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CCM 04/28/2014 CITY COUNCIL MEETING CITY OF FRIDLEY APRIL 28, 2014 The City Council meeting for the City of Fridley was called to order by Mayor Lund at 7:00 p.m. ROLL CALL: MEMBERS PRESENT: Mayor Lund Councilmember Barnette Councilmember Varichak Councilmember Saefke Councilmember Bolkcom OTHERS PRESENT: Julie Jones, City Planner James Kosluchar, Public Works Director Don Abbott, Director of Public Safety Deb Skogen, City Clerk Wally Wysopal, City Manager Darcy Erickson, City Attorney Michael Schrauth,Broadway Bar and Pizza Amanda Jackson, Spring Lake Park Lions Bradley Sielaff, Fridley Lions Steve Linder,Spring Lake Park Lions Jim Glazer, 16 Rice Creek Way APPROVAL OF PROPOSED CONSENT AGENDA: APPROVAL OF MINUTES: City Council Meeting of April 14, 2014 APPROVED. OLD BUSINESS: 1. Second Reading of an Ordinance Amending Fridley City Charter, Chapter 3, Procedure of Council, Section 3.03, rules of Quorum and Procedure; Section 3.04, Ordinances, Resolutions and Motions; Section 3.05, Procedures on Ordinances; and Section 3.07, Signing, Publication and Retention of Ordinances, Resolutions and Motions. WAIVED THE READING OF THE ORDINANCE AND ADOPTED ORDINANCE NO. 1314 ON SECOND READING AND ORDERED PUBLICATION. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 2 2. Second Reading of an Ordinance of the City of Fridley, Minnesota, Amending City Ordinance No. 1095, the Prevailing Hours of Labor and Prevailing Wage Rate on Certain Projects for or With the City. THIS ITEM WAS REMOVED FROM THE CONSENT AGENDA AND PLACED ON THE REGULAR AGENDA. 3. Receive the Minutes from the Planning Commission Meeting of April 16, 2014. Councilmember Varichak stated page 20 should read, "Chairperson Kondrick called the Planning Commission meeting to order at 7:00 p.m." RECEIVED AS CORRECTED. 4. Special Use Permit Request, SP #14-02, by Schmidt Osborne, LLC, to Expand their Existing Outdoor Storage Area, Generally Located at 100 Osborne Road, and Resolution Approving Special Use Permit, SP #14-02, for Schmidt Osborne, LLC, the Property Owner for the Property Located at 100 Osborne Road N.E. (Ward 3). Wally Wysopal, City Manager, stated on Exhibit B to the Resolution, Stipulation No. 1 should say Exhibit C rather than Exhibit B. APPROVED SPECIAL USE PERMIT, SP #14-02, AND ADOPTED RESOLUTION NO. 2014-35 AS CORRECTED. 5. Resolution Supporting an Application for LCDA Tax Based Revitalization Account Grant Funds for 5300 Central Avenue N.E.; and Resolution Approving a DEED Contamination Cleanup Grant Application for 5300 Central Avenue (Ward 1). Mr. Wysopal asked that this item be removed. THIS ITEM WAS REMOVED. 6. Receive Bids and Award the Alternate Bid for the 2014 Street Improvement Project No. ST. 2014-01. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 3 Mr. Wysopal stated staff recommends the City Council move to receive the bids and award the alternate bid to Astech Corporation in the amount of $1,506,453.48. APPROVED. 7. Appointment - City Employees Mr. Wysopal stated there are three positions: Gary Buhlman, Sewer Lead person; Jason Wiehle, Lead Water person; and Andrew Todd, Police Inspector. Mayor Lund stated two existing members of the City’s Public Works staff are going into new positions. Is the City going to be filling their positions? Mr. Wysopal replied the City will not be. Those are positions created through the restructuring of the Public Works Department. They will be serving as lead positions, one within the Water Division and one within the Sewer Division. APPROVED. 8. Claims (163576 - 163731); 1404 (ACH Pcard) APPROVED. 9. Licenses. APPROVED THE LICENSES AS SUBMITTED AND AS ON FILE. 10. Estimate Sunram Construction 20010 - 75th Avenue N.E. Corcoran, MN 55340 Main Street Bike/Walk Project No. ST2011-22 Estimate No. 1.............................................................$ 1,843.38 APPROVED. APPROVAL OF CONSENT AGENDA: Councilmember Barnette asked that Item Nos. 2 and 5 be removed. MOTION by Councilmember Barnette to approve the proposed consent agenda with the removal of Item Nos. 2 and 5. Seconded by Councilmember Varichak. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 4 ADOPTION OF THE AGENDA: MOTION by Councilmember Bolkcom to approve the agenda with the addition of Item No. 2. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. OPEN FORUM: No one from the audience spoke. OLD BUSINESS 11. First Reading of an Ordinance Amending Fridley City Code, Chapter 28, Carnivals (Continued April 14, 2014). Debra A. Skogen , City Clerk, stated a review of Chapter 28 found there was no general liability insurance requirement to operate a carnival in the City. A small cash deposit of $200 was required for cleanup of the mechanical ride section of the carnival. There is no indemnification holding the City harmless against any health claims that might arise from the operation of the carnival. After reviewing the requirements from other cities, staff proposed the following changes: • Create a definition to what a carnival consists of and where it can be located. Staff has shortened the definition so that it is mechanical amusement rides or other mechanical devices and included circuses. • Changing the word, "premises" to "private or public property" throughout the chapter so that it is consistent. • Requiring the property owner to provide an acknowledgment of the use of property as part of the license application, allowing the City to set conditions for a carnival license. It would require comprehensive general liability coverage to protect the City and the licensee against liability for injuries or damages. This insurance coverage would be provided by the carnival itself, and it would require the licensee to obtain and maintain workers' compensation required by applicable Minnesota Statute. It would also require the certificate of insurance name the City as an additional insured on the certificate. • A cash deposit of $200 is being increased to $3,000 for the operation, removal, and cleanup of the mechanical amusement ride area. Cash bond is returned after completion of proper cleanup of the premises and removal of the carnival operation. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 5 • An indemnification agreement provided to the City prior to the issuance of a license requiring the licensee to defend and hold harmless the City from any and all claims. That form will be about a two-page form, very short, and would be for the carnival operator. Ms. Skogen stated staff recommends a motion holding the first reading of this ordinance. Councilmember Bolkcom asked if there is a reason they indicate only "outdoor event". What if the carnival is indoors? Ms. Skogen replied staff tied it outdoor event mechanical amusement rides, because if a school were to have it, they most likely will not have mechanical rides. Councilmember Bolkcom asked, what about a circus? Ms. Skogen replied staff tried to tie it to outdoors. Councilmember Bolkcom replied why? Ms. Skogen replied part of that was because of some of the questions that were raised about carnivals. They thought about exempting schools, but then they started talking about churches and some other things and thought they would just shorten the definition. Councilmember Bolkcom stated at the bottom of the first page of the resolution, the word "or" should not be there. Darcy Erickson , City Attorney, stated the word should be replaced with "and" to show there is a serial list of requirements. MOTION by Councilmember Saefke to waive the reading of the ordinance and adopt the ordinance on first reading. Seconded by Councilmember Bolkcom. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. NEW BUSINESS: 12. Resolution Waiving Requirement for Non-Qualifying Organization and Supporting the Application for a Minnesota Lawful Gambling Premises Permit for Spring Lake Park Lions at Broadway Bar and Pizza, Located at 8298 University Avenue N.E. (Ward 3). Mayor Lund removed himself from this item as he has personal interest being a member of the Fridley Lions Club. He handed over the chair to Mayor Pro Tem Robert Barnette. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 6 Deb Skogen, City Clerk, said Minnesota state law requires lawful gambling organizations to apply for a State premise permit and obtain a resolution of support from the City they will be conducting the business in. The City received a premise permit application from the Spring Lake Park Lions for Broadway Bar and Pizza. The Spring Lake Park Youth Hockey was previously conducting lawful gambling at Broadway Bar and Pizza, but their lease agreement ends at the end of April. Ms. Skogen stated Fridley City Code, Sec. 603.25.2.E, requires an establishment to seek a qualifying organization. Section 30.01.1.B defines a qualifying organization as one having a third of its membership residing in the City or one having a principal office or business in the City for a continuing period of at least one year. If an establishment is unsuccessful at locating a qualified organization, they shall attest to that fact on their liquor license application. City Council may waive this requirement for a non-qualifying organization. Ms. Skogen stated Broadway Bar and Pizza interviewed five organizations, two of whom are qualified organizations. They interviewed the Fridley American Legion, Fridley Lions, Spring Lake Park Lions, Minnesota Youth Athletic Services, and the St. Paul Firefighters. After meeting with the five organizations, Broadway Bar and Pizza determined the Spring Lake Park Lions was the best fit for their establishment. Ms. Skogen stated the Spring Lake Park Lions recently conducted lawful gambling at the Shorewood Restaurant until it closed April 3. Broadway Bar and Pizza and Spring Lake Park Lions are asking the City to grant a waiver allowing them to conduct lawful gambling in Fridley for a non-qualifying organization. Ms. Skogen stated staff contacted the Minnesota Gambling Control Board and found there are no outstanding issues, no open investigations, and no compliance issues or citations. Therefore, staff recommends the City Council discuss the proposed waiver with the Spring Lake Park Lions and Broadway Bar and Pizza. If the City Council agrees to a waiver, adoption of the resolution in support of the premise permit would be in order. Councilmember Bolkcom asked if there are charitable organization applicants in the community who qualify. Ms. Skogen replied yes. Councilmember Bolkcom asked the owner of Broadway Bar and Pizza, to explain the second paragraph of his letter: "We are asking that a portion of their donations be presented to a Fridley organization, to benefit the community operated in." Michael Schrauth, Broadway Bar and Pizza, said he provided the City with additional information. The business had been in the community long enough to know the community supports the restaurant. By having the restaurant support the communities, they in turn gain business, revenues, etc. They would like the organization they choose to give back to the community. The Spring Lake Park Lions seem to have done that in the past to specific Fridley FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 7 organizations, and he felt they were a good choice. He felt some of the other organizations had not been as successful. Councilmember Bolkcom asked how he knew that. She asked if they asked the candidate how much they made on their charitable gambling. Mr. Schrauth replied the charitable gambling is a matter of public record. Councilmember Bolkcom asked if they made that part of their decision. Mr. Schrauth replied, yes. Councilmember Bolkcom stated it is hard for her to waive this when there is an organization that resides in their community. If she remembers the discussion back when they made the decision as to how they do things, if there was no organization that was in Fridley that met the qualifications, then they had an avenue to waive it so they could have an outside organization. She feels once they waive this, what would prevent another eating establishment from wanting it waived. It seems there are good candidates in Fridley. Mr. Schrauth replied he was not going to tell her the candidates are insufficient or bad. He is asking because he thinks the organization they choose will do the best job. They demonstrated some points of difference. They are operating across the street from Spring Lake Park. The organization has a good handle and understanding of the kinds of needs their guests have because they draw from the same community. They also perform very well in the charitable gambling arena. They bring in things that are not the usual forms of gambling. Their bingo is successful because they are doing innovative and interesting things. He feels the participation they have been able to draw will help his restaurant. Councilmember Bolkcom asked if it would do the opposite once people knew they were not supporting the Fridley Lions. Mr. Schrauth replied he thinks they will find there are enough organizations in Fridley that are being benefited by donations from the Spring Lake Park Lions. He referred to a letter listing organizations the Spring Lake Park Lions are directly donating to. Councilmember Bolkcom asked if during their interview process, they went back to the Fridley Lions and asked them how they could do things different. Mr. Schrauth replied there was a lot to be said about the presentation that was made and what their interests were. However, he did have a good lengthy conversation on the telephone with an active member of the Fridley Lions. It was important for the Fridley Lions to understand what they are doing right now that is successful and compare that to what the Spring Lake Park Lions are doing right now that is successful and determine if they can transfer those successes to their business. The long-term effect and the biggest interest of his establishment are the revenues. The underlying factor is whether the community and the organizations that have needs are being helped by the Spring Lake Park Lions, who has demonstrated that in the past. If you concentrate FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 8 on those kinds of things, the revenues will come, because you want those people to come. The Spring Lake Park Lions are donating to different community organizations in Fridley and are operating at a Fridley restaurant. The community does benefit. Councilmember Bolkcom asked Mr. Schrauth if people came to his establishment because of the food and the atmosphere. Does he think a huge draw would be the different types of gambling that takes place? Mr. Schrauth replied by and large 90 percent of the people are coming there for food. There may be some who just have an interest in the gambling. He would like to retain the food business they have and expand in some other areas. He has had mild success with the charitable gambling operations that have operated there. Councilmember Bolkcom asked if he felt people would stay around longer because they would participate in some new gambling opportunity. Mr. Schrauth replied, yes. In some cases, they come for the gambling opportunities. MOTION to receive a letter from Amanda Jackson of the Spring Lake Park Lions dated April 28, 2014. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, WITH THE MAYOR ABSTAINING, MAYOR PRO TEM BARNETTE DECLARED THE MOTION CARRIED UNANIMOUSLY. Councilmember Barnette stated he was on the Council when they agreed to pass the ordinance, and there was a lot of emphasis at that time to benefit Fridley organizations, i.e., VFW, American Legion. He is a little bit leery of a waiver, as long as there were some other Fridley organizations that were involved in this. There were at least two. He would like to hear a little more from the Fridley organizations as well. He asked Mr. Schrauth whether they interviewed both the American Legion and the Lions. Mr. Schrauth replied, yes. There were also organizations that were outside the Fridley area. Councilmember Bolkcom asked Amanda Jackson to summarize her letter. Amanda Jackson, Spring Lake Park Lions, stated she has been the gambling manager at the Spring Lake Park Lions for not quite a year. During that time, they were operating out of the Shorewood in Fridley and they had good rapport with them. They are asking the City to consider the Spring Lake Park Lions. Councilmember Bolkcom stated the manager from Broadway Bar and Pizza is asking that a portion of the donations be presented to a Fridley organization to benefit the community it is operated in. Is there a percentage that has been discussed? FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 9 Ms. Jackson replied they have not discussed any figures or amounts. She did bring to his attention all of the money that Spring Lake Park Lions has donated directly to Fridley. She said some of the donations in 2012 and 2013 were to the Fridley '49ers; $1,000 to the Anoka County Library, Fridley Branch on Mississippi; $1,000 to Lee Carlson Center; three times to the Meals on Wheels in Fridley and also to the Springbrook Nature Center. They are also big supporters in District 16, and about 1,450 students from District 16 are Fridley residents. Councilmember Bolkcom asked Ms. Jackson if she meant scholarships. Ms. Jackson replied various different scholarships (they have a scholarship fund), they donate to the robotics team, and community ed. The list of what they donate to the school is very long. Councilmember Bolkcom asked if all that money was coming from their gambling profits. Ms. Jackson replied yes. Everything listed is from their lawful gambling proceeds. Councilmember Bolkcom stated but, again, like the $1,000 to CEAP, they are not just for Fridley. It is for surrounding communities such as Columbia Heights. Ms. Jackson replied, they donated $5,000 to SACA which is exclusive to Spring Lake Park, Fridley, and Columbia Heights. Bradley Sielaff , Fridley Lions, stated he is gambling manger for the Fridley Lions; and they are a qualified organization. He does not understand how a non-qualifying organization can get a permit ahead of a qualifying organization. He has a charitable gambling report from 2013 which goes to the legislature that is issued by the Gambling Control Board. MOTION by Councilmember Bolkcomto receive the 2013 Lawful Charitable Gambling Report from Bradley Sielaff. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, WITH THE MAYOR ABSTAINING, MAYOR PRO TEM BARNETTE DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Sielaff compared the Fridley Lions and the Spring Lake Park Lions. The important part of lawful purpose expenditures shows the amount of money donated to charitable causes, the percentage of everything that goes to charitable causes and what taxes are paid. Lawful purpose expenditures are charitable donations plus taxes. For the Fridley Lions, 52 percent has gone to lawful purpose expenditures. Under charitable giving the Fridley Lions donated $218,000 in the fiscal year starting in July 2012 to June 2013. They have contributed more than 50 percent of that just inside Fridley alone. Fridley Lions has donated more to Fridley than Spring Lake Park Lions has donated in total. They are committed to Fridley and spend a lot of money in Fridley. Councilmember Bolkcom asked Mr. Sielaff to tell them some examples. Mr. Sielaff stated they give outside Fridley, too. They give a lot of money to Anoka County. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 10 They give a lot of money to the Fridley School Foundation, Youth in Government. They donated $20,000 in this fiscal year to Springbrook Nature Center. They donate to the City of Fridley for Winterfest, Safety Camp, and also to Fridley '49er Days. They gave out $40,000 last year in scholarships which were distributed to all Fridley residents, even a few outside the Fridley School District. They donated money to Fridley Women of Today, the Historical Society, Athletic Fridley Youth Sports Association, Wrestling Boosters, swimming teams, community theater, and Stevenson Elementary and Hayes Elementary carnivals. Councilmember Bolkcom asked Mr. Sielaff whether he was part of the interview team. Mr. Sielaff replied, yes, he interviewed with the general manager, but only after he found out from one of the members. He was interviewed at the end. Councilmember Bolkcom asked Mr. Sielaff whether he was aware that every year they are supposed to let the City Clerk know the Fridley Lions is qualified and available. Mr. Sielaff replied he did not. He thought they were. They are now on a list to be notified. Councilmember Saefke stated the way he read the ordinance, he did not see it as an option for the owner to pick and choose if there is a qualified community organization that has a gambling permit. It would only apply if there were no qualifying organizations, but that was not the case here. Mr. Sielaff stated he was really concerned about providing a waiver because it would be precedent setting. Any organization could then come in and take on a gambling operation. Councilmember Varichak stated she agreed that if there were no Fridley organizations interested then they would go with a waiver. Mr. Sielaff stated he understood that is what happened at Shorewood because they left the site, and he thought the American Legion decided not to go there. Steve Linder, President and CEO of the Spring Lake Park Lions and also the gambling manager of the Fridley American Legion, said he interviewed with Travis from Broadway Bar and Pizza. They talked about the different organizations that applied and interviewed. If he were an owner of a business in Fridley, he would also look at the track record of the different organizations, what they have accomplished, and what new things they have done in the community. Spring Lake Park Lions has added eTabs, and Coach Bingo, where they give a Coach purse away. They have averaged 300 people per session for that. He said he did tell Travis the Fridley American Legion is a good organization, but he thinks the Spring Lake Park Lions has a better program. Ms. Jackson has done a great job in the year she has been with the Spring Lake Park Lions. He said if an organization drops two businesses in a year because they were not making enough money, that is a problem. The Spring Lake Park Lions got out of Shorewood because the restaurant closed. The Spring Lake Parks Lions are looking to make more money to give back to both Spring Lake Park and Fridley. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 11 Councilmember Bolkcom asked Mr. Linder if he could explain the difference in the percentages on the charitable gambling report. Mr. Linder replied he cannot. Ms. Jackson could. Ms. Jackson stated the difference in their expenses is because they have full-time office staff. Her full-time job is strictly to be a gambling manager. They also have a full-time assistant gambling manager. That is how they have been able to come up with some different types of events and put a lot of time and effort into planning them, because it is their job. The other things they are doing, which are costly but worthwhile, is they use a point of sales system with computers. If their pull tab sellers need any help, if they are struggling with computer problems, there is one of them always on call who can help. They have surveillance systems they can access from their iPhones. They are just a little bit ahead of charitable gambling, and that does take some expense that others have not taken on. They also have an office and a warehouse in the back they rent every month. Councilmember Bolkcom asked Ms. Jackson about the charitable percentages and what is given back. Ms. Jackson replied, right now they made $108,000 profit for last year. They have given away $78,000 with a good chunk of money to give eventually. All the money they make they give back to the communities. They do have money which they hold onto because it is a hard business. Sometimes you lose $20,000 in a month. They are always prepared if they have 2, 4, 6 bad months where they are not making any money. Councilmember Bolkcom stated but she sees a big difference between the Fridley Lions and the Spring Lake Park Lions as far as the money that is actually going back into the community. Ms. Jackson stated, when they operated out of the Shorewood, it was not a No. 1 site. They never came out ahead. They were able to pack the place and had bingo players playing on the floor. Maybe they did not make a profit there but they certainly tried. However, they did help the bar and also brought in tax money. Councilmember Bolkcom stated she is still having a hard time trying to figure out why the City Council should waive the restriction. There are two organizations in Fridley who fit the criteria. Ms. Jackson replied she applied twice for a permit at the Shorewood. Not an issue was brought up to get them into the Shorewood because the Fridley organizations did not want it. Now they have a bar owner who wants their organization and wants to implement some of the new things they are doing that their competitors are not doing. If the Fridley Lions wanted all of the sites including the sites that are not generating money, then she can see it. She did not think it would be an issue. That is why she approached Broadway Bar and Pizza. Mr. Schrauth stated he understood the spirit of not issuing the waiver and setting a precedent, and he understands the spirit of the legislation the City passed. However, as an owner of a business trying to be successful in a tough world and environment, there are a number of things FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 12 coming up such as the minimum wage, the need for insurance, the increased costs of product, all take their toll. His interest is to survive and improve his business. If the City wants to make this kind of legislation, the City should offer more organizational choices than just two when deciding who is qualified before it offers a waiver. Councilmember Bolkcom stated first of all, the City does not have bars. It just has restaurants with intoxicating beverages licenses. The City has existed like this for a very long time. The City has fewer restaurants. Some of them are gone. She asked Mr. Schrauth whether he could not work with the charitable manager for the Fridley Lions and do some of those same innovative things that are out there. Mr. Schrauth replied they would prefer someone who had demonstrated their ability to do this already. He was not an expert, and he is not the one who comes up with the ideas. That is why it is nice to have a full-time manager overseeing those kinds of things, making it profitable for themselves and generating more business. Councilmember Bolkcom stated it is hard for her to look at the charitable percentages that went back to her community from one organization versus the other one. If Mr. Schrauth came back to them in a year and said, it is just not working, she could maybe see having a waiver. Mr. Schrauth stated as to the allowable expenses, the $362,000, multiplying that times two is where you come into the $700,000. The difference between the two looks to be $300,000; and the difference between the charitable giving, the $508,000 versus the $388,000 is about $112,000. This is interesting to him because the allowable expenses are dictated by the State. It looks like the Fridley Lions operates more efficiently as they have less allowable expenses; however, some of them are things that are happening that are good today. They may be paying higher wages to their people who are working in operations, etc. Maybe you can be more efficient and give more money, but there are other things that need to be looked at, too. Councilmember Bolkcom replied she is only looking at the bottom line. Councilmember Saefke stated Mr. Schrauth’s primary purpose there was as a restaurant, not a gambling establishment. Gambling is a privilege the State grants through the City ordinance. It was not written so an owner can pick and choose who it wants. The City made this ordinance so its local organizations can get first bid. One of the reasons it exists the way it does is because other communities excluded Fridley's organizations from even attempting to do gambling within their communities. Mr. Schrauth's business would not depend upon pull tabs or bingo, it would depend upon his service and quality of food. Costs will go up and he is sure Mr. Schrauth will pass those on to his customers in order to operate and provide himself a net profit so he can stay in business. Jim Glazer , 16 Rice Creek Way, stated he is a member of the Fridley Lions. He asked Mr. Schrauth if he ever looked at the percentages for the previous charitable gambling organization. Also, did Mr. Schrauth ever ask the people to perform better? Can Spring Park Lake Lions double the rent or pay him more money? Did Mr. Schrauth he have a problem with the other people because of poor performance. He asked if Mr. Schrauth could explain why they left. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 13 Mr. Schrauth replied it is his understanding the Spring Lake Youth Hockey had a number of losses of businesses. There is a connected restaurant, the Shorewood operation they were in, which was their most successful operation. There was Nicklow’s. They were maintaining their business there. It is not his intent to think that another operation is just going to come in and do the same. That is the reason they chose Spring Lake Park Lions because they thought they would be successful. Councilmember Bolkcom said she would like to make a motion to continue this item until the next meeting so they can review the minutes from when they added the waiver and also have a discussion and a findings of fact. MOTION by Councilmember Bolkcom to continue the Resolution Waiving Requirement for Non-Qualifying Organization and Supporting the Application for a Minnesota Lawful Gambling Premises Permit for Spring Lake Park Lions at Broadway Bar and Pizza, Located at 8298 University Avenue N.E. to the May 12, 2014, City Council meeting. Seconded by Saefke. UPON A VOICE VOTE, ALL VOTING AYE, WITH THE MAYOR ABSTAINING, MAYOR PRO TEM BARNETTE DECLARED THE MOTION CARRIED UNANIMOUSLY. 13. Vacation Request, SAV #14-02, by Trident Development, LLC, to Vacate the East Half of University Avenue Service Drive, South of 61st Avenue, to Allow for the Redevelopment of the Properties Commonly Referred to as Gateway NE, Now Being Called Gateway Commons; and Resolution Vacating the East Half of the University Avenue Service Drive, Formerly Known as State Street to Allow for the Redevelopment of the Gateway Commons Properties, Generally Located at 5831, 5865, 5895, 5905, 5925, 5943, 6005, 6041, 6061 and 6071 University Avenue NE, Petitioned by Trident Development, LLC, and the City of Fridley's Housing and Redevelopment Authority (Ward 1). Julie Jones, Planning Manager, stated the petitioner is requesting a preliminary plat to allow redevelopment of the “Gateway Commons” properties located between 5831 and 6071 University Avenue, for the Cielo Apartment Development. Ms. Jones stated for the purposes of financing the new buildings, there needs to be separately platted parcels for each building. To achieve the redevelopment according to the approved Master Plan, the east half of the University Avenue Service Road needs to be vacated as well as a series of easements, including street, utility, drainage and sidewalk that exist on the property today. New drainage and utility easements will be dedicated as part of the plat requested for “Gateway Commons”. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 14 Ms. Jones stated the project will include 3 buildings, with the Phase I building starting on the st corner of University Avenue and 61 Avenue. The Phase II and Phase III buildings will continue south on the remaining properties. Ms. Jones stated the entire apartment community will have 259 apartment units within the 3 buildings and each building will be 4 stories, with 3 stories of living space above indoor, ground- level parking. Ms. Jones stated the plat will combine 42 small lots into 3 larger lots, for each building proposed to be built as part of this development. The lots will be legally described as: Lot 1A, Lot 1B, Lot 1C, Lot 2A, Lot 2B, Lot 2C, and Lots 3A and 3B, Block 1, Gateway Commons. Ms. Jones stated the reason that Lots 1, 2 and 3 are split into A, B, and C is because some of the land to be replatted is Torrens property while other portions of it are Abstract. Anoka County’s Examiner of Titles does not allow the combination of these different types of property. The City will require that all of the lots encumbered in Lots 1, 2 and 3 be combined for tax purposes so that an individual lot cannot be sold separately. Ms. Jones stated the road through the development will be privately owned and maintained. It st will be accessed from the University Avenue Service Drive (south), 61 Avenue (north) and by th 60 Avenue with a round-about. The round-about will be constructed to City standards, but will be privately constructed and maintained. Ms. Jones stated the east one-half of the University Avenue Service Road (formerly State Street) needs to be vacated. Once vacated, the land will be turned over to the existing property owner, the Fridley HRA. The HRA is in the process of negotiating the purchase of the land currently with the petitioner. Ms. Jones stated the remaining half of the University Avenue Service Road that will not be vacated will provide adequate space for the construction of a new sidewalk and the extension of ornamental fence that currently exists along other portions of University Avenue. Both of which will be constructed by the petitioner to standards approved by the City and Mn/DOT. Ms. Jones stated there are also a series of easements, (street, utility, drainage and sidewalk) that need to be vacated for the project. The new plat of “Gateway Commons” will dedicate the necessary easements for right-of-way, grading, drainage and utility. Ms. Jones stated at the April 16, 2014, Planning Commission meeting, a public hearing was held for Street Vacation, SAV #14-02; Easement Vacation, SAV #14-03; and Plat, PS #14-03. All requests were unanimously approved. Ms. Jones stated City staff recommends concurrence with the Planning Commission on approval of street vacation request, SAV #14-02 and the accompanying resolution, and approval of easement vacation request, SAV #14-03 and the accompanying resolution. Staff recommends approval of Plat, #14-03, with one stipulation: The petitioner shall combine all lots encumbered in Lots 1, 2 and 3 prior to issuance of a building permit. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 15 Councilmember Barnette asked, in putting in the service road back to service the garages, that will extend past 60th Avenue. Roger Fink, Trident Development LLC, replied he believed that is correct. Councilmember Barnette stated when you reach the current buildings that are done there, they have access on what is now the current service road. Can you go into their property from the petitioner's property? For example, if someone is leaving for work and they have to go out to 61st, they go to 4th Street. Can you access into that property or is it going to be a cul de sac? Mr. Fink replied the plan calls for continued ability for their property to connect to and access the property to the south and vice versa. That connection will remain as it does now. They are just going to redirect the service road so it bends further to the east. Councilmember Barnette stated so people living in those apartments could go up there and go st over to 60th and up to 4th Street or continue all the way to 61. Mr. Fink replied they can. In working with City staff about this entire traffic design, they decided they will place signage at the entrance of their property notifying drivers they are entering private property and they are providing a turnaround space should they decide they are going the wrong way. Finally, it has been recommended by staff that signage be placed out on 57th notifying that turning off 57th and heading into the north there is not a "thru" street. Councilmember Bolkcom stated in the minutes from the Planning Commission meeting, there is a question about when the roadway will be finished. Ms. Jones replied it is her understanding the private drive through the entire development will be completed with Phase I. th Mr. Fink replied his recollection is with Phase I they would make the connection to 60 Avenue, the roundabout. The extension further to the south to connect with the existing roadway probably would not occur until a future phase. Councilmember Bolkcom asked Ms. Jones to summarize some of the questions that were raised during the Planning Commission meeting. There were concerns about the traffic and that people might try and go through this development and vice versa, to try to find their way out of the neighborhood. Ms. Jones replied, there were three points the gentleman brought up. One of his concerns was if people wanted to get out of this new development on 6lst, there would be too much of a backup. Instead they would want to go south. Mr. Fink's explanation of how the development is going to occur as far as that private road only going up to the point of the roundabout is helpful, because when the first phase takes occupancy, those residents are not going to have the opportunity to go south and connect directly to 57th. People have established their habit on the route they take and, if they find the backup is too great on 61st, then they will take the roundabout exit out to 60th; and they can get out on 4th Street onto 61st that way. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 16 Councilmember Saefke stated there is a typo on the second line of the Resolution title, page 84, it says "Knows" and should say "Known". MOTION by Councilmember Saefke to approve Vacation Request, SAV #14-02, by Trident Development, LLC, and adopt Resolution No. 2014-36. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY 14. Vacation Request, SAV #14-03, by Trident Development, LLC, to Vacate a Series of Easements (Including Street, Utility, Drainage and Sidewalk), to Allow the Redevelopment for the Gateway Commons Project, Generally Located on the East Side of University Avenue, South of 61st Avenue; and Resolution to Vacate a Series of Easements to Allow for the Redevelopment of the Gateway Commons Properties, Generally Located at 5831, 5865, 5895, 5905, 5625, 5943, 6005, 6041, 6061 and 6071 University Avenue NE, Petitioned by Trident Development, LLC, and the City of Fridley's Housing and Redevelopment Authority (Ward 1). MOTION by Councilmember Saefke to approve Vacation Request, SAV #14-03, by Trident Development, LLC, and adopt Resolution No. 2014-37. Seconded by Councilmember Bolkcom. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 15. Preliminary Plat Request, PS #14-03, by Trident Development, LLC, to Allow for the Redevelopment of the Properties Generally Located on the East Side of University Avenue, South of 61st Avenue. The Proposed Development will Allow the Construction of Three Multi-Family/Senior Apartment Buildings, to be Called Gateway Commons (Ward 1). MOTION by Councilmember Saefke to approve Preliminary Plat Request, PS #14-03, by Trident Development, LLC, with the following stipulation: 1.The petitioner shall combine all lots encumbered in Lots 1, 2, and 3 prior to issuance of a building permit. Seconded by Councilmember Bolkcom. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 17 16. Approve Agreement for School Resource Officer between the City of Fridley and Northeast Metro 916 Intermediate School District. Don Abbott, Director of Public Safety, stated this is the contractual arrangement to provide a Fridley Police school resource officer to Northeast Metro Intermediate School District 916 for their Metro Heights Academy Alternative Learning Center. District 916 relocated their northeast metro alternative learning center (ALC), known as the Metro Heights Academy, to Fridley from Columbia Heights in the fall of 2013. Most of the students are from the Columbia Heights and Spring Lake Park school districts which include a significant number of students residing in Fridley. Chief Abbott stated Metro Heights Academy is located at 7122 University Avenue NE in the south end of the building housing Two Stooges to the north. Chief Abbott stated Metro Heights Academy is anticipating an enrollment of approximately 100 students for the 2014-2015 term. They currently have approximately 60 students at this time. Chief Abbott stated 916 staff approached the Police Department in December and requested a school resource officer to begin as soon as possible. The Police Department advised them the fall of 2014 would be the earliest they would be able to supply one. The ALC had a full-time SRO from the Columbia Heights Police Department when they were located there. Chief Abbott stated both 916 and the Fridley Police Department recognize the benefits of having a police officer assigned to ALC environments to maintain a safe learning environment, provide valuable resources to the school staff, foster positive relationships with youth, and develop strategies to resolve problems so staff can teach and students can learn. Chief Abbott stated 916 requested a full-time SRO to begin in the fall term of 2014, and 916 will cover 80 percent of the cost of the SRO on an annual basis over the next three years. The SRO will work at Metro Heights during the school year and will be assigned to patrol and detective duties as needed during the summer months. Chief Abbott stated under the term of the contract, the City will provide an experienced SRO to Metro Heights from its current staff. The Police Department would then hire a new police officer to fill the resulting vacancy in whatever division the SRO would come from. Chief Abbott stated the Police Department is establishing an eligibility list for new officers at this time for two other openings. This position would be filled from that new list. Chief Abbott stated the contract does include a six-month cancellation clause that can be exercised by either party. As to the terms of the agreement, in 2014 for the remainder of the year the City estimates (without knowing who the actual officer will be assigned), would be around $39,100. Revenue from District 916 would be $31,280. Chief Abbott stated the cost of a replacement officer for that time, including salary/benefits/supplies/training, is estimated at $40,930. The impact for this year is estimated at a net cost to the City of $9,650. For 2015, the salary and benefits for the SRO officer go up to FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 18 $121,150; 80 percent would be $96,920 as revenue from 916. The cost of the replacement officer would be $87,920, with an additional $9,000 leftover covering the new officer's salary. Chief Abbott stated in 2016, the figures are $126,538 for the new officer; $101,230 revenue from 916; and $100,450 for the replacement officer. Finally, the portion of the school year in 2017 the cost for the SRO is $66,113; $52,890 as revenue from 916; replacement officer, $52,485; leaving $405 leftover. Therefore, the costs fairly well cancel out over the three-year contract. The budget impact to the City's general fund is almost negligible at that point. Chief Abbott stated the City Attorney has reviewed and approved the agreement. District 916 has had the agreement for several days. They will be bringing this to their board meeting on May 6 for approval. Once those approvals occur, the Police Department would be ready to work with the 916 School District, select one of its existing staff members who has SRO experience to be assigned, doing so most likely for the duration of this three-year contract, and would like to be able to have the assigned SRO spend a little bit of time at 916 this spring before school is out before they are assigned to the three-year term starting in the fall. Chief Abbott stated staff recommends approval of the contract. They feel it is a good thing for the City to have an officer in that environment, and so does 916. Councilmember Bolkcom asked on page 115, 3.2.3, what does it mean, "by frequently visiting high-delinquency areas for law violators; and by observing matters. . . ."? Chief Abbott replied in the area around the ALC, it is possible a student could be truant or friends may want to come to try and visit the student or pick the student up after school or drop them off before school. What they are saying is the SRO has the ability to leave the building and patrol the nearby area which would include Community Park and some of the streets and the other business parking lots. Councilmember Bolkcom asked if most of the kids were bused to school. Chief Abbott replied they are primarily from the two school districts of Spring Lake Park and Columbia Heights. Other students from outside those districts come in on a contract basis. He said he was not sure how their transportation was arranged. Councilmember Bolkcom stated there are no parking issues, as the students do not drive to school. . Chief Abbott replied they do not drive there. When he has been at the Business Center, it has very adequate parking and there are very few cars there during the school day. Councilmember Varichak asked whether the Fridley School District will still have the ALC program at the Community Center. Chief Abbott replied, they do; and they are not a partner with this ALC. Fridley has and will still continue to operate their ALC at the Fridley Community Center. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 19 Mayor Lund asked if District 916 encompasses a different geographical area or includes different school districts. Do they fall under the umbrella of 916? He always thought 916 was a district in St. Paul. Chief Abbott replied District 916 is an intermediate school district. They cover several other school districts in a geographical sense providing services contracted by those other school districts. By overlapping several school districts in their coverage areas, each of those school districts may contract with District 916 for services beyond what they provide in their district. Mayor Lund asked regarding the officer during the summer months, there is a 20 percent cost or timeline where they are not going to be at the school. This officer would be reassigned duties in the City when school is not in session. He estimates there would be about six weeks where the officer would be available for other duties. Chief Abbott replied they do limit the amount of vacation/annual leave time the SRO takes during the school year. When they come back to the City for other duties in the summer, approximately one-third of the summer is spent using that annual leave time. For roughly two months, the Police Department assigns them basically where they need them. This summer, because of staff openings, their need is in the patrol division and that is where the City’s two SRO's from Fridley High School and Middle School will be working this summer. Mr. Wysopal stated the City did not ask for this Alternative Learning Center to be located in the City. It has no control over that. It fits the zoning district, and it went in as kind of a surprise. Second of all, the numbers work because the City appoints an experienced officer to that position, and that means 80 percent of an experienced officer compared to a new officer. It is the differential of wages from entry level to experienced that make the numbers work. Finally, if the Alternative Learning Center leaves as quickly as it came into town, the City has enough fluidity in its personnel staff, with retirements coming up, that it can abandon that program without having an additional person. Later in the year, the Council will be asked to amend the budget. MOTION by Councilmember Bolkcom to approve the Agreement for School Resource Officer between the City of Fridley and Northeast Metro 916 Intermediate School District. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. Second Reading of an Ordinance of the City of Fridley, Minnesota, Amending City Ordinance No. 1095, the Prevailing Hours of Labor and Prevailing Wage Rate on Certain Projects for or with the City. Councilmember Barnette stated the prevailing wage ordinance has worked out very well for the City. Trident has some concerns in regard to that. He wanted to give a clarification to the public why this is different than an organization to come and ask for TIF financing which would then qualify for the prevailing wage ordinance. This is a trade-in for that. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 20 Wally Wysopal, City Manager,stated the ordinance as it was created addressed a few of things. When there are certain situations where City funds are being used for a project when there is bonding being done, so that risk is spread out across the entire community; or if there are grants and loans that are being backed up by the full faith and credit of the City; or if there is tax increment financing that is going to pay for subsidy for the actual development. Mr. Wysopal stated it is not uncommon in some cities to actually subsidize the construction of the project so the City gets a certain standard being built. For example, the developer proposes to put up a wood structure and the City wants brick on the exterior. The developer says the added cost of the brick is costing so much money, therefore, he would ask for TIF money which comes from that project. Then it truly is a subsidy of the City. In this case the project is one where the developer also owns a lot of the contracting that will take place. They pay good wages and benefits to their employees in order to keep them because they move from project to project. The ownership of the project is going to be held by the developer and the contractors so it is going to be a good project. They want to make sure they build a good project and a quality project so it lasts and has minimal expenses. Mr. Wysopal stated it followed the essence of the ordinance that existed except for Subdivision 2(c), which said “Wages paid for all work performed on any project for a Developer in conjunction with the Developer’s development of real property in the City, if the Developer purchases said real property from the HRA or City . . ..” That is what is happening here. The developer is buying the property from the HRA, but that is it. They are paying market rate so anybody else can buy this property and do what the developer is proposing on it. This will be clarified by adding that phrase, "less than its fair market value." Mr. Wysopal stated this property was purchased by the HRA over time. It was cleared, prepped, made available; and the HRA incurred expenses to do those things. However, the developer is buying the property at fair market value. To compare it to a couple of other projects, such as the Northern Stacks project which has tax increment financing on it, of which that money is helping the developer build those buildings. Another project would be the one this developer built over on the old Sandee's site. That project received no City or HRA funding. It was not owned by the City so they were not aware of this ordinance, and that is what brought it up. Adding the phrase, "less than its market value" protects the City and the HRA. If we were to lower the price of that property by $1 a square foot, that would not be fair market value and, therefore, the developer would have to pay the prevailing wage. Mr. Wysopal stated the developer indicated they have many union subcontractors working with them, and they do intend to have those same union subcontractors working with them on this project. This change does not preclude the City from saying we do not want this to apply; therefore, whatever project, even if they are selling it at fair market value, we want it to be a prevailing wage project. The City retains that authority. MOTION by Councilmember Barnette to waive the reading of the ordinance and adopt Ordinance No. 1315 on second reading and order publications. Seconded by Councilmember Varichak. FRIDLEY CITY COUNCIL MEETING OF APRIL 28, 2014 PAGE 21 UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 16. Informal Status Reports. Councilmember Bolkcom stated they approved the street project tonight. She asked Mr. Kosluchar to let the businesses know that actually part of the contract was to do some of the work at night. Councilmember Bolkcom asked if the City crews could look at some of the City's bus stops. There is one going north between 60th and 61st on East River Road, no one can sit at it. ADJOURN: MOTION by Councilmember Barnette, seconded by Councilmember Varichak, to adjourn. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE MEETING ADJOURNED AT 8:59. P.M. Respectfully submitted by, Denise M. Johnson Scott J. Lund Recording Secretary Mayor