12/09/1991 - 00006345�
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THE MINUTEB OF THE REGULAR MEETING OF THE FRIDLEY CITY COUNCIL OF
DECEMBER 9. 1991
The Regular Meeting of the Fridley City Council was called to order
at 7:35 p.m. by Mayor Nee.
PLEDGE OF ALLEGIANCE:
Mayor Nee led the councilmembers and audience in the Pledge of
Allegiance to the Flag.
ROLL CALL•
MEMBERS PRESENT:
MEMBERS ABSENT:
APPROVAL OF MINUTES
Mayor Nee, Councilwoman Jorgenson, Councilman
Billings, Councilman Schneider, and Councilman
Fitzpatrick
None
COUNCIL MEETING, DECEMBER 2, 1991:
MOTION by Councilwoman Jorgenson to approve the minutes as
presented. Seconded by Councilman Billings. Upon a voice vote,
all voting aye, Mayor Nee declared the motion carried unanimously.
ADOPTION OF AGENDA:
MOTION by Councilman Schneider to adopt the agenda as presented.
Seconded by Councilwoman Jorgenson. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously.
OPEN FORUM, VISITORS:
There was no response from the audience under this item of
business.
NORTEL CABLE RATE INCREASE:
Councilman Billings stated that a resident took advantage of some
unique marketing and sent a note to the City asking why Council
was letting Nortel get away with a rate increase, and that they
should do something for the people. He stated that in 1987 or
1988, Congress chose to enact legislation that prohibits any city
from infringing on the rights of a cable company to set their own
rates. He stated that this note was not signed, therefore, Council
cannot respond, and he hopes that this individual will get this
message.
Councilman Billings suggested if anyone else has a problem, they
contact Nortel and not the City, as the City is prohibited by
federal law from interfering with these rates.
FRIDLEY CITX COIINCIL MEETING OF DECEMBER 9, 1991 PAGE 2
�Mayor Nee stated that Councilman Billings' point is well taken, and
_ there is legislation now in Congress to modify that set of
statutes, which would return a certain amount of regulatory powers
to the cities. He suggested that residents write their senators
and representatives regarding this issue.
PUBLIC HEARING:
1. PUBLIC HEARING FOR MODIFICATION TO REDEVELOPMENT PROJECT NO. 1
AND CREATION OF TAX INCREMENT FINANCING DISTRICT NO. 12
(MCGLYNN BAKERIES, INC.):
MOTION by Councilman Billinqs to waive the reading of the public
hearing notice and open the public hearing. Seconded by Councilman
Fitzpatrick. Upon a voice vote, all voting aye, Mayor Nee declared
the motion carried unanimously and the public hearing opened at
7:40 p.m.
Ms. Dacy, Community Development Director, stated that McGlynn
Bakeries, Inc. is proposing to purchase the former Totino plant for
a retail production facility. She stated that McGlynn Bakeries
processed a lot split request to subdivide the Pillsbury property
in order to add an additional acre to this proposed site. Ms. Dacy
stated that this public hearing is to modify the redevelopment
� district by adding the Pillsbury property and to create Tax
Increment Financing District No. 12.
Ms. Dacy stated state statutes require that the "but-for" test must
be met, and this property meets these requirements. She stated
that the building has been vacant about eighteen months and is
about 21-years-old. She stated that extensive rehabilitation is
necessary at a cost of approximately $4,800,000 resulting in a
total project cost of about $12,000,000. She stated that because
of the excessive rehabilitation costs and the proposed project that
will increase the value of the property and provide additional job
opportunities, a modification to the City�s redevelopment plan and
creation of a tax increment financing district is recommended. She
stated that the project would not proceed in the foreseeable future
without the City's assistance.
Mr. Jim Casserly, Economic Develogment Consultant for the Housing
and Redevelopment Authority, stated that the information submitted
to Council includes a tax increment plan, correspondence with Anoka
County, an overview by staff, and a chart to show the amount of tax
increment involved in this project.
Mr. Casserly stated that the City has created eleven tax increment
districts, and all the project areas are integrated into a single
development program. He stated that this public hearing is to
� modify the development plan and increase the project area to
include Tax Inerement Financing District No. 12.
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9, 1991 PAGE 3
Councilman 5chneider asked if there were any other state
requirements in addition to the "but-for" test.
Mr. Casserly stated that the "but-for" test deals with the
financial element. He stated that other requirements are to
determine what type of districts can be established, such as for
soil correction, housing, etc. He stated that this project meets
the criteria of a redevelopment district, and the State allows a
time period up to 25 years for such a district,
Councilman Schneider asked if there are any state requirements as
to the type of facility that qualifies for inclusion in a tax
increment financing district.
Mr. Casserly stated that the development plan contains the
objectives, and those ob7ectives include increasing the tax base,
providing employment opportunities, eliminating blight, and other
items the City has asked the HRA to accomplish. He stated that
each project is judged on the merits of ineeting the requirements
of the development plan.
Mr. Casserly stated that no bonds would be issued for this project,
and the sources of revenue are the annual collection of tax
increment and the economic reaovery grant from the state. He
stated the statute requires that all sources of revenue be listed
when a plan is created. He stated that the original tax capacity
is estimated to be $110,574 based on the original value of
approximately $2,300,000 when the district is created. He stated
that this is a district with a declining valuation, as the property
is deteriorating and producing no income. Mr. Casserly stated that
when a tax increment financing district is created the value is
frozen, and it is only that valuation over the $2,300,000 that will
result in tax increment.
Councilman Billings questioned the type of assistance provided by
the City.
Ms. Dacy stated that the HRA would be considering a development
contract that would include the issuance of a note payable to
McGlynn's.
Councilman Billings asked if the present value of the amount to
McGlynn's would be about $649,542. Ms. Dacy stated that was
correct.
Councilman Billings stated that this amount is based on an
inflation rate of 1.50 percent, and he asked if this amount would
be adjusted if the inflation rate is less.
Mr. Casserly stated that the amount would be adjusted. He stated
that it is their belief the valuation is going to be $200,000 to
$300,000 less and, if this is the case, the numbers will be
reduced.
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9, 1991 PAGE 4
Councilman Sohneider asked if the $649,542 was a cap, to which
Mr. Casserly answered in the affirmative.
Councilman Billings stated that staff's memo indicates a cost of
$3,550,000 to acquire the property. He stated that in McGlynn's
letter to Mr. Burns, City Manager, dated October 16, 1991, the
selling price of the property is listed as $2,550,000, of which
only $1,464,000 was for the land and buildings. He asked what the
assessor currently lists as the estimated market value for taxes
payable in 1992.
Mr. Casserly stated that for the specific parcel that McGlynn's is
purchasing it is $2,100,000.
Councilman Billings stated this indicates a decrease in the value,
and he asked the estimated market value of the building for the
last several years.
Mr. Casserly stated that he believes it was at $3,600,000 for taxes
payable this year, and he thought it was four or five percent
higher for the preceding year.
Mr. Rasmussen, Vice President of Marketing/Strategic Planning for
McGlynn's, stated that the assessed value was $1,400,000.
Mr. Casserly stated that it had been reduced to $3,600,000 and then
reduced again.
Councilman Billings stated that taxes collected in 1991 were based
on a market value of $3,600,000, and for 1992 those taxes will be
based on a market value of $2,100,0000. This is about a forty
percent decrease in value in one year. He stated that for the next
several years the amount that is not captured in the tax increment
district will be substantially less than what it has been in the
last several years.
Councilman Billings asked the selling price of the property. Mr.
Casserly stated that the purchase agreement is for $2,550,000.
Mr. Rasmussen stated that this figure includes non-taxable
property.
Councilman Billings stated the letter to Mr. Burns indicates that
$1,464,000 is for the land and building.
Mr. Casserly stated he believed the City Assessor indicated that
about $450,000 of the value was in personal property.
Mr. Casserly stated that the building itself is unusual, and he
feels it is a very difficult structure to value.
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9. 1991 PAGE 7
� the 200 plus jobs transferred from the Eden Prairie location are
in the $9.00 to $12.00 per hour range. He asked if this was
comparable to the pay at the Chanhassen facility.
Mr. Rasmussen stated that the pay is on two different bases. He
stated that in Eden Prairie, it is union and pay is on an hourly
basis. He stated that in Chanhassen it is non-union, and employees
are paid on a salary basis. He stated that the final result is
about the same.
Councilman Billings asked if the fringe benefits would be
comparable between both facilities.
Mr. Rasmussen stated that the union employees at Eden Prairie have
a pension plan, and the non-union employees at Chanhassen have a
4olK plan. He stated that McGlynn's pays loo percent of their
employees' health insurance.
Councilman Billings stated that he understands there are temporary
employees at the Eden Prairie facility.
Mr. Rasmussen stated that occasionally McGlynn's employs temporary
personnel for seasonal surges. He stated that they also have
temporary employees at the Chanhassen facility. He stated that
� they work extensively with the Minnesota Job Service to hire long-
term employees, and many of the temporary employees become full-
time employees with the company.
Councilman Billings asked if McGlynn's would use the temporary
pools for their Fridley facility.
Mr. Rasmussen stated that their retail operations probably have
less temporaries, and he believed the Eden Prairie retail operation
has the least number of temporary personnel.
Councilman Billings asked if the temporary employees are covered
under any pension or benefit plan through the temporary agencies.
Mr. Rasmussen stated he believed that they are not covered under
any plan.
Councilman Billings stated that since the Fridley facility would
�e primarily a retail operation the number of temporary employees
would be minimal.
Mr. Rasmussen answered in the affirmative.
Mr. John Johnstone, 21� 67th Avenue, stated that he has worked for
McGlynn's in their retail operations for nineteen years, and it
� would be beneficial to him for them to locate in Fridley. He
stated that he is astonished by McGlynn's growth. He stated that
they are a very good company to work for and really care for their
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9. 1991 PAGE S
employees. He felt that the looation of McGlynn's in Fridley would
be good for the City.
No other persons in the audience spoke regarding the creation of
this tax increment financial district.
MOTTON by Councilman Billings to close the public hearing.
Seconded by Councilman Fitzpatrick. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously and the
public hearing closed at 8:44 p.m.
OLD BUSINESS•
2. RESOLUTION NO. 98-1991 AUTHORIZING CONSTRUCTION OF A GARAGE
WITHIN A UTILITY EASEMENT OVER THE VACATED ALLEY EAST OF
LOTS 25 AND 26, BLOCK 5, HYDE PARK fTABLED OCTOBER 7, 19911:
Mayor Nee removed this item £rom the table.
Councilman Billings stated that this item has been before the
Council several times and was tabled, as the petitioner was
considering moving the location of his garage from where the
Council had originally approved the variance. He stated that the
revised plan proposing the garage on the south property line will
� not change the amount of impervious surface. He stated that a
letter has been submitted from the property owners to the south
verifying they have no objection to the revised location.
MOTION by Councilman Billings to adopt Resolution No. 98-1991.
Seconded by Councilman Fitzpatrick. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously.
NEW BUSINESS:
3. RESOLUTION NO. 99-1991 IN SUPPORT OF AN APPLICATION FOR A
MINNESOTA LAWFUL GAMBLING PREMISE PERMIT TO THE FRIDLEY
JAYCEES (JOE DIMAGGIO'S1:
MOTION by Councilman Schneider to adopt Resolution No. 99-1991.
Seconded by Councilman Fitzpatrick. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously.
4. RESOLUTION NO. 100-1991 IN SUPPORT OF AN APPLICATION FOR A
MINNESOTA LAWFUL GAMBLING PREMISE PERMIT TO THE FRIDLEY
JAYCEES (SANDEE'Sj�
MOTION by Councilman Schneider to adopt Resolution No. 1�0-1991.
Seconded by Councilman Sillings. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously.
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9, 1991 PAGE 9
5. RESOLUTION N0. 101-1991 PROVIDING FOR SEWER RATE INCREASES FOR
1992•
Mr. Pribyl, Finance Director, stated since 1988, the disposal
charges paid to the Metropolitan Waste Control Commission have
increased by 29 percent. He stated it is proposed that the City
increase the rates by approximately 15 percent. He stated if the
sewer rates are not increased there will be an operating loss of
$253,816.
Mr. Pribyl stated that the residential rate is proposed to increase
from $24.65 per quarter to $28.35 for single family residential
properties and from $7.80 to $10.00 per quarter for seniors. He
stated that all others will be increased from $1.08/1000 gallons
to $1.25/1,000 gallons, with a minimum billing of $31.25 per
quarter based on 25,000 gallons.
Councilman Schneider asked how Fridley's rates compare with other
communities.
Mr. Pribyl stated that Columbia Heights is the only community that
has a lower sewer rate.
Mr. Pribyl stated that the Public Works Director and his staff are
trying to monitor the water infiltration into the sewer system.
Mr. Flora, Public Works Director, stated that there is a
considerable amount of infiltration and inflow in the pipe. He
stated that the Metropolitan Waste Control Commission is conducting
a study in an attempt to reduce the infiltration in the line so
that they are dealing with true sewage.
Councilman Billings stated that he attended a meeting several
months ago where the purity of the water leaving the treatment
plant was discussed. He stated that if a facility has to be built
to remove the phosphorus, residents can expect the sewer rates to
increase by an additional forty percent to cover the cost of this
facility.
Mr. Flora stated that the Environmental Protection Agency has
placed stipulations on the Metropolitan waste Control Commission's
permit to reduce their phosphorus release to drinking water
quality. He stated that a pilot plant is being constructed by the
MWCC to determine the cost to deal with the phosphorus and to
monitor the Mississippi and Minnesota Rivers to determine in
phosphorus levels. He stated that if the federal government states
that phosphorus needs to be dealt with, there will be considerable
cost involved to deal with this issue.
Councilman Billings stated that at the meeting he attended, it was
stated that the majority of the phosphorus that is in the sewer
system is from humans. He stated that humans need phosphorus in
FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9, 1991 PAGE 10
� their bodies, but they do not retain it. He stated triat even if
the phosghorus was eliminated in soap, 75 percent is cominq from
human life.
MOTION by Councilman Schneider to adopt Resolution No. 101-1991.
Seconded by Councilman Billings.
MOTION by Councilman Schneider to amend Resolution No. 101-1991 by
deleting the last paragraph which refers to the City Manager having
authority to annually adjust sewer rates. Seconded by Councilman
Fitzpatrick. Upon a voice vote, all voting aye, Mayor Nee declared
the motion carried unanimously.
UPON A VOICE VOTE TAKEN ON THE MAIN MOTION, all voted aye, and
Mayor Nee declared the motion carried unanimously.
b. RECEIVE AN ITEM FROM THE APPEALS COMMISSION MEETING OF
NOVEMBER 12, 1991:
A. VARIANCE REQUEST, VAR #91-33, BY STEVEN HUNGER,TO ALLOW THE
CONTINUED NON-CONFOF2MANCE OF 1�, STRUCTURE WHEN THE NECESSARY
REPAIRS TO UPGRADE IT CONSTITUTE MORE THAN 50 PERCENT OF THE
FAIR MARKET VALUE OF A STRUCTURE; TO REDUCE THE MINIMUM
REQUIRED LOT AREA FROM 7.500 SqUARE FEET TO 7.460 SOUARE FEET:
� ANp TO REDUCE THE RE9UIRED STDE YARD SETBACK FROM 10 FEET TO
4.8 FEET, TO ALLOW THE RECON5TRUCTION OF THE 5INGLE FAMILY
DWELLING ON LOTS 10, 11 AND THE EAST HALF OF LOT 12, BLOCK H,
RIVERVIEW HEIGHTS, GENERALLY LOCATED AT 501 GLENCOE
STREET N.E.:
Ms. Dacy, Community Development Director, stated that this is a
request for several variances; to allow repairs to a structure even
though the repairs constitute more than fifty percent of the fair
market Value; to reduce the minimum lot area from 7,500 to 7,460
square feet; and to reduce the side yard setback from l0 to
4.8 feet. She stated that the new property owners want to make
additions to the home, including a garage, and to upgrade the
structure to current building codes.
Ms. Dacy stated that the Appeals Commission recommended approval
of the variances with three stipulations outlined on Page 6 of the
agenda, which she outlined.
MOTION by Councilman Fitzpatrick to concur with the recommendation
of the Appeals Commission and grant Variance Request, VAR #91-33,
with the following stipulations: (1) the petitioner shall provide
a hard surface driveway by August 1, 1992; (2) the petitioner shall
upgrade the structure to meet current building code requirements;
and (3) the petitioner sha11 install new windows and exterior
� doors, re-side, and re-roof the entire structure. Seconded by
Councilman Schneider. Upon a vaice vote, a11 voting aye, Mayor Nee
declared the motion carried unanimously,
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9 1991 PAGE 11
' MoTION by Councilman Billings to receive the minutes of the Appeals
Commission Meeting of November 12, 1991. Seconded by Councilman
Schneider. Upon a voice vote, all voting aye, Mayor Nee declared
the motion carried unanimously.
7. APPROVAL OF EXTENSION OF TRAILER LICENSE TO RMS COMPANY:
Ms. Dacy, Community Development Director, stated that RMS Company
has requested an extension of their trailer license to
April 1, 1992. She stated that staff recommends approval of this
extension.
MOTION by Councilman Schneider to approve the extension of RMS
Company's trailer license to April 1, 1992. Seconded by Councilman
Billings. Upon a voice vote, all voting aye, Mayor Nee declared
the motion carried unanimously.
8. APPROVAL OF REOUEST FORM MULTICARE ASSOCIATES AND HEALTA ONE
FOR LIMITED PARKING ON MADISON STREET BETWEEN LYRIC LANE AND
OSBORNE ROAD:
Mr. Flora, Public Works Director, stated that the City has received
a request from the Fridley Medical Center and Unity Hospital to
allow parking on Madison Street. He stated that staff has reviewed
� this request and would support one-hour parking on the east side
of Madison Street, with no parking on the west side of the street.
He stated that this would allow for adequate ingress and egress to
the hospital.
MoTION by Councilman Billings to concur with the staff's
recommendation and authorize the appropriate department to take
action, as quickly as conditions allow, to install one hour parking
signs on the east side of Madison Street. Seconded by Councilman
Schneider. Upon a voice vote, all voting aye, Mayor Nee declared
the motion carried unanimously.
9. RESOLUTION NO. 102-1991 ADOPTING THE INTERIM PROGRAM OF
WETLAND REGULATION:
Mr. Flora, Public Works Director, stated that this resolution
adopts the proposed guidelines for the interim program of wetland
regulation. He stated that the Rice Creek Watershed District has
taken the position that they prefer the cities to take over the
responsibility for wetland management. He stated that within the
Six Cities Watershed District, each city is responsible for its own
development and plan management.
Mr, Flora stated that he recommends adoption oP this resolution and
forwarding it to the two watershed districts and the Board of Soil
� and Water Resources to notify them of Council's action.
FRIDLEY CITY COUNCIL MEETING OF DECEMSER 4. 1991 PAGE 12
1 MOTION by Councilman Billings to adopt Resolution No. 102-1991.
Seconded by Councilman Schneider. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously.
10. INFORMAL STATUS REPORTS:
SNOW REMOVAL OPTIONS:
Mr. Hill, Acting City Manager, stated that City staff is working
on options and alternatives for snow plowing operations.
THE ORTHODOX CHURCH OF THE RESURRECTION OF CHRIST, INC.:
Councilman Schneider stated that the neighborhood meeting regarding
the Orthodox Church of the Resurrection o£ Christ, Inc. was well
attended. He stated that no representatives from the church
attended the meeting. He stated that Virgil Herrick, City
Attorney, presented some history and cited jurisdictional powers
pertaining to land use as it relates to churches.
Councilman Schneider stated that the residents in the neighborhood
are concerned about the architectural changes to the dwelling. He
stated that there is also concern about the use of the property and
if it is being used as a church. He stated that the final
� resolution of the meeting was an attempt to get some of the
neighbors and Father Magramm to take advantage of the Anoka County
Mediation Services to try and resolve the issues without getting
into a legal situation. He stated that Father Magramm is willing
to proceed in this direction, and it is now a matter of setting up
the meeting.
Mr. Hezrick, City Attorney, stated that he was contacted by Father
Magramm who requested a meeting. He stated that he has no idea
what he wants to discuss, but advised him if he wanted to come to
his office this Friday, he would talk to him.
Ms. Dacy, Community Development Director, stated that she will
write a summary regarding this meeting.
FLOODING POTENTIAL:
Mayor Nee stated that he was concerned with the staff inemo
regarding the December 4, 1991 Metropolitan Emergency Managers
Association Meeting where the potential for flooding was addressed.
Mayor Nee felt that this issue cannot be addressed directly until
the City Manager returns. He stated that it may be a good idea to
send a letter to the residents at risk and inform them of the
state's concern and the City's plans to deal with the situation
� should it arise.
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FRIDLEY CITY COUNCIL MEETING OF DECEMBER 9, 1991 PAGE 13
Mr. Hill, Acting City Manager, stated that he had intended, if the
threat continues, to publish a news release in the SunFocus
identifying the residents at risk.
Mr. Flora, Public Works Director, stated that this issue has been
discussed with the Emergency Management group.
Councilman Billings felt this is something that needs to be watched
and monitored throughout the winter.
11. CLAIMS:
MOTION by Councilman Billings to authorize payment of Claim Nos.
40578 through 40676. Seconded by Councilman Schneider. Upon a
voice vote, all voting aye, Mayor Nee declared the motion carried
unanimously.
12. LICENSES:
MOTION by Councilman Schneider to approve the licenses as submitted
and as on file in the License Clerk's Office. Seconded by
Councilman Billings. Upon a voice vote, all voting aye, Mayor Nee
declared the motion carried unanimously.
13. ESTIMATE•
MOTION by Councilman Fitzpatrick to approve the estimates as
submitted:
Rainbow, Inc.
7324 - 36th Avenue North
Minneapolis, MN 55427
.5 MG Water Tank Painting/Altitude Valve
& Vault Installation Project No. 212
Estimate No. 4 . . . . . . . . . . . . . . . $12,593.58
Seconded by Councilman Sohneider. Upon a voice vote, all voting
aye, Mayor Nee declared the motion carried unanimously.
ADJOURNMENT:
MOTION by Councilman Billings to adjourn the meeting. Seconded by
Councilman Schneider. Upon a voice vote, all voting aye, Mayor Nee
declared the motion carried unanimously and the Regular Meeting of
the Fridley City Council of December 9, 1991 ad�ourned at 9:15 p.m.
Respectfully submitted,
Carole Haddad
Secretary to the City Council
Approved:
William J. Nee
Mayor