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092809 CC Reg MinCITY OF SHOREWOOD CITY COUNCIL, REGULAR MEETING MONDAY, SEPTEMBER 28, 2009 5755 COUNTRY Y CL ROAD COUNCIL CHAMBERS 7:00 P.M. Mayor Lizee called the meeting to order at 7:05 P.M. A. Roll Call Present. Mayor Lizee; Councilmembers Bailey, Turgeon, and Woodruff; Attorney Tietjen; City Administrator Heck; Finance Director Burton; Planning Director Nielsen; Director of Public Works Brown; and Engineer Landini Absent: Councilmember Zerby B. Review Agenda Bailey moved, Woodruff seconded, approving the agenda as presented. Motion passed 4/0. 2. APPROVAL OF MINUTES A. City Council Work Session Minutes, September 8, 2009 Turgeon moved, Bailey seconded, Approving the City Council Work Session Minutes of September 8, 2009, as presented. Motion passed 4/0. B. City Council Work Session Minutes, September 9, 2009 Turgeon moved, Woodruff seconded, Approving the City Council Work Session Minutes of September 9, 2009, as presented. Motion passed 4/0. C. City Council Work Session Minutes, September 14, 2009 Bailey moved, Woodruff seconded, Approving the City Council Work Session Minutes of September 14, 2009, as presented. Motion passed 4/0. D. City Council Regular Meeting Minutes, September 14, 2009 Woodruff moved, Bailey seconded, Approving the City Council Regular Meeting Minutes of September 14, 2009, as presented. Motion passed 4/0. 1�001=129VWMMMZ M Mayor Lizee reviewed the items on the Consent Agenda. Turgeon moved, Woodruff seconded, Approving the Motions Contained on the Consent Agenda and Adopting the Resolutions Therein. A. Approval of the Verified Claims List CITE? OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES September 28, 2009 Page 2 of 7 F. Adopting RESOLUTION NO. 09 -052 66 A Resolution Accepting Quote and Awarding Contract for 2009 Sanitary Sewer Jet Vacuum Cleaning, Main Line Televising, Structure Inspection, Lateral Inspection and Internal Chemical Grouting Project." Motion passed 4/0. 4. MATTERS FROM THE FLOOR Mayor Lizee noted that student Nick Lentz was present this evening to satisfy a requirement of a government class he is taking at the Holy Family High School. 5. REPORTS AND PRESENTATIONS A. Patrick Hodapp, Report on Lake Minnetonka Communications Commission Activities Mayor Liz6e stated Patrick Hodapp, the Lake Minnetonka Communications Commission (LMCC) Executive Committee Vice Chair and the City's Council appointed citizen representative on the LMCC, was present this evening to provide Council with an update on LMCC activities. Mr. Hodapp stated the LMCC purchased the facility it had been leasing on a contract for deed basis with a five -year deed term. The LMCC will end up having title to the facility at the end of five years for approximately the same cash outlay it would have had if it had continued to lease the facility. Although the facility may or may not serve the needs of the LMCC in the long term, it will do that for the next five years. If at the end of the five years the LMCC determines the facility no longer satisfies its needs, the LMCC will have enough equity in the facility to cover build -out costs. He then stated the LMCC's 2008 full audit was completed; it was the third year in a row it was conducted by an independent CPA. Over the last three years the LMCC has been implementing some of the suggestions made by the CPA regarding internal controls. Mr. Hodapp then stated the LMCC had an independent auditor conduct an audit of the Mediacom franchise fee payments for years 2006, 2007 and 2008. The LMCC's franchise agreement with Mediacom indicates the LMCC is entitled to five percent of Mediacom's total revenues from franchise fees. Based on the findings it appears Mediacom underpaid the LMCC by $50,000 - $60,000 with the likely reason being Mediacom did not collect enough franchise fees from its subscribers. The independent auditor looked solely at revenue when determining Mediacom under paid the LMCC. Mediacom has indicated it doesn't have a problem paying the LMCC what's it due but it hasn't collected for it. The LMCC hopes Mediacom will pay the amount due the LMCC without charging it back to its subscribers. Mr. Hodapp stated the LMCC receives homes passed data monthly from Mediacom. He explained under the current franchise agreement there has to be a certain density requirement at which Mediacom is required to offer service. Homes passed data is the number of customers Mediacom is required to offer service to. Mediacom used that data to successfully argue there was effective competition from satellite television. Because of that the LMCC lost its authority to regulate the sub -basic cable rates. Mediacom increased basic cable rates when that happened. Mr. Hodapp then stated the LMCC's funding model is outdated. He explained the franchise administration portion of the fees the LMCC collects is considerably less then its fees for providing all the community services. When the LMCC was originally conceived video recording and displaying of council meetings were not discussed, and there was no such thing as video on demand. The LMCC member cities are now asking for those services yet the cable subscribers are the only ones paying for it. He did not think that is a fair solution. One option in the future would be to separate cable programming from public, education and government (PEG) media and education. One approach to handling that would be to collect a very small federal tax to be reallocated on all data services. Another way to handle it would be to greatly reduce the franchise fees that are collected and instead have city contributions. The second approach would have residents pay on a fairer basis. Councilmember Bailey asked how PEG programs reach satellite television subscribers. Mr. Hodapp explained they don't, but they can be accessed through the internet. Councilmember Woodruff stated the LMCC should have a strategic discussion about the funding model. He agreed the current model is not appropriate for today's environment. He commented council meetings can be viewed over the internet, but programs such as square dancing can't. He stated if all of the content offered on cable is offered on the internet, he didn't think it would be fair to only charge cable subscribers. Mayor Liz& stated all forms of media are facing the similar problems of having all people who access the information pay for it; not just certain revenue generators. Councilmember Woodruff stated the LMCC financially depends totally on franchise fees and PEG fees collected through Mediacom. Should there be a reduction in Mediacom subscribers that will significantly affect the LMCC's ability to deliver services. Councilmember Turgeon questioned if it would be possible for the LMCC to negotiate to receive a higher rate from Mediacom when the franchise agreement is renegotiated. Mr. Hodapp explained Mediacom currently charges 5 percent on video services and by federal statute it cannot charge anymore. The LMCC cannot receive any franchise fees cable modem services per federal regulations. He thought with the local franchise agreement there is a $1.00 cap on PEG fees. He stated he thought it appropriate to consider these things when the franchise agreement is renegotiated, He noted when there is only one provider who owns the infrastructure negotiations tend to benefit the provider. CITY OF SHOREWOOD REGULAR COUNCIL MEE'T'ING MINUTES September 28, 2€ 09 Page 4 of 7 None. VANNEEFIVEMITMi No report was given because there had not been a Park Commission meeting since the last City Council regular meeting. The next Park Commission meeting is scheduled for October 13, 2009. '�fl No report was given. A. Conditional Use Permit — Silverwood Park Shelter Applicant: City of Shorewood Location: 5775 Covington Road Director Nielsen explained the City's Park Master Plan for Silverwood Park has included a small, open shelter for a number of years. The shelter was to be located on the west side of the pond in the Park. As part of the effort to update Master Plan the Park Commission now proposes to locate the shelter between the play area and the parking lot. The shelter is very simple; there is a concrete slab with four steel columns on it to support a metal roof. There will have to be a small amount of fill brought in to level out grade at the new proposed location. The creation of the shelter is included in the Park Capital Improvement Program. The Park Commission held a poorly attended neighborhood meeting about the proposed shelter. The City's Zoning Code requires public recreational buildings be handled by the conditional use permit process. Therefore, the Planning Commission held a public hearing during which there was no public comment. Nielsen stated Staff, the Planning Commission and Park Commission recommend approval of the shelter as proposed. He noted the meeting packet for this evening contains a resolution for Council's consideration. Bailey moved, Woodruff seconded, Adopting RESOLUTION NO. 09 -053 "A Resolution Granting a Conditional use Permit for the Construction of a Shelter Building for Silverwood Park." Motion passed 4/0. 9. ENGINEERING/PUBLIC WORKS Nothing for discussion this evening. CITY OF S OR WO D R GU ,AR COUNCIL MEETI G MINUTES September 28, 2009 Page 5 of 7 1. GENERAL/NEW BUSINESS This item was removed from the consent agenda at Councilmember Woodruff s request. Councilmember Woodruff explained the reason he asked this be removed from the consent agenda was because Staff identified three options for Council to consider. Woodruff moved, Bailey seconded, accepting Staff's recommendation to appoint Bryan Backes to the position of Light Equipment Operator — Utility Operator. Motion passed 311 with Turgeon dissenting. B. Authorize Expenditure of Funds for Proper Disposal of Street Sweepings This item was removed from the consent agenda at Councilmember Woodruff s request. Councilmember Woodruff stated it appears Staff is recommending Council award the contract for the 2009 Street Sweeping Spoils Disposal to Midwest Asphalt for an amount not to exceed what is in the 2009 Streets and Roadway budget for this effort; an amount of $9,000. Yet the low bid, which is from Midwest Asphalt, is for $12,000. Woodruff moved, Bailey seconded, awarding the contract for the 2009 Street Sweeping Spoils Disposal with estimated spoils to be 400 tons to Midwest Asphalt for an amount not to exceed $12,000 with $9,000 being funded out of the Streets and Roadway Fund and $3,000 from the Stormwater Fund. Councilmember Woodruff stated he did not think it would be a good idea to store the spoils that would not be disposed of because of things such as runoff issues, and it would probably cost more in 2010. In response to a question from Councilmember Bailey, Director Burton explained the Stormwater Fund was adequately funded to cover the $3,000 unbudgeted expense. Motion passed 4/0. 11. STAFF AND COUNCIL REPORTS A. Administrator and Staff Administrator Heck stated the Metropolitan Council (Met Council) has been discussing replacing the Inflow & Infiltration (I &I) surcharge with something called a demand charge. The Met Council is considering implementing the Demand Charge in 2012. An I &I surcharge is refundable if a city makes progress in reducing its I &I. The demand charge would not refundable. Met Council has established a seventeen member task force to evaluate and recommend the demand charge process. The Met Council is not generating enough revenue from its service available charge (SAC) to fund the expansions of its sewer system. It's considering a 3.8 percent SAC increase in 2010, a more than 4 percent increase in 2011 and another increase in 2012. It approved a 75 percent discount for the SAC for certain outdoor spaces. Heck stated he would provide Council with more information on this. He encouraged Councihnembers to attend the next "listening session" on these items, noting the session will be conducted in the City of Minnetonka. CITE' OF SHO EW OD REGULAR COUNCIL MEE'rI C MINUTES September 28, 2009 Page 6 of 7 Director Nielsen stated the American Legion has requested additional time to remove the fill from one of its properties. Director Brown stated the issue of Qwest moving its lines on Smithtown Lane has not been resolved. An even larger issue has come up recently. The Minnetonka School District owns an aerial fiber optic line which resides on the pole where the cul -de -sac will be. The manager of this line is considering applying to have the Line buried on the north side of Smithtown Road. There are rights -of -way and prescriptive rights issues that must be dealt with before that could occur. Staff prefers the line remain aerial. He then stated because of the predicted rains, the issue with Qwest and the issues with burying the fiber optic line Staff recommends conducting the Smithtown Lane project in the spring of 2010. Brown commended Northwest Asphalt for the job it did on the Harding Lane and Harding Avenue project. He stated its crew hustled nonstop. Curb will be put down on the two roads on September 29` Councilmember Turgeon asked Staff to thank WSB & Associates for digging out the pond. Director Brown stated more work will be done on the pond. Councilmember Bailey asked what message will be conveyed to the residents along Smithtown Lane about the delay of the Smithtown Lane project. Director Brown stated the residents will be sent a letter on September 29`'. Bailey asked if the- residents will be told they the delay is caused by circumstances outside of the City's control, to which Brown responded they would. Bailey asked if there is reason to believe Qwest will move its lines next spring. Brown stated he thought that would happen. Brown explained the issue with the Minnetonka School District will take time to resolve because the City doesn't have control over all the needed rights -of -way. He thought it would come down to negotiations with the District. He explained the District had applied for a permit and has a right to maintain the fiber optic line in its existing position. One of the conditions of the permit is the City can ask the line be moved. The City has held up the District's permitting process as the City tries to sort through the legalities of re- permitting the line so that it can be relocated. He is not sure the City has the ability to locate the line along Smithtown Road. He noted that once a fiber optic line is strung it has a fixed length; in order to relocate a line it has to be restrung. Councilmember Woodruff stated that from his vantage point the Smithtown Lane project has been a learning experience. He commented that he became aware of the Qwest and the fiber optic line issues maybe two meetings ago, and he was not sure when Staff became aware they were potential issues. He thought discussions should have occurred with Qwest and with the School District in the spring when the project was being discussed, noting the cul -de -sac had not been approved as part of the project at that time. He encouraged the new pole be installed this fall and that Qwest move its line this fall. Director Brown explained Staff acted appropriately in providing the utility companies proper notification when working with them throughout the design process. The School's District fiber optic line happened to be an anomaly. Staff knew the line was there but did not think it would become a logistics issue from the District's perspective. He was confident Staff did its due diligence in notifying everyone early on. B. Mayor and City Council Councilmember Bailey stated he attended the Excelsior Fire District's (EFD) Governing Board meeting on September 23' Prior to that meeting the Board conducted EFD Chief Gerber's performance review, noting the Board thought Gerber had been doing a more than adequate job. He explained the Board adopted the 2010 budget as approved by the member cities' councils. The budget included a $120,000 mandatory contribution to the Excelsior Firefighters Relief Association (EFRA) for pension purposes. The mandatory contribution is composed of two things. One is the per - year -of- service benefit which each firefighter accrues each year. The other is a deficit reduction in the EFRA fund (the fund used to pay CITY OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES September 28, 2009 Page 7 of 7 fighters pensions). The deficit was caused by the poor investment market in 2008. The fund is under funded now and by State Statute that deficit has to be eliminated over a period of ten years. When the mandatory contribution was first discussed in March 2009 it was estimated that the member cities' contribution would have to be approximately $120,000 a year for the next ten years. The recovery of the markets has reduced the amount significantly. It appears that currently the yearly required contribution would be closer to $80,000. The $120,000 mandatory contribution in the budget was funded through expense reductions and the use of a total of $80,000 in reserves being taken from two funds. The Board had preliminary discussions about what to do with the possible excess of $40,000 not needed for the mandatory contribution. There was discussion about replenishing some of the reserves, restoring some of the expense reductions (such as training and wage increases), and so forth. He thought the preliminary discussion was leaning toward replenishing the reserve funds. The Board will not finalize that until the November 18` Board meeting. He offered to discuss Council's recommendations for what to do with the excess funds during a future Council meeting. Mayor Lizee suggested it be placed on the October 12, 2009, Council meeting agenda. Councilmember Turgeon commented the grass at Gideon Glen is all brown. Director Nielsen explained the area has been treated once and it will be treated a second time. After that is done it will be planted with prairie grass. Turgeon stated she has subscribed to receive the City's newsletter electronically. Unfortunately she continues to receive it in print form also. Mayor Lizee stated the EFD open house and safety program is scheduled for October 8, 2009, from 6:00 P.M. — to 8:30 P.M, and there is a South Lake Minnetonka Police Department Coordinating Committee meeting tentatively scheduled for October 21, 2009. She indicated she plans on attending the Metropolitan Council meeting on traffic scheduled for September 29, 2009. Councilmember Turgeon stated there is a grand re- opening of the Southshore Community Center schedule for October 9, 2009, from 6:00 P.M. — 9:00 P.M. f�►��11��1/� 7�1 Turgeon moved, Bailey seconded, Adjourning the City Council Regular Meeting of September 28, 2009, at 8:00 P.M. Motion passed 4/0. RESPECTFULLY SUBMITTED Christine Freeman, Recorder Christine Lizee, Mayor