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091420 City Council Meeting Packet NEW HOPE CITY COUNCIL MEETING AGENDA September 14, 2020 7:00 p.m. City Hall – Council Chambers 4401 Xylon Avenue North Mayor Kathi Hemken Council Member John Elder Council Member Cedrick Frazier Council Member Andy Hoffe Council Member Jonathan London The City Council wants and encourages citizen participation at Council Meetings. Your input and opinions count and are valuable. You are encouraged to bring forth your comments and issues at the appropriate point on the agenda. A 15-minute maximum Open Forum is held at the beginning of each Council Meeting. At this time any person may address the Council on any subject pertaining to City business not listed on this agenda or scheduled as a future agenda item. The Council requests that you limit your presentation to 3 minutes. Anyone wishing to address the City Council on a particular item should raise their hand and be recognized by the Mayor. Approach the podium and speak into the microphone by first stating your name and address. Also, please record your name on the roster at the table near the door so that your name will be spelled correctly in the minutes. Individuals should not expect the Mayor or Council to respond to their comments tonight; Council may refer the matter to staff for handling or for consideration at a future meeting. You are welcome to contact the city clerk at 763-531-5117 after the council meeting. COUNCIL MEETING BROADCASTS AND STREAMING Government Access channel 16 programming includes live/taped meeting replays Live on-line meetings and past meetings on-demand are available through https://ccxmedia.org/ccx-cities/new-hope/. www.newhopemn.gov New Hope Values and Vision City Mission Strong local government that is proactive in responding to the community needs and issues by delivering quality public service to all city residents, businesses, property owners, and organizations in a prudent and e cient manner. Values Excellence and Quality in the Delivery of Services We believe that service to the public is our reason for being and strive to deliver quality services in a highly professional and cost-e ective manner. Fiscal Responsibility We believe that ﬁ scal responsibility and the prudent stewardship of public funds and city assets is essential if residents are to have conﬁ dence in government. Ethics, Integrity and Professionalism We believe that ethics, integrity, and professionalism are the foundation blocks of public trust and conﬁ dence and that all meaningful relationships are built on these values. Respect for the Individual We believe in the uniqueness of every individual, and welcome, appreciate, and respect diversity and the di ering of opinions. Open, Honest, and Respectful Communication We believe that open, honest, and respectful communication is essential for an informed and involved citizenry and to foster a positive environment for those interacting with our city. Cooperation and Teamwork We believe that the public is best served when all work cooperatively. Visionary Leadership and Planning We believe that the very essence of leadership is to be responsive to current goals and needs, and visionary in planning for the future. Vision e city is a great place to grow as a family, individual, or business. All within our city are safe and secure. Essential services will be those that promote a safe and healthy environment for all residents. Essential services and programs will be enhanced and streamlined, and will be provided in an economical manner and with measurable results. e city views residents as its greatest asset and seeks their input and participation. e city will meet the communication needs of citizens, elected o cials, and city sta . Strategic Goals e city will maintain and improve its infrastructure (water distribution, storm water, sewer, roads, parks, lighting, and city facilities). e city will use frugal spending and resourceful ﬁ nancial management to maintain its ﬁ scal health. e city will encourage maintenance, redevelopment, and reinvestment of existing properties to improve or enhance its tax base. e city will provide core services with a professional sta who are equipped with the necessary tools and equipment and given necessary direction. e city will facilitate and improve communications to promote e ective intergovernmental cooperation between sta , citizens, and Council. Adopted by the New Hope City Council, August 2006 Reaffirmed by the New Hope City Council, February 2019 CITY COUNCIL MEETING City Hall, 4401 Xylon Avenue North Monday, September 14, 2020 7:00 p.m. Regular Session 1. CALL TO ORDER – September 14, 2020 2. ROLL CALL 3. APPROVAL OF MINUTES:  Work Session Minutes – August 17, 2020  Executive Session Minutes – August 17, 2020  Council Meeting Minutes – August 24, 2020 4. OPEN FORUM 5. PRESENTATIONS 6. CONSENT BUSINESS 6.2 Approval of financial claims through September 14, 2020 6.4 Resolution providing for hearing on assessments for 2020 delinquent utility service charges, administrative citations, and alarm and mowing charges 7. PUBLIC HEARING 8. DEVELOPMENT AND PLANNING 8.1 Resolution approving Change Order No. 1 for Visu-Sewer Contract for the 2020 and 2021 Sewer Lining Project (Improvement Project No. 1048) 9. PETITIONS AND REQUESTS 10. ORDINANCES AND RESOLUTIONS 10.1 Resolution authorizing the preliminary EDA levy for 2021 10.2 Resolution approving 2021 proposed general fund budget and preliminary property tax levy, and setting public hearing date for the 2021 budget and preliminary property tax levy 11. UNFINISHED AND ORGANIZATIONAL BUSINESS 12. OTHER BUSINESS 12.1 Exchange of communication between members of the city council 13. ADJOURNMENT Memorandum To: New Hope City Council From: Kirk McDonald, City Manager Date: September 10, 2020 Subject: Agenda Items for Monday, September 14, 2020 Note: Commission candidate interviews will be held prior to the Council Meeting beginning at 6:10 p.m. in the Civic Center Conference Room. Candidate applications were distributed on August 24. Please contact the city clerk if you need a copy emailed to you. Open Forum Staff is not aware of anyone planning to address the Council for the Open Forum. Item 6.1 There are no new business license requests. Item 6.2 This item involves routine financial claims. Item 6.3 There are no new liability claims to report. Item 6.4 This resolution establishes a public hearing on October 12 to assess unpaid bills through June 1, 2020, for city utility charges, administrative citations, and alarm and mowing charges. As of September 3, the total amount owed is approximately $320,021 similar to last year’s amount. All affected property owners have been notified of the payment process and of the public hearing. Any unpaid bills after November 16, 2020, will be certified to the 2021 property tax rolls. I recommend approval. Item 8.1 Change order no. 1 is for $73,699.25 to the contract with Visu-Sewer for the 2020 and 2021 sewer lining project that was approved April 27, 2020. The 2020 and 2021 CIP includes $700,000 for lining of the city’s sanitary sewer collection system ($350,000 per year). The base bid was favorable and it is beneficial to add another 3,291 feet to the project for 2020. The city attorney’s office was consulted and advised that up to 25% of the original contract could be added as a change order. The original contract was $321,115.10 and the change order increases the contract to $394,814.35. Director Weber and I recommend approval. Item 10.1 Adoption of the resolution affirms the Council’s support for the EDA levy in the amount of $365,000 (EDA Item 4). This is an increase of $17,000 from the 2020 levy. I recommend approval. Item 10.2 This resolution establishes the 2021 preliminary general fund budget, adopts the maximum property tax levy, and sets the budget public hearing for December 7. The proposed tax levy must be certified to the county auditor no later than September 30. The proposed 2021 general fund budget is $15,936,977 which is an increase of $526,427 (3.4%) over last year. The Council is asked to approve a tax levy of $17,052,601, and the EDA is asked to approve a tax levy of $365,000 (total levy is $17,417,601 which is a 3.4% increase from last year’s levy). The majority of the tax levy increase is due to wages, police department body and squad camera purchases (phase 1), and an increase in the fire district budget. For homes valued between $150,000 and $400,000 the tax increase is estimated to be $14 to $43 or 2%. Representatives from AEM will be in attendance to assist the city manager in making a presentation regarding the proposed budget and tax levy. Council and staff will continue to review the budget this fall, and the proposed tax levy can be amended for the final adopted budget in December, but the final total cannot be any higher than the proposed levy established at this meeting. The preliminary budget and maximum tax levy were reviewed at the August 17 work session, and Council supported this as a starting point for budget discussions. I recommend approval of the resolution. Item 12.1 Mayor Hemken will review upcoming meetings and events. EDA Item 4 The EDA is asked to approve a $365,000 levy for 2021 which is a $17,000 increase over last year to help support the scattered site housing program. I recommend approval. If you have any questions regarding items in the agenda packet, please call the city clerk or me before the meeting so that staff can research any issues and be prepared to respond at the meeting. City Council Work Session August 17, 2020 Page 1 City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 City Council Minutes Work Session Meeting August 17, 2020 Civic Center 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 Cedrick Frazier, Council Member Andy Hoffe, Council Member Jonathan London, Council Member Staff present: Kirk McDonald, City Manager Dan Boyum, City Engineer Vicki Holthaus, AEM Valerie Leone, City Clerk Susan Rader, Director of Parks & Recreation Steve Sondrall, City Attorney Stacy Woods, Assistant City Attorney Also present: Sarah Larson, WMFRD Fire Chief WMFRD 2021 BUDGET Item 11.1 Mayor Hemken introduced for discussion item 11.1, Discuss West Metro Fire-Rescue 2021 Budget. Mr. Kirk McDonald, city manager, and Sarah Larson, West Metro Fire-Rescue District chief, reported on the 2021 budget. Mr. McDonald stated West Metro Fire-Rescue District’s proposed budget is $2,674,050, an increase of $99,800 over the prior year. New Hope’s percentage share of the budget increased slightly from 50.4104% in 2020 to 50.5736% for 2021. He stated the WMFRD’s board of directors approved the budget at its July 8 board meeting, and that the joint powers agreement requires both cities to approve West Metro’s budget by August 31. Mr. McDonald noted that the Crystal City Council will consider the budget at their August 18 Council Meeting. Council Member London inquired of the increase in financial services. Chief Larson reported the district utilizes AEM and MMKR for financial services and the budget has historically been underfunded in this area. Discussion ensued regarding the higher calls for service in New Hope. Chief Larson noted that New Hope has more commercial properties than Crystal and it also has three large nursing homes. She attributed these two items to the higher number of false alarm calls and medical calls. City Council Work Session August 17, 2020 Page 2 Ms. Larson explained the reasoning for the duty crew during the pandemic to reduce the risk of exposing the entire department to COVID-19. She noted the federal funding will cover the expense. Council thanked Chief Larson for the budget presentation. POOL/CIVIC CENTER PARK/CITY HALL LANDSCAPING UPDATE (IMPROVEMENT PROJECT NOS. 995/941/994) Item 11.2 Mayor Hemken introduced for discussion item 11.2, Update on Pool/Civic Center Park/City Hall Landscaping projects by Stantec Engineering (Improvement Project Nos. 995/941/994). Ms. Susan Rader, director of parks and recreation, and Mr. Dan Boyum, city engineer, provided an update to Council regarding the status of the pool and Civic Center Park projects. They reviewed the “extended general conditions” costs that were submitted by Donlar Construction. Mr. Boyum stated the original request was $267,509 and several negotiations took place. He reviewed the spreadsheet illustrating the items and revised amounts. He stated the updated request subsequent to the August meeting has been reduced from $49,207.89 to $22,744.05. Ms. Rader stated staff believes this is a reasonable compromise and staff has been pleased with the quality of workmanship on the aquatic complex. If Council supports the negotiated amount, the item will be presented as a change order at the August 24 Council Meeting. Council Member Elder inquired of the project deadlines and if the pandemic had an impact. Council was advised that June 5 was the deadline for the pool construction by Donlar Construction and August 29 is the substantial completion deadline for the landscaping by Sunram. It is not believed that the pandemic caused construction delays. Mr. Boyum reported the final lift cannot be installed on the parking lot until the concrete is replaced at the police entrance. Ms. Rader indicated that Sunram has been reminded of the deadline and that the contract contains liquidated damages language. Mr. McDonald requested the city attorney to send a formal letter to Sunram putting them on notice regarding the potential for liquidated damages. Council Member London noted the major concern is timing. He inquired of the project status in terms of total budget and asked to be provided full information in the August 24 agenda packet. Director Rader noted the costs were shared at the May work session (estimated shortfall of $261,000). Mr. McDonald commented that over $100,000 of the overage was due to poor soil conditions. Ms. Rader indicated she would include the financials in the August 24 report. She also noted she will continue to update Council in the Friday updates. She stated the punchlist is being addressed and the pool will be drained and winterized soon. Mr. McDonald commended Director Rader for coordinating the required paperwork regarding external funding for the pool. Council directed staff to present the change order at the August 24 Council Meeting. City Council Work Session August 17, 2020 Page 3 COMMISIONER APPRECIATION EVENT 2020 Item 11.3 Mayor Hemken introduced for discussion item 11.3, Discuss Commissioner Appreciation Event for 2020. Mr. Kirk McDonald, city manager, noted the city usually hosts a city-wide bus tour of completed projects for commissioners and elected officials. He stated due to the pandemic it is recommended that instead of an in-person gathering, a virtual bus tour or self-driving tour be prepared and provided to persons typically invited to the annual appreciation event along with a letter from Council expressing appreciation for their service. Council supported staff’s recommendation for a virtual or self-driving tour. ELECTRIC AND GAS FRANCHISE FEE ORDINANCE Item 11.4 Mayor Hemken introduced for discussion item 11.4, Review electric and gas franchise fee ordinance. Mr. Kirk McDonald, city manager, stated city code requires the electric and gas franchise fee ordinances to be reviewed every two years. He stated the fees were last increased in 2017. Council Member London stated the city collects nearly $1 million through this revenue stream which is essentially another tax. He stated he is pleased to see there is a plan for the use of the funds ($440,000 is directed to the street infrastructure fund to help support the pavement management plan). Mr. Steve Sondrall, city attorney, was recognized. He stated it is not necessary for the Council to take any action unless it desires to modify the fees. He stated franchise fees are authorized by state statute. Council reviewed the ordinances and directed staff to make no changes. THREE-YEAR CONTRACT RENEWAL WITH AEM Item 11.5 Mayor Hemken introduced for discussion item 11.5, Discuss Three-Year Contract Renewal with AEM for Professional Financial Management Services for Years 2021 - 2023. Mr. Kirk McDonald, city manager, stated the city has utilized the financial management services of AEM since December 2008 and has been pleased with their broad range of services. He stated AEM has prepared a three-year contract renewal for Council’s consideration. He stated the average annual increase is slightly over 3%. He indicated the CAFR preparation responsibility has been transferred to MMKR so the 2021 contract price of $129,150 is slightly lower than 2020’s contract. Mr. McDonald noted that West Metro Fire-Rescue District and the city of Crystal also contract with AEM for financial management services. Council unanimously supported the contract renewal proposal and directed the city manager to place the item on the August 24 agenda for formal approval. Council Member London thanked Vicki Holthaus for illustrating the outsourcing costs withi n the budget document. City Council Work Session August 17, 2020 Page 4 MMKR LETTER OF ENGAGEMENT 2020 AUDIT/CAFR Item 11.6 Mayor Hemken introduced for discussion item 11.6, Review Letter of Engagement from MMKR to Perform 2020 Audit/CAFR. Mr. Kirk McDonald, city manager, stated the city has utilized the services of MMKR for several years for completion of the city’s annual audit. He stated a three -year proposal was approved at the October 28, 2019, Council Meeting. He stated Council is asked to consider the letter of engagement from MMKR to perform the 2020 audit and CAFR. Mr. McDonald stated the proposal includes a quote for preparation of the Comprehensive Annual Financial Report (CAFR) that was previously handled by AEM but is recommended to be performed by MMKR to improve the audit and financial reporting timeline. He stated the cost for the 2020 audit and CAFR is $38,730 plus a separate single audit of federal awards for the CARES/FEMA funding at a cost of $5,000 for a total cost of $43,730. Ms. Holthaus indicated CARES funding will cover the cost of the single audit. Council supported the letter of engagement and directed staff to place the item on the August 24 Council Meeting for approval. 2021 PRELIMINARY GENERAL FUND BUDGET AND TAX LEVY Item 11.7 Mayor Hemken introduced for discussion item 11.7, Discussion regarding 2021 preliminary general fund budget and tax levy. Mr. Kirk McDonald, city manager, stated the Council will be asked to set its maximum 2021 tax levy at the September 14 Council Meeting. The general fund budget will be reviewed and refined this fall and the final budget and tax levy will be adopted in December. Mr. McDonald stated the proposed preliminary maximum total tax levy of 3.4% is lower than the initial estimated levy of 6.7%. He stated the proposed general fund budget is $15,936,977, and the proposed general fund tax levy is $10,879,465 which is a 3.5% increase over last year. He explained $156,000 is budgeted for phase 1 of police department body and squad camera purchases and is recommended to be funded by a transfer in from the IT reserve fund in order to keep the general fund tax levy to a minimum. He reviewed other major changes including an increase in the budget for the fire district, a decrease in the elections budget, an increase in LGA, and an increase in wages. He stated all directors will be present at the September work session to review the proposed budgets in detail. Mr. McDonald stated the estimated overall impact of the city tax levy on residential properties will not be available from Hennepin County for a few weeks. Ms. Vicki Holthaus, AEM, explained the tax rate is preliminary and the actual tax impact on residential homes could vary from the preliminary budget document. Council agreed upon the recommended maximum tax levy and conducting the budget hearing on December 7. City Council Work Session August 17, 2020 Page 5 RESOLUTION CALLING FOR CLOSED MEETING Item 11.8 Mayor Hemken introduced for discussion item 11.8, Resolution calling for a closed meeting of the New Hope City Council authorized by Minn. Stat §13D.05, Subd. 3 to discuss and consider threatened litigation. RESOLUTION 2020-82 Item 11.8 Council Member Elder introduced the following resolution and moved its adoption: “RESOLUTION CALLING FOR A CLOSED MEETING OF THE NEW HOPE CITY COUNCIL AUTHORIZED BY MINN. STAT §13D.05, SUBD. 3 TO DISCUSS AND CONSIDER THREATENED LITIGATION.” The motion for the adoption of the foregoing resolution was seconded by Council Member Frazier, and upon vote being taken thereon, the following voted i n favor thereof: Hemken, Elder, Frazier, Hoffe, London; and the following voted against the same: None; Abstained: None; Absent: None; whereupon the resolution was declared duly passed and adopted, signed by the mayor which was attested to by the city clerk. ADJOURNMENT The meeting was adjourned at 7:26 p.m. as there was no further business to come before the Council at its work session. Respectfully submitted, Valerie Leone, City Clerk City Council Executive Session August 17, 2020 Page 1 City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 City Council Minutes Executive Session August 17, 2020 Civic Center Room CALL TO ORDER The New Hope City Council met in executive session pursuant to due call and notice thereof; Mayor Hemken called the meeting to order at 7:28 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 Valerie Leone, City Clerk Steve Sondrall, City Attorney Stacy Woods, Assistant City Attorney THREATENED LITIGATION Mayor Hemken introduced Item 11.1, Discussion regarding threatened litigation related to the proposed tobacco ordinance amendments. Council, staff, and legal counsel discussed the components of the proposed ordinance amendment, rationale for implementation, and impact to tobacco licensees. Council directed staff to present a revised ordinance at the August 24 Council Meeting for consideration. ADJOURNMENT The meeting was adjourned at 7:57 p.m. as there was no further business to come before the Council at its executive session. Respectfully submitted, Valerie Leone, City Clerk New Hope City Council August 24, 2020 Page 1 City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 City Council Minutes August 24, 2020 Regular Meeting City Hall, 7:00 p.m. CALL TO ORDER The New Hope City Council met in regular session pursuant to due call and notice thereof; Mayor Hemken called the meeting to order at 7:00 p.m. PLEDGE OF ALLEGIANCE The City Council and all present stood for the Pledge of Allegiance. ROLL CALL Council present: Staff present: Kathi Hemken, Mayor John Elder, Council Member Cedrick Frazier, Council Member Andy Hoffe, Council Member Jonathan London, Council Member Kirk McDonald, City Manager Brandon Bell, Community Development Assistant Dan Boyum, City Engineer Valerie Leone, City Clerk Susan Rader, Director of Parks & Recreation Bernie Weber, Director of Public Works Stacy Woods, Assistant City Attorney Also present: Sarah Larson, WMFRD Chief Bruce Paulson, Stantec APPROVAL OF MINUTES Motion was made by Council Member Hoffe, seconded by Council Member Elder, to approve the regular meeting minutes of August 10, 2020. Voted in favor thereof: Hemken, Elder, Frazier, Hoffe, London; and the following voted against the same: None; Abstained: None; Absent: None. Motion carried. Motion was made by Council Member Frazier, seconded by Council Member London, to approve the canvassing board minutes of August 14, 2020. Voted in favor thereof: Hemken, Frazier, London; and the following voted against the same: None; Abstained: Elder, Hoffe; Absent: None. Motion carried. OPEN FORUM There was no one present desirous of addressing the council. ROTATING VOTES Please note that votes taken on each agenda item are called by the secretary on a rotating basis; however, the written minutes always list the mayor’s name first followed by the council members’ in alphabetical order. CONSENT AGENDA Mayor Hemken introduced the consent items as listed for consideration and stated that all items will be enacted by one motion unless requested that an item be New Hope City Council August 24, 2020 Page 2 removed for discussion. Mr. Kirk McDonald, city manager, reviewed the consent items. BUSINESS LICENSE(S) Item 6.1 Approval of business licenses(s). FINANCIAL CLAIMS Item 6.2 Approval of financial claims through August 24, 2020. MOTION Item 6.4 Motion approving appointment of Malloy, Montague, Karnowski and Radosevich (MMKR) to perform 2020 city audit. MOTION Item 6.5 Motion approving three-year contract renewal with AEM for professional financial management services for years 2021-2023. RESOLUTION 2020-83 Item 6.6 Resolution approving Change Order No. 10 in the amount of $22,744.05 with Donlar Construction Company for the pool construction project (Improvement Project No. 995). Council Member London requested an update on the pool budget. City Manager McDonald indicated the financial information will be distributed to Council. RESOLUTION 2020-84 Item 6.7 Resolution authorizing the purchase of equipment and appropriation of funds in the amount of $8,673 for the purchase of batteries for the 2012 Zamboni by Midwest Industrial Battery, Inc. for the Ice Arena. MOTION Consent Items Motion was made by Council Member Elder, seconded by Council Member Hoffe, to approve the Consent items. All present voted in favor. Motion carried. PUBLIC WORKS FACILITY EXPANSION (IMPROVEMENT PROJECT NO. 1039) Item 8.1 Mayor Hemken introduced for discussion Item 8.1, Presentation of feasibility report for the Public Works Facility Expansion (Improvement Project No. 1039). Mr. Dan Boyum, city engineer, along with Bruce Paulson, architect with Stantec, presented the feasibility report for the public works facility expansion. They described storage needs, illustrated a proposed 20,000 square foot addition, a 3,000 square foot soils storage building, addition of air conditioning to the mechanics bay and fitness room, a new security system to tie into the city hall system, relocation of the fuel dispensing system, addition of a mechanics supervisor office and expansion of the parts storage room, new compressor room to contain the compressor noise, replace overhead and service doors into the vehicle parking spaces, repair and clean concrete floors, replace the south two-thirds of the trench drain and sand interceptor, add irrigation system, and renovations to lunchroom and hallway flooring. Mr. Boyum stated a 30-year replacement analysis was prepared to identify equipment replacement savings associated with storing vehicles and equipment indoors versus outside. He stated the estimated cost savings to the city by moving fleet vehicles inside is $33,013 annually or $990,393 over 30 years. New Hope City Council August 24, 2020 Page 3 The funding for a building expansion is estimated at $6.4 million and a reduced scope project is $1.5 million. It was noted that since 2017 funds have been set aside through central garage charges for the project and the reduced scope improvements could be paid for with current funds as well as central garage reserves. The potential for internal financing from the temporary financing fund for the larger building expansion project will not be known until the Civic Center Park and Pool projects are completed. Mr. Boyum recommended continuing discussions regarding a reduced scope project at a future work session. Mr. McDonald acknowledged that Council is reluctant to issue bonds at this time due to the recent city hall and pool projects and that a larger public works expansion project will have to be postponed. He asked Council to accept the report and encouraged council members to schedule a tour of the existing facility this fall. Council Member London requested more information regarding the 30-year replacement analysis. He noted the garage at the new police facility will extend the life of police vehicles. He asked staff to provide the projected opera ting cost increase (for central garage charges) for the expansion. Mr. McDonald reported that calculations can be prepared and distributed. Discussion ensued regarding the location of the facility gates and the need for increased security. Council thanked staff for the report. MOTION Item 8.1 Motion was made by Council Member Elder, seconded by Council Member Frazier, to accept the report. All present voted in favor. Motion carried. WMFRD 2021 BUDGET Item 10.1 Mayor Hemken introduced for discussion Item 10.1, Resolution approving West Metro Fire-Rescue District 2021 Budget. Mr. Kirk McDonald, city manager, stated West Metro’s 2021 budget is $2,674,050 and New Hope’s share is $1,352,363 (an increase of $54,673 over last year for salaries, PERA, workers comp insurance, motor fuels, equipment repairs, communications and financial services). He stated the budget was reviewed with Council at its August 17 work session. He stated the Fire Board approved the budget at their July 8 board meeting, and the Crystal City Council approved it at their August 18 Council Meeting. He stated Fire Chief Larson is available for any questions. RESOLUTION 2020-85 Item 10.1 Council Member Elder introduced the following resolution and moved its adoption: “RESOLUTION APPROVING WEST METRO FIRE-RESCUE DISTRICT 2021 BUDGET.” The motion for the adoption of the foregoing resolution was seconded by Council Member Frazier, and upon vote being taken thereon, the following voted in favor thereof: Hemken, Elder, Frazier, Hoffe , London; and the following voted against the same: None; Abstained: None; Absent: None; whereupon the resolution was declared duly passed and adopted, signed by the mayor which was attested to by the city clerk. New Hope City Council August 24, 2020 Page 4 TOBACCO ORDINANCE Item 10.2 Mayor Hemken introduced for discussion Item 10.2, Ordinance No. 20-08, An ordinance regulating the sale of tobacco and related devices and products within the city of New Hope and summary ordinance. Mr. Brandon Bell, community development assistant, reviewed the background of the tobacco use ordinance amendment. He sated the Council last discussed the ordinance amendment at a closed meeting on August 17, 2020, and the following changes were agreed upon: 1) adult only tobacco stores would be allowed to sell all flavors of tobacco and related products; 2) businesses with on-site pharmacies would be allowed to sell tobacco products; and 3) adult only tobacco stores would be able to distribute samples to their customers. Mr. Bell highlighted the proposed changes to the existing ordinance including  Revisions of many definitions in the city code  Mirrored the newest federal regulations including raising the legal age required to purchase tobacco products from 18 to 21 years old  Ban on all flavored cartridge-based e-cigarettes (except tobacco flavored)  Prohibits the sale of flavored tobacco products except for mint, menthol, and wintergreen and allow for the sale of all flavored products in adult only tobacco stores  Raises the limit of those legally allowed to sell tobacco products as a clerk at a licensed retailer to 18 years old  Possession, use and purchase laws have been removed that would punish people under the age of 21 who attempt to purchase tobacco  Caps the number of tobacco licenses allowed in the city to 21 (current number of tobacco licenses)  Changes the ages of persons allowed to conduct compliance checks to 17-20 years of age to align with state regulations  Increases the minimum penalty for a first time compliance check failure from $250 to $300 to align with state regulations  Increases the compliance check look back period from 24 to 36 months For the minutes, Mayor Hemken relayed a telephone conversation of August 24 between Brandon Bell and Francisco Elorriaga (4648 Maryland Avenue North of Crystal). Mr. Elorriaga called and stated he has been a regular customer at the Holiday, Hy-Vee other community convenience stores for years and feels it is illogical to limit the business where he can purchase flavored cigars. Mr. Elorriaga stated that if the flavor ban was about a public health initiative, then it does not do much with the current proposed amendment because people can still buy the products; you are just unfairly limiting where they can purchase them. Mr. Elorriaga wanted to officially have his opinion recorded that he is against a flavor ban, especially one that gives some stores an unfair advantage, limits his options unnecessarily and in his opinion does nothing to curb a public health matter. Mayor Hemken noted there were businesses who participated in the tobacco ordinance discussions. Mr. Bell clarified the licensees were from gas stations that viewed the initial ordinance amendment as a compromise based on a city -wide proposal. The same group has expressed their opinion that the current proposal seems unfair. New Hope City Council August 24, 2020 Page 5 Ms. Stacy Woods, city attorney, stated the ordinance requires a minimum of one compliance check per year. Council Member London noted the ordinance is adding restrictions above state law. He stated the action creates an uneven playing field to tobacco licensees as Tobacco Products Shops have less restrictions than other tobacco license holders. He questioned whether different license fees should be established. Mr. Bell stated there is no variation on license fees. It was noted that similar ordinances have been adopted at other cities (Robbinsdale, Duluth, Minneapolis, St. Paul, and Minnetonka). Council Member London pointed out that the city was lobbied by county health officials to make amendments to the tobacco ordinance before the “Tobacco 21” state law became effective. Council Member Frazier commented that the city attorney provided sound rationale regarding changes to the ordinance. He expressed support for adoption o f the ordinance amendment. ORDINANCE NO. 20-08 Item 10.2 Council Member Frazier introduced the following ordinance and moved its adoption including the 36-month lookback period: “ORDINANCE 20-08, AN ORDINANCE REGULATING THE SALE OF TOBACCO AND RELATED DEVICES AND PRODUCTS WITHIN THE CITY OF NEW HOPE, MINNESOTA (AND SUMMARY ORDINANCE)” The motion for the adoption of the foregoing ordinance was seconded by Council Member Elder, and upon vote being taken thereon, the following voted in favor thereof: Hemken, Elder, Frazier, Hoffe; and the following voted against the same: London; Abstained: None; Absent: None; whereupon the ordinance was declared duly passed and adopted, signed by the mayor which was attested to by the city clerk. EXCHANGE OF COMMUNICATION Item 12.1 Mayor Hemken introduced for discussion Item 12.1, Exchange of communication between members of the City Council. Mayor Hemken reported on upcoming events. ADJOURNMENT Motion was made by Council Member Frazier, seconded by Council Member Elder, to adjourn the meeting, as there was no further business to come before the Council. All present voted in favor. Motion carried. The New Hope City Council adjourned at 8:16 p.m. Respectfully submitted, Valerie Leone, City Clerk S:\September 14, 2020 City Council Meeting\6.2 Approval of Claims.docx Request for Action September 14, 2020 Approved by: Kirk McDonald, City Manager Originating Department: City Manager By: Kirk McDonald, City Manager Agenda Title Approval of claims through September 14, 2020 Requested Action Claims for services and commodities purchased through this period are listed on the Check Disbursement Report Attachments  Check Disbursement Report Agenda Section Consent Item Number 6.2 I:\RFA\City Manager\2020\delinquent util-set hrg\q-set assessment hrg delinquent 9.14.20.docx Request for Action September 14, 2020 Approved by: Kirk McDonald, City Manager Originating Department: Community Development By: Valerie Leone, City Clerk/Treasurer Agenda Title Resolution providing for hearing on assessments for 2020 delinquent utility service charges, administrative citations, and alarm and mowing charges Requested Action Staff recommends adoption of the resolution establishing a public hearing on October 12, 2020, to assess unpaid bills for utility bills, administrative citations, and alarm charges. Background As of September 3, 2020, the outstanding balance of unpaid utility bills was $281,554 (333 accounts). For comparison purposes, last year’s amount at this same time was $291,066. The amount of unpaid administrative citations is $34,770 (40 properties). The amount of unpaid alarm and mowing fees is $3,697 (18 accounts). A copy of the notification letter that was mailed in August is attached. A $50 assessment fee is added to each account that proceeds through the collection process. Many residents will make payments prior to October 19 to avoid the $50 fee. The City does not lose any money by certifying delinquent accounts. Property owners are required to pay penalties and accrued interest on delinquent accounts. Staff realizes financial assistance is extremely limited for persons having difficulty paying utility bills. Hennepin County has an “Economic Assistance” program to help individuals with their utility bills. They can be reached at (612) 348-3000. Attachments  Resolution  Notification Letter – Delinquent Utilities Agenda Section Consent Item Number 6.4 City of New Hope Resolution No. 2020- Resolution providing for hearing on assessments for 2020 delinquent utility service charges, administrative citations, and alarm and mowing charges BE IT RESOLVED by the Council of the City of New Hope, Minnesota, WHEREAS, Minnesota Statutes, Section 444.075 Subd. 3 and 429.101 Subd. 1 requires a proposed assessment roll shall be prepared by the City Clerk and made available for public inspection and that this Council shall consider said assessment roll at a public hearing after giving proper notice to the affected property owners. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of New Hope as follows: 1. The assessment rolls heretofore duly prepared for the above-described public services of the City of New Hope, and now on file in the office of the City Clerk, are hereby approved as the proposed assessments for said services and this Council shall meet at the time and place indicated in the attached notice for the purpose of passing upon said assessments and hearing all objections. 2. That the City Clerk is directed to publish in the New Hope-Golden Valley Post, the attached setting public hearing on October 12, 2020, to consider the proposed assessments. 3. That the City Clerk is directed to mail notice of said public hearing to all owners of each parcel described in the assessment rolls. Adopted by the City Council of the City of New Hope, Hennepin County, Minnesota, this 14th day of September, 2020. ______________________________________ Mayor Attest: __________________________________ City Clerk Date MDY PENDING ASSESSMENT NOTICE (This is the only notice you will receive) Dear Property Owner: The above-referenced “Service Address” has a past-due utility account. The delinquency may include charges for water, sewer, storm drainage, street lighting, weed removal, snow removal, diseased tree removal and recycling services that were assessed as of June 1, 2020. Payments will be accepted as follows: • To avoid an administrative charge of $50, the above “Amount Past Due” must be paid by 4:30 p.m. on Monday, October 19, 2020. • Payments made from Tuesday, October 20, 2020, through 4:30 p.m. on Monday, November 16, 2020, MUST include the $50 administrative charge. • In addition, payments made from Monday, November 9, 2020, through Monday, November 16, 2020, will ONLY be accepted in the form of cash, money order, or credit card (MasterCard, Visa, Discover, and American Express only). Checks will not be accepted. Payments must be made in person between the hours of 8:00 a.m. – 4:30 p.m., Monday through Friday excluding city holidays. • Payments can be made by phone 24/7 by calling (844) 869-3219. (VISA, MasterCard, Electronic Check) Delinquent balances not paid by 4:30 p.m. on Monday, November 16, 2020, will be assessed against the above property. This means that the delinquent balance will be reported to Hennepin County, which will then be added to the 2021 property tax statement for the “Service Address.” Assessed amounts will accrue interest at an annual rate of seven percent (7%) from November 1, 2020, through December 31, 2021. Certification letters will NOT be sent to properties with tenants. It is the owner’s responsibility to notify their tenants of any past due amounts that have been accrued throughout the year. The City Council will meet in the Council Chambers at New Hope City Hall, 4401 Xylon Avenue N., on Monday, October 12, 2020, at 7:00 p.m., or as soon thereafter as the matter may be heard, to consider assessments to be levied against properties benefiting from the services provided. Property owners may appear at this public hearing to object to proposed assessments against their property. If you wish, you may appeal the assessment of unpaid utilities to Hennepin County District Court under Minnesota Statutes, Section 429.081. To do so, you must: • File a signed, written objection to the amount of the assessment with the City Clerk prior to the October 12, 2020, assessment hearing, or present the written objection to the presiding officer at the assessment hearing; and • Serve notice of the appeal to the Mayor or the City Clerk within 30 days after the adoption of the assessment and file such notice with the District Court within 10 days after the notice was served to the Mayor or the City Clerk. If you have any questions regarding this matter, please call the City of New Hope Utility Billing Department at 763.592.6760. Thank you. CITY OF NEW HOPE 5500 International Pkwy ~ New Hope, Minnesota 55428-4858 ~ www.ci.new-hope.mn.us City Hall: 763.531.5100 ~ Police (non-emergency): 763.531.5170 ~ Public Works: 763.592.6777 City Hall Fax: 763.531.5136 ~ Police Fax: 763.531.5174 ~ Public Works Fax: 763.592.6776 Property Owner Address Line 1 ACCOUNT NUMBER : Account Number Property Owner Address Line 2 CUSTOMER NUMBER: Customer Number Property Owner Address Line 3 SERVICE ADDRESS: Service Address Property Owner Address Line 4 PROPERTY ID: Tax Roll Numeric Property Owner Address Line 5 AMOUNT PAST DUE: Current WO Balance Property Owner Address Line 6 ADD’L CHG AFTER 10/19/20: $ 50.00 I:\RFA\PUBWORKS\2020\Council\1048 2020-2021 Sewer Lining\Change Order 1 Request for Action September 14, 2020 Approved by: Kirk McDonald, City Manager Originating Department: Public Works By: Bernie Weber, Director Agenda Title Resolution approving Change Order No. 1 for Visu-Sewer Contract for the 2020 and 2021 Sewer Lining Project (Improvement Project No. 1048) Requested Action Staff requests to discuss Change Order No. 1 for the 2020 and 2021 Sewer Lining Project. Policy/Past Practice The city has a long history of completing initiatives to reduce inflow and infiltration in our sanitary sewer system. Background The city’s 2020 and 2021 capital improvement programs includes $700,000 for lining of the city’s sanitary sewer collection system, $350,000 each year. Visu-Sewer was the low-bid contractor for a total construction base bid for both years of $321,115.10. The 2020 project originally included the lining of approximately 5,890 feet of sanitary sewer main in the Liberty Park neighborhood, for a total construction cost of $151,784.50, considerably less than the budget CIP of $350,000. Staff has been reviewing with Visu-Sewer, the city engineer and the city attorney to discuss the possibility of adding work to the 2020 contract. The city attorney advised that no more than 25% of the original bid be added to the contract. Change Order No. 1 would add another 3,291 feet of sewer main lining to the 2020 project. The project area can be seen on the attached Location Map. In general, this area had been planned for lining in 2022 due to known infiltration issues. Change Order No. 1 identifies the cost of adding the 3,291 feet to the 2020 sewer lining contract. Total, Change Order No. 1 would add $73,699.25 to the Visu-Sewer contract. This is below the 25% threshold as recommended by the city attorney. Staff recommends approval of Change Order No. 1. Funding The sanitary sewer lining project is listed in the 2020 CIP at $350,000 and the 2021 CIP at $350,000. Change Order No. 1 would add $73,699.25 to the Visu-Sewer contract, bringing the total contract amount in 2020 to $225,483.75. Funding for the project would be from the sanitary sewer fund. Attachments  Resolution  Engineer’s Memo and Location Plan  Change Order No. 1 Agenda Section Development & Planning Item Number 8.1 I:\RFA\PUBWORKS\2020\Council\1048 2020-2021 Sewer Lining\Change Order 1 City of New Hope Resolution No. 20- Resolution approving Change Order No. 1 for Visu-Sewer Contract for the 2020 and 2021 Sewer Lining Project (Improvement project no. 1048) WHEREAS, the city has received the request for change order no. 1 from Stantec Consulting Services for the Visu-Sewer Contract for 2020 and 2021 Sewer Lining Project (Improvement Project No. 1048); and WHEREAS, the item in change order no. 1 is to have Visu-Sewer add the lining of 3,291 additional feet of sewer main lining to the contract; and WHEREAS, the original contract with Visu-Sewer was in the amount of $321,115.10, with $151,784.50 being spent on the 2020 portion of the project; and WHEREAS, change order no. 1 increases the total contract amount to $394,814.35; and WHEREAS, Stantec Consulting Services and staff have reviewed and recommend approval of the change order; and NOW, THEREFORE, BE IT RESOLVED by the City Council of the city of New Hope that change order no. 1 to the Visu-Sewer contract is approved and that all other respects of the contract shall remain in full force and effect according to its terms. Adopted by the City Council of the city of New Hope, Hennepin County, Minnesota, this 14th day of September, 2020. Mayor Attest: City Clerk Memo bd v:\1938\active\193804991\communications\correspondence\weber_boyum_memo_change_order_no.1_2020_09_01.docx To:Bernie Weber From:Dan D. Boyum Public Works Director City Engineer File:193804991, City Project No. 1048 Date:September 1, 2020 Reference: Change Order No. 1 - 2020 & 2021 Sanitary Sewer Lining The City monitored Inflow and Infiltration (I/I) flows in the northwest (NW) corner of the City as part of the 2019 monitoring and Metropolitan Council Environmental Services (MCES) Green Grant program. Based on those findings, the city plans to concentrate the next few years of sanitary sewer lining to this NW area. As discussed with Staff and the Council at the April 27, 2020 Council Meeting, the bids on the above referenced project came in significantly under the allocated budget and estimates. Staff has reviewed adding additional pipe lining in this NW area and discussed options related to this work with the City Attorney. Based on these discussions, staff is proposing the following: 1. Adding additional work to the 2020 project is shown in the attached figure and change order. Based on the bid unit pricing, the amount of this additional work would be +/- $73,699.25. This amount is within guidelines discussed with the City Attorney as follows: o not more than 25% of the original bid, so 25% of $321,115.10 = $80,278.78 o $73,699.25 < $80,278.78 2. Get quotes/bids in 2021 for additional sewer lining in this NW area, including larger piping (12”). Based on the additional quantities in Item 1 above, the Total Project Costs in 2020 are estimated as follows: Item Amount Base Bid Construction Cost - 2020 $151,784.50 Change Order No. 1 - 2020 $73,699.25 Total Construction Cost – 2020 $225,483.75 + Indirect Costs (20%)$45,096.75 Total Project Costs $270,580.50 The Total Project Costs of $270,580.50 is less than the 2020 Sewer Lining Budget of $350,000. We will plan on updating the City Council on Change Order No. 1 to be added to the 2020 Sewer Lining Project at the September 14, 2020 Council Meeting. Stantec Consulting Services Inc. Dan Boyum Phone: 612 712 2021 Dan.Boyum@stantec.com Attachment:Figure Drawing, Change Order No. 1 c. Kirk McDonald, Megan Hedstrom, Dave Lembke, Matt Rowedder, Stacy Woods, Lucas Miller, Ann Dienhart 0 200 400 FEET LEGEND STUDY AR EA SA NITARY STR UCTU RE LIFT STATIO N MANHO LE FOR CEMAIN GRAVITY PIPE DIAMETER UNKNOW N 4 INCH 6 INCH 8 INCH 9 INCH 10 INCH 12 INCH 15 INCH 18 INCH 21 INCH BASE MAPPING PARCEL CITY L IMITS CITY OF NEW HOPE FIGURE 1 - EXISTING SANITARY SEWER SYSTEM OC TOBER 2019 V:\1938\active\193804215\GIS\Projects\Figure 1 - Sanitary System.mxd The information on this map has been compiled by Stantec staff from a variety of sources and is subject to change without notice. Stantec makes no representations or warranties, express or im plied, as to accuracy, com pleteness,tim eliness, or rights to the use of such information.Stantec Consulting Services733 Marquette Ave. Suite 1000Minneapolis MN 55402612.712.2000 A79 A80A75C A84A A92 A57A59 A75 A74 A74A A75A A37 A38 A40 A75B BOONE AVE N62ND AVE N NEW HOPEPUBLIC WOR KS LIFT S TATIO N #4 INTERNATIONAL PARKWAY B A S S L A K E R D BOONE AVE NRESEARCH CENTER RD. Date September 2, 2020 Bond No: MNC68275 Description of Work Contract Unit Total No.Item Unit Quantity Price Amount CHANGE ORDER NO. 1 1 TRAFFIC CONTROL LS 1 $300.00 $300.00 2 BYPASS PUMPING LS 1 $1,000.00 $1,000.00 3 HYDROPHILIC END SEAL (9")EA 32 $10.00 $320.00 4 SEWER REHABILITATION WITH CIPP, 9" VSP LF 3291 $21.75 $71,579.25 5 CUT BACK LATERAL LINER EA 1 $500.00 $500.00 $73,699.25TOTAL CHANGE ORDER NO. 1 Owner: City of New Hope, 4401 Xylon Ave. N., New Hope, MN 55428 Contractor: Visu-Sewer, Inc. W230N4855 Betker Drive, Pewaukee, WI 53072 Merchants National Bonding Company (Mutual) PO Box 14498, Des Moines, IA 50306 This Change Order provides for additional residential 9" VSP sewer rehabilitation with CIPP along streets in the northwest corner of New Hope to the 2020 Sanitary Sewer Lining Project. The additional work includes cutting back on a service lateral at a specific address. This Change Order does not provide for any change in the Substantial or Final Completion dates for this project. CHANGE ORDER NO. 1 2020 & 2021 SANITARY SEWER LINING CITY PROJECT NO. 1048 STANTEC PROJECT NO. 193804991 193804991CHO1.xlsm Original Contract Amount $321,115.10 Previous Change Orders $0.00 This Change Order $73,699.25 Revised Contract Amount (including this change order)$394,814.35 CHANGE IN CONTRACT TIMES Original Contract Times: Substantial Completion (days or date): Ready for final Payment (days or date): Increase of this Change Order: Substantial Completion (days or date): Ready for final Payment (days or date): Contract Time with all approved Change Orders: Substantial Completion (days or date): Ready for final Payment (days or date): Recommended for Approval by: STANTEC Date: Approved by Contractor:Approved by Owner: VISU-SEWER, INC.CITY OF NEW HOPE Date Date cc: Owner Contractor Bonding Company Stantec 193804991CHO1.xlsm I:\RFA\City Manager\2020\Budget 2021\Council 091420\10.1 Q-council support EDA levy 9.14.20.docx Request for Action September 14, 2020 Approved by: Kirk McDonald, City Manager Originating Department: City Manager By: Kirk McDonald, City Manager Agenda Title Resolution authorizing the preliminary EDA levy for 2021 Requested Action Staff requests the City Council adopt the attached resolution relating to the preliminary EDA levy for 2021. Background The resolution before the City Council supports the $365,000 EDA levy. It is necessary to adopt the preliminary EDA levy separate from the city’s base levy. The EDA must also approve the levy. AEM and staff recommend the EDA levy be set at $365,000 for year 2021. Minnesota Statutes permit the EDA to levy up to .01813% of the estimated market value in the city, and this levy meets those requirements. The total estimated market value is estimated by Hennepin County at $2,106,273,300; ($2,106,273,300 x .0183% = $381,867). The EDA levy could be increased to $381,867 (an increase of $16,867 over the proposed levy of $365,000) if the Council so desires. However, a goal for 2021 was to keep the total tax levy to a minimum. This is a $17,000 increase, as the 2020 EDA levy was $348,000. The increase will help fund the scattered site housing program. The EDA levy will be discussed further during the budget review process and can be reduced if the Council so directs. The EDA levy has a minimal impact on the overall city tax levy. Attachments  Resolution  Hennepin County Levy Limitation Agenda Section Ordinances & Resolutions Item Number 10.1 City of New Hope Resolution No. 2020- Resolution authorizing the preliminary EDA levy for 2021 WHEREAS, pursuant to Minnesota Statutes, Section 469.090 to 469.108 (the “EDA Act”), the City Council of the City of New Hope created the City of New Hope Economic Development Authority (the “Authority”); and WHEREAS, Section 469.033, subdivision 6 of the Act authorizes the Authority to levy a tax upon all taxable property within the City to be expended for the purposed authorized by the EDA Act; and WHEREAS, such levy may be in an amount not to exceed .0185 percent of estimated market value of the City; and WHEREAS, the Authority has filed its budget for the special benefit levy in accordance with the budget procedures of the City in the amount of $365,000; and WHEREAS, based upon such budgets the Authority will levy all or such portion of the authorized levy as it deems necessary and proper; NOW THEREFORE BE IT RESOLVED by the City of New Hope City Council: 1. That approval is hereby given for the Authority to levy, for taxes payable in 2021, such tax upon the taxable property of the City as the Authority may determine, subject to the limitations contained in the EDA Act. Adopted by the New Hope City Council on September 14, 2020. ____________________________________ Mayor Attest: City Clerk I:\RFA\City Manager\2020\Budget 2021\Council 091420\10.2 Q -Property Tax Levy 9.14.20.docx Request for Action September 14, 2020 Approved by: Kirk McDonald, City Manager Originating Department: City Manager By: Kirk McDonald, City Manager Agenda Title Resolution approving 2021 proposed general fund budget and preliminary property tax levy, and setting public hearing date for the 2021 budget and preliminary property tax levy Requested Action Staff requests the City Council adopt the attached resolution for the preliminary 2021 budget and authorize the city clerk to certify the proposed tax levy information to the county auditor no later than September 30, 2021, as required by law. Representatives from AEM, the city’s financial consultant, will be in attendance to assist the city manager with the presentation and answer questions. Per AEM, a separate EDA meeting is necessary to adopt the preliminary EDA levy separate from the city’s base levy. Per changes during the 2017 legislative session, the EDA levy can be now be adopted after the city’s levy and this item has been placed on the EDA agenda following the adjournment of the council meeting. Policy/Past Practice It has been the past practice of the City Council to adopt a preliminary budget and maximum tax levy at the first council meeting in September, with the understanding that the budget will be reviewed in detail over the next several months before the final budget and tax levy are adopte d in December. It has also been the past practice of the Council to schedule a separate public hearing meeting to take comments on the budget, prior to the council meeting when the budget is formally adopted. Background As discussed at the August 17 council work session, the City Council is being requested to adopt the preliminary maximum property tax levy and a proposed preliminary tax supported budget at the September 14 council meeting so the documents can be submitted to Hennepin County and the Minnesota Department of Revenue by the September 30 deadline. The Council is also requested to schedule the budget public hearing for December 7, 2020. 2021 Tax Levy The tax levy for the general fund is $10,879,465, which is $368,034 or a 3.5% increase over the 2020 general fund levy of $10,511,431. The total tax levy for 2021, including the general fund, street and park infrastructure funds, economic development authority and prior levies for City Center, Northwood South and Northwood North infrastructure bonds, the 2017 police station/city hall facility bonds, and the 2018/2019 pool and park improvement bonds is $17,417,601. This represents a 3.4% or $572,885 increase over the 2020 levy of $16,844,716, which was a 10.08% increase. The total tax levy includes a 5% increase in the street and park infrastructure levies to support the long-term funding plans for street and park improvements. An additional $100,000 has been added to the park infrastructure levy for ice arena debt service and capital Agenda Section Ordinances & Resolutions Item Number 10.2 Request for Action, Page 2 improvements (final year of increase), per the funding plan approved by the Council. A $17,000 increase in the EDA levy is recommended to support the scattered site housing program and other redevelopment. Four of the debt bond tax levies are decreasing (2015 City Center, 2015 Northwood South, 2017 City Hall and 2019 Pool and Park) for a total decrease of $7,285. Two of the debt bond tax levies are increasing are increasing (2016 Northwood North and 2018 Pool and Park) for a total increase of $3,674. Overall, the combined debt levies are decreasing by $3,611. The median home value for taxes payable in 2021 is $257,000, which is a 5.33% increase from the median value home in 2020. At this time the estimated impact on residential homes based on the proposed 3.4% increase in the city tax levy is 2%. For homes valued between $150,000 and $400,000 the tax increase is estimated to be $14 to $43. The city tax rate is projected to decrease from 64.721% in 2020 to 62.471% in 2021. The tax levy resolution included with this request for $17,052,601 excludes the $365,000 EDA tax levy ($17,417,601 less $365,000), as the EDA tax levy must be acted upon by the EDA. 2021 Budget The 2021 general fund budget is $15,936,977, which is an increase of $526,427 (3.4%) over the 2020 budget of $15,410,550. The major changes in the budget include:  An increase of $243,524 for wage and benefit increases ($193,013 in police department and $50,511 for other departments); a 3% cost of living adjustment is budgeted for employees along with an increase in the city’s share of health insurance coverage; and a 3% increase in City Council salaries is included in the budget (to be considered in October 2020).  $156,000 is budgeted for phase 1 of police department body and squad camera purchases (phase 2 scheduled for 2022). It is recommended that this cost be funded with a transfer in from the IT reserve fund (utilized for IT purposes including security systems at city facilities) in order to keep the general fund tax levy to a minimum.  There is an increase of $85,288 in the budget for West Metro Fire-Rescue District due to a $54,673 or 4.2% increase in New Hope’s share of the joint powers agreement and a $35,778 increase in central garage charges due to a new replacement charge for the new emergency generator shared between the fire district and the police station/city hall facility.  General fund central garage charges increased by $57,427 based on the equipment replacement schedule and include a 100% replacement charge and a portion of the $400,000 building replacement charge for future public works facility improvements. Department allocations were adjusted according to the long-term replacement plan, with some increases and some decreases.  The city is scheduled to receive $865,307 in LGA (local government aid) in 2021, which is an increase of $49,684 over 2020. The revenue will be utilized in the general fund to offset central garage equipment and building replacement charges; it is not used for general operations. The total cost of general fund equipment/building replacement charges in 2021 is $917,949 so LGA does not cover the full amount; approximately $52,642 is needed from other revenue sources.  2021 is not an election year so there is a decrease of approximately $60,000 in the elections budget as compared to the 2020 budget. In 2020 funds were budgeted for three elections (Presidential Primary, Primary, and General). Funds are budgeted for equipment maintenance and postage expenses. Request for Action, Page 3  There is a $49,000 increase in the city hall budget due to the new replacement cost for the new generator ($24,000) and increases in utility costs and liability insurance for a larger building ($22,000 and $17,000, respectively); offset by a $14,000 decrease in repairs, furniture/fixtures and postage.  Similar to 2020, in 2021 general fund IT charges will increase approximately $33,000 and are based on the new allocation method implemented in 2020 for indirect charges (number of phones, computers and employees per department), with direct departmental Logis IT costs being allocated to the benefitting department.  There is $99,506 in revenue increases budgeted for an increase in right-of-way and easement fees, franchise fees, and state aid for streets and police pensions.  There is a $60,000 decrease budgeted for police charge outs due to the uncertainty of the school resource officer program. The 2021 budget goals are listed in the preliminary budget binder and are the same goals discussed at the June and August work sessions. Over the next several months, all budgets will be reviewed with the City Council in detail. All department heads will be in attendance at the September 21 council work session to review their general fund budgets. Enterprise and utility fund budgets will be reviewed and discussed at the October 19 work session. Representatives from AEM will be in attendance at the work sessions as well. Budget discussions will continue in October and November, including discussion regarding cost of living wage adjustments and insurance contributions. A special public hearing meeting for public input is recommended to be held on December 7, and the date is specified in the attached resolution. A final budget will be presented to the Council for adoption at the December 14 council meeting. Staff recommends approval of the resolution approving the 2021 preliminary budget and tax levy and scheduling the public hearing for December 7, 2020. Attachments  Resolution  Presentation City of New Hope Resolution No. 2020- Resolution approving 2021 proposed general fund budget and preliminary property tax levy, and setting public hearing date for the 2021 budget and preliminary property tax levy WHEREAS, the City of New Hope is required by State law to approve a resolution setting forth an annual tax levy to the Hennepin County Auditor; and WHEREAS, Minnesota Statues require approval of a preliminary property tax levy and preliminary budget on or before September 30th of each year; and WHEREAS, the City Council has received the proposed budget document; NOW THEREFORE BE IT RESOLVED by the City Council of the City of New Hope, that the Preliminary 2021 General Fund budget shall be as follows: BE IT FURTHER RESOLVED that the Truth in Taxation Public Hearing will be held on December 7, 2020; and BE IT FURTHER RESOLVED that the City Council of the City of New Hope, Hennepin County, Minnesota, that the following sums of money be levied for collection in 2021 upon the taxable property in said City of New Hope for the following purposes: BE IT FURTHER RESOLVED that the 2015B GO Imp Bonds (Northwoods South) levy is hereby adjusted from the scheduled amount of $192,813 to $206,828 to provide adequate cash flow to service the debt; BE IT FURTHER RESOLVED that the 2018A GO Tax Abatement Bonds (Pool and Park) are hereby adjusted from the schedule amount of $377,464 to $867,464 to include the tax abatement levy portion of the levy; BE IT FURTHER RESOLVED that the 2019A GO Tax Abatement Bonds (Pool and Park Ph. 2) are hereby adjusted from the schedule amount of $119,248 to $468,248 to include the tax abatement portion of the levy; BE IT FURTHER RESOLVED that the City Clerk is hereby authorized and directed to transmit this information to the County Auditor of Hennepin County, Minnesota and the Minnesota Department of Revenue, if applicable, in the format requested as required by law. Adopted by the New Hope City Council on September 14, 2020. _______________________________________ Mayor Attest: City Clerk 2021 PRELIMINARY BUDGET City of New Hope Council Presentation • Sept. 14, 2020 Presentation Outline Review budget process Review past tax levies and bonds Review Local Government Aid (LGA) Present preliminary general tax levy Review specific tax levy detail Property tax levy limits 2 Review Budget Process September 14, 2020 Present 2021 preliminary tax supported budgets Present 2021 preliminary tax levy (maximum amount) September –November, 2020 Review general fund budget detail Review enterprise fund budget detail December 7, 2020 Public input meeting 3 Review Budget Process December 2020 Present approved budgets and tax levy –Final meeting December 14, 2020 Certify final levy to Hennepin County Auditor and Department of Revenue 4 Past Levies and Bonds, LGA Used For Equipment Replacement Funding 2018 Budget 7.9% levy increase over 2017 (added bonds for Northwood North street infrastructure project and Park Infrastructure levy increase for ice arena debt) $693,114 LGA received Full LGA used to help cover general fund equipment replacement costs (100%) plus $160,000 from General Fund tax levy LGA not used for general operations 5 Past Levies and Bonds, LGA Used For Equipment Replacement Funding 2019 Budget 18.50% levy increase over 2018 (13.24% was for addition of bonds for new police station/city hall facility). The levy increase would have been 5.26% without the facility bonds. $697,864 in LGA received Full LGA used to help cover general fund equipment replacement costs (100%) plus $250,000 from General Fund tax levy LGA not used for general operations 6 2020 Tax Levy, Bonds and Use of LGA 2020 Budget 10.08% levy increase over 2019 (8.72% was for addition of bonds for new pool and park improvements). The levy increase would have been 1.36% without the pool/park bonds. $815,623 received in LGA Full LGA used to help cover general fund equipment replacement costs (100%) plus $121,534 from General Fund tax levy LGA not used for general operations 7 Proposed 2021 Tax Levy, Bonds and Use of LGA 2021 Budget 3.4% levy increase over 2020 No new bonds for 2021. Four of the previous debt bond tax levies are decreasing. Scheduled to receive $865,307 in LGA ($49,684 increase over 2020) Full LGA amount to be used to help cover General Fund central garage equipment/building replacement costs (100%) plus $52,642 from General Fund tax levy LGA not used for general operations 8 Central Garage Fund Equipment/ Vehicle Replacement In past years funds have been budgeted for both: Operations (gas, oil, tires, maintenance) Replacement (savings for future replacement) Includes variety of city vehicles/equipment (snowplows, police vehicles, trucks, etc.) Equipment replaced only when necessary –often delayed From 2010-2013, replacement charges were reduced in general fund due to sharp reduction in LGA to keep tax levy low Goal to incrementally increase general fund replacement cost to 100% achieved in 2017. Also saving annually for future improvements to central garage facility. 9 General Fund Budget Major increases/changes include: $243,524 increase to fund 3% increase in wages/benefits; increase in Council salaries $156,000 increase for Phase 1 of police department body and squad camera purchases (funded by IT reserve) $85,288 increase for West Metro Fire-Rescue District ($54,673 for JPA ; $35,778 for new shared emergency generator replacement charge) $57,427 increase in central garage charges based on equipment replacement $49,000 increase in city hall budget due to $24,000 replacement cost for new generator, increases in utility costs ($22,000) and liability insurance ($17,000) for larger building $60,000 decrease in elections budget; 2021 is not an election year 10 2020 Adopted Budget 2021 Requested Budget 2020 to 2021 Increase 2020-2021 % Increase $15,410,550 $15,936,977 $526,427 3.4% Street & Park Infrastructure Key points: New Hope does not assess taxable properties for street improvements. Street and Park infrastructure improvements are paid through the general property tax levy (commenced with 2001 tax levy). Levies for street and park infrastructure funds were increased by 3% in 2015 (first increase since 2009). A 5% increase for street infrastructure is proposed in the 2021 budget (increase of $73,367). A 5% increase for park infrastructure is proposed in the 2021 budget (increase of $18,365, plus an additional $100,000 to assist with ice arena debt service and capital improvements). Overall tax rate may appear high when compared to other cities due to New Hope including infrastructure improvements in general property tax levy rather than assessing to benefitting property owner (street levy is approximately 13% of local tax levy). 11 2021 Budget Initiatives Key points: Continue to provide existing services/programs with current resources. Utilize $865,307 of LGA in the general fund to help fund equipment replacement savings at 100% level (not utilized for general operations). Public safety is a high priority; implement Phase 1 purchase of body worn camera systems and replacement of squad camera systems/software. Support/coordinate with West Metro Fire-Rescue District I partnership with Crystal; including emergency preparedness training and support of long-term capital plan based on major apparatus report. Redevelopment of city center and other areas is a high priority as well as completion of Windsor Ridge single-family home development. 12 2021 Budget Initiatives Key points (continued): Property maintenance and inspections to continue as top priority; continue aggressive scattered site housing program to remove or renovate deteriorated homes and increase property values with new construction or rehabilitation. Continue infrastructure/environmental improvements; complete final wear course on 2020 reconstruction project (Northwood Parkway and 36 ½ Circle North), 2021 street infrastructure improvements in Lions Park neighborhood and Erickson Drive, annual seal coat/crack repair/fog seal improvements and sewer lining, coordinate on Meadow Lake drawdown and golf course pond improvements. Continue to review public works facility improvements, continue coordination with Joint Water Commission and maintain partnerships with Northwood Lake and Meadow Lake Watershed Associations. 13 2021 Budget Initiatives Key points (continued): Open new aquatic facility for 2021 season, replace playground equipment at Corner Park, replace basketball court at Little Acre Park and make parking lot repairs at Hidden Valley and Lions Park. Facility improvements to include: Ice Arena –Replacement of south rink roof, replacement of radiant heaters at north rink and weight room upgrades Golf Course –Replacement of clubhouse HVAC, painting maintenance shop and replacement of tee protector fence on hole #1 Continue dance, gymnastics, and Movies in Park Program Continue Emerald Ash Borer removal/replacement program on public property and buckthorn removal in parks 14 2021 Budget Initiatives Key points (continued): Continue contractual arrangement with Solution Builders for IT services. Continue financial services contract with AEM, update ten- year financial plan, pavement management plan and long- term capital improvements plan. Conduct professional city-wide survey with Morris Leatherman to solicit resident feedback on city services/programs/issues, encourage public participation on city projects and promote inclusiveness. Continue MN Green Step Cities Program Cost of living increase (3%) and shared increase for insurance contributions included for employees; Council salary adjustments. 15 2021 Budget Initiatives Key points (continued): Orient any new residents elected to serve on City Council to city departments, programs and operations 16 2020 Legislative Session Impacts No levy limits; LGA budget increased to $865,307* (budgeted $807,579 in 2020); No change in PERA employer retirement contributions for 2021; Potential grant funding from MN Secretary of State for Election expenses, including: health and safety of officials and voters, public outreach related to social distancing, facilitation of absentee voting, etc. *In early August, the City’s 2021 LGA was certified by MN Department of Revenue at $861,726. 17 General Fund Revenues 2019 & 2020 Adopted Budgets & 2021 Preliminary Budget 18 Taxes and franchise fees Intergovernmental Charges and fees Other Transfers in 2019 Budget $10,854,805 $1,253,072 $1,498,960 $285,000 $332,275 2020 Budget $11,024,175 $1,405,262 $2,356,825 $285,000 $339,288 2021 Preliminary $11,415,965 $1,490,177 $2,310,160 $270,000 $450,675 $- $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 2021 LGA Compared With Last 10 Years 19 $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 General Fund Expenditures 2019 & 2020 Adopted Budgets & 2021 Preliminary Budget 20 General government Public safety Public works Parks and recreation 2019 Budget $1,924,638 $8,627,519 $1,563,038 $2,108,917 2020 Budget $2,038,450 $8,869,299 $1,620,168 $2,882,633 2021 Preliminary $2,061,129 $9,302,404 $1,655,393 $2,918,051 $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 $9,000,000 $10,000,000 THE PROPOSED TAX LEVY 21 2020 Levied 2021 Requested Increase / Decrease Program or service Base Levy General fund 10,511,431$ 10,879,465$ 368,034$ 3.50 2.18 % Street Improvements 1,467,333 1,540,700 73,367 5.00 0.44 Park Improvements (1)767,290 885,655 118,365 15.43 0.70 Economic Development Authority 348,000 365,000 17,000 4.89 0.10 Debt Service - 2015A GO TIF Bonds (City Center)240,162 237,747 (2,415) (1.01) (0.01) 2015B GO Imp Bonds (Northwoods South)207,663 206,828 (835) (0.40) (0.00) 2016A GO Imp Bonds (Northwoods North)259,142 260,979 1,837 0.71 0.01 2017A GO Bonds (Police Dept/City Hall)1,709,190 1,705,515 (3,675) (0.22) (0.02) 2018A GO Tax Abatement Bonds (Pool and Park)865,627 867,464 1,837 0.21 0.01 2019A GO Tax Abatement Bonds (Pool and Park Ph. 2)468,878 468,248 (630) (0.13) (0.00) Total Property Taxes 16,844,716$ 17,417,601$ 572,885$ 3.40 3.40 % (1)Includes an increase of 5% as the annual Park Infrastructure Levy increase, plus an additional $500,000 levy to support Ice Arena debt service. % Change from % of Total Change COMPARISON OF PROPERTY TAXES PROPERTY TAX LEVY - ALL FUNDS Tax Capacity Information 2021 Tax levy impact will vary by property type Commercial/Industrial properties have higher tax rates than Residential/Apartment properties Tax impact is based on estimated market value Parcel specific tax estimates prepared by county 22 Summary of Tax Capacities 23 Property Type 2018 Pay 2019 2019 Pay 2020 2020 Pay 2021 Percent Commercial 1,896,644$ 2,146,169$ 2,199,129$ 2.47% Industrial 5,864,347 6,549,850 7,206,140 10.02% Apartment 3,612,291 4,315,000 4,845,617 12.30% Residential 11,133,514 11,970,207 12,710,746 6.19% Total 22,506,796$ 24,981,226$ 26,961,632$ 7.93% New Hope Tax Capacities Amounts for 2020 Pay 2021 are from the Assessor's July 2, 2020 Property Type Table release and represent an estimate for the 2021 tax capacity. Personal Property tax capacity is not included in these reports. Local Tax Rate 24 (1)Source: Hennepin County Tax Capacity Values by City/Town for Taxes Payable 2021 Proposed (2)Source: Hennepin County Table VIII Computation of Area Wide Distribution Levy for Taxes Payable in 2021 (3)Amounts for county, school and other districts are not known at this time. Prior year actual tax rates have been used for this illustration. Payable 2019 Payable 2020 Payable 2021 Tax Capacity 22,781,828 25,296,074 27,383,824 (1) TIF Captured Value (948,691) (1,378,781) (1,566,416) (1) Fiscal Disparities Contribution (2,870,420) (2,941,213) (3,317,874) (1) Net Tax Capacity 18,962,717 20,976,080 22,499,534 Certified Levy 15,301,610 16,844,716 17,417,601 Fiscal Disparities Distribution (2,372,842) (2,920,937) (2,996,822) (2) Local Levy 12,928,768 13,923,779 14,420,779 Tax Rate Trends 2019 2020 2021 City Tax Rate 66.598%64.721%62.471% EDA Tax Rate 1.392%1.368%1.368%(3) County Tax Rate 41.861%41.084%41.084%(3) School Tax Rate 29.909%26.447%26.447%(3) Other Tax Rate 8.885%8.376%8.376%(3) Total Tax Rate 148.645%141.996%139.746% Tax Levy Effect on a Home The following table summarizes the estimated tax impact on residential homes, based on the proposed increase in city tax levy: 25 City Tax Rate For Past 10 Years 26 City Rate % Change EDA Rate % Change 2012 54.81 11.99%0.00 N/A 2013 58.81 7.30%0.00 N/A 2014 58.60 -0.37%0.00 N/A 2015 54.93 -6.25%1.04 N/A 2016 56.67 3.16%0.74 -29.41% 2017 58.88 3.90%1.05 42.88% 2018 57.71 -1.98%0.88 -16.43% 2019 66.60 15.40%1.39 57.95% 2020 64.72 -2.82%1.37 -1.58% 2021 62.47 -3.48%TBD TBD Data obtained from Hennepin County Rate Cards for 2012-2020. The 2021 tax rate is estimated based on preliminary tax capacity information. The final rate will vary from the rate estimated in this presentation. 2021 Current Budget Summary Fund balance maintains close to 50% of expenditures if this budget is maintained Overall levy increase is 3.4%. Prior year increase was 10.8% LGA to be used for equipment replacement savings – not general operations 27 2021 Preliminary Budget Data Council and staff will continue to review budgets and programs Tax supported and rate supported budgets will be reviewed and finalized Final document will be submitted to Council in December 2020 for adoption Budget document also available at city hall 763-531-5117 cityhall@newhopemn.gov 28 Property Tax Relief Programs State provides direct property tax relief to taxpayers Homestead credit refund Renter’s refund Special property tax refund (referred to as the targeting program) Senior Citizen Property Tax Deferral Program. Contact MN Dept of Revenue 651-296-4444 or www.revenue.state.mn.us 29 S:\September 14, 2020 City Council Meeting\12.1 Q - Upcoming Events.docx Request for Action September 14, 2020 Approved by: Kirk McDonald, City Manager Originating Department: City Manager By: Kirk McDonald, City Manager Agenda Title Exchange of communication between members of the city council Upcoming meetings and events: Sept. 15 7:30 a.m. – District 281 Government Advisory Council Meeting (Virtual) Sept. 16 5:30 p.m. – North Metro Mayors Association Board of Directors Meeting at Ramsey Sept. 17 7:30 a.m. – Northwest Cable Television Cable Board Meeting 8:30 a.m. – Bassett Creek Watershed Management Commission Meeting (Virtual) Sept. 19 9 a.m. to 1 p.m. – New Hope Community Farmers Market Sept. 21 6:30 p.m. – City Council Work Session (In person – Civic Center Conference Room) Sept. 23 3:15 p.m. – District 281 Partnership Meeting (Virtual) Sept. 26 9 a.m. to 1 p.m. – New Hope Community Farmers Market Dusk - Movie in the Park at the Performance Center, “Captain Marvel”, sponsored by The New Hope Lions. Sept. 28 7 p.m. – City Council Meeting (In person – Council Chambers) Agenda Section Other Business Item Number 12.1