This transcript features the Lakeville City Council work session held on April 22nd, involving discussions on fire station studies, utility franchise fees, local contracting preferences, and city financial reports. [0:00] Mayor Luke Hellier: call to order the April 22nd Work session if you join me to moment silence the [0:19] Mayor Luke Hellier: pledge pledge allegiance to the flag of the United States of America and to the Republic for which it stands one nation under God indivisible with liy and justice for all all right move on to Citizens Congress see none uh we will now go into discussion items I'll turn over Chief Meer for fire station study update and discussion [0:48] Fire Chief Mike Meyer: thank you may Council number so the uh paket in your packet was the memo and such outlining uh the two options if you will uh D3 and D4 and just for reference D3 refers to the new station VI and B4 is uh station two so we kind of went through the pros and cons of looking at both options uh with that I guess I'd go through there and and if you got any questions or if you want me to highlight anything in particular uh the one thing that we did add was some the station mapping on there which gave you you images of uh the response areas so if you're looking at station two and that was colorcoded green obviously is closer shorter response and then as it went out to Red gave you that proximity of like a six minute response time and then we did the same if we were to move to the station five option of what that looks like obviously there's pros and cons from a response time M piece of that um only thing I couldn't figure out I know it's probably just me wouldn't figure out much difference so between the two maps so if you could just explain to me a little bit better what the differences between the two [2:05] Councilmember Michelle Volk: okay it could affect my opinion on this so [2:07] Fire Chief Mike Meyer: okay so the station two map which was think the first the second map that you had on there is where if we were to rebuild Station 2 at its current site at doden Flag Staff like couldn't zoom in close enough to kind of give you that detail that you're looking for so it just shows basically what what that will show is where Station 2 is located today uh it gives us that response time or that uh to reach the the Eastern side of our city border out to um [2:47] Councilmember Michelle Volk: yeah I understood what the maps meant but I couldn't figure out is like the green still is there and so I couldn't figure out really if there was a lot of difference [3:00] Fire Chief Mike Meyer: it's mainly affecting that eastern border of the city limits the Eastern side of branching Farms yep so the right side of your screen as you Northeastern corers um [3:38] Mayor Luke Hellier: so without objection we we'd have somebody come a hair wait for s's comments if you rever back and sure you want to just stand up give us your name and okay so [3:47] Citizen Don: Don us to saw him late I got confused in different directions been here I stopped maybe three four months ago on little concern on Water and Sewer issue that I had at my house and I hadn't really heard any feedback yet and kind of wanted to maybe see if I could blow the dust off of it again or at least get some type of a um whatever we can if there's any resolvement to it or anything and and stuff like that that's kind of what just wanted to see if I can blow the dust back off that file yeah I didn't bring any more copies along that's okay so and I'll just maybe explain a little bit um the past owners had a deal with the city that uh they were immune from City Water and Sewer until they sold the house um that was written by the city of lakeo and stuff like that and they didn't disclose that so I ended up I did get some money out of them but nowhere's near enough to cover that project and I I know one of the letters that you got back from your City attorney kind of says well tough you know but um I didn't make that agreement the city of Lakeville made that agreement and the owner of the property made that agreement the other thing is the city did send paperwork to the title company um showing some of the what do you assessments but they didn't show the whole file and if they would have just shared the whole file with the title company I would not be here today because that inside that file is the letter that the city had with the past owner and so I'm just trying to see if I can stove TI to rec cover it was pretty expensive project um just trying to see if I can recover some of that somehow I can work it out with the city I mean whether we do credits whatever I'm just I'm open to anything I just that's kind of where I'm here and stuff like that um [6:13] Mayor Luke Hellier: thanks for coming [6:14] Citizen Don: yeah I I I like Lakeville I hate to start off my first two years in Lakeville at this kind of project and stuff like that I'm very happy to be a member of the city lake so I'm I'm going to [6:30] Mayor Luke Hellier: so we'll follow up with you okay okay yeah I'm easy to work with I just need to see if we can do something I get it thank you do you need that M or do you want that yeah I I have all I think we have it all okay okay very good thank you for your time okay back to the fire station um I had a question you know we've talked a lot about location of five in like Dot and Cedar have we identified parcel parcel by chance I mean it's we have [7:13] City Administrator Justin Miller: I guess there's a few that we've looked at but we haven't okay so so there's some I mean because I know there's some expensive like multif family that's over there that's available but I'm just like Curious like what what's around yeah there's available land we've been hesitant to say anything publicly um about that but we think that there's some options there if the council goes that direction that we would start okay start reaching out to those Property Owners or Brokers [7:34] Mayor Luke Hellier: okay other questions or from Council [7:37] Councilmember Dan Wolter: yeah one more I think um so with the new the station five proposal do we have any ideas what we to recoup some um [8:06] City Administrator Justin Miller: well we have ideas okay um they both have their challenges two is probably the most say least or the two least marketable of the two um from reuse stand unless we try to find some creative residential on it um it's in kind of a neighborhood area residential area four has more options either in terms of selling it it could easily be turned into an office or maybe even a small office warehouse It's possibility could be a shortterm place for some of our storage needs as well um so there there's options but we haven't we didn't spend too much time doing that before we kind go [8:50] Councilmember Dan Wolter: but you consider them pretty viable options to be [9:02] City Administrator Justin Miller: I would think so I for the right price could probably property right but um well yeah of the two [9:14] Fire Chief Mike Meyer: I would say four is more marketable [9:18] Councilmember Dan Wolter: yeah that four would still be an operation until until 2029 [9:22] Mayor Luke Hellier: yeah I I um I've always been nervous about you know trying to get rid of station 4 and I like to see the I like the data 29 because I think by then construction we have a really good understanding about what that station's capabilities are certainly and we'll continue to see what kind of growth is happening so I I'm I like to see 2029 instead of you know whatever I don't even maybe that's what we had before too and I just wasn't paying attention five years seems like a decent amount of time to get a lot more information to figure out exactly what the right path is on all that [10:14] Fire Chief Mike Meyer: and I would say if you went with the the station two option that that one I think station four potentially become something that we keep longer as as you said that's something that we'd have to evaluate once we get closer to that Mark [10:19] Councilmember John Bermel: I mean I've always my sense has always been that cedar and DOD makes a ton of sense I would like to get your feedback and certainly people that have driven trucks through I mean the oval about there seems to me like investing because of the infrastructure of the road around Station 2 seems like a bad idea and maybe you guys have a reason around that but it's just that intersection is just I don't know I'm maybe it's not a problem but I as I look at it just seems so jammed in [10:48] Fire Chief Mike Meyer: that's obviously that's our concern to rebuild the station there is that footprint um but we also took and orientated the station so that you're exiting on the Flag Staff okay you know similar to what it is today but it's a little bit further to the would be the South um that would be the entrance exit for the station there is on the design that was attached in there that you can come in off of dot but that was more slated for the public entrance like you said we are right up against the round of is the concerns with that [11:28] Councilmember John Bermel: do we know how much the traffic's going to change once switched over to do we think that the traffic counts go down or will be less um [11:36] City Administrator Justin Miller: we have Progressive projections I would say it's going to go down from what it has been um try to design it that way I don't get the sense that traffic is probably the biggest issue there from the fire standpoint it's more access [11:57] Mayor Luke Hellier: yeah no because I mean it's stop I mean correct it's it's just the the amount of land to to rebuild on orientation of that is your sense from your team Mike um that the rebuild of two can get all I mean when we went on the tour seemed that two was very deficient I mean right but not having the clean all that stuff and so I'm I get all that do you feel that the way it's designed because to me I I this says we either have a 19 million or $26 million decision from right because the rest of the stuff I don't think we need to decide now and we'll learn as we kind of go I just I'm just I want to know from your you know vantage point is station rebuild station two as good as a five and are they Apple to Apples [12:42] Fire Chief Mike Meyer: if they're not then I'm willing to have the consideration of the bigger investment because if we could start completely fresh on a side I feel better about the the limitations of rebuilding too is five we includeed moving taking into account that for would close and admin would move into that so you have that bigger footprint to allow for the expansion of that for uh the meeting rooms you know secondary EOC and such like that with station two we don't have that so you just have the the basic station as you if you will the you know your your living space a small training room meeting room uh and then the base Bas and that was one thing that we actually discussed is that I think we designed it for six dorm rooms um we'd like to up that to eight just to which isn't a huge issue as far as just expanding a little bit but that's that's a limit the other thing we did or that we looked at with station five is if there's that partnership with Alina and they want to move their their base there uh we can do that with station 5 we can't do that with station two there's there's base Bas for an ambulance but nothing beyond that that makes sense uh the biggest hurdle that we would have to accomplish if we rebuild Station 2 is the operations of the station is rather than having conversations with the Architects rather than trying to phase in you know leave the one Bay existing at station two and for them to build around it I think it's simpler for us just to shut it down let them start building and then when they get a point we can at least get an engine back into the station get Cruis there we just have to make do with during that time if that makes sense [14:40] Mayor Luke Hellier: curious to get other feedback one of the other things I've been thinking about is if we do go through this plan we talked about last year about annexing a 1200 acres in the industrial park it seems to me that cedar and do station probably serves the industrial park better than I guess station one but I'm just thinking about like big industrial situations if we're adding that many more buildings and [15:02] Fire Chief Mike Meyer: the one would still remain the primary for industrial park just because of proximity yeah if there's something bigger occurring in the industrial park it it's not just one station it's multiple stations that are going there right [15:15] Councilmember Joshua Lee: okay I guess my only other thought is is that we've never had this discussion it's just kind of something in the future and um I know Burns will has their own ambulance Etc or whatever if we were to build a new station we'd be a little bit more forward looking and thinking about do we ever want to go that direction and we'd have a better option because none of these stations would be able to May four maybe four but one but I think you could expand one one enough to add g b at one [15:58] Fire Chief Mike Meyer: well every every design we accommodate enough base space at least for one ambulance in the station regardless if it's the might three or something I [16:04] Councilmember Joshua Lee: I'm just in case we ever decide to um make it our more our own yep that type of thing y I guess that's the only other thing that it would give us more flexibility for making some for us our future councils to be able to make some better long-term solutions for the community for as far as safety goes um that's just my thought [16:35] Councilmember Michelle Volk: what was the number of Acres [16:38] Fire Chief Mike Meyer: station little over four is what they say four [16:42] Councilmember Michelle Volk: and the other thing that I think about too when you're think like more long term you seem to be running into some landowner issues on these City I don't think we're going to expand as quickly kind of Department in Border there's one big project River Meadows plus that neighbor's going to do a project so there's going to be some growth on the west side that we weren't thinking about so I just know I'm trying to figure out I mean I I those will probably sered by four I guess three or one this side like Walmart area [17:23] Fire Chief Mike Meyer: three actually because of their proximity to the freeway is is actually a faster response to Walmart area [17:53] Councilmember Dan Wolter: I keep coming back to think we have the facilities in the land that serve our community well the four stations we have I think can be repurposed to three and potentially have a l of space at four in the future if we ever to get that as an option I think for me it's a matter because I I think the question of that is a little maybe unfair fair to ask would a station five be as good as a station two because think clearly no starting from scratch on a larger piece of land on bigger intersections are that's obviously going to be the best spot but from a Roi standpoint moving half a mile away is it is it worth the $10 million for the options we're adding at C and do that we're not getting at flag and do and can those features take place elsewhere um it need be so that's kind of where I'm I'm really hesitant to talk about1 million more for half mile away so I don't know that kind of to your point about these two maps look the same they really are it's just that green Target moved up a half a mile um so [18:57] Councilmember Joshua Lee: so I tried to take the sticker price out of this whole solution I know that sounds really strange for me which is really unusual but what I was trying to look at is not the CER price but the longterm solutions for the community and which even though one is half a mile away from another but which one is more beneficial and for me per I know it's crazy but for me um it was to build station five and to try to figure out what to do with um two and four to recoup some of that but to be able to plan half of our problem is is that we've got old stations that aren't anywhere near future and they're limited to get us to the Future because they're only going to get us so far into the future and not be able to keep going type of thing and so and if two even though it's a half mile way had a better footprint you know that it could handle much more and it really can't and it's just in the wrong it's in the wrong spot type of um especially with the the residential right there I mean so I guess I that's why I was trying to take out the sticker price to just try to look at what the overall picture could be if we were going to make this investment what would be the best way from like a business point of view of trying to figure out your future options and where the business could take you but just to yes the the cost is important but also not terms of figuring out what's best for the community [21:11] Fire Chief Mike Meyer: but I I think the points about our payon column and how that impacts the the radius and recruitment there [21:18] Councilmember Michelle Volk: I think station two is one of our leing calling call out stations isn't it [21:26] Fire Chief Mike Meyer: second both one and two are they're call it as far as their call how much calls they they responded I so it would make it one and five if if there was a five [21:44] Councilmember John Bermel: what would be missing out of station two if you rebuilt that location [21:52] Fire Chief Mike Meyer: but we talked as far as um two wouldn't have any admin so we would remain station for Remain the admin station as far as where all the inspectors must our H so that would be when you talk longterm if you do station two will have to address that at some point whether it's station three or uh I know the Architects kind of cringe when I asked them the question of you know remodeling one and then adding admin to that because we're Remodeling and then we're literally taking going further towards the east of that expanding the building longero there still three correct three has the footprint to accommodate that but it wasn't part of our study when we looked at that so so you're kind of trading off if you do station two we're going to have to do something administratively as far as at some point too that's [22:50] Councilmember John Bermel: and that's one of the things I was considering as I read this it's like and now your admins in station 4 you know you have a plan that eliminate station 4 you have to have that admin go and it needs space plus if you desire to make a lineup that's a whole base relign they need admin space you know so so it's you have two sets of admin uh that are going to be in a space I think from that perspective a station five gives you the most flexibility to to build it in um the other piece is what what occurs to me is as we started looking at the eils of these player stations and it just became very apparent that from an environmental standpoint none of them really you they all need some work and so I mean we're talking about whether you combine two and four or one but I think the other piece is every one of these is going to need to be touched in a pretty significant way not just to c a paint and make a room it's they're going to have to be touched in a pretty pretty significant way uh so then the third thing I was thinking about because this all started with response time right how can we improve our response time the fulltime is an option uh because you have more coverage during the day and so I looked at the response maps and I went Dar because I I was hoping that there would be like an obvious this is going to be the best way to improve response times as much throughout the city but they're pretty similar maps but I mean I would agree with the mayor on on the point that it's going to be important to have an understanding of what direction is most likely uh to to have growth both residential but also the industrial um and those types of things and the other thing that really struck me as I started thinking about from a practical standpoint is a station five would most likely be the one that's going to be first response to the industrial areas and I'm going okay we just approved a couple buildings that are higher than we've ever seen before uh because that's the way the technolog is allowing that so to look five six seven 10 years in advance and to try to understand the type of equipment we're going to need to effectively respond uh to a growing Industrial Area I think is important too and you can build around that I mean St station to we could build a fire station there probably be more vertical than anything else but you're not going to have admin space so you still have the question of what do we do for admin space and how does that look someday if if a line it does go yeah we want to be more Central being Lakeville or you know more where calls are or whatever and do we have the ability to do so those are the things I was thinking about it's an investment either way uh it's expensive either way but if you want to make a decision that will um really take the future into account and so for me the growth and how that response time looks for where we grow uh can we fulfill our contracts um because we have a contract with Township correct um and uh how does this look for setting up for for like future admin and future needs for fire for me I don't like it because I the uh cost is high but for me just from those perspectives doing a station five to me makes a [26:12] Mayor Luke Hellier: then when you're looking at growth I mean you you should assume that these stations whatever combination we pick are going to serve what our overall Master growth plan is it might be longer than we think but you know the dnut hole is going to fill in with residential yeah eventually right West Freeway will growing slower um and then the industrial park or anything south will grow as well but um you know I don't think you need to just don't imagine what it's going to be like in 5 years imagine what it's going to be like in 20 years because the station are going to be serving those that community [27:07] Councilmember John Bermel: so I mean the trend is other departments other cities are going in Cy model's already P you're a young new about coming out of you know fire school probably the fire station you're work in is going to be a key component if it's you know everything else is kind of similar in this area so I think long term what is going to entice new recruits come out work in Lakeville versus you know going to Prior Lake or you know going to Burnsville so I think we have to consider that which sounds like five would be solve that problem maybe [27:54] Fire Chief Mike Meyer: May and and I think we touch on it the retreat is it is part of a recruitment retention tool as the the amenities or want to say that is what they're the space they're living in right yeah I mean I think I mean we all I think we all toured Burnsville I mean there's nice living quarters there and you know I if you're spending 24 straight hours there you probably want to feel pretty comfortable I would gu [28:13] Councilmember Dan Wolter: but aren't all options they include kind kind of similar bunk set up they've got the zone changes so that there's new safety elements that have right now [28:22] Fire Chief Mike Meyer: correct in terms of responding to a flight or being able to shed your your turnout here Y and then go to a clean environment so in terms of safety and all that both options have that they're all in the same design just scaled obviously maybe more vertical second Flor uh all of them even including the remodel that one included a second floor so moving that living space up so that if you do have public coming in that those those are kind of the off limits that's where uh that's where you're Fighters are going to stay during you know their their downtime so speak sure [29:01] Councilmember Michelle Volk: do either of these um have training to remember [29:03] Fire Chief Mike Meyer: yep so as you're looking at the know what you're at station five all of them have that Center Island in the red okay which is it doubles as a second floor training area and then the first floor is that that's where you're going to go to wash clean so none of your dirty gear dirty medical equipment is going towards any of the living um office space [29:38] Councilmember Michelle Volk: I missed it because it has apparatus first sorry that's and can you tell me the so just from a Layman's perspective I'm I'm also looking at the response time maps and yep the biggest difference to me is that we have really good response times in Apple Valley um with the Station 2 model um I mean what what am I missing anything here are they telling me anything or should they be telling me anything that I'm not not getting what what is is there anything hidden in there or they not very very much doing like [30:13] Fire Chief Mike Meyer: and I think I think they touched on it just shifting it just move so as you look towards the right side and if you move the station to DOD and Cedar you lose that Eastern side so you lose some in the right correct try to figure out where I'm at on at the road you can see you know like the dot or the cedar how they're green it's just because that's a major through fair that you can travel on that versus red typically is signifying like Lake Maran is red so we can't obviously respond through Lake Maran or a park but uh kind of the cedar Corridor where you see the couple zones of red it's just that's undeveloped there's no roadways there so it's not that we can't get there there's just nothing there for us but obviously when we go towards the right side of the map as you look at it it's just further out roadways you're getting towards that Eastern Edge [31:24] City Administrator Justin Miller: you should also remember these are response times from our stations it does not take into account the automatic Mutual Aid we have so there's a a nearby truck or and Apple Valley it might get to some of these red areas quier than burns up on the west side so in [31:51] Fire Chief Mike Meyer: both options um Station 4 is used as kind of our our temporary space for each the renovation so as you build out if we were to build out station two at existing spot um I think we talked about that those people in that apparatus maybe moved to the cmf temporarily or maybe even station four temporarily until that's done they shift back during that time too because of the administrative part of um station 4 and station two that d uh four option that's shown that if you rebuild station two to accommodate the administrative offices you immediately go on it and you rebuild station one and that's you move down station one to build your administrative offices there so station one down here would be a complete renovation so you wouldn't do aemp renovation here under the one scenario you would just go immediately into an expansion of station one to accommodate Administration and and then to also expand the services there that would make up for station 4 eventually going away so there's some moving parts that if you do redu station two we make up for it station one saying that right right [32:51] Councilmember Michelle Volk: how usable those for close I thought it was all tanks underneath there like we couldn't sell it like we would have to use it for another purpose right [32:59] Public Works Director Paul Oehme: it's all the water tanks are under the grass area between Lifetime and the water Tri so that's all D East how much how much land like someone's going to buy how much land is it a second have to check we have to cut it out because it's part of a bigger piece of that that ws around there couple acres probably so you're adding cost to St and that's in this estimate then for the options of D3 D2 yeah or whatever it was there okay [33:43] Councilmember Michelle Volk: so I hearing is though we went with the first option with a station five that would be the administrative Center but with the second option if could combine two and four station one station station 4 is five acres but there's some wetland in there too you're right that's Focus [34:21] Councilmember Dan Wolter: I guess I'm still kind of at a point where I'm not seeing a huge difference in options going forward to me D4 allows us to also mitigate how we fun this over time because the pieces are small D3 I'm envisioning this correctly you're going in on the the biggest chunk of of that cost really because you're building facility purchasing that land um so that's going to be a a big heavy LIF right off the bat whereas before has smaller chunks of remodeling over time I know over time a few million and there every Chun but I don't know to me in terms of trying to figure out how to fund it it becomes more manageable to again I'm only saying this because in my opinion at this point it seems like the differences are very minimal between what we're getting in D3 versus D4 but it's because it seems like the Align of piece is the only part that we're we're arguing is it can't be done at station two and we'd have to figure something else out if we don't have a station five [35:27] Councilmember John Bermel: I think the other concern I would have there would be period of time we're gonna have a council in the same position I there's not a lot of future options with the station two it's pretty constrained there and frankly I think part of the challenge we've got now is that we're in a very constrained so I I don't know I I think the the station 5 one is a little more thinking thinking for the future I think [36:12] Councilmember Dan Wolter: but this isde so unless there's data out there that's saying that that D4 can't serve us effectively at 90,000 people if if we can say that then that's a different story but [36:31] Mayor Luke Hellier: well I mean my my take is I think longterm I'm just I still think I mean I get like some of the stations have to be upgraded but if we do build a station maybe we don't have to do all the other Renovations later or 18 million you know whatever because we'll learn a little bit maybe that's true [36:49] Fire Chief Mike Meyer: so that’s part you're going to have to rebuild three again it's similar because of the the footprint that it resides in and then the FR tier building really hinders trying to just remodel that building because it becomes too many angles and so on so that's going to have to be rebuilt at some point and that would require us purchasing land to the east I believe it is to allow for that again if you do that then you can leave the current station three in operation build a new one and then move everything over and then turn and turn U that parcel line could be turned over sold whatever that would look like one is the only station that gives us the option for remodeling it due to its size and such [37:52] Councilmember Michelle Volk: Joshua you've made great points still towards station five you definitely have you know put a lot of thought more thought into my head than I had when I walked in the door here but you still don't for whatever reason seem to upset for what what I think that we're going to need so but thank you I appreciate it [38:22] Councilmember Joshua Lee: I think when you start I just looking at the future and I think in in my mind uh the station five makes the most sense uh simply because you get the ability to build something that's going to blast into the future much further very limited with uh station 2's footprint once again it could be done build one there um but you know the administrative space and the future we don't know the future BMS response right now and accounting for if a were to want to base out of here or if we end up who knows but that's uh you know I wantan to I want to set this up so the people that are here going to be here after we are um have a a few more options than going boy I wish I would have done this um so in my mind you can't predict the [39:24] Councilmember Michelle Volk: I agree with to Joshua and to me the whole price T of the whole thing is it's a lot of M um yeah I mean if you could bit in piece it more but I think there's also some level of flexibility in my mind the for the other stations that would get redone the first thing is is Let's Make Them liable and see where what it takes to uh to get them to the point where we're flying with environmental statutes and all of that that's concerning to me too [40:11] Councilmember Dan Wolter: do you know what the underl zoning is station two if we were go in five Direction try is it offial I'm [40:24] Community Development Director Tina Goodroad: sure could somebody buy it and keep in using office or what have you thought about putting a fire station next to K Trail um [40:48] Mayor Luke Hellier: sounds like and Michelle's right I mean I think you bring up good point it sounds like the direction of the consensus St wrong I would be there too I mean I we're talking about a hybrid fire department now right and at some point we may go to a fulltime before we you know those housing laws pass and we have 200,000 people um that's a real so I John I think I'm particular [41:24] City Administrator Justin Miller: okay so next steps then [41:25] City Administrator Justin Miller: Next steps we'll start to um internally talk about some sites and start to reach out and make some do some feelers um so [41:33] Councilmember Michelle Volk: what happens if we can acquire St or look at [41:41] City Administrator Justin Miller: yeah go there yet okay cons um yeah and then we'll come back to you status point and we'll probably then I mean the the site dictates the design a little bit but at least we have some guidance that we can talk to cnh and stret to them know that we're looking at a a new station in that regard so okay conversation about this [42:12] Mayor Luke Hellier: you anything else [42:13] Fire Chief Mike Meyer: I just whichever way we go every station was designed for again that ambulance at EMS whether it's a or we're doing it ourselves we we accounted for that in long-term future each of these stations okay so that was something that we were looking at longterm you know 20 40 50 years down the road thank you guys appreciate it thanks for the direction on that [42:35] Mayor Luke Hellier: all right we are gonna move how to pay for it yeah so that was a fun part um so fr feed you want to stick with this yeah sorry [43:04] Assistant City Administrator Allyn Kuennen: all right good evening Mayors and council members um at the February work session we brought this um to you all um so I'll give kind of the same presentation a little bit faster and then I'll slow down once we get into the numbers and instructor stall can help me with that a little bit too um let see here um so just again this here is a map of the gas and electric providers in leville um kind shows how it's divided up within the city for the purposes of this presentation and and all the information in your packet we're looking at a flat flat Fe structure there are some cities in the Metro that do um a tiered approach um but uh we've talked about um that being a little bit more unpredictable um and difficult to um Implement um kind of some projections with that um this next slide here shows um some of our comparable Metro cities um and you can see their franchise fee rates um in yellow their electric franchise fees and then in blue their gas franchise fees so once they do it they implement it for both utilities and not just one of the um Apple Valley is the only exception they only have electric um that's the only one of our comparable cities that just has only one um these numbers here are new we've worked with um all four utility companies to get um more specific numbers on their um utility accounts so when you look over on the right side here the total annual revenues are um updated and accurate um based off of we took four different um franchise fee rates the first row there shows a $2 for residential for electric and gas um and then so on $462 um but again on the right side um far right column you can see um the total annual revenues based off of those dollar amounts and those are monthly right yes so it' be quarter the city is paid quarterly from the utility company but the bill is monthly got it good any questions on that [45:34] Councilmember Michelle Volk: well it's like a gas bill people people pay in a variety of ways some people know I just want to pay it you know longer or shorter monthly the budget I I'm assuming that this would just fall in line kind with an average or budget if if somebody pays monthly versus one that's going to budget pay the same thing every month even use it as much so it's based on what they pay for that money [46:04] Assistant City Administrator Allyn Kuennen: we no we just put it correct yeah um so if looking at this kind of compared to February work session I would look at those farri numbers and um kind of think about where you want to land in most franchise kind of agreements they're they have like a sunset like 10 is it 10 years 10 or 20 you decide yeah how I think well [46:33] City Administrator Justin Miller: just might know what is there a law how long they can be I don't know if there's a limitation but generally I think cities tend to go longer unless there's a desire to sort of renegotiate at some point but they are long-term contracts [46:50] Councilmember Michelle Volk: just screens from Northland just in case anything are they grandfathered in if the legisl changes something grandfather are we grandfathered in if we had done it [47:04] City Administrator Justin Miller: I want just add another Fran Fe this year so the legisl almost added a Broadband one this year so no I don't think they're gonna be oh I'm just we never well political things change all the time so depends on howed [47:20] Councilmember John Bermel: did you Happ to notice any relationship with the increases for residential versus commercial versus industrial because the numbers that numbers seem a little arbitrary to me as so why you would charge presidential $4 versus 14 for a small business I'm trying to understand who fits in each of those categories to help me understand what's an appropriate number for each of those columns not considering residential [47:58] Assistant City Administrator Allyn Kuennen: when you look at the other um categories they're they're based off of usage a little bit um and Julie correct me if I'm wrong but um let me scroll up here to right here so all commercial um entities fall into one of these categories um and so most of the time they're based off of usage um that's why that's how they're structured in a way the number can be arbitrary um but ultimately it's it kind of comes down to usage with some of those larger users [48:38] Councilmember John Bermel: is there a threshold for non-demand franchise fee or but because I'm trying to a demand Fran a demand small commercial versus a non-demand small commercial we know what the delor that would be like if you're an electric facility like a Data Center and you're using 247 electricity you're going to be demand for part of it and non demand for the other because you get a cheaper rate overnight if you have a lot of commercial using overnight electricity it's just cheaper because there's just less usage so it's it's how the utilities charge [49:15] Councilmember John Bermel: so it's something though that the electric company is the one categorizing these [49:21] Finance Director Julie Stahl: yes yes we're through this don't create our own categories [49:26] Councilmember Dan Wolter: no you can put any number in these right there doesn't have to be a Rhyme or Reason um should be but you could pick any number into those that you want [49:46] Councilmember John Bermel: well that's the other part of the conversation at some point is I I have a better idea what I think a residential unit should what number we should be considering for a resident like a single household not as clear on what that number should be for a commercial non-demand versus a commercial demand [50:06] Councilmember Dan Wolter: well yeah I mean in theory we could look and say okay um average homeowner is whatever kilowatts a month and then you can decide okay if if a if a a uses four times that then it should four you you could do that yeah [50:23] Councilmember John Bermel: so I guess that's kind of the metric that I'm trying to think about so if it's four times much maybe that's around the number we should be looking at for the franchise but on the flip side it could be 10 times a you right exactly [50:41] City Administrator Justin Miller: you could also just say if this is where you want to go here's the target we need to reach staff finance committee come back with the structure that meets that Target [50:57] Councilmember John Bermel: absolutely and that's definitely where I want to go with but I think I'm just trying to put my thoughts out there about you know trying to make this Fair uh conversation plus that you want to be able to explain it in an email or a phone call if it's somebody in the commercial end of it were to say where do I lie and [51:11] Finance Director Julie Stahl: how come if you look at the grid of the other cities there's no Rhyme or Reason I mean you'll see cities with a lower residential that then charge their commercials higher and I mean if you're looking at berland Park compared to Burnsville for instance um you know just the residential and then the small demand small commercial are almost the same yet Burnsville is $4 for residential and $12 for the small commercial so and just trying to look at the way the different cities have structured them they're they're all different it doesn't seem to be consistent algorithm G be a question too that we can ask them you know how did you arrive at your numbers is trying to get to that end number like Justin said yeah yeah [52:15] Mayor Luke Hellier: I mean um I'm okay with the approach of Staff kind of figure out today in my mind at least today we've got three big things we need to figure out a pay for it's the fire stuff it's what happens with public safety training for Center whether we continue to get B State money or not so until that is decided I think it has to be out of list and then obviously ongoing Street mainten we talked about figuring out what that right target number is then I think gives us our staff to figure out exactly [53:02] Assistant City Administrator Allyn Kuennen: and sorry I have more comments but I I know there's more slides so so I'll go on to the next one here which May are you kind of s seg to so here are a couple big Financial targets that the city has um just some things to to look at payment management Public Safety fire station um and so on um you can see the breakdown by fiscal year as well as the um total on the very right side this one more here too so um um this one's construction timeline for the public safety train facility as well as the fire station remodels are um new bels and [53:49] City Administrator Justin Miller: that fire station when that first year might be a little aggressive I mean we haven't acquired land yet we haven't design so I mean that's as fast as it could happen right [54:02] Assistant City Administrator Allyn Kuennen: so with that staff seeks Direction on um if Council wants to move um in the direction of implementing franchise fees um if so what um maybe R amount or some general direction on that and then what um would be the funding Target should go back up to the more that one and [54:21] Finance Director Julie Stahl: real quick I think I was we talked about this these numbers s not this one the one above that showed how much um would be generated by each amount that did not incorporate any growth in residential units so that would go up just organically with grow and housing unit [54:39] Councilmember Dan Wolter: I guess the other thing I was trying to make sense is if we are deciding to pay for payment management that is supporting operating ly and it's not tied to debt um and in terms of our supporting the other uh most of the other ones are I guess the the vehicle and building maintenance funds are property yeah so there's I think there could be two ways of thought around this too about how are we are we supporting decreasing our operating Levy or we trying to pay for our um bonding and I think either of those questions I I would assume have an impact on our our Moody's rating I don't know exactly how that all plays out but if we're dedicating it towards operating Levy is I'm guessing that's helpful but also if we're we're paying for the bonding we're taking on knowing that our income is also helpful so maybe it's just six of one half dozen of the other is there a better route to go in terms of just financially supporting one or the other so [55:58] City Administrator Justin Miller: doesn't if we were to um okay maybe I'm wrong here but if we were to just be looking at the facility in the building that would have debt and these numbers would go towards the debt so that's what still help the taxpayers right because we're not adding to the property taxes to pay for higher debt so so I think with your question all five of the things that are listed there they all offset the tax fa one way or the other on the property taxes because it's coming at them in a different way so is that a moot question I does it I don't know that it's a moot question I just think that um no I mean just remember bar correct me um just when we bond for these you're still pledging your go you're still pledging your general obligation then behind the scenes each year the council makes a decision to how to pay for that Debt Service um so we can tell them that we plan on using franchise fees we canop policy we can do whatever but there still is that go if all goes Haywire city taxes will support it so this is and that's in reading the memo I got the impression that we bond that we pay for the bonds this is separate so we make a bonding decision based on need based on what we want to do this is like an extra that oh hey you know you could do a franchise p and have some extra money however we chose to do it [58:04] Councilmember John Bermel: from my perspective I I and you don't have to say 100% I mean say you know G aim to pay for half of the de service or something like that yeah because we get paid we would get the receive these fees quarterly and uh when do those payments happen twice a year yeah all of our debt issuance is twice a year principal in February and the interest payments every so we'd have a pretty good idea of what we're GNA be um I think for me I a few thoughts on these I mean on first blush I just I don't necessarily like the idea but um I think this is a way uh to fund I think it's it's a way that we can share in the expense of some of these services that are used by the entire Community um especially for me my eye is drawn to the public safety training facility and the fire station rebuilds and I think it's a way uh to have the entire Community uh supporting uh those those things um for me those would be the most applicable uses for a franchise fee um and I I think I definitely would want to put some kind of end date to it that would coincide with with how we're how we're paying for these um you know I for the public this is new for us and I I think you know to Michelle's point we'll be answering some emails and answering some phone calls but I think it would be incumbent on us to just educate the public as watch as if once if we decide to go down this road I to educate the public as much as possible about what we intend to fund with it why we we want to do this because I I think people are going want to know um so I think I can support it to fund um some specific projects uh that are going to have a really heavy impact on bonding and our living uh for me the reality of the next several years is we're still a growing Community we're still a fast growing Community but we're not growing as fast as we used to be and as that growth slows the infrastructure isn't right in space with it so we're going to be making a lot of infrastructure decisions over the next few years or whatever counil it is over the next few years is going to be making a lot of those decisions um some of these things it' be nice to be wrestling with one would be nice to have versus need to have I think the things I'm talking about so I could support it to help fund um some projects that are going to have a pretty big impact and I would want to do that for specific time really educate the community this is [1:01:40] Councilmember Joshua Lee: well in that sense the easiest talking points are those two projects and they do have a Sunset date for paying for them and think both of those items are maybe not uh very common for other cities to actually have an idea of when the franchise fee will go away but that I think is our goal for this particular implementation is that these dollars will pay for these items and this is the date that we in for that franchise to the Sunset [1:02:10] Assistant City Administrator Allyn Kuennen: and do they um but maybe we discussed this ear does it have to have a sunset I mean do do other cities just have it into perpetuity you know I don't know you have to you don't have to have a sunset on it and franchise fees are typically between so our current ones are going to be up at least with the gas are going to be up here in the next couple years anyway um the franchise agreement frenchise agree with themselves [1:02:29] Mayor Luke Hellier: I just want to Echo what John I think of it's Project Specific and sunset I think it's a it's a good idea I I do like the um that it broadens the tax base um I mean every everybody with an electric bill is going to be paying something so it's a little dynamic change for multif family um housing as well that um and I don't know if we've heard a lot from the nonprofit profit Community but I think that's um you know it's going to impact them as well so it sounds like there's consensus around focusing on the two projects so we're talking about Target we're talking between four and five million a year is what are numbers right [1:03:09] Councilmember Joshua Lee: can I ask another like logistical questions about this so is it only government units that can employ a franchise feed could is there anyone else that could employ a franchise fee with utilities [1:03:22] Assistant City Administrator Allyn Kuennen: only municipalities can um and it's basis of it the statute reads that you you're allowing these um chili companies to use the right of way um and that's why the cities have the right to assess these fees [1:03:44] City Administrator Justin Miller: but even though our service for these um projects is beyond our borders we're only able to count the L Within leville so Eureka Township utility that's why they contct okay so again thinking between that four and5 million yearly revenue is always thinking I mean staff and others try to figure out how we get there with you know I think I don't think anybody is looking at a number on the residential higher than $6 a month [1:04:47] Mayor Luke Hellier: Sor to use that as kind of a basis because that would be the five million right I would like to example scenario in each of those so for an average resident user how is that $6 impacting that bill [1:05:04] Assistant City Administrator Allyn Kuennen: I got someone from Dakota Electric was here at our last work session and off the cuff said something like you know $6 would be 7% of an increase on the bill he said you know that's off the cuff so don't don't quote me so I think it' be helpful to have some actual sure we can pull that be 10% yeah well I know it's going to different for everyone no I know but I'm just saying when he came up with seven I'm not a very big user of anything so about three and a half [1:05:40] Mayor Luke Hellier: does that make sense keep working and we'll come back to you probably summertime sometime okay thank you [1:06:04] Councilmember Dan Wolter: can I just I think um made the point about kind of a PR yeah because I mean we are getting as you know we've gotten questions the chumber group and and a variety of things I do think it's one of those things that's going to be important socialized in terms of so people aren't surprised I I mean I've gotten some feedback just kind from the types that from the perspective of we don't want to this is growing government you know kind of the typical anti- fee arguments I do think that making that case in a very concerted way is going to be important and so maybe that's something we need to start doing next what would our timeline be for for this again well I think we would hope to try to get it done this year to implement January one so we've got some time here I just I don't want I I just yeah people are really surprised by it because there's some well-informed people paying attention um but but most probably aren't [1:07:02] City Administrator Justin Miller: so if that was the message wouldn't the franchise be Co coincide with how long we have to pay the on you certainly can the problem might be though is we're going to be issuing debt different times with fire stations it's not We're Not Gonna issue right so do you do it for 20 years from when we issue the last debt I mean I guess I would like to see it end if if the last debt ended in 15 years then we'd go 15 years you know that's the way I'd like to see it CL makes a cleaner mess problem be is I'm still not convinced that we need to do as much in the fire station so I don't know if we're going to have if we're going to be adding it in 29 or not you know what I mean so is 20 years from 2029 because we're you can always because we're not gonna let 60 million next year you can always resend it it's not like once you that was my question how how do you change but I but to Allan's point you know when we sign these agreements with the entity at 20e term typically right so I would just lineing up with the term with I didn't hear that part okay with Dakota electri and Exel gas or whatever it's not my first pleasure J you remember when you put together these like on the fire station Deb service was that were those 20 year tally 20 years anything else on the [1:07:54] Councilmember Michelle Volk: one quick question so like when the mayor mentioned hey you know maybe we'll get into the fire station thing and realize we don't need as much debt um is that's something where I'm trying to figure out how you I mean so we get these payments quarter we pay our debt off twice a year but if we had less debt and we have more franchise fee money um I mean we that would allow us to probably cover a debt faster right and you could just resend the contract so good [1:09:02] City Administrator Justin Miller: or then the other option is the pavement management piece that we're currently levying for you know that's the operating portion of the streets you know F it's meeting the needs of the whole city so it's the mill and overlays the striping that that of all the streets you could always use the pay the franchise fee to then reduce the operating Lobby and then that would be you can always use it for anything else I guess I guess that's what I asking you can use the lower property tax that's yeah that's I guess just shiting money right yeah I would consider like when we have alls okay thank you thank you um [1:09:52] Mayor Luke Hellier: local preference and Contracting I'll turn that over to Allan this is something that I brought up at the retreat in January [1:10:04] Assistant City Administrator Allyn Kuennen: thank you mayor it's attached to the memo is just a memo from uh Campell Canon that Andrea put together really outlines our options when it comes to Contracting the first part she to discuss is you know if anything that needs to be bid really um um you're not allowed to use the the perp Contracting you have toid it anything above 175,000 needs to be bid and let it needs to go to the lowest responsible bidder disregarding if they're vcal or not um the second half is if it doesn't need to be bid um the city does have an option to look at um having a local preference um and has been challenged um on constitutional grounds but you see on the next page those challenges have not been successful um so she goes into federal grants and of course on federal grants there is no allowance for local purpos and Contracting and then she goes into the uh pros and cons of the city wishes to move forward with coming up with an ordinance for local preferences you know the the pros are it's it'll assist the local economy it's improve and protect the local economy as well keeps tax dollars spent on the contracts within the Community however the the cons are it may increase the cost of projects for local taxpayers and limits the competition among suppliers reduce the incentive for local businesses to provide the best value they may limit the pool of suppliers potentially burdens the procurement Andra process which is a concern that staff has mostly um invites reciprocal policies being enacted in other jurisdictions so if we do it Farmington out Valley brunville we want to do the same thing and then becomes competitive thing among cities and then are also um subsidized to certain businesses with tax dollars um so uh the challenges for implementing local preferences policy the biggest thing is defining what what is local who is local what does that mean um cities need to determine a defensible and a fair process um for determining the definition of what a local business is another challenge is defining the preference of how how will local supplier preferred through their hiring practices purchasing preferences or a contract award uh contract awarded preference so in conclusion the city has the option of doing this for non bidding projects but it has some challenges and some real drawbacks um in influencing thank you [1:12:47] Mayor Luke Hellier: I I one of the reasons I brought this up I may have shared this example the past I had couple conversations with business owners one was a diesel contract for instance they're locally here and you know they're bringing in training classes or spending money at hotels and restaurants then ended up losing out to a another entity that doesn't have brick and mortar it's a mobile shop by a few thousand my thought is if we've got some sort of percentage where if you're within a close proximity of a low bid on some this project that 175,000 you know in my mind i' like to go to the the local business instead of you know so that was why I brought this up I think there's advantages to um working locally certainly you know these smaller projects and I think it helps um local business owners too so that that was my thought process you know it's not my intent where we only everything on her 75,000 is going to go to a local entity but I if we can get one of a certain percentage them to say okay you the low bid is 10,000 but you're 12,000 maybe that's reasonable to do because to keep investment so that was my intention so if have a conversation [1:14:15] Councilmember Joshua Lee: I had a question because I guess going into before reading through the packet I was thinking of this as a the city may choose a local vendor in the case where you know it's more economically suitable to do so not a the city must do choose locally after looking at the contract options because as it stands now to me my understanding is that we pick the lowest one and that's most enough [1:14:48] City Administrator Justin Miller: yep most than best so what's best well you typically go by the lowest but if there's some outside parameters regarding like for example when we built the K elctric store there was was a concrete contractor that was the lowest um there is some financial and insurance backing that we were able to provide so we went with the next lowest after that so there's some parameters that you can take a look at for projects that are Bid that not just take the lowest but it's also the lowest of best the other difference is if you move forward with this da would recommend you only do it on what I'll call products and not services so I'll give an example I know we had we went up for RFP for a certain type of business um that didn't provide a tangible carpet or anything like that like in the but they did a service Engineers um other things like that um sometimes staff does not recommend going with the lowest spner on those for various reasons service experience things like that but we have had local people companies bid on those and we haven't picked them um that has caused some issues um but if let say you were to pick a threshold say 5% and they were within that 5% included services in this that would put us in a little bit harder position to to pick somebody else but I certainly would I [1:16:11] Mayor Luke Hellier: I think if i'd like Services included diesel contract that I don't consider that service okay all right [1:16:19] City Administrator Justin Miller: I’m consider I’m thinking you’re like Professional Service okay it's still a PR consult cons think Consultants got it okay [1:16:25] Mayor Luke Hellier: um but I mean I don't want to tie St hand I just want to know if if we're in the ballpark on some these projects but we're only ever picking the lowest one I'd like to give a little difference to look at so if we can create a policy I'd love to look at it that was that [1:16:47] Councilmember Michelle Volk: I've had a couple businesses also say that they're disappointed like people doesn't pick them you know type of thing they're trying to be as competitive as they can be too so you know we don't always have the cheapest rents for them you know the overhead Etc but um they are disappointed that they're not chosen as a are selected for whatever the needs are but you know we do I know that a way in a way you're using local Services because [1:17:33] Councilmember Dan Wolter: don't we usually have repairs done to our I mean physical repairs um like body shops that are in the area you know those types of things they do bid on them you know that you get us we solicit quotes yes solicit quot right such wording well because fitting has a different connotation okay so that's $175,000 right okay yes you do solicit quotes but you make it but you are going locally to solicit those quotes on a lot of and so I guess like and we don't have a policy for it that's what we do so I guess I'm just I like I don't want to have to change wording that we should May whatever [1:18:13] City Administrator Justin Miller: I would just like to see us get into the practice that we would solicit quotes well well or even the policy is if if the not just maybe give a little freedom to staff to make a decision that is not the lowest bidder we would need you to put that in policy yeah which is fine I want to put that in policy but I'm not trying to say you have to go with the lowest local bidder you know if there's somebody that's not that's 25,000 you know whatever you know giving some Liberty within a five I like what he said with 5% within a 5% lowest bid [1:19:02] Councilmember Dan Wolter: an option to choose local as a preference under the term best yeah can local be a preference under best I guess is that well the only thing is is that you're getting quotes on some of this let's just go with body work maybe you don't go to a certain business because you know instead of giving you priority and and uh getting your squad car back out in you know a week versus another one that you take it to it takes three weeks you know type of thing I mean you know do you know what I'm trying to say I don't want to limit the choices that staff has to make to be able to make sure they're getting the best service too anything I think because somebody can really low ball a quote and then that's right not necessarily think the goal of this is to expand that option not to so just like [1:19:57] City Administrator Justin Miller: Devil's Advocate let's say we do this and it's an option for a staff we don't pick the loc yeah you call I'm sure Andrea is going to make us say if it's with if we do this you have to be pretty consistent have that parameter well a 5% variance or something I don't know what that is but in the same ve you have three places in town that sell the same Widgets or produce the same widgets you're almost going to have to get into a place where you're you know shop a shop B shop C and and trying to their quotes are all within a few percent why didn't you pick me you know what I mean it's not always about dolls yeah I mean there's there's for example there's a there's a data installation company that's in Lake bille that we used in past had good service of them continue to use them the service went down and went down to a point where we won't use them because they're the service isn't there um so we go with a different company now it's similar cost but it's a different company it's not a Leal company so the Justin's Point how would you how to step explain that well yeah I'm just wondering i% now you're we having to pick them because they're within 5% and they're a local [1:21:42] Mayor Luke Hellier: no I don't say have I just can it be a a piece of the best you know when you're talking about the concrete contractor forance is is that you know can you put or is it just too complicated for [1:21:51] City Administrator Justin Miller: I don't think it's I think it's you'd be putting us in a tough position if we were to say a company was was within that 5% and we weren't going to be happy with we know we've had experience with them we know it something's wrong but we still didn't go with them even though they were within the policy that would be I think that put us in a pretty bad position but if we have a history of bad Services how is that because then we could rely just on a low price this is assuming contract [1:22:45] Councilmember Dan Wolter: concrete contractor a is from Lakeville and is not the lowest but within the 5% if we pick 5% and we still go with contractor B who's from out of the city [1:22:56] Councilmember John Bermel: I in my mind 5 is too too much to Wi I mean luk your example was say just a couple thousand dollars to me that sounds like a percent or two and if it's so close you know everything's equal except for gee they they all bid Us by $1,700 um know that you'd be able to look and go okay you know we can exercise this preference based on the best I yeah 5% so using $174,000 as an option just because Max is 175 yeah 5% that is $8,700 to me in my mind that's that's a significant I I would rather see that more in the 4,000 4,300 range which would be what four 2% 2% to me that would make a little more sense to say okay this was so close and we're gonna we're going to give a nod to the local business provided that we can somehow say that this is a better decision save enough I don't know [1:24:01] City Administrator Justin Miller: I'm in the theory that I'd rather not have a policy I'd rather just have it be a practice that we at least get quot from local as we're going out to but we can't that's my my point right now our policy just Lo right I that's it's different so the bidding different than justtin new carpet is off we have a purchasing policy that thresholds then we have to go to bid when we can get foral quotes andal if you start if you tell us to treat locals differently we need that in the policy [1:24:47] Councilmember Dan Wolter: I don't want to do that I guess I'm just I don't it's a little hard to the taxpayers and all that that were supposed to be going with them the lowest yeah I mean I'd support something that all things being equal the preference be given local best way it would have been is to be the lowest price all right Co well then you get complicated things that she addressed that in the memo um I live in Lakeville but my business is based in loka my local you know and I think there's a lot of L FES that people would have to sitp through um I mean I like the notion of giv local a um but I just it sounds very to me this is like I think any we did newspaper stuff there was a year we went you were we went P press because they were considerably cheaper some for a lot of reasons and and actually and P press it was it shorted kind of our time when it was right for sta you get publ daily right but it was a bad product a terrible product nobody can read it because it's all the table so we went back to the sun this week was few th000 more right four to 5,000 that's the kind of example talk we made that decision as a council that we vote every year but [1:26:21] Councilmember Michelle Volk: that example you're giving is also done by statute that the that the locals have to have so much access to that to be able to use um the service so that's not really a good example because of the statute um telling us yes we could go back to them but part of the problem about going back to them too was the fact that their subscription rate had um dropped considerably and the whole reason for Public Notices is make sure the Public Notices right so um so it would have to be a different example because that one has too many states that go that go along with it for when you're picking the the vendor um I guess my thought process is is that I really don't want to restrain staff I'd rather just encourage them you know but not restrain them that we have to pick local when local is not always going to be the best for the community you want to think so but everybody runs their business differently and some of them are not as well run as others [1:27:43] Councilmember John Bermel: when we when we go off for bid how how way and far is that like going over 175,000 depends on the project I mean we we do direct advice to companies that we're familiar with we advertise the newspaper we put on our website so we advertise in um professional journals um architectural and engineering and stuff like that so there's a specific website where you can throw bids out onto that contractors go and look at regularly depend on the project we cast it pretty wide projects there seems to be quite AIT discomfort forward on this I even though I think that a noble idea there's some Merit to it yeah I also have a feeling that our local part have a sense of on things or make that are competitive but I don't know no that's fine I appreciate the discussion [1:28:43] Mayor Luke Hellier: move on thank you uh um Deb issuance right you want Hammer through break okay thank you Council um have with us tonight Jessica from Northland and she'll go through their report um from them on this Bond sale that's coming out here we have um this was in our CIP be ISS this adapt follow for the um attorneys to be happy with and check off the boxes yes you did all your due diligence um and ordering the improvements and all that so um this is the last portion of the park referendum getting that um that's what we want to do is bond this last piece which is roughly 15 million of that $38 million Bond referendum so um it's our typical it's a street Construction project and then the collective Rehabilitation also is also in there for the street improvment portion so um those are 10e bonds and then the par Rec so um with that I'll let Jessica go through and if you have any questions to answer them [1:30:13] Jessica (Northland Securities): thank you mayor council good evening I don't have a lot to add based on what Julie just went through and obviously the staff report does a nice job of outlining what the city is considering with this issuance um but I'll hit some high Lev details and then of course happy to take any questions that the council has we have a current size of 22 M365 th000 for the 2024a series of bonds I'm going to focus um most of my comments on the executive summary that is found it's page two of your Finance plan um and again just talk through some of the the highle detailed process Etc so as Julie just outlined um we are looking at Bond proceeds to finance your street reconstruction projects for this year elct rehab uh projects and then this will be your fourth and final issuance um related to the per referendum Bond and we have structured this so it is while on excuse me under one bond issue so that you're not issuing separately anding um sort of multiple series of costs here um in terms of security the bonds will be considered General obligation so you'll be pledging Ador and property taxes to the payment of the bonds it's our understanding that you will have some assessments that will be assessed to benefiting properties those assessments won't be pledged directly to the payment of the fonds but will be used to reduce your debt service annually as those assessment revenues come in um repayment um so beginning February 1 in 2026 final maturity here is 2045 as Julie just mentioned the street reconstruction pores portions and The Collector Rehabilitation projects will be structured over 10 years with Park referendum projects structured over 20 we have a true interest cost estimated currently at 3.90 and you'll see the note below that um obviously that assumes that the AAA rating is affirmed um and we do have um rates plus 25 basis points included here for B the bonds will be eligible for um calling on February 1 of 2032 and at that time you can call in the 2033 maturities and any there after we will seek a rating of course for moodies um with this issuance and the bonds will be considered tax exempt and non being qualified there are of course risk factors involved with the issuance of any debt um that is included um in your plan if you do want to read through those we are looking at of course of public sale um receiving bids on behalf of the city and that would um occur Monday June 19th at 10:00 a.m. and then we come back before Council that evening for your consideration um and award of the bonds um so you'll see this one more time um so we are planning to bring this forward to council meeting um on May 9th and then again that Bond sale will occur June 17th unless something comes up and you let us know that you want to move things back but otherwise that is our current calendar and schedule of events [1:33:15] Councilmember Dan Wolter: but I really no this pandemic era B percent the sub one% those are the good days okay questions comments horrible I say it's not worse it's just too close it wasn't that many years ago yeah right he'll be saying that when he's 60 probably won't ever happen again other question we forward to see in the next meeting thanks everyone [1:33:54] Mayor Luke Hellier: and then um jul we have a sorry M yes mayor of the council a little later than we're used to with this but um this as fast as we could get it together we're still having journal entries last week it's like oh got to get in there so um we are looking at so I just go through just a couple of the Highlight items in in the report that you were given um total revenues being 335,000 higher than budget estimates um roughly 149,000 lower than 2022 um so that's mostly resulting in development being down um taxes are slightly lower the budget estimates and that basically that's just the uncollected um the tax revenues that people um and didn't pay their proper taxes so it's not a lot so 9% of uncollected taxes um the permit Revenue it is has decreased 350,000 um from the prior year again that's that development slowdown the chart that was shown um the historical building permits I think you can see that looks really ni or it's a good indicator of of course the low interest rates and the um wonderful timing of uh and all that um the the um costs of not having to pay those High interest rates and so development was peing in those years in 2020 and 2021 we are now seeing more of a steady growth like we did prior years so um intergovernmental revenues see the biggest change in 2022 um almost $3 million less than 2022 this year and that's because we have that lovely ARA money um 4.8 million in 2022 we did recognize um so our first Public Safety Aid that we got just at the end of December in 2023 we did put 1.85 million of that in the general fund the other3 million of it in the building um charges [1:36:15] Councilmember John Bermel: has that been we decided where that's all going to be spent I available for first center or we already have allocated [1:36:23] Finance Director Julie Stahl: we already have it allocated okay charges for services below amended budget estimat by 264,000 um we did have our Fiscal Agent fees from Dakota 911 and lake at total 258,000 and um those are the majority of the increase between budget and comparison a lot of that had to do with our EF implementation costing and sharing those with those entities um public works again with the engineering related Services connected connection with developer construction lower than the amended budget by 376,000 and down by almost U 34 of a million from prior year so um again seeing that that development Revenue just just a little bit tighter um parks Recreation um doing great art center came in a great they B less than budget but they're 120,000 higher than year so Joe's been doing a great job with that as I'm sure you're all aware investment income was another great positive we uh anticipated only 280,000 of investment Revenue but because of how the markets changed we were able to recognize 730,000 so that was a great that's a wonderful thing about the interestes count back um so when we're looking at the expenditures then um our total expenditures are about 2% less than the amend budget or 750,000 um our Personnel Services were lower than our budgeted by roughly 3% [1:38:22] Councilmember Dan Wolter: sure since we're at this point I had a question if you could explain this new budget transfer [1:38:32] Finance Director Julie Stahl: yes I just didn't quite understand what that and it is something that the Auditors told us when we met with them this past they said you can't continue to show these these transfers between these other Banks we need to show those costs if the water sewer funds show the costs in those funds communication show the cost in the communication fund and not have the transfers to from the general fund so you'll see like in the costs in our expenditures in general fund are down um by bu those allocations and the transfers in from those other funds are down so that they're offsetting each other is just how we have to show up in the financials um true transfers are going to still happen so we have for instance the technology transfer for 2024 budget will be a transfer out and then those those two those true transfers out um to other funds those are real dollars goinging into those other funds the equipment on the building fund but it's those like allocated costs it kind of services you know that the the water sewer fund realizes rather than doing a transfer from the water sewer fund for what our it people did for it we're going to show those it wages in water Su fund so it's just a matter of How It's presented in the financials from an HR standpoint [1:39:56] Councilmember Dan Wolter: is that going to make it more challenging to see where the work is happening [1:40:07] Finance Director Julie Stahl: actually not um some some cities will do uh it's over considered overhead you know so administrative overhead and they'll have a water SE transfer to cover all the overhead of administration and HR and finance Pro all those services that they do for the water sewer fund so is that like job costing it's kind of like that yes okay Y and it's that's probably a really good way to think of it um and Bas because we are not just service I mean Finance staff that work with we the work we do with liquor funds you know it's kind of like charging a person of our time that works with them and we're actually [1:40:48] Councilmember Dan Wolter: it actually makes it more because you're showing where that work Isen [1:40:54] Finance Director Julie Stahl: exactly and what the new Erp system it'll be really nice because we'll be able to see set percentages of you know certain Finance staff certain people will have 10% of their time will get automatically charged to their funds you know and it'll be set up like that right in the system so it's it's a different way of how we've been presented in the past you've always seen these budgeted transfers um in from other funds and so it's just going to be but what does a true cost mean you cut attch makes it true what does true cost me that's what you said the difference was the only transfer that would show up would be a true cost so the definition of a true cost is what a check a physical amount a physical it's it is actually moving money so um when we take money out of the general fund to set aside to okay it's a it's transferring out money from the General funds cash to the compensated lead fund cash okay or equipment fund or something like that and [1:41:42] City Administrator Justin Miller: I knew that question would have come with Julie and Julie W's like oh these are the Auditors just keep continuing to make their life I get it it makes sense to to report it well it makes sense I mean that's the way a construction business would do you know they would job costed this much of engineering went to this job and this much went to this job you know that's why I called it job costing that's the only simple key brain thing that I can think of but it doesn't change what it looks like on B because you have actual cost you know then it all get summarized y it would still show the whole FTE for inst we're not going to show the portion of an IT person in the water work on the FTS are still based on their base their home department for instance but actual cost allocation of their time thank you for asking that question I can talk to um so when we when we do look at the the expenditure side general fund of Personnel Services um we're lower than budget by 3% so roughly 640,000 um but compared to last year personel services are up 1.6 million and we knew that we growing and adding those positions um a lot of the variances that you're seeing um even like motor fuels we budgeted more but it still wasn't enough so they came in um higher than their budget by 91,000 just in motor fuels um uh most of the salary uh variances that you would see are doing positions either being vacant for a while or being filled and then we had payouts of um appr vacation time for those long 10e employees um we're looking at the fund balance and how we projected it with um back in we had projections back in the fall when we did December when we did the budget we had projected that our change in fund balance would be a minus 338,000 so the fact that we're coming in at a positive 741 th000 change in fund Mills is a great thing um and then when we're looking at the percentages of fund balance to the the the ratio that we want for the fund balance we had projected U the 40 I'm sorry 47% originally but we that our that our 2024 budget sorry our 23 fund balance would be 47% of the next year's budget it'll actually be 48.5% next year's budget way things have come down so it's all positive um see anything of the and when we're looking at the unrestricted fund mails right how we're going to look at when it's in the annual financial report we're going to be at 61% of our current Year's expenditures or the um so so there's there's two ways that it's looked at in the report it shows here's what your fund balance is of your current year expenditures but when we budget we show the council but this is what our fund balance is of the upcoming years expenditures so that's why there's that difference um we are also so then the other piece just showing again reminder the use of the fund balance we're actually doing a transfer out of the 215,000 in 2024 to the technology fund those other costs are you of the fund balance within the general fund so that's where we get to the 1.5 mil the council approved 2024 budget so with that is anybody have any questions with any of the items that we to report [1:46:16] Mayor Luke Hellier: no thank you good job it's nice to see that bit better financial position than we thought about that start our audit this is the first of our two audit weeks today so [1:46:31] Councilmember Michelle Volk: oh I guess the only thing I had I guess I could asked Mike about this now that we have um more hybrid are we going to be reevaluating um [1:46:42] Fire Chief Mike Meyer: we're in discussions already okay yeah we proposed a higher amount based on our budget um trying to raise it up even further um I have a meeting with their board chair and their clerk next week I believe and my spend meeting at them as well [1:47:01] Councilmember Michelle Volk: okay and then my other um this is on the same vein do you do we know in that area on 185th at credit Rivers developing they don't really have they assume that's Serv by fire lake or would they want agreement with us [1:47:18] City Administrator Justin Miller: no we they'll be entering to an agreement with us they're going to be coming to your may work session no but I mean for fire not not fire um that's a good question love to ask I mean the default will probably be Credit River but we'll probably get called for Mutual Aid yeah well because Credit River contracts in Fire Lake that's why I was wondering so probably that'll be where the call will go to initially okay plus it's in Scott County so [1:48:20] Mayor Luke Hellier: okay any other questions all right thank you um we will move on anything items for future discussion I had a question about what's on our doet for the session so [1:48:27] City Administrator Justin Miller: yeah Ed Port Authority that might get pushed to June compensation benefits um so we're um reviewing the insurance plan and done a salary study right now too so we're hopeful to bring some results of that back to the council um and then uh tradition is looking at developing some property just across the border in river that would require some a jpa with us staff has looked at it from from a utility standpoint so water andur staff's looked at it we think we can accommodate it they are going to Credit River Planning Commission or planning staff this week they just want to come sure okay with it um they just don't want to feel like they're representing Lakeville to their board I he so that's what's on there now I'm sure we'll have more [1:49:50] Assistant City Administrator Allyn Kuennen: was maybe The Pedestrian yeah we've had a couple things we just keeps pushing so that we have a light one we might bring that for any committee or city administrative updates I you canceled this month so I'm sorry real quick we'll also be having um P prog is going to come and give an update or a request I think they're asking for a little bit more street closures I think they want to get your input on that okay okay other we uh [1:50:00] Councilmember Dan Wolter: liquor commit if I'm missing something me in um we talked about just the uh sales are going fine um we talked about the uh some of the products that were selling uh some of the CBD products and stuff and those sales are are going well to and you're going to start to see if you're going into the liquor stores just see some uh uh pricing advertising and all that in there um we also talked about uh just taking a look at uh the Heritage Liquor Store and starting a study on just uh my understanding is is that store is is really over perform space so it's it's very successful so is it uh good is it a good idea to try something else another location keep it there what are we like right in the middle of five lease uh leas will be up in June of 20 okay so is a good time time yeah so it give us time to figure out Market study and then do something if we need to before and what is anything still ever have that part of the conversation it's all part of the conversation and they have phenomenal report on um theft and slippage numbers you're just yeah amazingly low [1:51:33] Councilmember John Bermel: I'm working in the retail sector percent or what do you call you slipping I was slipping so slipped and broke [1:51:47] Councilmember Joshua Lee: the legislature did come to conclusion that you know they're moving to this like Lottery model for cannabis but they are guante cities considering that now is that no I'm just saying it's out there it was kic so maybe that's where he think also um I just want to remark that April 30th which is this coming Tuesday is National therapy animal day oh and and you know I'll tell you what uh when I was in law enforcement we had Ranger who was one of the first if not the first in the State uh that was a therapy dog for sexual and domestic assault victims I really really really helped support a lot of people um where I work at the fountains I was on we had Peanut the facility dog and these animals are I mean they're amazing and they're well trained and you know they don't have opposable thumbs they don't have the ability to reason so they can't get to the places where they're going so it takes a human uh to get them there so I just really I think it's a good day to appreciate all the people that uh have gone through training and and dedicate volunteer and work hours for uh therapy animals especially because we don't realize the amount of hours it takes to train that dog to get oh yeah I mean it's huge and we just don't think about it is you know everyday citizens we just see train dog and not only that but just the ongoing maintenance I mean there there are some really strict requirements for So I think it's a good day to just remember all that and just encourage people if you are thinking about it uh try getting certified and and jumping into the freay there's certainly plenty of use these days therapy does that include horses yes yeah any animal yeah so the horse program and yep absolutely defin absolutely good bring it up um [1:54:31] Councilmember Joshua Lee: from a personnal standpoint you've seen what we recently met about but uh I would say the the highlight of that meeting was meeting Alysa kind of For the First Time one one so um just good to chance to newer staff members not any safety we haven't had Rec intend to open up the art center manager in June or you GNA do that now um I'll talk with Joe about what he wants to do uh Fire Relief um there the big talk right now is about P um last year was a very successful year raising about $117,000 um and the profits from that increased because the firefighters did all the the labor for it we used to have another pancake vender come in they have a special sauce um that everyone loved but we were able to irons too and the irons but uh thanks to a lot of different things purchase irons um so now there's more profit going back to really so trying to maximize that even more this year um in fact we're even a daycare center is being a sponsor this year believe it's high point is sponsoring the children's plates because those are always free for kids so I didn't really notice any kind of change in pancakes [1:56:03] Mayor Luke Hellier: Special Sauce ones to Firefighters did so what's funny though is the bigger conversation is if you're in the Tang camp or the non camp we argue whether cut T well first um thank you for everybody came to this city last week I thought I yeah you did a good job thank you building is awesome time I was you didn't sneak in during construction like no um so thanks for that I continue to like the partnership with the chamber you guys feel otherwise we need do our own but as well um on Friday's reported in the newspaper the housing stuff is basically done this year there will be no changes even the compromises is not going anywhere who knows in some of these last couple weeks some session if something get rolled into on this bill um this will come back and so we'll continue with Council and staff to figure out what our strategy is moving forward again I just don't believe we're outside and think were problem that is the uh extent of [1:57:42] Councilmember Michelle Volk: I just have one thing real quick I'm sorry um and it's just real simple there was an Arena's board meeting and the only thing really that um is significant is um that there will be an ice rate increase so um and that'll show up in the budget that gets um presented to us in June it's June so it's $10 an hour um and I mean we are at the top but we're not at the second but it's G to keep us you know even anyway [1:58:24] Public Works Director Paul Oehme: um just to update we did have a sewer backup downtown this weekend fortunately or unfortunately how you look at it the only damage was at the Art Center no other businesses were impacted um the cruise rout cleaning it and they found a blockage of grease and colored pipe cleaners so colored pulit who flushed a bunch of color us know but um little bit of damage we're still evaluating it um I mean it wasn't real high but it did touch obviously some carpon and wall so we'll have to doing there you Go's picture that looks like a typical Art Center yeah I know it we can't look beside look past our own but no the block not it was further down okay anyway all ceramic stuff those there's probably less stuff in that basement yeah there's less I mean I saw some pictures it it was mostly floor Carpeting and a little bit of shrock we'll have to see how it dries out so yeah we're gonna it's on any more details than you need to know but um that area is on a routine cleaning anyway and we'll be sending out a message to all of the Oba just to remind them management that then we we did get our feedback on have a meeting for the naming right for the out that I will take a motion toour second favor say I [2:00:17] Councilmember John Bermel: I the old days would been 8:30 so you know I serious thought of that during the last meeting that was a long meeting you know that would yeah I'm still trying to get used to getting