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02-24-17 CC Retreat MinutesCITY OF SHOREWOOD CITY COUNCIL /STAFF RETREAT MONDAY, FEBRUARY 24, 2017 MINUTES Convene City Council/Staff Retreat Mayor Zerby called the meeting to order at 12:07 PM. 24150 SMITHTOWN RD SOUTH LAKE PUBLIC SAFETY FACILITY TRAINING ROOM Noon Present: Mayor Zerby; Councilmembers Johnson, Labadie, Siakel (by phone from about 1:25 P.M. to about 2:15), Sundberg, City Attorney Keane; City Administrator Lerud; Finance Director DeJong; Planning Director Nielsen; Director of Public Works Brown; City Engineer Hornby; Park and Recreation Coordinator Grout (departed at 12:55 P.M.); and, Communications Coordinator Moore (arrived about 1:30 P.M.) Absent: None Sundberg moved, Labadie seconded, approving the agenda as presented. Motion passed 4/0. 1. SOUTHSHORE CENTER Administrator Lerud noted the City became the sole owner of the Southshore Community Center (SSC) late last year. The meeting packet contains a memorandum providing some background information, usage data, some budget information and rental rates for the Center. He noted that Park and Recreation Coordinator Grout was present to help answer any questions Council may have. Coordinator Grout explained the rental numbers do not include the Southshore Senior Programming (SSSP) programs or kitchen rentals. She highlighted some of the programs that were offered in 2016 including those offered by SSSP. The Dementia Caregivers Support Group meets once a month. The Three Rivers Park District (TRPD) hosts a couple of programs at the SSC during the year. With regard to rentals, there is church that rents the Center on Sundays. Senior Alcoholics Anonymous rents on Sunday evenings. KICKS rents the Center twice a week. People rent the Center to have birthday parties and Christmas parties. There were three wedding receptions in 2016. Kitchen rentals are quite popular. Mayor Zerby asked what the typical attendance is for the SSSP programs. Coordinator Grout estimated the total attendance is about 60 people and about 20 per program. Councilmember Sundberg asked where attendees come from. Coordinator Grout stated largely from the surrounding area. But some come from the Cities of St. Louis Park, Mound, Chanhassen and Chaska. Mayor Zerby asked if SSSP still provides volunteers to work at the front desk. Coordinator Grout responded yes and noted SSSP pays the City about $600 monthly to use the facility during the day on weekdays Councilmember Johnson asked if there has been an increase in seniors' usage because of the new senior living facilities. Coordinator Grout stated there has not been. Johnson asked if the Oppidan facility and City Council/Staff Retreat Minutes February 24, 2017 Page 2 of 14 The Waters of Excelsior facility will have their own program facilities or would the residents living there use the Center. Mayor Zerby stated he thought there are two classes of seniors; the old seniors and the new seniors. The old seniors did like to get together for dining and programs. The new seniors (Baby boomers) do not want get together with the old seniors and they want to remain active. The new seniors have more circles of friends. He does not think the usage will increase because of the new senior facilities that are being built. Councilmember Labadie suggested meeting with activity directors at the new senior facilities to find out if there is a way to come up with some new programs geared specifically for seniors. Councilmember Sundberg stated the TED talks have been well attended by various age groups. Administrator Lerud noted the City has subsidized the Center in the amount of about $70,000 annually. He stated he does not anticipate that the Center will ever be self - supporting. Councilmember Sundberg stated that based on her research community centers are not. Councilmember Labadie stated she thought young families and children are overlooked when it comes to the Center. Most people think the Center is primarily for seniors. She thought if there were programs targeted for families and children they may draw a different group of people. Mayor Zerby noted that some people still refer to the SSC as a senior center. There are also people who don't want to hang out at a senior center. Administrator Lerud highlighted the pros and cons of selling the Center. ➢ Pros • The City would not have to subsidize the Center's operations. • The tax exempt property could be put on the tax rolls. • The appraised value for insurance purposes is $1.2 million. Selling it could provide funds for other purposes. • Funds would not have to be spent on immediate improvements to the Center. • Could a private entity run it more efficiently? ➢ Cons • If it were marketed and operated properly it could be an asset to the City. • It could be politically unpopular to sell it. • Access and parking issues for the use of City property would have to be worked out. • The City would have little or no control over the schedule or fees. • There would be a loss of the SSSP revenue of $600 per month and seven hours per day of staffing. The City could operate the Center independently or with a partner. Some outside assistance would be needed to help evaluate that upfront or on an ongoing basis. The outside assistance could be as an executive director or a service hired to perform specified functions. The pros and cons of operating the Center independently are as follows. ➢ Pros City Council /Staff Retreat Minutes February 24, 2017 Page 3 of 14 • The City would have 100 percent control of the Center. • The City could be very responsive to the community wants and needs for the use of the facility. ➢ Cons • The City assumes 100 percent of the risk and expense. • There is a need for $75,000 in improvements that are largely cosmetic to the Center. • There would be higher personnel costs. • If the facility fails to attract new business the City would have to continue to subsidize the operations for about $70,000 annually. Mayor Zerby explained an option for rebranding — The Woods Community and Event Center. The comment that the Center is nestled in the woods comes up frequently. He created the logo on an internet site. It has waves under the words "The Woods ". He expressed his desire to rename the Center and freshen it up and market it as an event center and a community center. Councilmember Labadie suggested opening up the rebranding as a contest. She asked if the City has approached Minnetonka Community Education (MCE) Executive Director Tim Litfin about using the Center for MCE programs. Mayor Zerby explained Director Litfin views the Center as a competitor because the Center started to offer general education programs. MCE had been asked to operate the Center once but MCE thought the Center was not large enough. Councilmember Sundberg noted she does not consider selling the Center an option. It is a valuable asset to the City and the City would not be able to sell it for close to $1.2 million. She thought it was the City's responsibility to keep it operating. Sundberg stated she likes Mayor Zerby's rebranding option. She also liked Councilmember Labadie's suggestion to engage the community. Mayor Zerby stated he would like to expand the usage of the Center and hire a professional director to run it. He commented that he had thought about putting a cafe outside of the Center and connecting it to Badger Park. He commented he was inspired when he went to the curling rink and community center in Chaska. It is a destination spot for people to hang out at. The curling rink is operated in partnership with a food and beverage establishment. He would like the Center to be a destination spot and tie it to the Park. He mentioned a number of ideas. Councilmember Sundberg stated she would like the Center and the Park to be more integrated. She noted she thought there is a need for professional input. Administrator Lerud stated there are consultants who could help the City do a market analysis and who could take the Council's vision and determine if the facility could provide what is needed. Mayor Zerby stated he thought a business plan is what is needed. The City could send out a request for proposals (RFP) from an operator. Lerud asked if that means they would be in the driver's seat instead of the City. It would be up to Council to decide if what is recommended satisfies Council's desires. Mayor Zerby noted that he was not interested in making it a for profit center. The goal is to make the highest and best use of the land and the facility. He thought there should be an RFP for an operator /director position. Councilmember Sundberg noted she wanted to keep it broader than that; she wanted a pure consultant to develop a business approach. Zerby noted that had been done in the past for the City. City Council /Staff Retreat Minutes February 24, 2017 Page 4 of 14 Attorney Keane stated a capital expenditure analysis for the Center had been done a few years ago. He asked if Council wants to create a fund for future capital needs such as roof replacement and heating/ventilation /air conditioning improvements. Those needs will have to be addressed in the next 5 — 7 years. Councilmember Sundberg stated there may be grants that the City could apply for. The county has environmental grants it gives to communities. Councilmember Labadie stated she likes the idea of soliciting RFPs from individuals or companies. She is not sure she wants an operator but she would like to hear their perspectives and to find out what it would cost for their services. She thought turning over operations could potentially be expensive. Councilmember Johnson asked if the public should be told that the City is going to solicit RFPs before it does so. Councilmember Sundberg asked if it is time to do a resident survey and solicit input on this issue and others. Councilmember Johnson stated the information from a survey could be included in the RFP. Mayor Zerby stated the City has done surveys in the past. The correct wording of questions can be a challenge sometimes. Councilmember Sundberg stated she thought the last survey was very helpful. From it she learned that Shorewood residents appeared to be interested in environmental issues. Mayor Zerby expressed he was growing impatient because nothing has been done with the Center. Waiting to do a survey will push things out another year. Councilmember Labadie stated she thought a survey could be done at the same time the City seeks RFPs. She does not want the survey to be just yes /no questions or select a/b. Mayor Zerby stated the City has to be prepared to address the answers from a survey. If residents are asked about what other senior programs it would like to have offered the City has to be prepared to offer them. Currently SSSP offers most of the programming so it would have to be part of the discussion. Councilmember Johnson stated it's been a long time since the City has done anything to the Center. He then stated he thought the residents would like to see increased use of the Center in order to justify its existence. He expressed concern about the ability to get to the Center on foot; there is not a good way to get across Country Club Road. He would like to have a connection from the Smithtown Road trail. He expressed his support for holding off on doing a survey until after the City has done a preliminary RFI (request for information) as opposed to an RFP. Depending on the results of the RFI the City could then decide if it wants to do a survey. Councilmember Sundberg noted she does not think doing a survey should slow the process down. Councilmember Labadie concurred. Sundberg stated she supports offering residents the opportunity to get involved even though most do not want to get involved. City Council /Staff Retreat Minutes February 24, 2017 Page 5 of 14 Councilmember Johnson stated he likes the idea of doing an RFI or RFP at the same time as having a public rebranding contest. He then stated a rebranding is only as good as the full plan behind it. There was ensuing discussion about rebranding the Center and about how to get residents involved in a rebranding contest. Mayor Zerby displayed and explained a rebranding graphic he created. He also highlighted some of the improvements (lighting, replacement of ceiling tiles, and lobby enhancements) that need to be made to the Center base on what Council saw when it toured the Center on February 13, 2017; improvements that would not be tied to the rebranding. Park and Recreation Coordinator Grout departed the retreat at 12:55 P.M. 2. STREET CAPITAL IMPROVEMENT PROGRAM AND PASER EVALUATION Director Brown explained each fall after the vast majority of patching has been done and sealcoating is complete he and some Public Works personnel go out and rate roadways based on the PASER (Pavement Surface Evaluation and Rating) System rating of 1 to 10, noting the System was developed by engineers at the University of Wisconsin. He displayed a graphic which showed it costs less to regularly maintain roadways then it does to let them seriously deteriorate and then resolve the issues. The City's goal is to maintain its investment in its roadways, minimize the issues of liability again while providing roadway surface conditions that drivers find acceptable. Historically the City has tried to keep its roadways at a level 4 or higher. The meeting packet contains a copy of a list of 2016 pavement ratings and recommended action for each of the City's roadways. There are 12 roadways that have a PASER rating less than 4. He noted that one —fifth of the City's roadways are sealcoated each year. An attempt is made to do that in groups of roadways to minimize the impact on residents. He explained seal coating involves applying oil and rock to roadways; it helps to maintain the life of the pavement. Bituminous overlay involves grinding down the edge of the pavement in order to match driveways and then placing a new 1.5 — 2 inch asphalt surface down. Reclaiming a roadway has become quite popular over the last 15 years. It involves grinding up the existing asphalt and the rock below it, mixing it up to make a new stronger rock base, putting that new mixture down and packing it down, and then putting a new asphalt surface over it. There must be a good underlying foundation soils in order to do reclamation. If the foundation soils are poor it a may necessitate reconstruction. The standards for roadways have evolved over the years. The soils under roadways constructed in the 1970s when sanitary sewer was installed are likely poorer than those under roadways constructed in the 1980s and later because they are likely on two feet of sand. He estimated that about 60 percent of the roadways are on poor soils. Mayor Zerby asked if roadways can be constructed to different standards at different price points. Director Brown stated the choices are limited from a financial perspective. Some cities would consider having 2 feet of soil under the pavement structure, which the City has in some places, as extravagant. That soil base has more to do with frost than with traffic volume. Engineer Hornby stated that communities that have frost susceptible soils require a 2 -foot soil base. Zerby stated the City has heard from residents in the past that they thought the 1980s standards were fine. They question why their roadways need to be torn up. Director Brown state people living in the western part of Shorewood west of Marsh Point questioned the need for curb and gutter. As the demographics change so does that perspective. City Council/Staff Retreat Minutes February 24, 2017 Page 6 of 14 Director Brown explained the City implemented the use of a Pavement Restoration Flowchart a number of years ago to guide the management of the City's pavement inventory. If a roadway is rated a 4 or higher it is maintained through periodic maintenance (i.e.; sealcoating and overlays). He highlighted the decision points in the Flowchart. Mayor Zerby suggested giving residents a 2 — 3 years of advance warning of when the roadways in their neighborhood would be improved. Engineer Hornby explained there were five roadways slated for the 2017 Mill and Overlay Project. Staff decided to have coring samples taken of those pavements prior to performing the design for the mill and overlay. The 15 samples provided a good indication of the condition of the pavements. Unfortunately, the samples indicated that the pavement had deteriorated to a point where a mill and overlay would not be appropriate. The pavement management specialist indicated the pavement would just come apart if it was milled. Overlaying the pavement would be a temporary fix because in 3 — 7 years the roadways would be in the same condition as they currently are. The roadway surfaces could be reclaimed to give the pavements another lifecycle. The specialist suggested all 5 roadways be reclaimed. Reclamation costs more than a mill and overlay but not as much as reconstruction. Director Brown noted that the coring technology is relatively new. Staff has decided to take core samples for those roadways included in the Capital Improvement Program (CIP) for the next five years. Councilmember Sundberg asked when Eureka Road North is scheduled for improvement. Director DeJong stated it is scheduled for a mill and overlay in 2019. Director Brown anticipates that it would have to be reclaimed because at the low point in the roadway there is a wetland on both sides of the roadway. There is a culvert that is basically an equalization pipe. The flow of it is governed by the low point in Lake Minnetonka near Crescent Beach. Until the Lake level drops the roadway may flood. Engineer Hornby noted that a lot of the sanitary sewer line was put in in 1969 — 1972 in the main part of the City. The life of those roadways constructed when the line was put in is approaching 50 years. Mayor Zerby noted that the PASER ratings for 4 of the 5 2017 roadways are higher than 4. He asked why the coring process was implemented for 2017. Director Brown clarified that the PASER System is a surface rating system. He stated the City has done a good job maintaining roadway surfaces; the ratings are accurate. The coring process allows the City to gain a better understanding of what lies below the surface. He then stated that staff intends to incorporate the coring technique into the prediction system. Director Brown explained that the creators of the PASER System believed that once a roadway is sealcoated the rating should be brought up to a 10 (the rating for new pavement). Staff has instead chosen to bring it up to a 7. Councilmember Siakel joined the discussion by phone at about 1:25 P.M. Councilmember Sundberg asked why the improvements to Eureka Road North are not a higher priority. Engineer Hornby clarified the PASER System does not take flooding into account. Sundberg stated repeated flooding should be factored in to prioritizing improvements. The same is true for traffic volume. Director Brown stated volume is indirectly accounted for in the rating system. Hornby explained Eureka Road North had been classified as a Minnesota State Aid (MSA) roadway at one time. After deciding that it would not be reconstructed to MSA standards the classification was changed. He then stated that the type of vehicles more than the volume of vehicles impact a roadway surface. City Council /Staff Retreat Minutes February 24, 2017 Page 7 of 14 There was ensuing discussion about how to make the Flowchart more accurate and to include a step for taking and evaluating core samples for roadways scheduled to be overlaid. Engineer Hornby noted that the pavement specialists decide where to take core samples from. He does that so he does not influence their thoughts. Director Brown stated they take random samples. Hornby explained samples are taken every 300 — 500 feet. Councilmember Labadie asked why some roadways that are rated quite poorly are not in the 2017 CIP. Director Brown explained that for many of them there was resident pushback. That happened for Star Lane and Star Circle as well as well as for Valleywood Lane and Sunnyvale Lane. Director Brown explained that maintaining roadways is more cost effective than doing the worst roadways fist. When a roadway deteriorates to a certain point it makes more sense to let them deteriorate further before reconstructing them. Councilmember Labadie asked at what point resident pushback overrides the City's policy. She also asked when Council gets to set the priorities. Director Brown responded during CIP discussions. Mayor Zerby stated he has heard from some residents along Amlee Road that they would like their roadway repaired. When it was last scheduled for repairs residents pushed back on the proposed work. He asked when they it is scheduled to be reconsidered. Councilmember Sundberg stated if there is resident resistance to improve a neighborhood roadway she thought the City should acknowledge that resistance and not improve the road. But, if a roadway is used more broadly then the local resident resistance should not be the deciding factor. Director Brown stated staff bases its recommendations on technical analysis. It is up to Council if it wants to defer roadway improvements. Engineer Hornby explained there have been some projects where there were difficult public information meetings. Mayor Zerby stated doing the coring in advance will give the City an opportunity to provide residents with additional justification for why it needs to make improvements to roadways. Engineer Hornby noted that coring samples would be taken 3 — 5 years before a roadway is slated for a mill and overlay. Director Brown stated the current policy is if a roadway's rating drops below 4 the City will consider serious improvements. A rating of 4 may not be the right trigger point. Councilmember Siakel stated she does like to have technical data to help guide decision making. She noted supports continuing to use the PASER rating system and using the Pavement Restoration Flowchart to guide decision making about pavement management. She stated the City has deviated from doing that in the past. In the past some property owners have resisted roadway improvements because watermain would have been installed and assessed. She suggested guidelines be put in place to help guide the decision making process regarding deviations. Councilmember Labadie asked if staff anticipates that most of the higher rated roadways will end up with a lower rating once core samples are taken and evaluated. Director Brown responded yes. Engineer Hornby stated that is in large part because the roadways were constructed when the sewer went in in the City Council/Staff Retreat Minutes February 24, 2017 Page 8 of 14 late 1960s and early 1970s. Labadie asked if the 5 roadways in the original 2017 CIP constructed about that time. Brown responded yes. Director DeJong noted that core samples were also taken for the roadways out on the Islands and the results indicate a mill and overlay of them would not be adequate. He explained if the original 5 roadways in the 2017 CIP and the Island roadways were to be reclaimed in 2017 it would increase the cost by $750,000 over the approved 2017 Street Reconstruction CIP. Of that increase amount $475,000 would be for the 5 roadways in the original CIP and $275,000 for the roadways on the Islands. The 2018 CIP includes two reconstructions and one mill and overlay. The 2019 CIP includes six mill and overlays. The 2020 CIP includes four mill and overlays. The 2021 CIP includes three reconstructions (Glen Road East, Amlee Road and Manitou Lane) and three mill and overlays. The 2022 CIP includes five mill and overlays. The 2023 CIP includes one reconstruction and one mill and overlay. The Island roadways were originally scheduled for mill and overlay in 2024. There will be an anticipated $2.3 million shortfall (in present day dollars) in the Street Reconstruction Fund by 2024. Councilmember Johnson asked what the cost for taking core samples is. Engineer Hornby stated it was about $1,500 for Howards Point Road, Councilmember Labadie asked why Shady Island Trail went to reclamation from a reconstruction. Engineer Hornby stated because of the water table on the Islands a reconstruction would not be the best thing to do. Engineer Hornby explained that once the core samples came back for the 2017 roadway projects he stopped the mill and overlay project for 2017 until Council decides what it wants to do. He asked if Council wants to adhere to improving the roadways in the years they were slated in the original Street Reconstruction CIP or does it want to advance the Island roadways to 2017. Councilmember Sundberg suggested delaying answering that question after there have been future budget discussions. Director Nielsen asked what the cost savings would be by doing the Island roadways at the same time the City of Minnetrista makes improvements to its portion of Enchanted Lane. Engineer Hornby stated he does not know the exact amount. He explained there would be some savings on indirect costs because there would be one plan and one spec. When volume (material, labor, and equipment) is added to a project the cost comes down. When everything is factored in the savings would be about 10 percent on the construction costs (or about $75,000). Councilmember Johnson stated there would also be a reduced burden on the residents because they would only have to endure the impact of roadway work one time. Engineer Hornby noted the City has not held informational meetings on the Island roadway improvements yet. Mayor Zerby recessed the meeting at 2:12 P.M. The connection with Councilmember Siakel was lost some time during the break Mayor Zerby reconvened the meeting at 2:30 P.M. Engineer Hornby explained the meeting packet contains a copy of a memorandum from him and one from Chuck Rickart, a traffic engineer with WSB & Associates and the facilitator of the Traffic Committee, regarding potential traffic improvements to the Country Club Road, Yellowstone Tail and Lake Linden Drive corridor. Mr. Rickart's memo provided a brief summary of each potential improvement, a range of costs to make the improvement, and advantages and disadvantages for each. Council discussed the City Council /Staff Retreat Minutes February 24, 2017 Page 9 of 14 documents during its February 13, 2017, meeting. He clarified the engineers did not do anything other than listen to Committee members and put their concepts on paper. He stated there are some lower cost items that could be incorporated into the CIP. In response to a comment from Mayor Zerby, Engineer Hornby explained the City could do a traffic destination study. That would involve trying an application on a temporary basis to see what the impact would be on traffic patterns. For example, there was discussion about trying to discourage the use of the left hand turn out of the CUB Foods parking lot on the east. The Committee had discussed if its goal was to accommodate the current traffic on Country Club Road or did it want the traffic to be redirected. The impact of redirecting traffic could be studied by prohibiting a left hand turn off of Smithtown Road onto Country Club Road by putting a barrier there. During its last few meetings it was clear the Committee wanted more enforcement along the corridor to try and reduce bad habits. That was the number one thing the Committee wanted done along that corridor. There were varying views about improving the corridor to accommodate traffic; some members wanted that and others did not. Councilmember Sundberg stated Council would have to decide it wants to meet the needs of those immediately impacted or the greater population. Engineer Hornby stated staff discussed the problems staff would have getting to City Hall if a southbound access to Country Club Road was closed off. Councilmember Sundberg suggested it would make sense to hold off on making any changes to Country Club Road until the Minnetonka Country Club (MCC) development project is done. Engineer Hornby noted that he has not observed heavy construction vehicles traveling on the corridor to the project site. Mayor Zerby stated there are two issues; one is reducing the traffic volume and the other is safety. He noted he like the idea of testing various ideas by doing a traffic destination study. He suggested tightening up the corners along the corridor on a temporary basis with the use of temporary vertical pylons or some other device. Councilmember Sundberg questioned the viability of having a roundabout at the north end of Country Club Road at Smithtown Road because the location is tight. Engineer Hornby stated he does not think a roundabout would work because drivers would stack up in the roundabout. He explained there could be a tied signal installed that would control Country Club Road and Smithtown Road traffic and have it synchronized with the light on Country Road 19 at Smithtown Road. Councilmember Sundberg agreed with Engineer Hornby that the low budget items could be done noting some of them could be quite impactful from a safety perspective. She stated during the CIP discussion she suggested the Country Club Road improvements be prioritized along with other projects. Engineer Hornby stated roundabouts can be very helpful when used in the right place and under the right conditions. Councilmember Johnson noted that MnDOT's signage for using roundabouts is not very clear. Councilmember Labadie noted the Smithtown Road / Country Club Road / Country Road 19 intersection is substandard. She asked if any of the improvement estimates include the cost of land acquisition. Engineer Hornby responded no. City Council /Staff Retreat Minutes February 24, 2017 Page 10 of 14 Engineer Hornby noted he thought Smithtown Road could be reconfigured in order to accommodate two eastbound lanes when approaching the intersection with Country Road 19. That may not be needed if there was a coordinated signal at Smithtown Road and County Road 19. Councilmember Sundberg stated she was not convinced that limiting cut thru traffic along the corridor route should be the goal. Engineer Hornby explained the corridor is a public roadway. The City is providing a transportation network. That corridor should be modified to meet the traffic need. Director Brown agreed that the City has a responsibility to provide a traffic network and to accommodate that route. She suggested her preference to shift priorities for roadway improvements and focus on the corridor route because of the current traffic volume and the projected increase. Mayor Zerby stated the City's challenge for its roadways is load balancing. If the City makes it too difficult to go south on Country Club Road drivers will so south on Minnetonka drive. He clarified there are issues along that corridor route. Director Nielsen stated the Comprehensive Plan includes a Transportation Plan that states there needs to be a way to get from a local street to a collector roadway and from a collector to an arterial roadway. They must be spaced according to standards. He cautioned Council and staff against using the phrase cut thru. Engineer Hornby asked Council how it would like him to move this forward. Councilmember Sundberg asked when Council is going to revisit the Street Reconstruction CIP again. Hornby noted that he and Director Brown have discussed whether or not the City should use a different rating system for roadways. Sundberg stated she did not think that is needed. But, she does think there is a need to factor in other things. Mayor Zerby stated he thought now would be a good time to do a traffic destination study. He then stated Council needs to figure out how to fund all of the proposed street improvement projects. Councilmember Sundberg concurred. Engineer Hornby stated most roadways are designed to state standards for vertical and horizontal curves and speeds. He then stated Country Club Road has a lot of character and challenges to overcome. Councilmember Sundberg suggested taking roundabouts off of the table. Councilmember Johnson asked if there is a way to test the effectiveness of a synchronized signal light at the intersection of Country Club Road and Smithtown Road. Engineer Hornby stated a temporary signal could be set up. Director Brown stated staff could solicit a proposal for doing that. Johnson stated he would like that to be added to the list of temporary things to do. If that works then roundabouts could be taken off of the table. Councilmember Labadie asked if a temporary signal is enforceable. Hornby stated once it is in it is a traffic control issue. Engineer Hornby stated staff will work out the details for a temporary signal. 3. ASSESSMENTS / FRANCHISE FEES Administrator Lerud stated there is already a $2.3 million dollar shortfall in funding for existing projects. That does not include potential increased cost based on the findings from core samples or implementing some of the recommendations made by the Traffic Committee. There are a few of options for funding. One is increasing the property tax. Another is assessments. A third is franchise fees. City Council/Staff Retreat Minutes February 24, 2017 Page 11 of 14 Director DeJong explained a chart for 2017 — 2024 which showed the cost for street reconstruction projects and what the City could collect in assessments for 20 percent, 30 percent, 40 percent, and 50 percent of the reconstruction costs for that time period. Assessments would be a significant change from the way things are now. The assessments could be paid off over time. He noted that the transfer into the Street Reconstruction Fund increases by $15,000 each year. The 2017 transfer in amount is $770,000. In 2024 the transfer in amount is $875,000. That still results in a funding gap. To close that gap would require a significant increase in the transfer in amount. Administrator Lerud stated another potential funding source could be franchise fees. The money would come from the residents. The City does not currently have a franchise agreement with either Xcel Energy or CenterPoint Energy. Pros of franchise fees ➢ Fees are collected from properties that do not pay taxes but use the streets. ➢ Similar properties pay the same amount regardless of value. ➢ Allows customers to pay monthly rather than twice a year. ➢ The franchise fee would go toward streets. Cons of franchise fees ➢ The fees may be viewed as a hidden tax. ➢ Franchise fees are collected by a utility company. There are currently 3,145 Xcel Energy connections in Shorewood and 93 percent of them are residential. For illustration purposes, a $1 per month meter charge would generate $37,608 annually. There are currently 2,866 CenterPoint Energy connections in Shorewood with the vast majority being residential. For illustration purposes, a $1 per month meter charge would generate about $34,400 annually. If the per - month charge were $3.00 for each utility that would generate about $220,000 annually. He noted there was legislation introduced into the House that would require a referendum vote in the community to implement a franchise fee. Councilmember Sundberg she likes the idea because it would spread the burden. Administrator Lerud noted the City already contributes about $800,000 in taxes through transfers. Councilmember Sundberg stated if the City moved forward with a fee she asked that it be very transparent. She then stated she would hate to impose significant assessments on properties in order to do some of the upcoming roadway improvement projects. Attorney Keane stated the purpose of the franchise fee is to avoid hefty assessments. Communications Coordinator Moore noted the City had a $1 franchise fee at one time but she does not remember what it was for. Mayor Zerby asked how long it would take to implement a franchise fee. City Council /Staff Retreat Minutes February 24, 2017 Page 12 of 14 Administrator Lerud explained the first thing that has to be worked out is the franchise agreement with the utility companies. Attorney Keane stated that the City is currently operating outside of its franchise agreement with Xcel Energy. That needs to be revived. In response to a question from Councilmember Labadie, Administrator Lerud explained the amount of the franchise fee can be set for each type of connection. He reiterated that 93 percent of the connections in Shorewood are residential for Xcel Energy. The fee for within each connection category would have to be the same for the same types of service. Fees could be different for different types of meter connections. Mayor Zerby stated if the fee were to be $5 per utility per meter the City could collect about $360,000 annually. He thought collecting a fee to help pay for roadway improvements would be more fair than assessments. There was Council consensus to move forward with franchise agreements Director Brown clarified that when a fee is established by a city the utility company makes that very clear on the utility bill. Councilmember Johnson noted that the Cities of Deephaven, Excelsior and Minnetonka have a $2.50 franchise fee per residential connection. 4. ORGANIZED WASTE HAULING Administrator Lerud stated he has heard from more than one member of Council that they would like to consider organized waste hauling. The meeting packet contained background information about that. He said there is a question of if it has to be all or nothing or can it be a hybrid. Attorney Keane explained the City could take a hybrid approach, the entire City could be organized or the City could be organized by area. One city he knows of took the licensed haulers and the percent of the community they each served and tried to approximate for a post organized situation assigning them an area that would contain approximately the same number of residential customers each had before converting to organized hauling. Every customer in a hauler's assigned area would use the same hauler. State Statute requires there be a study period. He suggested Council discuss options for and benefits of organized hauling in a work session. Mayor Zerby stated he would prefer there to be fewer haulers. The City currently has five licensed haulers. He asked, for example, if there would be a way to reduce the number to three. Director Nielsen explained that years ago the City did that type of study and one of the recommendations that came out of the study was to divide the City into quadrants and let each of the various haulers bid on providing service to one or more quadrants. Administrator Lerud stated the City could require a hauler to have a minimum number of customers. Councilmember Sundberg asked if there is any sense for how residents feel. She explained she went to a League of Minnesota (LMC) meeting a few years ago and she was amazed at how many people in attendance were committed to being able to select their hauler. Attorney Keane stated he thought that was a surrogate for anti - government. Sundberg stated the City has an obligation to look into reducing the City Council /Staff Retreat Minutes February 24, 2017 Page 13 of 14 number of haulers because of the wear and tear they contribute on the City's roadways. Councilmember Labadie state all five haulers pick up along the roadway in her neighborhood. Mayor Zerby stated he tried to get organized hauling in his neighborhood but to no avail. He thought it would be a good first step to reduce the number of haulers to three. Councilmember Labadie departed the meeting at 3:30 P.M. There was consensus to have a work session to discuss at a minimum reducing the number of haulers. Councilmember Johnson stated that during the work session he would like to discuss the pros and cons of organized hauling and open hauling. Communications Coordinator Moore explained that she called some of the cities that recently considered converting to organized hauling and learned that they were getting less pushback from the community than they had several years ago. Haulers hire lobbyists and groups to come out and try to convince residents that organized hauling was a bad idea. Council needs to be ready for that. She noted that some of the City's haulers are not against a zoned approach to organized hauling. Councilmember Sundberg stated she thought it would be difficult to organize survey questions around organized hauling. Communications Coordinator Moore stated Hennepin County can provide a lot of information that will help with the consideration of organized hauling. 5. RENEWABLE ENERGY Engineer Hornby stated the City's Renewable Energy Implementation Plan was updated to include items staff and Council had previously discussed and eliminate others. Items were broken out by year rather than just, for example, short-term. An introduction and definitions were also added. In 2017 there are more items included than in any other year. He noted that Councilmember Sundberg and Communications Coordinator Moore are working with Xcel Energy and on the Partners in Energy Program. The change out to LED lighting is in progress. There were a number of planning and zoning items that were discussed as part of the Minnetonka Country Club (MCC) project. An energy efficiency audit will be done by Xcel Energy to determine what is and is not working well. For 2018 — 2020 there are items included to make modifications to the City -owned buildings to improve energy efficiencies but costs are not included. Most of the items listed in the Plan require staff time only. Councilmember Sundberg stated she supports all of the items included in the Plan as well as the timeline. Engineer Hornby explained that the consultant who put the Plan together had an item for fuel efficiency for larger fleet vehicles. That was removed from the Plan because there is not a supplier for them. He questioned if hybrid vehicles for smaller vehicles should be considered. On -site solar installation was pushed out because of cost. Councilmember Sundberg asked that the Green Step Cities Program should be refreshed in 2017. Communications Coordinator Moore stated she had provided Director Nielsen with items to add to the City's plan. Engineer Hornby stated staff can bring this Plan back to Council for formal adoption. City Council /Staff Retreat Minutes February 24, 2017 Page 14 of 14 Mayor Zerby stated he agrees with what has been presented. Councilmember Sundberg stated the Partners and Energy Program has just started. She noted she was unsure of where it would go. Communications Coordinator Moore stated the first meeting is scheduled for March. There are 15 participants who volunteered to be on the initial committee. The initial meeting is going to be about following the guidelines Xcel has worked on with other communities. Xcel already has a list of ideas for cities. Engineer Hornby stated people don't always relate low volume toilets or low volume shower heads to energy. Communications Coordinator Moore stated if the City has a plan it can apply for a grant that would allow it to offer additional rebates to residents who purchase Energy Star appliances, for example. Other Mayor Zerby provided Council on an email he just received from a Mattamy Home representative regarding it sale of all of its Minnesota assets including the Minnetonka Country Club site. In summary it was selling the bulk of its Minnesota assets to a combination of CalAtlantic and MI Homes. Employees at its Minnesota developments will be terminated between April 27 and December 31. None of the employees are represented by a union. He stated he wants assurances that any promises Mattamy made to the City will be transferred to the new owners. Attorney Keane clarified that CalAtlantic is Ryland Homes, a reputable builder in the Twin Cities market for a long time. Mayor Zerby noted Mattamy Homes owes the City $148,000. Councilmember Sundberg and Mayor Zerby thanked Administrator Lerud for his preparation for this retreat. 6. ADJOURN Johnson moved, Sundberg seconded, Adjourning the February 24, 2017, Council and Staff Retreat at 3:45 P.M. Motion passed 310. RESPECTFULLY SUBMITTED, Christine Freeman ATTEST: 7m� Greg Lerud,�Ciiy Administrator Scot erby, l ayor �L� CITY OF SHOREWOOD CITY COUNCIL RETREAT FRIDAY, FEBRUARY 24, 2017 AGENDA CONVENE RETREAT Roll Call Review Agenda SOUTHSHORE CENTER A. City Administrator Memo B. Attachments a. Usage Graphs b. Revenues and Expenditures c. Rental Fee Sheet 24100 SMITHTOWN ROAD PUBLIC SAFETY BLDG, EMERGENCY OPS. ROOM 12:00 P.M. Lunch available at -1-1:45 AM Mayor Zerby Johnson Labadie Siakel Sundberg 2. STREET CIP/PASER EVAULATION A. City Administrator Memo B. Public Works Director Memo C. City Engineer Memo D. Attachments a. Pavement Rating and Record of Action Spreadsheet b. Street Maintenance schedule E. City Engineer Memo — Traffic Committee F. CIP Spreadsheet ASSESSMENTS/FRANCHISE FEES A. City Administrator Memo re: Assessments B. Attachments a. Shorewood Assessment Policy Regarding Water Connections b. Outline of Shorewood Assessment Policy c. Finance Director Spreadsheet C. City Administrator Memo re: Franchise Fees D. Attachments a. League of MN Cities Information Memo b. Elk River Finds Its Way to Smoother Roads — Article in July /Aug 2016 MN Cities Magazine c. Xcel Energy Franchise Fee Printout CITY COUNCIL REGULAR MEETING AGENDA — FEBRUARY 9, 2009 Page 2 of 2 4. ORGANIZED WASTE HAULING A. City Administrator Memo B. Attachments a. League of MN Cities Memo b. MN Pollution Control Agency Info Sheet c. Excerpt from MN PCA Report d. Memorandum of Understanding example from Arden Hills 5. RENEWABLE ENERGY A. City Engineer Memo B. Attachments a. Shorewood Renewable Energy Implementation Plan 6. ADJOURN