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11 21 22 Work Session MinutesCity Council Work Session November 21, 2022 Page 1 City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 City Council Minutes Work Session Meeting November 21, 2022 Northwood Conference Room CALL TO ORDER The New Hope City Council met in work session pursuant to due call and notice thereof; Mayor Hemken called the meeting to order at 6:30 p.m. ROLL CALL Council present: Kathi Hemken, Mayor John Elder, Council Member Andy Hoffe, Council Member Michael Isenberg, Council Member Jonathan London, Council Member Staff present: Tim Hoyt, Acting City Manager Jeff Alger, Community Development Specialist Dan Boyum, City Engineer Erin Enstad, Abdo Financial Solutions Vicki Holthaus, Abdo Financial Solutions Rich Johnson, Director of HR/Admin. Services Valerie Leone, City Clerk Shawn Markham, Forester/Contract Manager Susan Rader, Director of Parks & Recreation Jeff Sargent, Director of Community Development Bernie Weber, Director of Public Works Stacy Woods, City Attorney Also present: Ann Ackerman, Stantec Joel Nelson, WMFR District WMFRD UPDATE Item 11.1 Mayor Hemken introduced for discussion item 11.1, Update from West Metro Fire- Rescue District. Mr. Joel Nelson, assistant chief of administration for WMFR District, was recognized. He reported there were 852 calls for service for New Hope from January 1 through September 30, 2022. Mr. Nelson reported on recent public events, training, fire prevention activities, update on fire truck delivery, the recent firefighter recruitment process and staff departures and retirements. Council Member Isenberg questioned the composition of the firefighter applicants. Mr. Nelson indicated there were about 40 applicants that were narrowed down to 15. He stated of the 15 approximately 30% are non-Caucasian. He noted the fire chief and fire district staff support Diversity, Equity and Inclusion similar to the cities of New Hope and Crystal. Council thanked Mr. Nelson for the report. City Council Work Session November 21, 2022 Page 2 EMERALD ASH BORER UPDATE Item 11.2 Mayor Hemken introduced for discussion item 11.2, Discussion of New Hope’s Emerald Ash Borer program including an update on efforts made in 2022 and the recommended renewal of the contract with the city’s tree care company in 2023. Mr. Shawn Markham, forester/contract manager, stated the Minnesota Department of Agriculture has deemed New Hope and the rest of Hennepin County as “generally infested”. He explained this designation signifies the focus of Emerald Ash Borer management will shift from a prevention and slowing of the Emerald Ash Borer to a management plan with a focus on sanitation/removal and safety. Mr. Markham stated the city allocated a total of $625,000 for trees. During the year the city removed 393 Ash trees and 12 non-ash trees in city right-of-way and 93 Ash trees from city parks. He noted non-ash species were removed due to a hazardous condition or severe decline in tree health. He noted many more trees in boulevards and city parks are scheduled to be removed yet this year. He stated a total of 203 trees were planted in the city in 2022. He stated many trees were purchased through a county grant, and there were 20 trees donated by Hennepin County due to a delayed planting project initiated by the county. Discussion ensued regarding the costs for treating Ash trees on an every other year basis and the cost for tree removal. Parks and Recreation Director Susan Rader and Mr. Markham spoke favorably regarding the city’s relationship with Bratt/Heartwood Tree Surgeons (formerly Tim’s Tree Service) and pointed out the current contract expires in March, 2023. Director Rader stated tree services are considered a professional service and bids/quotes are not required. She stated unless there are objections from Council, staff will present a new contract in 2023 with Bratt/Heartwood Tree Surgeons. Council thanked staff for the update. 2023-2032 PAVEMENT MANAGEMENT PLAN Item 11.3 Mayor Hemken introduced for discussion item 11.3, Update and Discussion regarding the 2023-2032 Pavement Management Plan. Mr. Boyum, city engineer, stated the plan contains projects and associated costs for years 2023 through 2032. He stated improvements are planned for all streets within the 10-year pavement management plan. Mr. Boyum stated all the estimated costs have been reviewed with the city’s finance consultant and staff strives to keep the costs within the parameters of the estimated revenue stream. Mr. Boyum reviewed the pavement condition index (PCI) ratings for the streets. He stated since 2013 approximately 36.10 miles of streets have been improved of the city’s 65 miles of local and MSA streets. He explained only 3.17 miles (or 4.9% of streets) are rated in poor condition or worse. It was noted that seal coat and fog seal applications have extended the life span of streets. Council thanked staff for the presentation. City Council Work Session November 21, 2022 Page 3 LONG-TERM FINANCIAL PLAN Item 11.4 Mayor Hemken introduced for discussion item 11.4, Review updated draft long-term financial plan with Abdo. Ms. Vicki Holthaus, Abdo, stated a capital improvement plan for Information Technology was added this year after completion of the long-term CIP in March. She stated the assumption for franchise fees revenue in the street infrastructure fund was increased from $440,000 to $705,000 based on the rate increase to be implemented in 2023. Ms. Holthaus stated levies of $100,000 were considered for the 2023 budget cycle for the fire capital fund, city hall capital fund and swimming pool capital fund but were not implemented. These will be reintroduced in the 2024 budget cycle. Ms. Holthaus provided highlights of the long-term financial plan taking into consideration trends in enterprise fund revenues and expenses along with programmatic change that have been proposed for the 2023 budget including the golf superintendent and a water maintenance position. She stated the plan aligns with the ten-year pavement management plan. The tax rate is projected to increase from 57 to 60 percent over the life of the ten-year plan. Over the duration of the plan, the total cash position of the city is projected to increase from $47 million to $75 million, and the total debt outstanding is projected to decrease from $46 million to $7 million. There is no new debt issuance modeled in the plan. Council Member London expressed concern that expenditures may be outpacing revenue growth. He challenged directors to determine methods to fund capital without increasing the levy. Ms. Holthaus commented that enterprise funds may generate more revenue than expenditures. Council Member London inquired of scenarios if property values decrease by ten percent. Ms. Holthaus stated Abdo can prepare an analysis if requested by Council. 2023 BUDGET Item 11.5 Mayor Hemken introduced for discussion item 11.5, Review public hearing presentation for proposed 2023 budget. Mr. Tim Hoyt, acting city manager, stated the public hearing for the 2023 budget is scheduled for December 5. He requested feedback from Council regarding the proposed powerpoint presentation. Council Member London recommended adding the rating scale for the insurance industry rating of fire services and to modify the tax rate slide. Ms. Holthaus indicated the changes will be made by elaborating on the insurance rating and illustrating the tax rate information for the city only. DRAFT THC ORDINANCE Item 11.6 Mayor Hemken introduced for discussion item 11.6, Discussion regarding draft tetrahydrocannabinol (THC) ordinance and setting annual license fee. Mr. Jeff Sargent, director of community development, presented the draft ordinance to regulate the sale of consumable THC products. He stated a new law was enacted at the City Council Work Session November 21, 2022 Page 4 end of the 2022 legislative session that allows certain edible and beverage products infused with tetrahydrocannabinol to be sold. He stated there can be no more than five milligrams of THC per serving and a maximum of 50 milligrams per package. Mr. Sargent noted the law does not specifically limit where edible cannabinoids products can be sold, but they are prohibited from off sale liquor stores. He stated staff recommends setting the license fee at $500. Council supported adoption of the ordinance and implementing a cap of 20 licenses. Mr. Sargent indicated the ordinance will be presented at a future council meeting. PERFORMANCE MEASUREMENT REPORT AND SMART GOALS Item 11.7 Mayor Hemken introduced for discussion item 11.7, Update on Performance Measurement Report and SMART goals. Mr. Jeff Alger, community development specialist, reviewed the 2022 Performance Measurement Report and SMART goals document that contains data of 2018-2021. He reported the SMART goals are generally on track. Mr. Alger stated information from this year’s professional community survey will be included in next year’s report. Council accepted the report and complimented Mr. Alger for his work. They authorized posting the document on the city’s website. ECONOMIC DEVELOPMENT REPORT UPDATE Item 11.8 Mayor Hemken introduced for discussion item 11.8, Update on Economic Development Report. Mr. Jeff Alger, community development specialist, stated the report was developed in 2016 and is updated annually. He stated the economic development report highlights redevelopment projects throughout the city from the previous year and the tools that are in place to promote development activity. He stated the city’s EDA promotes and facilitates business development and housing redevelopment activities. Mr. Alger noted the report was utilized in 2017 when bonds were issued for the new police station/city hall construction project, in 2019 when bonds were issued for the swimming pool complex, and in 2021 for refinancing of ice arena conservation bonds. He reviewed the updates that were made to the 2022 report. Council Member London asked whether the city tracks vacancies of commercial properties. Staff responded that the city has a document posted on the website that lists vacant space and leasing information. Council accepted the report and supported posting it on the city’s website. MOU CONTINUATION Item 11.9 Mayor Hemken introduced for discussion item 11.9, Discussion regarding continuation of Memorandum of Understanding between Tim Hoyt and the City of New Hope for Director of Police and Acting City Manager. Mr. Rich Johnson, director of administrative services/IT, was recognized. He stated the memorandum of understanding with Hoyt expires December 1, 2022. He indicated the mayor inquired of continuing the arrangement on a permanent basis. Mr. Johnson pointed out the police pension plan is different from the coordinated plan, and Hoyt City Council Work Session November 21, 2022 Page 5 would like to continue in the police pension plan. He stated he spoke with staff from PERA and the League of Minnesota Cities regarding the unique position held by Hoyt. He stated PERA indicated the city would need to adopt a resolution addressing the dual role and that Hoyt’s police duties comprise at least 51% of the position. Mr. Johnson stated the police department currently has a chief and two captains. He stated a reorganization of the police department could occur by elevating one captain to a deputy chief to handle day-to-day operations. He explained that Abdo confirmed the city could realize a cost savings of approximately $150,000 with a dual city manager/police chief, a deputy chief and one captain instead of a traditional city manager. He stated it is imperative to consider what is best for the city. Council Member Elder commented that many metro police departments have a deputy chief structure. Mr. Johnson noted there are cities with employees holding dual roles for fire and police chief. Discussion ensued regarding the option of seeking external candidates. Mayor Hemken stated the city has a capable individual with a proven track record. She recommended extending the MOU for two months to continue discussions. She asked staff to prepare various scenarios and costs. Council expressed support for extending the current MOU to February 1, 2023, to allow time to explore options. ADJOURNMENT The meeting was adjourned at 8:56 p.m. as there was no further business to come before the Council at its work session. Respectfully submitted, Valerie Leone, City Clerk