07/12/1999 - 4655� K
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AGENDA FOR PUBLIC REFERENCE
CI'I'�' COUNCIL MEETING
JULY 12,1999
� FRIDLEY CITY COIINCIL MEETING
�,�r ATTENDENCE SHEET
� Mo�.day, Ju.Y.y 12, 1999 ;
.. " 7:30 P.M.
PLEASE PRINT NAME, ADDRESS AND ITEM NUMBER YOU ARE INTERESTED IN
ITEM
nornrm u�MF. �rT.F.ARLYI ADDRESS NUMBER
r
� CITY COUNCIL MEETING OF JULY 12, 1999
CRY OF
FRIDLEY
The City of Fridley will not discriminate against or harass anyone in the admission or access
to, or treatment, or employment in its services, programs, or activities because of race, color,
creed, religion, national origin, sex, disability, age, marital status, sexual orientation or status
with r�gard to pu�:ic assistan�e. Upon request, a��ommodation will be provided to allow
individuals with disabilities to participate in any of Fridley's services, programs, and activities.
Hearing impaired persons who need an interpreter or other persons with disabilities who
require auxiliary aids should contact Roberta Collins at 572-3500 at least one week in advance.
(TTD/572-3534)
PLEDGE OF ALLEGIANCE.
PROCLAMATION:
National Night Out — Tuesday, August 3, 9999
APPROVAL OF MINUTES:
�ity Courrcil Meetinc� of June 14, 1999
City Council Meeting of June 28, 1999
� �.
FRIDLEY CITY COUNCIL MEETING OF JULY 12,1999 PAGE 2
APPROVAL OF PROPOSED CONSENT AGENDA:
NEW BUSINESS:
1. Resolution Approving the Issuance and Sale of the
$200,000 Subordinated Senior Housing Revenue
Note, Series 1999 and Authorizing the Execution of
Documents Relating Thereta �Banfifl Crossing Homes -
Project) ....................................................................................... 1 - 14
2. Appointments: City Employees ...................................................... 15
3. Claims ....................................................................................... 16
4. Licenses ....................................................................................... 17 - 19
5. Estimates ....................................................................................... 20
ADOPTIO(� OF AGENDA.
OPEN FORUM, VISITORS:
(Consideration of Items not on Agenda - 15 Minuies)
��
FRIDLEY CITY COUNCIL MEETING OF JULY 12,1999 PAGE 3
PUBLIC HEARING:
6. Ordinance of the City of Fridley, Minnesota,
Amending the City Code to Include a New
Chapter 409, Entitled "Franchise Fees" .......................................... 21 - 34
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7. Informai Status Reparts ................................. ..................... 35
ADJOURN.
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CRY OF
FRIDIEY
��1��� -���s ��'�
CITY COUNCIL MEETING OF JULY 12, 1999
The City of Fridley will not discriminate against or harass anyone in the admission or access to, or treatment, or employment in
its services, programs, or activities because of race, color, creed, religion, national origin, sex, disability, age, marital status,
sexual orientation or status with regard to public assistance. Upon request, accommodation will be provided to allow
individuals with disabilities to participate in any of Fridley's services, programs, and activities. Hearing impaired persons who
need an interpreter or other persons with disabilities who require auxiliary aids should contact Roberta Collins at 572-3500 at
least one week in advance. (TTD/572-3534)
�J ;�t ✓1 � � ,� �
PLEDGE OF ALLEGIANCE.
PROCLAMATION:
Nationa! Night Out — Tuesday, August 3, 1999
APPROVAL OF MINUTES:
City Council Meeting of June 14, 1999
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City Council Meeting of June 28, 1999 �
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APPROVAL OF PROPOSED CONSENT AGENDA:
NEW BUSINESS: ��„ �`�+1��
1. Resolution Approving the Issuance and Sale of the
$200,000 Subordinated Senior Housing Revenue
Note, Series 1999 and Authorizing the Execution of
Documents Relating Thereto (Banfill Crossing Homes
Project) ................................................... 1 - 14
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APPROVAL OF PROPOSED CONSENT AGENDA:
NEW BUSINESS (CONTINUED):
2. Appointments: City Employees
3. Claims
4. Licenses
5. Estimates
15
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...... 17 - 19
...................... 20
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ADOPTION OF AGENDA.
OPEN FORUM, VISITORS:
(Consideration of Items not on Agenda - 15 Minutes)
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FRIDLEY CITY COUNCIL MEETING OF JULY 12, 1999
PUBLIC HEARING: ���t V�� 1�-,�' ��,�..�w�� �t(( ,�s.� ��
6. Ordinance of the City of Fridley, Minnesota, �'�� �'�'"'� �►�"�"�
Amending the City Code to Include a New
Chapter 409, Entitled "Franchise Fees" 21 - 34
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7. Informal Status Reports .................. 35
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PAGE 2
PROCLAMATION
NATIONAL NIGHT OUT
Tuesday, August 3, 1999
WHEREAS, the National Association of Town Watch (NATW) is sponsoring a unique,
nation-wide crime, drug and violence prevention program on August 3, 1999 called
"National Night Out",• and
WHEREAS, the "16th Annual National Night Out"provides a unique opportunity for Fridley
to join forces with thousands of other communities across the country in promoting
cooperative, police-community crime prevention efforts; and
WHEREAS, Fridley plays a vital role in assisting the Fridley Police Department through
joint crime, drug and violence prevention efforts in Fridley and is supporting "National
Night Out 1999" locally; and
WHEREAS, it is essen tial that all citizens of Fridley be aware of the importance of � crime
prevention programs and the impact that their participation can have on reducing crime,
drugs and violence in Fridley; and
WHEREAS, police-community partnerships and neighborhood cooperation, awareness and
safety are important themes of the "National Night Out"program;
NOW THEREFORE, BE IT RESOLVED, that I, Mayor Nancy J. Jorgenson, Mayor of the
City of Fridley, do hereby proclaim Tuesday, August 3, 1999, as:
NATIONAL NIGHT OUT
BE IT FURTHER RESOLVED, that I, Mayor Nancy J. Jorgenson, do j�ereby call upon all
citizens of Fridley to join the Fridley Police Department and the National Association of
Town Watch in supporting the "16rh Annual National Night Out" on August 3, 1999.
IN WITNESS WHEREOF, I have set my
hand and caused the seal of the City of Fridley
to be affixed this 12th day of July, 1999.
NANCY J. JORGENSON, MAYOR
.
THE MINUTES OF THE FRIDLEY CITY COUNCIL MEETING OF
f UNE 14,1999
�
'�
■
THE MINUTES OF THE REGULAR NIEETING OF THE FRIDLEY CITY COUNCIL
OF JUNE 14.1999
The Regular Meeting of the Fridley City Council was called to order by Mayor Jorgenson at
7:30p.m.
PLEDGE OF ALLEGIANCE:
Mayor Jorgenson led the Council and audience in the Pledge of Allegiance to the Flag.
ROLL CALL:
MEMBERS PRESENT: Mayor Jorgenson, Councilmember Barnette, Councilmember
Billings, Councilmember Bolkcom and Councilmember Wolfe.
MEMBERS ABSENT: None
PRESENTATION:
City of Fridley SOth Anniversary and Fridley'49er Days: June 16-20, 1999
Fridley '49er Days President: Chuck McKusick
Mr. McKusick introduced Mandy Jachymowski, Stacey Ellestad, and Angela Nolan as the
official Fridley '49er Days royalty. Stacy Ellestad was Miss Fridley, and Angela Nolan and
Mandy Jachymowski were the Fridley Princesses. Mr. McKusick commended the '49er Days
royalty for being truly outstanding members of the community. He was very proud to include
them in the '49er Days. Selection of the new royalty will be held Sunday night at the Fridley
Senior High School auditorium. The pageant begins at 6:30 p.m.
Mr. McKusick highlighted the events for '49er Days: Wednesday night will be the carnival
(discount ride tickets of six rides for $5.00 are available in the Recreation Department).
Thursday the parade starts at 6:30 p.m. preceded at 6:25 p.m. by Run for Fun. Friday and
Saturday will be the concert with the White Sidewalls and the Rockin' Hollywoods along with
the carnival. On Sunday afternoon, the SOth Anniversary All-Class Reunion will be held and the
pageant follows at 6:30p.m. Anyone who needs additional information should call the Fridley
Information Line 612-572-3600, Ext. 349, for detailed information or stop by City offices.
Mr. McKusick indicated that as part of the City's SOth anniversary celebration, on June 26 and 27
at Columbia Arena there will be a craft sale and community garage sale. A community band
concert will also be held at Columbia Arena. Bob's Produce is sponsoring a horseshoe
tournament. There will be free ice cream and beverages. WCCO television will be there for a
live broadcast. In the evening there will be bands, sumo wrestling and then professional
wrestling.
Mr. McKusick concluded by saying there will be lots of fun in Fridley for the next two weeks.
He thanked the community organizations that helped so much to bring this event together.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14.1999 PAGE 2
LEGISLATIVE SESSION UPDATE:
Mayor Jorgenson introduced Senator Steve Novak, Senator pon Betzold, Representative Alice
Johnson and Representative Satveer Chaudhary.
Senator Novak discussed some local items. The crime prevention bill has a requirement that
municipalities have model guidelines for police pursuit. Local law enforcement agencies will be
able to sell forfeited firearms and ammunition to federally licensed dealers. Background checks
on firearm permits will be easier. There will be less discretion for what law enforcement must
tell the public regarding sex offenders. There will be more money available for pollution and for
Y2K challenges. State building codes have been delayed uniil April 15, 2000. A data privacy
bill requires local municipalities to have public guidelines for access to public data. The Police
Commission has been abolished because it is no longer needed. Cities can impose licenses on
amusement and arcade games, prohibiting violent video games for citizens eighteen years of age
or younger. The process of amortization is prohibited. Bleacher safety was an issue which was
vetoed. The mandate is there but not the money. There is about one billion dollazs allocated for
road construction. Items that did not pass are .08 blood alcohol level, a proposal to have
concealed weapons, and a proposal to reduce vehicle license tabs.
Representative Johnson covered the issues regarding tri-partisan government and affirmed that
she thought it worked quite well. She spent most of her time in the area of education. She gave
credit to the parents of Fridley school children for the schools getting as much money as they did
for education. The other item she is happy about is that legislation phased out the emissions
testing program.
Representative Chaudhary, who represents the southern third of Fridley, gave a brief report on
how the legislative session went for that area. Income taxes will go down, residents will receive
rebate checks directly in August or September. Schools have a healthy investment due to efforts
of parents, teachers and staff of Fridley school districts. Fridley received approximately $50,000
to assist with the Medtronic project. The business aspect of Fridley is just exploding. Fridley
has received $50,000 for the Fridley Historical Society to enhance appreciation for this great
City's history.
Senator Betzold highlighted the legislati�e session also. Record housing bill passed, significant
gains were made for education and record tax cuts were recorded. There was also significant
reorganization of funding for job training. He mentioned specific efforts on behalf of the City
relating to Medtronic, which is significant not only to Fridley's future but the State of Minnesota.
He felt privileged to be part of that and also wanted to thank the Mayor and entire City staff on
the work that was done.
Councilman Billings stated that he was especially grateful for the things the four of them have
done. They are much more global than just the City of Fridley. He knows they have worked
very hard to see that the issues for the other cities in Minnesota get fine tuned, and that they are
supported and passed through the various committees they are on. Councilman Billings stated
how aggressively and steadfastly they work toward any legislation that is positive and proactive.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 3
On behalf of himself and the City of Fridley he thanks them for not only Fridley-specifc items
but for those items which are of a positive general nature to the State of Minnesota.
Mayor Jorgensan thanked the senators and representatives for all of their efforts.
APPROVAL OF MINUTES:
Citv Council Meetin� of Mav 10. 1999:
Motion by Councilmember Barnette to approve the regular City Council meeting minutes of
May10, 1999 as presented in writing. Seconded by Councilmember Wolfe.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
Citv Council Meetin� Minutes of Mav 24, 1999:
Motion by Councilmember Bolkcom to approve the regular City Council minutes of
May24,1999 as presented in writing. Seconded by Councilmember Billings.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CA,RRIED UNANIMOUSLY.
INTRODUCTION OF NEW CITY COUNCIL SECRETARY:
Mayor Jorgenson stated that Council has a new secretary. Mr. Burns introduced the new City
Council Secretary, Signe Johnson.
APPROVAL OF PROPOSED CONSENT AGENDA:
OLD BUSINESS:
1. ORDINANCE NO. 1127 TO AMEND THE CITY CODE OF THE CITY OF
FRIDLEY MINNESOTA BY ADDING SECTION 2 TO CHAPTER 506.04
UNATTENDED VEHICLES:
Mr. Burns, City Manager, explained that the amendnient states that vehicles are not to be
parked on City streets between 2:00 a.m. and 6:00 a.m. between November 1 and Mayl.
The current ordinance states that vehicles are to be off City streets during a snow storm
and until streets are cleaned. The change would make our policy on "snow birds" similar
to those of surrounding communities.
WAIVED THE SECOND READING AND ADOPTED ORDINANCE NO. 1127
AND ORDERED PUBLICATION.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14. 1999 PAGE 4
2. ORDINANCE NO. 1128 ESTABLISHING CHAPTER 514 OF THE FRIDLEY
CITY CODE ENTITLED "PRIVATE PROPERTY SNOW AND ICE REMOVAL"
AND APPROVE OFFICIAL TITLE AND SUMMARY ORDINANCE:
Mr. Burns, City Manager stated that the proposed ordinance makes it unlawful to push
snow and ice from private property onto City walkways or streets. It also establishes
progressively more severe fines for repeated violations.
WAIVED THE SECOND READING AND ADOPTED ORDINANCE NO. 1128
AND ORDERED PUBLICATION OF THE OFFICIAL TITLE AND SUMMARY
ORDINANCE.
3. RECEIVE THE MINUTES OF THE PLANNING COMMISSION MEETING OF
JUNE 2, 1999:
RECEIVED THE MINUTES OF THE PLANNING COMMISSION MEETING OF
JUNE 2, 1999.
4. APPROVE THREE-YEAR EXTENSION OF A TRAILER LICENSE FOR
TOTINO-GRACE HIGH SCHOOL:
Mr. Burns stated that the trailer houses guidance counselors from School District #14
who by law provide guidance counseling services to Totino-Grace High School. While
Totino-Grace may lawfully include these services within their building, they currently do
not have space. They are, therefore, asking for the trailer license extension in order to
have time to plan and properly implement the changes needed to accommodate the
guidance counseling services within their main building.
APPROVED THREE-YEAR EXTENSION OF A TRAILER LICENSE FOR
TOTINO-GRACE HIGH SCHOOL.
5. APPROVE JOINT POWERS AGREEMENT BETWEEN THE CITY OF
FRIDLEY AND COUNTY OF ANOKA FOR THE RECONSTRUCTION OF
EAST RIVER ROAD FROM OSBORNE ROAD TO MISSISSIPPI BOULEVARD:
Mr. Burns, City Manager stated that the total cost for reconstruction of this portion of
East River Road was $437,074.97. The City's share of this cost is $113,315.73, including
engineering. The agreement establishes the City's financial participation in the project as
well as the division of maintenance responsibilities between the City and the County.
The terms of this agreement are very similar to past agreements between the County and
the City for construction or reconstruction of the City portion of County highways. Staff
recommended Council's approval.
APPROVED JOINT POWERS AGREEMENT BETWEEN THE CITY OF
FRIDLEY AND COUNTY OF ANOKA FOR THE RECONSTRUCTION OF
EAST RIVER ROAD FROM OSBORNE ROAD TO MISSISSIPPI BOULEVARD.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 5
6. APPROVE LEASE AGREEMENT BETWEEN THE CITY OF FRIDLEY AND
LYNDALE TER�'�1INAL COMPANY FOR THE FRIDLEY LIOUOR
WAREHOUSE STORE (WARD 31: �
Mr. Burns stated that the he was proposing to locate a third Fridley Liquor Warehouse in
the building currently occupied by Cub Foods and Gander Mountain on 57th Avenue. He
outlined the terms and conditions of the proposed lease agreement. He indicated that
Fritz Knaak, City Attorney, has reviewed the lease agreement.
THIS ITEM WAS REMOVED FROM THE CONSENT AGENDA AND PLACED
ON THE REGULAR AGENDA AFTER ITEM NO. 17.
7. APPROVE ARCHITECTURAL AGREEMENT BETWEEN THE CITY OF
FRIDLEY AND KKE ARCHITECTS FOR THE CONSTRUCTION OF A
FRIDLEY LIOUOR WAREHOUSE AT CUB FOODS (I-694 AND UNIVERSITY
AVENUEI (WARD 3):
Mr. Burns, City Manager, stated that the agreement provides for structural, mechanical
and electrical design services. The architect will be involved in preparing designs,
bidding and construction phases of the project. Compensation for these services will be
7.75 percent of construction costs. These are estimated at $650,000. He indicated that
Fritz Knaak, City Attorney, has reviewed this agreement.
APPROVED ARCHITECTURAL AGREEMENT BETWEEN THE CITY OF
FRIDLEY AND KKE ARCHITECTS FOR THE CONSTRUCTION UF A
FRIDLEY LIQUOR WAREHOUSE AT CUB FOODS (I-694 AND UNIVERSITY
AVENUE) (WARD3).
8. MOTION TO APPROVE THE COMMITMENT OF FUNDS FOR THE
UPGRADE OF ELECTION EOUIPMENT IN THE YEAR 2000:
Mr. Burns, City Manager, stated that while the City is planning to purchase new election
equipment in 2001, he was now asking that the purchase now be moved up to 2000. The
decision to purchase early was prompted by Anoka County's recent decision to replace
their voting equipment in time for the year 2000 election. By committing to purchase
now, the City could buy on the same contract as Anoka and Washington Counties at a
local cost of $64,427.25 (previously estimated at $91,000).
Mr. Burns indicated that the equipment has several features that would improve voting
and vote tallying efficiency. Mr. Burns recommended that the City purchase the
equipment outright rather than participating in the Counties' loan/purchase agreement.
APPROVED THE COMMITMENT OF FUNDS FOR THE UPGRADE OF
ELECTION EQUIPMENT IN THE YEAR 2000.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 6
9. ESTABLISH A PUBLIC HEARING FOR JULY 12 1999 TO DISCUSS
PROPOSED CHAPTER 409 TO THE FRIDLEY CITY CODE ESTABLISHING
FRANCHISE FEES FOR ELECTRIC AND GAS UTILITIES•
Mr. Burns, City Manager, stated that in May, Council approved two new franchise .
agreements with Minnegasco and Northern States Power (NSP). Both agreements
provide for implementation of franchise fees through the establishment of a franchise fee
ordinance. Staff recommended that Council consider a franchise fee ordinance and that it
hold the public hearing for this ordinance on July 12, 1999.
ESTABLISHED A PUBLIC HEARING �'OR JtiLY 12, 1999, TO DISCUSS
PROPOSED CHAPTER 409 TO THE FRIDLEY CITY CODE ESTABLISHING
FRANCHISE FEES FOR ELECTRIC AND GAS UTILITIES.
10. APPOINTMENT OF A CITY E1�iPLOYEE:
Mr. Burns, City Manager, stated that the City hired an Interpretive Specialist for
Springbrook Nature Center and promoted a Community Service Officer to the CSO
Coordinator position in the Police Department.
Peter Cleary was hired as Interpretive Specialist. He has a Bachelor's Degree in Natural
Science from St. John's University and has completed graduate work in Science
Education at Ohio State University. He has worked for the last five years as a naturalist
and interpretive specialist at the Dodge Nature Center in West St. Paul. Prior to his West
St. Paul experience, Peter taught physics at Deering High School in Portland, Maine. If
approved by Council, Peter will begin work for Fridley on June 21,1999.
Brian Owens has been a part-time CSO with the City since May, 1998. Prior to that he
was a Police Explorer, a firearms safety instructor and has worked for a number of private
sector employers while pursuing his police career. .
APPOINTED PETER CLEARY AS INTERPRETIVE SPECIALIST AND BRIAN
OWENS AS CSO COORDINATOR.
11. CLAINIS:
APPROVED PAYMENT OF CLAIM NUMBERS 87307 THROUGH 87663.
12. LICENSES:
APPROVED LICENSES AS SUBMITTED AND ON FILE.
13. ESTIMATES:
APPROVED ESTIMATES AS FOLLOWS:
FRIDLEY CITY COUNCIL MEETING OF JUNE 14. 1999 PAGE 7
Newquist & Ekstrum, Chartered
301 Fridley Plaza Office Building
6401 University Avenue N.E.
Fridley, MN 55432
Services Rendered as City Prosecuting
Attorney for the Month of March, 1999 $ 16,381.00
Frederic W. Knaak, Esq.
Holstad and Knaak, P.L.C.
3535 Vadnais Center Drive
St. Paul, MN 55110
Services Rendered as City Attorney
for the Month of May, 1999 $ 5,000.00
Ron Kassa Construction
6005 — 250th East
Elko, NIN 55020
1999 Miscellaneous Concrete Curb and Gutter
and Sidewalk Project No. 322
Estimate No. 2
Park Construction Co.
7900 Beech Street N.E.
Minneapolis, MN 55432-1795
$ 5,265.75
Riverview Heights Area Improvement
Proj ect No. ST. 1999 —1
Estimate No. 2 $60,759.53
No persons in the audience spoke regarding the proposed consent agenda.
Mayor Jorgenson asked if there were any questions of the public for any of the items.
Connie Metcalf, 860 West Moore Lake Drive, asked if any of the money for funding of the
liquor store would come out of the liquor fund or if it would be tax assessed. Councilmember
Billings responded that all of the money would come out of the liquor fund.
Motion by Councilman Barnette to approve the consent agenda omitting Item 6. Seconded by
Councilmember Steve Billings.
UPON A VOICE VOTE, ALL VOTING AYE, MAYOR JORGENSON DECLARED THE
MOTION CARRIED UNANIMOUSLY.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14,1999 PAGE 8
ADOPTION OF AGENDA:
MOTION by Councilmember Bolkcom to amend the agenda to include the addition of Item 6
from the consent agenda immediately after Item 17 on the regular agenda. Seconded by
Councilmember Billings.
UPON A VOICE VOTE, ALL VOTING AYE, MAYOR JORGENSON DECLARED THE
MOTION CARRIED UNANIMOUSLY.
OPEN FORUM VISITORS:
No persons in the audience spoke under this item of business.
PUBLIC HEARINGS:
14. REVIEW OF SPECIAL USE PERMIT, SP #99-01, BY HOLIDAY COMPANIES,
FOR �iOTOR FUEL SALES AND A CAR WASH ESTABLISHMENT AND TO
TERI�IINATE PREVIOUSLY GRANTED SPECIAL USE_ PERMIT. SP #75-28
FOR IVIOTOR FUEL SALES GENERALLY LOCATED AT 5695 HACKMANN
AVENUE (WARD 21:
MOTION by Councilmember Barnette to waive the reading and open the public hearing at
8:20 p.m. Seconded by Councilmember Wolfe.
UPON A VOICE VOTE, ALL MEMBERS VO�ING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
Mr. Hickok, Planning Coordinator, explained that the purpose of this public hearing was to
review a special use permit request for Holiday Stationstore at Highway 65 and Hackmann
Avenue. He explained that on May 10, 1999, the City Council approved a special use permit for
the site. Subsequent to that approval, an error was discovered in the zoning designation on the
site as a 1976 rezoning changed only a portion of the southernmost lot's zoning designation. The
northern 165 feet is zoned C-2, while the southern 125 feet is zoned C-l. Mr. Hickok noted that
a special use permit for gas sales is allowed in both the C-1 and C-2 districts. A car wash,
however, requires a C-2 zone and a special use permit. Since the May 10 Council action, the
petitioner has agreed to eliminate the care wash at this site.
Mr. Hickok presented a brief history of the site along with a map depicting the site location. A
revised copy of the site plan was also presented. He noted that staff recommended that Council
approve Special Use Permit SP #99-01 with a list of modified stipulations, and that they
terminate Special Use Permit SP #75-28. Additionally, staff recommended that the three
stipulations which were included in Special Use Permit SP #75-28 be included as part of Special
Use Permit SP #99-01. (This was acceptable to the petitioner, provided modifications are made
to state that the annual review of the special use permit would be by staff as is typical with other
special use permits.) Mr. Hickok noted that all stipulations, which appeared as part of the special
use permit previously regarding the car wash have been eliminated.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 9
Councilmember Billings asked how many fuel dispensing pumps are on the site as part of
Special Use Permit SP #75-28. Mr. Hickok noted that there were four stations with two pumps
at each. The new site plan includes the same number of pumps.
Mayor Jorgenson asked if the building would be the same as the original plans except for the
elimination of the car wash. Mr. Holscher responded that it would.
Mr. LeRoy Oquist, 1011 Hackmann Circle, stated that he, along with many other residents of the
neighborhood, had several concerns regarding this proposed development. Staff noted that no
additional gas pumps were proposed for the site; however, the full convenience store would also
generate traffic. Residents in the area had concerns about what affects this would have on their
immediate neighborhood, which is primarily a residential area. Another concern Mr. Oquist had
was with regard to safety. With the location being so close to Moore Lake, he was concerned
that pedestrians might cross Central Avenue to get to the convenience store.
Mr. Oquist stated that residents would like to clean up the corridors in Fridley. This location is a
gateway to Fridley, and he did not feel a large service station/convenience store was the type of
development that the public wanted to see when they enter the City. He felt that staff should take
a closer look at the Comprehensive Plan to see if this type of development fits into what the City
wants for the area. He asked that Council deny Special Use Permit SP #99-01 at this time.
Mr. Hickok noted that staff realized that the Comprehensive Plan was dated in certain areas;
however, what remained consistent was that the zoning along the corridors was commercial
zoning. The location of the site, though tucked into a predominantly residential area, was still
located on the corridor and was zoned commercial. A discussion followed with regard to the
impact the development could have on the traffic generated in the area. Mr. Hickok noted that,
based on a national study, traffic engineers have been able to obtain information as to how many
trips into and out of the site could be expected for this type of use. The numbers, which were
provided, were also supported by the City's consultants.
Ms. Gloria Gilstad, 930 Hackmann Avenue., stated that her property was adjacent to the Citco
Station. She stated that they have had no problems with this business, as their hours of operation
have been such that it has not affected the neighborhood. The stop sign as proposed would be
directly in front of her window. She noted that they have always had problems getting out of
their driveway. If a stop sign was installed in front of her home, she felt the problem would only
increase. She felt Council should consider the traffic issues and concerns of Hackmann Avenue
before making any decisions regarding to the Holiday Station. The additional traffic generated
by this proposed development would only make a difficult situation worst. She noted that she
was also concerned about the lighting and the increase in noise. The fence proposed for the site
was not high enough to block out the lighting over the pumps. Furthermore, she felt that the
written agreement whereby the hours of operation would be from 5:00 a.m. to 12:00 midnight
should remain in effect indefinitely, not merely as long as they remain in their home.
Mr. Buzz Vennewitz, 1232 Hathaway Lane, stated that as a resident since 1973, he had alway�
experienced problems getting onto Old Central Avenue to get onto Highway 65. He felt that any
increase in traffic would only nullify the improvements made to the intersection. He was also
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 10
concerned about safety when taking a left-hand turn onto Hathaway Lane from Old Central
Avenue. He stated that he found it difficult to believe that Holiday would come in with a
proposal for a convenience store unless they anticipated a large increase in traffic.
Ms. Valerie Rolstad, 1100 Lynde Drive, stated that she came to speak on behalf of a friend who
resides in the area. She felt that by approving this special use permit, it would be sacrificing the
safety and respect of the residents of Fridley for this development.
Mr. Jim Nevison, 5720 Polk Street, stated that he felt the only one who would benefit from this
development was Holiday.
Mr. Tim Dunn, 5866 Hackman Avenue, stated that he was also concerned about the safety of
children in the area.
Ms. Ann Williams, 5760 Hackmann Avenue, stated that her property was also located very close
to the proposed stop sign. She anticipated that she would also experience problems getting out of
her driveway. She asked why access could not be provided off of Highway 65.
Mayor Jorgenson stated that the second access, which was originally proposed, was removed due
to safety concerns expressed by the state highway department.
Ms. Carolyn Thompson, 960 Hackmann Circle, stated that she was also concerned about the
traffic and safety issues which have been addressed. She felt that Hackmann Avenue would be
used as a secondary route when exiting the station and that the children in the residential areas
would be put at risk by the increase in traffic.
Ms. Mary Fridley, 970 Hackmann Circle, stated that she has witnessed a traffic problem on
Hackmann Avenue and felt the increase in traffic generated by this proposal would only increase
the problems.
Ms. Ellen Farber, 1041 Hathaway Lane, stated that there are currently two in-home daycare
facilities on Hathaway Lane. The last thing that was needed in the area would be an increase in
traffic.
Mr. Tom Ruwart, 5037 Hackmann Avenue, asked if Council approved this item earlier. Mayor
Jorgenson explained that it was originally approved; however, due to a problem with zoning the
car wash was not allowed on a portion of the site. Therefore, Councilmember Billings requested
that this item be reconsidered so that an additional stipulation could be added. Council voted to
table action on the item at that time to allow staff time to obtain additional information.
Mr. Ruwart stated that he did not feel the proposed development fit into the area. He asked if
speed bumps could be installed on Hackmann Avenue to help slow down the traffic in the area.
He also asked about the possibility of constructing a pedestrian bridge to address the safety
issues raised by residents.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 11
Mayor Jorgenson stated that the City has never installed speed bumps on public roadways, as
they would be a problem in the winter during snowplowing.
Mr. Dan Kerner, 5794 Hackmann Avenue, stated that he believed the intersection, as proposed,
would be a headache to all police officers in Fridley. The old intersection has always been a
problem, but the new intersection with the loop would be a bigger problem.
Ms. Julie Moore, 5753 Old Central Avenue, stated that she opposed the redevelopment of this
site for all the same reasons voiced earlier by her neighbors.
Mr. Hickok stated that a petition was received at the May 24, 1999 City Council meeting, which
addressed a number of issues. Fifty-two residents signed the petition. Residents signed the
petition for speed bumps; stop signs at specific locations, and to not put in a business which
would increase traffic in the neighborhood. Mr. Hickok provided information as to the number
of residents signing various portions of the petition.
Ms. Thea Langseth, 1096 Hackmann Circle, stated that the clientele that goes into the service
station/store would be entirely different if the Holiday Store goes in than what goes in there now.
One resident noted that if the petition had been circulated along Hathaway Lane, or in some of
the surrounding areas, there would have been a lot more signatures.
With no further comments, there was a MOTION by Councilmember Wolfe to close the public
hearing at 10:00 p.m. Seconded by Councilmember Billings.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
15. REZONING REOUEST, ZOA #99-02, BY THE CITY OF FRIDLEY, TO
REZONE A PARCEL FROM R-2, TWO FAMILY ZONINGLTO R-3, GNERAL
MULTIPLE UNITS ZONING GENERALLY LOCATED AT 7411 UNIVERSITY
AVENUE N.E. (WARD 1):
MOTION by Councilmember Billings to waive the reading and open the public hearing at
10:00 p.m. Seconded by Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
Mr. Paul Bolin, Planner, stated that this rezoning request was for property located at 7411
University Avenue. The request is to change it from an R-2 District (single family and two
family dwellings) to an R-3 District (single family, two family and apartment buildings, and
owner occupied condominiums). Staff requested that this rezoning be approved to correct an
error in the zoning maps which has existed since 1986 and inconectly show as an R-3 district on
the map. This would also help the City conform to the settlement of a lawsuit, which was
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 12
brought about by Mr. Ed Chies in 1970 and would allow for multiple family development
including owner-occupied townhomes to be constructed on the site.
Mr. Bolin presented a map depicting the location of the site. He provided a brief history of the
property. At the June 2, 1999 Planning Commission meeting, the Planning Commission
unanimously recommended approval of the proposed rezoning request.
There were no question or comments from the Council or from the public.
MOTION by Councilmember Billings to close the public hearing. Seconded by Councilmember
Bolkcom. The public hearing was closed at 10:07 p.m.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, ACTING MAYOR
BARNETTE DECLARED THE MOTION CARRIED UNANIMOUSLY.
OLD BUSINESS:
16. VARIANCE REOUEST, VAR #99-05, BY TIMOTAY JAWOR. TO REDUCE
THE REQUIRED REAR YARD SETBACK FROM 40 FEET TO 19.2 FEET TO
ALLOW THE CONSTRUCTION OF A SEVEN-UNIT TOWNHOME
STRUCTURE GENERALLY LOCATED AT 7411 UNIVERSITY AVENUE N.E.
�WARD 1Z(TABLED MAY 24, 1999):
Mr. Bolin, Planner, explained that the petitioner, Timothy Jawor, was seeking a variance to
decrease the rear yard setback frorri 40 feet to 19.2 feet to allow for the construction of a seven-
unit owner-occupied townhome complex at 7411 University Avenue. Mr. Jawor was also
seeking a re-plat to allow the construction of the structure. With the re-plat request, Mr. Jawor
was also seeking to create eight lots, seven lots — one for each individual unit, and the eighth lot
would be the remainder of the parcel.
Mr. Bolin stated that City Code requires a minimum rear yard setback of 40 feet for a lot of this
size.
Mr. Bolin provided a brief history of the property. He noted that in 1994 there was a proposal
for a seven-unit rental condominium project on the site. The former project would have
complied with all of the setback requirements; however the former project was withdrawn. Most
recently, the City received a variance and replat request from Mr. Jawor fcr the current proposal.
Mr. Bolin stated that the petitioner indicated in the hardship statement that a more rectangular lot
of similar square footage would have been desirable for a townhouse project like this. However,
the petitioner felt that he has adapted and designed an attractive building that would nicely fit
this apartment-type lot and at the same time would meet the needs and desires of both the City
and the housing market.
Mr. Bolin presented a diagram of the site showing where the code required setback of 40 feet
would be. He noted that the current setback requirements would not allow the petitioner to get
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 13
the seven units on the property. Even reducing the number of units to six at the proposed size, a
variance would be required of approximately one foot.
Mr. Bolin noted that the law defines an undue hardship as: 1) The property cannot be put to
reasonable use if used under the requirements of the code; 2) The need for the variance is due to
the conditions unique to the property and not created by actions of the landowner; 3) The
variance, if granted, will not alter the character o€the neighborhood.
Mr. Bolin noted that on April 28, 1999, the Appeals Commission held a public hearing on the
variance request. After discussion, a motion was made and seconded to recommend approval of
the variance with eleven stipulations, and the motion was passed unanimously. At the May 24,
1999 City Council meeting, the request for the variance and replat were tabled and the sixty-day
timeframe was extended to give the petitioner an opportunity to re-evaluate the proposal: After
re-evaluating the proposal, the petitioner met with staff on June 2, 1999 and indicated that he had
chosen to proceed with the original variance request. The petitioner indicated that he had looked
at other options, but this one appeared to be most feasible to him. Staff still recommended denial
of the variance request and the replat request. Mr. Bolin noted that staff found no comparable
variances granted. The request does not meet the hardship definition, and it is possible to
develop the site without a variance.
Mr. Lynn Hansen, 230 Rice Creek Boulevard, stated that he owns property directly to the north
of this property. He noted that the property was currently vacant. The property has become a
"dumping ground." He has been attempting to clean it up for years. He felt it would be in the
City's best interest to approve this development, as it would improve the area.
Mr. Timothy Jawor, 9175 107`'' Street North, stated that his project does not have the
neighborhood opposition that was voiced for the Holiday Station proposed in Fridley. The
neighbors to the north of this proposed project are in support of it. Mr. Jawor stated that since
the last City Council meeting he met with his designer. His engineers to tried to configure a
project that would work for this area. The problems he had in drawing a plan to fit this lot'was
due partially to the configuration of the lot. They have tried turning the building several different
ways; however, in order to get the drive aisles in and the parking areas in; a variance will be
required.
Councilmember Billings stated that some of the calculations that Mr. Jawor prepared were for an
apartment analysis and a single-family analysis. The single-family analysis indicates that the
cost of the land plus the development cost is approximately $100,000 which would require that a
$500,000 home be built on the site. He noted that if a lot was purchased for $40,000 with City
sewer and water, using Mr. Jawor's ratio, an additional $160,000 could be spent on materials and
profit, and it could still be sold at a reasonable profit. Mr. Jawor responded in the affirmative.
Councilmember Billings then asked why Mr. Jawor felt a five to one ratio needed to be
maintained. He felt that Mr. Jawor's single family analysis was flawed.
Mr. Jawor stated that the ratio was obtained by his attorney, who was a real estate appraiser for
fifteen years. This ratio was used to demonstrate why a single-family house would not be
appropriate for that particular property.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 14
Councilmember Billings stated that Mr. Jawor's analysis of variance requests was very well
done. He asked how many of these residential variances were in R-1, R-2 and R-3 districts.
Mr. Jawor stated that he did not have that information.
Councilmember Bolkcom asked if the City has ever granted any similar variance. Mr. Hickok
stated there had not.
Councilmember Billings referred to Page 3, paragraph 3 of the letter from the petitioner's
attorney, Karen Cohl, (Kennedy & Graven), wherein she stated "thus no alternative use for the
property is available.". He asked if she was saying, in essence, that if this variance were not
granted, nothing would ever be built on that property, as there was no alternative use for that
property?
Ms. Cohl said her statement was based on the calculations that Mr. Jawor provided.
Councilmember Billings referred to Page 6, wherein Ms. Cohl refers to the soil conditions and
terrain at the site. He asked if she was referring to the dumping of material on the site by
previous owners. Ms. Cohl stated that she was referring to uneven terrain of the site, which
would require correction and; therefore, additional cost to the developer. It also refened to
materials that have been dumped on the site, which would need to be removed and replaced with
clean fill. Councilmember Billings stated that he felt these were economic costs, which should
be taken into consideration when negotiating the price of the property. Ms. Cohl stated that she
did not feel it was inappropriate to consider economic situations. The State Statutes allow a
person to do so.
Councilmember Billings stated that her letter draws the conclusion that the soil conditions are a
non-economic factor. He questioned how it could be considered such. She stated that it was a
non-economic factor due to the conditions of the site. There was not a reasonable use for the
property and given this, the state statute allows for it.
Councilmember Billings referred to Ms. Cohl's statement regarding the shape of the parcel. The
parcel was suited for multi-family apartment buildings which are no longer feasible. He stated
that he was assuming that she was saying that in the metropolitan area there are no apartment
buildings built on lots of approximately the same size. Ms. Cohl stated that she was not
indicating this. She said she was merely stating that this parcel must be looked at in the context
of having two apartment buildings next to it. Therefore, what can go on the site was limited. It
was not just the size and shape of the site but also what was on the sites around it.
Mr. Jawor stated that he did not complete the aparhnent analysis. He obtained three different
opinions from developers/rental owners. All of them stated they would not build an apartment
building on the site, as the economics would not allow it.
Councilmember Billings asked if the drainage issue was not, in fact, an economic issue that
should be taken into account when negotiating the price of the property. Mr. Jawor stated that all
of this was taken into consideration, and it was part of the development cost that would need to
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 15
be absorbed no matter how many units are put on the site. The cost of the land may have been
lower to compensate for that, but then the development costs are higher.
Councilmember Billings noted that Mr. Jawor was looking at a maximum price of $115,000. In
a conversation Councilmember Billings had with Mr. Miller (Mr. Jawor's partner), Mr. Miller
indicated that if the development were to be decreased to six units, they would have to increase
the selling price to between $150,000 and $160,000. Assuming the costs would be the same,
Councilmember Billings stated that he could not arrive at the same calculation. Mr. Jawor stated
that the realtor who completed the market analysis for them found that the highest base price in
the areas he used was approximately $115,000 per unit. If one unit would be eliminated, (fifteen
percent (15%) of the total units), that fifteen percent (15%) cost would need to be spread out
amongst the other six units which would likely increase the cost of the units by $10,000 to
$15,000 per unit, putting the price in the $125,000 to $130,000 range which he did not feel the
market would support.
Mr. Jawor presented photographs of some of his other similar developments.
Councilmember Bolkcom asked how much of a variance would be required if the development
were reduced to six units. Mr. Bolin stated that it would require approximately a one-foot
variance. If all of the units were the same size as the end unit, it would require approximately at
two to two and one-half foot variance.
There were no further questions or comments.
MOTION by Councilmember Billings to deny Variance Request #99-05, by Timothy Jawor.
Seconded by Councilmember Bolkcom. Councilmember Billings based the motion on a failure
by the applicant to establish any non-economic basis for the hardship and a failure to show an
absence of other economical uses �of the property. The evidence on the record before the council
and the Appeals Commission plainly showed the only reasons being advanced for the variance
had to do with the greater profitability of the proposed development on the lot with the requested
variance and that other configurations were both possible and viable that involved no, or much
smaller, variances.
Councilmember Barnette stated that he could not support the motion to deny this variance for the
following reasons: 1) Much has been said about the reason for Mr. Jawor requesting the variance
is only financial. According to the City Attorney, financial considerations only are not sufficient
to approve a variance. Mr. Jawor expressed numerous other reasons — lot configuration, soil
conditions, etc. Mr. Jawor and his partner admitted that financial and economic concerns are one
of the reasons; however, he felt that the seventh unit would allow them to make a reasonable
return on their investment. Much has been said about concern in setting a precedent. He felt that
every variance approval sets precedence. He refened to a situation where a sign variance was
requested because the location of the building was such that it was off a main thoroughfare and
the petitioner did not have the exposure that they felt was necessary. This situation,
Councilmember Barnette felt was purely economical. He voted in favor of the variance request,
as he felt it made good common sense. Staff recommended not to approve that same variance
request. He does not fault staff but realizes that the discretion is left up to Council.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14. 1999 PAGE 16
Councilmember Barnette continued with reasons why he voted to deny this variance: 2) The
Appeals Commission and Planning Commission voted unanimously to approve the variance with
little or no discussion; 3) Both members of the Appeals Commission and Planning Commission
were complimentary that the site plan itself. All felt it would be an asset to the neighborhood.
He had concerns that this site would sit vacant for many more years if there was no liable
financial reason to build upon the site. 4) Most comments from the Councilmembers and staff
indicated that the plan was acceptable except for the need of the variance. It met the needs of the
City's Comprehensive Plan by providing affordable new housing and met the City's desire for
owner-occupied homes. Recently, a front yard setback was approved for a home in Ward 3.
There were no objections from surrounding property owners in that case. There have been no
objections to the variance request from the surrounding neighbors in this case.
Councilmember Barnette continued with reason why he voted to deny this variance: 5) Several
other concerns have been raised — one being that there is no playground in the immediate
vicinity. This was no fault of the developer. Whether this project or any other project goes on
the site, that concern will exist. 6) A concern raised by the Appeals Commission was with regard
to the traffic concerns, especially at 73`� Avenue and Symphony Street, yet any development
would create more traffic. It would not take long for new people to figure out how to get out of
the neighborhood. Mr. Jawor has been asked many times to change his plat to six units. He has
been unable to do so and claims the only way it would work financially is to put in seven units.
Councilmember Barnette stated that when he ran for City Council he was very much concerned
about the future and image of Fridley. He still was. This request by Mr. Jawor was a good plan
for the lot, as it would make the City look better and would increase the tax base. It created
affordable housing. Council was charged, as elected officials to make decisions, though often
not all of them agree. However, he was thankful for democracy.
Councilmember Billings stated that he did not feel the petitioner demonstrated that there was no
other reasonable use for the land. He agreed with the petitioner that the type of project he wished
to build may have required seven units in order to be a reasonable use of the land. However, he
felt there were other reasonable uses for the land that did not require variances. He did not feel
the land would remain vacant forever. In this instance, Councilmember Billings stated that he
felt Mr. Jawor was attempting to "build seven pounds of building on a six pound lot."
Councilmember Wolfe stated that he felt the project would be a great improvement to the area.
He had not heard one opposition from the neighbors.
Councilmember Bolkcom noted that the reason for setbacks was to provide as much green space
as possible.
Mayor Jorgenson stated that she had serious concerns about approving this request for a setback
variance based on the absence of non-economic criteria, and what that would mean in terms of
setting a precedent for enforcement in the future.
UPON A VOICE VOTE, THREE MEMBERS VOTING AYE AND TWO VOTING NAY
(COUNCILMEMBERS BARNETTE AND WOLFE), MAYOR JORGENSON
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 17
DECLARED THE MOTION CARRIED AND VARINACE REQUEST #99-0-5 WAS
DENIED.
17. PLAT REQUEST, P S #99-02. BY TIMOTHY JAWOR. TO CREATE EIGHT
SEPARATE LOTS IN ORDER TO CONSTRUCT A SEVEN-UNIT TOWNHOME
STRUCTURE GENERALLY LOCATED AT 7411 UNIVERSITY AVENUE N.E.
�VARD 1)(TABLED MAY 24.19991:
MOTION by Councilmember Billings to deny Variance Request, P.S. #99-02. Seconded by
Councilmember Bolkcom.
UPON A VOICE VOTE, THREE MEMBERS VOTING AYE AND TWO MEMBERS
VOTING NAY (COUNCILMEMBERS BARNETTE AND WOLFE), MAYOR
JORGENSON DECLARED THE MOTION CARRIED (PLAT REQUEST P.S. #99-02
DENIED).
6. APPROVE LEASE BETWEEN THE CITY OF FRIDLEY AND LYNDALE
TERMINAL COMPANY FOR THE FRIDLEY LIQUOR WAREHOUSE STORE
�WARD 3):
Mayor Jorgenson stated that on any given Friday or Saturday evening she has witnessed up to 45
vehicles parked in the lot that would be part of the space leased for the Fridley Liquor Store. She
believed the vehicles are from Cattle Company customers. She wondered if there was a parking
agreement between Cattle Company and Lyndale Terminal Company for that section of the
parking lot.
Mr. Holscher stated that he believed there was a cross parking agreement. Concern was
expressed by Councilmembers as to how this could affect the parking for patrons of the Fridley
Liquor Store.
MOTION by Councilmember Bolkcom to table action on the lease agreement between the City
of Fridley and Lyndale Terminal Company for the Fridley Liquor Warehouse Store until the
June 28, 1999 City Council Meeting to allow staff to obtain additional information. Seconded by
Councilmember Barnette.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
NEW BUSINESS:
18. FIRST READING OF AN ORDINANCE TO AMEND THE CITY CODE OF THE
CITY OF FRIDLEY MINNESOTA BY MAKING A CHANGE IN ZOIVING
DISTRICTS (REZONING REOUEST, ZOA #99-02, BY THE CITY OF FRIDLEY.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14,1999 PAGE 18
FOR PROPERTY GENERALLY LOCATED AT 7411 UNIVERSITY AVENUE
N.E.�(WARD 1Z
MOTION by Councilmember Billings to Approve the First Reading of an Ordinance to Amend
the City Code of the City of Fridley, Minnesota, by making a Change in Zoning Districts
(Rezoning Request, ZOA #99-02, by the City of Fridley, for Property Generally Located at 7411
University Avenue N.E.). Seconded by Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
19. APPROVE SPECIAL USE PERMIT, SP #99-01. BY HOLIDAY COMPArTIES AN
DTERMINATE PREVIOUSLY GRANTED SPECIAL USE PERMIT SP #75-28
FOR MOTOR FUEL SALES, GENERALLY LOCATED AT 5695 HACKMANN
AVENUE (WARD 2Z
MOTION by Councilmember Wolfe to deny Special Use Permit, SP #99-01, by Holiday
Companies. Seconded by Councilmember Billings.
Councilmember Wolfe stated that he believed it was apparent that this was not what the
neighborhood wants for the area. He believed that if the petition were distributed further
evidence would have shown tl�at there would have been e�en more opposed to the development
than those present at the meetings. As a Councilmember, he felt it was his obligation to back his
constituents. Therefore, he was voting to deny the special use permit request.
Mayor Jorgenson stated that she agreed with the neighbors that there are some traffic issues
which may be partially due to the configuration of the intersection. However, the engineers did
the best that they could with what they had to work with. She knew what the neighbors wanted
for the site, but she also realized that a project could not be denied for those reasons. Therefore,
as difficult as it was for her, she would not be voting in favor of Councilmember Wolfe's motion
to deny this special use permit.
Councilmember Billings stated that if Council were merely looking at a convenience store for
this site, no special use permit would be required at all. The special use permit was for the motor
fueling. The number of pumps was not increasing from what was already there. He did not feel
that the total number of vehicle trips, 84 per day entering and exiting, was substantial enough of
an increase to be a burden. The petitioner was entitled to reasonable use of the property. As
much as Council would like to consider the emotional impact that it may have on the
neighborhood, it was not something that the law allows them to do. :
UPON A VOICE VOTE, ONE MEMBER VOTING AYE (WOLFE) AND FOUR
MEMBERS VOTING NAY, MAYOR JORGENSON DECLARED THE MOTION
FAILED.
MOTION by Councilmember Billings to approve Special Use Permit, SP #99-01, for Motor Fuel
Sales by Holiday Companies with the following stipulations: 1) The soils on the property will be
FRIDLEY CITY COUNCIL MEETING OF JUNE 14,1999 PAGE 19
tested (weather permitting) by May 1, to make a final determination on the presence or absence
of non-exempt wetlands. Testing will be completed by the City's environmental consultant at
the petitioner's expense. If it is determined that non-exempt wetlands exist on the property, this
special use permit shall become null and void. No site alterations shall occur until a final
determination on wetland status; 2) The petitioner shall be responsible for litter control on the
premises, and litter control is to occur on a daily basis. Trash receptacles must be provided on
site at convenient locations to facilitate litter control; 3) Parking lot must be lined with a concrete
curb; 4) Adequate parking to meet code requirements, including one handicap space, be provided
on-site; 5) No off-site employee parking allowed along Hackmann Avenue or the service road; 6)
Final drainage, landscaping, and irrigation plans shall be submitted with building permit
application; 7) Petitioner shall execute a storm pond maintenance agreement, requiring petitioner
to maintain the storm pond; 8) Canopy over gas pumps to have recessed, shielded, downcast
lighting so as to be less intrusive on neighboring properties and canopy faces shall not be
internally lit; 9) Car wash hours of operation shall be limited to 6:00 AM to 11:00 PM; 10) Tanks
and ventilation shall be located so as to limit gasoline fumes off premises. Tank and vent
location to be approved by staff prior to issuance of a building permit; 11) Petitioner shall install
adequate informational signage on-site to assure proper flow of traffic round the building and to
assure that cars waiting to be washed to not block access from roadways; 12) Intercom volume
shall be set so intercom messages do not cany beyond Stationstore property; 13) Informational
signage shall be placed on-site reminding Holiday customers that they are in a residential area
and requesting they keep radios turned down so impact does not carry onto neighboring
properties; 14) Petitioner shall install all waste trap and filtration devices as required by the
Building Code for car wash facilities; 15) The petitioner shall comply with all outdoor sales and
storage provisi8ons of Chapter 205 of the City Code; 16) The petitioner shall comply with all
outdoor storage requirements; 17) The petitioner shall install underground irrigation for the
landscape areas surrounding the station store; 18) All signs shall be reviewed by staff to assure
compliance with Chapter 214 of the City Code; 19) All building elevations shall be reviewed by
staff to ensure the design and materials used shall architecturally integrate with the surrounding
neighborhoods; 20) The existing fence along the east property line shall be replaced with a
residential type fence, to be approved by staff prior to issuance of a building permit.
MOTION by Councilmember Billings to AMEND the stipulations by striking the following four:
Stipulation Nos. 1, 9, 11 and 14 and renumbering accordingly and to add the following
stipulation (numbered accordingly): "Upon adoption of Special Use Permit #99-01, Special Use
Permit #75-28 shall terminate and become null and void along with all stipulations adopted on
April 8, 1976.
Further, to amend Stipulation currently numbered 20, by striking the words "the existing fence"
and inserting the following "A fence along the south and", to strike the word "replaced" and
insert "constructed" (read as follows: A fence along the south and east property long shall be
constructed with a residential type fence, to be approved by staff prior to issuance of a building
permit).
Mayor Jorgenson stated that she has some concerns about the accessibility of the vehicles
coming onto the property.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 20
Vote on Amendments: UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR
JORGENSON DECLARED THE MOTION CARRIED UNANIMOUSLY.
MOTION by Councilmember Barnette to add a Stipulation as follows: "All turnarounds by
delivery vehicles of any kind at the site shall be accommodated entirely on the site. Any such
vehicles shall avoid to the extent possible use of any residential streets, including but not limited
to Polk Street and Lynde Drive." Seconded by Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UANIMOUSLY.
Vote on Main Motion: UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR
JORGENSON DECLARED THE MOTION CARRIED UNANIMOUSLY.
Mayor Jorgenson asked the petitioner if it was clearly understood that as long as Mr. and Mrs.
Gilstad remain at their property, the convenience store would not remain operr 24 hours per day.
Mr. Holscher stated that was correct.
20. MOTION GRANTING PRELIMINARY APPROVAL OF AN AMENDMENT TO
THE 1999 — Z000 LICENSE FOR CASH-N-PAWN FOR THE RELOCATION OF
THE BUSINESS TO 57T" AVENUE AND MAJN STREET (WARD 3Z
MOTION by Councilmember Bolkcom to remove this motion from the agenda, per advice from
Attorney Knaak. Seconded by Councilmember Barnette.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
21. APPOINTMENTS TO THE CABLE TELEVISION AND TELE-
COMMUNICATIONS ADVISORY COMMISSION:
MOTION by Councilmember Billings to table this item. Seconded by Councilmember
Bolkcom.
Mayor Jorgenson stated that with the RFP coming forward, she wanted this item taken care of.
Councilmember Billings stated he understood that the RFP would be reviewed by a panel, but
was not sure that it would be brought back befare the Cab1e Commission.
UPON A VOICE VOTE, FOUR MEMBERS VOTING AYE AND ONE MEMBER
VOTING NAY (MAYOR JORGENSOI�, MAYOR JORGENSON DECLARED THE
MOTION CARRIED.
FRIDLEY CITY COUNCIL MEETING OF JUNE 14 1999 PAGE 21
21. INFORMAL STATUS REPORTS:
Mayor Jorgenson reminded residents of the Fridley `49er Day Parade which will be held on
Thursday evening as well as the carnival.
ADJOURNNIENT:
MOTION by Councilmember Barnette to adjourn the meeting at 11:55 p.m. Seconded by
Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED AND THE JUNE 14, 1999 MEETING OF THE
CITY COUNCIL WAS OFFICIALLY ADJOURNED AT 11:55 P.M.
Respectfully submitted,
Tammy Saefke
Recording Secretary
Nancy J. Jorgenson
Mayor
d
,
' .,
THE MINUTES OF THE FRIDLEY CITY COUNCIL MEE'I'ING OF
JUNE 28,1999
,
-
THE MINUTES OF THE REGULAR MEETING OF THE FRIDLEY CITY COUNCIL
OF JLJNE 28. 1999
The Regular Meeting of the Fridley City Council was called to order by Mayor Jorgenson at
7:30 p.m.
PLEDGE OF ALLEGIANCE:
Mayor Jorgenson led the Council and audience in the Pledge of Allegiance to the Flag.
ROLL CALL:
MEMBERS PRESENT: Mayor Jorgenson, Councilmember Barnette, Councilmember
Billings, Councilmember Wo1fe, and Councilmember Bolkcom
MEMBERS ABSENT: None
PRESENTATION:
Introduction of Students from Fourmies, France
Mayor Jorgenson introduced Ms. Diane Ferry, Fridley High School French teacher and
coordinator for seventeen students visiting from Fridley's Sister City, Fourmies, France. Mayor
Jorgenson also introduced Mr. Michel Marteau, Fourmies' coordinator.
Ms. Ferry explained how the group was celebrating the 20`� year anniversary of the two cities
being Sister Cities. Mr. Marteau was also visiting on behalf of a student exchange program.
Ms. Ferry introduced each student as Mr. George Arnold, VFW Commander, presented a gift to
each student.
Ms. Ferry also introduced the host families for each of the students.
Mr. Marteau expressed his thanks and gratitude toward the City of Fridley for the opportunity of
the student exchange program.
Mayor Jorgenson thanked all students and families for participating in the program and for
attending the meeting.
APPROVAL OF MINUTES:
Citv Council Meetin,� Minutes of June 14, 1999
The minutes of the City Council meeting of June 14,1999 were not available in vvriting for
approval.
FRIDLEY CITY COUNCIL MINUTES OF JUNE 28. 1999 PAGE 2
APPROVAL OF PROPOSED CONSENT AGENDA:
OLD BUSINESS:
1. ORDINANCE NO. 1129 TO AMEND THE CITY CODE OF THE CITY OF
FRIDLEY, MINNESOTA. BY MAKING A CHANGE IN ZOl�TING DISTRICTS
(REZO�IING REOUEST, ZOA #99-02. BY THE CITY OF FRIDLEY FOR
PROPERTY GENERALLY LOCATED AT 7411 IJNIVERSITY AVENUE N E 1
(WARD 1)
Mr. Burns, City Manager, explained that the property has been zoned R-2 since the early
1960's. A court settlement in 1970 allowed R-3 standards to be applied. This legislation
was essentially a housekeeping item designed to bring the actual zoning into compliance
with the requirements of the court. Staff recommended Council's approval of the second
and fmal reading of this legislation.
WAIVED THE SECOND READING AND ADOPTED ORDINANCE NO. 1129
AND ORDERED PUBLICATION.
NEW BUSINESS:
2. RESOLUTION NO. 41-1999 REQLTESTING EXTENSION OF THE DUE DATE TO
DECE�IBER 31, 1999, FOR REVIEW OF THE CITY OF FRIDLEY'S
COMPREHENSIVE PLAN FOR CONSISTENCY WITH AMENDED
METROPOLITAN COUNCIL POLICY PLANS:
Mr. Burns, City Manager, explained that this resolution asks the Metropolitan Council to
give us until the end of 1999 to submit our Comprehensive Plan amendments. Staff
recommended Council's approval.
ADOPTED RESOLiJTION NO. 41-1999.
3. RESOLUTION NO. 42-1999 APPROVING AN ABATEMENT OF A SPECIAL
ASSESSMENT FOR LANCE AND TONJA KONZE. 6775 EAST RIVER ROAD
(WARD 3)
Mr. Burns, City Manager, explained that this resolution would approve an abatement of a
special assessment for Lance and Tonja Konze. On October 28,1996, the City assessed
the property at 6775 East River Road for costs associated with construction of the Locke
Lake Dam. Mr. Konze paid the balance of the assessment on February 12, 1997. The
City inadvertently assigned the payment to the incorrect parcel number when reporting it
to the County. The resolution abates the taxes and enables the Konzes to get a refund for
FRIDLEY CITY COUNCIL MINUTES OF JUNE 28 1999 PAGE 3
taxes they paid in 1998 and 1999. On behalf of the City, Mr. Burns apologized to the
Konzes for the error and recommend approval of this resolution.
ADOPTED RESOLiJTION NO. 42-1999.
4. RESOLUTION NO. 43-1999 AUTHORIZING CHANGES IN APPROPRIATIONS
FOR THE GENERAL FUND SPECIAL REVENLJE FUNDS AN� CAPTIAL
IMPROVEMENT FL1ND FOR THE FOURTH QUARTER OF 1998:
Mr. Burns, City Manager, explained that this resolution-would authorize changes in
appropriations for various City funds. The adjustments are for the fmal quarter of 1998.
They are for the General Fund, the Special Revenue Funds and the Capital Improvements
Fund. The changes reflect unforeseen expenditures and revenues, including donations.
Staff recommended Council approval of the adjustment contained on pages ten through
twelve of the agenda book.
ADOPTED RESOLUTION NO. 43-1999.
5, RESOLUTION NO. 44-1999 PROVIDING FOR THE ISSUANCE AND SALE OF
SEIVIOR HOUSING REVENUE B4NDS TO PROVIDE FUNDS FOR A SEIVIOR
HOUSING PROJECT ON BEHALF OF MINNESOTA CHRISTIAN HOMES OF
FRIDLEY. INC.:
Mr. Burns, City Manager, explained that the City was asked to be a conduit for the
issuance of $9,700,000 in senior housing revenue bonds. The bonds are for the "Banfill
Crossing Homes Project," formerly known as Noah's Ark. A public hearing on the
fmancing was held July 14, 1997. At that time, it was stated that the City would have no
financial responsibility for the repayment of these bonds. The City would also be
compensated by the project for costs of bond counsel and any other costs incuned in
issuing these bonds. Since the matter has been reviewed and approved by the City
Attorney and since this project provides 110 units of badly needed senior housing in
Fridley, staff recommended Council's approval of this bond issue.
ADOPTED RESOLUTION NO. 43-1999.
6. MOTION TO APPROVE THE PURCHASE OF TWO GENERATORS (FOR 73 1/2
AVENUE FILTER PLANT AND 53RD AVENUE BOOSTER STATIO :
/`►117
FRIDLEY CITY COUNCIL MINUTES OF JUNE 28 1999 PAGE 4
RESOLUTION NO: 45-1999 AUTHORIZING CHANGES IN APPROPRIATIONS
FOR THE GENERAL FLTND AND THE CAPITAL IMPROVEMENT FUND:
Mr. Burns, City Manager, explained that there were several unbudgeted expenditures in
preparation for the year 2000 (Y2K). Earlier this year, Council was requested to approve
the purchase of six generators for the sewage lift stations at a cost of $33,000. At the
present time, Council was being asked to approve the expenditure of $80,450 for
generators that would enable the City to operate the new filter plant and booster station on
Highway 65 and 53rd Avenue, in the event that the City is without power at some future
date. Staff recommended Council's approval of these expenditures.
1�1r. Burns also explained that the City was requesting that Council approve a
supplemental appropriation for the purchase of several other Y2K items. These items
include $19,500 for a generator hookup at the FCC, $3,600 for forty additional stop
signs, and $5,500 for supplemental insurance. The total supplemental appropriation is
$28,600. Staff recommended Council's approval.
7. CLAIMS:
APPROVED PAYMENT OF CLAIM NUMBERS 87664 THItOUGH 87913.
8. LICENSES:
APPROVED LICENSES AS SUBMITTED.
9. ESTIMATES:
Ron Kassa Construction
6005 - 250th Street East
Elko, MN 55020
1999 Miscellaneous Concrete Curb and Gutter
and Sidewalk Project No. 322
Estimate No. 3 ................................................$ 1,414.46
Forest Lake Contracting
14777 Lake Drive
Forest Lake, MN 55025
57th Avenue Reconstruction
Project No. ST. 1997 - 4
FINAL ESTIMATE ..............................$ 58,334.87
�
FRIDLEY CITY COUNCIL MINUTES OF JUNE 28. 1999 PAGE 5
No persons in the audience spoke regarding the proposed consent agenda.
MOTION by Councilmember Barnette to approve the consent agenda items. Seconded by
Councilmember Wolfe.
UPON A VOICE VOTE, ALL VOTING AYE, MAYOR JORGENSON DECLARED THE
MOTION CARRIED UNA1vIMOUSLY.
ADOPTION OF AGENDA:
MOTION made by Councilmember Billings to approve the adoption of the agenda. Seconded by
Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNAIVIMOUSLY.
OPEN FORUM VISITORS:
Mayor Jorgenson invited members of the public to come forward to address any items not on the
agenda.
Mr. Dan Hetman, 230 Craigbrook Way, explained that he was there on behalf of the
neighborhood regarding the seven remaining Pearson-Craig Way Estate signs located at various
boundaries to the neighborhood along East River Road. He presented a petition to save the signs
and summarized the series of events that led to this petition. He stated that 74 out of 76 residents
signed the petition regarding the signs. On June 24 he received a letter from the City signed by
William A. Champa, Management Assistant. The letter stated that not all but several signs in the
area would be removed. The letter stated that Mark Daly from the Anoka County Highway
Department, informed the City that all signs would be removed. That meant all signs that were
not in a construction area would be removed.
Mr. Hetman said he typed a petition that stated the residents wanted either the City or the county
to replace the signs. Mr. Hetman stated that by Thursday June 24 every resident he approached
signed the petition for a total of 36 signatures. That evening Councilmember Bolkcom returned
his telephone call. They discussed the petition, and Councilmember Bolkcom offered to make
some telephone calls. June 25 Mr. Hetman received a letter from the County signed by Mark
Daly. The letter was dated June 23 and stated that tree removal would begin June 21. Mr.
Hetman stated that there were six remaining signs. He stated that the signs are their
neighborhood property and identity. He stated that the majority of residents were never informed
about all of the aspects of this construction. He stated that in the fmal analysis if nothing was
done about the signs what has gone on through this construction project was nothing short of
legalized vandalism conducted by Anoka County and condoned by the City of Fridley. He
thanked Council for their time.
FRIDLEY CITY COUNCIL MINUTES OF JUNE 28. 1999 PAGE 6
MOTION by Mayor Jorgenson to receive the petition given by Mr. Hetzman regarding the signs
in their neighborhood. Seconded by Councilmember Barnette.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNAlVIMOLiSLY.
Councilmember Bolkcom stated that she would like to respond. She stated that she told
Mr. Hetman previously on the telephone that how she found out the signs would be removed was
by jogging in the neighborhood. A woman stopped her and asked her if the signs could be taken
down because she thought they were in disrepair. Councilmember Bolkcom then electronically
mailed a memorandum about the signs that same evening to the City Manager. The City
Manager responded by saying that the County planned to remove most of them because they
were in the right-of-way or would interfere with the construction. Councilmember Bolkcom then
asked the City Manager how much the signs would cost. He responded that they were azound
$1,500 to $2,000, and the County indicated that they would not pay for the signs.
Councilmember Bolkcom stated that she thought since it was a county project with the Minnesota
Department of Transportation coordinating the whole project, the residents should ask the county
to hold a hearing with the county commissioner and coordinate something with Mr. Daly.
Mr. Burns stated that there were seven signs altogether with all of them located on county
property.
Mr. Hetman agreed to be the contact person regarding this issue.
Mayor Jorgenson confumed that Council would begin work on the issue and arrange meetings to
see what they could do.
Ms. Mary Martin, 133 Stonybrook Way, had a question regarding the county land bordering her
boundary. She would like someone to check to see if it is City land or county land.
Councilmember Bolkcom confirmed that Council needed to check on legal issues, where the
signs are, and if they are in the right-of-way.
Mr. Lenny Brandt, 190 Craigbrook Way, said he thought the signs were on private property. He
wanted veriiication of the County's plans regarding legal issues with the signs.
Ms. Karen Engler, 104 Craig Way, said she was unaware that one of the exits to her street would
be closed. She said she would appreciate prior notification. She did not realize that the East
River Road project would include her street.
Mayor Jorgenson stated that the County Commissioner would be contacted the next day.
FRIDLEY CITY COUNCIL MINUTES OF JUNE 28. 1999 PAGE 7
PUBLIC HEARINGS:
10. APPLICATION TO THE DEPARTMENT OF COMNIERCE BY PAWN
AMERICA, L L C. TO OPERATE AS A CURRENCY EXCHANGE COMPANY:
MOTION by Councilmember Biliings to open the public hearing at 8:30 p.m. Seconded by
Councilmember Barnette.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNA1vIMOUSLY AND THE PUBLIC HEARING
WAS OPENED AT 8:30 P.M.
Scott Hickok, Planning Coordinator, explained that this was an information heazing only. He
said that this was a request by Pawn America located at 1031 East Moore Lake Drive to have a
currency exchange operation within the existing facility. According to Minnesota State Statute
53-A.04(a) the City is required to hold a�public hearing. The State would accept all comments
that the City presents as part of the public hearing. Mr. Hickok also noted that it would not be
allowable to deny this request being that this was a use that was not prohibited in the zoning
district where it was proposed so the City could not say the zoning was incorrect. There was no
space expansion. It was within the confines of the building.
Mr. Andy Lee, petitioner, was present to answer any questions the council might have.
Councilmember Billings asked Mr. Lee if the two other names attached to the Articles of
Organization of the Limited Liability Corporation were cunently partners in the operation.
Mr. Lee coniu�med that they were family members and were further down the chain of ownership
but he was not sure of their ownership.
Councilmember Billings had a question regarding specifically who owns what percent of Pawn
America.
Mr. Lee said he was not sure and did not want to misspeak. He said he would follow up on that.
Councilmember Billings stated that due to the sixty-day nature of the State statute there was no
time to follow-up.
Mr. Lee stated that he could submit it in writing tomorrow.
Councilmember Billings stated that it would take time to take action on it in terms of
recommending approval or denial for the state. Councilmember Billings' complaint was with the
State of Minnesota for providing such a sloppy application and expecting Council to.take action
within a certain time period when Council does not have authority to take any action.
FRIDLEY CITY COLTNCIL MINUTES OF JUNE 28, 1999 PAGE 8
Mr. Lee presumed that the application was correct. He did not have it in front of him, so he did
not want to misspeak. He stated that he knew the City reviewed it cazefully.
Mr. Lee stated that he did not have specific information about the exact process of how the check
cashing process would work, but he knew Pawn America held the items for at least two days.
Councilmember Bolkcom stated that the statute only allows for a public hearing with no
jurisdiction.
Mr. Knaak confirmed that the state statute allowed for jurisdiction to hold a public hearing for
verification. He believed that a public hearing was a prerequisite for approval so if you were to
delay the public hearing, in effect you could also delay the approval.
Councilmember Bolkcom asked David Sallman, Public Safety Director, to answer the question of
the issue of safety pertaining to check cashing causing more crime.
Mr. Sallman stated that he really did not have the information he needed to answer the question.
He received the application last week and had not had time to review it.
Councilmember Bolkcom stated that she thought it would increase police time with bad checks.
Mayor Jorgenson stated that she had concerns not so much with the check cashing but with the
pawn shop and people bringing in what may not be their property, being paid by check from
Pawn America, and then cashing Pawn America's check.
Mr. Lee stated he understood that the statistics on stolen material for pawnshops was extremely
low. He stated that the business is highly regulated.
Councilmember Wolfe had concerns about the negative perception about the pawnshop and the
check cashing right next door to each other.
Mr. Lee stated that it is Pawn America's money that would be at risk which increases their
willingness to verify the pawn transaction and check cashing transaction.
Councilmember Barnette noted that Council had no basis for disapproval.
Councilmember Billings noted how there was insufficient information to make a deterniination.
If Council disapproves it, the sole responsibility for defending that action in court falls onto City
of Fridley, and State of Minnesota takes no responsibility for the action of defending the action of
the City of Fridley. Councilmember Billings noted his displeasure with the State statute
regarding this application.
FRIDLEY CITY COUNCIL MINUTES OF JCJNE 28 1999 PAGE 9
Mr. Hickok stated that in the review of this issue staff was very frustrated to come to Council
with a lack of knowledge and a recommendation of an issue especially when they know Council
likes to make informed decisions. Mr. Hickok took full responsibility and apologized for not
coming to Council earlier. He did not have the information they needed.
Ms. Dacy, Director of Community Development, stated that she would accept the responsibility
for not bringing this to Council's attention earlier.
There were no questions or comments from the public.
MOTION by Councilmember Billings to close the public hearing at 9:05 p.m. Seconded by
Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE PUBLIC HEARING
WAS CLOSED AT 9:05 P.M. �
MOTION by Councilmember Billings to direct the City Attorney to write a letter to the
Minnesota Department of Commerce stating Council's frustrations with the State statute
indicating the statute makes no provisions for approval or disapproval, that Council resents
having to spend money to hold a public hearing, and the application was confusing. He also
war�ted the letter to indicate that it was the viewpoint of the Council that the Minnesota
Department of Commerce had apparently sent an incomplete application; and therefore, denied
Council an opportunity to fully evaluate the application. Seconded by Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIMOUSLY.
OLD BUSINESS:
11. MOTION TO APPROVE LEASE BETWEEN THE CITY OF FRIDLEY AND
LYNDALE TERMINAL COMPANY FOR TI� FRIDLEY LIOUOR
WAREHOUSE STORE (WARD 31 (TABLED JUNE 14,1999)•
Mr. Richard Pribyl, Finance Director, spoke regarding issues of the lease between the City and
Lyndale Ternunal Company for the Fridley Liquor Warehouse Store. Mr. Pribyl also spoke
regarding issues with Stuart Anderson's Cattle Company parking lot.
Mr. Pribyl explained that it was anticipated that the City could become the number one municip��.
off-sale retailers in the state. The liquor store would also benefit the City by reducing property
taxes.
Mayor Jorgenson asked if all of the construction costs would be �paid for out of the liquor fund.
FRIDLEY CITY COUNCIL MINUTES OF JLTNE 28,_1999 PAGE 10
Mr. Pribyl confirmed that the liquor fund would pay for the construction costs.
MOTION by Councilmember Bolkcom to approve the lease between the City of Fridley and
Lyndale Terminal Company for the Fridley Liquor Warehouse Store. Seconded by Council-
member Billings.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DELCARED THE MOTION CARRIED UNA1vIMOUSLY.
NEW BUSINESS:
12. RESOLUTION NO. 46-1999 OPPOSING THE PROPOSED SPEED LINIIT
INCREASE BY THE n�IINNESOTA DEPARTMENT OF TRANSPORTATION ON
TRUNK HIGHWAY 47 FROM 68TH AVENUE N.E. TO 45TH AVENUE N.E.:
MOTION by Councilmember Billings to approve Resolution No. 46-1999. Seconded by
Councilmember Bolkcom.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGENSON
DECLARED THE MOTION CARRIED UNANIlVIOUSLY.
13. INFt�R1V1AL STATUS REPORTS:
Councilmember Bolkcom summarized some of the events of the Fridley `49er Days and the
events that took place at Columbia Arena. She also stated that she now has a better appreciation
for all of the City's firefighters and rescue workers.
Councilmember Barnette commented on how well the all-class high school reunion went. He
commended Mr. Chuck McKusick for all he did for the Upper Midwest Auto Extrication
Competition. He also thanked everyone involved in the success of all of the events.
Mayor Jorgenson commented on how well the horseshoe tournament went.
Councilmembers discussed how well the wrestling event went also.
ADJOURN:
MOTION by Councilmember Billings to adjourn the meeting at 9:30 p.m. Seconded by
Councilmember Barnette.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, MAYOR JORGEI�IS�I�I
DECLARED THE MOTION CARRIED UNANIlVIOUSLY AND THE JUNaE 2�9 ll���
MEETING OF THE CITY COUNCIL WAS ADJOURNED AT 9:30 P.M.
FRIDLEY CITY COLINCIL MINUTES OF J[JNE 28 1999 PAGE 11
Respectfully submitted,
Signe L. Johnson Nancy J. Jorgenson
Recording Secretary Mayar
r AGENDA ITEM
` CITY COUNCIL MEETING OF JULY 12, 1999
UTY OF
PRIDLEY
TO: WILLIAM W. BURNS, CITYMANAGER ���
FROM: RICHARD D. PRIBYL, FINANCE DIRECTOR
SUBJECT: A RESOLUTIONAPPROVING THE ISSUANCE AND SALE OF THE $200,000
SUBORDINATED SENIOR HOUSING REVENUE NOTE, SERIES 1999 AND
A UTHOORIZING THE EXECUTION OF DOCUMENTS RELATING THERETO
(BANFILL CROSSING HOMES PROJEC7�
DATE: July 9, 1999
In connection with the fmancing of the project known as "Banfill Crossing Homes", one note will be
issued on a subordinated basis to the bonds that were approved at the last City Council Meeting. Due
to an oversight, this resolution was not included with the resolution passed on June 26`h. The note,
known as the $200,000 Subordinated Senior Housing Revenue Note, Series 1999, will be issued to
Senior Housing Construction, Inc. This note along with the one that was approved by the City
Council are payable solely from Project Net Operating Income. This issue is subordinate to the latger
issue approved two weeks ago and will only be paid after the payment of the debt servi�e on the
senior bonds.
RDP/me
Attachment
1
RESOLUTION APPROVING THE ISSUANCE AND SALE OF TIiE
$200,000 SUBORDINATED SE1vIOR HOUSING REVENUE NOTE, SERIES 1999
AND AUTHORIZING THE EXECUTION OF DOCUMENTS RELATING THERETO
(BANFILL CROSSING HOMES PROJECT)
follows:
BE TT RESOLVED by the City Council of the City of Fridley, Minnesota (the "City"), as
LEGAL AUTHORIZATION AND FINDINGS.
1.1 F'indin�s. Tne City hereby finds, determines and declares as follows:
(a) The City is a political subdivision of the State of Minnesota and is authorized
under Minnesota Statutes, Chapter 462C, as amended (the "AcY') to assist the revenue producing
project herein referred to, and to issue and sell the Subordinated Note, as hereinafter defined, for
the purpose, in the manner and upon the terms and conditions set forth in the Act and in this
Resolution.
(b) As required by the Act and Secrion 147(fl of the Intemal Revenue Code of 1986,
as amended (the "Code"), the City has, on July 14, 1997, held a public hearing on the issuance of
one or more revenue notes to finance the Project.
(c) The issuance of the $200,000 Subordinated Senior Housing Revenue Note, Series
1999 (Banfill Crossing Homes Project) to be issued in a single note (the "Subordinated Note") by
the City, pursuant to the Act, is in the best interest of the City, and the City hereby deterinines to
issue the Subordinated Note, as provided herein.
(d) Pursuant to a Subordinated Note Loan Agreement (the "Subordinated Note Loan
Agreement") to be entered into between the City and Minnesota Chrisrian Homes of Fridley, Inc.
(the "Bonower"), the Borrower has agreed to repay the Subordinated Note in specified amounts
and at specified times suf�cient to pay in full when due the principal of, premium, if any, and
interest on the Subordinated Note. In addition, the Subordinated Note Loan Agreement contains
provisions relating to the construction, the maintenance and operation of the Project,
indemnification, insurance, and other agreements and covenants which are required or permitted
by the Act and which the City and the Borrower deem necessary or desira.ble for the financing of
the Project. A draft of the Subordinated Note Loan Agreement is on file with the City.
(e) Pursuant to a Pledge Agreement to be entered into between the City and the
Purchaser (as �erein defined), the City has pledged and granted a security interest in all of its
rights, title, and interest in the Subordinated Note Loan Agreement to the Purchaser (except for
certain rights of indemnification and to reimbursement for certain costs and expenses). A draft of
the Pledge Agreement is on file with the City.
( fl The Subordinated Note will be a special limited obligation of the City. The
Subordinated Note sha11 not be payable from or charged upon any funds other than the revenues
pledged to the payment thereof, nor shall the City be subject to any liability thereon. No holder of
the Subordinated Note shall ever have the right to compel any exercise of the taxing power of the
City to pay the Subordinated Note or the interest thereon, nor to enforce payment thereof agaixist
2
any property of the City. The Subordinated Note shall not constitute a debt of the City within the
meaning of any constitutional or statutory limitation.
(g) It is desirable, feasible and consistent with the objects and purposes of the Act to
issue the Subordinated Note.
2. THE SUBORDINATED NOTE.
2.1 Authorized Amount and Form of Subordinated Note. The Subordinated Note issued
pursuant to this Resolurion shall be in substantially the form attached as Exhibit A with such appropriate
variarions, omissions and insertions as are pemutted or required by this Resolution, and in accordance with
the further provisions hereof. The Subordinated Note in the amount of $200,000 shall be issued to Senior
Housing Construction, Inc. (the "Purchaser"). The Subordinated Note may be issued in such amount but
not to exceed $200,000 unless a duplicate Subordinated Note is issued pursuant to Section 2.7 and shall be
registered to such individuals or entities as designated by the Purchaser. The Subordinated Note will be
issued in satisfaction of $200,000 owed by the Borrower to the Purchaser pursuant to that certain
Sripulated Sum Standard Form Agreement Between Owner and Contractor (Labor), dated June 18, 1999
(the "Construction Contract"), and shall be issued to the Purchaser concurrently with the issuance of the
City's Senior Housing Revenue Bonds (Banfill Crossing Homes Project) Series 1999, to be issued in the
approximate amount of $9,630,000 (the "Bonds"). The Subordinated Note shall bear interest at the rates
set forth in the Subordinated Note and shall be subordinate to the Bonds under the terms set forth in the
Subordinated Note.
2.2 The Subordinated Note. The Subordinated Note shall be dated as of the date of delivery
to the Purchaser, shall be payable at the times and in the manner, shall bear interest at the rate, and shall
be subject to such other terms and conditions as are set forth therein.
2.3 Execution. The Subordinated Note shall be executed on behalf of the City by the
signatures of its Mayor and City Manager and shall be sealed with the seal of the City; provided that the
seal may be intentionally omitted as provided by law. In case any officer whose signature shall appear on
the Subordinated Note shall cease to be such officer before the delivery of the Subordinated Note, such
signature shall nevertheless be valid and sufficient for all purposes, the same as if had remained in office
until delivery. In the event of the absence or disability of the Mayor or the City Manager such officers of
the City as, in the opinion of the City Attorney, may act in their behalf, shall without further act or
authorization of the City Council execute and deliver the Subordinated Note.
2.4 Deliverv of Inirial Subordinated Note. Before delivery of the Subordinated Note there
shall be filed with the Purchaser the following items:
(i) an executed copy of each of the following documents:
(ri) the Subordinated Note Loan Agreement;
(ui) the Pledge Agreement;
(b) an opinion of Counsel for the Borrower as prescribed by the Purchaser and Bond
Counsel;
3
(c) the opinion of Bond Counsel as to the validity and tax exempt status of the
Subordinated Note;
(d) a 501(c)(3) deternunarion letter from the Internal Revenue Service evidencing
that the Borrower is exempt from income taxation under Section 501(c)(3) of the Code;
(e) such other documents and opinions as Bond Counsel may reasonably require for
purposes of rendering its opinion required in subsection (c) above or that the Purchaser may
reasonably require for the closing.
2.5 Disnosition of Subordinated Note Proceeds. Upon delivery of the Subordinated 1Vote to
the Purchaser, the Purchaser shall issue a receipt to the Borrower and the City for $200,000 with respect
to payments owed on the Construcrion Contract.
2.6 ReQistration of Transfer. The City will cause to be kept at the office of the City Manager
a Subordinated Note Register in which, subject to such reasonable regulations as it may prescribe, the City
shall provide for the registration of transfers of ownership of the Subordinated Note. The Subordinated
Note shall be initially registered in the name of the Purchaser and shall be transferable upon the
Subordinated Note Register by the Purchaser in person or by its agent duly authorized in writing, upon
surrender of the Subordinated Note together with a written instrument of transfer satisfactory to the City
Manager, duly executed by the Purchaser or its duly authorized agent. The following form of assignment
shall be sufficient for said purpose.
For value received hereby sells, assigns and transfers unto the
within Subordinated Note of the City of Fridley, Minnesota, and does hereby urevocably constitute and
appoint attomey to transfer said Subordinated Note on the books of said City
with full power of substitution in the premises. The undersigned certifies that the transfer is made in
accordance with the provisions of Section 2.9 of the Resolution authorizing the issuance of the
Subordinated Note.
Dated:
Registered Owner
Upon such transfer the City Manager shall note the date of registration and the name and address of the new
Purchaser in the Subordinated Note Register and in the registration blank appearing on the Subordinated Note.
2.7 Mutilated, Lost or Destroved Subordinated Note. In case any Subordinated Note issued
hereunder shall become mutilated or be destroyed or lost, the City shall, if not then prohibited by law,
cause to be executed and delivered, a new Subordinated Note of like outstanding principal amount, number
and tenor in exchange and substitution for and upon cancellation of such mutilated Subordinated Note, or in
lieu of and in substitution for such Subordinated Note destroyed or lost, upon the Purchaser's paying the
reasonable expenses and charges of the City in connection therewith, and in the case of a Subordinated
Note destroyed or lost, the filing with the City of evidence satisfactory to the City with indemnity
satisfactory to it. If the mutilated, destroyed or lost Subordinated Note has already matured or been called
for redemption in accordance with its terms it sha11 not be necessary to issue a new Subordinated Note
priar to payment.
C�
2.8 Ownershin of Subordinated Note. The City may deem and treat the person in whose
name the Subordinated Note is last registered in the Subordinated Note Register and by notation on the
Subordinated Note whether or not such Subordinated Note shall be overdue, as the absolute owner of such
Subordinated Note for the purpose of receiving payment of or on account of the Principal Balance,
redemprion price or interest and for all other purposes whatsoever, and the City shall not be affected by
any notice to the contrary.
2.9 Limitation on Subordinated Note Transfers. The Subordinated Note has been issued
without registration under state or other securities laws, pursuant to an exemption for such issuance; and
accordingly the Subordinated Note may not be assigned or transferred in whole or part, nor may a
participation interest in the Subordinated Note be given pursuant to any participation agreement, except
upon receipt of a written opinion of Bond Counsel that an exemption exists for such transfer.
2.10 Issuance of New Subordinated Notes. Subject to the provisions of Section 2.9, the City
shall, at the request and expense of the Purchaser, issue new notes, in aggregate outstanding principal
amount equal to that of the Subordinated Note surrendered, and of like tenor except as to number and
principal amount, and registered in the name of the Purchaser or such transferee as may be designated by
the Purchaser.
3. MISCELLANEOUS.
3.1 Severabilitv. If any provision of this Resolution shall be held or deemed to be or shall, in
fact, be inoperarive or unenforceable as applied in any particular case in any jurisdiction or jurisdictions or
in all jurisdicrions or in all cases because it conflicts with any provisions of any constitution or statute or
rule or public policy, or for any other reason, such circumsta.nces shall not have the effect of rendering the
provision in question inoperative or unenforceable in any other case or circumstance, or of rendering any
other provision or provisions herein contained invalid, inoperarive, or unenforceable to any extent
whatever. The invalidity of any one or more phrases, sentences, clauses or paragraphs in this Resolution
contained shall not affect the remaining portions of this Resolution or any part thereof.
3Z Authenrication of Transcrint. The officers of the City are directed to fixmish to Bond
Counsel certified copies of this Resolution and all documents referred to herein, anci affidavits or
certificates as to all other matters which are reasonably necessary to evidence the validity of the
Subordinated Note. All such certified copies, certificates and affidavits, including any heretofore
furnished, shall constitute recitals of the City as to the correctness of all statements contained therein.
3.3 Authorization to Execute Aereements. The forms of the proposed Subordinated Note
Loan Agreement, and the Pledge Agreement, are hereby approved in substantially the form on file with
the City, together with such additionai details therein as may be necessary and appropriate and such
modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and
approved by Bond Counsel and the City Attorney prior to the execution of the documents, and the Mayor
and City Manager of the City are authorized to execute the Subordinated Note Loan Agreement, the
Assignment and the Pledge Agreement in the name of and on behalf of the City and such other documents
as Bond Counsel consider appropriate in connection with the issuance of the Subordinated Note. In the
event of the absence or disability of the Mayor or the City Manager such officers of the City as, in the
opinion of the City Attomey, may act in their behalf, shall without further act or authorization of the City
Council do all things and execute all instruments and documents required to be done or executed by such
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absent or disabled officers. The execution of any ins�ument by the appropriate officer or officers of the
City herein authorized shall be conclusive evidence of the approval of such documents in accordance with
the terms hereof.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS DAY
OF , 1999
ATTEST:
DEBRA A. SKOGEN — CITY CLERK
0
NANCY J. JORGENSON — MAypR
EXHIBIT A
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF ANOKA
CITY OF FRIDLEY
Subordinated Senior Housing Revenue Note, Series 1999
(Banfill Crossing Homes Project)
$200,000
FOR VALUE RECEIVED the CTTY OF FRIDLEY, Anoka County, Minnesota (the "City") hereby
promises to pay Senior Housing Construcrion, Inc., in Victoria, Minnesota, its successors or registered assigns
(the "Holder"), from the source and in the manner hereinafter provided, the principal sum of $200,000, or so
much thereof as remains unpaid from time to rime (the "Principal Balance"), with interest thereon from the date
hereof until Mazch 1, 2034 (the "Final Maturity Date") at 6.25% per annum, in any coin or currency which at
the time or times of payment is legal tender for the payment of public or private debts in the United States of
America, in accordance with the terms hereinafter set forth.
This Subordinated Note and interest thereon and any service charge or premium, if any, due hereunder
are payable solely from the revenues and proceeds derived from the Subordinated Note Loan Agreement of
even date herewith between the City and Minnesota Christian Homes of Fridley, Inc. (the "Borrower") (the
"Subordinated Note Loari Agreement"). The City and the Holder intend that tlus Subordinated Note be paid
only from and to the extent of sums available therefor under the Subordinated Loan Agreement after ()
payment of current debt service with respect to the City's [59,630,000] of Senior Housing Revenue Bonds
(B�11 Crossing Homes Project) Series 1999 (the "Bonds"), and (ii) the Borrower has caused all deposits to
the funds and accounts as provided for in Section 5.3(2), subsections (a) through (g), of that certain Indenture of
Trust, dated as of July 1, 1999, between the City and U.S. Bank Trust National Association, as tcustee (the
"Trustee"), entered into with respect to the Bonds (the "Indenture"). All payments hereunder shall be applied
first to accrued and unpaid interest, and the balance shall be applied to the outstanding Principal Balance.�
If the interest on this Note should become subject to federal income taxation pursuant to a
"Determinarion of Taxability" as that term is defined in the Subordinated Note Loan Agreement, and the Holder
delivers to the Borrower a copy of the notice of the "Determination of Taxability", the interest rate shall be
immediately adjusted to be three percent above the interest rate then in effect and each installment thereafter
payable shall be accordingly adjusted and shall be equal to the amount necessary to amortize the remaining
Principal Balance by the Final Maturity Date with interest at said adjusted rate; and in addition the Holder shall
be entitled to receive upon demand an amount equal to the aggregate difference between �) the monthly
payments theretofore made to the Holder on this Note between the "Date of Taxability", as that term is defined
in the Subordinated Note Loan Agreement, and the date of receipt by the Borrower of notice of such
"Determination of Taxability", and (u) the monthly payments which would have been made during such period if
the adjusted rate had been in effect throughout such period.
1. Accrued interest and principal, to the extent sums aze available therefor pursuant to Section
5.3(2)(h) of the Indenture, shall be payable only to the extent of such available funds semiannually
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on March 1 and September 1 of each yeaz (each, an"Payment Date"), commencing on Mazch 1,
2001 (the "Commencement Date"), and continuing on each Payment Date thereafter until the
Maturity Date.
2. In any event, the payments hereunder shall be sufficient to pay all principal and interest due, as
such principal and interest becomes due, and to pay any premium or service charge, at maturity,
upon redemprion, or otherwise. Interest shall be computed on the basis of a 360 day yeaz, but
charged for the actual number of days elapsed.
Principal and interest and premium or service chazge, if any, due hereunder shall be payable at the
principal office of the Holder, or at such other place as the Holder may designate in writing.
4. This Note is issued by the City to provide financing for a portion of the cost of a project, as
defined in Minnesota. Statutes, Chapter 462C, consisting of the acquisition and equipping of senior
housing facilities to be owned and operated by Minnesota Christian Homes of Fridley, Inc., a
Minnesota nonprofit corporation (the "Borrowe�') pursuant to a Subordinated Note Loan
Agreement dated as of July 1, 1999 by and between the City and the Borrower (the
"Subordinated Note Loan Agreement"), and this Note is further issued pursuant to and in full
compliance with the Constitution and laws of the State of Minnesota, particularly Minnesota
Statutes, Chapter 462C and pursuant to a resolurion of the City Council duly adopted on June 28,
1999 (the "Resolurion").
5. This Note is secured by a Pledge Agreement of even date herewith between the City and the
Holder (the "Pledge Agreement").
6. Payments on this Note are subordinate to payments of debt service on the Bonds, and Holder.
agrees that the following terms of subordination apply to this Note:
(a) Subordination of Notes' Debt Service.
(i) During any time that (i) the City has not paid in full, on a current basis, all
amounts then due and payable under the Bonds, or (ii) the Rebate Fund, the Bond
Reserve Fund, the Operations and Maintenance Fund, the Bond Fund, the Replacement
Fund or the Operating Deficit Fund (collectively, the "Trust Funds") aze not fully fimded
at their required amounts pursuant to the terms of the Indenture, the Holder will not ask
for, demand, sue for, take, receive or accept from the City or the Bonower, by setoff or
in any other manner, any payment or distribution from the City or the Borrower relating to
the Subordinated Note or any other obligation or indebtedness, whether presently existing
or arising in the future.
(n) During any time that (i) the City has not paid in full, on a current basis, all
amounts then due and payable under the Bonds, or (ii) the Trust Funds are not fully
funded at their required amounts pursuant to the terms of the Indenture, the City and the
Borrower covenant and agree that they shall not pay to the Holder, by setoff or in any
other manner, any payment or distribution relating to the Subordinated Note or any other
obligation or indebtedness, whether presently existing or arising in the future.
(ni) the Holder will not ask for, demand, sue for, take, receive or accept from
the City or the Borrower, by setoff or in any other manner, any payment or distribution
from the City or the Borrower if the making of such payment will constitute or would
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result in the occurrence of a violation of the provisions of any instrument or agreement
evidencing, in connection with, or securing the Bonds or would result in the occurrence of
any event which with the giving of notice or lapse of time or both would constitute. an
event of default under the provisions of any such instrument or agreement.
(iv) In the . event the Holder shall receive any payment or distribution which
the Holder is not enrided to receive under the foregoing provisions, the Holder will tum
over such payment to Trustee in the form received by it to be applied to the Bonds or
deposited into the Trust Funds, as the case may be.
(b) Limitation on Remedies of the Holder. Unri! such time as tlae Bonds are gaid in
full, the Holder shall not do any of the following:
(i) Commence any action or proceeding against the City or the Borrower to
recover all or any part of the Subordinated Note or join with any other creditor, unless the
Trustee shall also join, in bringing any proceedings against the City or the Borrower under
any banl�uptcy, reorganization, readjustment or debt, arrangement of debt, receivership,
liquidation or insolvency law or statute of the federal or any state govemmen�
(ri) Commence any acrion or proceeding against any collateral provided as
security for the Subordinated Note, including without limitation against the Project or the
rents therefrom, unless the Trustee provides written consent and shall have previously
commenced and continues to pursue such an action pursuant to the Bonds. Furthermore,
if the Trustee ceases to pursue a previously commenced action as a result of the City's or
Borrower's cure of the default or for any other reason, the Holder shall likewise cease to
pursue any action commenced by it whether or not the default under the Subordinated
Note has been cured.
(rii) The limitation of the Holder's remedies shall preclude any foreclosure,
taking in possession, appointment of a receiver, exercise of any rights under any
assignment of rents or any other action which may interfere with the Trustee's
possession, operation or management of the Project or the exercise by the Trustee of its
rights and remedies under the Indenture until such time as specifically provided in the
Indenture.
(c) Modification of Bond Loan. The Trustee, the City and the Borrower, or their
successors and assigns may, at any time, and from time to time, without the consent of or notice to
the Holder, without incurring responsibility to the Holder, and without impairing or releasing any of
the obligations of the Holder hereunder and without said actions affecting the full and complete
subordination of the Subordinated Note to the Bonds:
(i) change the amount, manner, place or terms of payment, or change or
extend for any period of time of payment of or renewal or otherwise alter or modify, the
Bonds or any instrument or agreement evidencing, in connection with, as security for or
providing for the issuance of any portion of the Bonds in any manner or enter into or
amend in any manner any other agreement relating to the Bonds;
(ii) sell, exchange, release or otherwise deal with all or any part of any
properiy or other security pledged or mortgaged to secure the Bonds including without
limitation the Project;
A-3
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(iri) release anyone liable in any manner for payment or collection of the
Bonds;
(iv) exercise or refrain from exercising any rights against the City or the
Borrower or others;
(v) accept additional security of any kind for repayment of the Bonds; and
(vi) apply any sum received by the Trustee, by whomsoever paid and
however realized, to payment of the Bonds in such manner as the Trustee, in its sole
discretion, may deem appropriate.
(d) Covenants of the Holder. The Holder covenants that it will:
(i) execute any and all other instruments reasonably required by the City or
the Trustee to evidence the subordination of the Subordinated Note to the Bonds; and
(ri) not assign or transfer to any others any claim the Holder has or may have
against the City or the Borrower as long as any of the Bonds remains outstanding, unless
such assignment or transfer is expressly made subject to the terms hereof; and
(in) not increase the principal balance of the Subordinated Note or extend,
alter or otherwise modify the terms of the Subordinated Note in any manner without the
prior written approval of the Trustee (which approval may be granted or withheld by the
Trustee in its sole discretion).
The City, for itself, its successors and assigns, hereby waives demand, presentment, protest and
notice of dishonor; and to the extent pernutted by law, the Holder may extend interest and/or
principal of or any service chazge or premium due on this Subordinated Note, including the Final
Maturity Date, or release any part or parts of the property and interest subject to any security
document from the same, all without notice to or consent of any pazty liable hereon or thereon and
without releasing any such party from such liability and whether or not as a result thereof the
interest on the Subordinated Note is no longer exempt from the federal or state income tax. In no
event, however, may the Final Maturity Date of the Subordinated Note be extended beyond thirty-
five (35) years from the date hereof.
8. Subject to the terms of Section 6 hereof, this Subordinated Note may be prepaid in whole or in
part, at the option of the Borrower, on any business day thereafter, without premium, at a price of
par and accrued interest.
9. Upon the occurrence of an Event of Default, as defined in the Subordinated Note Loan
Agreement, the Holder may declaze the Principal Balance and accrued interest on the
Subordinated Note to be immediately due and payable.
10. As provided in the Resolution and subject to certain limitations set forth therein, this Subordinated
Note is only transferable upon the books of the City at the office of the City Clerk, by the Holder
in person or by its agent duly authorized in writing, at the Holder's expense, upon surrender hereof
together with a written inshument of transfer satisfactory to the City Clerk, duly executed by the
Holder or its duly authorized agent. Upon such transfer the Clerk will note the date of registration
and the name and address of the new registered owner in the registration blank appearing bel��.
A-4
10
The City may deem and treat the person in whose name the Subordinated Note is last registered
upon the books of the City with such registrarion noted on the Subordinated Note, as the absolute
owner hereof, whether or not overdue, for the purpose of receiving payment of or on the account,
of the Principal Balance, redemprion price or interest and for all other purposes, and all such
payments so made to the Holder or upon his order shall be valid and effective to satisfy and
discharge the liability upon the Subordinated Note to the extent of the sum or sums so paid, and
the City shall not be affected by any norice to the contrary.
11. All of the agreements, conditions, covenants, provisions and stipulations contained in the
Resolution, the Subordinated Note Loan Agreement and the Pledge Agreement are hereby made
a part of this Subordinated Note to the same extent and with the same force and effect as if they
were fully set forth herein.
12. This Subordinated Note and interest thereon and any service charge or premium, if any, due
hereunder are payable solely from the revenues and proceeds derived from the Subordinated Note
Loan Agreement and do not constitute a debt of the City within the meaning of any constitutional
or statutory limitation, are not payable from or a chazge upon any funds other than the revenues
and proceeds pledged to the payment thereof, and do not give rise to a pecuniary liability of the
City or any of its officers, agents or employees, and no holder of this Subordinated Note shall ever
have the right to compel any exercise of the taxing power of the City to pay this Subordinated
Note or the interest thereon, or to enforce payment thereof against any property of the City, and
this Subordinated Note does not constitute a charge, lien or encumbrance, legal or equitable, upon
any property of the City, and the agreement of the City to perform or cause the performance of
the covenants and other provisions herein referred to shall be subject at all times to the availability
of revenues or other funds fumished for such purpose in accordance with the Subordinated Note
Loan Agreement, sufficient to pay all costs of such performance or the enforcement thereof.
13. If an Event of Default (as that term is defined in the Subordinated Note Loan Agreement) shall
occur, then the Holder shall have the right and option to declare, upon ten (10) days written notice,
the Principal Balance and accrued interest thereon, immediately due and payable, whereupon the
same, plus any premiums or service chazges, shall be due and payable, but solely from sums made
available under the Subordinated Note Loan Agreement. Failure to exercise such option at any
rime shall not constitute a waiver of the right to exercise the same at any subsequent time.
14. The remedies of the Holder, as provided herein and in the Subordinated Note Loan Agreement
and the Pledge Agreement, are not exclusive and shall be cumulative and concurrent and may be
pursued singly, successively or together, at the sole discretion of the Holder, and may be exercised
as often as occasion therefor shall occur; and the failure to exercise any such right or remedy
shall in no event be construed as a waiver or release thereof.
15. The Holder shall not be deemed, by any act of omission or commission, to have waived any of its
rights or remedies hereunder unless such waiver is in writing and signed by the Holder and, then
only to the extent specifically set forth in the writing. A waiver with reference to one event shall
not be construed as continuing or as a bar to or waiver of any right or remedy as to a subsequent
event.
16. This Subordinated Note has been issued without registration under state or federal or other
securities laws, pursuant to an exemption for such issuance; and accordingly the Subordinated
Note may not be assigned or transferred in whole or part, nor may a participation interest in the
A-5
11
Subordinated Note be given pursuant to any participarion agreement, except in accordance with an
applicable exemption from such registration requirements. The City acknowledges that the Holder
intends to enter into a participation agreement with one or more sophisticated investors.
IT IS HEREBY CERT'IFIED AND RECITED that all conditions, acts and things required to exist
to happen and to be performed precedent to or in the issuance of this Subordinated Note do exist, have
happened and have been performed in regular and due form as required by law.
A-6
12
IN WITNESS WHEREOF, the City has caused this Subordinated Note to be duly executed in its name
by the manual signatures of the Mayor and City Manager, the corporate seal having been intentionally omitted
as pemutted by law, and has caused this Subordinated Note to be dated as of July _, 1999
A-7
13
PROVISIONS AS TO REGISTRATION
The ownership of the unpaid Principal Balance of this Subordinated Note and the interest accruing
thereon is registered on the books of the City of Fridley in the name of the holder last noted below.
Date of
Re�istration
Julv , 1999
Name and Address
, Re�istered Owner
Senior Housing
Construction, Inc.
A-8
14
Signahue of
Citv Mana�er
.
�
�
CfTY OF
FRIDLEY
Name
Carolyn
Dreyer
Eugene
Abel
Jane
Oster
AGENDA ITEM
CITY COUNCIL MEETING OF JULY 12, 1999
Position
Head l.iquor
Store Clerk
Non-exempt
Head Liquor
Store Clerk
Non-exempt
Head Liquor
Store Clerk
Non-exempt
Appointment
Starting
Salary
$12.21
per hour
$12.21
per hour
$12.21
per hour
15
Starting
Date
June 29,
1999
June 29,
1999
June 29,
1999
Replaces
Division
Restructuring
Division
Restructuring
Division
Restructuring
: AGENDA ITEM
CITY COUNCIL MEETING OF JULY 12, 1999
CRY OF
FRIDLEY
CLAIMS
87914 - 88 � 85
16
.,
�
�
G1Y OF
FRIDLEY
AGENDA ITEM
CITY COUNCIL MEETING OF JULY 12, 1999
Type of License
ELECTRICAL
E K Electric
11401 Excelsior Blvd
Hopkins MN 55343
GAS SERVICES
Air Conditioning & Associates Inc
689 Pierce Butler Route
St Paul MN 55104-1696
Westair Inc
11184 River Rd NE
LICENSES
�
Brian Waterman
John Matthews
Hanover Mn 55341 Joe
Lynch
GENERAL CONTRACTOR-COMMERCIAL
EFH Co
2999 W Co Rd 42
Burnsville MN 55306 Mike Whalen
Kraus Anderson Construction Co
525S8St
Minneapolis MN 55404 Susan Hedstrom
New Haven Construction
4208 83 Ave N
Brooklyn Park MN 55443 Kerri Ivesdal
Midwest Restoration
6319 Hwy 65 NE
Fridley MN 55432 Gary Wruck
17
Approved By
STATE OF MN
RON JULKOWSKI
Building Official
Same
RON JULKOWSKI
Building Official
Same
Same
Same
Type of License �
GENERAL CONTRACTOR-RESIDENTIAL
Bangsund Construction (7408)
8805 Davern Ave NE
Monticello MN 55362 Ken Bangsund
Beers Construction (6551)
4208 6 Street NE
Columbia Heights MN 55421 Randy Beers
D L Builders (20096711)
1166 14 Ave SE
Minneapolis MN 55414 Dan Lemmenes
Dahl Builders & Remodelers (20050777)
451 Maple St
Spring Lake Park MN 55432 Dale
Dahl
First Choice Exteriors (4266)
2405 Annapolis Ln Ste 240
Plymouth MN 55441 Larry Froemming
Nurnberg Construction (20081011)
342 81 Ave N E
Spring Lake Park MN 55432 Heinrich Schonheit
Leger Roofing & Construction (20022818)
12033 Louisiana Ave N
Champlin MN 55316 Tim Leger
Precision Roofing (20141220)
200 W 88 St STE 4
Bloomington MN 55420 Jamie Fallis
Renslows Decks & Gazebos (8209)
1115 Southview Blvd
S St Paul MN 55075 Chris Renslow
Valley Investments Const (4241)
2401 Lexington Ave S
Mendota Heights MN 55120 Jim Williams
�%
Approved By
STATE OF MN
Same
Same
Same
Same
Same
Same
Same
Same
Same
�
.�
. '�
,
. Type of License
HEATING
Air Conditioning Associates Inc
689 Pierce Butler Route
Maple Plain MN 55359-9495
Westair
11184 River Rd NE
Hanover MN
553�1
PLUMBING
Buchman Plumbing Co Inc
PO Box 11070
Minneapolis MN 55412
Duda Plumbing Services
� 208 17 Ave N
Hopkins MN 55343
Olson Plumbing
11401 Excelsior Blvd
Hopkins MN 55343
ROOFING
Rayco Construction Inc
3801 5 St N E
Columbia Heights MN 55421
�
Gerald Sturm
Joe Lunch
Jeff Buchman
Leon Duda
Brian Waterman
Christy Malenke
19
Approved By
RON JULKOWSKI
Building Official
Same
STATE OF MN
Same
Same
RON JULKOWSKI
Building Official
�
�
�
CRY OF
FRIDLEY
AGENDA ITEM
CITY COUNCIL MEETING OF JULY 12, 1999
ESTIMATES
Frederic W. Knaak, Esq.
Holstad and Knaak, P.L.C.
3535 Vadnais Center Drive
St. Paul, MN 55110
Services Rendered as City Attorney
for the Month of June, 1999 .............................................................. $ 5,000.00
Ron Kassa Construction
- 6005 — 250�' Street East
Elko, NIN 55020
1999 Miscellaneous Concrete Curb and Gutter
and Sidewalk Project No. 322
Estimate No. 4 .................................................................................... $ 2,199.25
Park Construction Co.
7900 Beech Street N.E.
Fridley, MN 55432-1795
Riverview Heights Area Improvement
Project No. ST. 1999 —1
EstimateNo. 3 ..................................................................................... $ 311,158.63
20
/
�
QTY OF
FRIDLEY
AGENDA ITEM
CITY COUNCIL MEETING OF JULY 12, 1999
TO: The Honorable Mayor and City Council
FROM: William W. Burns, City Manager,,� �
.
DATE:
SUBJECT:
July 8,1999
Public Hearing - Utility Franchise Fees
Attached is the public hearing notice for the proposed utility franchise fees. The public hearing
will be held on Monday, July 12, 1999.
As background information for the public hearing, we are also attaching the following:
.
.
Franchise Fee Ordinance
Memorandum Addressing Frequently Asked Questions
Franchise Fee Comparisons with other Cities
Proposed Franchise Fee Summary
Definition of Customer Classifications for Minnegasco and NSP
Franchise Fee Brochures
21
CITY OF FRIDLEY
PUBLIC HEARING
BEFORE THE
CITY COUNCIL
Notice is hereby given that the Council of the City of Fridley will hold a public hearing at the City
Municipal Center, 6431 University Avenue Northeast on July 12, 1999 at 7:30 p.m. for the general
discussion of imposing electric and gas franchise fees to the residents of Fridley (proposed City
Code Chapter 409).
Hearing impaired persons planning to attend who need an interpreter or other persons with
disabilities who require auxiliary aids should contact Roberta Collins at 572-3500 no later than July
8, 1999.
Anyone having an interest in this matter should make their interest known at this public hearing.
Publish: June 17, 1999
ZZ
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF FRIDLEY, MINNESOTA,
AMENDING THE CITY CODE TO INCLUDE A NEW CHAPTER 409,
ENTITLED "FRANCHISE FEES"
THE CITY COUNCIL OF THE CITY OF FRIDLEY ORDAINS
SECTION 409.01. PURPOSE
The Fridley City Council has determined that it is in the best interest of the City to impose an
equivalent franchise fee on all entities providing electric and gas service pursuant to franchise
within the City in accordance with the franchise agreement entered between the City and each
such energy supplier. The franchise fee is paid as full compensation for the rights to transmit and
distribute electric or gas energy for public or private use within and through the limits of the City
as permitted by the respective franchise of each energy supplier. The equivalent fee was
determined in advance by the City based on each energy suppliers' estimated Gross Revenues so
that the fee paid by one Customer Classification is in all material respects the equivalent, based
on a percentage of the estimated Gross Revenues for the Customer Classification, of the fee paid
by each similar Customer Classification(s) of the other energy suppliers.
SECTION 409.02. FEE SCHEDULES
1. Minnegasco Com�any Gas Service Fee Schedule. A franchise fee is hereby imposed on
Minnegasco Company for its gas franchise granted by the City in the following amounts and as
defined in Section 7 of the parties' Franchise Agreement.
Customer Classification Amount per Month
Residential 3% of customer's monthly gas bill
Firm A $0.87 per month
Firm B 2.82 per month
Firm C 13.18 per month
SVDF A 26.59 per month
SVDF B 147.50 per month
LVD 150.00 per month
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2. Northern States Power Company Electric Service Fee Schedule. A franchise fee is hereby
imposed on Northern States Power Company for its electric franchise granted by the City in the
following amounts and as defined in Section 9 of the parties' Franchise Agreement:
Customer Classification
Residential
Small C/I & Municipal, no demand charge
Small C/I & Municipal, w/demand charge
Large C/I Secondary
Large C/I Primary
SECTION 409.03. PAYMENT
Amount per Month
3% of customer's monthly gas bill
$1.90 per month
$12.50 per month
$93.00 per month
$150.00 per month
Said franchise fee shall be payable to the City quarterly. The payment shall be due the last business
day of the month following the preceding quarter of the calendar year and shall be based on the
electric or gas set-vice provided for the preceding quarter of the calendax year. Each energy supplier
shall furnish with each payment a statement of the amounts collected by customer classification for
the period on which the payment was based. Each energy supplier shall permit the City and its
representative free access to supplier records for the purpose of verifying such statements.
SECTION 409.04. REDUCED OR REBATED RESIDENTIAL FEE FOR ECONOMIC
HARDSHIP •
Upon showing of economic hardship, a rebate of the franchise fee paid by resident citizens can be
granted by the City. A hardship shall be determined by the relationship between the previous year's
income tax return and the Federal Poverty Guidelines as annually established and published in the
Federal Register by the United States Department of Health and Human Services. A hardship shall
be deemed to exist when the annual gross income of the household for the previous year is less than
the Federal Poverty Guidelines of the cunent year. If an economic hardship exists, the amount paid
by the household shall be rebated by the City to the household within a reasonable time after the end
of the year within which the fee was paid.
SECTION 409.05. ENFORCEMENT
Any dispute, including enforcement of a default regarding this Ordinance, shall be resolved in
accordance with dispute resolution provisions of each energy supplier's Franchise Agreement.
SECTION 409.06. EFFECTIVE DATE
This Ordinance shall become effective 60 days after notice enclosing the adopted ordinance has been
served on each energy supplier by certified mail. Collection of said fees from customers shall
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commence with the beginning cycle of supplier's next full billing month following the expiration of
the 60 day period.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS
DAY OF , 1999.
ATTEST:
DEBRA A. SKOGEN - CITY CLERK
Pub(ic Hearing: July 12, 1999
First Reading:
Second Reading:
Pub(ication:
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NANCY J. JORGENSON - MAYOR
Memo to: The Nlayor and Council
From: William W. Burns, City Manager
Date: July 9, 1999
Subject: Franchise Fee Hearing
In preparation for Monday's public hearing on the franchise fees Bill Champa and I have identified
the following questions. Here are the questions and the answers that I intend to use. If you have other
questions that you think I need to address, please let me know.
1. Why do we need it?
We need it primarily to balance the General Fund budget. Since 1994, we have been responding
to the needs of Fridley residents by providing a variety of new programs and services. These
needs are primarily, but not exclusively, those of the most dependent segments of our population,
youth and older adults. We have also responded to needs that stem from our position as an older,
inner ring suburb with aging housing stock and public infrastructure.
As we create these new programs without raising new taates, we have become increasingly
dependent on use of our fund balances to balance the budget. The 1999 budget, for example, is
supported by $1.3 million in transfers from other funds. Our year 2000 budget provides for more
than $1.5 million in these transfers. While we have not always used as much of the transfer as we
have budgeted, we have been using substantial amounts of these funds each year.
Examples of these new expenditures include those associated with the hiring of three new police
officers in 1994, an additional two police officers in 1999 and one new police officer that is to be
hired next year. We have also added substantial additional local cost for Project Safety Net, and
various youth programs at our newly built Fridley Community Center. Then, there is the cost of
operating the Fridley Community Center. There are also significant, unfunded costs associated
with our rental inspection program, the maintenance of our highway corridors and with the pick
up of storm damaged tree limbs. And the list goes on a to include costs associated with the
revision of our comprehensive plan and other mandated costs.
In addition to covering new costs, however, we need the franchise fee to offset the impacts of
recent changes in property tax rates. We also need them as a supplement to historically flat state
aid revenues. In the first instance, our t� capacity in Fridley has dropped by more than twelve
percent over the past three legislative sessions as a result of reductions in commerciaUindustrial
property tax rates. While we have yet to be severely impacted by these changes due to the State's
use of budget surplus to buy down the education levies in our school districts, there is strong
potential that in less favorable times, cities will be faced with property tax reductions or,
alternatively, high residential property tax increases.
In the second instance, state aid revenues, we have over the last five to six years experienced
almost no real growth in Local Government Aid or HACA revenues. Since these sources of
revenue make up more than 28% of our total General Fund Revenue, this absence of growth
coupled with increases in costs, have also served to create the need for the franchise fees.
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The third major reason for the franchise fee is our expectation of future needs. These needs
include the need for new fire equipment to accommodate new development and redevelopment in
Fridley. There is also a future need for street lighting improvements and continued improvement
to Fridley's highway corridor maintenance program as well as a need for additional gymnasium
space for both youth and adult recreation programs. While the franchise fees will not buy our
response to all of these needs, it will along with what we expect will be improved profits from our
liquor operations give us some additionai flexibility to respond to our highest priority needs.
2. What will it cost me?
The franchise fee is applied as a user fee for residential utility customers. It will cost them an
additional 3%, or about $36 per year for the average consumer of these services. The
commerciaUindustrial customer will pay a flat rate for each customer account for which they are
billed. The smallest commercial/industrial utility users will pay about $3 per month or roughly the
same as the average residential user. The largest commercial/industrial customers will pay a
maximum of $300 per month or $3,600 per year. In general, residential customers will pay about
40% of the franchise fees; commercial/industrial customers will pay 60% of the fees.
3. Will seniors and low income residents be required to pay the franchise fee?
Yes they will. But, if they fall below federally defined poverty guidelines, they will be eligible to
apply for a rebate.
4. I understand that the franchise legislation contains limits or caps for commerciaVindustrial
customers, do these limits apply to the company as a whole or to each account ?
Since the commercial/industrial customers are assigned a flat fee rather than paying a percentage
of the bill, there are limits or caps that�protect smaller users in each category from exorbitant
franchise fees. The limits apply to utility accounts and not to the company as a whole.
5. When will the franchise fee go into effect?
If the franchise fee legislation is approved according to schedule, the first reading will occur on
July 26; the second and final reading would take place on August 9. Since there is a sixty-day
waiting period required by our franchises with the two utilities, the fees would go into effect
about mid-October.
6. Will the City earmark the money for particular uses?
Since the fees are needed primarily to pay for existing programs and services, they should be
reserved for General Fund use. By doing this, we should help preserve our fund balances for
specific capital improvement needs, such as streets and recreation facilities. Also, as a general
rule, I believe that our citizens are best served by maintaining fiznds that can be used to address
our needs on a priority basis. If they are earmarked, we become locked into purposes that may not
be the highest priority 2 to 3 years from now.
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7. Will the franchise fees be applied to schools?
Yes, they will be applied to public and private schools. I have asked the two utilities to calculate
the financial impacts for each of Fridley's public school systems. Those numbers may not be
available until Monday evening.
8. Has the City considered cutting expenses as an alternative to imposing the franchise fee?
Yes, but we did cut back expenditures by more than $1,000,000 as part of our 1996 budgeting
process. Even then, finding cuts was a challenge and subject to considerable controversy. Those
who were impacted by service cuts were very vocal in their opposition. If we were to cut back
today by a similar amount, it could not be done without cutting services that many people want us
to provide. There are no easy targets.
In addition to the cutbacks in 1996, we have also sought to maximize our use of grants and we
have sought to achieve economies of scale through joint ventures with other cities. Project Safety
Net, county-wide police records management, the joint operation of our fire training center and
our cooperative Geographic Information System programming with two other cities are examples
of these efforts.
And, we have sought to contract out services where that contracting out or outsourcing has been
cost-effective. Several years ago, we sought private sector quotes for equipment maintenance. In
that instance we found that outsourcing would have been considerably more expensive than our
current three mechanic operation. In other instances, such as the employment of contract building
inspectors, the outsourcing option has been more successful.
I would also point out that there are many differences between a private sector and a public sector
operation. The City provides services that are needed for the good of everyone rather than
products or services that are sold competitively in the marketplace. The need for our services is
not market driven and, unlike the private sector, we can not cut operating expenditures simply by
eliminating unprofitable products. We also do not enjoy access to the revenue raising and
expenditure cutting options that the private sector enjoys. Merger is not a realistic option anymore
than moving our operations to Mexico. Moreover, we do not have the freedom to invest in
equities and are much more severely restricted than the private sector in how we can raise
revenues. I also strongly suspect that we are much more restricted by specialization of our work
force than many private sector entities. As talented as he is, sending Bill Champa out to handle .
domestic disputes or to operate a backhoe would probably not work
9. Is there a sunset clause in the franchise fee ordinance that would force reconsideration of
the ordinance after a given period of time.
No, we have not included a sunset clause in this legislation. It seems very likely that the need for
this r�venue stream will continue indefinitely. Moreover, Council always has the option to
eliminate the franchise fee if they deem it desirable. I believe the record very clearly shows that
our Council has been very responsible in its property taxing decisions. Given the record, I think
Fridley residents can count on them to eliminate unnecessary taxes in the future.
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10. Doesn't the City have substantial fund balances? Why can't these be used rather than the
franchise fee revenues?
Fridley does have fund balances and we are finally healthy. We also enjoy a Aal bond rating and
woald like tc maintain that rating. While we could fill our revenue gap by using fund balances,
the fix is a short-term fix that will have serious negative consequences. As we draw down fund
balances �ve eliminate our ability to generate interest revenue. We also use up working capital
and elirninate money that has been put aside for capital improvement projects, particularly the
money reserved for street and parks improvements. Drawing down of fund balances will also
affect our bond rating and raise the cost of future borrowing. When the fund balance is gone, we
would be faced with the choice of drastic cuts in services or drastic property tax increases. By
resolving revenue shortfalls now, we avoid these extremes at a minimal cost to our citizenry.
11. Will you reduce property taxes to offset the impact of franchise fees?
If we see that franchise fees are bringing in more than expected or amounts that produce budget
surpluses, I would recommend cutting back property t�es rather than eliminating the franchise
fees. If we cut back property taxes now, however, we will have failed to address the needs that
generated the franchise fees.
12. Why propose the franchise fee rather than property tax increases?
The franchise fee is a sales tax and as such will help diversify the City tax base. The franchise fee
also has the advantage of being collected from all Fridley property. And, it is less painful in that it
is payable in small amounts (about $3 a month for the residential customer). The franchise fee is
also somewhat less expensive for the residential property owner than is a property tax increase.
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FRANCHISE FEE COMPARISONS
WITH OTHER CITIES
(May,1999)
C�
Blaine
Coon Rapids
Fridley (Proposed)
Minneapolis
Mounds View
C�
Blaine
Coon Rapids
Fridley (Proposed)
Minneapolis
Mounds View
Percents are of utility's gross revenues.
Minne�asco
Residential
136%
4%
3%
4.5%
2.5%
NSP
Residential
1.36%
4%
3%
5%
2.5%
����
Commercial
1.36%
4%
3%
5%
2.5%
Commercial
1.36°/a
4%
3%
5%
2.5%
Proposed Franchise Fee Summary
NORTHERN STATES POWER
fVl i N N EGASCO
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Description of Minnegasco Customer Rate Classifications
Residential: Residential customers that use gas for general household purposes in a space occupied
as a living unit, such as a single private residence, single flat or apartment with less
than five units, fraternity house, sorority house or rooming house.
CA Firm A Commercial and industrial customers with gas consumption less than 1,500 therms per
year. CA Firm A customers use gas in the conduct of a business enterprise in space
occupied and operated for commerce and/or manufacturing, processing, refining,
mining or fabricating.
C/I Firm B Commercial and industrial customers with gas consumption 1,500 to 4,999 therms
per year. C/I Firm B customers use gas in the conduct of a business enterprise in
space occupied and operated for commerce and/or manufacturing, processing,
refining, mining or fabricating.
C/I Firm C Commercial and industrial customers with gas consumption 5,000 therms or more
per year. C/I Firm C customers use gas in the conduct of a business enterprise in
space occupied and operated for commerce and/or manufacturing, processing,
refining, mining or fabricating.
Dual Fuel A Commercial and industrial customers with gas consumption less than 120,000 therms
per year. In addition, Dual Fuel A customers must maintain adequate standby facilities
and have available sufficient fuel supplies to maintain operations during periods of
curtailment. Dual Fuel A customers use gas in the conduct of a business enterprise in
space occupied and operated for commerce and/or manufacturing, processing,
refining, mining or fabricating.
Dual Fuel B Commercial and industrial customers with gas consumption 120,000 therms or more
per year. In addition, Dual Fuel B customers must maintain adequate standby facilities
and have available sufficient fuel supplies to maintain operations during periods of
curtailment. Dual Fuel B customers use gas in the conduct of a business enterprise in
space occupied and operated for commerce and/or manufacturing, processing,
refining, mining or fabricating.
LVDF Commercial and industrial customers with gas consumption 2,000 therms or more per
day. In addition, Large Volume Dual Fuel customers must maintain adequate standby
facilities and have available sufficient fuel supplies to maintain operations during
periods of curtailment. Large Volume Dual Fuel customers use gas in the conduct of a
business enterprise in space occupied and operated for commerce andlor
manufacturing, processing, refining, mining or fabrication.
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Northern States Power Company
Electric Utility
Definition of Customer Classifications
Residential
• Available to any customer for domestic purposes living in a single private residence, multiplex,
townhouse, condominium, etc.
Includes Standard, Time of Day and Underground rates.
Small Commercial & Industrial With No Demand Charge
• Available to any nonresidential customer for single or three phase non-demand metered electric service
where the maximum monthly demand requirement is less than 25 kilowatts.
• Includes Standard and Time of Day rates.
Smal[ Commercial & Industrial With Demand Charge
Available to any nonresidential customer for single or three phase demand metered etectric service where the
maximum,monthly demand requirement is less than 100 kilowatts.
Includes Standard, Time of Day and Controlled rates
Service voltage depends upon the proximity of the particular customer location to Company facilities
supplying alternating current at these voltage levels.
Secondary Level single or three phase at 208 volts (V) up to 2,400 V.
Primary Level - three phase at 2,400 V up to 69, 000 V.
Transmission Transformed Level - three phase from 2,400 V up to 69,000 V where service is provided at
NSP's disconnecting device at a distribution substation transformer
Transmission Level - three phrase at 69,000 V or higher.
Large Commercial & Industrial Witfi Demand Charge
• Available to any nonresidential customer for single or three phase demand metered electric service where
the maximum monthly demand requirement is 100 or more kilowatts.
Includes Standard, Time of Day and Controlled rates.
• Service voltage depends upon the proximity of the particular customer location to Company facilities
supplying alternating current at these voltage levels:
Secondary Level - single or three phase at 208 volts (V) up to 2,400 V.
Primary Level - three phase at 2,400 V up to 69, 000 V.
Transmission Transformed Level - three phase from 2,400 V up to 69,000 V where service is provided at
NSP's disconnecting device at a distribution substation transformer.
Transmission Level - three phrase at 69, 000 V or higher
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Public Street & Hi�hway Lightin,�
Available for year-round illumination of public streets, parkways and highways.
Customers are billed through multiple service accounts which include one or more individual lamps by type or
installation date.
Sales to Public Authorities (Municipals) With No Demand Char�e
Available to municipal owned water works and municipal sewage systems, for operation of pumping and
treatment plants, for single or three phase non-demand metered electric service, where the maximum monthly
demand requirement is less than 25 kilowatts.
Sales to Public Authorities (Municipals) With Demand Char�e
Available to municipal owned water works and municipal sewage systems, for operation of pumping and
treatment p(ants, for single OF three phase demand metered electric service.
Service voltage depends upon the Proximity of the particular customer location to Company facilities
supplying alternating current at these voltage levels:
Secondary Level - single or three phase at 208 volts (V) up to 2,400 V.
Primary Level - three phase at 2,400 V up to 69,000 V.
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� AGENDA ITEM
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CITY COUNCIL MEETING OF JULY 12, 1999
CRY OF
FRIDLEY
INFORMAL STATUS REPORTS
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