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052907 CC WS Min CITY OF SHOREWOOD CITY COUNCIL WORK SESSION TUESDAY, MAY 29, 2007 5755 COUNTRY CLUB ROAD COUNCIL CHAMBERS 7:30 P.M. or Immediately Following Regular City Council Meeting MINUTES 1. CONVENE CITY COUNCIL WORK SESSION Mayor Lizee called the meeting to order at 8:00 P.M. A. Roll Call Present. Mayor Lizee; Councilmembers Callies, Turgeon, Wellens, and Woodruff; Administrator Dawson; Associate Attorney Mayeron; Finance Director Burton; Planning Director Nielsen; Director of Public Works Brown; and Engineer Landini Absent: None B. Review Agenda Wellens moved, Woodruff seconded, Approving the Agenda as presented. Motion passed 5/0. 2. 5795 COUNTRY CLUB ROAD Administrator Dawson stated at Council's May 14,2007, meeting Council had authorized an agreement with Home Leasing & Management, Inc., for rental property management services for the City-owned house located at 5795 Country Club Road. At that meeting there had been discussion regarding adding restrictive terms to the firm's standard lease. Dawson then reviewed a summary of terms to be considered for addition to the firm's leased based on comments from councilmembers and the property manager. ~ Early termination - the City could provide a 90-day notice of early termination after six months of the lease had passed, and that the lessee would be given credit for the last month's rent. The market standard for a lease was one year. ~ No smoking. ~ Initial payments - prepayment of the first month's rent and a security deposit equal to one month's rent. The property manager did not recommend requiring the last month's rent to be paid up-front as it would limit marketability. ~ Carpet cleaning at the end of the lease - the lessee would be responsible to pay for professional carpet cleaning. ~ Water softener - the lessee would be responsible for operating the softener during tenancy. ~ Pets - the property owner preferred to market the property with the option that one small pet would be allowed, and he/she would not permit a pet if the potential lessee did not appear to be responsible. A larger security deposit would be required if there was to be a pet. CITY OF SHOREWOOD WORK SESSION MEETING May 29, 2007 Page 2 of7 Administrator Dawson stated the more terms there were in a lease the fewer potential lessees there would be. After discussion, there was Council consensus to modify Home Leasing & Management's standard lease to include the above terms. Administrator Dawson clarified that the property manager must have a legitimate reason to request to enter the house, and the manager had a list of items he/she would want to check on that would allow him/her to enter the house every few months. Associate Attorney Mayeron stated Attorney Keane had related that Ascending Praise Church had merged into Livingwaters Church; therefore there was an existing entity that could be pursued to recover some of the City's loses. If the City chose to pursue recovery of its losses, Mayeron related that it was Keane's recommendation to file suit in conciliation court naming both Ascending Praise Church and Livingwaters Church as the defendants. The maximum amount of damages that could be recovered in conciliation court would be $15,000. The cost to go to conciliation court would be less expensive. Mayor Lizee questioned if this topic could be continued to an executive session for discussion on June 11,2007. Administrator Dawson stated this item would be addressed at a June 11,2007, meeting. Attorney Mayeron excused himself form the meeting at 8:10 P.M. 3. DRAFT CAPITAL IMPROVEMENT PROGRAM Administrator Dawson stated Council had received a "very first" draft of the City's 2007 - 2011 Capital Improvement Program (CIP) for discussion purposes. The accompanying cover memo he had prepared provided an overview of capital improvement budgeting. A CIP was a snapshot of needs, a schedule of improvements, and a schedule of financing; it was intended to be reviewed and changed as conditions and priorities change. He commented it was not always possible to level out future capital expenditure spending, which was apparent in the draft CIP. He explained that Staff had attempted to optimize the schedule by using the Infrastructure Improvement Matrix which rated the various roadways; the Matrix helped in determining which projects could be combined to optimize benefits. The availability of funds for storm water management improvement projects would be the driving factor in determining what street reconstruction projects could be performed. Dawson noted the Local Roadway Fund and the Storm Water Fund lacked the funds to perform key infrastructure maintenance projects. Dawson stated a key assumption in the preparation of the CIP was the level of transfers that had been made in the last few years would continue to be done in the next few years. Dawson stated the City currently transferred $345,000 from the General Fund annually to the Local Roadway Fund; of that $160,000 was allocated per year for roadway seal coating and overlay improvements. If that level of funding were to continue, it would take a few decades just to reconstruct all of the roadways rated "3" in the pavement management assessment done in 2007. The proposed Amlee Road / Glen Road / Manitou Lane Road Reconstruction and Water Main Improvements Project would consume a significant portion of the Local Roadway Fund. The ability to accelerate roadway reconstruction would require significantly higher revenues than the City was currently receiving. CITY OF SHORE WOOD WORK SESSION MEETING May 29, 2007 Page 3 of7 The following possibilities for significantly increasing funding for roadway reconstruction were reviewed. ~ The City could issue bonds for roadway reconstruction without a referendum; the issuance of bonds would be limited to projects listed in the CIP, and a petition signed by a minimum of 5% of the registered voters could force the matter to referendum. ~ The City could levy assessments against the adjoining properties to reflect the benefit the properties would receive. ~ State Statutes do not give cities the authority to establish a street utility, although efforts had been made in the last several legislative sessions to grant that authority. Dawson stated that a revision related to the technology/office equipment fund portion of the CIP had been provided to reflect the financial software package which had inadvertently been omitted. In previous years that fund had been labeled as public facilities/office equipment; in this draft the public facilities fund was moved back to the General Fund at this time, and the public facilities/office equipment fund was relabeled to technology/office equipment. Dawson clarified that the purpose this evening was to work toward agreement on the project priorities and timetable for the next five years. The CIP depicted what the Staff thought were the highest priority and highest value projects for the next five years. Director Brown stated it had been past practice to fund various parts of a major road reconstruction out of the appropriate fund (i.e., water main installation, storm water improvements, roadway improvements, and sanitary sewer improvements would all be funded out of a different fund). The cost for roadway reconstruction had increased substantially over the last few years, which resulted in funds in the Local Roadway Fund being consumed at a higher rate than had been planned. Previous major storm water improvement projects (e.g., the mandatory storm water plan update, and the Mary Lake project) resulted in the Storm Water Fund being significantly under funded. Brown explained there was a new technology that could replace the current overlay method that he would like to see the City test, although there is not a great deal of history with regard to the use of that technology. The new technology costs approximately one-half of the cost of the current overlay method. The City of Minnetonka was currently using the new technology for one-inch overlays, and the City of Plymouth was trying it on some of its cul-de-sacs. An engineer with the City of Minnetonka related that he thought the new technology would have a life span of approximately eight years. There were currently three contractors that had been trained and certified to use the new technology. He suggested the City do a pilot with the new technology on Yellowstone Trail between Country Club Road and Lake Linden Drive; that roadway was high traffic and it still had some structural integrity. He would also like to test the technology on a low-traffic road. He commented that once a roadway had deteriorated to the degree that it had heaved or buckled, the new technology would not work. The City's roadways rated higher than 3 could be candidates for using the new technology on. He stated ifhe could work out the details with the contractor, he would bring the request for conducting a pilot project using the new technology to Council at its next meeting. There was ensuing discussion regarding the CIP. There was Council consensus to leave the following in the CIP as presented or to make the identified changes to it. CITY OF SHOREWOOD WORK SESSION MEETING May 29, 2007 Page 4 of7 ~ No further transfers would be made to the Land & Open Space Acquisition Fund, and its existing funds would be transferred to the Storm Water Management Fund. If funds were needed for land acquisitions it would be funded out of the General Fund. ~ The Municipal Water System projects would remain a presented. ~ The Parks projects would remain as presented. ~ The Public Facilities fund would be expanded to include one-half of the cost to refurbish City Hall in 2008 and the second half in 2009, based on the most recent cost of $2 million to do that project. There would also be a transfer in from the Technology/Equipment Fund (see below). ~ The Sanitary Sewer projects would remain as presented. ~ The current Technology/Office Equipment Fund balance would be reduced to $100,000, and the remainder would be transferred to the Public Facilities Fund. There would not be a $50,000 transfer into the Technology/Office Equipment Fund in 2008. ~ The Equipment Replacement Fund should be modified to minimize the peaks and valleys in funding, understanding that delaying the projected date for equipment replacement could result in the need to purchase a replacement which was not budgeted in a particular year. The following clarifications were made. ~ The Land and Open Space Acquisition fund had been established to offset the possible cost to process land that a property owner wanted to donate to the City or for conservation easements. ~ The list of roadway overlay projects would be submitted to Council in the near future. ~ The scheduling of some of the projects or groups of projects was related to having accumulated enough funds to pay for the cost ofthe project(s). ~ There was no MSA funded project scheduled until 2011. ~ The lift station rehabilitation projects for the lifts on Enchanted Island and Shady Island were scheduled in order to level out spending. ~ The $50,000 per year Infiltration & Inflow (1&1) reduction project was to conduct the investigation and to reduce the City's 1&1. ~ Council should identify what CIP projects would be done in 2008 so that information could be used in preparing the 2008 budgets. The General Fund budget would be prepared in the summer, and it included transfers into some of the funds for the projects being considered in the CIP. The Enterprise Funds budgets would be prepared in October and November. ~ The Parks capital projects identified for 2008 were projects the Park Commission thought were the highest priority. Parks projects identified further out in the five-year span had not been given as in-depth consideration. The Commission had been quite selective in identifying projects that would consume the $320,000 in the Park Fund. Park dedication fees had also been used to fund Parks projects in the past; but park dedication fees were diminishing. ~ For roadway projects which also included a water project component, the water project costs were funded from assessments. ~ The $53,000 shown in Public Facilities in 2007 was for window replacements and HV AC changes. The $140,000 in 2008 was for drainage and siding. ~ The funds for the Public Works addition project for a cost of $400,000 were budgeted as follows: $60,000 was budgeted in 2006 for an architectural study (which was not done); $170,000 was budgeted in 2007; and it was assumed the remaining $170,000 would be budgeted in 2008. The 2006 and 2007 funds were accumulating in the General Fund. The CITY OF SHOREWOOD WORK SESSION MEETING May 29, 2007 Page 5 of7 CIP reflects the full cost of $400,000 in 2008 as that is the year the project was expected to be completed. ~ The quality of truck maintenance had extended the dump-truck life-cycle from ten years to 15 - 20 years. ~ In 2003, a capital assessment policy was adopted, and that policy addressed the expected life-cycle of equipment, but not other assets (e.g. water towers). Depreciation sheets were maintained for equipment. Bonds had previously been used to fund water towers or other utilities. The decision regarding the funding of very costly items such as that was whether to depreciate the item and save money for its replacement or to finance the replacement through the issuance of bonds and pay for it over time. ~ There had been previous consensus by Council to not assess for roadway improvements. ~ There had been previous discussion by Council regarding assessing for storm water management improvements, but no decision had been made. That discussion would be continued in a future meeting. The following suggestions were made to enhance the ease of understanding of the CIP: ~ Re-order the projects by department list by either priority, date, or something meaningful. ~ Re-order the sources and uses of funds list for the equipment replacement fund. Additional noteworthy comments were as follows. ~ There was a suggestion that a reserve level should be determined for each fund. ~ A description should be provided for the proposed Public Works expansion project, and the priority of that project in relationship to other projects should be discussed. ~ A combined schedule to do all of the roadway and storm water management projects and estimated costs should be prepared for Council to review so it can understand what financial resources would be required to complete them, and to ensure the priorities are correct. ~ There should be a strong commitment to focusing on roadway improvement projects. ~ All priority projects, not just roadway improvement projects, must be considered when determining which top priority projects would be funded. ~ The Amlee Road / Glen Road / Manitou Lane Road Reconstruction and Water Main Improvements Project could be done in 2008 based on current assumptions for the Local Roadway Fund, but it would significantly impact what roadway reconstruction projects could be done in future years. ~ A technology inventory was available; that inventory would be provided to Council. A request was made for a projected technology replacement or purchase schedule, similar to the equipment replacement projections. 4. OTHER A Glen Road property owner questioned if the property owners along Glen Road would have any say in the Amlee Road, Glen Road, and Manitou Lane road reconstruction and water main improvements project for which a feasibility study had been done. She stated that it sounded the City had already decided to do the project as described in the feasibility report. Council clarified that was not the case. Wally Piroyan, 24845 Glen Road, stated he spoke with Engineer Landini the previous week regarding the feasibility study, and Landini had been very helpful. He then stated his concerns about the feasibility report and the potential project with regard to Glen Road. The draft feasibility report for that project did CITY OF SHOREWOOD WORK SESSION MEETING May 29, 2007 Page 6 of7 not address the impact on the environment, and the report's mention of a few trees was very arbitrary. A survey had not been done as part of the feasibility study to provide information regarding where the new street would be located; therefore, it would not be appropriate to draw any conclusion from the report. The report did not address utilities, or the impact of moving the telephone poles would have on the mature trees. The feasibility report did not address the decrease in property values that would result from the loss of mature trees; an arborist should be hired to evaluate the short-term and long-term impact from the loss of trees. He suggested residents should be provided with drawings depicting what Glen Road would look like after the project had been completed. He noted that Kate Netwal had previously submitted a petition signed by seven property owners at the west end of Glen Road and a resident on Harding Lane requesting that Glen Road west of Manitou Lane not be widened. He stated that in the eleven years he had been a property owner on Glen Road he had never heard any of the property owners request that Glen Road be widened or that City water be installed. Engineer Landini stated Mr. Piroyan's concerns would be addressed in a plan for the project. The feasibility study was to determine the viability of the project and broad cost estimates. Director Brown explained that the first step in any roadway reconstruction project was to conduct a feasibility study to determine the scope of the project (e.g., should watermain be installed), could the roadway be constructed, and could the project be funded with existing City funds. The feasibility report did not address the level of detail requested by Mr. Piroyan; that detail would be address if approval was given to move forward with the design of the project. Director Brown then eXplained if Council approved the preparation of plans for the project, then the next step would be for Council to review the design. A public hearing would then be held to take public comment on the project. The impact on the individual properties, the trees, and possible assessments would be reviewed. There was public comment that it seemed as if it would be difficult to stop the project once the design had been done. Mayor Lizee stated the City had conducted a survey of the property owners and informational meetings had been held. The project was in the initial discussion phase. Kate Netwal, 25165 Glen Road, questioned if there was a cost to the City for the feasibility study. She stated the residents agreed that property owners on Glen Road did need to have the drainage issues impacting their properties resolved. She questioned if it would be possible to evaluate the possibility of reducing the proposed width of Glen Road without doing a new feasibility study. Councilmember Callies clarified that the purpose of the work session was not to discuss the details of this project. Mayor Lizee suggested another neighborhood meeting be scheduled to listen to the residents' concerns. She stated the feasibility report did not address details that had been mentioned. Nothing had been decided with regard to advancing the project. Mr. Piroyan expressed concern that he thought the project had moved to this level "under the radar". Mayor Lizee stated that nothing had been done "under the radar" and nothing had been decided with regard to the project. She again stated another neighborhood meeting could be scheduled and an information packet could be provided to the Glen Road property owners. She then stated property owners would be notified of the neighborhood meeting schedule well in advance of the meeting. CITY OF SHOREWOOD WORK SESSION MEETING May 29, 2007 Page 7 of7 5. ADJOURN Woodruff moved, Turgeon seconded, Adjourning the City Council Work Session Meeting of May 29,2007, at 9:46 P.M. Motion passed 5/0. RESPECTFULLY SUBMITTED, Christine Freeman, Recorder ATTEST: c~~~ ~ Christine Lizee, Mayor