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HomeMy WebLinkAbout11-08-1989 Joint Council and PC Meeting Minutesf MINUTES OF THE JOINT MEETING OF COUNCIL AND PLANNING COMMISSION HELD NOVEMBER 8, 1989 ATTENDANCE 6:20 P.M. The Council and Planning Commission met on the above date with the following members present: Mayor. Gr. abek, Councilmembers Goetten, Nettles, Peterson and Callahan. Planning Commission members Ed Cohen, Edward Brown and Charles Kelley. The following represented the City staff: City Administrator. Bernhardson, Public Works Director, Gerhardson, Police Chief Kilbo, Building and Zoning Administrator Mabusth, Assistant Planning and Zoning Administator. Gaffron, Finance Director. Kuehn, Building Inspector. Oman and City Clerk Hallin. Also present were Carolyn Drude, Ehlers and Associates; David Kroos and Jack Boarman, Boarman and Associates and Rosemary Scheuer from the Laker /Pioneer newspaper. Councilmember Goetten left at 7:30 P.M. Mayor. Gr.abek stated the purpose of tonight's meeting was to discuss the overall issues of a city facility stating that comments were welcome. City Administrator Bernhardson stated that the Building Inspector had prepared a survey of current structures which included code • violations and functional problems. He introduced David Kroos and Jack Boarman. SUMMARY OF COMMENTS /CITY HALL TOUR David Kroos reviewed each of the four facilities visited in the tour.. He stated the intent tonight was to review different quality levels. Starting with South Lake Minnetonka Public Safety which was a very simple and economical building by design of the City. Construction cost was approximately $65.00 per square foot. Champlin was a campus type which included new construction and remodeling of existing buildings. The average construction cost was approximately $63.00 per square foot, if built new the construction costs would be approximately $75 -80.00 per square foot. " Mendota Heights structure was viewed as residential in style. He noted this city budgeted monies for art work and furniture which enhanced the image they wanted to create. Construction cost was approximately $76.24 per square foot. Savage used a lot of wood in the Council Chambers which became the focal point of the structure. Construction cost was approximately $68.00 - $70.00 per square foot. Mayor. Gr.abek asked for opinions from others and the quality of construction they would like to see. Charles Kelley asked if the estimated square footage costs 1 I JOINT MEETING OF COUNCIL AND PLANNING COMMISSION • HELD NOVEMBER 8, 1989 included the furnishings. Kroos stated that $10.00 per square foot for City Hall/Police/Administration would be a good workable estimate for furnishings. Good construction costs for a Public Works facility would be $40- $45.00 per square foot. Councilmember. Callahan asked if these figures included landscaping. Kroos stated this included site grading only. Mayor. Gr.abek stated it was his opinion that a new facility should be in the range of Champlin and Mendota Heights. He stated he would like to see the Council Chambers utilized for a public meeting room and the Police Department should be of quality that will withstand the use of that facility. Stating he felt quality of construction should be in the $80 -85.00 per square foot range. Stating there should be room for future growth. In adddition he would like constuction to accommodate lateral additions and a second story so that is available for expansion in the future. Mayor Grabek asked if anyone disagreed with this opinion. Councilmember Nettles stated he felt the same and was impressed with Champlin's facility. He stated that if the facility is built on Highway 12 it would make a statement of what should be in that area. In addition the construction should be such that • it would withstand wear over. the years. Ed Cohen asked if there was any correlation between city population to city staff size. Kroos stated this can be done, by looking at what the population will be in 1995, 2000 and 2010 and comparing your city with other similar municipalities taking into account different governmental structure and model. Cohen stated if you build, build with 30 to 40 years in mind for a maximum function so that it is not outgrown in 5 years. Jack Boar.man stated he would put together a pro forma of all costs; costs for phone system, moving costs, signage, art work - ever.ything making an extensive list so that everything is identified to put a cost to it regardless of who is responsible for it. Stating this will help you in knowing the amount of funds needed. Mayor. Gr.abek gave direction to the architects and staff to proceed to the next step, to have a facility in the range of $80 -85.00 per square foot and planned space for growth that is appropriate for a city our size. METHOD OF FINANCING Mayor. Gr. abek opened up for discussion the method of financing. Administrator. Bernhardson stated there was financing information • in a memo prepared for Council. Bernhardson stated for discussion, if a facility was to be constructed for $3 2 ` 4- ► • JOINT MEETING OF COUNCIL AND PLANNING COMMISSION HELD NOVEMBER 8, 1989 million we would have enough cash on hand to do that. A second way to do that was to go for general obligation bonds, which would require a referendum and the third way which is addressed in the memo is the lease purchase and a variation of that which is the installment purchase contract. The advantages to those are that if you have the cash that you can make money during 10, 15 or 20 years which you have bonded, you can actually make about a percent or a percent and half on your money in a decreasing amount, if you are bonding at 6 1/2, 7 or 7 1/2% and you are investing at 8 or 8 1/2% so you actually make some money. This would also give you some flexibility with that money, if you have some up and down years you still have money available to you. Edward Brown asked if the building cost $2 1/2 million and the City had $2 1/2 million in a building fund, is there any reason not to take the $2 1/2 million to build the building and not pay any interest. Bernhardson indicated that if you could invest the money at a greater rate than what you are borrowing it does two things, you make money over the life of the bond and secondly it does give you flexibility to borrow from that and pay it back if • you have an economic downturn in two or three years. Mayor. Gr.abek stated this is a philosophical question. If you've got only $2 1/2 or 3 million in cash you need to keep a buffer.. Nettles asked if the amount in our reserves affected the city's bond rating. Carolyn Durde stated that Moody's basic philosophy is "more is better and it should be more than last year. ". Stating it is very difficult to pin them down as to philosophy as to what the fund balance should be. They do not like to see a fund balance lower than the previous year.. They look at everything from a pl anning standpoint. Nettles said assuming that we are going to bond part and pay off part out of the reserves, what would be your suggestion be as to how much of each, would you say 50 - 50 or what. Dur.de stated that we should take a look at other things that the City will be doing, more of an analysis would need to be done to see what you may need money for.. In the overall scheme of things in Minnesota your borrowing ability is relatively flexible, but there is a limited number of things that you can borrow money for.. A new city facilities possibility was brought to Moody's attention prior to the city's AA -1 rating assignment, so this would not be a surpir.se, they are aware that this is coming up. Ed Cohen stated assuming that a site has been selected, is this site paid for.? Gr.abek stated that the only site paid for were the Crystal Bay site and the Orono sewer plant. Cohen asked if a study had been done as to what the City would receive for these sites when sold. Bernhardson stated there is some off set for selling the Crystal Bay site and part of the sewer plant site. Kelley stated that leasing makes more sense, but it is hard to tell without more economic information. One of the attractions if -, JOINT MEETING OF COUNCIL AND PLANNING COMMISSION • HELD NOVEMBER 8, 1989 of leasing is that you do not have to go for a referendum but that makes me uncomfortable because it sounds like we are trying to slip around the public. Grabek stated we can offset that by giving them information at public meetings. Grabek agr.eeded this will be one of the most difficult decisions the City has to make. Stating that he had not talked to anyone who doesn't realize the need for a facility. I think if you put it on a referendum and talk about it as a normal course of business and is explained to the public how it is going to be paid for, once we decide, where the building is going to be, and what it will look like and give them enough opportunities to come and talk to us they will come to understand that what we are trying to put here is prudent and it is the responsibility of a city government. I think to make a decision the Council should be given a number of different alternatives for financing along with the direction already given of the kind of a building we are looking at. Bernhardson stated that we have a range of quality and staff can put a package together as to what it will cost, take out what additional site costs there are if we go to a different site and what we can save from this site and then plug those numbers into what we are looking for as far. as cash, for a cash buy out, general obligation bonds or some combination and a lease • purchase. Mayor. Grabek stated we have to put the figures together before we debate where to put the facility. This would include the sale price for the Crystal Bay and sewer plant site. Grabek directed staff to make a list of steps that have to be completed in the process and to put estimated completion dates on these. ADJOURNMENT 7:42 P.M. Motion by Mayor. Grabek, seconded by Councilmember. Nettles to adjourn at 7:42 P.M. Motion, Ayes 4, Nays 0, Motion passed. �~ Jam s R. Gr a ayor. F-,� 4