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01/27/1998 - City Council Special OU031 MINUTES OF A SPECIAL MEETING OF THE EAGAN CITY COUNCIL Eagan, Minnesota January 27,1998 A special meeting of the Eagan City Council was held on Tuesday, January 27, 1998 at 5:30 p.m. in the Eagan Municipal Center Community Room. Present were Mayor Egan and City Council members Awada, Blomquist, Masin and Wachter. Also present were Communications Coordinator Foote, Assistant to the City Administrator Hohenstein, Chief of Police Geagan, Director of Parks & Recreation Vraa, Director of Public Works Colbert, Director of Finance VanOverbeke and City Administrator Hedges. VISITORS TO BE HEARD Mayor Egan acknowledged that there were no visitors to be heard. COTTAGE GROVE REQUEST TO SUPPORT COMPENSATION FOR LOCATION OF A METROPOLITAN WASTEWATER TREATMENT PLANT City Administrator Hedges stated that he was contacted by the City Administrator of Cottage Grove and informed that the Metropolitan Council is proposing a wastewater treatment plant in that community. He stated that the Cottage Grove City Council has proposed legislation that would provide compensation to a political subdivision for the certain loss of revenue if a tax exempt regional wastewater treatment facility is located within that community. City Administrator Hedges stated that according to the Metropolitan Council, regional infrastructure will serve 3.2 million persons by the year 2040, served by seven wastewater treatment plants. City Administrator Hedges stated that the cities that are expected to be host communities for all wastewater treatment in the entire seven county metropolitan area are Eagan, Shakopee, Cottage Grove, Hastings, Oak Park Heights, St. Paul and Empire Township. He stated that a bill has been introduced, 473.545, that reads as follows, "A political subdivision within the metropolitan area that loses tax revenues as a result of the tax exemption for regional wastewater treatment facilities under Subdivision 1 must be compensated on an annual basis by the Metropolitan Council out of revenues received from sewer availability charges in an amount equal to the loss of property tax revenue to the political subdivision under Subdivision 1." He further stated that the proposed legislation is similar to relief that is provided those communities that have landfills located within their corporate boundaries. After a brief discussion, the City Administrator was given direction by the City Council to support the legislation being proposed by Cottage Grove. RON RASMUSSEN PROCLAMATION City Administrator Hedges stated that a request has been made by Mr. Dan Klekner, the newly elected President of the EAA, that an official proclamation recognizing Ron Rasmussen for his extraordinary years of service as a member and leader of the Eagan Athletic Association be considered by the City Council. City Council members endorsed the proclamation for signature by the Mayor. 1998 WORK PROGRAM City Administrator Hedges presented the 1998 work program, which contains both non- capital and capital projects that are under some level of consideration by the City Council. He stated that the status for these projects range from concept, such as housing, maintenance and home occupation ordinances, to actual bidding, which is the case with the second ice sheet capital project. City Administrator Hedges stated that the objective for the review is to make certain the 'work program projects, strategic plan and action steps for each of the projects are consistent with the City Council direction. City Council members expressed concern as to whether all the projects could be coordinated and completed during 1998. City Administrator Hedges stated that the work program is ambitious and will require careful coordination in order to complete each of the projects as listed. The City Administrator further stated that, 00032 Page 2/Eagan Special City Council Meeting Minutes January 27, 1998 similar to previous years, he organizes employee teams to manage each of the work program projects with his office overseeing and providing direction on all the projects on behalf of the City Council. He further stated that it is important that the City Council and management team recognize how full the Council docket is for 1998, which also provides a context for other issues that may come up during the year and require Council or staff consideration. City Council member Awada stated that, in her opinion, it was not necessary to have a strategic planning retreat with a facilitator to identify goals given the work program for 1998 outlined by the City Administrator. She further stated that it would be appropriate to hold a Saturday retreat to consider the development of ordinances relative to home occupation, property maintenance and the sign ordinance. City Councilmember Blomquist suggested that the City Administrator provide the facilitation at the retreat and other workshops the City Council schedules throughout 1998 for the purpose of developing ordinances, as well as brainstorming general policy. It was also agreed by the City Council that the amphitheater capital project is a low priority given all the capital projects for implementation in 1998. Mayor Egan stated that, along with the City Administrator, they will continue to work with the Eagan Rotary Club on that proposed project in hopes that the magnitude of the amphitheater can be scaled back to a smaller structure, such as a traditional bandshell, as suggested by the City Council. After further discussion and review on the work program, Mayor Egan thanked the City Administrator for his coordination and presentation, which provides a working text for major policy discussions during 1998. STREET CONSTRUCTION POLICIES City Administrator Hedges stated that at the Special City Council meeting held on January 20, City Councilmember Wachter, acting as Chairperson of the Public Works Committee, suggested that the City Council discuss policies relative to street construction. He further stated that City Council member Blomquist has raised several questions about various policies pertaining to street construction, both to the City Council and City staff during 1997. City Administrator Hedges stated that the main topics relative to street construction include: 1) how the overall appraisal system works relative to special assessments for street construction; 2) discussion regarding the difference in street construction, whether it is a capital project or repair; 3) discussion regarding the quality of the information provided for decision-making; 4) review the overall budget and funding for street construction; and 5) review why the administrative costs are exceeding 30% of the project cost for street construction projects. Mayor Egan asked for a general discussion regarding the five points that were presented by City Council member Blomquist and outlined by the City Administrator. City Councilmembers asked that an explanation be given as to why the administrative costs are exceeding 30% of the project cost for street construction projects. Director or Finance VanOverbeke presented a list of the various elements that are included in the administrative cost category, stating that all costs, exclusive of the actual construction, such as administration, legal, contingency, right-of-way and easement acquisition, and engineering deSign and inspection are defined as administrative costs. City Council member Blomquist suggested that the interest charges were a hidden tax and not an appropriate component of the total project cost. City Council member Awada explained that interest on the borrowing during the time of the construction is similar to taking out any construction loan. The process is similar to building a house where the interest on the construction loan becomes a part of the permanent financing. Mayor Egan pointed out that the citizens of Eagan at large should not be paying the interest for someone else's construction project. Finance Director VanOverbeke stated that it would not be appropriate to use City funds that would otherwise be invested to pay for construction financing without being paid interest. He stated that bonding earlier in the process could change the current arrangement; however, it would add a great deal of uncertainty and have a greater potential to raise costs rather than to lower them. Finance Director VanOverbeke stated that the costs are reasonable and legitimate with the real question being, who is going to pay them - the benefiting property owners or the community at large? No action was taken to change current practice. 00033 City Councilmember Blomquist stated that she has heard from residents requesting copies of appraisals which currently are not made accessible to the public. She further stated that if the City pays for the appraisal, it should be available for public review. She further stated that if the appraisals are not accessible to the public, it makes the City look like we are hiding information. Mayor Egan stated that an appraisal is considered work product for the City Attorney's office and is used in the case of a special assessment appeal. Mayor Egan suggested that the City Council communicate to the public why the appraisal is kept in the attorney's office. He further stated that the City Council has a responsibility to those homeowners who may incur a special assessment; however, there is also a responsibility to the entire community if an assessment should be appealed. Mayor Egan further stated that it is his understanding that it is not the appraisal amount, it is the methodology in which the appraisal is calculated that should remain as work product if the City should go to litigation on a special assessment appeal. City Administrator Hedges stated that City Council member Blomquist received correspondence from State Representative Pawlenty stating that "He could find no law requiring appraisals before special assessments are proposed and no law requiring such appraisals involve physical entrance to the home rather than 'windshield appraisals'." He further stated that a request had been made of the City Attorney's office to address the law requiring free project appraisals and, more specifically, the requirement of an appraiser entering the property. City Administrator Hedges distributed a memorandum the City received from the City Attorney's office stating that professional standards do require that the appraiser enter the home in order to conduct a proper benefrt appraisal. City Councilmember Blomquist stated that residents have provided information that the appraiser has been inconsistent with his representation on why an appraisal is being conducted and further, the appraisal is a very brief inspection of the home interior. City Council member Blomquist further stated that she is hearing criticism on the appraiser that is being used by the City Attorney's office. Mayor Egan stated that he is supportive of the methodology for the appraisals as long as the City continues to special assess street reconstruction projects. City Council member Awada addressed the question regarding the difference in street construction as to whether it is a capital project or repair, further stating that, according to the City Attorney at the January 20 regular City Council meeting, there is no difference. She further stated that for purposes of determining the cost benefrt to the property owner, the same policy applies whether the street is being reconstructed or a new street is proposed; the special assessment policy applies equally. City Council member Blomquist elaborated on her concerns regarding information that is necessary for decision-making, again stating that it would be beneficial for her to see an appraisal before formal action is taken on a street reconstruction project. Mayor Egan stated that once the appraisal is released from the City Attorney's office to a member of the City Council, it is no longer attorney work product. It is important to trust the information that is provided by the City Attorney's office. City Council member Awada stated that the City Council has already reviewed the total budget and funding for street reconstruction, making reference to the additional allocation that was made to the street reconstruction fund for 1998. There was no further discussion by the City Council regarding the funding or budget for street reconstruction. After further discussion, City Councilmembers expressed their support for the street construction policies as they exist. City Council member Awada stated that if a resident has a problem with any part ofthe policy, it should be presented to the City Council. City Council member Blomquist stated that she is confident that residents will be presenting concerns about the street construction policies and further commented on the embarrassment of the Country Home Heights project, whereby the City Council voted three different ways with no conclusion. She stated that, in her opinion, it gave the appearance that there is a problem with the street construction policies. City Council member Masin stated that, in her opinion, the City has received positive comments about the street reconstruction projects that have been approved and constructed during the 1990's. She further stated that once all street reconstruction projects are completed, she would like the City Council to consider bituminous overlays and other ongoing reconstruction/maintenance to be funded by the general property tax City-wide. City Councilmember Blomquist stated that she would agree that this type of program would be more fair to the community. 00034 Page 41Eagan Special City Council Meeting Minutes January 27, 1998 ADJOURNMENT Mayor Egan asked if there was any additional business. There being no further business, the meeting was adjourned at 7:40 p.m. January 27, 1998 Date TLH