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08-10-15 CC WS Mtg MinMINUTES 1. CONVENE CITY COUNCIL WORD SESSION 5755 COUNTRY CLUB ROAD COUNCIL CHAMBERS 6:00 P.M. Mayor Zerby called the meeting to order at 6:00 P.M. A. Roll Call Present. Mayor Zerby; Councilmembers Labadie, Siakel, and Sundberg; Administrator Joynes; City Clerk Panchyshyn; Finance Director DeJong; Planning Director Nielsen; Director of Public Works Brown; and, City Engineer Hornby Absent: Councilmember Woodruff B. Review Agenda Sundberg moved, Labadie seconded, approving the agenda as presented. Motion passed 4/0. A. South Lake Minnetonka Police Department 2016 Budget Administrator Joynes explained the joint powers agreement (JPA) for the South Lake Minnetonka Police Department (SLMPD) and for the Excelsior Fire District (EFD) both require the SLMPD Coordinating Committee and the EFD Governing Board to deliberate the budgets for their respective organization. The Coordinating Committee has unanimously recommended the 2016 . SLMPD Budget and the EFD Board has unanimously recommended the three 2016 budgets. Each of the member cities of each organization must approve the budgets. Once the member cities have approved the budgets the respective boards will record the adoption of the budgets. Joynes noted the meeting packet contains a summary of the SLMPD budget. Joynes explained that for 2016 Interim Chief Siitari made a case for hiring an extra patrol officer. The costs for that are included in the recommended budget. Siitari realigned some of the existing duties. Different levels of supervision have been changed and assignments made. The Coordinating Committee asked that the costs of the extra officer be funded in 2016 with the use of the projected 2015 surplus to reduce costs to the member cities. Budget reductions in the amount of $69,701 will be used to fund the cost over time. The overall budget increase for 2016 is 3.1 percent. Shorewood's contribution for 2016 will increase by $33,519 for an estimated 2016 contribution of $1,103,665. The total 2016 SLMPD budget is $2,497,229. Each member city experiences the same percentage increase in its contribution under the JPA operating funding formula. The SLMPD operating funding formula is in effect for five years and then it is reviewed and possibly reset for another five years based on three factors — population, tax capacity and initial complaint reports (ICRs). The formula will be reviewed again for 2017. CITY OF SHOREWOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 2 of 8 Mayor Zerby noted the proposed SLMPD budget will deplete the surplus which is different than the reserves. He explained that having a surplus at the end of the year is a good thing because it means the Department did not spend everything that was budgeted for. Usually a surplus goes into the reserves the next budget year. What is proposed means the reserves will not be increased because of a surplus. He likes to use the phrase "wooden nickel" for a situation like that because it takes money out of the fund to pay for a reoccurring expense in order to lower the budget for the first year of the expense. He expressed concern about doing that to fund the new patrol officer position. He did not think his concern was significant enough to vote against the budget. But, he did wane the Coordinating Committee about facing larger budget increases in the future. He stated the SLMPD has incurred a number of significant expenses this year. Some technologies were upgraded; for example, the card reader security system and the network server. He noted that he supports the addition of a patrol officer. He stated the Coordinating Committee Members were clear that the new position was to be used for providing patrol services such as speed enforcement. Zerby stated he continues to think that the JPA operating funding formula needs to be rebalanced. The growth in liquor licenses issued by the City of Excelsior has skewed the amount of policing services Excelsior gets compared to what Shorewood gets for the amount it pays. He noted that he has stated Shorewood should either get what it pays for or Shorewood should only pay for what it gets. Councilmember Sundberg recommended the City be very prepared for discussions about resetting the operating funding formula for 2017. She noted she does not think the formula is equitable now. Councilmember Labadie asked why the formula won't be reset sooner. Administrator Joynes explained there was a mediation in 2005/2006 about the operating funding formula and the mediation resulted in an operating funding formula that three of the four member cities agreed to. Excelsior did not agree to it and forced the dispute into arbitration. The 2006 arbitrator ruled to basically implement the formula mediated and essentially established a review pattern of every five years. All four member cities signed off on that. Mayor Zerby explained the formula was originally constructed to try and reflect the number of hours the police spent in the member cities in previous years. At the start that formula seemed to be equitable. He does not think is it any more. Councilmember Siakel noted that she thought an additional patrol officer should have been added some time ago. She stated she thought the entire amount of time the department spends for each city needs to be reevaluated. She then stated all of the SLMPD member cities are also EFD member cities. EFD member cities do not want to use excess reserves or surplus to fund reoccurring expenses. She went on to state that using a 2015 surplus to fund the new patrol officer position is kicking the budgetary can down the road. That expense should be built into the baseline budget. Director DeJong clarified that the value of each criterion used in the SLMPD funding formula will be updated for the 2017 — 2021 formula but the fundamental formula is not open to renegotiation unless there is agreement by the majority of the SLMPD member cities. Councilmember Sundberg recommended the City look at all of its options. Administrator Joynes noted that Council will consider approving this budget during its regular meeting following this work session. CITY OF SHOREWOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 3 of 8 B. Excelsior Eire District 2016 Budgets Administrator Joynes noted the meeting packet contains copies of the final recommended Excelsior Fire District (EFD) 2016 Operating Budget, the 2016 — 2036 Capital Improvement Program (CIP), and the 2016 — 2036 Building Projects Improvements Program (BPIF). Joynes reviewed the major elements of the 2016 Operating Budget that changed when compared to the adopted 2015 Budget. The Administrative Specialist position was changed from half -time to full -time with 50 percent of the costs to be paid by the City of Chanhassen. The change benefits both Fire Departments and it provides the Specialist with some stability and benefits she did not have as a part- time employee. The Board decided to move some of the Building Maintenance projects into the operating fund. During the 2014 budget process there was a great deal of discussion about the wages for the Fire Chief, Fire Inspector and Administrative Specialist. After researching comparable data of salaries and jobs a Wage Policy was established in 2013/2014. The Policy identified step increases to bring their wages to a point where those employees were reasonably paid. They are not above the average. Those increases are reflected in the recommended Budget. A wage increase is budgeted for the firefighters. The EFD does maintain a 30 percent Operating Fund reserve per its Fund Balance Policy. That is reflected in the Budget. He noted that discussions have already begun about replacing the EFD's Aerial I I ladder truck. Aerial I 1 is slated for replacement in 2018. The replacement cost could be close to $1 million. Joynes explained Shorewood's contribution toward the EFD Budget will go up 0.3 percent or $1,863 for 2016. The total 2016 municipal contribution for fire services is $1,635,079 and Shorewood's share of that will be $615,334. The funding formula for fire is based on tax capacity. He noted Shorewood contracts for fire services on the Islands from the Mound Fire Department and the City's increase in cost for those services for 2016 will be about $500. Councilmember Siakel stated the EFD administrative staff had been significantly underpaid back in 2013. The EFD Board decided to give them larger increases over three years to bring their salaries up to a point where they are reasonably paid. She then stated a major challenge facing the District is keeping and attracting volunteer firefighters. Back in 2013/2014 the firefighters' pay was also evaluated and it was determined their hourly rate was below average. It has been increased so it is a little closer to mid -range for other departments. She noted that she thought the EFD community gets incredible value for the money it pays. It is in the EFD member cities best interest to maintain a volunteer force from a financial perspective. She stated Aerial 11 is the workhorse apparatus for the Department. Administrator Joynes stated the EFD member City Administrators /Manager and Fire Chief have had some discussions about staffing models. The EFD Board authorized the EFD Chief to try a duty crew model for about 4.5 months the later part of 2013. The two stations were staffed with two firefighters from 6:00 P.M. — Midnight on Saturday night. He explained demographics are making it much more difficult to attract paid -on -call (POC) firefighters. They can be called into service any time of the day or night every day of the year. The POC hourly rate is $11 — $12. Firefighters have respond to a certain percentage of calls over a six month period to have those six months count toward their years of service for pension consideration. Individuals who generally apply to be a POC firefighter are generally younger and they don't have time to do that. It is difficult for younger people to find affordable housing in Shorewood and that is required to meet the response time requirements. This is a problem all over the metropolitan area and the country. People are having to reevaluate the POC service model. Some major cities are going back to having a full -time (i.e. career) fire CITY OF SHOREWOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 4 of 8 departments. That is much, much more expensive than a POC department. The candidates the Department interviewed recently were non - traditional applicants; they were not individuals who would be with the Department for 10 — 20 years. One or two of them were over 60 years of age and had been a firefighter before. Councilmember Siakel stated one of the things outstanding regarding future staffing is the consideration of a full-time assistant chief. She thought there will be a need to do that over the next few years. Councilmember Sundberg stated that after reading the information about the replacement of Aerial 11 in with the EFD budget documents she was not convinced that refurbing Aerial 11 or purchasing a used truck would make sense. Based on what she read she recommended people start preparing for the purchase of a new Aerial 11 replacement. Administrator Joynes noted all the options for Aerial I l are expensive. He stated that although used ladder trucks show up on the market periodically trucks are configured differently depending on a department's needs. He explained the Department uses its ladder truck different than some other departments. There are not tall buildings in the EFD community. It used to stage the entire fire scene from an elevated position. To be able to apply water and retardants from that platform is valuable and needed. There are many places in the community where it is difficult to get trucks close to a property. Councilmember Sundberg stated the EFD community is very fortunate to be served by the quality of professionals the Department has. It is prudent that they be compensated fairly. This is not the time to be penny wise and dollar foolish. Administrator Joynes stated that thanks to Councilmember Siakel in large part the hard fought battle about compensation ended with a positive outcome. Councilmember Sundberg thanked Councilmember Siakel for working for that and stated it is hard to feel good about EFD staff still being paid below the market average. Siakel noted it was a significant improvement. Councilmember Siakel noted that Aerial 11 is the first truck out of Station 1 in part because of how narrow some of the roadways in the community are. She stated she thought the EFD Board was moving in the direction of purchasing a new ladder truck. Director DeJong explained Engine 22 will be paid off in 2017 and the yearly payment for that is more than $87,300. If the replacement for Aerial 11 were to be a 10 -year lease /purchase arrangement the $87,300 would go toward minimizing the impact on the EFD CIP for the first five years. 3. 2015 — 2024 CAPITAL IMPROVEMENT PROGRAM AND 2016 GENERAL, FUND BUDGET DISCUSSION • Recommended Capital Improvement Program and Tax Levy for 2016 Administrator Joynes explained that during Council's July 27, 2015, work session there was discussion about the 2016 Capital Improvement Program (CIP) and the changes staff made to it to eliminate any deficit in funds through 2017. He displayed a slide showing the changes in transfers out of the General Fund into various CIP funds. The transfer from the General Fund into the Equipment Replacement Fund had been increased by $15,000. The transfer from the General Fund into the Street Improvement Fund had been increased by $15,000. He noted he thought there was Council consensus to do that. He noted that per Council direction the City's draft 2016 General Fund Budget reflects a 2 percent increase in the tax levy. He then noted Council did not authorize an additional 1 percent levy increase CITY OF SHOREWOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 5 of 8 specifically for the Shorewood Economic Development Authority (EDA). Council decided if there was a need for the EDA to have operating funds in 2016 funds could be transferred from the General Fund reserves to cover that. Director DeJong asked if Council will support what has been proposed for the 2016 tax levy. ]Badger Park Improvements 1 Lacrosse Association Request Councilmember Siakel stated during the July 27 Council work session there was discussion about the reality of making major improvements to Badger Park in 2016. She thought there was Council consensus to wait until there was a better understanding of how the former Minnetonka Country Club (MCC) will ultimately be redeveloped. The Parks Improvement Fund still shows improvements being made in 2016 and 2017. She thought making improvements in 2018 and 2019 was more realistic. She also does not fully support making $73,000 in improvements to the Skate Park in 2016. She noted that she would prefer not to show a deficit in that Fund when the work will not begin in 2016. Director DeJong stated the Park Commission has not recommended making any changes to the Park Capital Improvement Program (CIP). He explained that he and Director Nielsen spoke with Park Commission Chair Mangold earlier in the day about the CIP to ensure nothing had been left out of the CIP and to bring the CIP to the Commission during its September meeting. They will solicit recommendations from the Commission on the CIP. Councilmember Sundberg asked if the Park Commission is aware of the development opportunity that is up in the air for the area around the MCC property. Depending on what moves forward Badger Park could change dramatically or possibly be eliminated. Director Nielsen stated the Commission is fully aware of the development potential in the area. He noted the MCC Planning Advisory Committee (PAC) advised against "blowing up" Badger Park and putting senior housing in there. Nielsen then stated from the Commission's perspective, putting the Southshore Center aside, there is no reason not to move forward with the improvements to Badger Park. The commercial area north of the Park could develop around the Park. The northwest quadrant of the Smithtown Crossing Redevelopment Area has little bearing on Park Improvements. The Commission has made no recommendation to do something different with the Park. Sundberg stated she was somewhat befuddled with those comments because there are so many unknowns; unknowns about the Southshore Center, the development possibilities and the former MCC property. From her perspective it would make sense to keep Badger Park as is until things are settled rather than make plans and assumptions. Nielsen stated the only assumption the Park Commission has made is the Southshore Center is going to remain where it is. If Council has some thought that will not be there in the future then Badger Park improvements can wait until that decision has been made. Sundberg noted that she thought it is risky to assume the Southshore Center will stay in its current location. She stated from her perspective there are a lot of things that need to be sorted out. She clarified that she values the Southshore Center. Park Commission Chair Mangold clarified he would like to put his framework around the Badger Park discussion. He explained every Park Commission recommendation has been that Badger Park should remain a park. The Commission took a few years to come up with a concept plan for the Park. It took into consideration all of the City's parks and the Southshore Center. The concept was not a simple discussion. The Commission brought its concepts forward to Council. It ultimately came forward with a revised concept, Concept 1.5, which Council approved for the next stage and then the MCC redevelopment came about. CITY OF SHOREWOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 6 of 8 The Commission has not been given any direction from Council regarding what to do. The Commission has a huge issue of where things are at and what it needs to do going forward. There are other elements that have been brought forward. One element is lacrosse. He stated the Commission needs Council not to make a final decision about a concept for Badger Park but instead provide the Commission with direction on how to move forward. The Commission believes if Badger Park is developed it will improve the Southshore Center. From his perspective if the Southshore Center went away it would be highly unlikely the site could be redeveloped for senior housing because of the poor soils there. Mangold stated he thought improvements to Badger Park will happen at some point. The park Commission needs to start defining what that is going to be again. He then stated that he has been on the Commission for four years and there are only two Commissioners who had been around for the Badger Park discussions from early on. He asked if Council wants the Commission to take Badger Park out of the CIP and work on other things or should the Commission and Council iron out more of what is going on there. He noted that for Badger Park improvements the next stage is to get out of the concept phase and move into the development phase so the Commission can work with the Minnetonka Lacrosse Association. Councilmember Labadie stated. Lacrosse Association representatives did come before Council and present some ideas. She asked if they have presented more to the Park Commission since then. Chair Mangold stated the Association has access to a different set of funding grants. The Association is trying to determine where its home base will be and then describe what it is offering in a grant. If the City has a project defined and the Association is a piece of it that makes it better for the Association then just saying it needs grant money for some unknown field. The Association has not formalized that because the City has not said what it is going to do. Labadie asked if there is a deadline for that grant application. Mangold stated he does not know and commented that the Association is not going to wait a couple more years. Councilmember Siakel suggested picking a date for a joint meeting of the Council and Park Commission. She assumes that will happen during Council's regular meeting following this work session. She noted that not knowing how to move forward with Badger Park must be frustrating for the Commission. She stated that she has always envisioned that there will Badger Park but the question is what amenities there will be in the Park. Chair Mangold stated if that is true he asked if that meant the Concept 1.5 plan for the Park is being scraped. Administrator Joynes noted the City does not have funding for all of the improvements identified in Concept 1.5. He stated when the City works with developers on a development project unless there is a signed document there is no guarantee the project will come to fruition. It is not out of the question that there could be another real estate bubble or a significant increase in the interest rate could cause the project to go away for example. He hopes those things relative to the MCC redevelopment project should be known in the fall. Once that is known then decisions about Badger Park will be easier to make. He noted Council cannot commit until things fall into place. Chair Mangold asked if there should be a placeholder in the CIP to keep the plan going. If it doesn't end up being done in 2016 so be it. He questioned if could be put back in later if it is taken out now. Councilmember Sundberg clarified that she did not intend that the placeholder for Badger Park be taken out of the CIP but only that it be pushed out a year or two. She expressed concern about putting the cart before the horse. She noted that she does not want to commit to the Lacrosse Association at this time. Administrator Joynes clarified that the CIP can be modified at any time. He stated in a couple of months he thought the City would have a much better idea about the redevelopment of the former MCC property. CITY OF SHOREWOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 7 of 8 Councilmember Sundberg stated she does not want to mislead the Park Commission. Chair Mangold stated there needs to be a joint meeting and before going into the meeting he would like to know if Concept 1.5 is still the plan being considered. He commented that Concept 1.5 was approved by Council before the MCC property was sold to a developer. The plan for redeveloping that property does not directly affect Badger Park. Administrator Joynes stated the City is being pressured to make a decision about a lacrosse field. Staff has been hesitant to do that because of what is currently being discussed. From his perspective the decision about a field should be delayed. He then stated he thought staff could come up with an estimate of resources and revenues by mid- October. Mayor Zerby stated it is his understanding that the current ball field in Badger Park is in need of some repair. He heard the football league brought the issue of divots to the City's attention. He asked if an item should be put in the CIP to make the repairs to the ball field should major Badger Park improvements be postponed. Director Nielsen stated the plan is to reconstruct the field. It needs to be regraded, new material needs to be put down and it needs to be drained. The field is very compressed and when children fall on it to them it feels like falling on a bituminous surface. Zerby stated the Lacrosse Association has proposed an artificial turf field. Council supported investigating that more. He then stated if the major Badger Park improvements are put on hold he had concern that required maintenance to the ball filed may not be done and sports organizations could decide to use other fields. Nielsen stated aerating the field would loosen the ground up a little. Zerby noted he does not want maintenance of the field stopped. Councilmember Siakel asked how the construction of an artificial turf lacrosse field would be financed. What does partnering with the City mean to the Lacrosse Association? She stated she thought lacrosse is a growing sport and it could be worthwhile to partner in constructing a field that would be used. She asked if the Association would use a new field more than a soccer league would. It may be prudent to reevaluate how all of the City parks are being used. She asked if there is a place for a lacrosse field in Freeman Park. Director Nielsen responded a. soccer field could be turned into a lacrosse field in Freeman Park and noted football uses the field in Badger Park. Nielsen also noted that he has been told that there are times teams play lacrosse on the soccer fields in Freeman Park. Mayor Zerby stated he has been told that the ball field in Freeman Park is the only field used by the particular age group that uses it. Councilmember Labadie expressed concern about there possibly not being adequate parking at Badger Park for lacrosse tournaments. Director Nielsen suggested the City come up with a sports tournament policy. Parking for large tournaments is a problem at all of the City's parks. He stated he does not think parking is an issue for weekly sports use of the fields. Nielsen stated that he encouraged Council to review the planning work that had been done by the Park Commission before the joint meeting of the Council and Park Commission. The Commission worked on the original Parks Master Plan and it reviewed it again in 2014. That Plan states that Freeman Park is the primary park where organized sports are played. It is the central park, the largest park and the park with the most parking. He commented that hockey is played in Cathcart Park and football and lacrosse are played in Badger Park. He stated it is important for Council and the Park Commission to have a similar vision for Badger Park and the parks in general. CITY OF SHORE' WOOD WORK SESSION MEETING MINUTES August 10, 2015 Page 8 of 8 Administrator Joynes stated that Council has not made a decision about the $40,000 in the 2016 budget for a forester / water resources position. It is still in the budget. He reiterated the budget assumes a 2 percent tax levy increase for 2016. Councilmember Siakel stated that 2 percent tax levy increase is the goal. But, because there is a lot happening now she suggested certifying a maximum levy of 3 percent. She explained the final levy can always be reduced but it cannot be increased. Councilmember Sundberg concurred with doing that. Siakel clarified she does not want 3 percent to be built into the preliminary budget. Mayor Zerby concurred with the comments. Administrator Joynes stated Council will set the maximum 2016 tax levy during its September 14 meeting. Mayor Zerby stated he appreciated the work staff has done on the budget and CIP. C�i`lalilil_`7�l Sundberg moved, Siakel seconded, Adjourning the City Council Work Session of August 10, 2015, at 6:51 P.M. Motion passed 4/0. RESPECTFULLY SUBMITTED, Christine Freeman, Recorder Scot erby a or Jean Panchyshyn, City lerk