HomeMy WebLinkAbout06-01-2000 Council Work Session'rn: Mayor Jabbour and Council Members
Ron Moorse, City Administrator
From: Mike Gatrron, Senior Planning Coordinator
Date: May 26.2000
Subject: Findings and Recommendation of Consolidation Study Committee
Work Session - Council Chambers - Thursday June 1, 2000 - 7:30 a.m.
After many months of consideration and debate, the Long Lake/Orono Consolidation Study
Committee has unanimously concluded that a merger of Long Lake and Orono would be
beneficial to both cities. Their findings and recommendations are encompassed in the attached
report/plan.
The Committee will be presenting their report at a joint public meeting of the Orono and Long
Lake Councils on Monday, June 5, 2000. 7:00 p.m. at the Orono High School Cafeteria. At this
meeting, the Committee will present its findings and recommendations, both councils and the
public will have an opportunity to comment or ask questions, and each Council will have an
opportunity to vote on whether to pro,.eed with the plan for merger. including placement of this
issue on the ballot at the September 12 primary election.
The attached report/plan is provided for your review prior to your Thursday, June 1, 7:30 a.m.
work session in the Council Chambers. Also enclosed is a copy of the newsletter/meeting notice
that was mailed today to all Orono and Long Lake residents and businesses. Please contact Ron
Moorse if you have any questions.
EHLERS
b ASSOCIATES INC
May 26, 2000
Jim Gelbmann
Board of Government Innovation and Cooperation
Third Floor Centennial Building
658 Cedar Street
St. Paul, MN 55155
Dear Mr. Gelbmann
On behalf of l::e Long Lake/Orono Consolidation Study Committee, I am pleased to submit the Plan for
Merger and Implementation. We request your review and approval of the Plan pursuant to Minnesota
Statutes, Section 465.82. We would appreciate consider of this Plan by the Board in June to make the
merged city eligible for Cooperation Aid in 2001. The receipt of the Cooperation Aid is an important
element of the implementation strategy.
The long Lake and Orono city councils will meet in joint session on June 5 to discuss the proposed plan.
I will notify you As soon as both councils have formally approved the Plan
As part of the Plan, the Board is requested to grant the following waivers under Minnesota Statutes,
Section 465.797:
Allow the period for filing atfidevits of candidacy for election to the city council to close on
September 15, 2000. This waiver relates to the requirements of Minnesota Statutes, Section
205.13. Solid. la. This waiver allows the filing period to close after the merger referendum.
With this timing, candidates will be able to seek election knowing the nature of the city and the
term of office.
2. Allow for a one-year term of office for city council positions elected in 2000. The term of office
is governed by Minnesota Statutes, Section 412.02 This waiver allows combined ten -member
city council to serve in 2000. Timing constraints will not allow election of the seven -member
city council for the merged city to occur at the 2000 November election. Election of the new city
council is Scheduled for November of 2001. We have assumed that the Plan authorizes the ten -
member city council for 200I and no specific waiver of council size is required.
Ir A 0 t AS IN YU0I IC I I N A`1C[
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Board of Government Innovation and Cooperation
May 26, 2000
Page Two
Waive the procedural requirements of Chapter 410 related to the use of a charter commission to
draft a city charier. The adoption of a city charter is an essential element of the merger plan.
The charter provides the basis for city council wards and for formal designation of a Long Lake
historic district. The Consolidation Committee strongly believes that the referendum on the
merger and the charter must occur at the same time.
The Committee drafted a charter (see Appendix C of the Plan). We do not seek to avoid the
electil,n requirements. Voters will approve the charter as part of the merger proposal. The
waiver seeks solely to avoid the process of a charter commission. For Long Lake and Orono.
this process would be nothing more than a formality, 10 approve the charter proposed by the
Committee. In addition, the liming of convening a charter commission and receiving approvals
could jeopardize the ability to put a separate charter question on the ballot for the Primary.
Minnesota Statutes, Section 275.065, Subd. I c allows the cities to make amendments to the
proposed levy until October 10. This authority limits levy adjustments to the "amounts related
only to the specific service involved". This language clearly relates the potential for consolidated
services between to jurisdictions. For a full merger, the cities need the ability to adjust all of the
proposed levies. We seek your concurrence that this latitude is allowed by the statute. If not, we
request a waiver of this provision.
I am in the process of preparing the formal application for Cooperation Aid. It will be sent to you as
soon as possible.
Thank you for your assistance in the planning process and for the Board's prompt attention to our Plan.
Please let me know when the Board will consider the Plan and waiver requests. Members of the
Committee w ill attend the meeting to address any questions. In the meantime- please do not hesitate to
call me with any questions.
Sincerely,
ON BEHALF OF THE CONS IDATION COMMITTEE
v `
J. Russell fifield. Jr.
cc. Shannon Sweeney - City of Long Lake
Ron Moorse - City of Orono
FINDINGS AND RECOMMENDATIONS OF
CONSOLIDATION STUDY COMMITTEE
i
PLAN FOR MERGER AND IMPLEMENTATION
COMMITTEE APPROVAL - MAY 25, 2000
TABLE OF CONTENTS
I ♦ INTRODUCTION
2 ♦ FINDINGS AND RECOMMENDATIONS ......... ......................
5
3 ♦ DEVELOPMENT AND LAND USE ....................................
13
4 • FACILITIES . ........................ ............................
17
5 ♦ SERVICES........................................................
20
6 ♦ FINANCE .............................................
........... 22
7 ♦ GOVERNANCE AND IMPLEMENTATION ........ ....................
33
APPENDIX A - MERGER STATUTE ...................................
. A - 1
APPENDIX B - FINANCIALASS'JMPTIONS ..................
.......... B - 1
APPENDIX C - DRAFT CITY CHARTER .................................
C - i
I ♦ INTRODUCTION
Acknowledgments
This report represents the work of many people. Before beginning the discussion of the
issues related to the proposed merger of Long Lake and Orono, the efforts and inspiration
of these people must be acknowledged.
The work presented in this report comes from the Consolidation Study Committee. The
Committee has worked diligently over the past nine months to understand the implications
of merger and to bring a recommendation to the City Councils and the public. The
Committee members are:
Long -Lake Representatives
Michael Personius
Gary Ringus
Neil Weber
Mike Bash (Mayor)
Shannon Sweeney (City Administrator)
Orono Representatives
Maybeth Christensen
Jim Murphy
Cliff Otten
Gabriel Jabbour (Mayor)
Ron Moorse (City Administrator)
The Committee's efforts were guided by Desyl Peterson. Desvl volunteered her time to
serve as facilitator for the study process. She is the Minnetonka city attorney. Her legal
insights were a valuable asset for the Committee. Desyl also brought experience from the
consolidation process in St. Bonifacius and Minnetrista.
Two other volunteers aided the Committee. Dave Child (former Minnetonka city
manager) and Craig Rapp (former development director for the Metropolitan Council)
helped the Committee design a planning process and evaluate issues.
Former Long Lake City Administrator Joe Lynch and City Planner Jennifer Chaput wok
jobs with other cities during the planning process They played important roles in getting
the process started and headed in the right direction.
The Committee received technical assistance from Ehlers & Associates. Ehlers collected,
analyzed and provided information to the Committee on the merger issues. Rusty Fifieid
of Ehlers also provided the Committee with direct experience from the successful merger
of Norwood and Young America. Ehlers serves as the financial advisor to both Long Lake
and Orono.
Thanks must also go to the Board of Government Innovation and Cooperation and Jim
Gelbmann, its executive director. In addition to grant funding for the study process, the
Board has provided technical assistance and advice throughout the process.
The Metropolitan Council also provided a grant to cover a portion of the planning
expenses.
Finally, the Committee thanks the residents of Long Lake a Jrono for their participation
in the process. Your questions and comments at public meetings provided valuable
guidance to the Committee. A special thanks goes to Richard Peterson. Mr. Peterson
attended almost every Committee meeting and provided the Committee with a citizen's
view of merger.
Study Process
The work of the Consolidation Study Committee spanned more than nine months. To
understand the implications of a merger, the Committee divided its investigation into six
issues areas: development and land use, facilities, services, finance, governance, and
implementation (see Figure 1). In this document, the terms "consolidation" and "merger"
have the same meaning. Both terms mean the combination of Long Lake and Orono into a
single city.
Figure 1
Consolidation Study Process
rLonsoirdationN ropiate
w+E
s
Values
Approvals
Issue Areas
Implementation
Study the issues
Through its study of the issues, the Committee sought to answer the fundamental question
of "►s c:msolidation appropriate for Long Lake and Orono?' The determination that merger
is in the best interests of both cities led the Committee to lay out a process to gain the
necessary approvals for the merger and then to create a new merged city.
This document summarizes the findings of the Consolidation Committee.
Values
At the beginning of the study process, the Consolidation Committee established a set of
values. These -•alues grew out of the initial public meetings held in September 1999.
These values served as guiding principles for review of issues related to merger. The core
of these values kept the focus of the Committee on how merger would influence the
quality of life for Long Lake and Orono residents. The values established by the
Consolidation Committee were:
• Maintain the complementary small town and rural qualities that exist in the
community.
• Pres •rve and support the unique commercial districts of the community in downtown
Long Lake and Navarre.
• Encourage and support small, service businesses.
• Preserve the existing character and variety of residential development relative to lot
size and other amenities.
• Small and accessible government.
• Equitable representation of the citizenry in governance.
• Sensitive and equitable treatment of city employees.
• Mutual long-term financial benefits for the communities.
• Maintain .nd enhance city services.
• A consolidation planning process that results in an informed public with ample
opportunity for input.
2 ♦ FINDINGS AND RECOMMENDATIONS
Summary
After an extcnsive study, the Long lake/Orono Consolidation Study Committee has found
that a merger would benefit both cities, and has unanimously voted to recommend that the
two cities be merged. This recommendation concludes a nine -month process of studying a
broad range of issues related to the merger.
Through its investigation, the Committee found numerous benefits of merger. The
benefits of merging Long Lake and Orono into a single city include:
Development and Land Use
• Enhanced ability to address development and land use issues in a way that preserves
the existing character and variety of residential development, maintains the existing
small town and rural qualities, and supports the unique commercial districts.
• Unified approach and additional resources to meet redevelopment needs in Long Lake
and Navarre.
• Elimination of the ability of outside interests to play one city against another.
Public Facilities
• Elimination of duplication of public facilities and potential for enhanced facilities; i.e.,
city hall, public works, and water and sewer facilities.
• Reduction in the amount of land necessary for public facilities. Retention of laud for
development needs, and expansion of the tax base.
• Enhanced planning for public facilities related to systems that do not follow city
boundaries such as transportation, sanitary sewer, and stormwater.
• Improved ability for integrated parks and trail planning.
Services
• Strengthening of the capabilities of the city staff through the consolidation of the two
sets of staff.
• Elimination of substantial time an. ^ffort spent by both cities negotiating and
administering fire and police contracts with each other.
Finance
• Lower spending for government services in a merged city than for two separate cities.
• Lowest long-term cost for government services.
• Reduction of the city portion of property taxes for Long Lake residents by nearly 50%.
• Both short-term and long-term stabilization of property taxes for Orono residents
through strengthened staff capabilities as a result of the merging of the staff from both
cities, and efficiencies related to public facilities, as well as avoidance of intercity
disagreements and litigation.
• Receipt of up to $577,000 in cooperation grants to enable upgraded facilities and
equipment.
• Better control of taxes through the linking of land use decisions with service impacts.
Governance
• Strengthened voice with other agencies to protect and promote the interests of the
city.
• A merger, with the proposed ward system, enables the many interrelated issues facing
the two cities to be addressed by one governing body; while ensuring the Long Lake
and Navarre areas are able to be represented on the governing body.
Concerns Voiced at Public Information Meetings
The three most significant concerns expressed at the public information meetings held by
the Committee are listed below. The Committee believes it has substantially addressed
these concerns through its proposed plan for consolidation.
Concerns
• Loss of Long Lake name.
• Loss of voice by Long Lake residents.
• Potential diversion of attention away from Navarre.
Response to Concerns
• The place names of both Long fake and Navarre will be displayed on
prominent signs and on water towers.
• Both the Long Lake and Navarre identities would be preserved through the
creation of special historical districts encompassing the two areas, and
carrying the names Long Lake and Navarre.
• Through the use of a "ward" system for elections, the areas around both Long
Lake and Navarre will be guaranteed representation on the city council.
Recommended Plan for Merger
• Merger takes effect January 1, 2001, with a one-year transition period.
• For one year, a joint city council would be responsible for governing the city.
• The joint city council would consist of the mayor and four council members from
Orono and the mayor and four council members from Long lake.
• An election for a new seven -member city council would occur in November 2001.
A city constitution (the charter) would be adopted which creates a seven -member city
council.
• Mayor and two council members elected by all voters.
• Four council members elected from four separate wards.
• One ward contains the Long Lake area.
• One ward contains the Navarre area.
• Two additional wards cover the remainder of the city.
The legal name of the new city would be Orono, but the city charter guarantees the
identities of Long Lake and Navarre are preserved.
• Establishment of Long Lake and Navarre historic districts.
• Signs posted on thoroughfares.
• Names painted on water towers.
• Mailing addresses remain as is.
• Fire Department keeps Long Lake name.
Merger Not Effective Unless Approved by Voters
These are the steps that must be followed before a merger can become effective:
• City councils of both Long Lake and Orono review the plan on June 5, 2000.
• If approved by both councils, the plan goes to a state agency, called the Board of
Government Innovation and Cooperation (BGIC) before the end of June.
• If approved by the BGIC, a referendum on the issue would be held at the September
12 state primary election.
• Merger only becomes effective if a majority in each city votes in favor.
• November city council elections would be for only a one-year term if the merger is
approved.
• Merger would take effect January 1, 2001.
Statutory Factors
State Law lists nine items that must be specifically addressed in the plan for the merger of
Long lake and Orono. This section discusses each statutory factor with reference to other
supporting materials in this plan. Appendix A contains the State Law governing the
merger, including these statutory factors.
1. Specific cooperative activities during the first two years.
Long Lake and Orono have a long history of cooperative activities, including shared services
for police and fire protection. This history allows for a short transition to a merged city.
Rather than engaging in a period of cooperation leading to a merger, Long Lake and Orono
plan to merge by the end of 2000. During the last ha;f of this year, the cities will engage in
a variety of cooperative activities:
• Public information and education on proposed merger.
• Preparation of 2001 operating budgets.
• Continued planning for Highway 12 improvements.
• Study options for relocation of Fire Department facilities.
• Planning for specific merger implementation steps.
2. Steps to be taken to effect the merger.
Voters will be asked to approve the merger at the September 12, 2000 primary election.
This election will also approve the charter for the merged city. The merger will take effect
on January 1, 2001. This timing allows time following the referendum to prepare for
merger, including the creation of an operating budget. The timing also coincides with the
fiscal year, preventing complications in financial reporting.
3. Steps by which a single governing body will be created
Under this plan, the existing city councils will become the "interim governing body"
immediately following the election. This plan requests that the Board of Government
Innovation and Cooperation extend the filing period for City Council positions until
September 15, 2000. Hennepin County requires this information within five days of the
election to place the name on the regular printed ballot. This extension allows City
Council candidates to know if they will serve a merged or separate city.
Council members with remaining terms and members elected in 2000 will combine to
form the initial ten -person City Council of the merged city. This bociv will exist only
through 2001. A new seven -member city council will be elected in November 2001 and
take office in January of 2002.
The City Council of the merged city will consist of seven members. Four Council positions
will be elected from ward... The remaining two positions and the mayor will be elected on
an "at large" b.ui-
Additional information on the city council and form of government can be found in Section
7, Governance and Implementation.
4. Changes in services, facilities, and administrative operations staffing and a two-,
five-, and ten-year projection of expenditures with and without merger.
Services and Staffing: The merger plan deals with immediate and long-term service
implications. The immediate objective is to maintain the existing levels of services. The
long-term objective is to enhance service and to provide capacity for new services.
The existing service structures in Long Lake and Orono provide a good foundation for
merger. The merger will not cause any change in the type of services. Long Lake and
Orono currently share fire and police protection services. All existing employees will be
retained and combined into departments of the merged city. Both cities use consultants to
supplement paid staff. Financial, assessing and legal services more easily adjust to the
change from separate to merged city.
This combination of existing staffs has several advantages:
• The merged city will have the capacity and understanding to maintain existing service
levels.
• The merged city will have the administrative capacity to deal with the demands of
merger implementation, Highway 12 reconstruction and on -going city services.
• Merger avoids the need to hire new staff for some time. Orono faces the projected
needs for additional staffing without merger.
• The combined skills and experience of the merged staff provides capacity to meet
changing needs as the community continues to grow.
More information on Services can be found in Section 5.
Facilities: Merger has important implications for city facilities. The existing Long Lake city
hall, public works facility and fire station will be lost to the reconstruction of Highway 12.
Without merger, Long Lake will replace city hall and public works buildings. With merger,
the existing Orono municipal facilities will be remodeled to house all administrative and
public works functions.
m
This facilities plan has several advantages:
• Merger avoids spending money on duplicating public facilities.
• The cities will save money on facility operations and maintenance.
• Compensation to Long Lake for lost facilities can be used for other public needs
• Shared facilities keeps more property on the tax rolls and available for development
The relocation of the fire station is not affected by merger. A study to determine the
location of the fire station is underway. The location will be determined on the basis of
land availability and service considerations.
The merger will not have an immediate impact on parks and recreational facilities. in t',,
long-term, a common development plan and combined resources will enhance parks and
trails in the community.
):jpincial Projections: Projections of expenditures and revenues for two, five and ten year
per ods appear in Section 6. These projections compare city finances with and without a
merger. The projections show:
• City spending will be less with a merged city than with two separate cities.
• Merger provides the best opportunity to hold down the municipal (city) portion of
property taxes.
• Merger avoids duplication of expenditures and allows more money to be applied to
public services and facilities.
• The projections provide a budgeting and planning framework for the merged city.
5. Treatment of employees.
The merged city will seek to retain the existing employees of both cities. No bargaining
units or contracts are affected by the merger. The reorganization of departments and the
modification of personnel policies will be addressed by the City Council following voter
approval of the merger. The merger plan does not call for any financial incentives for early
retirement.
6. Financial arrangements for the merger.
All financial assets and liabilities of the existing cities will transfer to the merged city
The merged city will establish an economic development authority (EDA). The EDA will
be assigned administration of existing Long Lake tax increment financing districts. The
EDA will assume all existing development agreements and related pay-as-you-go TIF notes.
The EDA will be given housing and redevelopment authority (HRA) powers and will
assume the lease obligations of the current Orono HRA related to the bonds for the
municipal building.
All existing bonded indebtedness and other debt obligations will become a liability of the
merged city. All special assessments, tax increments, and utility revenues will be collected
by the merged city and used to pay principal and interest on existing bonds. Any taxes
needed to nay debt service will be levied on the taxable valuation of the merged city. A
debt service tax levy is included in the financial projections.
7. State prepared analyses on impact to major state aid revenues and property tax
revenue implications associated with tax increment financing districts and fiscal
disparities.
The Minnesota Department of Revenue provided the information in regard to this statutory
factor. This information can be found in Appendix H. All responses are based on current
law and are subject to change from future legislative actions.
8. Procedures for a referendum on merger.
A referendum on the proposed merger of Long Lake and Orono will be held on September
12, 2000. The referendum will be approved if a majority of those voting in each city vote
in favor of merger.
12
9. Time schedule for implementation.
The time schedule for the implementation of the merger of Lung Lake and Orono includes
the following events:
May 31, 2000 (on or before)
Merger Plan finalized and adopted by Consolidation
Committee.
Merger Plan submitted to Board of Government
Innovation and Cooperation and Metropolitan Council
for review.
June 5
Joint City Council meeting to review Plan.
June 20 (on or before)
Plan approved by City Councils.
Plan amendments for Council review (if any)
forwarded to Board of Government Innovation and
Cooperation and Metropolitan Council.
Budget planning for 2001 started.
Notification of pending merger sent to Department of
Revenue and Hennepin County.
June 30 (on or before)
Plan approved by Board of Government Innovation and
Cooperation.
July 28 (on or before)
Plan amendments requested by Board of Government
Innovation and Cooperation (if any) adopted.
City Council action to set referendum.
Ballot question sent to Hennepin County.
July - August
Voter information and education.
September 12
Referendum
September 15
Last day to file for open seats on City Council in both
cities.
September 18 (on or before)
Initial meeting of combined City Councils as interim
governing body.
October - December
Preparation for effective date of merger.
January 1, 2001
Merger takes effect.
3 ♦ DEVELOPMENT AND LAND USE
The Consolidation Committee study process began with an examination or development
and land use trends. The growth of the cities influence the demand for city services and
facilities. The Committee's work focused on two basic questions:
• How will Long lake and Orono grow?
• What implications does merger have on growth and development
1. The Long Lake -Orono community will continue to grow.
The growth trends in this report
are based on actual historic data
and on the current projections
from the Metropolitan Council.
It should be noted that
populations projections madr by
Long Lake and Orono differ
slightly from those of the
Metropolitan Council. These
differences are not significant for
the purposes of merger. All
projections show that the Long
Lake -Orono community will
continue to grow.
Figure 2 contains the historic and
projected trends for growth in
population for the cities.
Household trends are shown in
Figure 3.
13
Figure 2
Actual and Projected Population
14
2. The development patterns
of Long Lake and Orono
are compatible and inter.
related.
In reviewing the land use and
development patterns, the
Committee reached the
following conclusions:
• Development in Long Lake
is characterized by compact
residential and the
"Downtown".
• While located in Long Lake,
the downtown area serves a
broader community.
Figure 3
Actual and Projected Households
iism
Nor
1970 1980 1990 2000 2010 2020
■laglaka OQvro
• Orono contains a variety of
land use patterns. Large lot residential development combines with "neighborhoods"
similar in character to Long Lake, such as Navarre and Crystal Bay.
• The overall character of the community is a combination of commercial districts,
compact residential, large lot residential and open spaces. The merger promotes the
continuation of this form of community.
• Long Lake and Orono rely on a shared set of businesses, services and institutions.
• Long Lake and Orono share and need to protect a unique setting with important
natural resources.
3. Many key development issues span city boundaries.
• The reconstruction of Highway 12 is the single most important development issue
facing the community. The impacts and opportunities created by the project can best
be managed by a merged city.
• The redevelopment of downtown Long Lake affects both cities. Merger provides a
unified planning process and pooled financial resources.
li
• Merger provides the best opportunity to maintain the complementary small town and
rural qualities that exist in the community.
• Long Lake's experience in redevelopment could be helpful in determining options for
meeting development needs in Navarre.
• Without merger, Long Lake is likely to seek more intensive development to increase
tax base and offset future tax increases. Such development will lead to higher service
costs for Orono due to shared service contracts.
• Without merger, Orono could allow highway oriented commercial development that
would limit redevelopment in the downtown area of Long lake.
4. Comprehensive plans and land use ordinances not a barrier to merger.
The Consolidation Committee reviewed existing comprehensive plans and land use
ordinances. While the plans and ordinances are different, the Committee did not find
changes that were required to merge the cities.
The Committee recommends that the currr t zoning districts could remain in place on an
interim has::. The review of plans and ordh.,hces will occur as part of implementation
with opportunity for public input.
5. The Long Lake tax increment financing districts have promoted new development
and do not pose a financial barrier to merger.
Tax increment financing (TIF) is a tool available to cities to promote development and
housing. Long lake has three active districts (see Figure 4). The actual number of parcels
within TIF District #1.1 is less than shown in Figure 4. Parcels have dropped from the
District over time due to lack of development activity. The remaining districts are small
and project focused. The City will hold a public hearing on June 20 to consider establishing
a new TlF district (#1-5). Orono has no, created any TIF districts.
The merger implications of these TIF districts include:
• The merged city will assume control over the districts and the receipt of revenues.
Control over the district will be assigned to the economic development authority for
the merged city.
• The lower tax rate for the merged city will reduce the amount of annual tax increment
revenue from the TIF districts. Revised financial projections show that the reduced
revenue will be sufficient to pay debt service on the outstanding bonds. All existing
Iv
tax increment support debt will be retired within three vears of the effective date of
the merger.
Figure 4
Long Lake TIF Districts
TIF #1-5 TIF #1-4
• When the tax increment financing districts ends, the overall tar base of the city
expands.
4 ♦ FACILITIES
Public activities are essential elements of the development of a community. Public
facilities provide the capacity for development to occur and help to shape the face of the
community. The construction and maintenance of public facilities use the financial
resources of the cities. The Consolidation Committee examined the issues surrounding
public facilities by asking "What public facilities are provided by the cities?" and "How will
public facilities be affected by a merger?' The Committee divided public facilities into
three groups: buildings, infrastructure (streets, water, sanitary sewer, and storm sewer),
and parks.
1. Merger offers the best means of previding public buildings and minimizing the cost
to tax payers.
• Long Lake loses City Hall, Fire Station and Public Works buildings from the Highway
12 project.
• The Minnesota Department of Transportation (MnDOT) will pay for the replacement
of Long Lake facilities.
• Orono facilities can accommodate Long Lake City Hall and Public Works with some
remodeling. The cities will seek to obtain state funding (Cooperation Aid) to finance
the remodeling.
• The location of the Fire Station is independent of the merger process. A consultant
has begun the process of studying potential locations.
• Without merger, Fire Station costs exceeding MnDOT compensation will he paid by
tax payers in Long Lake, Orono and Medina.
• Merger creates more options for public facilities by preventing duplication and
providing potential for enhanced facilities. Money not used for facilities would be
available for other needs.
• Merger minimizes the amount of land needed for public, tax exempt purposes. More
land would be available for development needs and expansion of tax base.
17
K
2. A merger improves the ability to provide for the construction and maintenance of
public streets.
• Street construction does not create city-wide expense. New streets are financed at
the developer's expense or 100% assessed to the property owner.
• If private streets become public, the property owner bears the expense to upgrade.
• Merger increases State aid for street maintenance and construction (See Section 6).
• Both cities have financial capacity to support maintenance and construction of public
streets.
3. Sewer and water service will not be affected by merger. Merged utility systems may
avoid future costs.
• Both cities operate sewer collection systems and rely on the metropolitan system for
wastewater treatment.
• Expansion of sewer system is not affected by merger. The sewer system is limited by
the 'Municipal Urban Service Area" defined by the Metropolitan Council.
• Interconnection of the Long fake and Orono utility systems improves service and may
avoid future capital expense. Sewer and water interconnection study is underway as
Fart of the Highway 12 project.
• Sewer and water improvements paid for by users through user fees, connection
charges, and assessments. The conversion of private sewer and water systems paid by
property owner with no expense to the tax payer.
• Sewer and water system operations are supported by user fees. Merger does not
require changes in the existing rates and costs to users.
4. Merger creates a common approach and solutions for storm water management.
• The management of storm water and drainage issues best fits the broader focus of a
merged city. These issues cross the existing city boundaries.
• Long Lake has established a storm water utility. Orono has considered a utility, but
one has not been created.
• In a merged city, the Long Lake utility could be a special service area of the utility
could be expanded into the entire city.
• The Highway 12 reconstruction will create and fund storm water management
improvements.
19
5. Merger offers the best means of providing public buildings and minimizing the cost
to tax payers.
• In the near term, park funding will not be affected by rn_rger. The broader financial
base of a merged city may provide more resources for the construction and
enhancement of parks over time.
• Merger improves ability for integrated trail planning and construction in the
community.
• The existing Orono golf course operates as a self-supporting utility. It is not affected
by the merger decision.
6. Parking may become a more important form of infrastructure.
• Orono provides and maintains public parking areas in Navarre.
• Adequate parking is an important issue for the continued development of Navarre and
Long lake.
5 ♦ SERVICES
Understanding public services was an important part of the consolidation study process.
Services are the primary product of city government. The public perception. of the quality
and effectiveness of services influences the evaluation of city government. From a financial
perspective, services are a driving force in projecting property tax impacts.
The Consolidation Committee's study approached public •ervices issues through the
following questions. How - the cities currently serve the community? How might
services change in the future! How will public services be affected by the merger?
1. The Consolidation Committee recommends that existing staff are retained as a
result of a merger.
R-taining existing staff offers several advantages for a merged city:
• The merged city would have the capacity to meet existing needs for both cities.
• Retaining experienced personnel keeps the knowledge of the community. This
knowledge is particularly important in operating and maintaining utility systems.
• The combined staff provides the service capacity for continued growth and the
potential to address unmet needs
2. Long Lake and Orono have similar end compatible administrative functions.
• Both cities operate under State Law as "Optional Plan A" cities.
• The cities are governed by a five member city council with the services of a city
administrator
• The primary differences in the cities can be found in staff size and service capacity.
• The merged city would use the same system, but operating under the authority of a
"city charter." The city charter is discussed in the Governance and Implementation
section.
• Both cities use consulting services (legal, financial, engineering, assessing) as an
alternative for additional staff. This approach creates flexibility in considering the
implications of merger.
20
FT
3. As shared services, police and fire services offer a good foundation for merger.
• Orono provides police protection for all of Long Lake.
• The Long Lake Fire Department serves a large portion of Orono.
• Merger will not change fire service for the sections of Orono that receive fire
protection from cities other than Long Lake.
• These shared services mean that merger will not alter the basic .ervices now received
by the community.
• The Committee believes that merger offers the potential for improved public safety
services. In a merged city, the focus is on service, rather than contract negotiation and
management.
A. Merger means the ability to maintain or enhance service levels for public works
• Public works departments in both cities deal with similar functions. Public works is
responsible for maintenance of streets, municipal utilities and parks.
• Retaining existing staff provides important knowledge of service delivery and system
needs. This understanding helps the merged city maintain existing service levels.
• A merged city has the capacity to enhance service levels by coordinating work across
the broader common',).
• A merged city should r'md efficiencies in the operation and maintenance of facilitit,
and equipment.
6 ♦ FINANCE
The Consolidation Committee believes that merger provides mutual long-term financial
benefits for the communities. In reaching this conclusion, the Committee considered:
• Approach to financing facilities and services in each city.
• Current financial condition.
• Outstanding debt.
• Projected operating revenues and expenditures, including impacts on tax payers.
The comparison that must be made is not between today and a merged city, but rather
between a merged city and the future for two separate cities. The following section
summarizes the Committee's findings related to the financial implications of merger.
1. Without a merger, it is likely that property tax rates will increase in both Long Lake
and Orono. With a merger, the property tax rate will drop significantly in Long
Lake. A merger also creates the ability to reduce future tax rates in Orono.
Property taxes are the most common means of measuring the cost of local government.
Property taxes are the largest source of locally controlled revenues for cities. Property
taxes are also the largest and most visible indicator of government cost to most taxpayers.
Consequently, property taxes will be an important tool for evaluating the implications of a
merger of Long Lake and Orono.
For t: xes payable in 2000, the city property tax rate is 27.767% in Long Lake and 14.807%
in Orono. With the overall reduction in spending and the broader revenue base, a merger
results in a significant reduction in the tax rate for property in Long Lake. A merger also
creates the ability to reduce future tax rates in Orono through lower cost services and a
broader revenue base.
Figure 5 illustrates the projected property tax rates over the next ten years. In every year,
the property tax rate for a merged city falls below the rate for either city without a merger.
22
Figure 5 23
Projected City Share of Property Tax Rate
With and Without Merger
40.00%
35.00%
—
GG
30.00%
1
a
25.00%
rc
r
20.00%
x
15.00%
10.00%
5.00%
0.00%
2001 2002 2003 2004 2005 2006 2007
2008 2009
2010
r
■Merged 00iono - No Merge a Long Lake
- No Merge
The Committee determined that merger needs to reduce the property tax rate in both
Long Lake and Orono. To do this, the financial projections include an estimated amount of
"additional funding" needed to lower the tax rate in Orono. The Committee does not
recommend a specific plan for the additional funding. These decisions will be made using
actual data for creating the initial operating budget for the merged city. The Committee
identified a range of sources for the funding:
• Monies paid by MnDOT as compensation for the Highway 12 project.
• Existing reserves of Long Lake.
• Growth in taxable property value in excess of the projections.
• Increases in other revenues not shown in the projections.
• Decreases in expenditures not shown in the projections.
The tax rate shows only one piece of the property tax impacts. The taxpayer view of
impacts comes from the tax payment. The tables in Figures F compare the estimated 2001
city share of property taxes with and without merger for different values of residential and
commercial property.
Figure 6 2.1
Impact on Estimated Property Taxes Payable 2001
Residential Homestead Property
Tax Capacity
Estimated
(Taxable)
City Share of Property
Taxes
Market Value
Value
Merged
No Mercer
Difference
Orono
100,000
1,156
171
177
-6
150,000
1,981
293
303
-10
200.000
2.806
415
429
-14
300,000
4.456
660
682
-22
400,000
6,106
904
934
-30
Long Lake
100.000
1.156
171
329
-157
150,000
1.981
293
563
-270
200.000
2.806
415
798
-382
300,000
4,456
660
1,267
-607
400,000
6,106
904
1,736
-832
Commercial -Industrial
Property
Tax Capacity
Estimated
(Taxable)
City Sham of Pmperly
Taxn
Market Value
Value
Merged
jopy»E
Qy( nine
Orono
200.000
5,300
785
811
-26
350,000
10,400
1,540
1.591
-51
500,000
15,500
2,295
2,371
-76
1,000,000
32,500
4,812
4,971
-159
2,000,000
66,500
9.847
10,171
-325
Long Lake
200,000
5.300
785
1,507
-722
350,000
10,400
1,540
2,956
4,416
500,000
15,500
2,295
4,406
-2,111
1.000,000
32.500
4.812
9,239
-4,427
2,000,000
66.500
9,847
18,904
-9,057
2
It is important to keep property taxes in perspective. City government represents the
smallest portion of the overall property tax (see Figure 7). In Long Lake, less than 20c out
of every $ 1.00 of property taxes goes to the City. Orono taxpayers send only 12tr out of
every $ I.00 of property taxes to the City.
Figure 7
Distribution of 2000 Property Tax Rate
Orono Lon{ Lake
City
Other , Other City
y
School
School
caonty
County
MI
2. Both cities are in good financial condition.
As part of the planning process, the Consolidation Committee reviewed financial
information about each city. From its investigation, the Committee determined that both
Long Lake and Orono come to a merger in good financial condition.
Figure 8
Long Lake Governmental Funds 1999
Spacial
Debt
Capital
Revenues
Stanem
1,104,789
Rainenue
121.867
Service
263.552
pfolects
44,250
Expenditures
1,046,668
152,850
713,734
898,651
Excess Revenues
58,121
-30,983
-450,182
-854,401
Other Financing Sources/Uses
-1,338
2.761
326,819
466,030
Total Excess Revenues
56,783
-28,222
-123.363
-388,371
Fund Equity Transfers
0
636,568
-636,568
0
Year End Fund Balance
656,723
946,116
240,295
.416,447
Balance as % of Expenditures
62.74%
618,98%
33.67%
.46.34%
Figure 9
Orono Governmental Funds 1999 (Unaudited)
Special
Debt
Capital
General
KInnue
Se"Ice
pralKh
Revenues
4,110.216
306,345
1,006,097
808,543
Expenditures
3,811,078
568,054
1,007,412
1,328,618
Excess Revenues
299,138
-261,709
71,315
-520.075
Other Financing Sources/Uses
-78,609
-35,000
141,804
1,132.986
Total Excess Revenues
220.529
-296,709
140.489
612,911
Fund Equity Transfers
0
0
0
0
Year End Fund Balance
2,176,826
2.750.888
4.614.053
1.029.211
Balance as %of Expenditures
57.12%
484.27%
458.01%
77.46%
Figure 8 contains the data from Long Lake's 1999 Annual Financial Report. The
information shows very strong financial positions for the key operating funds. The deficit
n
in the Capital Projects Fund represents expenditures for improvements rrojects that will
be financed and funds restored by a future bond issue.
Operating data for Orono appears in Figure 9. This summary shows the excellent financial
condition of Orono. All funds have created and maintain strong fund balances.
These figures illustrates two important points about the merger. The merger is not needed
to fix a current financial problem in either city. The combined resources of the cities form
an excellent foundation for implementing the merger and facing future service and facility
needs.
3. Merger reduces total spending by cities and provides the lowest cost for city services.
To evaluate the financial implications of merger, the Committee prepared 10-year financial
projections for Long Lake and Orono with and without merger.
The financial projections build on the actual 2000 operating budgets. For a merged city,
the Committee evaluated revenue and expense changes that should occur as a result of a
merger. The rationale for these changes •re explained later in this section. The
Committee combined the adjusted reverses and expenses to create a base year budget for
the merged city.
The financial projections extend from the base year for a ten year period from 2001
through 2010
The financial projections focus on the General Fund. The General Fund will be most
affected by merger. This Fund finances the primary city services. The General Fund also
creates the largest demand on property taxes. For Long Lake, the analysis also includes the
special revenue fund for the Economic Development Authority (EDA). A portion of the
City's operating costs are funded through the EDA.
The Committee recognizes that the projections merely forecast a potential future. History
clearly shows that changes will occur and reality will be different from the projections.
Nonetheless, the projections provide the means of evaluating the financial implications of
merger. By applying the same basic assumptions, it is possible to compare a merged city
with the continuation of two independent cites.
Figure 10 on the next page summarizes the financial projections. The summary contains
the financial projections for the base year (2000) and 1, 2, 5 and 10 years into the futur .
28
Figure 10
Summary of Financial Projections
Saw rear
1
2
5
10
2000
2001
2002
zM
21W
MERGED Ott
Revenues T.
2366,502
2.023.SW
2,246,833
2611,050
3,205.488
Lanus S Pnmes
299900
308.897
318.16L
3U.666
103,011
hhrpomnmental
856,:62
906.249
915.816
903.S66
9a9,652
Cnapo
874,528
900,26,1
927.787
1.013.818
1.175.293
Ga.
373.980
639,440
511,I66
500. 193
502,598
Total
1,223,C22
.. 779,433
4,922,816
5.379.294
6.236.D16
EaIMblhrM bministraYRn
999,021
1.028.%2
1.059.861
1, 158.139
1.342.601
Pri Mlely
I.990,3a.5
2,050,066
Z.IIL568
2.307.367
2.631,871
Marx.,
455,375
40.036
493,107
528,801
611,986
RRwa was
%22,125
2,19.789
978,282
l,068.996
1.239159
OtnN
273,350
111.551
269,992
316888
362.360
Taal
400.225
4.>79,433
4.922.816
5,329.29a
6.236.076
OIMr General Lery
95,150
88.014
90,651
W.060
114.938
Des Levy
1:9,203
119]00
119.200
119,200
119.200
INTO LMy
2.871,652
2,531,291
2.757.237
3,132.510
3.210.025
AMrtmal FuRd,,
251,240
112.410
66,6C8
0
Es9mahE Ta Rah
N1
11.901%
15861%
17051%
19432%
OROHO WITHOUT MERGER
R. Taees
1,859.410
1.980.113
2,155,189
2,518.376
3,131.328
.... &armU
2W,000
271,920
280,078
306.018
3U,7!Ni
IMveHemHai
563.280
50.418
575.112
592.538
622,26a
CNNw
L108.390
1.111.612
1.175.691
1,284,928
1.489.583
OOHr
258,900
266.662
211,662
300.136
U7.%O
Tan
4,053.480
1,229.259
4,4 0.937
5,002.026
5,916.109
4p MaNta bmrNNRDi
847 130
872.853
983,176
1.021,343
1.215.158
PUwrt"My
1.905.1W
1962.614
2.021.492
2.291.839
1,329J82
PRx.a,
323.960
4,39.851
153.019
495.059
513,909
Puwc sr9rh
613.590
693,798
714,759
857.431
1u51,178
Other
253,050
260,4542
266161
293.351
310,078
Tw11
1,053.180
4.229.759
1,160,932
5,002,026
5.916.409
Olher Uehea, Lary
85.15r3
96011
901651
99.060
111,a38
Dam Lny
119.200
419.200
119,100
119,200
119,700
Taal Levy
2.363,560
2.182.926
2,665.513
3.037.136
3.665,866
Estimates Tax Rate
11802%
1529S%
16.062%
17251%
18.859%
LONG IAE WITHOUT MERGER
R-enwe
Ta.ee
508,092
529.306
551.216
621311
15a,226
Vill.&IHrmse
35.900
36,977
38.086
11.618
49.217
Imer9amrMNn:al
298,552
Ml S3
304.5m
313.186
329,793
CnnEn
153340
157 9W
162628
11,10
206026
Ulher
115.080
11 .Wo
122,068
133.109
154658
Tsai
1.110.969
1. 114198
1.128.E9
1.287,919
1,493,0^9
EapeMitwn
bm,niRr/iron
216.866
223.393
230.091
251430
291.171
Puw¢utery
476.833
491.IM
605.622
552.780
640,821
R1nwq
U.415
91.062
93.299
102.492
118.1122
Puwrt.4
248.535
255.991
263.621
286120
334,010
Olar
W.300
82,209
85.190
93,090
107,916
Tan
1.110.969
1.14a.2%
1.175.627
1.287.9t8
1 193.019
EmmtlM Tar R.I.
27 Ism
28427%
29910%
32911%
36259%
29
Merger will increase State aids to the community and allows for more flexibility in using
State funding related to the Highway 12 reconstruction.
MaDOT Compensation
As noted earlier in this report, Long Lake will receive compensation from the Minnesota
Department of Transpn-tation (MnDOT) for the loss of public buildings. The amount of
the compensation has not been determined. This funding has important implications for
the merger.
• With merger, Long Lake will not spend this money on building a new city hall and
public works facility (see Public Facilities). This money would be available for other
purposes. The use of MnDOT funding has not been factored into the financial
projections, except as a potential source of funding to reduce the merged city s tax
rate.
Regardless of the merger decision, a new fire station will be built. If the cost of the
fire station exceeds MnDOT compensation, then additional funding will be needed.
With merger, this funding could come from money saved on city hall and public
works. Without merger, other local monies will be needed. Orono currrntly pays 70%
of costs under the fire service contract. The projections do not include additional
costs for the fire station.
• Without merger, Long Lake will bear the cost of city hall, public works facilities, and
its share of the fire station not covered by the MnDOT compensation. The financial
projections do not include any additional facility costs without a merger.
Cooperation Aid
The State of Minnesota provides financial assistance to help offset the costs of
implementing the merger. Under the statutory formula, Lung Lake/Orono is eligible to
receive "Cooperation Aid" equal to $15 per capita annually for maximum of four years.
The Aid calculation uses the State Demographer's population estimates. With a combined
1998 population of 9,617, the merged city could receive $144,255 annually, totaling
$577,020 over the four year period.
• Cooperation Aid is not an entitlement. The cities must apply to the Board of
Government Innovation and Cooperation to receive the Aid. Given past uses of
Cooperation Aid, funding the merger of Long Lake and Orono should be approved.
• Cooperation Aid must be used to fund to actual costs of implementation. These costs
will include remodeling and expansion of the Orono municipal office and public works
facilities, staff tune, computer systems, utility system interconnections, updated
comprehensive plan, combined city ordinances and regulations, signs, and
communications.
• The availability of Cooperation Aid, like all State programs, is subject to continued
funding by the Legislature. Appropriations for Cooperation Aid will be considered in
the 2001 legislative session.
State Aid for Roads
Cities over 5,000 population r :eive "municipal state aid" (MSA) for the construction and
maintenance of streets. Currently, only Orono receives MSA. Merger increases the amount
of aid that will be allocated to the community.
MSA is based on three basic factors: (1) the total available funding, (2) local population,
(3) 25 year c struction needs for the local state aid street system. The actual amount of
MSA for the merged city will not be calculated until after the merger. It is estimated that
the merger will increase the local allocation by $51,500 per year.
4. A merged city will avoid costs that will arise from administering shared services and
managing shared issues that occur with two separate cities. By avoiding the costs of
intercity issues, more money will be available for service and capital improvements.
Not all of the "savings" of a merger can be quantified. During its study process, the
Consolidation Committee identified certain costs that will be avoided through a merger.
These avoided costs will result in less expenditures and better services in the future. These
costs are difficult to specify in amount and timing
Service Contracts: Without merger, Long lake and Orono will continue to share Fire and
police services. The creation and administration of these service contracts is an expense to
each city. With separate cities, the focus is often on administering the contract and the
specific interests of one city. With a single city, the focus shifts to providing the best
possible service and costs to the entire city.
Spillover Costs: The service contracts create a direct financial connection between the two
cities. Development in one city can lead to the need for more expenditures for police or
fire protection. While only one city benefits from the increased tax base, both cities share
in the additional service costs. The financial implications of this issue are particularly
important for Orono as its pays for the largest share of service costs.
Coo ration: Failure to merger the cities will not end the need for cooperation. Many
issues will affect both Long lake and Orono.
Disputes: Not all shated issues will be resolved with cooperation. Some issues will result
in disputes. The resolution of a dispute often produces legal and other cot,sulting expense.
31
5. The Committee recommends that the user fee structure for sanitai- sewer and water
services remain in effect.
• The existing rate structures produce adequate operating revenues. There are no
immediate financial reasons for adjusting the rates.
• Orono currently applies different water rates to geographic areas of the city. Adding a
"Long lake" rate fits within this structure.
Long term decisions about sewer and water rates should be made by the City Council
of the merged city.
Figure 11 contains the existing water and s,itary sewer user rates for Long Lake and
Orono. This figure also includes estimates of the quarterly cost based on three sample
levels of use.
Figure 11
Current Water and Sewer Rates
With Estimated Costs
Estimated Cost For
Rate Structure
Quarterly
Usage (gal)
@a;g /1.000
Gal.
10.000
20,000
- 30,000
WATER
Orono
Navarre Area
23.25
1.98
43.05
62.85
82.65
Highway 12 Area
8.55
2.74
35.9E
63.35
90.75
Chevy Chase Area
8.55
2.18
30.31
52.15
73.95
Long Lake
Resident
2.25
22.50
45.00
67.50
Non -Resident
2.50
25.00
50.00
75.00
SEWER
Orono
7.10
2.80
35.10
63.10
91.10
Ling Lake
$7.00 min.
3.59
35.90
71.80
107.70
COMBINED
Orono
Navarre Area
78.15
125.95
173.75
Highway 12 Area
71.05
126.45
181.85
Chevy Chase Area
65.45
115.25
165.05
Long Lake
Resident
58.40
116.80
175.20
Non -Resident
60.90
121.80
182.70
32
6. The merged city will assume responsibility for all outstanding debt at the time of
merger.
According to State law, the primary obligation to pay the bonded indebtedness
outstanding on the effective date of merger remains with the city that issued the bonds.
The merged Long Lake/Orono will use the statutory authority to make debt service
payments on the existing debt. This plan includes the ability to levy property taxes for the
payment of bonds on all taxable property in the merged city. A levy for debt service on
existing debt is included in the financial projections for the merger.
Figure 12 contains the debt outstanding in each city as of December 31, 1999.
Figure 12
Existing Debt • 12/31/99
Long Lake
Issue
Dated
Amount
Outstanding
Einall
G.O. Improvement Bonds
6/1/1999
$820,000
$820.000
2/1/2015
Taxable G.O. Tax Increment Bonds
7/1/1987
350,000
100.000
12/1/2004
G.O. Tax Increment Refunding Bonds
5/l/1993
1,345,000
580.000
12/1/2004
$1.500,000
Orono
11%m
Dam
Amount
Outstandina
Etta!
Public Facility Revenue Bonds
12/1/1991
$4,000,000
$2,655,000
2/l/2008
G.O. Sewer Improvements Bonds
8/1/1992
2.0D0,000
1,275,000
2/1/2008
G.O. Improvement Bonds
7/l/1997
1,760.000
1.590.000
2/1/2008
G.0 Improvement Bonds
7/1/1999
1,190,000
1,190,000
2/1/2008
$6,710,000
Both cities have comparable amounts of debt. The total deb' per capita is $783 in Long
Lake and $871 in Orono.
A bond rating is used by local government to attract and inform investors in municipal
bonds. The rating helps the investor assess the financial condition of the issuer and the
financial implications of a specific bond issue.
The general obligation bonds of the Citv of Orono are currently rated "Aa I" by Moody's
Investors Service. The City of Long Lake has not sought a hand rating.
Moody's will assign a rating to the debt of the new merged city. It is a pected that the
Orono Aa3 rating will be applied to this debt.
7 ♦ GOVERNANCE AND IMPLEMENTATION
Governance is a fundamental element of the meager evaluation. Governance sets the
framework for how the merged city will funct on. How will the merge.. city provide for
equitable representation? What can be done to maintain community identity? What is the
name of the merged city?
Closely related to governance is implementation. If merger is the desirable, how does it
happen? This section describes the steps and timetable for the merger.
1. The merged city will operate as a home rule charter city.
One of the core values of the consolidation process was to provide equitable representation
of the citizenry in governance. The Consolidation Committee believes this objective can
best be achieved through a city charter.
There are two optior ' •,r the organization of the merged city. Long Lake and Orono
currently operate as statutory cities. Statutory cities derive all of their powers from State
Law. The alternative is to operate as a home rule charter city.
A charter allows a city to create its own unique form of government. The Committee
found the charter to be an important element of the merger.
• The charter allows the creation of wards. (The rationale for wards is discussed in the
next section.) A statutory city can only establish wards through special legislation.
• A charter gives formal status to the historic districts of Long Lake and Navarre. No
such power exists for statutory cities.
• A charter allows other enduring recognition of Long Lake, including naming the
Volunteer Fire Department.
The Committee drafted a preliminary charter for the merged city (see Appendix Q. With
the exception of use three items listed above, the charter conveys no special powers to the
merged city. The charter is based on the powers given to statutory cities. The Committee
33
34
believes that the home rule charter approach may offer other benefits to the community in
the future.
The cities will seek a waiver from the Board of Government Innovation and Cooperation.
This waiver would allow for approval of the charter in this document as part of the merger
vote. If a waiver is not granted, the cities will follow the traditional statutory process.
Under State Law, the charter is created by a Charter Commission. The District Court
appoints members to the Charter Commission. The city councils will recommend
Commission members to the Court. The Charter requires voter approval to become
effective. The charter for the merged city would he submitted to the voters at the
September 12" primary in conjunction with the vote on the merger.
2. The merged city will have a seven -member city council.
The merged city will be divided into four wards. A ward is a defined area from which a
member of the city council is elected. One council member will be elected from each
ward. Two council members and the mayor will be on an at large basis.
The C;zy Charter provides the means for establishing the wards. Without the Charter,
wards cannot be L:tablished without special legislation. All wards must contain
approximately equa' populations. The Committee recommends that the Charter require
that one ward contr.in all of Long Lake. Another ward will contain all of Navarre. These
wards will include other parts of Orono to meet the equal population requirements. The
remainder of Orono will be divided into two wards.
The actual boundaries of the wards will be established by ordinance adopted by the City
Council after the merger. A map of potential city council wards appears in Figure 13.
An essential part of the governance plan is the use of wards. Wards provide a guarantee
that the residents of any ward have a voice on the city council of the merged city. In fact,
the governance plan would allow a majority of the Council to be elected from any one of
the four wards.
Although the City Chatter will be voted on in September, the ward system cannot take
effect until after the merger occurs. In 2001, the merged city will operate with a ten
member city council. Existing Long Lake and Orono council members with remaining
terms in office will be combined with those elected in 2000. A special election will be held
in November, 2001 to elect the first seven -member city council using the new ward
system.
Initially, two wards and one at large Council position will be elected to a one year term.
The remaining wards, one at large Council position and the mavor will be elected to three
year terms. After the initial election, all terms will be for four vears.
35
Figure 13
Proposed City Council Wards
I _
Ward 3
( t�
ward 1
i
Ward 2
y.
and 4
3. The merged city will establish an economic development authority
State Law gives cities the ahility to establish economic development authorities (EDA). An
EDA gives the city additional powers fur develtivrnent and redevelopment needs. Laing
Lake has created an EDA. The Long Lake EDA plats a role in the City's redevelopment
efforts and its use of tax increment financing
Orono has created a housing and rede%olupment authority (HRA) The Urono HRA has
not been used for development purposes. The HRA was used as a vehicle to finance the
mumapal building.
0.
The use of an EDA in the merged city meets immediate and long term needs. Initially, the
EDA allows for the continuation of existing programs. Going forward as a merged city, the
EDA provides tools for addressing development issues, particularly in the redevelopment of
Long lake and Navarre.
The Committee makes the following recommendations concerning the EDA:
• The board of commissioners of the EDA should initially be the City Council. This
approach simplifies the transition into a merged city. Over time, the Council could
change the membership to include non -Council representation.
• The EDA will be given administration of the existing tax increment financing districts
in Long Lake.
• The EDA will be designated as the housing and redevelopment authority for the city.
This step continues the financing structure for the municipal building bonds. These
bonds will be retired in 2008.
4. Other boards and committees will be appointed for a one-year transition period.
Both cities have established advisory committees, most notably a Planning Commission. As
with the City Council, the membership of the Planning Commission will be combined
following the referendum and through 2000. During 2000, the City Council will set the
size and makeup of the planning commission for the merged city. Appointments to the
new planning commission will be made in 2001. A similar approach will be used for other
boards and committees.
5. The legal name of the merged city will be "Orono".
The Consolidation Committee considered a variety of options for the legal name of the
merged community. Orono emerged as the preferred name. The Committee's decision
was based on several factors:
• Orono is older. The Town of Orono was established in 1889. The City of Long Lake
was incorporated in 1906.
• It is important to maintain the existing and historical identity of the community. A
new name is not acceptable.
• Use of Orono is consistent with the name of the school district
• A combination of city names, such as Long lake Orono, is too cumbersome
37
• The use of the City Charter to create a formally designated Long Lake district
maintains the name and identity.
Postal service did not play a role in the name decision. The community is currently served
by seven post offices. The merger of Long Lake and Orono will not change postal service or
mailing addresses.
6. A referendum on the proposed merger will be held at the primary election on
September 12, 2000.
State Law requires a referendum on the merger. The merger must be approved by separate
majority votes in each city. The merger proposal will be submitted to the voters on
September 12. The Committee believes that this timing is essential.
• The merger issue must be decided as soon as possible. The existence of one city or
two influences many different issues. The primary is the earliest opportunity to
schedule an election.
• A regularly scheduled election avoids the cost of a special election.
• Seats on both Long Lake and Orono city councils will be elected in 2000. The Board
of Government Innovation and Cooperation will be asked to extend the candidate
filing period to a date after the primary election. This timing allows candidates to file
for office knowing the results of merger. If this waiver is not granted, candidates will
file under normal timing prior to the referendum with the knowledge that the term of
office and jurisdiction may change.
• The September election allows over three months to prepare for the effective date of
the merger, including the adoption of an operating budget for 2001. The November
general election would not leave adequate preparation time. With a November
election, the effective date of the merger would be delayed until later in 2001.
7. If approved by the voters, the merger would take effect on January 1, 2001.
The Consolidation Committee considered several options for an effective date. The
Committee found the January 1, 2001 to have the greatest advantage.
• As noted above, a reasonable period of time is allowed after the election to prepare for
the actual merger.
• The merger takes place at the beginning of a fiscal year, minimizing the accounting and
financial reporting issues related to the merger.
38
Not all activities needed to convert from two cities will be accomplished by December 31.
A discussion of implementation action that will occur in 2001 follows later in this section.
8. Approval of the merger plan will occur in June, 2000.
The merger plan was approved by the Consolidation Committee on May 25, 2000. The
merger plan will be submitted to each City Council for review and consideration. State
Law requires the following actions to approve the plan and schedule a referendum:
• The merger plan must be adopted by resolution of each city council.
• Without a Board of Government Innovation and Cooperation waiver, the city council
initiate the process to establish a Charter Commission and create a charter for the
merged city.
• The merger plan must be submitted to the Board of Government Innovation and
Cooperation for review and approval prior to scheduling the election. The
implementation schedule calls for the plan to be submitted to the Board on or before
June 20. If the Board approves the plan before June 30, the merged city will be
eligible for Cooperation Aid in fiscal year 2001.
• The plan must also be submitted to the Metropolitan Council for review and
comment. State Law does not give the Metropolitan Council power of approval.
• Each city council shall publish at least a summary of the adopted plans, each significant
modification and resolution of items, and, if appropriate, the results of Board of
Government Innovation and Cooperation and Metropolitan Council review and
comment.
• All approvals of the merger plan must occur before July 28, 2000. The ballot question
for the referendum and the city charter must be provided to Hennepin County by this
date (not less than 45 days prior to the election).
9. After the election, the two cities will operate under a plan of cooperation.
The implementation plan creates a governance gap between the election and the effective
date of the merger. The Consolidation Committee recommends that the creation of an
"interim governing body" as authorized in the Merger Statute. This interim governing body
would be a combination of the existing Long Lake and Orono city councils. The interim
governing body can exercise all statutory authority of the city council of the merged city,
including the authority to enter into contrcts and adopt policies and local ordinances.
WE
This approach allows the cities to work jointly towards implementing the merger. Actions
needed prepare for the effective date could be dealt with as part of regular council
meetings. All actions would be taken jointly. The opportunity for miscommunication and
misunderstanding arising from separate council meetings would be eliminated.
10. Two track budgeting will be required for 2001.
The process of preparing the operating budgets for 2001 will begin before the outcome of
the merger vote is known. The budgeting process must anticipate both merged and
separate possibilities. Specific elements of the budgeting process will include:
• Coordination with the Department of Revenue concerning Local Government Aid and
levy limit calculations.
• Coordination with Hennepin County on property tax calculations and property owner
notifications.
• Assistance of Board of Government Innovation and Cooperation to waive procedural
requirements affected by the merger process.
11. A variety of implementation actions wiL' occur in 2001.
The focus of the interim period from the election through December 31 will be on the
tasks that must be accomplished to become a single city. More long term implementation
tasks will occur in 2001. The list of these implementation tasks include:
• Creation of new zoning ordinance.
• Recodification of all other city ordinances.
• Creation of comprehensive plan for the merged city.
• Remodeling of Orono municipal facilities and relocation of Long Lake operations.
• Evaluation and implementation of utility interconnections and services.
• Evaluation of city-wide storm water utility.
APPENDIX A - MERGER STATUTE
465.81 Cooperation and combination.
Subdivision 1. Scope. Sections 465.81 to 465.87 establish procedures to be used by
counties, cities, or towns that adopt by resolution an agreement providing a plan to provide
combined services during an initial cooperation period that may not exceed two years and
then:
(1) to merge into a single unit of government over the succeeding two-year period; or
(2) to agree to apportion the entire area of at least one local government unit between
or among two or more local government units contiguous to the unit to be
apportioned, resulting in the elimination of at least one local government unit over
the succeeding two years.
Subd. 2. Definitions. As used in sections 465.81 to 465.87, the words defined in
this subdivision have the meanings given them in this subdivision.
"Board" means the board of government innovation and cooperation.
"City" means home rule charter or statutory cities.
"Governing body" means, in the case of a county, the county board; in the case of a
city, the city council; and, in the case of a town, the town board.
"Local government unit" or "unit" includes counties, cities, and towns.
Subd. 3. Combination requirements. Counties may combine with one or more other
counties. Cities may combine with one or more other cities or with one or more towns.
Towns may combine with one or more other towns or with one or more cities. Units that
combine must be contiguous. A county, through the adoption of a resolution by all county
boards that are affected by the combination, may apportion its territory between or among
two or more counties contiguous to the county that is to be apportioned. A city, through
the adoption of a resolution by all city councils that are affected by the combination, may
apportion its territory between or among two or more cities contiguous to the city that is to
FF
A-2
be apportioned. A township, through the adoption of a resolution by all town boards or
city councils that are affected by the combination, may apportion its territory between or
among two or more townships or cities contiguous to the township that is to be
apportioned.
465.82 Cooperation and combination plan.
Subdivision I. Adoption and state agency revie,. Each governing body that proposes
to take part in a combination under sections 465.81 to 465.87 must by resolution adopt a
plan for cooperation and combination. The plan must address each item in this section.
The plan must be specific for any item that will occur within three years and may be
general or set forth alternative proposals for an item that will occur more than three years
in the future. The plan must be submitted to the board of government innovation and
cooperation for review and comment. For a metropolitan area local government unit, the
plan must also be submitted to the metropolitan council for review and comment. The
council may point out any resources or technical assistance it may be able to provide a
governing body submitting a plan under this subdivision. Significant modifications and
specific resolutions of items must be submitted to the board and council. if appropriate, for
review and comment. In the official newspaper of each local governmeu •mit proposing to
take part in the combination, the governing body shall publish at least a summary of the
adopted plans, each significant modification and resolution of items, and, if appropriate,
the results of each board and council review and comment. If a territory of a unit is to be
apportioned between or among two or more units contiguous to the unit that is to be
apportioned, the plan must specify the area that will become a part of each remaining unit.
Subd. 2. Contents of plan. The plan must state:
(1) the specific cooperative activities the units will engage in during the first two
years of the venture;
(2) the steps to be taken to effect the merger of the governmental units, with
completion no later than four years after the process begins;
(3) the steps by which a single governing body will be created or, when the entire
territory of a unit will be apportioned between or among two or more units
contiguous to the unit that is to be apportioned, the steps to be taken by the
governing bodies of the remaining units to provide for representation of the
residents of the apportioned unit;
(4) changes in services provided, facilities used, and administrative operations and
staffing required to effect the preliminary cooperative activities and the final
merger, and a two-, five-, and ten-year projection of expenditures for each unit if
it combined and if it remained separate;
A-3
(5) treatment of employees of the merginc governmental units, specifically including
provisions for reassigning employees, dealing with exclusive representatives, and
providing financial incentives to encourage early retirements;
(6) financial arrangements for the merger, specifically including responsibility for
debt service or outstanding obligations of the merging units;
(7) one- and two-year impact analyses, prepared by the granting state agency at the
request of the local government unit, of major state aid revenues received for each
unit if it combined and if it remained separate, including an impact analysis,
prepared by the department of revenue, of any property tax revenue implications
:associated with tax increment financing districts and fiscal disparities under
chapter 276A or 473F resulting from the merger;
(8) procedures for a referendum to be held before the proposed combination to
approve combining the local government units, specifically stating whether a
majority of those voting in each list. ;t proposed for combination or a majority of
those voting on the question in the entire area proposed for combination is
needed to pass the referendum; and
(9) a time schedule for implementation.
Notwithstanding clause (3) or any other law to the contrary, all current members of
the governing bodies of the local government units that propose to combine under sections
465.81 to 465.88 may serve on the initial governing body of the combined unit until a
gradual reduction in membership is achieved by foregoing election of new members when
terms expire until the number permitted by other law is reached.
Subd. 3. Interim governing body. The plan for cooperation and combination
adopted in accordance with subdivision 1 may establish an interim governing body to act on
!+ehalf of the new local government unit before the effective date of the combination. If
established, the interim governing body must consist of at least a majority of the elected
officials from each local government unit taking part in the combination. If the plan
establishes an interim governing body, ti. , governing body of each unit taking part in the
combination shall appoint its representatives to serve on the interim governing body. An
interim governing body may not take any official action on behalf of the new local
government unit before approval of the combination through the referendum required by
section 465.84. After ap: oval of the combination through the referendum, and before the
effective date of the combination, an interim governing; body may exercise all statutory
authority of the gc eming body of the new local government unit, including the authority
to enter into contracts and adopt policies and local ordinances.
A-4
465.83 State agency approval
Before scheduling a referendum on the question of combining local government units
under section 465.84, the units shall submit the plan adopted under section 465.82 to the
board. Metropolitan area units shall also submit the plan to the metropolitan 'ouncil for
review and comment. The board may require any information it deems necessary to
evaluate the plan. The board shall disapprove the proposed combination if it finds that the
plan is not reasonably likely to enable the combined unit to provide services in a more
efficient or less costly manner than the separate units would provide them, or if the plans
or plan modification are incomplete. If the combination of local government units is
approved by the board under this section, the local units are not required to proceed under
chapter 414 to accomplish the combination.
465.84 Referendum.
During the first or second year of cooperation, and after approval of the plan by the
board under section 465.83, a referendum on the question of combination must be
conducted. The referendum must be on a date called by the governing bodies of the units
that propose to combine. The referendum must be conducted according to the Minnesota
Election taw, as defined in section 200.01. If the referendum fails, the same question or a
modified question may be submitted the following year If the referendum fails again, the
same question may not be submitted. Referendums shall be conducted on the same date in
all local government units.
465.85 County auditor to prepare plat
Upon the request of two or more local government units that have adopted a
resolution to cooperate and combine, the county auditor shal! prepare a plat. If the
proposed combined local government unit is located in more than one county, the request
must be submitted to the county auditor of the county that has the greatest land area in the
proposed district. The plat must show:
(1) the boundaries of each of the present units;
(2) the boundaries of the proposed unit;
(3) the boundaries of proposed election districts, if requested, and
(4) other information deemed pertinent by the governing bo, •s or the county
auditor.
A 5
465.86 Bonded debt at the time of combination.
Debt service for bonds outstanding at the time of the combination may be levied by
the combined governing body consistent with the plan adopted according to section
465.82, and any subsegi,�it modifications, subject to section 475.61. The primary
obligation to pay the bonded indebtedness outstanding on the effective date of combination
remains with the local government unit that issued the bonds, but a combined unit may
make debt service payments on behalf of a preexisting unit.
APPENDIX B • FINANCIAL ASSUMPTIONS
State Impact Analyses (Statutory Factor #7)
The Department of Revenue developed a comparison of the 1999 and 2000 actual and
hypothetical local givernment aid (LGA) and homestead and agricultural credit aid
(HACA) for the cities. The hypothetical amounts assume that the cities were consolidated
when the 1999 and 2000 aid determinations were made (see Figure 14). It should be noted
that the 2001 aid will be determined in July, 2000 and will reflect the separate status of
the cities at that time The January I, 2001 consolidation will be first reflected in the 2002
aid determinations.
Figure 14
LGA and HACA Estimates
Minnesota Department of Revenue
Aid Year 1999
Aid Year 2000
LGA
Actual $77,856 $0 $77,856 $81,140 $9,277 $90,417
Hypothetical $49,633 $61,247
HACA
Actual $162,588 x")2,528 $465,116
Hypothetical $465,116
Total Aid
Actual $240,444 $302,528 $542,972
Hypothetical $514,749
$165,017 5309,551 $474,568
$474,568
$246,157 $318,828 $564,985
$535,815
(The figures above deal only with two forms of state aid. The merged city will gain in aid
for street maintenance and construction and for implementation of the merger.)
B - I
8.2
The LGA decrease results primarily from the impact of the consolidation on the
"population decline percentage" and the "commercial/industrial percentage" factors used in
determining LGA. HACA does not change under the consolidation.
Police aid is a function of the number of police officers employed and the number of
months they worked in a year. The greater the number of "police officer months" worked
the greater the aid. For aid payment year 1998, the aid per "police officer month"
amounted to $505.68. For 1999, it amounted to $499.49.Orono received $95,206 in 1998
police aid relative to 192 "police officer months' worked in 1997. It received $98,400 in
1999 police aid relative to 197 "police officer months" worked in 1998. Long Lake does not
have its own police department and therefore does not receive any police aid.
For taxes payable in 2000 Hennepin County reports show four Long Lake tax increment
financing (TIF) districts receiving tax increments and none in Orono. Three of the Long
Lake TIF districts (Downtown, Downtown Modified and District 2) were established
before the TIF original tax rate provision became effective. These tax increments are
affected by increases and decreases in the total local tax rate. As a result, these tax
increments can be affected by the proposed consolidation. The impact relates to the
difference in the total local tax rate in Long Lake with and without consolidation.
The fourth Long Lake TIF district (District 1-4) was established after the TIF original tax
rate pr. ision became effective. Its original local tax rate is 131.302%. If the total local tax
rate in Long Lake is less than 131.302%, the tax increment for the TIF district is based on
the lower tax rate. If the total local tax rate is greater than 131.302%, the tax increment is
based on 131.302%. As a result, the proposed consolidation can also affect the tax
increments of this TIF district. The impact relates to the difference between the 131.302%
original local tax rate and the total local tax rate in Long Lake with and without
consolidation.
Additional information on tax increment financing appears in Section 3.
The Department of Revenue did not provided any estimates on the changes in fiscal
disparities funding.
It is important to note that two variables determine the property tax impacts of city
government: (1) the amount of tax revenues needed and (2) the taxable value of property.
The cities determine the amount of tax revenues needed to operate city government.
There is no local control over the valuation of property. Property values are set by the
assessor and by the State Legislature.
To evaluate impli,ations of merger, future property tax revenues are projected on the basis
of a balanced budget. Operating expenses and revenues from all other sources are
R-3
projected for the ten year period. Subtracting other revenues from expenses determines
the amount of tax revenues needed in each year.
The property tax rate is calculated by dividing the tax revenues amount by the projected
net tax capacity (taxable) value of the city. The Committee's projections assume that the
total net tax capacity value of property increases at an annual rate of 2%. This growth
factor should prove conservative. The continuation of recent development trends will add
property value at a faster rate. The projected property values also account for the
estimated loss of property from the reconstruction of Highway 12.
The ability to benefit from this growth is controlled by the State Legislature. For three
consecutive years, the Legislature has reduced the rates for converting market value to
taxable value. The State Legislature will consideration "reform" of the property tax system
in the 2001 Session. The proposed changes will include additional rate reductions. These
reductions mean that community growth does not result in comparable increases in tax
base. Future legislative changes in the property tax system cannot be anticipated in the
financial projections for the merger.
Other Assumptions
Assumptions used in the financial projections not previously explained include the
following.
Service Charges
The projections deduct the revenues rrceivea from fire and police service contracts. As a
merged city, Long Lake no longer pays for ponce service and Orono will not pay Long Lake
for fire protection. All other service charge revenues are assumed to increase by 3%
annually.
vmer t_ocai xevenues
The financial projections assume that revenues from other local sources will increase by 3%
per year. The primary sources of other local revenues include license and permit fees,
Pines, and interest income.
Expenditures
The projected expenditures begin with the 2000 budget for each city. An annual inflation
factor of 3% is used to project expenditures into the future
MerJie
The base year 2000 budget for the merged city combined the budgeted expenditures
subject to the following savings:
B-4
Elimination of fire service contract payments made by Orono to Long Lake
($125,000).
• Elimination of police service contract payments made by Long Lake to Orono
($266,928).
• Reduction in administrative expenses due to elimination of duplication. Primary
savings come in areas of City Council, elections, legal, building maintenance, planning,
and accounting ($72,295).
• Reduction in capital outlay ($30,000).
• Reduction in special services and projects ($30,000)
The Committee believes these savings to be conservative. Instead of pushing for a larger
reduction in expenses, the Committee chose to maintain a buffer against unanticipated
expenses.
No Merger
The Services section of the report discusses the additional staffing required in Orono if the
merger does not occur. The financial projections include the new staff with wages based on
the City's salary structure plus 35% for benefits. No new staff positiuns are proposed in
Long Lake during this ten-year period.
APPENDIX C - DRAFT CITY CHARTER
City of Orono
Home Rule Charter
Table of Contents
Chapter I
Names, Boundaries, Powers, and General Provisions
Section 1.0! .
Name and Boundaries ...............................
C - 1
Section 1.02.
Powers of the City .................................
C - 1
Chapter 2
Form of Government
Section 2.01.
Form of Government ......................... .....
C - 2
Section 2.02.
Boards and Commissions ............................
C - 2
Section 2.03.
Elective Officers ...................................
C - 2
Section 2.04.
Incompatible Offices ...............................
C - 3
Section 2.05.
Vacancies in the Council .............................
C - 3
Section 2.06.
The Mayor .......................................
C -3
Section 2.07.
Salaries ...........................................
C - 4
Section 2.08.
Investigation of City Affairs ..........................
C - 4
Chapter 3
Procedure of
Council
Section 3.01.
Council Meetings ..................................
C - 5
Section 3.02.
Secretary of council ................................
C - 5
Section 3.03.
Rules of Procedure and Quorum .......................
C - 5
Section 3.04.
Ordinances, Resolutions and Motions ...................
C - 5
Section 3.05.
Procedure on Ordinances ............................
C - 5
Section 3.06.
Emergency Ordinances ..............................
C - 5
Section 3.07.
Procedure on Resolutions ............................
C - 6
Section 3.08.
Signing and Publication of Ordinances and Resolutions .....
C - 6
Section 3.09.
When Ordinances and Resolutions Take Effect ...........
C - 6
Section 3.10.
Amendment and Repeal of Ordinances .................
C - 6
Section 3.11
Revision and Codification of Ordinances ................
C - 6
C-+
C-ii
Chapter 4
Nominations and Elections
Section 4.01. The Regular Municipal Election .......................
C - 7
Section 4.02. Candidates Filing ..................................
C - 7
Section 4.03. Special Elections ...................................
C - 7
Section 4.04. Procedure at Elections ..............................
C - 7
Section 4.05. Non -partisan Elections ..............................
C - 7
Chapter 5
Recognition of Historical Origins
Section 5.01. Historical Origins ...................................
C - 8
Chapter 6
Administration of City Affairs
Section 6.01. Administrative Organization . .........................
C - 9
Section 6.02. Subordinate Officers ................................
C -9
Chapter 7
Taxation and Finances
Section 7.01. Council to Control Finances ........................
C - 10
Section 7.02. Fiscal Years .................. ...................
C - 10
Section 7.03. System of Taxation ................................
C - 10
Section 7.04. Preparation of the Annual Budget .....................
C - 10
Section 7.05. Passage of the Budget ..............................
C -10
Section 7.06. Disbursements ...................................
C - 10
Section 7.07. Tax Anticipation Certificates ........................
C - 10
Chapter 8
Public Improvements and Special Assessments
Section 8.01. Power to Make Improvements and levy Assessments .....
C - 11
Section 8.02. Assessments for Services ............................
C - 11
Section 8.03. local Improvement Procedures ......................
C - 11
Chapter 9
Property Acquisition
Section 9.01. Power to Acquire Property ..........................
C - 12
Chapter 10
Franchises
Section 10.01. Franchises Required ..............................
C - 13
Section 10.02. Public Hearing ................ .................
C - 13
Section 10.03. Term ........................... ..............
C -13
Chapter I I
Public Ownership and Operation of Utilities
Section 11.01. Acquisition and Operation of Utilities ...........
... C - 14
Section 11.02. Rates and Finances ...............................
C .14
Section 11.03. Purchase in Bulk .................................
C -14
Section 11.04. Lease of Plant .............................. ....
C - 14
Section 11.05. Sale of Public Utility .................... .. _ .....
C - 14
Chapter 12
General Provisions
Section 12.01.
Official Publications ..............................
C - 15
Section 12.02.
Oath of Office ..................................
C - 15
Section 12.03.
Official Interest in Contracts .......................
C - 15
Section 12.04.
Official Bonds ...................................
C - 15
Section 12.05.
Sales of Real Property .............................
C - 15
Section 12.06.
Vacation of Streets ...............................
C - 15
Section 12.07.
City to Succeed to Rights and Obligations of Former Cities.
.......................................................
C -16
Section 12.08.
Statutes Not Affected by Charter ....................
C - 16
Section 12.09.
Existing Ordinances Continued .....................
C - 16
Section 12.10.
Ordinances to Make Charter Effective ................
C - 16
Section 12.11.
Effective Date, Status .............................
C - 16
Section 12.12.
Fines and Penalties ...............................
C - 16
Charter History
1. Adoption
................................................
C -17
11. Amendments ............................................
C- 17
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Chapter 1
Names, Boundaries, Powers, and General Provisions
Section 1.01. Name and Boundaries.
The cities of Orono and Long Lake, in the
county of Hennepin, and state of
Minnesota, shall, upon the adoption of
this charter, become one municipal
cororation under the name of the city of
Orono, with the boundaries established
by combining the two cities, or as may be
changed in the future.
Section 1.02. Powers of the City. The
city shall have all powers which may now
or in the future be possible for a
municipal corporation in this state to
exercise in harmony with the
constitutions of this state and the United
States. It is the intention of this section
to confer upon the city every power that
it would have if the power were
specifically mentioned. These powers
shall include the general power to
preserve, promote, and protect the
health, safety, order, convenience, and
general welfare of the city. The charter
shall be construed liberally in favor of the
city, and the specific mention of
particular powers in the charter does not
limit the powers of the city to those so
mentioned.
Chapter 2
Form of Government
Section 2.01. Form of Government.
Unless granted to some other officer or
body, all powers are vested in the city
council, which will be structured in
accordance with this chapter.
Section 2.02. Boards and Commissions.
There shall be no separately elected board
of health, library board, park board, or
other administrative board or commission,
except for the administration of a
function jointly with another political
subdivision. Except as it may provide
otherwise, the council shall be, and
exercise the powers of, such boards and
commissions provided for by statute. The
council may, however, establish boards or
commissions to advise the council with
respect to any municipal activity, to
investigate any subject of interest to the
city, or to perform quasi-judicial
functions.
Section 2.03. Elective Officers.
a. The council shall consist of a mayor
and six council members. To qualify for
elective office, a person must be eligible
to vote in the State of Minnesota, be
registered to vote in the city, and be a
resident of the city. In addition, a person
elected to represent a particular ward
must reside in that v. ard. The mayor and
each council membe, shall serve for a
term of four years or until a successor is
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elected and qualifies. All terms shall
commence on the first business day of
January following the date of the officer's
election.
b. The mayor and two council members
shall be elected at large, and four council
members shall be elected by wards, one
from each of four separate wards. The
two at -large council offices shall be
designated as council member -at -large,
seat A and seat B.
The bou.daries of the wards shall be
established by the council by ordinance.
To the extent that it is practical and
permitted by law, one ward must contain
all, or as much as reasonably possible, of
the area that was formerly the city of
Long Lake. To the extent that it is
practical and permitted by law, another
ward must contain all, or as much as
reasonably possible, of the area
historically known as Navarre. Each ward
shall be compact and contiguous. The
population of each ward shall not be five
percent greater nor five percent less than
the number created by dividing the
population of the city as determined in
the last federal census by the number
four. If a federal census discloses that the
Fopulation of any ward no longer meets
this requirement, the council shall change
the ward boundaries to achieve
complianct, within the time period
required by state law. Notwithstanding
the requirement of ward residency, if
redisuicting removes the residence of a
sitting ward council member from the
applicable ward, the council member shall
continue in office until the next general
municipal election. At that time, the
office shall be filled either by the
normally scheduled election for that
position or by a special election for a two-
year term.
c. All regular municipal elections shall
be held in even -numbered years. The
council members from wards 1 and 3 and
the council member -at -large, seat A, shall
be elected to a term of one year each in
2001 and to a term of four years each in
2002 and in subsequent years. The
mayor, the council members from wards
2 and 4, and the council member -at -large,
seat 8, shall be elected to a term of three
years each in 2001 and to a term of four
years each in 2004 and subsequent years.
Section 2.04. Incompatible Offices. No
member of the council shall hold any
other paid office or employment with the
city, even if that person has taken a leave
of absence from the office or
employment. Until one year after the
termination of the person's service as
mayor or council member, no former
member shall be appointed to any paid
appointive office or employment with the
city which was created or the
compensation for which was increased
during the person's term in the elective
office. This section does not prohibit the
appointment of a council member to fill a
vacancy in the office of mavor.
Section 2.05. Vacancies in the Council.
A vacancy in a co mcil position is deemed
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to exist on .he date that the incumbent
dies or submits a written resignation to
the city clerk. A vacancy in a council
position also exists in the following
situations: failure of any elected person
to qualify on or before the date of the
second regular meeting after the person's
term of office begins, removal from
office, removal of residence from the city,
removal of residence of a ward council
member from the ward from which
elected except by redistricting,
continuous absence from the city for
more than three months, conviction of a
felonv whether before or after
qualification, loss of qualifications for
elective office, loss of competency as
adjudged by a court or competent
jt:•;sdiction, or performance of none of
the duties of membership in the council
without good cause for a period of three
months. In the situations that do not
involve dtnth or resignation, .he council
shall on its own motion declare by
resolution that a vacancy exists and shall
promptly appoint an eligible person to fill
the vacancy for the remainder of the
unexpired term.
Section 2.06. The Mayor. The mayor
shall preside at meetings of the council
and shall have a vote as a member. The
council shall choose from its members a
person to serve as acting mayor in the
mavor's absence or disability and who
shall hold this position at the pleasure of
the council. The mavor shall exercise all
powers and perform all duties conferred
upon that office by this thane-, city
ordinances, and state laws, but shall have
no administrative duties The mayor shall
be recognized as the ofh.ial head of the
Jtv for all ceremonial purposes, by the
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courts for the purpose of serving civil
process, and by the governor for the
purpose of martial law. In time of public
danger or emergency the mayor may, with
the consent of the council, take command
of the police, maintain order and enforce
the law.
Section 2.07. Salaries. The mayor and
council members shall receive the
compensation established by the council
in accordance with law. All subordinate
officers and employees of the city shall
receive compensation approved by the
council. This compensation may include
the provision of non -monetary benefits.
Section 2.08. Investigation of City
Affairs. The council may make
investigations into the city's business, to
subpoena witnesses, administer oaths,
take testimony, and compel the
production of evidence. The council shall
provide for an audit of the city's accounts
at least once a year by the state
department in charge of such work or by a
certified public accountant. The council
may at any time authorize an examination
or audit of the accounts of a city officer or
department and may initiate a survey or
research study of any subject of municipal
concern.
Section 2.09. Interferences with
Adm;--'stration. No single member of the
council or group of council members less
than a majority shall give an order to any
subordinate officer or employee of the
city.
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Chapter 3
Procedure of Council
Section 3.01. Council Meetings. The
council shall meet regularly at least once
each month at such times and places as
the council may designate. The mayor or
any three members of the council may
call special and emergency meetings of
the council upon compliance with the
requirements of state law regarding public
meetings. Notice of the meetings shall be
delivered personally to each council
member or shall be left at the member s
usual place of residence within the time
periods required by state law for public
notice. All meetings of the council shall
be pub'. except as otherwise permitted
by state law, and any person shall have
access to the minutes and records of those
meetings at all reasonable times.
Section 3.02. Secretary of council. The
cirw clerk shall act as secretary of the
council, keep minutes of council
proceedings, and perform other duties
required by this charter or the council.
Thr council may designate any other city
official or employee, except a member of
the council, to act as secretary of the
council.
Section 3.03. Rules of Procedure and
Quorum. The council shall determine its
own rules and order of business. A
majority of all members shall constitute a
quorum to do business, but a smaller
number may adjourn from time to time.
The council may by rule provide a means
by which a minority may compel the
attendance of absent members.
Section 3.04. Ordinances, Resolutions
and Motions. Except as this charter
provides otherwise, all legislation shall be
by ordinance. All administrative business
may be transacted by motion. The votes
on any action shall be recorded unless the
vote is unanimous.
Section 3.05. Procedure on Ordinances.
Every ordinance shall be presented in
writing. No ordinance shall contain more
than one subject which shall be clearly
expressed in its title. The enacting clause
of all ordinances shall be in the words,
"The City of Orono ordains." An
affirmative vote of a majority of all the
members of the council is required for
the passage of all ordinances, except as
otherwise provided in this charter o, state
law.
Section 3.06. Emergency Ordinances.
An emergency ordinance is an ordinance
necessary for the immediate preservation
of the public peace, health, morals, safety
or welfare It shall contain a preamble
which defines and declares the emergency
and be adopted by a vote of at least five
members of the council. No prosecution
shall be based upon an emergency
ordinance until 24 hours after the
ordinance has been filed with the city
clerk and either posted in three
conspicuous daces or published at leas•.
once in the official newspaper, unless the
person charged had actual notice of the
passage of the ordinance before the
alleged violation. Every emergency
ordinance shall automatically be repealed
on the 61st day after the date on which it
was adopted, but this shall not prevent
reenactment of the ordinance in the
manner specified in this section if the
emergency still exists.
Section 3.07. Procedure on Resolutions.
Every resolution shall be presented in
writing before being voted upon.
Section 3.08. Signing and Publication of
Ordinances and Resolutions. Every
ordinance or resolution passed by the
council shall be signed by the mayor or
other council member authorized under
Section 2.06 to act as the mayor, and shall
be attested to, filed and preserved by the
city clerk. Every ordinance shall be
published at least once in the official
newspaper. The city council may by a
two-thirds vote of its members direct
publication of only the title and a
summary of an ordinance. This may be
done only if the council approves the text
of the summary and determines that it
wnuld clearly inform the public of the
intent and effect of the ordinance The
summary shall comply with the
requirements of state law and shall give
notice that a full copy of the ordinance is
available for inspection during regular
office hours at the city clerk's office.
Section 3.09. When Ordinances and
Resolutions Take Effect. Every
ordinance and resolution shall take effect
immediately upon its passage or at a later
date stated in it.
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Section 3.10. Amendment and Repeal of
Ordinances. Every ordinance repealing a
previous ordinance or part of an ordinance
shall give the title and any number of the
ordinance to be repealed in whole or in
part. No ordinance or part of an
ordinance shall be amended by reference
to the title alone, and each amending
ordinance shall set forth in full each
section or subdivision to be amended with
appropriate type or symbols for matter to
be omitted or added.
Section 3.11. Revision and Codification
of Ordinances. All ordinances of general
and permanent application shall be
arranged in a code of city ordinances, in a
logical order, with assigned chapter and
section numbers. The ordinance code
shall be printed and maintained in a form
which allows continuous revision. Each
amendment to the code shall be
incorporated into it as soon as practicable
after adoption. Copies of the code of
ordinances shall be made available at the
city clerk's office for general distribution
to the public free or at a reasonable
charge. The code of ordinances may be
recodified when appropriate. An
ordinance provision not previously
published will be valid and effective if the
provision is included in the ordinance
code and if a notice is published in the
official newspaper for at least two
successive weeks stating that copies of the
codification are available at the clerk's
office.
Chapter 4
Nominations and Elections
Section 4.01. The Regular Municipal
Election. A regular municipal election
shall be held on the first Tuesday after
the first Monday in November of each
even -numbered year at places designated
by the city council. The city clerk shall
give at least two weeks' prior notice of the
time and place of holding the election and
of the officers to be elected. The notir-
shall be posted in at least one public place
in each voting precinct and published at
least once in the official newspaper, but
failure to give the notice shall not
invalidate the election.
Section 4.02. Candidates Filing. All
people eligible and desiring to have their
names placed on the official ballot as
candidates for a council office shall file
their affidavits of candidacy with the city
clerk not more than 70 days nor less than
56 days before the first Tuesday after the
second Monday in September preceding
the municipal general election. Each
position on the council is a separate
office. Each person wishing to be a
candidate for a council office must
designate which office is sought. A
person may not be i candidate for more
than ene council office at an election.
The council may establish a nominal
filling fee that must be paid at the time of
filing.
Section 4.03. Special Elections. The
council may by resolution order and
provide for a special election. At least
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three weeks' published notice of a special
election shall be given in the official
newspaper. The procedure at the election
shall conform as nearly as possible to that
prescribed for other municipal elections.
Section 4.04. Procedure at Elections.
Subject to the provisions of this charter
and applicable state laws, the council may
by ordinance further regulate the conduct
of municipal elections. Except as
otherwise provided in this charter or city
ordinance, the general laws of the state of
Minnesota governing elections shall apply
to calling and conducting all municipal
elections.
Section 4.05. Nonpartisan Elections.
Notwithstanding any other provision of
law, all elections for the office of mayor
or council member shall be held on a
nonpartisan basis, with no party
designation on the ballot for such offices.
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Chapter 5
Recognition of Historical Origins
Section 5.01. Historical Origins. To
acknowledge the historical origins of the
new city of Orono, the area that was
formerly the city of Long Lake and the
area historically known as Navarre shall be
recognized as follows:
a. Prominent signs that include the
historical names shall be erected on major
thoroughfares at the entrances into the
areas;
b. Any water towers erected within the
historical areas shall include the historical
names;
c. To the extent permitted by law or
rule, the post offices located within the
historical areas will continue to use the
historical names; and
d. The fire department formerly
operated by the city of Long Lake will
continue to be known as the Long Lake
Volunteer Fire Department.
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Chapter 6
Administra!ion of City Affairs
Section 6.01. Administrative
Organization. The council may by
ordinance establish city departments,
offices, and agencies and prescribe their
functions. No pot. er or duty conferred
by this charter upon a particular office or
agency shall be transferred to any other.
Section 6.02. Subordinate Officers.
There shall be a city clerk, a treasurer,
and such other officers as the council may
establish. The clerk shall be responsible
for the keeping of official city records,
and :he treasurer shall be responsible for
the disbursement of public funds. In
addition, the clerk and treasurer shall
have other powers and duties imposed by
state law, this charter, and city ordinance.
Chapter 7
Taxation and Finances
Section 7.01. Council to Control
Finances. The council shall have full
authority ver the financial affairs of the
city. It shall provide for the collection of
all revenues and other assets, the auditing
and settlement of accounts, and the
safekeeping and disbursement of public
moneys. It shall exercise sound discretion
in paying all liabilities and expenditures.
Section 7.02. Fiscal Years. The fiscal
year of the city shall be the calendar year.
Section 7.03. System of Taxation.
Subject to the state constitution and
applicable state law, the council shall have
full power to provide by ordinance for a
system of local taxation. In the taxation
of real and personal property, the city
shall conform as fully as possible to the
general state law regarding the assessment
of such property and the collection of
taxes.
Section 7.04. Preparation of the Annual
Budget. Annually, the council shall
prepare a proposed annual budget. The
budget shall provide a complete financial
plan for all city funds and activities for
the ensuing fiscal year and, except as
required by law or charter, shall be in the
form the council requires. It shall show
projected revenues and expenditures in
accordance with generally accepted
accounting principles. It shall include
comparisons to the revenues and
expenditures of the prior two fiscal years.
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Section 7.05. Passage of the Budget.
The council shall consider and adopt the
budget in compliance with procedures
established by state law. The council shall
provide a reasonable opportunity for
interested citizens to be heard. The
annual budget finally agreed upon shall set
forth in detail the complete financial plan
of the city for the ensuing fiscal year for
the funds budgeted. It shall indicate the
sums to be raised and from what sources
and the sums to be spent and for what
purposes. The total expenditures shall be
no more than the total estimated
revenues and allocated surplus. A
majority of the council shall adopt the
budget by resolution and shall also by
resolution levy whatever taxes it considers
necessary within statutory limits for the
ensuing year. The tax levy resolution shall
be certified to the county auditor within
the time period required by law.
Section 7.06. Disbursements.
Disbursements shall be made in
accordance with the requirements
applicable to statutory cities.
Section 7.07. Tax Anticipation
Certificates. The council may issue
certificates of indebtedness in anticipation
of the collection of taxes by following the
requirements applicable to statutory
cities.
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Chapter 8
Public Improvements and Special Assessments
Section 8.01. Power to Make
Improvements and Levy Assessments.
The city may make every type of public
improvement not forbidden by state law
and to levy special assessments to pay all
or any pan of the costs which are of a
local character. These special assessments
shall be levied according to the procedure
in state law.
Section 8.02. Assessments for Services.
The council may provide by ordinance
that the cost of removing snow, rubbish or
weeds, any other service to streets,
sidewalks, or other public property, or
any services to other property undertaken
by the city, may be assessed against the
benefitted property and collected like
special assessments.
Section 8.03. Local Improvement
Procedures. When the city undertakes
any local impravement to which state law
applies, it shall comply with the
provisions of that law. The council may
be ordinance prescribe the procedure to
by followed in making any other local
improvement and levying assessments for
them.
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Chapter 9
Property Acquisition
Section 9.01. Power to Acquire
Property. The city may acquire, by
purchase, gift, devise, condemnation, or
other lawful means any property, within
or outside its boundaries, that may be
needed by the city for any public use or
purpose. In acquiring property by
exercising the power of eminent domain,
the city shall proceed according to state
law.
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Chapter 10
Franchises
Section 10.01. Franchises Required.
Except as otherwise provided by law, no
person, firm or corporation shall place or
maintain any permanent or
semipermanent fixtures in, over, upon, or
under any street or public place without a
franchise from the city. A franchise shall
be granted only by ordinance, which shall
not be an emergency ordinance. Every
ordinance granting a franchise shall
contain all the terms and conditions of
the franchise. The grantee shall bear the
costs of publication of the franchise
ordinance and shall make a sufficient
deposit with the clerk to guarantee
publication before the ordinance is
passed.
Section 10.02. Public Hearing. Before
any franchise ordinance is adopted,
altered, modified, extended or renewed,
the council shall hold a public hearing on
the matter. Notice of the hearing must
be published in the official newspaper not
less than ten days before the date of the
hearing.
Section 10.03. Term. No exclusive or
perpetual franchise shall ever be granted.
No franchise for a term exceeding 20
years shall be effective until approved by
a majority of the voters voting on the
issue.
Chapter 11
Public Ownership and Operation of Utilities
Section 11.01. Acquisition and
Operation of Utilities. The city may own
and operate any public utility or service
for supplying its own needs, those of
other consumers, or both. It may
construct all facilities reasonably needed
for that purpose and may acquire any
existing utility or service properties
needed. The city shall not acquire or
construct any public utility unless the
proposition to acquire or construct has
been incorporated in an ordinance
adopted by the council. The ordinance
shall not be an emergency ordinance.
Section 11.02. Rates and Finances. The
council may fix rates, fares and prices for
municipal utilities and services, but the
rates, fares and prices shall be just and
reasonable. The council may prescribe
the time and the manner in which
payments for all utility services shall be
made, may make other regulations
governing utility services, and may
prescribe penalties for violations of the
regulations.
Section 11.03. Purchase in Bulk. In lieu
of providing for the local production of a
public utility product, the council may
purchase the same in bulk and resell them
to local consumers at such rates as it may
fix.
Section 11.04. Lease of Plant. If the
public interest will be served, the council
may contract with any respor ale person,
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partnership or corporation to operate any
utility owned by the city, upon such
rentals and conditions as it deems
necessary. Such a contract shall be
embodied in and let only by an ordinance
approved by five members of the council.
The ordinance shall not be an emergency
ordinance. In no case shall the contract
be for longer than ten years.
Section 11.05. Sale of Public Utility.
No public utility owned by the city shall
be sold or otherwise disposed of by the
city unless the full terms of sale or other
disposition are embodied in an ordinance
approved by a majority of the voters
voting on the issue at a general or special
election. In the case of a water works or
light plant, any sale, lease, or
abandonment shall also be subject to the
requirements of state law.
Chapter 12
General Provisions
Section 12.01. Official Publications.
The council shall annually at its first
meeting of the year designate a legal
newspaper of general circulation in the
city as its official newspaper. The
newspaper shall be used to publish
ordinances and other matters required by
law to be published as well as such other
matters as the council may deem
appropriate.
Section 12.02. Oath of Office. Every
officer of the city shall, before entering
upon the duties of the office, subscribe to
an oath of office in substantially the
following form: "I do solemnly swear (or
affirm) to support the constitution of the
United States and of the state of
Minnesota and to discharge faithfully the
duties devolving upon me as (mayor,
council member, etc.) of the city of
Orono to the best of my judgment and
ability."
Section 12.03. Official Interest in
Contracts. Except as otherwise
permitted by law, no council member or
other officer who is authorized to take
part in any manner in making any contract
with the city shall voluntarily have a
personal financial interest in the contract,
or personally benefit financially from it.
Section 12.04. Official Bonds. Before
undertaking their official duties, the city
clerk, the city treasurer, and such other
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city officers or employees as required by
ordinance shall each give a corporate
surety bond to the city as security for the
faithful performance of official duties and
the safekeeping of the public funds. The
bonds may be either individual or blanket
bonds in the discretion of the council.
They shall be in an amount approved by
the city cou-cil, approved as to form by
the city attorney, and filed with the city
clerk. The provisions of the state laws
relating to official bonds not inconsistent
with this charter shall be satisfied. The
premiums on the bonds shall be paid by
the city.
Section 12.05. Sales of Real Property.
The proceeds of any sale of real property
shall be used as far as possible to retire
any outstanding indebtedness incurred by
the city in the purchase, construction, or
improvement of the property. If there is
no outstanding indebtedness, the council
may by resolution designate some other
public use for the proceeds.
Section 12.06. Vacation of Streets. The
council may by resolution, vacate all or
part of any street, alley, public grounds, or
public way. No vacation shall be made
unless it appears in the interest of the
public to do so. The vacation may be
made only after published notice and an
opportunity for affected property owners
and public to be heard, and upon such
other terms and procedures established
by the council by ordinance. The notice
must be published in the official
newspaper at least ten days before the
public hearing, but failure to give the
notice or any defects in the notice shall
not invalidate the proceedings. A notice
of the vacation shall be filed with the
proper county officers in accordance with
law.
Section 12.07. City to Succeed to Rights
and Obligations of Former Cities. The
city shall succeed to all the property,
rights, and privileges, and shall be subject
to all legal obligations of the former cities
of Long Lake and Orono.
Section 12.08. Statutes Not Affected by
Charter. All state laws applicable to
cities operating under home rule charters
or to cities of the same class as the city of
Orono operating under home role
charters, which are not inconsistent with
the provisions of this charter, shall apply
to the city of Orono. These state laws
shall be supplementary to the provisions
of this charter.
Section 12.09. Existing Ordinances
Continued. All ordinances and
regulations of the cities of Long Lake and
Orono in force when this charter took
effect, and not inconsistent with its
provisions, are hereby continued in full
force and effect within the respective
boundaries of the former cities until
amended or repealed.
Section 12.10. Ordinances to Make
Charter Effective. The council shall by
ordinance, resolution, or other
appropriate action take such steps as may
be necessary tc make effective the
provisions of this charter.
Section 12.11. Effective Date, Status.
This charter shall take effect January 1,
2001. It shall be a public act and need not
be pleaded or proved in any case.
Section 12.12. Fines and Penalties. The
council may establish by ordinance that a
violation of a city ordinance is either a
misdemeanor or a petty misdemeanor,
punishable in accordance with state law.
In addition, the council may establish by
ordinance a procedure for imposing a civil
penalty not exceeding $2000 for each
violation of a city ordinance. This
procedure must provide an opportunity
for the accused to be heard by a neutral
party, which may be the city council.
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Charter History
1. Adoption
The charter for the city of Orono was
adopted by an election held
11. Amendments