSF) district. Mr. Howley reviewed the reasons behind the request and presented two options for the City Council to consider: Option 1: Raise allowable lot cover in all RSF-zoned areas from 25% to 30%; or Option 2: Raise allowable lot cover in all RSF-zoned areas from 25% to 30%, subject to conditions. Regardless of the option chosen, the implementation schedule would be the same, and the change would become effective January 1, 2024. Mr. Howley asked for the City Council’s input and direction. The City Council asked questions of staff and discussed both options, then recommended Option 2 with conditions to include a permit fee of $100 and require Best Management Practices (BMPs). LAKE ANN PARK PRESERVE UPDATE Park and Recreation Director Jerry Ruegemer introduced Mr. Kevin Clarke from HKGi, who presented a PowerPoint of the Lake Ann Park Preserve Implementation Project. The project update included the background, design, cost estimates, and next steps. The current project objectives include advancing the design to the 60% level, fitting the project to complex regulatory and construction requirements, determining the extent of the 2024 project based on budget/timing feasibility, developing construction documents, permitting, bidding the project in the fall/winter to begin work in the winter, and completing the priority project in 2024. Mr. Clarke also reviewed project tasks and schedule, including available grants. The current focus is on prioritizing the boardwalk engineering and trail/parking design for 2024 construction. Future enhancements that will likely occur in 2025 include signage and wayfinding, interpretation, natural resources, and natural surface trails. Mr. Clarke next reviewed project tasks, cost estimates, and Phase 1 determination, which includes three priorities: 1) boardwalks, 2) trail and parking lot paving, and 3) trail reconstruction to the north. Funding sources and uses were identified, and the project task schedule was presented. Mr. Clarke asked the City Council if they had any questions and to provide clarifications and key priorities. City Manager Laurie Hokkanen stated that, historically, constructing the Lake Ann Park Preserve has been a key priority of the City Council and distributed a document showing possible funding options to finance the priorities in Phase 1 of the project. Mayor Ryan thanked Mr. Ruegemer and Mr. Clarke for the presentation, then asked the City Council for their input on the priorities for bidding on the project. The City Council discussed City Council Work Session Minutes – September 25, 2023 4 the project and concluded that Phase 1 of the project should move forward to include all three priorities. FUTURE WORK SESSION SCHEDULE October 9, 2023 • Chanhassen Civic Campus – City Council Update October 23, 2023 • November 13, 2023 • Presentation of Preliminary 2024 Utility Fund Budgets and 2024-2028 CIP • SAC Policy Discussion November 27, 2023 • Final Review of Proposed 2024 Levy, Budgets, and CIP for all funds December 11, 2023 • City Council Roundtable The work session adjourned at 10:55 p.m. Submitted by Laurie Hokkanen City Manager Prepared by Kim Meuwissen City Clerk