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HomeMy WebLinkAbout12-15-2009 Council Work Session Minutes Orono City Council Committee of the Whole December 15, 2009, 6:15 p.m. Orono City Council Chambers Present: Mayor Jim White, Council Members Cynthia Bremer, Doug Franchot, Lili McMillan and Jim Murphy; Assistant City Administrator for Long-Term Strategy Mike Gaffron, Finance Director Ron Olson, Police Chief Correy Farniok, Public Works Supervisor Scott Oberaigner, City Clerk Lin Vee 1. Police Department Update • As of 1/8/10, Correy will be in Virginia until the end of March attending the FBI Academy. Scott Boris will be the go-to person, but if a substantial circumstance arises he will return. The Academy consists of 19 credits through the University of Virginia with a physical fitness component and daily classes from 8:00 am —5:30 pm. • Several Council action items will be brought to the January meeting including: o Purchase of squad cars—request to replace 2, third later if needed o Replacement of the 2001 Expedition—mileage is at 81,000 and there have been several recent repairs. Replacement will not be a primary patrol car. o Disposal of weapons—request will include trading 2 current patrol officer weapons and obtaining 4 more weapons for training. • Contract cities—Spring Park is happy with the draft contract. Mayor White commented that Correy should be credited for resolving issues. o Schiefer suggested a meeting with Terry Post at Long Lake to provide a copyof the draft contract and review the language. The contract is basically the same service as Spring Park, but everything related to a supplemental officer has been removed. Addendums are included that refer to cost allocation over the next 3 years. After 2012 all contracts will be consistent between Spring Park, Minnetonka Beach and Long Lake. Council discussed the potential reaction from Long Lake. Correy will meet with Terry Post and review the draft contract. After Long Lake has an opportunity to go through the contract, a meeting will be scheduled with Schiefer. o The new warning sirens will be operational in the Casco point area. o Wayzata will be losing one officer at the beginning of the year, and possibly another later in 2010. Correy has offered to share resources if there is an opportunity and will be meeting with other neighboring cities to discuss the potential to share resources. 2. Website Redevelopment Update • Rachel Dodge stated that the current website software is no longer supported and that the average website changes every 3-5 years. Council approved the purchase of GovOffice, a third party software, earlier in the year. • The IT committee and various staff inembers have been reviewing 4 design layouts proposed by GovOffice. Recommendations will be sent back to the GovOffice designer for revisions. • After a final design is selected, it will take 3-5 weeks for the developers to design a working website. During this time, staff can begin training and working on additional web pages. • Currently Rachel does all the updates. The new software is more user-friendly and can be updated by others. • The goal is to have the new website up and running by spring or early summer of 2010. • The use of Facebook and Twitter as an additional way to communicate with residents was briefly discussed. A policy would need to be adopted. Only information that is already being distributed would be included and there would be no opportunity for public feedback through Facebook or Twitter. Page 1 of 4 Orono City Council Committee of the Whole December 15, 2009, 6:15 p.m. Orono City Council Chambers • 4 designs were distributed and discussed. A fifth design comprised of layout pieces that the committee preferred was also distributed. • Council had positive comments about all of the designs and had no specific objections to any of the designs. • While the content can be changed, the layout would be permanent unless the city pays for changes. At some point, an updated city logo could be added and the pictures could be changed. 3. Bond Sale Analysis • Jonathan North of Ehlers discussed the pros and cons of the capital markets. o Political—con;justification for city to spend money can be controversial o Construction bids—pro;very favorable project bids have been coming in for other cities o Interest rates—pro;42 year low in rates was seen in October � City should review the draft CIP and upcoming projects. • Council noted that if projects are already on the CIP, moving the project to an earlier time may be justifiable. • Concern was expressed that the city's debt service is the highest it's been with a decreasing tax base and revenues. There are many unknown factors related to high-end residential markets and it may be better to wait until the economy improves before the city commits to additional debt. • Olson stated the next two major street projects are on Orono Orchard Road ($1.5 million) and Webber Hills ($200,000-300,000) as well as the non-MSA portion of Willow Drive. • North commented that the BBI is assuming rates will be relatively stable absent any major events. • Council questioned if there are available funds that could be used to buy-down the costs of projects. • Orono's debt service isn't high compared to other cities of similar size. The city has traditionally been very conservative. There may be some advantage to borrowing money at a low interest rate and prioritizing upcoming projects. • City Hall,the Navarre fire station, Big Island Park and the Pavement Management Plan are Orono's largest bond obligations. • Ron Olson will put together an analysis of existing bond debt and potential projects for the next 7-10 years. Council will continue to discuss the purchase of additional bonds. The new City Administrator has indicated that she would like to be involved as we continue to update the CIP. • North noted that long-term financial planning is a common topic in cities and depressed market values should be expected for another year. 4. Utility Rate Study Presentation • Jonathan North noted that Ehlers has a public finance seminar every year on long term financial planning and Ron Olson will be participating as a panel member in the utility rate study discussion. • The utility rate study was done using information from the draft CIP through 2016. Three funds including Water, Sewer and Stormwater were analyzed. • Water Rates Water rate structure goals are designed to: o Cover costs o Distribute cost across users consistently o Treat users equally (Navarre & Highway 12 areas) Page 2 of 4 Orono City Council Committee of the Whole December 15,2009, 6:15 p.m. Orono City Council Chambers o Comply with state mandate to implement conservation rates by January 1, 2010; which also encourages people to use less water. • Intent for increase in tier rates is to have heavy water users pay higher costs. • Water revenue volatility should be considered—less water used; less revenue. o Wet-dry years impact use o Residential usage spikes in summer for irrigation use • Operating revenue is slightly below operating expenditures. • Ehlers is recommending adoption of the tier structure and proposed rate changes based on the following: o Current rate structure is quarterly based on fixed costs and metered use for 3 different areas. o Tiering could lower bills for residents. o Rate increases are proposed at 6-8% in 2011-2016; typical of other cities. 0 3 tiers are proposed. Most users fall in first two tiers with approximately 33%in each tier. Allocation of tiers is defensible and rational. • Average water use is 100 gallons per person per day with no irrigation. • Rates are intended to be revenue neutral to city. • Need to revisit rate study in a few years to review usage. • Commercial/multi-family properties: ■ DNR interpretation applies to commercial also. ■ 13 of 41 commercial users in Orono fall into 3�d tier. o January 1, 2010 is the deadline for compliance in the metro area. The city won't be approved for any new wells until in compliance. o Water meters are in process of being replaced. Older meters may not be capturing all the usage as the usage rates seem low. • Reserve recommendations: o Utility funds should have 6 months of operating expenditures 0 100%of next year's debt payment o Small portion of next year's capital cost o Percent of accumulated depreciation • Sewer Rates o Conservation rate structure only applies to water. o Current sewer rates are billed quarterly. o Ehler's recommendation is to maintain overall rate structure and increase rates by 4% annually. The city has been raising rates yearly by approximately 3%. o Met Council expenses are outside the city's control. Met Council has not been collecting all expected connection charges and SAC funds are depleting. To offset their expenses, they are ramping up other costs. • Stormsewer Rates o No change to rate structure is recommended. o Residential equivalent unit rate should increase 8%- 10%annually for several years. • Summary of recommendations from Utility Rate Study: o Adopt rate structure and level of increases as recommended o Consider special assessments o Adopt reserve policies o Update utility study periodically—cities often use outside consultant Page 3 of 4 Orono City Council Committee of the Whole December 15, 2009, 6:15 p.m. Orono City Council Chambers 5. Schedule Joint Council and Planning Commission Work Session • Julie Westerland from the Watershed District would like to attend a joint Council and Planning Commission work session to present ideas regarding green development, impervious pavers and other technological advancements and trends. Tom Kellogg would also be available to discuss how the city is currently reviewing development projects and get input from Council for addressing storm water and green technologies. • Council suggested January 26`h as the date to schedule a joint Council/Planning Commission work session. 6. Miscellaneous a. Topics and Schedule for Upcoming Work Sessions o Stephen Grittman is scheduled to attend the January 12th work session to discuss strategy for the Comp Plan update. o The Common Bond group has talked to Ron Miller and probably won't be successful in purchasing his property. However, they could probably purchase the property north of the fire station. Common Bond will be invited to the January 26th work session to discuss development of the property behind the Long Lake Fire Station. b. Spring Hill Golf Club Plat o The plat for Spring Hill Golf Club was approved back in 2000. Because the club is also in the City of Medina, there has been a long history of filing the plat. Staff has been working with Tom Crosby to finalize all the details and complete the filing process. o Survey requirements have changed and the plat has been updated by MFRA, which includes documentation of wetland locations. There will now be one tax statement instead of several. o It's important to monitor documents that are sent to other cities for signatures. Some cities rely on their attorneys to track documents that involve approvals by outside agencies. 7. Comments Regarding Information Updates • None Page 4 of 4