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10-24-16 CC WS MinCITY OF SHOREWOOD CITY COUNCIL WORK SESSION MONDAY, OCTOBER 24, 2016 uMTu►ff W 1. CONVENE CITY COUNCIL WORK SESSION 5755 COUNTRY CLUB ROAD COUNCIL CHAMBERS 6:30 P.M. Mayor Zerby called the meeting to order at 6:30 P.M. A. Roll Call Present. Mayor Zerby; Councilmembers Labadie, Siakel, Sundberg, and Woodruff; Acting Administrator /City Clerk Panchyshyn; Finance Director DeJong; Director of Public Works Brown; and, Engineer Hornby Absent: None B. Review Agenda Sundberg moved, Labadie seconded, approving the agenda as presented. Motion passed 510. 2. ENTERPRISE BUDGETS AND CAPITAL IMPROVEMENT PROGRAM FINAL REVIEW Director DeJong noted there has been almost no change to the 2017 Capital Improvement Program (CIP) since it was last discussed in July. He stated there are differing opinions amongst the members of Council about the priorities of some roadway improvement projects. There are challenges with how to proceed if Council wants to coordinate a project with the City of Minnetrista. He highlighted the minor changes to the street sealcoat schedule. 1. The sealcoat of Anthony Terrace has been moved from 2016 to 2017 because of a change order to the 2016 . project due to a supplier shortage of oil. The approximate cost for the project is $2,000. 2. The sealcoat of Covington Road has been moved from 2015 to 2017 because the Metropolitan Council Environmental Services project is complete and the roadway has been patched. A seal coat would extend the life of the repaired roadway. The approximate cost for the project is $14,000. 3. The sealcoat of Vine Street has been moved from 2016 to 2017 because of a change order to the 2016 project due to a supplier shortage of oil. The approximate cost for the project is $3,000. 4. The sealcoat of Smithtown Road has been moved from 2018 to 2017 because of the new patching from County Road 19 to Eureka Road North that was needed because of the Smithtown Road east sidewalk extension project. Sealcoating that roadway in 2017 would significantly extend the life of the roadway. The approximate cost for the project is $72,000. DeJong noted that the dollars that are carried forward from 2015 and 2016 into 2017 combined total about $14,000. CITY OF SHOREWOOD WORK SESSION MEETING MINUTES October 24, 2016 Page 2 of 7 In response to a question from Councilmember Sundberg, Engineer Hornby explained there is a seam along Smithtown Road created during the sidewalk construction so sealcoating the roadway will protect it. Director DeJong explained the significant roadway projects that have been advanced in the street maintenance schedule are located on Enchanted and Shady Islands. The reason they have been advanced is to possibly reap the benefits of coordinating the improvements to Enchanted Lane with the City of Minnetrista. He stated he thought most of the roadways on the Islands are in the flood plain. He also thought two years ago when there was a tremendous amount of rain most of the roadways on the Islands were under water. He explained if the height of Enchanted Lane was increased as part of a reconstruction or a mill and overlay that would cause flood plain water storage issues for the Minnehaha Creek Watershed District (MCWD). Staff believes it would be advantageous for Shorewood and Minnetrista to coordinate the flood plain storage mitigation plan. He noted staff has estimated the proposed improvements to the roadways on the Islands to cost about $500,000. If the improvements were coordinated staff estimates the savings in design fees and equipment mobilization costs to be about $50,000 (or about 10 percent). He explained the challenge is Minnetrista has not gone through its public process for its improvements yet. Engineer Hornby has indicated that the Minnetrista City Council will discuss the proposed improvements during its November 14 meeting and that a public information meeting is scheduled for November 15. It will not be known if there will be a project to coordinate until those meetings have occurred. DeJong noted it is his understanding there are more Minnetrista residents opposed to the project than in favor of it because of the property assessments that would be imposed on property owners. Mayor Zerby asked if Minnetrista's preliminary CIP includes funding for the project. Engineer Hornby responded yes. Engineer Hornby explained Minnetrista assesses for those types of roadway projects. The assessment rate has not been determined yet. During that November 14 Minnetrista Council meeting the preliminary layout and some of the costs will be presented. That same information will be presented to the residents on November 15. Minnetrista has expanded its project to include Tuxedo Road. He clarified Minnetrista is in the feasibility phase at this time. Director DeJong stated staff is seeking direction from Council on how to move forward with the roadways on the Islands in the CIP. Should the improvements be put back to 2023/2024 as originally planned? Or, should they be advanced to 2017 unless Minnetrista does not choose to move forward with its project? Mayor Zerby asked if there are two parts to the project for Shorewood. Was there one area where flooding caused damage to Enchanted Lane yet other areas where there was minimal damage from flooding? He asked if the roadway closest to the bridge should be done as a coordinated effort with Minnetrista without requiring improvements to the other roadways on the Islands at the same time. Director Brown stated Enchanted Lane tends to flood more than the other roadways and noted that Enchanted Lane serves as the main access to the area. Zerby then asked if the improvements are an all or nothing proposition. Director Brown stated the City could work with Minnetrista on Enchanted Lane improvements near the bridge only to lessen the financial impact. Zerby stated if Minnetrista is going to raise Enchanted Lane and Shorewood does CITY OF SHOREWOOD WORK SESSION MEETING MINUTES October 24, 2016 Page 3 of 7 nothing he asked if there will be a drop in the roadway at the Shorewood border. Brown stated there would be a transition and noted the roadway would be designed for a 25 — 30 miles per hour (mph) speed. Director Brown stated if Enchanted Lane is raised in Shorewood there is flood plain water storage mitigation that has to be done. For example, if a cubic yard of flood storage is taken away then it has to be put back somewhere. That would be more challenging to do if Shorewood did that by itself as opposed to doing it in conjunction with Minnetrista; it could be done but it would cost Shorewood to do it alone. Councilmember Labadie stated that she thought it would make sense to work in conjunction with Minnetrista on Enchanted Lane if Minnetrista moves forward with that. But, she is not sure she supports doing the other Island roadways in 2017. If Minnetrista does not moved forward with Enchanted Lane improvements she does not support Shorewood moving forward with its improvements to Enchanted Lane in 2017. Councilmember Siakel stated the City has a 20 -Year Pavement Improvement Plan (PMP) and she recommended the Council try to adhere to the PMP as much as possible. Over the last few years it seems like projects are being advanced in the schedule without projects being pushed out. If that continues the City is going to get in a financial position where it is going to have to tax property owners a lot more. She clarified that she was not objecting to paying for improvements to the roadways on the Islands; her concern is about how that would be done. She explained that the City has reserves in excess of those stipulated in the City's General Fund Balance Policy. Council has discussed many uses for those excess reserves. She noted that she does not support taking all of the excess reserves to make improvements to the roadways on the Islands ahead of schedule. She stated Council has discussed using excess reserves to address issues related to the Southshore Center. There are additional things that could be done to Badger Park with the use of those excess reserves. She clarified that she was not opposed to using some of the excess reserves for the roadways on the Islands; in particular, the area of Enchanted Lane near the City border near Tuxedo Road. She noted she was not in favor of using all of the excess reserves to pay for those roadways. She wants to adhere to the PMP. She stated that because Minnetrista assesses for projects like roadways improvements she heard earlier in this discussion that many of its residents are not in favor of doing that project. She then stated that she drove those roadways earlier in the day. There were some areas where the roadways are a little choppy. Those conditions start back in the City of Mound. She went on to state she wants to get a better understanding of the cost of the improvements and the savings that could be realized by doing the Enchanted Lane portion in conjunction with Minnetrista. She also wants to know what impact advancing improvements to the roadways on the Islands has on other roadway projects. Siakel reiterated the City has a plan and she wants the City to work its plan. Councilmember Woodruff clarified that no part of Tuxedo Road is located in Shorewood; it ends before the bridge to Enchanted Island. He explained that currently the roadways on the Islands are generally at a level that would qualify them to be milled and overlaid at a minimum. He then explained the PMP was created about eight years ago and it has been updated to reflect current road conditions. When the PMP schedule was developed it was based on Engineering and Public Works estimates of when the roadway CITY OF SHOREWOOD WORK SESSION MEETING MINUTES October 24, 2016 Page 4 of 7 surfaces would deteriorate to the point where they warranted some maintenance action. For the most part, the roadways on Enchanted and Shady Islands have deteriorated faster than anticipated. He noted that he would not be advocating moving those roadways up in the PMP if the City was not going to potentially be able to save a fair amount of money but doing the project at the same time Minnetrista does its project. If the project is expanded to include other roadways it would spare the residents from having to experience construction inconveniences twice, noting Shorewood residents on are the majority of the residents living on the two Islands. He expressed his support for continuing to work with Minnetrista. He stated if it makes financial sense for the City to do its project in conjunction with Minnetrista he suggested the City do that. The City has or can find the money to do that. From his perspective that would not steal the money from improvements to another roadway; it would not push another roadway out in the schedule. He stated that using excess reserves for roadways would be a good use of the reserves because the road plan needs the money if the roadways on the Islands are advanced in the schedule. Woodruff noted that from his perspective he thought doing the project in conjunction with Minnetrista makes good financial and business sense to determine what Minnetrista is doing. Councilmember Sundberg stated before Council makes any decision she recommended it wait until it knows for sure what Minnetrista is going to do. If Minnetrista moves forward with its project it would make sense for Shorewood to take advantage of the savings it could realize by doing its project at the same time. She noted she understood Councilmember Siakel's concerns about using all of the excess reserves to do that work. Councilmember Siakel asked if staff was talking about a total reconstruction or a mill and overlay. She stated she would be in favor of improving a portion of Enchanted Lane but she thought doing everything would be premature. She then stated that a portion of the roadways are in need of repair; that is not different than many other roadways in the City. She went on to state Council needs to have a better understanding of the costs and savings and if Minnetrista is seriously considering moving forward with its project. Councilmember Woodruff clarified that he was not talking about reconstructing roadways on the Islands. It is his understanding that the soils there would never tolerate the work. The discussion has always been about a reclamation or a mill and overlay project. Director Brown noted that each year in October he rates each roadway. He stated there have been many versions of the PMP. They have included sealcoating, mill and overlay, reclamation and reconstruction. Staff believes the only thing feasible for those roadways is a mill and overlay or reclamation because of access issues and the narrowness of the roadways. Mayor Zerby stated he viewed the PMP as an estimate. It is difficult to project out 20 years and be accurate. He then stated that for now he can support leaving the roadways on the Islands in the 2017 Street Reconstruction CIP to give the City an option. He clarified that is not an approval to spend the money. He went on to state that next year Council needs to have a serious discussion about assessing for roadway improvements. Staff has informed Council numerous times that the City does not have the money to fund the PMP. Councilmember Siakel stated Council cannot continue to entertain doing $1 million projects before they are scheduled to be done. She then stated she thought there is a balance between affording projects and priorities. CITY OF SHOREWOOD WORK SESSION MEETING MINUTES October 24, 2016 Page 5 of 7 Councilmember Labadie stated that not knowing how much the City would save by the City doing its project in conjunction with Minnetrista is a critical missing element. That needs to be factored into Council's decision. She then stated this Council wants to know hard financial numbers before it makes a decision. Mayor Zerby stated he thought the MCWD needs to get involved with this project; at least from a permitting perspective. He hoped that maybe it could be involved financially as well because it does impact lake water quality and that flows downstream. Director Brown stated staff has heard Council express competing priorities for the use of excess reserves. Some of them are improvements to the roadways on the Islands, addressing issues with the Southshore Center, and improvements to Badger Park. Understanding that Minnetrista has a process to follow before it decides if it is going to move forward with its project, he asked what Council would like the 2017 CIF to reflect. Councilmember Woodruff stated he would like it to reflect that the City is going to fund a potential reclamation or mill and overlay project on the Islands until it is proven that would not make sense from a financial and logical standpoint. He reiterated the current road conditions are rated at a level that indicates some improvements should be made to them. The schedule to make those improvements in 2023/2024 reflects what people thought a few years ago. He stated when more is known about what Minnetrista is going to do Council can decide whether or not to change the CIP. Councilmember Siakel stated doing that project in 2017 would require use of all the excess reserves thereby eliminating funding for other things Council has discussed. Councilmember Woodruff stated from his vantage point that may or may not be the case because the source of the funds could be a number of things. Councilmember Woodruff stated if staff is directed not to pursue this, and if Minnetrista moves forward with its project in 2017, the City will not have the opportunity to realize the savings of doing the project in conjunction with Minnetrista. He wants the 2017 CIP to reflect that the roadways on the Islands will be improved. Councilmember Siakel stated Council has never received any information about improving the section of Enchanted Lane just over the bridge that was flooded and damaged. Councilmember Woodruff noted Councilmember Siakel's comment is right. But, what she is asking for would be done as part of a feasibility study. Council has not been asked to approve a feasibility study yet. He clarified that he was not suggesting Council do that until it knows what Minnetrista is going to do. He stated he does not want the City to spend an approximate $10,000 to do a feasibility report until Council is relatively sure that it would want to move forward with the project. He thought that leaving Shorewood's project in its CIP would be appropriate while Minnetrista progresses through its process. Director DeJong asked if it would be possible for Council to extend this work session to allow for an opportunity to discuss the Strawberry Lane /West 62" d Street project. There was Council consensus to do that. Director DeJong explained the City is attempting to coordinate the Strawberry Lane /West 62 °d Street project with the Minnetonka School District if the District is willing to participate in an abatement process associated with the Minnetonka Country Club (MCC) redevelopment project to partially fund the CITY OF SHOREWOOD WORK SESSION MEETING MINUTES October 24, 2016 Page 6 of 7 project. There would be significant benefits to the District if the project moves forward because it would include constructing a sidewalk /trail that would extend down a fairly busy route to Minnewashta Elementary School. It would provide students with a safe way to walk to school. They currently have to walk in the driving lanes of those roadways. The project would be quite extensive and expensive. The sidewalk/trail portion of the project alone would be quite expensive. It would be less expensive if it was done in conjunction with the roadway reconstruction project which would also include stormwater management improvements. It does not make sense to construct the sidewalk as a standalone project and then do a street project two years later. Originally Strawberry Lane was scheduled for reconstruction in the 2019 in the CIP. During the budgeting process last year it was moved forward to 2017. The financing source for the street and trail project is not known at this time. DeJong noted that he thought it would be appropriate to move that project out to 2018 or even back to 2019 (its original schedule). Councilmember Siakel asked if doing that would free up money to spend on the roadways on the Islands. Director DeJong responded potentially. Councilmember Labadie stated if the City does that she asked if there a potential risk of losing the support of the School District and the potential financial support from the District via abatement. She then asked when staff last met with either a School Board representative or Superintendent Dennis Peterson. She noted that she, Mayor Zerby and Administrator Joynes met with Superintendent Peterson a long time ago. She asked what has transpired since that meeting. Director DeJong stated he is not sure but he does not think there has been any significant discussion since then. Labadie again asked if there is a risk to the City of losing the District's support via the abatement process. Director DeJong explained that in financing with tax abatement there has to be a significant added value in the property being abated. At this time that is not the case with the MCC site; it is basically raw land value. There is nothing to abate until there are buildings constructed on that site and that value goes on to the property tax rolls. There is almost a two -year lag time between when something gets constructed and when it ends up on the tax rolls. Delaying the Strawberry Lane /West 62" d Street project until 2018 would not negatively impact the City's financing opportunities. He thought it would be more appropriate to have houses constructed on the site showing that there is some value to abate. Mayor Zerby stated he would support pushing the Strawberry Lane /West 62" d Street project out to 2018. That time is needed to work with the School District and to have the project mature a little more. Councilmember Siakel concurred. Councilmember Sundberg stated she would like staff to find out how many students are walking on Strawberry Lane to get to the School. Councilmember Labadie stated it would not be possible to get a reasonably accurate number because many parents who live along or access Strawberry Lane to get to School do not let their children walk on Strawberry Lane to school. Sundberg clarified she would like to know those who have the potential to do that. Sundberg asked how much deterioration was caused to West 62nd Street because of the construction of the new development in the City of Chanhassen. Director Brown stated that roadway was in bad shape before the construction. She asked if there was any avenue to get financial participation from CITY OF SHOREWOOD WORK SESSION MEETING MINUTES October 24, 2016 Page 7 of 7 Chanhassen. Brown stated that because the road is in both Cities it would be appropriate to ask the question. Mayor Zerby stated he thought the question should be asked and explained that in the City's development agreements that if a contractor damages a roadway they are responsible for restoring it to the condition it was in prior to a construction project. Zerby commented that a park and a roadway are two different subjects. Councilmember Woodruff concurred with Zerby's perspective. Woodruff stated the City has had good success working with the City of Minnetonka on the Vine Hill Road where one half is located in Shorewood and the other half in Minnetonka. He then stated Chanhassen should stand up for the half of West 62nd Street it owns. It needs to be clearly conveyed to Chanhassen representatives that Chanhassen has a responsibility for that road as well. Director DeJong stated based on this discussion staff will leave roadways on the Islands in the 2017 CIP noting nothing will be done until Minnetrista has decided what it is going to do and until Council has further discussion about this. Staff will also move the Strawberry Lane /West 62nd Street project out to 2018 and attempt to coordinate the effort with the Minnetonka School District and Chanhassen. Councilmember Siakel stated she wants to have staff provide Council with the financial impact of doing those two things. She asked that Council be provided with the information about the various 2017 budgets well in advance of the next Council meeting. Councilmember Woodruff stated he expects staff to provide Council with a revised CIP and a complete budget packet. Director DeJong stated he will have that for Council's November 28 work session. He reviewed the time line for the Truth in Taxation meeting and timetable for final approval of the General Fund Budget, CIP and Enterprise Budgets. 3. ADJOURN Sundberg moved, Woodruff seconded, Adjourning the City Council Work Session of October 24, 2016, at 7:10 P.M. Motion passed 5/0. RESPECTFULLY SUBMITTED, Christine Freeman, Recorder Sc. erby, ayo ATTEST: Jean Panchyshyn, City Cler