City Council Meeting – October 2nd, 2018

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, October 2, 2018, at 5:00 p.m.

Roll call indicated Mayor Corey Theis and Council Members Paul DeBlieck, Matt Smith, Larry Arentson, Jim Sandgren and John T. Buckley were present constituting a quorum.  All members were present.

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

City Attorney Amy Busse requested the addition of Resolution No. 56 of 2018 – Approval of the Purchase Agreement for 512 Veda Drive to the Regular Agenda.

A motion was made by Council Member Sandgren and seconded by Council Member Buckley approving the agenda with the following amendment: Add Agenda Item 9.F. Resolution No. 56 – Approval of the Purchase Agreement for 512 Veda Drive. Motion was carried by unanimous vote.

A motion was made by Council Member Smith and seconded by Council Member Arentson approving the September 18, 2018, minutes as presented.  Motion was carried by unanimous vote.

A motion was made by Council Member Buckley and seconded by Council Member Sandgren unanimously approving the following item of the Consent Agenda.

1.      Insurance Coverage Liability Waiver Form

Mayor Corey Theis opened the public hearing at 5:03 p.m. to discuss Resolution No. 52 of 2018 –Resolution Adopting Assessments for Delinquent Accounts.

No one was present to voice any concerns and Mayor Theis closed the public hearing at 5:04 p.m.

City Administrator Keith Muetzel introduced Resolution No. 52 of 2018 – Resolution Adopting Assessments for Delinquent Accounts. Similar resolutions are brought to the City Council on a quarterly basis in order to improve the time between the delinquent utility bills and the City’s ability to disclose the information to new owners. A delinquent account resolution will be presented at the first meetings in January, April, July, and October of each year.

Delinquent letters are mailed to the utility account holders on a quarterly basis. If the balances are not collected from the account holders, delinquent letters are then mailed to the property owners. Delinquent balances meeting the assessment guideline are published as a requirement of the public hearing process. Any unpaid balances are brought to the City Council to be approved by resolution. The pending assessments already passed by resolution that remain outstanding as of November 1, 2018, will be charged an administrative fee of $50.00 and transferred to the Redwood County Assessor’s Office to be assessed on the tax rolls.

A motion was made by Council Member Smith and seconded by Council Member DeBlieck to waive the reading of Resolution No. 52 of 2018 – Resolution Adopting Assessments for Delinquent Accounts. Motion was carried by unanimous vote.

A motion was made by Council Member Arentson and seconded by Council Member Buckley approving Resolution No. 52 of 2018 – Resolution Adopting Assessments for Delinquent Accounts. Motion was carried by unanimous vote.

Mayor Corey Theis read a Proclamation Declaring October 15, as “National Pregnancy and

Infant Loss Awareness Day”. Mayor Theis expressed the importance of recognizing this day and thanked the City Council for allowing the proclamation.

Resolution No. 53 of 2018 – Resolution Setting and Adopting the 2019 Contract Renewal of Group Health Insurance and the Employer’s Share of Premium for Health Insurance Coverage was presented by Human Resources Coordinator Sheila Stage.

Ms. Stage stated staff worked with the City’s insurance broker, Flexible Benefit Consulting (FBC) to obtain group health insurance proposals for 2019.  FBC negotiated with our current health plan provider Preferred One and they responded with a very competitive bid for 2019 coverage. Staff recommends accepting the renewal of our current group health plan with Preferred One with an overall increase in premium of 1.5%.  This slight increase in contributions is due to slightly higher than normal claims utilization for 2018 as well as a small increase in health care costs due to the Affordable Care Act. The proposal maintains the same coverage provided in 2018.  Staff also calculated employee/employer contributions for 2019 using the 80/20 family policy formula and 90/10 single policy formula approved in prior years.

There was discussion regarding the total cost to the City for individual coverage and family coverage. The decision was made to discuss it further at a City Council Work Session.

A motion was made by Council Member Buckley and seconded by Council Member Smith to waive the reading of Resolution No. 53 of 2018 – Resolution Setting and Adopting the 2019 Contract Renewal of Group Health Insurance and the Employer’s Share of Premium for Health Insurance Coverage. Motion was passed by the following roll call vote.

AYE:   Council Members Arentson, Sandgren, Smith, and Buckley

NO:     Council Member DeBlieck

A motion was made by Council Member Arentson and seconded by Council Member Buckley approving Resolution No. 53 of 2018 – Resolution Setting and Adopting the 2019 Contract Renewal of Group Health Insurance and the Employer’s Share of Premium for Health Insurance Coverage. Motion was passed by the following roll call vote.

AYE:   Council Members Arentson, Sandgren, Smith, and Buckley

NO:     Council Member DeBlieck

Resolution No. 54 of 2018 – DGR Engineering Task #8 Amendment to Master Agreement for Professional Services: Downtown Distribution Conversion – Phase 2 in the Amount of $71,000 was presented by Public Utilities Superintendent Chuck Heins.

Mr. Heins stated this project starts the process of burying the electrical system which supplies power to the downtown business district of Redwood Falls. We are currently in Phase 1 and that process has been progressing well. Phase 2 consists of the area between Minnesota Street and Lincoln Street in the east-west direction, the alley between Second Street and Highway 19/71, and the alley between Third and Fourth Street.

A motion was made by Council Member Smith and seconded by Council Member Sandgren to waive the reading of Resolution No. 54 of 2018 – DGR Engineering Task #8 Amendment to Master Agreement for Professional Services: Downtown Distribution Conversion – Phase 2 in the Amount of $71,000. Motion was carried by unanimous vote.

A motion was made by Council Member Sandgren and seconded by Council Member Arentson approving Resolution No. 54 of 2018 – DGR Engineering Task #8 Amendment to Master Agreement for Professional Services: Downtown Distribution Conversion – Phase 2 in the Amount of $71,000. Motion was carried by unanimous vote.

Resolution No. 55 of 2018 – Resolution Setting and Adopting the Contract Renewal of Group Life Insurance and Long Term Disability was presented by Human Resources Coordinator Sheila Stage.

Ms. Stage stated Our Long Term Disability Rates have remained unchanged since 2015 at $.0375 per $100 of cover payroll.  This rate was based on the action the Council took in approving the City to join the LMC Municipal Pool with its insurer Madison National Insurance. This rate guarantee will remain through December 31, 2019.

Ms. Stage stated the City is now coming off a 3-year rate guarantee from MN Life.  Based on this, MN Life reviewed our group demographics and based on this information our Basic Life Rate or City provided rate will increase from $.125 to $.145 per $1000 per month. Our AD&D will remain unchanged at .02 per $1000 per month.  This overall increase is due to the age and gender of our workforce.  This rate increase will take effect on January 1, 2019 and MN Life confirmed that these rates will enter year one on January 1, 2019 of a 3-year rate guarantee continuing through December 31, 2021. The supplemental employee, spouse, and child life rates will remain unchanged effective on January 1, 2019.  The monthly Child Life Rate is $1.30 per $10,000.

A motion was made by Council Member Sandgren and seconded by Council Member Buckley to waive the reading of Resolution No. 55 of 2018 – Resolution Setting and Adopting the Contract Renewal of Group Life Insurance and Long Term Disability. Motion was carried by unanimous vote.

A motion was made by Council Member DeBlieck and seconded by Council Member Arentson approving Resolution No. 55 of 2018 – Resolution Setting and Adopting the Contract Renewal of Group Life Insurance and Long Term Disability. Motion was carried by unanimous vote.

Public Works Project Coordinator Jim Doering discussed the Geographic Information Systems Phase II proposal. A demonstration of the current GIS layers was shown.

Mr. Doering stated staff is recommending to approve the quote for Bolton and Menk Inc.’s GIS department to digitize on our GIS system the following items: building code jurisdiction, easements, plats, and project plan sets at the hourly and per piece rates provided in the quote. By approving the quote, Council will authorize the Mayor and/or City Administrator to execute the quote and subsequent work order(s)for the listed services and negotiate related contracts, agreements or amendments pursuant to the City’s procurement policy.

Mr. Doering stated in 2014, the City Council approved the creation of an organizational Geographic Information System (GIS) Phase I, for the City of Redwood Falls.  This series of mapping layers has been used for permitting, zoning, planning, building code and administrative decision-making on a daily basis.

Phase I consisted of developing the base platform, which included an aerial overlay of the City, roads, lot parcels, zoning, FEMA flood zones, and geographic two foot contours. In addition, the three most innovative layers were the storm sewer, sanitary sewer and water main infrastructure.  These layers contain the pipe layouts, direction of flow and locations of outlets, manholes, valves and curb stops etc.  Recently a fourth utility has been added. The electrical system layer is available to aid in planning, locations and repair tracking.

Mr. Doering stated Phase II of the platform build will include adding an easement layer by digitizing the known 430 narrative easements on file, 123 plat maps and platted easements, 95 listings in Auditors Subdivision and 60+ plan sets covering construction projects over the last 20 years. Staff and Council will be able to access the information via the web, which will further enhance:

•           Easier transition of knowledge among users

•           Increased information research efficiency

•           Ease of mapping access via internet and mobile devices

•           Eliminates the need for specialized GIS staffing

Approval of this quote accepts the predominant hourly rate of $120.00 for digitizing and $70 for scanning.  The current file counts have set the stated cost at approximately $28,740.00 that will be divided by the four utilities (water, storm sewer, sanitary sewer and electric) of $7,185.00 each for professional services.

A motion was made by Council Member DeBlieck and seconded by Council Member Sandgren approving the quote from Bolton and Menk Inc. for $28,740.00. Motion was carried by unanimous vote.

City Attorney Amy Busse presented the council with Agenda Item 9.F. Resolution No. 56 of 2018 – Approval of the Purchase Agreement for 512 Veda Dr.

On August 21, 2018, the City Council awarded a contract for real estate services to Scenic City Reality to assist the City with selling three homes located around the hospital. Geri Theis is the lead real estate agent handling the sale of the homes. Ms. Theis met with City staff to suggest and justify the listing price for each home. Since listing the homes, Ms. Theis has provided regular updates and listing activity reports on the homes.

On September 18, 2018 Ms. Theis met with the City Attorney to discuss an offer that was made on the home located at 512 Veda Drive. The listing price for the home is $209,400.00. The offer made by the potential buyers took into consideration the fact that the windows, doors, asbestos removal and flooring all needed to be addressed when presenting their cash offer of $180,000. This offer is contingent on passing a home inspection, with the understanding that the potential buyers already negotiated the above issues when making their offer of $180,000.00.

During the discussion of the first offer, Ms. Theis received another offer on the same home. The second offer is for $193,000.00 but the potential buyer wants the City to pay $8,000.00 in closing costs and it involves FHA financing which would require its own inspection of the home. This second offer does not take into consideration the issues with the windows, doors, asbestos removal or flooring and there is a very strong likelihood that those issues would come up during the FHA required inspection which could then be used by the potential buyers as a way to negotiate a lower price for the home.

Both offers were presented to the “Veda Drive Housing Committee” which includes: Council Member Jim Sandgren, Council Member Larry Arentson, Director of Finance & Administrative Services Missi Meyer, Project Coordinator Jim Doering, and the City Attorney Amy Busse. After discussions, the committee decided that there is less risk with the cash offer and authorized the City Attorney to present a counter offer to Ms. Theis to present to the potential buyers who made the first offer in the amount of $186,500.00. The counter offer was accepted pending an inspection.

On Monday, October 1, 2018 Ms. Theis informed City staff that the results of the inspection discovered a radon level that needs to be mitigated along with some other concerns centered on electrical updates and the condition of the central air and hot water heater. As such, the buyers countered with a cash offer of $183,000.00. The committee reviewed the counter offer and is recommending Council enter into the purchase agreement with a purchase price of $183,000.00.

A motion was made by Council Member Sandgren and seconded by Council Member Arentson to waive the reading of Resolution No. 56 of 2018 – Approval of the Purchase Agreement for 512 Veda Drive. Motion was carried by unanimous vote.

A motion was made by Council Member Buckley and seconded by Council Member Sandgren approving Resolution No. 56 of 2018 – Approval of the Purchase Agreement for 512 Veda Drive. Motion was carried by unanimous vote.

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

There being no further business, a motion was made by Council Member Smith and seconded by Council Member Arentson to adjourn the meeting at 5:54 p.m.  Motion was carried by unanimous vote.