City Council Meeting – December 3, 2024

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, December 3, 2024, at 5:00 p.m.

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

Also present were City Administrator Keith Muetzel, Finance Director Kari Klages, City Attorney Trenton Dammann, Public Works Project Coordinator Jim Doering, and Deputy City Clerk Caitlin Kodet.

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

A motion was made by Council Member Smith and seconded by Council Member Buckley to approve the November 12, 2024, minutes as presented. Motion passed by unanimous vote.

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

1. 2025 Business License Applications
2. Request to Waive Sanitary Sewer Charges – 324 South DeKalb Street

Motion passed by unanimous vote.

Finance Director Klages introduced Resolution No. 73 of 2024 – A Resolution Accepting A Donation To The City.

Ms. Klages stated Minnesota Statutes, Section 465.03 gives the City authority to receive donations and requires them to be formally accepted by resolution, adopted by a two-thirds vote of the Council. Resolution No. 73 of 2024 is to accept a financial donation for the Redwood Falls Fire Department in the amount of $1,000.00 from Minnwest Bank.

A motion was made by Council Member Buckley and seconded by Council Member Kerkhoff to waive the reading of Resolution No. 73 of 2024 – A Resolution Accepting A Donation To The City. Motion passed by unanimous vote.

A motion was made by Council Member Arentson and seconded by Council Member Smith to approve Resolution No. 73 of 2024 – A Resolution Accepting A Donation To The City. Motion passed by unanimous vote.

Parks & Recreation Director Ross Nachreiner introduced Resolution No. 74 of 2024 – A Resolution Accepting A Donation To The City.

Mr. Nachreiner stated Resolution No. 74 of 2024 is to accept a financial donation in the amount of $10,000.00. The Redwood Valley Baseball Association & Redwood American Legion Post #38 each gave $5,000.00. These donations will go towards the construction costs of the new bathroom facility at the Memorial Park Baseball Field.

Mr. Nachreiner stated Staff would like to thank members of the Redwood Valley Baseball Association & Redwood American Legion Post #38 for their generous donation. Their continued support has helped make some much-needed improvements over the past 10 years. Staff is requesting approval to accept the financial donations from The Redwood Valley Baseball Association & Redwood American Legion Post #38 in the amount of $10,000.00.

A motion was made by Council Member Kerkhoff and seconded by Council Member Buckley to waive the reading of Resolution No. 74 of 2024 – A Resolution Accepting A Donation To The City. Motion passed by unanimous vote.

A motion was made by Council Member Smith and seconded by Council Member Arentson to approve Resolution No. 74 of 2024 – A Resolution Accepting A Donation To The City. Motion passed by unanimous vote.

Parks & Recreation Director Ross Nachreiner introduced Resolution No. 75 of 2024 – A Resolution Accepting A Donation To The City.

Mr. Nachreiner stated Resolution No. 75 of 2024 is to accept a financial donation in the amount of $15,000 from Dennis Honetschlager for dog park improvements. City Staff would like to thank Dennis Honetschlager for his generous donation. Staff is requesting approval to accept the financial donation from Dennis Honetschlager in the amount of $15,000.00.

A motion was made by Council Member Arentson and seconded by Council Member Buckley to waive the reading of Resolution No. 75 of 2024 – A Resolution Accepting A Donation To The City. Motion passed by unanimous vote.

A motion was made by Council Member Kerkhoff and seconded by Council Member Smith to approve Resolution No. 75 of 2024 – A Resolution Accepting A Donation To The City. Motion passed by unanimous vote.

Public Utilities Superintendent Jason Halvorson was present to introduce Resolution No. 76 of 2024 – Authorization To Execute Purchase Of Materials For The 2025 Distribution Improvements.

Mr. Halvorson stated the 2025 Distribution Improvements, DGR Project No. 421127, were approved by Council on September 17, 2024. To complete the project, certain materials needed to be bid. The bids were received and opened on Thursday, November 21, 2024, at 1:15 p.m. at City Hall. Six (6) bids were received, the results of the bids have been reviewed and tabulated by DGR and provided to Council for consideration. The total cost of all the bids is $729,659.41. Staff recommends the contracts be awarded as presented; Bid #1 for Padmounted Switchgear and Box Pads to Irby Utilities for $163,506.00; Bid #2 for 15KV Primary Wire to Irby Utilities for $251,025.75; Bid #3 for Single Phase Transformers and Box Pads to RESCO for $242,642.06; and Bid#4 600V Secondary Wire to RESCO - $72,485.60.

A motion was made by Council Member Smith and seconded by Council Member Buckley to waive the reading of Resolution No. 76 of 2024 – Authorization To Execute Purchase Of Materials For The 2025 Distribution Improvements. Motion passed by unanimous vote.

A motion was made by Council Member Arentson and seconded by Council Member Kerkhoff to approve Resolution No. 76 of 2024 – Authorization To Execute Purchase Of Materials For The 2025 Distribution Improvements. Motion passed by unanimous vote.

Finance Director Klages introduced Resolution No. 77 of 2024 – Resolution Establishing Rates for Municipal Electric Utilities.

Ms. Klages stated every year, DGR updates the overall cash flow projections and proposes any necessary rate changes. The proposed rates have been developed to provide an overall increase in revenues of 4%. Staff recommend approval of the proposed 2025 electric rates.

A motion was made by Council Member Smith and seconded by Council Member Buckley to waive the reading of Resolution No. 77 of 2024 – Resolution Establishing Rates for Municipal Electric Utilities. Motion passed by unanimous vote.

A motion was made by Council Member Arentson and seconded by Council Member Kerkhoff to approve Resolution No. 77 of 2024 – Resolution Establishing Rates for Municipal Electric Utilities. Motion passed by unanimous vote.

Finance Director Klages introduced Resolution No. 78 of 2024 – Resolution Adjusting Water, Sanitary Sewer, and Storm Sewer Service Charges.

Ms. Klages stated in January of this year, Council approved moving away from using DGR to perform the annual rate studies for water, sanitary sewer, and storm sewer to using Waterworth, a cloud-based software, for a more hands-on continuous utility rate management approach. Staff worked throughout the year with consultants at Waterworth to onboard the City’s utility billing data into the software, as well as to build future cash flow projections, and proposed rate adjustments. Staff then held two meetings with the budget committee in which multiple rate options were reviewed. Two major focal points for setting 2025 rates focused on the need to increase base charges to keep up with the cost of infrastructure replacement, as well as looking at billing equity between various customer classes (commercial versus residential). To address both these areas, a new commercial infrastructure base rate is being proposed for water and sanitary sewer utilities and the budget committee recommends the rate adjustments for 2025.

Ms. Klages stated the proposed water rates provide an increase of 5% per 100 cubic feet sold, increase the residential infrastructure replacement charge by $1.55, and increase the commercial infrastructure replacement charge by $7.30. The sanitary sewer rates have been developed to provide an increase of 10% per 100 cubic feet used, increase the residential infrastructure replacement charge by $1.96, and increase the commercial infrastructure replacement charge by $5.21. The storm sewer rates have been developed to provide an increase of 8% per infrastructure replacement charge. Staff recommends approval of the proposed 2025 rates.

A motion was made by Council Member Smith and seconded by Council Member Buckley to waive the reading of Resolution No. 78 of 2024 – Resolution Adjusting Water, Sanitary Sewer, and Storm Sewer Service Charges. Motion passed by unanimous vote.

A motion was made by Council Member Arentson and seconded by Council Member Kerkhoff to approve Resolution No. 78 of 2024 – Resolution Adjusting Water, Sanitary Sewer, and Storm Sewer Service Charges. Motion passed by unanimous vote.

Finance Director Klages introduced Resolution No. 79 of 2024 – Resolution Setting Fee Schedule for 2025.

Ms. Klages stated City Staff reviewed the proposed fee schedule. Proposed changes to the 2025 Fee Schedule are indicated in red, fees in purple are set by City Resolution or City Ordinance, and the fees in blue are set or limited by State Statute. Staff is recommending approval of the proposed 2025 Fee Schedule.

A motion was made by Council Member Arentson and seconded by Council Member Buckley to waive the reading of Resolution No. 79 of 2024 – Resolution Setting Fee Schedule for 2025. Motion passed by unanimous vote.

A motion was made by Council Member Kerkhoff and seconded by Council Member Smith to approve Resolution No. 79 of 2024 – Resolution Setting Fee Schedule for 2025. Motion passed by unanimous vote.

City Administrator Muetzel introduced the RFPEA Contract Renewal.

Mr. Muetzel stated City Staff has met with the Redwood Falls Public Employees Association (RFPEA) bargaining committee to negotiate the renewal of the RFPEA contract. The existing RFPEA contract covers the water/wastewater operators, street maintenance workers/mechanic, and full-time liquor store clerks. A tentative contract agreement was reached and is subject to formal approval by the RFPEA membership. The proposed contract duration will be three (3) years and expire on December 31, 2027. The proposed contract increases the annual uniform allowance from $400.00 to $550.00 and paid out with bi-weekly payroll as well as increases the maximum amount of sick leave paid out as severance by 75 hours per tier, effective December 31, 2027.

Mr. Muetzel further stated the proposed contract would place RFPEA members within the following pay grades as recommended by the 2024 Employee Classification and Compensation Study; Water/Wastewater Foreman placed at pay grade six (6), Water/Wastewater Operator and Street Maintenance Foreman placed at pay grade five (5), Street Maintenance Worker/Mechanic placed at pay grade four (4), and Liquor Store Clerk placed at pay grade one (1). Subsequent steps will increase by three percent (3%) during each year of the contract. There are also a couple of other minor contract language changes to comply with the new State of MN Earned Sick and Safe Time Law.

A motion was made by Council Member Smith and seconded by Council Member Kerkhoff to approve the proposed RFPEA Contract Renewal for 2025, 2026, and 2027. Motion passed by unanimous vote.

Human Resources Coordinator Sheila Stage was present to introduce the Implementation of Class and Compensation Study for Non-Union Employees.

Ms. Stage stated in early 2024, City Staff worked with DDA Human Resources Inc. to complete an Employee Classification and Compensation Study. The study involved an evaluation of full-time positions to ensure that jobs are appropriately classified and meet FLSA guidelines, ensure pay is externally competitive and internally equitable, provide policies and procedures to keep the compensation system up-to-date, and develop a compensation system that is easy to understand and administer.

Ms. Stage stated the market analysis component of the study identified 19 cities and one county that were used as a comparable peer group. Factors considered in establishing the peer group include geographic proximity, population, services provided, employment retention, and recruiting trends. DDA gathered job duties and wage data from the peer group to compare the City’s actual compensation with that of the market. For each position, the difference between the City’s actual compensation and the market was calculated and positions that were within +/- 10% were considered to be aligned with the market.

Ms. Stage further stated the results of the market analysis were used to develop a new salary structure for the entire organization. The new salary structure includes 14 pay grades and there are 11 steps within each grade. On January 1, 2025 employees will be assigned a pay grade and placed within the proposed salary structure at the next step that is closest to their salary with a 2% minimum increase. Steps will be increased by 3% in January of 2026 and 2027. The proposed pay plan will be in effect until December 31, 2027, which aligns with the City’s three union agreements. The City currently has four separate salary structures, one for each bargaining group. Upon implementation of the new salary structure, all full-time employees (union and non-union) will be on the same salary structure and there will no longer be a separate salary structure for each bargaining group. Staff recommend approval of the proposed salary structure.

A motion was made by Council Member Buckley and seconded by Council Member Smith to approve the Implementation of Class and Compensation Study for Non-Union Employees. Motion passed by unanimous vote.

City Administrator Muetzel introduced the IT Coordinator Position.

Mr. Muetzel stated the hiring committee has completed the selection process for the IT Coordinator position. The committee interviewed seven applicants and recommends approval of the employment offer to Noah Johnson. Noah has an associate degree in computer and networking technology and currently works as a technology coordinator for the SWWC Service Cooperative and is an adjunct instructor at the Minnesota West Community and Technical College. Mr. Johnson will start on January 6, 2025 with a starting salary at Grade 7, Step 3 of the 2025 City of Redwood Falls Step Structure.

A motion was made by Council Member Arentson and seconded by Council Member Buckley to approve the IT Coordinator Position employment offer to Noah Johnson. Motion passed by unanimous vote.

Council Member Buckley stated resident Don Hazen approached him with the idea of starting a commission or committee for tree beautification. A group will be needed to address the impending effects of Emerald Ash Borer. A tree committee would address the removal and replacement needs.

City Administrator Muetzel stated the next City Council Meeting is scheduled for December 17, 2024 at 6:00 p.m.

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 Kerkhoff and seconded by Council Member Smith to adjourn the meeting at 5:55 p.m. Motion passed by unanimous vote.