City Council Meeting – November 19, 2019

MINUTES
REGULAR COUNCIL MEETING
CITY OF REDWOOD FALLS, MINNESOTA
TUESDAY, NOVEMBER 19, 2019

Pursuant to due call and notice thereof, a regular meeting of the Redwood Falls City Council was called to order in the Municipal Chambers on Tuesday, November 19, 2019, at 5:00 p.m.

Roll call indicated Council Members Matt Smith, Larry Arentson, Jim Sandgren, John T. Buckley, and Denise Kerkhoff were present constituting a quorum. Mayor Tom Quackenbush was absent.

Also present were City Administrator Keith Muetzel, Director of Finance & Administrative Services Melissa Meyer, Public Works Project Coordinator Jim Doering, City Attorney Amy Busse and Council Secretary Caitlin Kodet.

A motion was made by Council Member Sandgren and seconded by Council Member Arentson to approve the agenda. Motion passed by unanimous vote.

A motion was made by Council Member Kerkhoff and seconded by Council Member Buckley to approve the November 5, 2019, minutes as presented. Motion passed by unanimous vote.

Norma Hagert was present to address the Council regarding reoccurring potholes in the alley behind her property on East Fifth Street. Ms. Hagert stated the potholes have been filled by the Street Department in the past but continue to be a problem. Mr. Muetzel stated the Street Department will be utilizing a new piece of equipment on gravel alleys in the spring and will continue to monitor the potholes.

A motion was made by Council Member Buckley and seconded by Council Member Arentson to approve the following items on the Consent Agenda.

1. Parade Permit Application – Redwood Area Chamber & Tourism
2. 2020 Business License Renewals

Motion passed by unanimous vote.

Shannon Sweeney with David Drown and Associates was present to introduce the bids received for the refinancing of 2011B Electric Utility Revenue Bonds.

Mr. Sweeney stated approximately one month ago the City initiated a discussion regarding the refinancing of the 2011B Electric Utility Revenue Bonds. At that time, net present value savings of approximately $88,690 were projected if the City was interested in receiving proposals from lending institutions for a negotiated bank placement. Staff indicated that they were willing to consider proposals which were to be solicited by R.W. Baird in its role as placement agent. Information pertaining to the proposed refinance was sent out to all local lenders as well as other lending institutions both regionally and nationally that have expressed interest in past financings.

Mr. Sweeney stated on October 23, 2019 two proposals were received including a proposal from Branch Banking & Trust Company (BB&T) and Bremer Bank. The Bremer Bank proposal did not produce net debt service savings. The BB&T proposal includes an interest rate of 2.35% and produces net present value savings of $119,083.33. Gross Savings (payment reduction over the life of the bond issue) are $139,955.58. The total project cost would be $2,415,000.00 to be sourced by the 2019A Electric Utility Refunding Bonds. The City will be required to pledge electric system revenues for the repayment of this bond issue. Additionally, the City

shall maintain debt coverage of 120% and revenues shall produce at least 115% debt coverage on any new debt that is to be issued. The bonds can only be called in whole after December 1, 2025.

Mr. Sweeney further stated consideration was given to other methods of sale including a competitive sale of bonds. This negotiated bank placement was considered the most efficient as issuance costs were significantly reduced and the City did not have risk associated with the purchase of a credit rating. Staff is recommending to award the bond sale to BB&T based on the terms received with a closing of December 5, 2019.

A motion was made by Council Member Sandgren and seconded by Council Member Kerkhoff to waive the reading of Resolution No. 39 of 2019 – Refinance of 2011B Electric Utility Revenue Bonds. Motion was carried by unanimous vote.

A motion was made by Council Member Arentson and seconded by Council Member Smith to approve Resolution No. 39 of 2019 – Refinance of 2011B Electric Utility Revenue Bonds. Motion was carried by unanimous vote.

City Attorney Busse introduced Resolution No. 40 of 2019 – Resolution Adopting Assessment for Unpaid Costs Associated with Razing and Removing Hazardous Structures at 120 E. Wyoming.

Ms. Busse stated the City started the process to abate hazardous/dangerous structures owned by the First Evangelical Christian Church located at 120 E. Wyoming back in February of 2018. The City attempted to work with the owner, who was represented by Richard Clements throughout the entire process. Despite the City’s efforts to work with Mr. Clements to abate the hazardous structures, the property owners did not comply with Resolution No. 6 of 2018 whereby the Council found the structures to be hazardous and provided a specific timeframe to get the structures back in compliance. The very same Resolution allowed for the City Attorney to proceed with enforcement of the Resolution in District Court if so required.

Ms. Busse stated as the City Attorney, she filed the matter in District Court and on July 19, 2018, Judge Rohland upheld the City’s Resolution and found the structures to be dangerous/hazardous. Judge Rohland ordered the structures to be abated by a specific timeframe, however if that was not done, the Order granted the City the authority to enter onto the property to remove the structures and to recover all costs and expenses associated with the removal. Again, the property owner did not comply with the District Court Order and so the City removed the structures. The City Attorney then went back to District Court and got another Order dated February 27, 2019 whereby the Court certified a judgement of deficiency for $18,391.30 and allowed the City to specially assess any unpaid balance as a lien against the property if not paid by October 1, 2019.

Ms. Busse stated to date, the property owner has not made any payment to the City nor contacted the City to set up a payment arrangement. On October 1, 2019, the Council adopted Resolution No. 34 of 2019 that certified the unpaid balance of $18,391.30 in order for the amount to be assessed against the property however the Resolution incorrectly identified the amount owed as a maintenance cost under Redwood Falls City Ordinance 10.62.

Ms. Busse further stated the proposed Resolution allows for the City to repeal Resolution No. 34 of 2019 and to certify the unpaid balance of $18,391.30 as a special assessment to be a lien against the property pursuant to Redwood Falls City Ordinance 4.21 and Minn. Stat. §§463.21-463.22. First Evangelical Christian Church as well as Richard Clements were provided proper notice of the assessment hearing at least 14 days prior to the Council meeting.

Frank Munshower was present to speak on behalf of his client Richard Clements. Mr. Munshower questioned the City’s ability to obtain a court order judgement to repay the costs associated with the razing and removing of the structure and then also assess the property.

Ms. Busse stated during the District Court process she specifically requested that the Court issue an Order that allows the City to specially assess any unpaid balance as a lien against the property if not paid by October 1, 2019. The February 27, 2019 order granted the City Attorney’s request.

Richard Clements was present to address the Council. Mr. Clements stated he disagrees with the City’s ability to assess the property after the court order judgement was obtained.

Council Member Buckley stated the Council gave Mr. Clements and First Evangelical Christian Church plenty of time to correct the issue and they were unable to make any progress on the required repairs. The Council needed to move forward with specially assessing the unpaid balance as a lien against the property.

A motion was made by Council Member Arentson and seconded by Council Member Sandgren to waive the reading of Resolution No. 40 of 2019 – Resolution Adopting Assessment for Unpaid Costs Associated with Razing and Removing Hazardous Structures at 120 E. Wyoming and to Repeal Resolution No. 34 of 2019. Motion was carried by unanimous vote.

A motion was made by Council Member Buckley and seconded by Council Member Kerkhoff to approve Resolution No. 40 of 2019 – Resolution Adopting Assessment for Unpaid Costs Associated with Razing and Removing Hazardous Structures at 120 E. Wyoming and to Repeal Resolution No. 34 of 2019. Motion was carried by unanimous vote.

Public Works Project Coordinator Doering introduced Courthouse Square Project – Change Order #1.

Mr. Doering stated staff is recommending to extend the final completion date from November 30, 2019 to June 30, 2020 for turf establishment. The work was substantially completed and the project was in a condition for safe and convenient use of the travelling public on November 1, 2019. Site conditions for a fall seeding deteriorated rapidly. The extension will allow for a spring installation and seeding that will produce a professional uniform product with quality results. The site is stabilized with hydro-mulch that included a tackifier-polymer to adhere to and hold the soil to prevent erosion. Grass seed was not added due to the inability to complete final grading. This will be completed in spring upon approval.

A motion was made by Council Member Smith and seconded by Council Member Sandgren to approve Courthouse Square Project – Change Order #1. Motion was carried by unanimous vote.

City Administrator Muetzel gave an update on the implementation of the I & I Reduction Program. Mr. Muetzel stated this process required two different steps up to this point. Step one consisted of about six months of background research to get to the point of being able to present and adopt an updated I & I Ordinance. Step two is where we are at now with developing the policies needed to implement the Ordinance.

Mr. Muetzel stated City staff is aware that there is still some confusion from residents regarding how the I & I Reduction Program will be implemented. Staff has met with various landowners regarding their concerns and is currently working to develop the policies for implementation.

Mr. Muetzel stated the City does not want to rush this process. We want to take the time to educate residents. The City will be hosting an open house on Thursday, December 5, 2019 from 1:00 p.m. to 7:00 p.m. at the Redwood Area Community Center. The open house will be for all residents of the City to attend. ISG will also have a team at the open house to assist with questions.

Bills and Claims were presented to Council for informational purposes. No questions, comments or concerns were raised.

There being no further business, a motion was made by Council Member Kerkhoff and seconded by Council Member Buckley to adjourn the meeting at 5:46 p.m. Motion passed by unanimous vote.