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CHM 10/05/2015 CITY OF FRIDLEY CHARTER COMMISSION MEETING OCTOBER 5, 2015 CALL TO ORDER: Chairperson Reynolds called the Charter Commission meeting to order at 7:00 p.m. The meeting was recessed until 7:11 to enjoy a treat that was brought in for the Commissioners by Commissioner Scholzen. ROLL CALL: Members Present: Commissioners Peter Borman, Don Findell, Manuel Granroos, Ted Kranz, Rick Nelson, David Ostwald, Barb Reiland, Pam Reynolds, Lois Scholzen, Arvonna Stark, and Richard Walch Members Absent: Commissioners Gary Braam, Marion Flickinger, Novella Olawore, and Cindy Soule Others Present: Deb Skogen, City Clerk/Staff Liaison Councilmember Dolores Varichak APPROVAL OF AGENDA UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON REYNOLDS DECLARED THE MOTION CARRIED. APPROVAL OF MINUTES Commissioner Reiland MOVED and Commissioner Findell seconded a motion approving the Charter Commission meeting minutes of September 5, 2015. Chairperson Reynolds requested the following changes to the minutes:  Page 1 – last paragraph, first sentence, change “she” to “he”.  Page 2 – first paragraph, first sentence, change “side” to “said” and last sentence add the word “the” before manager.  Page 2 – second sentence, change “Walsh” to “Walch”.  Page 2 – fifth paragraph, last sentence, change “2015” to “2016”.  Page 4 – third paragraph, remove the word “the” before budgeting in second sentence  Page 4 – last paragraph, the second sentence should read: “Ms Skogen said another example was the railroad trestle on Locke Lake that had a corn spill spilled.”  Page 6 – third to last paragraph, first sentence, to add a comma after the words Chairperson Reynolds said, ADOPTED NOVEMBER 2, 2015 CHARTER COMMISSION MEETING OF OCTOBER 5, 2015 PAGE 2 Commissioner Reiland MOVED to accept amended minutes as amended and Commissioner Findell seconded the motion. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON REYNOLDS DECLARED THE AMENDED MOTION CARRIED. ADMINISTRATIVE MATTERS A.Update on Commission Vacancy nd Ms. Skogen said Commissioner Borman would attend his last meeting on November 2. She had received two inquiries about the Charter Commission and had sent an application to the individuals. She said the notice will be in the SunFocus and the City’s web site. She would bring any applications received to the next meeting for their review. OLD BUSINESS A.Discussion of Section 7.12D Ms. Skogen had reformatted Section 7.12D into a more bulleted format to make it easier to read and understand. Commissioner Findell MOVED and Commissioner Reiland seconded a motion to adopt this format for the Charter. UPON A VOICE VOTE BEING TAKEN, CHAIRPERSON REYNOLDS DECLARED THE MOTION CARRIED. Chairperson Reynolds said she found four other sections in the Charter with the same format and wondered if they should also be reformatted. She asked if the Commissioner’s had done any changes to Section 1.02. Ms. Skogen said it had been reformatted for them to review, but no changes had been done. Chairperson Reynolds said the other sections were 4.08; 7.04; 7.15(2) and 7.18. Commissioner Reiland MOVED and Commissioner Stark seconded a motion requesting staff to prepare Charter Sections 1.02; 4.08; 7.04; 7.15(2) and 7.18 into the preferred bullet format. UPON A VOICE VOTE BEING TAKEN, CHAIRPERSON REYNOLDS DECLARED THE MOTION CARRIED. ADOPTED NOVEMBER 2, 2015 CHARTER COMMISSION MEETING OF OCTOBER 5, 2015 PAGE 3 B.Discussion of Chapter 6 Commissioner Findell MOVED and Commissioner Kranz seconded the motion removing the discussion of Chapter 6 from the table. UPON A VOICE VOTE BEING TAKEN, CHAIRPERSON REYNOLDS DECLARED THE MOTION CARRIED. Ms. Skogen handed out a League of Minnesota Cities (LMC) memo on competitive bidding and contracts. The memo had been prepared in September, due to changes in state law to include best value contracting. She provided definitions on let and execute from the web or dictionary. She said the word “let” was really a legal or contract term and suggested not changing because it is used in the field and is acceptable. Commissioner Borman asked about the competitive bidding process. He wondered if the contract had to be awarded to the lowest bidder or just that it is open for bid. Ms. Skogen said state law was changed during the 2015 legislative session. The law now allows the ability to award based on “best value contracting”. If you choose to go that route, you have to advertise that you are awarding the contract on best value. It provides an alternative to the competitive bidding process for certain kinds of contracts. Best value contracting allows you to take into consideration the contractor’s performance, timeliness, level of customer satisfaction; finance; ability to minimize cost over runs and change orders, project plans, technical capability and more based on past performance. Commissioner Borman had read an article about St. Croix River Bridge that CS McCrossen had the lowest bid, but had not received the bid. He understood they were going to court to contest the contract. Ms. Skogen said best value was new and it may have played a part in the St. Croix River Bridge process. Commissioner Kranz asked if the prevailing wage was in the Charter. Ms. Skogen said it was not part of the Charter but it was an ordinance that had been adopted by the City Council for use on city projects. Commissioner Findell asked Ms. Skogen if service contracts would be exempt from the competitive bidding process. Ms. Skogen said yes service contracts and contracts for professional services were not included in the competitive bidding process, however, based on the dollar amount of the contract, staff still provides comparison proposals for services to determine which contract to go with or purchases from the state contract. Chairperson Reynolds said, at one point in their discussion Ms. Skogen recommended separating purchases from contracts. Ms. Skogen thought it would be easier to understand, after reviewing how the Minnetonka language was. ADOPTED NOVEMBER 2, 2015 CHARTER COMMISSION MEETING OF OCTOBER 5, 2015 PAGE 4 Commissioner Nelson said he did not think it was a good idea to put a specific policy into place as it would tie the Council’s hands. The Commissioners discussed Section 6.05 which allows for a policy to be set for the city manager to designate who may purchase, and revise it as needed. Chairperson Reynolds said Charter Section 7.06, Enforcement of the Budget, states, “No officer or employee of the city shall place any order or make any purchase except for the purposes and to the amounts authorized in the budget. Any obligation incurred by any person in the employ of the City for any purpose not authorized in the budget or for any amount in excess of the amount therein authorized shall be a personal obligation upon the person incurring the expense.” She said if someone signed off on a contract or purchase that was not approved or authorized in the budget, that they could be liable and pay for it. Ms. Skogen said Section 7.06 addressed the enforcement of the budget, but it also gives the city manager the power to discipline, suspend or terminate an employee if this were to happen. They talked about likely scenarios where this might happen. Chairperson Reynolds said when she re-read the staff memo dated January 14, that has to do with the Commission’s discussion of Chapter 6, that the request from staff to provide a list for informational purposes to the Council regarding claims was not a good idea. She said the Council was ultimately responsible and believed they should consider approving the claims because the preamble to Chapter 7 says the Council is responsible for finances. She did not agree with the language in the Minnetonka Charter. Ms. Skogen said the memo was to provide information to the Commission as reference and the Charter Commission decided not to make any additional changes pertaining to that language. Commissioner Nelson thought a good share of the claims would have already been paid. He said having the Council approve them isn’t the best practice. Ms. Skogen said currently the checks that have been prepared for payment are not mailed until the day after the Council meeting, after the City Council has had time to review and ask questions if they have any. Councilmember Varichak said if she has a question, she asks for information prior to the council meeting from the city manager. Chairperson Reynolds asked if the council was looking at the claims, asking questions about the claims and approving them prior to being paid. She said just because it was in the budget didn’t mean that it is specifically listed. Commissioner Borman said the Council reviewed the claims, which are generally items that have been budgeted for. He used the following example: Park and Recreation had a budget of $500,000.00 to purchase tools and instead of spreading it out over a year, they wrote one check for $500,000. That that would show up on the Claims and the Council would question it, allowing Parks to come and address the claim, even if it was approved in the budget? ADOPTED NOVEMBER 2, 2015 CHARTER COMMISSION MEETING OF OCTOBER 5, 2015 PAGE 5 Ms. Skogen said if the purchase was over $100,000 it would have to come before council for approval, even if it was in the budget, prior to the purchase. Commissioner Reiland asked if the claims list included the department who purchased the item. Ms. Skogen said it provides an account number which would identify the department. Chairperson Reynolds said that the budget is amended, but yet the Charter doesn’t allow for the budget to be amended. Ms. Skogen said departments stay within their budgeted amount; however, they may amend which account code receives a specific dollar amount if they are over in a specific account code. Chairperson Reynolds said in Charter Section 7.02 the Council shall not have the power to increase the amount therein fixed beyond the estimated revenues. Ms. Skogen didn’t think you could increase the budget once the budget was adopted. Charter Section 7.07, by a vote of at least 4 members may authorize the transfer of sums from the unexpected balances of the budget to other purposes. They do this by resolution stating where the dollars are and where they come from. Councilmember Varichak said if the City budgeted $15M they would have to stay within that budget. Ms. Skogen said you may have undesignated funds that could be used if needed and transferred. Councilmember Varichak used the example from the tree storm where they transferred money from the undesignated funds to the fund for cleaning up the debris. Commissioner Findell wondered about whether or not the language needed to be amended to address best value contracting. Ms. Skogen said it is now part of the state law as an alternate method so you want to amend it somewhat so it is not just the lowest responsible bidder. Commissioner Borman said he did not think they had to amend the language so it reflected the language in the Minnetonka Charter; but wondered what was harmful in the Minnetonka language vs. the Fridley Charter. He understood the Minnetonka Policy could not become part of the charter but said each department has a policy they follow and how they conduct their day to day business. Chairperson Reynolds said they are being told the Charter is not being followed because there are other people who may make purchase and contract under $100,000, so we are trying to make it work in Fridley. She said while the Minnetonka language is good, she thought it was harmful to remove the Council responsibility for viewing what has been paid so they know what has been paid. How does the Council know what is being spent if they aren’t looking at the claims. Ms. Skogen said you could change it; it doesn’t have to be the same language. Chairperson Reynolds agreed and asked what other Commissioners thought. She said there had to be checks and balances and councilmembers should be viewing the claims. She was ADOPTED NOVEMBER 2, 2015 CHARTER COMMISSION MEETING OF OCTOBER 5, 2015 PAGE 6 also wondering if changes were made in 6.05 or 6.06 if other changes to other sections would have to be made. Commissioner Findell said for the payment of claims Section 7.11 addressed how disbursements were made by requiring an itemized bill that shall be approved and signed by the responsible City Officer who vouches for the correctness and reasonableness thereof. He thought that was why the claims went on the consent agenda and upon the Council’s approval, it allows the City mail the checks the next day. Ms. Skogen said the Commissioners amended Section 6.05 allowing for the City Manager to create a policy to allow for a designee(s) to have purchasing power. The Commissioners all were in agreement to amendment in Section 6.05. Commissioner Findell MOVED and Commissioner Kranz seconded a motion approving Section 6.05 as amended. UPON A VOICE VOTE BEING TAKEN, CHAIRPERSON REYNOLDS DECLARED THE MOTION CARRIED. Commissioner Borman said this would be the section to address best value contracting. Ms. Skogen said because the Charter can be more restrictive than state law, the current language would require the city to continue using the lowest responsible bidding, even though state law does provide for the best value alternative. If the Commissioners felt they wanted to have best value contracting, the charter should be amended to allow for that language. Commissioner Borman said the state has been using best value contracting. He said he knew the owner of CS McCrossen and he was the lowest bidder on the St. Croix River Bridge but that the state brought in other things he had done on other jobs. Chairperson Reynolds said the LMC memo cited a court case (Rochester City Lines vs. City of Rochester) where the court or Attorney General ruled against the bidder citing their past practices/projects. Ms. Skogen said cities using best value contracting have to receive training and they have to advertise that they will be using best value contracting in their advertisement for bid and request for proposal. The training will be provided by the Department of Administration providing the details on the criteria methods. The Commissioners discussed whether or not the current language would allow for best value contracting and concluded it did not. The Commissioners determined they wanted the City Council to have a choice of the lowest responsible bidder or the ability to use the best value alternative. Commissioner Findell recommended the following language to amended Section 6.06 as follows: ADOPTED NOVEMBER 2, 2015 CHARTER COMMISSION MEETING OF OCTOBER 5, 2015 PAGE 7 When a bid is required, it shall be let to the lowest responsible bidder who is qualified the City Council shall have the option of lowest responsible bid or best value bid as described in accordance with Minnesota State Statutes as determined by the Council. Chairperson Reynolds suggested Ms. Skogen prepare a draft ordinance for the Commission’s review at the next meeting. C.Discussion of Chapter 10 Ms. Skogen told the Commission that CenturyLink had sent a letter to the City requesting the initiation of an additional cable communications franchise. NEW BUSINESS Councilmember Dolores Varichak thanked the Commissioners for all of their hard work and deliberation with the Charter. And thanked staff for providing information to the City Council. She thanked Commissioner Borman for his years of service and wished him well. FUTURE MEETING TOPICS/COMMUNICATIONS  Approval of Agenda/Minutes  Administrative Matters – Update on Vacancy for Commissioner Borman’s seat and reviewal of Sections 1.02; 4.08; 7.04;7.15(2); and 7.18 in bullet format; and setting 2016 calendar  Discussion of Proposed Ordinance - Chapter 6  Discussion of Chapter 10 ADJOURNMENT: Commissioner Borman MOVED and Commissioner Findell seconded a motion to adjourn the meeting. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON REYNOLDS DECLARED THE MOTION CARRIED AND THE MEETING WAS ADJOURNED AT 8:50 P.M. Respectfully submitted, Debra A. Skogen Commissioner Donald Findell City Clerk/Staff Liaison Secretary ADOPTED NOVEMBER 2, 2015