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062507 CC WS Min CITY OF SHOREWOOD CITY COUNCIL WORK SESSION JUNE 25, 2007 5755 COUNTRY CLUB ROAD COUNCIL CHAMBERS 5:45 P.M. MINUTES 1. CONVENE CITY COUNCIL WORK SESSION Mayor Lizee called the meeting to order at 5:35 P.M. A. Roll Call Present. Mayor Lizee; Councilmembers Callies, Turgeon, Wellens, and Woodruff; Administrator Dawson; Finance Director Burton; Director of Public Works Brown; and Engineer Landini Absent: None B. Review Agenda Mayor Lizee requested Item 2.B, Park Commission Appointment, be added to the agenda. Woodruff moved, Wellens seconded, Approving the Agenda as Amended. Motion passed 5/0. 2. WILDLIFE MANAGEMENT Administrator Dawson stated in the fall of 2006 the City had received a written request from the Minnetonka Country Club to remove deer. After developing a deer management plan, the City received a special removal permit from the Minnesota Department of Natural Resources for removal of up to 20 deer from the Minnetonka Country Club property (to be done at the Country Club's expense). The Council also amended several sections of the Code to allow the discharge of weapons and dispatching of animals for wildlife management purposes by individuals approved by the SLMPD. Dawson then stated on February 27, 2007, Three Rivers Park District conducted a deer census within Shorewood at no charge. The survey, which was a snapshot of conditions on that day, counted 121 deer, with about two-thirds of that number around Christmas Lake. Dawson went on to state that during the discussions in 2006 Council indicated that in 2007 it would consider deer management across Shorewood. Earlier this year, Council stated it wanted wildlife management generally (not just deer) to be addressed. Dawson explained if the City wanted to do wildlife management outside of the Minnetonka Country Club another plan would have to be developed; if the request were for the Club only, last year's special removal permit would have to be renewed. Dawson also explained he conducted some internet research with regard to the Minnesota Bow Hunters Association (MBHA), but he found nothing on MBHA's website indicating they conducted deer removal. He stated he would check further to determine if he had researched the appropriate organization. Dawson stated there were residents who wanted to remove deer on or near their property. If that were to be considered Council would have to decide if it wanted to allow hunting within the City limits before that could be considered, and the City Ordinance would have to be amended accordingly. Council may CITY OF SHOREWOOD WORK SESSION MEETING June 25, 2007 Page 2 of 8 decide it was more appropriate to work within the boundaries of the City Code amendments made in 2006, and find an organization to do the removal. He related he had recently spoken with SLMPD Chief Litsey with regard to this topic, and Litsey again recommended the trap-and-dispatch be used for maximum public safety. Dawson commented if the wildlife removal were to be initiated by the City, it would be paid for out of the General Fund. The following noteworthy comments and concerns were stated. ~ Although the trap-and-dispatch method for deer removal was effective at the Minnetonka Country Club, other methods may be effective in locations with different topography. ~ The location of deer during the survey was somewhat surprising. Because the deer population traverses different areas within the City, it would be difficult to determine what specific areas should be addressed at any particular time. ~ The accuracy of the trap-and-dispatch method versus the bow-and-arrow method for deer removal was discussed. ~ There was not enough understanding of how a bow-and-arrow method would be done. Additional information on that approach and the trap-and-dispatch method should be provided, including what requirements and restrictions there would be (e.g. lot size). ~ The trap-and-dispatch method was done overnight; it seemed that the bow-and-arrow method of removal would be done during daylight hours. ~ There was no charge for the bow-and-arrow method. ~ Deer removal could be done during the deer hunting season, or outside the season under a special permit issued to the City. ~ Deer removal by residents could be construed as the City allowed hunting within the City limits. ~ Removal done by an association would be considered authorized hunting. ~ The City should be consistent with either charging for wildlife removal or not; that should not vary based on the type of wildlife. ~ The City could contract with one agency for the removal of deer, and residents could make a request for removal to the City and pay for the cost. ~ The deer removal effort could be contained to City properties only, including wetlands. Councilmember Callies stated she would prefer a controlled removal method for deer such as the one that was used for the Minnetonka Country Club. She thought the City should consider an amendment to the City's Ordinance that would restrict feeding of wildlife such as deer, geese, ducks, etc. Mayor Lizee stated she would prefer the method for deer removal would be sanctioned by the Chief Litsey, and that it be considered on a case-by-case basis. Individual residents would have to apply to the City. She expressed concern that allowing residents to remove deer during the hunting season could imply that the City allowed hunting within the City limits. Councilmember Wellens stated he would prefer the City use the bow-and-arrow method for deer removal; from his perspective that method could be used on any property. If the City went with that approach it could be changed in future years if it was not effective. Councilmember Turgeon stated the City should be consistent in its policy to charge or not charge for wildlife removal. She questioned how the City could prohibit the feeding of certain wildlife (e.g., deer, geese, ducks, etc.) and not restrict the feeding of other wildlife such as birds. CITY OF SHOREWOOD WORK SESSION MEETING June 25, 2007 Page 3 of 8 Councilmember Woodruff stated he would be reluctant to have the City spend $350 per deer for removal of more than a few deer. He also would support an amendment to the City's Ordinance to restrict feeding of wildlife. There was consensus that the City should publish an article in the Shore Report requesting the residents to cease their feeding of wildlife. There was also consensus to gather more information about the bow- and-arrow removal process and associations that would conduct the effort. Deer removal would continue to be considered on a complaint basis. Administrator Dawson explained the process for beaver removal. State statute allows a property owner to remove a beaver at any time. Any removal done by the City or by a contractor (hired by the City or a property owner) outside of the trapping season would require a DNR permit from the local conservation officer. The City's trapping/hunting ordinance would not allow property owners (or their contractors) to remove beavers without prior City authorization for managing the beaver population. Dawson then explained process for wild turkey removal. A State permit was required for removal of wild turkeys, and only governmental agencies may receive such a permit. Wild turkeys are destroyed (not relocated), and their meat must be given to food-shelf organizations. A few years ago, the City did obtain a special removal permit, but its Public Works Staff did not need to avail themselves of permission to exercise it. B. Park Commission Appointment Mayor Lizee stated that Park Commissioner John Moonen had submitted his resignation from the Park Commission as he was relocating. She stated the other two candidates Council interviewed on March 26, 2007, were still interested in the position. The candidates were Travis DeMers and Steve Quinlan. Councilmember Wellens stated he would prefer Mr. Quinlan because he was an engineer and he like the way engineers thought. Councilmember Turgeon stated he would prefer Mr. DeMers because of his sales, serVIce, communications, and marketing experience. Mayor Lizee commented that Mr. Quinlan had been Council's second choice at the March meeting. Councilmember Callies and Councilmember Woodruff agreed. Council member Callies stated she would make a motion at the upcoming Council regular meeting to appoint Mr. Quinlan. 3. LIQUOR OPERATIONS Don Swandby, Liquor Operations Manager, joined the meeting. Administrator Dawson stated Council gave direction to renegotiate the lease for the Waterford liquor store space at its May 14,2007, work session. He then stated that Mr. Swandby had been in discussions with the landlord regarding the lease. Dawson explained the landlord had submitted two proposals with regard to extending the lease. The proposals were as follows. CITY OF SHOREWOOD WORK SESSION MEETING June 25, 2007 Page 4 of8 In Proposal #1, the space could be occupied through October 31,2008. The current space would remain the same, and the current provision to downsize from 4,500 square feet to 2,850 square feet would be removed. The gross rent would be increased by 10 percent retroactive to April 1, 2007; therefore the annualized cost would be $73,990. This proposal would require a four-month notice for termination. In Proposal #2, the lease would run from April 1, 2007, through March 31, 2012. The space would be downsized to 2,850 square feet (as has been planned for several years), with a construction cost to the City of $1.00 per square foot in the rent. Gross rent would start at $64,890 for the first year and would increase three percent annually. Dawson stated having a lease of some duration in place adds value for the purchaser of a business. By assuming the lease, the new business owner would have some security in terms of planning for expenses and being able to stay in operation. Mr. Swandby agreed it would beneficial to have a lease in place for both stores if the City was going to put the businesses up for sale. The buyer would assume the City's lease at the time of purchase. A longer lease could be more attractive to a potential buyer. Swandby stated from his vantage point it would be better for the City to keep both stores in operation. The following noteworthy comments and concerns were stated. ~ If there were a willing buyer, it was possible to sell the City's liquor operations business even though the City did not own the physical buildings. ~ There was a liability to the City for entering into a five-year lease for the Waterford store. If the City could not sell the store and therefore closed the store, the City would be liable for the lease until the five years were up. ~ A buyer could renegotiate a shorter lease to suit its needs. It may have more negotiating leverage. ~ The two liquor stores were located in two of the three City's commercial zones. The third commercial zone was located around County Road 19. ~ There was a Liquor Committee meeting scheduled for July 30,2007, to review the year- to-date actual revenue and expense figures. ~ If Proposal #1 were agreed to, it would be very unlikely for the City would have any liability with having a lease for space with nothing in it. It would very likely it would take a minimum of four months to sell the store. The lease rate, which was less than the current rate, would remain in effect until October 31, 2008, when the lease for Shorewood Plaza store expired. ~ The revenue and expense figures through May 31, 2007, were on budget as revised. After ensuing discussion, there was consensus to continue the discussion of the future of the City's liquor operations and the Waterford store lease to an August 6, 2007, Council work session. Council would have the opportunity to review the year-to-date actual revenue and expense figures for liquor operations at that time. 4. CAPITAL IMPROVEMENT PROGRAM CITY OF SHOREWOOD WORK SESSION MEETING June 25, 2007 Page 5 of8 Administrator Dawson stated Council had its first discussion of the draft 2007 - 2011 CIP at its May 29, 2007, work session. The CIP had been updated to reflect the changes Council requested. He explained the updated CIP also included the following Staff revisions: 1) the Equipment Fund has been modified in 2007-2009 in order to replace the water truck in 2007 rather than 2009 and the dump truck in 2009 rather than 2007; and, 2) The Public Facilities Fund included $50,000 for two civil defense sirens in 2007. The need to replace the sirens has been known for some time, and has been shown in prior CIPs. The entire five-siren system among the four SLMPD cities needs to be replaced within a year. Administrator Dawson related that Council had asked for a schedule of the critical roadway improvement and stormwater improvements over a six-year timeframe to implement them, in order to get an idea of the cost implications to accomplish them. Staff prepared schedules for replacement of local roads rated "3" or worse by 2013. A schedule for stormwater improvements had also been prepared, showing drainage improvements associated with the local road improvements through 2013, and also showing priority improvements that are not associated with road projects. Administrator Dawson explained there was a correction to the CIP cover memo. The changes to stormwater management rates listed on page two should be changed to approximately $18 - $21 per quarter (the memo stated $12 - $14) or $72 - $84 per year (the memo stated $48 - $56). Those increases would be required to fund the list of stormwater management projects for through 2013. Director Brown explained the CIP reflected a change to purchase a water truck in 2007 rather than in 2009; and to purchase a dump truck 2009 rather than in 2007. He then explained City purchased its water truck in 1992; the truck was a used 1989 truck with 100,000 miles on it at that time. There were a number of problems with the truck such as its motor and transmission seals were leaking, and the water tank was leaking. The original projected service life of the truck had been fifteen years. Although the CIP reflected the purchase of a new truck, Staff believed the purchase of a quality used truck would be sufficient. Brown went on to explain that Staff had located a used water truck in Arizona that could satisfY the City's needs. That truck had 100,000 miles on it. The consideration of that water truck would require that he and Brad Mason fly to Arizona to check out the truck, and if it was satisfactory bring the truck back. Before purchasing the truck, Staff would take oil samples from the truck and have them tested; the test would reflect the condition of the engine. The company that owned the truck indicated that it would provide Staff with oil samples, it would be certified by the Department of Transportation, and the 2,500- gallon water tank was new. The truck was rigged very similar to the way Staff would specifY a truck if it was purchasing a new truck. Brown stated the cost for the used truck would be less than $45,000; the cost of a new truck was estimated to be approximately $140,000. Because the cost would be less than $50,000, it would not have to be put out for bids. Brown commented that the common service life for a dump truck was ten years in municipalities. There was a great deal of wear- and-tear on a dump truck which was used most days. Staff was comfortable with delaying the replacement of its dump truck until 2009. Brown stated it was quite expensive to paint the City's trucks "granny apple green". Many municipalities have decided to leave their trucks the standard white paint and to put their own logos and markings on the truck to ensure it was identifiable. There was Council consensus that Staff could go to check out the water truck in Arizona and purchase it if it were in good condition. With regard to local street reconstruction, Director Brown made the following clarifications. CITY OF SHOREWOOD WORK SESSION MEETING June 25, 2007 Page 6 of8 ~ The CIP reflected $66,000 for sealcoating each year. The past goal had been to sealcoat one-fifth of the City's roads each year. Because the cost of sealcoating materials had increased significantly, roads are now sealcoated approximately every 7 - 8 years. ~ The CIP reflected $95,000 per year for overlay improvements (overlay involved placing 1.5 - 2 inches of asphalt surface over the roadway). The City's average life of an overlay was approximately twelve years. Based on the $95,000 per year in funding, approximately one-fortieth of the roads (or approximately one mile of roadway) would be done each year. ~ The reconstruction of the eight roads listed in the CIP, was similar to the reconstruction that was done on Wedgewood Drive. Costs did not include the installation of water main. ~ The cost to install watermain would be assessed back to the property owners. Councilmember Wellens suggested money be transferred from the General Fund Reserves to fund additional sealcoating of roads. Director Brown suggested Staff could determine what additional sealcoating could be done based on an increase of funds. Councilmember Callies stated she would like to see funds be added to the Municipal Water System Fund, possibly a transfer from the reserves. She stated the Minnewashta Water Tower looked as if it were in as poor of shape as the SE Area Water Tower. She suggested funds should also be added to ensure watermain would be installed for the road reconstruction projects identified in the CIP. Director Brown stated past practice had been that the General Fund would not subsidize the Water Fund; the Water Fund supported itself as a business. The appropriate way to add funds to the Water Fund was to increase the water rates, increase the water connection charge, or change the City's policy. After ensuing discussion, there was consensus to use the $5,000 in 2007 budgeted for washing the SE Area Water Tower to wash the Minnewashta Water Tower. There was also consensus that the SE Area Water Tower would be refurbished in 2008. There was consensus to increase the funding for sealcoating and overlay projects. Mayor Lizee recessed the City Council Work Session to a Regular City Council meeting at 6:52 P.M. Mayor Lizee reconvened the Work Session at 8:32 P.M. 5. BUDGET CALENDAR - 2008 OPERATING BUDGET KICK-OFF Administrator Dawson asked if there were any specific programs or topics Council wanted addressed prior to budget discussions. Councilmember Woodruff requested Council be provided with a projected technology replacement or purchase schedule, similar to the equipment replacement projections. Councilmember Woodruff stated he anticipated a great deal more discussion on how the City proposed to spend money in 2008. He then stated based on the 2006 audit, the City was significantly over budget in revenues. He questioned if there were changes that could be made to how the revenue projections were arrived at to make it more accurate. With regard to expenses, he suggested a process be implemented to CITY OF SHOREWOOD WORK SESSION MEETING June 25, 2007 Page 7 of8 report on the status of projects that were budgeted for and to ensure those projects were completed. He stated if Staff recommended budgeting for a project, then it must have the confidence that the project could be completed (or at least started). Councilmember Wellens stated if the service life of equipment could be extended then Staff should ensure that it happened, rather than spend the funds as budgeted. Woodruff clarified his point was the reserves should not continue to be increased because projects were not completed. Councilmember Woodruff recommended that Council give Staff direction to prepare an Operating Budget (excluding capital projects) for 2008 that reflected no more than a 3% increase over 2007; 3% was approximately the rate of inflation. He commented that the spending increase for 2007 over 2006 was 9.1 % and that was excessive. Councilmember Callies clarified that was Councilmember W oodrufr s recommendation; that did not mean that was a directive from Council. She had concerns that there had been recent instances where a suggestion was taken as a directive. She suggested the Staff prepare a budget that reflected what it thought the needs were for 2008. Mayor Lizee agreed with that comment. Callies stated there are two philosophies - one would be there would be a cap on taxes to fund increased costs; another would be to prepare a budget which reflected actual needs and identified which portion was nondiscretionary spending (this approach would be her preference). Councilmember Wellens agreed that an increase cap be adhered to. Administrator Dawson stated it was imperative that any use of reserves would be done for one-time expenditures; the reserves should not be used to fund general spending. Director Burton stated Staff could strive to stay within the rate of inflation. But items such as fuel costs, health care costs, election costs, etc., may make that difficult. There was ensuing discussion with regard to MSA funds, and the fact that the City had borrowed against future MSA funds. 6. SOUTHSHORE CENTER STATUS REPORT Administrator Dawson stated earlier this year, Senior Community Services (SCS) convened a forum of the five South Lake Minnetonka cities to review the responsibilities for funding the Southshore Center and for their contributions to SCS for senior programming. Dawson then stated at the third meeting in this series of forums, representatives of the Friends Board presented a proposal which, in its essence, would have the cities assume responsibility for costs related to the Southshore Center building, and the Friends would be responsible for raising revenues for the costs associated with providing programs and services in the Center. At that meeting, it was understood by most present that a committee comprised of the city manager/administrators, two or three members of the Friends, and perhaps a few representatives of SCS, would meet to identifY and address issues or concerns regarding the proposal, and to refine it where possible. The committee did not meet until June 18, 2007. Dawson explained the Metropolitan Council issued a Request for Proposals (RFP) for dial-a-ride transit services to cover the "Minnetonka area" which were currently provided by SCS; the contract was awarded to a private for-profit organization. SCS has formally protested the action, and the Metropolitan Council will take up the matter at a meeting on June 22. At present, SCS will provide dial-a-ride service through August 31, 2007. At the June 18 "committee" meeting, whose participants also included members of the cities' councils, the conversation shifted and centered on the likelihood that SCS would not be able to continue its services at the Center, and what could be done for senior programming in 2008. Councilmember Callies stated she agreed with Excelsior City Manager Whittaker that it was premature to endorse the proposals being circulated. Councilmember Woodruff stated it was his understanding that SCS would use its reserve funds to continue providing services at the Southshore Center until September 30, 2007. Administrator Dawson stated he thought it was through October 31, 2007, and that SCS may consider extending that to 2007 year-end. Mayor Lizee stated she thought it was important to continue the process that had been agreed upon to address the funding issues. Councilmember Wellens stated from his perspective the City should not subsidize activities that were exclusive to seniors. He would support funding for the Southshore Center building needs as that was open to the public. Councilmember Woodruff stated that when it was determined what the future role of the Friends would be, its by-laws should be amended accordingly. Administrator Dawson explained the by-laws were defined by the Friends organization; there were also a cooperative agreement and a lease agreement, and all parties are bound to those agreements. Dawson then explained there was an Advisory Board to SCS to provide input with regard to services provided; that Board was separate from the Friend's Board. Councilmember Woodruff commented that the money given to SCS goes into a pool and there was no way to know what portion of the funds comes back to the City. 7. OTHER There was no other business for discussion. 8. ADJOURN Woodruff moved, Wellens seconded, Adjourning the City Council Work Session Meeting of June 25,2007, at 9:00 P.M. Motion passed 5/0. RESPECTFULLY SUBMITTED, Christine Freeman, Recorder C\W~ Ga( Christine Lizee, Mayor