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05 18 20 Work Session MinutesCity Council Work Session May 18, 2020 Page 1 City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 City Council Minutes Work Session Meeting May 18, 2020 City Hall, Virtual WebEx 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 Cedrick Frazier, Council Member Andy Hoffe, Council Member Jonathan London, Council Member Staff present: Kirk McDonald, City Manager Brandon Bell, Community Development Assistant Dan Boyum, City Engineer Tim Fournier, Director of Police Vicki Holthaus, AEM Beth Kramer, Communications Coordinator Sarah Larson, Fire Chief Susan Rader, Director of Parks & Recreation Jeff Sargent, Director of Community Development Mark Severson, Recreation Facilities Manager Bernie Weber, Director of Public Works Stacy Woods, Assistant City Attorney WMFRD UPDATE Item 11.1 Mayor Hemken introduced for discussion item 11.1, Update from West Metro Fire- Rescue District. Ms. Sarah Larson, Chief of West Metro Fire-Rescue District, reviewed the department’s duty crew staffing that has been implemented due to the pandemic. She also reviewed the preliminary 2021 fire budget. She stated the total 2021 budget is $2,674,050 which is a $99,800 increase from last year. The general operating budget increase is $89,800 or 4.42%, based on increases in salaries, PERA, workers comp insurance, motor fuels, equipment repairs, communications and financial services. There is a $20,000 increase to the capital plan to offset a future deficit and there is a $10,000 decrease to the special revenue insurance fund. She stated New Hope’s share of the toal budget is $1,352,363 or 50.5736%. It was noted the fire board has rescheduled the May 13 work session to June 10 to discuss the budget. Both city councils must act on the budget by August 31. Council thanked Chief Larson for the budget presentation. 2020 MORRIS LEATHERMAN Mayor Hemken introduced for discussion item 11.2, Discuss professional community wide survey in 2020 with Morris Leatherman Company. City Council Work Session May 18, 2020 Page 2 COMMUNITY WIDE SURVEY Item 11.2 Mr. Brandon Bell, community development assistant, explained at the February 2020 work session staff discussed a potential professional survey being conducted by Morris Leatherman. He stated subsequent to the work session Peter Leatherman submitted a preliminary survey for review. He stated due to the pandemic and closure of some programs and facilities it may be best to postpone the professional survey until next year. As an alternative, he recommended utilizing a performance measurements survey to be mailed with the July utility bills. Council expressed support for postponing the professional survey until 2021 and directed staff to prepare a community performance measurements survey for review at a future work session. TOBACCO REGULATIONS Item 11.3 Mayor Hemken introduced for discussion item 11.3, Discuss Potential Changes to Tobacco Regulations. Mr. Brandon Bell, community development assistant, stated the citizen advisory commission reviewed tobacco use prevention options with New Hope business owners and residents on February 11, 2020, and Council reviewed the commission’s recommendations at the work session of February 18, 2020. He stated staff was directed to prepare a proposed ordinance and Mitchell Hamline Public Health Law Center and the city attorney coordinated drafting the ordinance amendment. Mr. Bell outlined the changes contained in the proposed tobacco ordinance amendment: 1. Many definitions have either been revised or added to provide or more modern verbiage. 2. Mirrored the newest federal regulations including raising the legal age required to purchase tobacco products, from 18 years of age to 21 years old. Also includes the ban on all flavored cartridge-based e-cigarettes (except for tobacco flavored). 3. Raised the age of those legally allowed to sell tobacco products as a clerk at a licensed retailer to 18. 4. Banned the sales of all flavored tobacco products except for mint, menthol and wintergreen. 5. Possession, use, and purchase laws have been removed that would punish people under the age of 21 who attempted to buy tobacco. 6. Put a cap on the number of tobacco licenses in the city to equal the total amount of licenses held at the beginning of 2021. The current amount is 21, but with a ban on- site pharmacy licenses, the number will be reduced to 19 in 2021. 7. Prohibit the sales of tobacco in any facility that contains an on-site pharmacy. Current license holders will keep these licenses until the end of the year, but will not be eligible for renewal. 8. Change the age of those allowed to conduct compliance checks from 15-17 to 17- 20 to align with new state policies. 9. Increase the fine for first time violations for tobacco license holders from $250 to $300. This reflects changes to new state regulations. Mr. Bell asked for Council input on items 6 and 7. He stated staff finds all of these proposed changes to be reasonable and to align with many of the changes that other cities in the area have made to their tobacco ordinances. Many of the businesses that City Council Work Session May 18, 2020 Page 3 staff has been in contact with, and that attended the CAC meeting in February, also seemed to find these changes acceptable. Mayor Hemken recalled the discussion at the February work session and expressed support for not banning the sale of mint, menthol or wintergreen-flavored tobacco products. Council inquired about feedback from businesses. Mr. Brandon Bell stated four businesses attended the Citizen Advisory Meeting in February and two businesses contacted him about the work session. Council Member Frazier inquired if there was any feedback from pharmacies. Mr. Bell stated he did not hear from Walgreen’s or Hy-Vee. Council Member Frazier stated he supports banning menthol and wintergreen flavored tobacco as well. Mr. McDonald indicated all 21 tobacco license holders were notified of the work session. Discussion ensued regarding compliance checks and utilizing persons who are 17-20 years old. Chief Fournier noted the older age may be helpful as the same person(s) can assist with tobacco and liquor compliance checks. He stated the checks ensure the retailers are checking identifications and not selling to minors. Chief Fournier also said the check ensures the business is selling licensed products only. Council Member London did not support banning tobacco in retailers that have pharmacies. He cited the Hy-Vee situation where tobacco would be banned in the grocery store (due to the pharmacy) but allowed next door in the liquor store and also at the Hy-Vee gas/convenience store on the same property. He expressed a preference to follow state or federal law. Mr. McDonald stated the ordinance will be placed on the May 26 agenda for consideration. Mayor Hemken extended the city’s appreciation to Hennepin County Public Health and Mitchell Hamline Public Health Law Center, residents, businesses, and members of the citizen advisory commission for their input. 2020 WINNETKA WATERMAIN REPLACEMENT (IMPROVEMENT PROJECT NO. 1027) Item 11.4 Mayor Hemken introduced for discussion item 11.4, Discuss Change Order No. 1 for G.F. Jedlicki Inc. Contract for 2020 Winnetka Watermain Replacement Project (Improvement Project No. 1027). Mr. Dan Boyum, city engineer, stated the 2020 Winnetka Watermain replacement project was awarded to G.F. Jedlicki Inc. on February 10, 2020. He stated additional costs of approximately $15,600 were incurred for costs associated with COVID-19 and county permitting. The additional costs included furnishing and installing a temporary bituminous patch over portions of the center island that was removed, removal of the island, signal and electrical work, and plumber assistance for home and business connections. CenterPoint Energy may be reimbursing the city for permits and extra City Council Work Session May 18, 2020 Page 4 labor and material costs associated with the contractor removing the concrete center island as it was necessary for the future CenterPoint gas main replacement work. Mr. Boyum also reviewed the status of quantities on the project that differed from the original bid documents and will be addressed at the time of project close out. He recommended approval of change order no. 1 and stated the water fund will pay for the extra costs. Mr. McDonald pointed out the city must pay the contractor $15,600 but will receive a partial reimbursement from CenterPoint. POOL/CIVIC CENTER PARK/CITY HALL LANDSCAPING PROJECTS UPDATE (IMPROVEMENT PROJECT NOS. 995/941/995) Item 11.5 Mayor Hemken introduced for discussion item 11.5, Update on Pool/Civic Center Park/City Hall Landscaping projects by Stantec Engineering (Improvement Project Nos. 995/941/994). Mr. Dan Boyum, city engineer, and Ms. Susan Rader, director of parks and recreation, provided a project update. Mr. Boyum explained that Sunram, the contractor for the green contract, has installed curb and gutter and sidewalk around the pool parking lot and the monument sign since the last update. Paving of the pool parking lot was scheduled to take place the week of May 11 and paving of the trails is planned for May 20, weather permitting. Sunram’s electrical subcontractor continues to work on light poles, bollards, and wiring throughout the park areas. They plan to finish topsoil placement and then start blow mulch, plantings around City Hall and the park areas, various amenities, and final irrigation work the week of May 18. Once the pool contractor backfills the vortex pool on or around May 20, Sunram will start on final storm sewer, sidewalk, and restoration between the City Hall parking lot and the pool. At the 50-meter pool, and after passing the leak test, the pool contractor is working on grout and tile work. In the bathhouse, a punchlist walkthrough was done on May 11, so remaining work will be focused on what is identified on the punchlist. The mechanical building is also close to being completed, and they are fine-tuning controls prior to start-up of equipment. Paving of the parking lot by the mechanical building should be completed by May 18. The vortex pool floor w ill be poured soon. Fencing foundations and posts have been worked on over the last month. All slides and most features have been installed at the recreational pool. The pool contractor is continuing work on other concrete placement and additional exterior site improvements. On the performance center and picnic shelter project, the contractor has finished stonework and is preparing final areas for sidewalk placement. Topsoil was spread the week of May 11, and seeding, sodding, and irrigation work will be started the week of May 18. Lighting and other miscellaneous items are expected to be completed the week of May 25. Council Member London shared concerns relayed to him by residents regarding pooling of storm water near the trail. City Council Work Session May 18, 2020 Page 5 Mr. Boyum stated the contractor and staff are aware that fill is needed north of the cemetery for proper drainage. He stated Sunram will handle it soon. Mayor Hemken inquired of the exposed wiring on the back side of the monument sign. Mr. Boyum stated the contractor has ordered the proper back plat es that will be installed on the sign. Mr. Boyum reviewed the pool-related change orders that will be presented for approval at the May 26 Council Meeting including power to condensers, stanchions and rope additions, ice and snow guard (credit), fire sprinkler system (credit), performance shelter/picnic shelter irrigation and time extension (no cost). Ms. Rader stated the changes including the credits result in a cost of $1,685 for the change order with Donlar Construction. Discussion ensued regarding irrigation systems and required maintenance. Ms. Rader noted park staff is familiar with maintaining irrigation systems. Council Member London recommended the irrigation system have sensors for water conservation purposes (will not activate if it is raining). Mr. Boyum stated he will confirm that the new equipment includes sensors. Council directed staff to place the two change orders on the May 26 Council Meeting for approval. Ms. Rader stated there have been extra costs for engineering construction management services. City Engineer Boyum reviewed the letter dated April 27, 2020, outlining the construction management services and material testing fees for the pool, theatre, and park. He addressed the additional engineering costs that are associated with the projects including additional costs due to project delays, restaking for the green contractor, coordination and staking for Xcel, deck pour analysis, winter construction analysis, delay claim, and CenterPoint permit items. He noted the coordination of the multiple projects was critical. Mr. Boyum stated the costs of the additional construction management services is $214,774.03. He pointed out the city will be reimbursed by Donlar (AET testing and deck repair), by Sunram (restaking), and Shingle Creek Watershed (for 50% of underground chamber) for a total credit of approximately $46,000. Council was supportive of adding Addendum #3 to the May 26 Council Meeting. Discussion ensued regarding work that is not included on original plans. Mr. Boyum stated a budget contingency is established for these situations and contractors request change orders to cover the expenses. City Attorney Woods stated adjustments to contracts are permissible. Ms. Rader stated Stantec prepared very detailed plans and relatively few items were overlooked. She indicated the work would have been paid for in the original plans or as a change order. Mr. Kirk McDonald, city manager, noted the project is $19 million and the majority of the $260,000 budget overage is due to poor soils and the amount of rainfall. Ms. Rader then reviewed the overall cost summary of the projects. Staff currently estimates a shortfall of approximately $260,670.37, with the recommendation of Vicki City Council Work Session May 18, 2020 Page 6 Holthaus of AEM to authorize a one-time transfer from the Temporary Financing Fund at the conclusion of the project. Discussion was held regarding the 2020 pool season. Due to COVID-19, there is currently no clear direction on when or if pools will be able to open. If they are allowed to open, state guidelines will be in place regarding lower capacity limits, social distancing and operation procedures. Other considerations include staffing, budget and safety of pool users. Only 23 applications have been received to date and the Red Cross certification courses for new lifeguards have been cancelled, so seasonal staff is unable to be trained and certified. Two options were discussed: delay the opening until July 6 or delay the opening until 2021. After further discussion, the Council elected to wait until 2021 to open the facility. Council thanked staff for the update. 2019 AUDIT AND CAFR Item 11.6 Mayor Hemken introduced for discussion item 11.6, Review 2019 Audit and Comprehensive Financial Report with AEM. Mr. Kirk McDonald, city manager, reported the total general fund expenditures were under budget by $240,364 primarily in public safety and parks and recreation. He noted the total general fund revenues were over budget by $72,388 due to investment earnings, intergovernmental revenue and franchise fees for an overall positive fund balance of $312,752 prior to the approved transfers. He commended all department heads and employees for holding down expenses. Mr. McDonald noted per accounting standards the two transfers made fro m the 2018 fund balance during the 2019 budget year ($150,000 for the fire capital projects fund and $204,000 for the city hall CIP fund) must be deducted from the fund balance of the 2019 budget which results in -$41,248. Mr. McDonald stated the auditor’s report did not identify any deficiencies in internal controls that they consider to be material weaknesses, they reported no findings, and they encountered no significant difficulties in dealing with management in performi ng and completing the audit. He indicated staff will be coordinating with AEM to submit an application for the 2019 excellence in achievement for financial reporting certificate similar to recent years. He thanked AEM for their efforts in preparing the report and congratulated department heads for maintaining budgets. Mr. McDonald stated Bill Lauer from MMKR will be present at the May 2 6 Council Meeting to address the Council regarding the 2019 audit. Mr. McDonald introduced Vicki Holthaus of AEM. Ms. Vicki Holthaus, Abdo, Eick & Meyers, LLP (AEM), reviewed financial highlights of 2019:  The assets of the city exceeded its liabilities by $7 7,197,731 at the close of the year, of which $19,880,871 (unrestricted net position) may be used to meet the city’s ongoing obligations to citizens and creditors. City Council Work Session May 18, 2020 Page 7  Combined ending fund balances were $29,250,988, a decrease of $8,463,242 compared to prior year. Approximately 15.9 percent of this total amount is available for spending at the city’s discretion.  Unassigned fund balance of the General Fund was $7,116,723 or 49.6 percent of total General Fund 2019 expenditures and transfers out. The city’s policy is to maintain a 42 percent reserve.  The city’s total bonded debt decreased by $4,026,557 (7.6 percent) during the current fiscal year. The key factor of the decrease was the scheduled principal and interest payments. Ms. Holthaus noted personnel costs varied in departments and some fund balances were due to position vacancies. She also noted staff pursued grant oppor tunities which positively impacted the budget. She reviewed fund balances of several general funds and explained fund balances and cash balances of enterprise funds and internal service funds. She noted the city has a solid financial position, and staff has managed budgets well. Council Member London stated he had some questions on the CAFR and would contact Ms. Holthaus directly for clarification. Mayor Hemken thanked Ms. Holthaus for the report. TRANSFER FROM PARK INFRASTRUCTURE TO ICE ARENA OPERATING FUND Item 11.7 Mayor Hemken introduced for discussion item 11.7, Discuss transfer from Park Infrastructure Fund to Ice Arena Operating Fund. Mr. Kirk McDonald, city manager, stated staff and AEM recommend a transfer of $400,000 from the park infrastructure fund to the ice arena fund for ice debt service and capital improvements. The long-term financial plan that was reviewed with Council in November 2019 included annual transfers to fund outstanding debt at the facility. Council supported the transfer and directed staff to prepare a resolution for consideration at the council meeting of May 26, 2020. PARKS & RECREATION AND PUBLIC WORKS 2020- 2029 CIP Item 11.8 Mayor Hemken introduced for discussion item 11.8, Discussion regarding the city’s capital improvement program (CIP) for parks and recreation and public works departments for 2020-2029. Mr. Kirk McDonald, city manager, stated Ms. Vicki Holthaus, AEM, prepared a summary memo providing an overview of each fund over the ten-year period. He recommended staff review two years of CIP items in detail with Council. Ms. Susan Rader, director of parks and recreation, reviewed CIP expenditures for 2020 and 2021 for the community gyms, golf course, ice arena, parks, and pool. Mr. Bernie Weber, director of parks and recreation, reviewed planned CIP expenditures for 2020 and 2021 including central garage, street infrastructure, sewer, storm water, and water funds. Directors Rader and Weber also highlighted projects planned for years 2022 through 2029. City Council Work Session May 18, 2020 Page 8 ADJOURNMENT The meeting was adjourned at 9:18 p.m. as there was no further business to come before the Council at its work session. Respectfully submitted, Valerie Leone, City Clerk