MINUTES REGULAR WASECA CITY COUNCIL MEETING TUESDAY, JANUARY 5, 2016 CALL TO ORDER/ROLL CALL

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1 MINUTES REGULAR WASECA CITY COUNCIL MEETING TUESDAY, JANUARY 5, 2016 CALL TO ORDER/ROLL CALL 1 The Regular Waseca City Council meeting was called to order by Mayor John Clemons at 7:00 p.m. Councilmembers present: Mayor John Clemons Fred Salsbury Ann Fitch Les Tlougan Allan Rose Mark Christiansen Daren Arndt Staff present: Danny Lenz, City Manager Mark DuChene, City Engineer Chris Elvebak, Community Development Director Shelly Kolling, Finance Director Gary Sandholm, Economic Development Coordinator MOMENT OF SILENCE/PLEDGE OF ALLEGIANCE 2 A moment of silence was observed. The Pledge of Allegiance to the Flag was recited. APPROVAL OF AGENDA 3 It was moved by Salsbury, seconded by Arndt, to approve the agenda as presented; the motion carried None VISITORS, REQUESTS AND COMMUNICATIONS Mayor Clemons asked if there was anyone in the audience, not on the agenda, who wished to address the Council at this time. There were no comments. PUBLIC HEARINGS 5a Adoption of Ordinance No Amending Chapter 154 of the City Code, Zoning and Shoreland Overlay District In January of 2014, the City of Waseca contracted Weber Community Planning to guide the series of amendments to Chapter 154, Zoning, of the City Code of Ordinances. The Planning Commission and City Council have completed the process of examining and rewriting many of the zoning ordinances. Staff has updated and included the Shoreland Overlay District, Sub-Section 8, per Council direction. Staff submitted the proposed changes to the Minnesota Department of Natural Resources and has incorporated their required changes.

2 Minutes Regular Waseca City Council meeting January 5, 2016 page 2 In addition, Sub-Section 18 - Enforcement, has not been included in these amendments as staff seeks to incorporate these changes with proposed revisions to the Nuisance Ordinances at a future date. The Planning Commission has reviewed the proposed changes and recommends adoption. Staff recommends the Council conduct the public hearing and adopt Ordinance Bill Weber, Weber Community Planning, addressed the Council and gave a recap of the 24- month process of overhauling the ordinance. He explained a committee was formed and after their changes were made, the Council met to review the draft ordinance line by line. Mr. Weber stated the result is a document which is easier to use and has been brought up to contemporary standards. Inconsistencies were eliminated but the committee did not eliminate or create any new districts, just made a lot of little changes. Mr. Weber stated this is a good ordinance and he recommends adoption. Councilmember Tlougan inquired whether the Shoreland ordinance is now current. Mr. Weber stated it is. Mayor Clemons explained to the audience that this ordinance was brought to the forefront because over the years there have been discrepancies and miscellaneous issues with fences, setbacks, etc. The Committee did the majority of work on this new ordinance, and he thanked Committee members Brad Wendland, Michel Sorensen, Robin Terrell, Paul Nelemans, Al Kingsley, Tracy Jevning and Councilmember Fred Salsbury. He stated their work is appreciated. Councilmember Salsbury agreed and stated the ordinance had been very clumsy and hard to read in the past. Mr. Weber did a lot of good work on it and people will find this document much easier to use. Councilmember Salsbury thanked Mr. Weber for his work on this ordinance. The public hearing opened and closed at 7:09 p.m. with no comments. It was moved by Salsbury, seconded by Rose, to adopt Ordinance No. 1040, AN ORDINANCE OF THE CITY OF WASECA, MINNESOTA, AMENDING CHAPTER 154 OF THE CITY CODE, ZONING AND SHORELAND OVERLAY DISTRICT; the motion carried 7-0. The City Manager commented the ordinance is currently available for viewing by the public on the City s website. ROUTINE BUSINESS 6a Council Mayor Pro Tem and Board/Commission appointments The City Council annually reviews their appointments to various boards and commissions for the coming year. Unless otherwise noted, one councilmember serves on each Board or Commission. Councilmembers can be re-appointed to their existing assignment or be assigned to a new board as the Council wishes. In addition, Council appoints a Mayor Pro Tem, who serves as the presiding officer of the Council in the event of the Mayor s absence or disability.

3 Minutes Regular Waseca City Council meeting January 5, 2016 page 3 There was some discussion and most Councilmembers agreed they would stay on the same board or commission as in Councilmember Arndt agreed to serve on the EDA to replace Mayor Clemons. It was moved by Christiansen, seconded by Arndt to approve appointments as follows: Mayor Pro Tem Allan Rose Airport Board Allan Rose Charter Commission Allan Rose EDA Ann Fitch, Daren Arndt Fire Relief Association John Clemons Heritage Preservation Commission Les Tlougan Human Rights Commission Ann Fitch Park Board Mark Christiansen Planning Commission Fred Salsbury The motion carried 7-0. It was moved by Arndt, seconded by Christiansen, to approve appointments to other nonadvisory boards as follows: Community Ed Advisory Board Ann Fitch Discover Waseca Tourism Board Ann Fitch, John Clemons Region 9 Daren Arndt The motion carried b Resolution No In Support of Increasing Local Government Aid in the 2016 Legislative Session Local Government Aid (LGA) to Cities was first enacted by the State Legislature in 1972, and continues to this day. At its most basic level it is a transfer of funds from the State to Cities based on their unmet need, and attempts to keep property taxes at a reasonable level. During this time the funding formula has been changed in various ways, with the current formula taking into account factors such as when housing was built, household size, population changes, jobs per capita, etc. LGA funding in 2002 was in excess of $564 million, its highest point, and was reduced to a low of $425 million in 2012 to help balance the State budget. Since 2012 additional funding has been provide to bolster LGA and changes have been made to the distribution formula to address inequities and to attempt to maintain its buying power when inflation and population growth are taken into account. The Coalition of Greater Minnesota Cities is asking its members, which the City of Waseca is one, to adopt resolutions supporting an increase of LGA funding by $45.5 million dollars for the 2017 distribution year. This increase would put the LGA level back to what it was in 2017 which, when taking inflation into account, is still significantly lower in actual dollars than it was at its peak. Staff would recommend that any additional funding received through LGA distribution would go towards infrastructure projects. The additional funding would help the City make significant progress towards reaching needed appropriates for long-term CIP projects.

4 Minutes Regular Waseca City Council meeting January 5, 2016 page 4 It was moved by Salsbury, seconded by Fitch, to adopt Resolution No , A RESOLUTION OF THE WASECA CITY COUNCIL IN SUPPORT OF INCREASING LOCAL GOVERNMENT AID IN THE 2016 LEGISLATIVE SESSION; the motion carried c Resolution No Ordering Feasibility Report for 2016 MSA Street Projects The streets recommended for improvements in the projects show surface distresses and failures in the asphalt. There are also new sidewalks and storm drainage improvements proposed. Proposed project financing is through property tax levy revenue, MSAS funds, utility enterprise funds and special assessments issued under Minnesota Statutes, Chapter 429, for local improvements. A portion of the total project cost will be assessed to property owners abutting the identified improvements. The engineering feasibility report is required under Chapter 429 prior to adopting a resolution ordering the improvements. A neighborhood meeting is proposed for this project to be held on Tuesday, January 12 from 4-6 pm for residents in the proposed project areas to have a chance to speak with the engineering staff in regards to site concerns they may have and to get an early explanation about the project process. These projects are funded through the Capital Improvement Fund which gets its funding from the property tax levy, MSAS funds, utility enterprise funds and special assessments. A portion of this project will be funded by special assessments to the benefiting properties. The proposed project is consistent with the pavement management policy for the City and is necessary to provide safe and reasonable transportation to the citizens of the City. Proposed financing follows the City of Waseca s Special Assessment Policy. Staff recommends the Waseca City Council Adopt Resolution No Authorizing City Staff to Prepare a Feasibility Report for the 2016 City Street, Sidewalk and Drainage Improvement Projects, City Projects # & The City Engineer read aloud the list of streets included in the street project in He added that letters were also sent to property owners for the sidewalk project. The meeting on January 12 th is for the street and the sidewalk projects. It was moved by Salsbury, seconded by Fitch, to adopt Resolution No , A RESOLUTION OF THE WASECA CITY COUNCIL ORDERING FEASIBILITY REPORT FOR MSA STREET PROJECTS; the motion carried d Resolution No Waive Tort Liability Limits The City of Waseca must annually determine if they wish to waive the statutory tort limits that an individual would be able to recover from the City in the event a single occurrence would result in an insurance claim that would exceed the $500,000 limit. This decision will define the limits that an individual will be able to recover in the event that the City is found negligent. It provides a greater level of flexibility in determining the amount of coverage when dealing with a citizen in the event of a catastrophic loss or personal injury situation.

5 Minutes Regular Waseca City Council meeting January 5, 2016 page 5 If the City does not waive the limits, an individual is limited to $500,000 from January 1, 2016 to December 31, 2016 on any claim in which injury is sustained and the City is found negligent. According to the League of Minnesota Cities, operating within the liability limits by Cities is commonplace. Given past practice at the City of Waseca, generally accepted norms and fiscally sound budget practices, staff supports maintaining coverage at the statutory limit of $500,000. The 2016 budget includes funding for insurance premiums. If the Council decides to waive the limits, the City would be required to purchase excess liability coverage which is costly. Staff recommends approval of Resolution To Not Waive the Statutory Municipal Tort Liability Limit for the City of Waseca. It was moved by Tlougan, seconded by Salsbury, to adopt Resolution No , A RESOLUTION OF THE WASECA CITY COUNCIL TO NOT WAIVE STATUTORY MUNICIPAL TORT LIABILITY LIMIT FOR THE CITY OF WASECA; the motion carried 7-0. UNFINISHED BUSINESS 7a Acquisition of property at th Avenue NE Resolution No Authorizing Acquisition of Property At a previous Council Meeting the City Council instructed staff to investigate the means of addressing blighted property located at th Ave NE. Conversations between City and County staff lead to an explanation of the procedure for acquisition of tax forfeited property for public use or purpose. The Waseca County Auditor-Treasurer received notice that the City desired to acquire the property for the public purpose of abating blight and potentially hazardous property conditions. The Waseca Board of Commissioners met to determine a fair market value of the property and have communicated their findings to the City Council. The Waseca County Board of Commissioners has determined a value of $100 plus all associated taxes and fees for the property (estimated at an additional $86). The County of Waseca has also offered to assist the City with an offer of 50% of the final required expenditures to demolish the structure and return the lot to a buildable condition. Bids have not yet been solicited for the demolition work, but staff suggests a rough estimate of $10,000. This estimate may be high as it has been determined that the structure does not rest on a foundation. If the property is sold, the County seeks to be reimbursed 50% of the final sale price. To date, the City Council has pursued the option of acquiring the property for the public purpose of addressing blight. The Council retains the ability to stop this process if it so chooses, and inform Waseca County to return the state property to public auction. The cost to acquire the property will be several hundred dollars, which can be paid out of the City General Fund with minimal impact. The costs to demolish the property will need to be identified at a later date, but will likely come from the Capital Improvement Fund. The Planning Commission has reviewed the proposed property acquisition and finds full consistency with the Comprehensive Plan for purposes of addressing blight. Staff recommends a motion to adopt Resolution to acquire real property located at th Avenue NE for the public purpose of addressing blight.

6 Minutes Regular Waseca City Council meeting January 5, 2016 page 6 Councilmember Arndt asked whether anyone had inquired about purchasing the property. The Community Development Director stated no one has approached him. The City Manager stated he has received two inquiries, however the parties are interested only after cleanup of the site. Councilmember Tlougan asked for verification that all expenses incurred will be included in the cost when we sell the property. The Community Development Director stated that is the case. Councilmember Rose referred to language regarding the County seeking to be reimbursed 50% of the sale price, and he wondered if this is still the case if the County doesn t put as much into the property as the City does. The City Manager stated when the County set a price, their motion was that they would split the cost of demolition 50/50 with the City. Councilmember Christiansen inquired as to the timeline. The Community Development Director explained the Department of Revenue has to process it, and he is unsure as to that timeline. After that, the selection of a contractor for demolition will not take long and we could have it cleared once the deed is signed within 2-3 weeks. The Community Development Director further stated the County Board discussed the sale price and understands what happens if we can t sell the property for what we put into it. The City Manager commented the County indicated a desire to see the property cleaned up rather than trying to recoup the costs. Councilmember Christiansen asked who would be the contact person if someone is interested in the property. The City Manager stated Gary Sandholm will be the contact person but if someone inquires or s the City we will get them to the right person. It was moved by Fitch, seconded by Rose, to adopt Resolution No , A RESOLUTION OF THE WASECA CITY COUNCIL AUTHORIZING ACQUISITION OF TAX FORFEITED PROPERTY FROM THE STATE OF MINNESOTA FOR PUBLIC PURPOSES; the motion carried 7-0. NEW BUSINESS 8a Market Place Property Pricing With the purchase of a new site for Walmart, other developers showed interest in the lots which were not needed by Walmart. As part of the purchase agreement with Walmart, restrictions were placed on the future uses of the remaining Market Place lots. In 2006, a developer was proposing a family restaurant, a movie theater, bank, a fast food restaurant, and other office/retail. In 2009, another developer worked with the City over a period of months negotiating a purchase. Neither of these projects came to fruition however. The latter project did have an offer of $750,000 on the table. At some point, Lots 1, 2, and 3 in Block 1 were platted to their current configurations. The layout appears to have been made for a specific project, but since that project has not materialized, the configuration makes the properties difficult to utilize well, especially Lot 2. Re-platting will be done when a sale price and site configuration have been agreed upon with a purchaser. There have been other inquiries as well, one recently, but no offers have been received. The site selection process today for both retail and industrial primarily begins with online searches for available properties. A key piece of information sought in these searches is the price of any property that is for sale. Site selectors work under very tight schedules which leave

7 Minutes Regular Waseca City Council meeting January 5, 2016 page 7 little time to ferret out missing information. As such, a property without a price listed usually receives no further consideration. Many City owned properties have not had prices set specifically but may have had different prices indicated for different uses. Setting market justified prices sets a consistent pricing. structure. Having said that, all prices are assumed to be negotiable. The City can accept an offer well below the asking price for a highly desired use. The EDA has reviewed the proposed pricing and recommends the Council approve the pricing as presented. Staff recommends a motion to price the lots in the Market Place subdivision as shown on the included map and to use the configuration illustrated as guidelines for marketing the properties. The Economic Development Coordinator explained when someone is looking for a property, they want to know a price, whether it is reasonable, and if there is no price listed they will go to another community. Pricing is reflective of a good market price and a good value for the purchaser. Those lots with greater visibility for Highway 13 are higher priced. Mayor Clemons commented previous councils have wanted to recoup the infrastructure costs, which were close to $1 million. There was also a desire to sell all the lots at once, but there were no takers, and we are better off selling the lots separately. Mayor Clemons stated the Council has discussed straightening the road and intersection in this area. This would cut into lot 3 a little bit and the estimated cost was about $180,000 - $200,000. He wondered if the Council is still on board with this, as Mayor Clemons stated he feels it is a driving hazard right now. Councilmember Christiansen asked the Economic Development Coordinator how he foresees access to the lots. The Economic Development Coordinator stated there would probably be individual curb cuts from 19 th Avenue coming in from the south. Councilmember Christiansen asked whether these are commercial prices, whether they are negotiable, and if the lots are shovel ready. The Economic Development Coordinator stated they are shovel ready and he used commercial properties as a reference for pricing. All prices are negotiable but having the lots priced in a reasonable range shows the City is a serious seller. In order to get some activity we want to have competitive prices. Councilmember Christiansen commented there is also an agreement with Wal-Mart. The Economic Development Coordinator stated the Wal-Mart agreement is more about retail competition, however the lots would be suitable for offices, etc. Councilmember Christiansen questioned whether development of these lots for residential purposes would address part of the housing study. The Economic Development Coordinator replied lot #1 may be good for multi-family housing. He added the lot lines are not cast in stone at this time and can be moved around. Councilmember Tlougan expressed concern regarding curb cuts along 19 th Avenue, as there is a lot of foot, bike and car traffic from the schools along that street. He asked that ways to have the entrances somewhere other than on 19 th Avenue should be considered.

8 Minutes Regular Waseca City Council meeting January 5, 2016 page 8 It was moved by Tlougan, seconded by Rose, to approve the Market Place property pricing structure as presented; the motion carried b Final Payment and Change Order #1 City Hall Roof Repair The work on the City Hall Roof Project, City Project is complete and ready for final payment. The final contract amount is $101, which is less than the contract approved in November 2014 of $116,929. The reason for the difference in final contract price and approved contract price is included in CO #1 which removed the brick fascia from the gable ends of the roof and replaced them with metal panels. This work is a budgeted expense being paid from the Capital Improvement Project Fund Staff recommends a motion to approve Partial Payment #4 and Change Order No. One and Final Payment for City Hall Roof Project, City Project It was moved by Salsbury, seconded by Arndt, to approve Final Payment and Change Order #1 for City Hall Roof Repair as presented; the motion carried 7-0. CONSENT AGENDA 9 It was moved by Tlougan, seconded by Christiansen, to approve the Consent Agenda as presented; the motion carried 7-0 and included the following actions: a. Minutes Regular City Council meeting December 15, 2015 were accepted and placed on file. b. Payroll & Expenditures December 2015 were authorized for payment. CITY MANAGER S REPORT 10 The City Manager provided the following information: At the next Council meeting the Council will be discussing aesthetics and street lighting patterns on Elm Avenue. He asked the Council members to keep this in mind and let him know if they have any questions. The City received a DNR complaint regarding approval of variances at Pondview. Staff is in the process of preparing the City s response. 11 The following announcements were made: ANNOUNCEMENTS Councilmember Fitch reminded everyone of the fishing contest on Saturday, January 16 th on Clear Lake at the Boat House. She encouraged everyone to come and enjoy this fun event. Mayor Clemons commented it is time to do the City Manager s 6-month evaluation, since he has been here one year today. He stated he would like to use the same process as last time and will be providing the Councilmembers with papers to fill out and return to him. He will combine the answers and arrange to meet with the City Manager. He congratulated the City Manager on his one year anniversary and thanked him for a good year.

9 Minutes Regular Waseca City Council meeting January 5, 2016 page 9 Mayor Clemons also commented that being mayor is incredibly easy with the staff we have. He commended the street crew, as well as all other staff on the great job they do, and is looking forward to another good year. ADJOURNMENT 12 There being no further business to be brought before the Council, it was moved by Salsbury, seconded by Arndt, to adjourn the meeting at 7:53 p.m.; the motion carried 7-0. MARY BUENZOW RECORDS SECRETARY JOHN CLEMONS MAYOR