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CCM 10/14/2013 CITY COUNCIL MEETING CITY OF FRIDLEY OCTOBER 14, 2013 The City Council meeting for the City of Fridley was called to order by Mayor Lund at 7:04 p.m. ROLL CALL: MEMBERS PRESENT: Mayor Lund Councilmember Barnette Councilmember Saefke Councilmember Varichak Councilmember Bolkcom OTHERS PRESENT: Scott Hickok, Community Development Director James Kosluchar, Public Works Director Darin Nelson, Finance Director/Treasurer Wally Wysopal, City Manager Darcy Erickson, City Attorney Paul Hyde, Fridley Land LLC Melvin Krugerud, 7356 Hayes Street NE Leslie Rolstad, 7471 Jackson Street NE Charline Wade, 1564 – 75th Avenue Pat Belland, Unity Hospital Jerry Anderson, Jamb Architects APPROVAL OF PROPOSED CONSENT AGENDA: APPROVAL OF MINUTES: 1.Special City Council Meeting of September 23, 2013 APPROVED. 2. City Council Meeting of September 23, 2013 Mayor Lund referenced page 6, paragraph 2, fourth line, should read that $158 is the amount for the Mayor only. APPROVED AS CORRECTED. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 2 NEW BUSINESS: 3. Receive the Minutes from the Planning Commission Meeting of September 18, 2013. RECEIVED. 4. Special Use Permit Request, SP #13-09, by ELO Engineering, Inc., on Behalf of Owczarzak Investment, LLC, to Allow Limited Outdoor Storage, Generally Located at 7770 Ranchers Road; and, Resolution Approving Special Use Permit SP #13-09, for ELO Engineering, Inc., on Behalf of Owczarzak Investment, LLC, the Property Owner for the Property Located at 7770 Ranchers Road N.E. (Ward 3). APPROVED SPECIAL USE PERMIT NO. SP#13-09; AND ADOPTED RESOLUTION NO. 2013-52. 5. Special Use Permit Request, SP #13-10, by Michael Bizal, of Bizal, Inc., to Allow Limited Outdoor Storage, Generally Located at 7880 Ranchers Road; and Resolution Approving Special Use Permit, SP #13-10, for Bizal, Inc., on behalf of Michael J. and Barbara J. Bizal, the Property Owners for the Property Located at 7880 Ranchers Road N.E. (Ward 3). APPROVED SPECIAL USE PERMIT, SP #13-10; AND ADOPTED RESOLUTION NO. 2013-53. 6. Resolution Supporting the Submission of a Grant Application to the Department of Employment and Economic Development (DEED) for the Redevelopment of 4800 East River Road N.E. (Ward 3). THIS ITEM WAS REMOVED FROM THE CONSENT AGENDA AND PLACED ON THE REGULAR AGENDA. 7. Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account for the Redevelopment of 4800 East River Road N.E. (Ward 3). ADOPTED RESOLUTION NO. 2013-54. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 3 8. Resolution Confirming the Statutory Level of Tort Limits. Wally Wysopal , City Manager,stated this is a $500,000 individual and $1.5 million aggregate claim. This is something the League of Minnesota's Insurance Trust, of which the City is a member, requires on an annual basis. ADOPTED RESOLUTION NO. 2013-55. 9. Resolution Directing Preparation of the Assessment Roll for the 2013 Tree Removal/Lateral Repair. ADOPTED RESOLUTION NO. 2013-56. 10. Motion to Receive the Fiscal Year 2014 Budget for Twin Cities Gateway. RECEIVED. 11. Appointment: City Employees Wally Wysopal , City Manager,stated there are four internal promotions. The first one is Jeff Jensen to the position of Public Works Operations Manager for Parks and Street. He has been with the City for 20 years. This is a consolidation of two positions into one. Mr. Jensen has previous private sector experience and will be reporting directly to the Public Works Director. Mr. Wysopal stated the second appointment is for the appointment of Richard Perron as a Lead Worker in the Parks Division. Mr. Perron has 8 years of service with the City, and with Presbyterian Homes, White Bear Lake Schools, and the City of Dellwood. He will be reporting directly to Mr. Jensen. Mr. Wysopal stated the third appointment is of William (Bud) Zerbey who has been with the City for 21 years in a number of different capacities, the most recent with the City's Street Department. He has also worked at Rosacker’s and the Mosquito Control District. He attended St. Cloud University as well as Anoka-Ramsey, and is a graduate of Fridley High School. He will be also be reporting directly to Mr. Jensen. Mr. Wysopal stated the last appointment is a promotion for Walt Messer as Fire Captain. He has been with the City for 14 years and has been a full-time firefighter since 2006. He has served as Acting Captain since March of this year and was fulfilling the duties of Kevin Swanson who retired. Mr. Messer attended Normandale Community College and also works for the City of Brooklyn Park in the Fire Department. APPROVED. 12. Claims (161221 - 161480). APPROVED. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 4 13. Licenses. APPROVED THE LICENSES AS SUBMITTED AND AS ON FILE. 14. Estimates Ron Kassa Construction 6005 East 250th Street Elko, MN 55020-9447 2013 Miscellaneous Concrete Project No. 429 Estimate No. 4..............................................$ 14,222.93 Northwest Asphalt, Inc. 1451 Stagecoach Road Shakopee, MN 55379 2013 Street Rehabilitation Project No. ST2013-01 Estimate No. 4..............................................$ 62,057.93 Midwest Asphalt Corp. 5929 Baker Road Suite 420 Hopkins, MN 55345 2012 Street Rehabilitation Project No. ST2012-01 Estimate No. 9..............................................$ 45,990.00 APPROVED. APPROVAL OF CONSENT AGENDA: Councilmember Bolkcom asked that Item No. 6 be removed. MOTION by Councilmember Barnette approving the proposed consent agenda with the addition of Item No. 6. Seconded by Councilmember Varichak. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. ADOPTION OF THE AGENDA: MOTION by Councilmember Bolkcom to approve the agenda with the addition of Item No. 6. Seconded by Councilmember Saefke. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 5 UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. OPEN FORUM: No one from the audience spoke. NEW BUSINESS: 6. Resolution Supporting the Submission of a Grant Application to the Department of Employment and Economic Development (DEED) for the Redevelopment of 4800 East River Road N.E. (Ward 3). Councilmember Bolkcom asked how much time is spent by the City to provide the status reports and how much time would that take up in the next four years? Scott Hickok , Community Development Director, said staff is familiar with tax-based revitalization grants, and there have been a number in the past. Mr. Hyde's project on Onan- Murphy was a good example. There are some administrative tasks the City needs to do. In terms of time over the course of a grant period, annually, the City has a grant report that it updates as to number of jobs created, new investments that have been realized as a result of this in terms of new building area, etc. It probably takes about 2.5 hours a year for the report. The developer provides a lot of the information for the City. Mr. Hickok these two resolutions (Item Nos. 6 and 7) will be taken on by Paul Bolin. These were given to the City Council tonight to endorse them and support the project. MOTION by Councilmember Bolkcom to adopt Resolution No. 2013-57. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. PUBLIC HEARING: 15. Consideration of a Rezoning Request, ZOA #13-01, by Fridley Land, LLC, to Rezone the Property from M-2, Heavy Industrial, to S-2, Redevelopment District, to Allow Flexibility with the Industrial Redevelopment of the Property, Generally Located at 4800 East River Road N.E. (Ward 3). MOTION by Councilmember Saefke to open the public hearing. Seconded by Councilmember Barnette. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE HEARING WAS OPENED AT 7:18 P.M. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 6 Mr. Hickok stated this relates to the Paul Hyde project at 4800 East River Road. He is requesting his property be rezoned. The property that is commonly known as BAE, FMC, or the Navy site is currently zoned M-2, Heavy Industrial. The rezoning would be to S-2, Redevelopment District. The purpose of this rezoning is to allow flexibility for both performance standards and uses within the future redevelopment on this site. Mr. Hickok stated the property is located south of 694 and east of East River Road. It was developed in the early 1940s as a manufacturing facility for gun mounts for the US Navy and was known as Northern Pump. In the 1960s, FMC Corporation purchased and operated the facilities. In the 1990s, FMC merged with Harsco Corp. and formed United Defense which became BAE Systems which still occupies the building today. Mr. Hickok stated the property is approximately 122 acres. The existing building was constructed in the early 1940s and is approximately 2 million square feet in size. That is the same square foot dimension roughly as the IDS Tower. Mr. Hickok stated some out buildings, parking areas, and landscaping also exist on the site. The redevelopment of this property includes the 83-acre Naval Industrial Reserve Ordinance Plan (NIROP). That is a superfund site. Mr. Hickok stated there is a 14-acre parcel directly south of the property, known as the FMC Superfund site, which was the subject of an investigation for waste disposal; and a significant soil and groundwater remedial action was undertaken by FMC at that property in the 1980s and continues today. That 14 acres is not included as part of this redevelopment project. Mr. Hickok stated in order to allow for the redevelopment of this property. An AUAR (Alternative Urban Areawide Review) was required to be completed by the consultant in accordance with the State's Environmental Quality Board rules. The City was the LGU (Local Government Unit) or the overseer of process during the review, and the document was ultimately approved by the City Council. The AUAR is very important because it focused attention on the environmental impact of a development such as looking at things such as fish, wildlife, ecologically-sensitive resources including water resources, erosion, sedimentation of soils, water quality of runoff, wastewater, geologic hazards, and soil conditions, solid wastes, hazardous waste, storage tanks, traffic, emissions, odors, noise dust, nearby resources, and visual impacts. Mr. Hickok stated local, state, and federal agencies were involved in the review of the AUAR. Generally speaking, the comments back were thoughtful and on point, but relatively few in number. All comments were made part of the official AUAR Record. Mr. Hickok stated types of comments back included things such as by full build-out of this development, the ramp entrances to 694 will need to be studied and potentially modified to accommodate the additional traffic. A driveway modification to the northern-most driveway onto East River Road will be required for the later phases of this redevelopment. Specifics for that modification are spelled out in the AUAR response letter submitted by the Anoka County Highway Department. A minor amendment to the City's Comprehensive Plan reflecting what its previous S-2 Zoning modifications have become will be necessary. Another comment to the FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 7 AUAR was that protection of nesting migratory species would need to be considered prior to the building's demolition. Mr. Hickok stated the range of the square footage for this development will be 1,591,860 square feet to 1,839,220 square feet. If they exceed that larger number, further AUAR analysis will be required. It is expected this development will fall safely between. Mr. Hickok stated the petitioner is planning to redevelop the property into 1.6 million square feet of new industrial buildings, in four phases. The development is being phased to accommodate the existing tenants in the existing building. They will start to see some nice photo illustration of the types of development this developer is accustomed to doing. Mr. Hickok stated the petitioner states he sees four phases happening: Phase 1 will occur on the south side of the existing building where there is a grassy area right now and some unused parking. It will consist of approximately 400,000 square feet; and that could be one or two buildings. Phase II of the redevelopment will occur on the north side of the existing building, and will consist of 1 to 3 buildings, totaling 400,000 square feet. Phases III and IV will occur once the existing leases within the existing building have expired and the existing 2 million square feet building is demolished. Phases III and IV will consist of approximately 400,000 square feet of building each. The entire redevelopment is expected to take 5 to 7 years to complete. Mr. Hickok stated the landscape on the site has been an important part on this developer's strategy. He has already had his landscape architect take a look at the site and study what was native to this property before it was developed in 1940 so they can bring back some of that natural environment and create a very nice work environment for the industrial complexes as well. Mr. Hickok stated staff recommends approval of this rezoning from M-2, Heavy Industrial, to S-2, Redevelopment District, with the following fifteen stipulations: 1. The applicant shall obtain all necessary permits for each phase prior to construction including, but not limited to, building, land alteration, and sign permits. 2. The proposed project and phasing shall meet all Building code, Fire code, and ADA requirements. 3. City engineering staff will review and approve grading, drainage and utility plans prior to issuance of building permit for each phase or building. 4. A storm pond maintenance agreement shall be required for each pond in the overall development. The uncertainty related to future phase's layout will require a storm pond agreement tied to each phase and submitted for approval, prior to issuance of any building permits in that related phase. 5. Landscape and irrigation plan to be reviewed and approved by City staff prior to issuance of building permit for each phase or building. 6. The petitioner shall pay all water and sewer connection fees prior to issuance of a building permit for each phase or building. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 8 7. Bicycle/pedestrian connections between buildings within project and to the adjacent regional park shall be incorporated into the Master Plan. Bike racks shall also be provided for each building in the development 8. The petitioner shall comply with any requirements set forth by the Anoka County Highway Department or the Minnesota Department of Transportation. 9. Costs for modification to site access at East River Road and this site's redevelopment related signalization enhancements shall be borne by the developer. 10. Due to the complexity of this redevelopment and ultimately the number of unknowns related to who will be new tenants or owners of buildings and what their specific needs will be, the developer shall be required to keep each phase of this development within 10 percent of that square foot dimension that is shown for each phase in the Master Plan. This means there may be a modification in shape and size of buildings in each phase, but overall that phase cannot deviate from the Master Plan square foot dimension by more than 10 percent. Those changes when necessary reviewed and approved by the Planning Commission and City Council. 11. Each phase should generally comply with the most similar zoning district performance standards. 12. An increase in overall square footage beyond 1,839,220 square feet will require AUAR revisit. 13. No park fee is required, as a result of land dedication for park by the original owner of this site. 14. The petitioner shall maintain a vegetative cover on all excavated areas awaiting building construction. 15. A development agreement between the Developer and the City for all public/private site improvements including, but not limited to, streets, utilities, and landscape shall be approved for the overall development, prior to issuance of a building permit for the first building in Phase I. Councilmember Bolkcom asked what RAP meant. Mr. Hickok replied Response Action Plan. It is referred to quite often on clean-up projects like this. It is the Response Action Plan related to the environmental issues that have been discovered. The RAP has to be approved by the MPCA before you can move ahead with the actual clean-up. Councilmember Bolkcom stated, so the RAP is approved by the Minnesota Pollution Control Agency. It does not need any approval at the city level. Mr. Hickok replied yes. Councilmember Bolkcom stated there are all these buildings and all these different phases. As long as the number at the very end is less than the 10 percent, the City is okay. If they get someone who wants to build a 400,000 square foot building, that would not cause a reason for FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 9 the petitioner to come back as long as the whole project stays under the number in the stipulation and is not increased more than 10 percent. Mr. Hickok replied, correct. Councilmember Bolkcom said it does not really matter if one phase is only 350,000 square feet and the next one is 450,000, as long as it stays under that 10 percent increase. Mr. Hickok replied true. It provides the developer flexibility because there are a lot of unknowns about the market and what the eventual buildings will be. Councilmember Bolkcom asked if the master plan would go into any details on what kind of uses they see there or mainly just what lighting and the landscaping, etc. will be? She asked what it would involve. Mr. Hickok replied the development agreement typically talks about the physical infrastructure, where private utilities meet public utilities, and where improvements are being made. The City wants to make certain these are finished improvements. Developers and their civil engineers are very good at doing this. In the instance where you would have a conflict on how this is all to work, the development agreement is meant to basically tie it all together and say here is what happens in these situations and how we should move forward. Councilmember Bolkcom asked, regarding Stipulation No. 8 which says petitioner shall comply with any requirements set forth by Anoka County Highway, right now no one foresees changes in East River Road regarding traffic and the turn lanes. Does that go per phase? Mr. Hickok replied it really goes back somewhat to what the site was planned for initially. Back at the full development, there were 6,000 vehicles with their associated average daily trips; and the way the site was laid out the driveways were really adequate for how that building would fill up in the morning and people would leave in the evening. This is going to be phased a little bit different. The County Highway Department and their experts have already taken a look at it. Mr. Kosluchar has taken a look at it. One driveway will need to be modified before full buildout. Councilmember Bolkcom stated those things are a little confusing to her. Obviously the traffic on I694 and East River Road has increased over the years. How much does that enter into this and, at if there needs to be improvements made for traffic signals, who incurs those costs? Mr. Hickok replied, there is a stipulation that says, of course the developer needs to follow the mandates of the Anoka County Highway Department and MnDOT and, if adjustments need to be made for the signalization, those costs would be borne by the developer. Councilmember Saefke stated he did not see in the stipulations anywhere regarding contacting the Mississippi Watershed Management Organization (MWMO). This ties in with No. 4, the storm retention pond. He encouraged the developer to contact them because they will provide some technical information and perhaps applicable suggestions. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 10 James Kosluchar , Public Works Director, replied there have been conversations with the MWMO so far about the property and, at the time a concept plan is developed which they are getting to here, they are interested in that conversation. City permits under the MWMO rules, the MWMO is not a permitting agency; therefore, the City will be working with MWMO as well. Councilmember Saefke stated that is good because he knows one of the major problems the MWMO and other watershed organizations have is that they usually get the plans on the tail end, and it is too late to do anything. Councilmember Bolkcom asked once this is done, what will everyone see on the site? Mr. Hickok replied he will leave part of that answer to the developer. With the flexibility of the S-2 and also the phasing of this with some adjustment opportunities there, the 10 percent either direction, was a good thing. They are going to see some rather large development here with a lot of new jobs and opportunities. It will be a very high-tech development with state of the art industry and appearance to an industrial complex that will be a very nice addition to the City of Fridley. Councilmember Bolkcom mentioned the report related to making some minor amendments to the Comprehensive Plan related to the zoning to the S-2. She asked what was involved. Mr. Hickok replied that is a result of the Met Council's response to the City in the AUAR. They are saying they understand that this S-2 development is a unique zoning for Fridley. It is a bit like a planned unit development type zoning. However, when a development then has been zoned S-2 and then is built out, what the Met Council asked is if the City could tell them what those sites have become. For example, Medtronic’s World Headquarters campus is an S-2. The Fridley Municipal Center with its neighboring buildings is an S-2. They have asked the City now on its S-2 sites to identify what those became and to be specific. Councilmember Barnette asked if the petitioner or Mr. Hickok could give them two or three different examples of the type of industrial building that might go there. Paul Hyde , Fridley Land LLC, stated he will tell them a bit about what they have been working on the past two years. They are going to see Council many more times over the next two to five years as this redevelopment unfolds. Last time they met they talked about getting through the regulatory issues with both the EPA and the State Pollution Control Agency. They are in great shape there. They have now closed on the site. They bought it on July 10. They have a development agreement approved which will help them through the redevelopment, and the next thing they are working on is their applications for grants to help clean up what they found on the south part of the site. Those applications are due November 1. Last week they heard news that they received a $500,000 redevelopment grant from DEED. There were 24 applications including the St. Paul Saints stadium. It is very, very competitive. They were fully funded on that grant application. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 11 Mr. Hyde stated they started marketing the project six to eight weeks ago. They branded it as the Northern Stacks after the stacks with the Naval battle E on it. They have great response so far. He sees great activity out there in the market. They are actively talking to a number of different users, from warehouse distribution companies that serve companies both in the metro area and Fridley. They also have a number of medical companies and manufacturing companies with high office finish and great jobs they are talking to. Frankly, his issue is going to be trying to deliver more land sooner to meet the market demands and they are able to deliver now with some of the existing leases in place. Mr. Hyde stated they will probably see the Council on site plan approvals maybe as they get through each building. They will be coming through here on site plan approvals and hopefully having some groundbreakings happening in the spring. Then, knock on wood, some good news on grant applications coming in the end of December, probably January, for that first phase of redevelopment for those clean-up grants they are applying for. Councilmember Bolkcom asked what happens if those grants for the clean-up do not happen? Mr. Hyde replied what they try to do with the help and attention of the HRA is build in some different backstops in case that happens. They have some tax increment that can happen, along with redevelopment grants they were awarded along with grant funds. They are trying to make sure there is not one thing that is going to slow the project down. Nevertheless, they very much want and need those grants. They spend a great deal of time with DEED and Met Council. They will see them again on Monday out at the site to discuss their applications and get their feedback; and they think they will score well in terms of creating jobs, tax base, and pollution clean-up. For the dollars they are asking them to invest, with the bang they are going to deliver, they are optimistic they will get a good result. Mayor Lund asked Mr. Hyde to remind them a little bit about the known pollution site there. The past "polluters" are responsible for remediation and continuation of that. Therefore, why, as there now has been identified up to $12 million of other clean-up costs, are those polluters not paying for that additional clean-up as they become aware of it? Mr. Hyde replied this is their fourth State and Federal superfund site they have redeveloped. They have run into the same factual circumstance on every site. This is a broad, national trend which is what created this industry of redeveloping a site. The answer is that vis-á-vis US EPA and State of Minnesota Pollution Control Agency, the Navy is done with the soils on the site. They are responsible for operating the groundwater system which they will control for as far as they can see into the future. Any incremental new issues they run into, are the redeveloper's issues. As they touch the dirt, because of their redevelopment, they have to move it around and put it in different places. That is a development-related expense, not a Navy pollution-related expense, which is the way most of these redevelopments work. They spent a year trying to lay the groundwork for that as it relates to regulatory oversight of their clean-up as well as who is responsible for what. It is a very typical outcome. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 12 MOTION by Councilmember Bolkcom to close the public hearing. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE HEARING WAS CLOSED AT 7:49 P.M. 16. Consideration of the Proposed Assessment for 2013 Street Improvement Project No. ST2013-01. MOTION by Councilmember Saefke to open the public hearing. Seconded by Councilmember Bolkcom. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE HEARING WAS OPENED AT 7:49 P.M. Darin Nelson , Finance Director/Treasurer, stated the project assessment pertains to the mill and overlay of City streets as part of the City’s street resurfacing plan. The 2013 Street Improvement Project improved the areas of Meadowmore Terrace and Flanery Park neighborhoods, along with Jackson Street. Mr. Nelson stated the total number of properties in this assessment is 344. The total assessed cost is $714,156.38. Each single-family residential property is proposed to have an assessment of $2,074.45. Assessments were originally estimated at approximately $2,100. The assessment payback period is over a period of ten years. Interest rates are at 5.25 percent. The City calculates interest rates based off the federal prime rate. They use 2 percent over prime. The primate rate has been at 3.25 percent for the past several years. Mr. Nelson stated property owners have until the close of business on November 27 to pay all or a portion of their assessment interest free. The City did receive one formal notice contesting the assessment late in the afternoon today which he handed out to Council. Mr. Nelson stated there is a deferral option available to retired and/or disabled property owners, and must be for a homesteaded property. Property owners should contact the Finance Department if they have an interest in that. His number is 763-572-3520. To be eligible for this deferral a person must be 65 years old or retired by virtue of permanent or total disability. The application must be filed with his office within the next 30 days. There are income guidelines. The annual assessment payment cannot exceed 1 percent of a person’s adjusted gross income or the household income must be below the very low income threshold as defined by the Community Development Block Grant. He does have that information. One caveat to this is interest does accrue during those deferrals. MOTION by Councilmember Bolkcom to receive a two-page letter dated October 4, 2013, by Thomas and Sandra Kallroos. Seconded by Councilmember Varichak. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 13 UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. Councilmember Bolkcom said the letter was dated October 4, and asked if the City received it today. Mr. Kosluchar replied they received it in the Engineering Department today. Mayor Lund asked Mr. Kosluchar if the photos he provided were recently taken. Mr. Kosluchar replied the photographs were taken today. Mayor Lund stated regarding the photos attached to the Kallroos letter, he is not sure what they are from. They had a sinkhole or did have one and they are claiming that after the street reconstruction, it is not clear what they are showing there. It looks like there is a lot of gravel on it or it is not a complete street. Councilmember Bolkcom stated it looked like it is growing grass. Mayor Lund stated there is grass in the seam of the concrete between the driveway and the curb. Mr. Kosluchar stated he has not been involved with this. He believed Layne Otteson was involved. What Mr. Kosluchar observed out there today was a slight difference in height between the driveway and the curb which obviously existed before the project. The curb was not replaced as part of the project. The term "sinkhole" is probably an overstatement of the problem there. He guessed that was talked about with Mr. Otteson at the preliminary workshop. If someone says they have a sinkhole and they have drainage problems in front of their house, typically those are things they go after with the curbing budget. He looked at it today and with the naked eye, from the pictures it is a fairly good grade. There is really not a problem with the curb. There may be a problem with the elevation, maybe about an inch between the driveway and the curb. Whether that is a heaved driveway or a settled curb, he could not tell them. Maybe it is something they can work on with the owner. Mayor Lund stated it is really not the road that is of issue with the homeowner. It is more of the gap, separation, or differentiation behind the concrete curb and his personal driveway. Mr. Kosluchar replied, correct. Mayor Lund stated and the Kallroos’ expectation is that the curb would be raised or a new curb would be put in or a section of their driveway would be corrected to make a more seamless transition. Mr. Kosluchar replied his guess expectation was maybe they raise the curb up to this driveway. Mayor Lund stated the curb is in alignment with the rest of the curb in both directions. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 14 Mr. Kosluchar replied it appears to be. Mayor Lund stated raising one section of curb is not going to really address the problem. Councilmember Bolkcom stated his looks really deceiving then, because it sure looks like there is hump there. Mr. Kosluchar replied and that is prior to the project being done. Councilmember Bolkcom stated if Mr. Otteson actually talked to them, someone should talk to them about what is going on and that the City is not going to do anything. That is something they preach. Every time she goes to a street meeting, they say if you have a question, whether they call it a sinkhole or not, someone should get back to them. She asked if they ran out of money and if that was why it was not being fixed. Mr. Kosluchar stated regarding the cost issue, the City does have a budget for curbs in the project. Sometimes it does get stretched a little bit for minor issues. They would have to replace a whole curb section of their driveway, maybe 25-30 feet of curb and on both sides as well. It is a pretty expensive cost, about $20 a foot to correct a real minor problem. There are other ways to correct it. Councilmember Bolkcom asked what they were. Mr. Kosluchar replied there are probably two ways--to rebuild the curb or cut a panel and replace the panel. Councilmember Bolkcom asked if someone should have gone out and talked to them. Mr. Kosluchar replied they will do that. He does not know what the communication was after that point. Councilmember Bolkcom stated but the City has change orders all the time, too, if it really needed to be done to correct it. Mr. Kosluchar replied they will not replace the curb though. In order to do that they would have to cut the mat and they will not do that. Councilmember Saefke stated his other suggestion is they can talk to Don Roberts who is quoted in the letter with what appears to be a bogus answer. Because there is such a difference between the photographs attached to the letter and Mr. Kosluchar's, his thought was this must have been prior to the project because the mat on the street on Mr. Kosluchar's photographs is nice and smooth. Mayor Lund asked about grinding that panel? Mr. Kosluchar replied that is a real cost-effective option. Is grinding or cutting. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 15 Mayor Lund stated he does not know how big of a gap is there in the area where the grass is growing. Is it a fairly significant gap? Mr. Kosluchar replied, he honestly cannot say there is a gap. The vertical separation was probably about an inch. He did not put a tape on it. They will follow up with the owner. The conversation mentioned in the letter may have been part of the conversation, but it likely was not all of the conversation. Councilmember Bolkcom asked what the City normally does when someone comes to them with comments like that. Mr. Kosluchar stated Mr. Roberts probably has a log of these conversations. Councilmember Bolkcom said because this is a public hearing and there is an assessment roll after this, she is sure the couple is asking if they should pay their assessment and if the City will help them out. Does the City need to help them out? In the past, if someone has not been happy, they fix it before they assess them. Does the roll have to be approved tonight? Mr. Nelson stated he recommends the roll be approved tonight, in total. If they want to take specific action to one P.I.N. they could. Councilmember Bolkcom asked, is tonight the last night it can go in? When does it have to get to the County? Mr. Nelson replied, by November 27. It has to be submitted within 30 days. In reality they could approve it at the next Council meeting because they would still have 30 days. Councilmember Bolkcom asked if they could approve the whole roll without the one number, unless there are others in the audience. Darcy Erickson, City Attorney, stated she concurs with Mr. Nelson that they approve the roll as presented. If there is any corrective action perhaps try and do that. Mr. Kosluchar stated they typically do get comments on restorations. There are items that are to be dealt with, including those with the contractor as well on the job. This is nothing that was called out in the plans the contractor was supposed to do. Mr. Nelson asked the City Attorney, if they have to give 30 days of an interest-free waiver after the assessment roll is certified, are they cutting it close. Attorney Erickson replied they are cutting it very close. Mr. Kosluchar stated he does not think this issue has a bearing on the assessment, the improvements, and the benefit of those improvements. Curb corrections were done for drainage only. In addition, the curb is not a part of the assessment for the project. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 16 Mayor Lund asked Mr. Kosluchar does he see, in his professional opinion, any fault or default of the work that was contracted to be performed. It is more of an issue that the curb in the Kallroos' driveway has actually dropped, heaved, etc., over time. Mr. Kosluchar replied, that is correct. Councilmember Varichak asked when they first had their meeting, did this couple ever mention they had this problem before this was all done. Mr. Kosluchar replied, according to their letter, yes. Melvin Krugerud, 7356 Hayes Street N.E, stated he lives in the center of the block on the west side. This is pertaining to the storm sewer. When they first put the curbing in, he spoke with the engineer on the job. They took a big chunk out of there. It was hit with a pay loader. He was very upset because at that time it was never taken care of. Apparently the City did not even know about it. The contractor avoided him. He made up his mind this time around that is going out of there and it is going to look decent. He called someone in the Engineering Department and told him he needed to come to 73rd and Hayes, and that he wanted this problem taken care of. The man told him everything was taken care of. Mr. Krugerud replied, no, it was not. Not to his satisfaction. The man said he would be over in ten minutes, and he was. The man was going to snow him under that it was not going to be done. In about a four-foot width or so there were three cracks in the concrete right across. He pays for it and it should be taken care of. The man told him that will never go. He said he told the man, it is going to go. He wants it replaced. As long as the City is doing the job, it should get done now and not three or four years down the road. The man said, he will be back. Half an hour later he came back and told him they were going to replace the concrete. The City did put in a much wider inlet. Leslie Rolstad , 7471 Jackson Street N.E., stated she has no issues with the assessment. She just came to see that the proposal was passed, and she did not expect to see any changes in the amount in the future. Mr. Nelson stated if the assessment is certified tonight, the City will be sending out courtesy letters in the mail tomorrow or the next day with the actual assessment amount. Councilmember Varichak asked about the differences in the amounts. Mr. Kosluchar stated he believed there was one commercial property on the project and, in addition, they have a duplex. They pay one and one-half times the formula. Carra Wade, 1564 – 75th Avenue, stated when this first started, she was pretty sure they would pay in January, 2014. She was quite surprised to see in their last letter it was moved to November. It does seem logical to do it before the holidays. Mr. Kosluchar replied, typically October, November, or December is when they have this hearing and when they can do that prepay. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 17 MOTION by Councilmember Varichak to close the public hearing. Seconded by Councilmember Barnette. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE PUBLIC HEARING WAS CLOSED AT 7:49 P.M. NEW BUSINESS: 17. Resolution Adopting the Assessment for 2013 Street Improvement Project No. ST2013-01. MOTION by Councilmember Varichak Adopting Resolution No. 2013-58. Seconded by Councilmember Saefke. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 8. Special Use Permit Request, SP #13-11, by Joint Venture, LLC, Benedictine Health 1 and Allina Health, for North Suburban Hospital District (Unity Hospital) to Allow the Construction of a New Transitional Care Facility on the Unity Hospital Campus, Generally Located at 520 Osborne Road (on the Property Located at 550 Osborne Road, Unity Hospital); and Resolution Approving Special Use Permit, SP #13-11, for Joint Venture, LLC, on Behalf of North Suburban Hospital District, the Property Owner of the Property, Generally Located at 550 Osborne Road N.E. (Ward 1). Scott Hickok, Community Development Director, said petitioner is seeking a special use permit to construct a new conditional care facility on the Unity Hospital campus. The proposed building will be located on the south side of the existing building and is intended to be connected to the hospital building via skyway at some point in the future. Mr. Hickok stated Allina Health (Unity Hospital) is partnering with the North Suburban Hospital District and Benedictine Health Systems to build a transitional care facility to be called "Interlude" on the Unity Hospital campus. The proposed building will be a therapy facility where guests can have close access to the hospital, while not occupying a typical hospital room for their ongoing therapy. Mr. Hickok stated it will be a three-story building, 45,087 square feet, and consist of 38 private guest units, 2 semi-private guest units with two beds in each unit, and 8 care units, for a total of 50 skilled nursing beds in this building. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 18 Mr. Hickok stated the exterior facade will consist of a variety of materials intended to complement the hospital campus and the residential areas across Lyric Lane. At the hospital end of the building, it has a commercial appearance and on the south end, it appears as a three-story residential complex. Mr. Hickok stated hospitals, clinics, and nursing homes are permitted special uses in the R-1 zoning district; and modification to the campus requires that a new special use permit be approved. As a result, the existing request has been submitted. There are 72 parking stalls that will be removed because of the construction of this building. The transitional care facility requires 50 parking stalls. The petitioner plans to replace those 72 plus 56 stalls for this facility. By expanding the parking to the west and southwest of this new building they will accomplish that. Mr. Hickok stated the proposed expansion meets lot coverage and setback requirements. All storm water, drainage, and landscape comply with City Code requirements. Mr. Hickok stated the Planning Commission held a public hearing on this item on September 18. They unanimously recommended approval with 11 stipulations. Mr. Hickok stated staff recommends concurrence with the Planning Commission. Councilmember Saefke asked whether anyone in the neighborhood has been notified of the proposed construction. Mr. Hickok replied the property owners within 350 feet of the edge of this property were notified; and the City did put a hearing notice in the paper as well. Mr. Hickok replied there were a couple questions about what the project is. There were no comments for or against. Councilmember Varichak asked if they were taking out the heli pad. Mr. Hickok replied yes. Councilmember Varichak asked where it was going. Pat Belland , Unity Hospital, stated they have spent a significant amount of time looking at this, and their plan is to use the Blaine airport. They will not be replacing the heli pad. MOTION by Councilmember Saefke to approve Special Use Permit Request, SP #13-11, by Joint Venture, LLC, Benedictine Health and Allina Health, with the following stipulations: 1. The petitioner shall obtain all necessary permits prior to construction. 2. The petitioner shall meet all building, fire, and ADA requirements. 3. The petitioner shall comply with the Fire Marshal's plan review comments dated September 4, 2013. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 19 4. City engineering staff to review and approve grading, drainage, and utility plan prior to issuance of a building permit. 5. The petitioner shall receive Coon Creek Watershed District approvals prior to issuance of a building permit. 6. A stormwater maintenance agreement shall be filed with the City prior to issuance of a building permit. 7. Landscape and irrigation plan to be reviewed and approved by City staff prior to issuance of building permit. 8. Future additions/expansions on this site shall be reviewed by City staff and a determination shall be made regarding the need for a strategic plan for structured parking. If sufficient additional parking is required based on the addition, a structured parking plan will be required. 9. Pedestrian crosswalk shall be established to accommodate safe pedestrian movement between the proposed building and the other buildings within the Unity Hospital campus. 10. The petitioner shall agree to preserve mature trees to the extent possible. All trees required to be removed for parking shall be marked and approved by City staff prior to issuance of a building permit. 11. A new compost area for the community garden shall be identified on the site plan, shall be screened from neighboring residential properties, and meet all other Code requirements related to composting. and to adopt Resolution No. 2013-59. Seconded by Councilmember Barnette. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 19. Vacation Request, SAV #13-03, by Jamb Architects, for Donald Gamboni, to Vacate 79th Avenue, West of Hickory Street, which will Allow for a Parking Lot and Building Addition, Generally Located at 7890 Hickory Street N.E.; and Resolution Vacating and Reserving a Portion of 79th Avenue West of Hickory Street to the Burlington Northern Sante Fe Railroad Tracks. Generally Located North of 7890 Hickory Street N.E., Petitioned by Donald J. and Judith M. Gamboni, the Property Owners of 7890 Hickory Street N.E. (Ward 3). th Mr. Hickok stated the petitioner is requesting a vacation of a portion of 79 Avenue, west of Hickory Street to the Burlington Northern Sante Fe railroad tracks. Mr. Hickok stated for the City to consider the street vacation, City staff had the petitioner obtain signatures from the two owners to the north. The City received signatures from both Park Construction and Ryan Companies, stating they agree to the requested street vacation.As a FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 20 point of interest,Burlington Northern Sante Fe had indicated their willingness to allow that to be vacated in the past as well. Mr. Hickok stated the petitioner is also seeking a variance to reduce the side yard setback on the corner lot from 25 feet to 12 feet to allow the construction of a building addition on the east side of this building. Mr. Hickok stated with a variance it is important to talk about what is unique about this site and what is the condition here. The petitioner's summary of the hardship states, "Unfortunately, we cannot expand our building to the west or to the south due to the multitude of utility easement and lot size restrictions. Some of the utilities also restrict the height of the building. This leaves us with the only possible expansion to be on the north and east side of the lot in the setback area." Mr. Hickok stated the property is zoned S-3, Heavy Industrial, Onaway Addition. Vision Woodworking operates their business out of three buildings, all on Hickory Street (7890, 7891, and 7871 Hickory Street). They have outgrown their building and are in need of expanding. This is a fascinating business. They do beautiful art-grade millwork. Mr. Hickok stated approving the street vacation and variance request will allow the building addition to the east and north of the existing building as well as the construction of additional parking along the north side of the property. Mr. Hickok stated the City's Public Works staff is in agreement with the street vacation provided utilities within the right-of-way are protected through vacation resolution. The petitioner has been working with Burlington Northern to get their signature on the vacation request and, at this point, they do not have anything in writing. However, from their discussions with Burlington Northern Sante Fe, the petitioner states that BNSF is not opposed to the vacation, provided they are allowed a 30-foot street access easement which Vision Woodworking has agreed to do. Mr. Hickok stated the variance is being sought to reduce the side yard setback from 25 to 12 feet. Practical difficulties do exist on the subject property the City believes based on (1) the shape of the lot, (2) the fact that it is surrounded by right-of-way, and (3) there are a multitude of utility easements that run north and south along the west side of this property. He does not know of any other property that has this same set of conditions. It does lend itself to practical difficulties for sure. Mr. Hickok stated the Planning Commission held a public hearing for a street vacation on September 18. They unanimously recommended approval of the request upon the City's reservation of a permanent drainage and utility easement and provided Vision Woodworking agrees to record an access easement to neighboring property owners. Mr. Hickok stated the Appeals Commission held its public hearing for the variance on October 2. They unanimously recommended approval of the request. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 21 Mr. Hickok stated City staff recommends concurrence with the Appeals Commission and approval of the resolution for the vacation. Councilmember Bolkcom asked if the City was okay with the petitioner not having an agreement with Burlington Northern. Mr. Hickok replied, the City is okay with that. In earlier years, Burlington Northern has concurred. This is not the first time the petitioner has looked at vacation, and they have been given a verbal assurance which the City is comfortable with. They are going to provide them access to the site as well. They do not lose anything by this frankly. The cul de sac is a way basically for the City to get plow trucks turned around, etc. As long as the Burlington Northern has access to it, and both properties have access to it, he thinks the cul de sac was of the biggest benefit to the City. Councilmember Bolkcom asked the City Attorney, if the City is comfortable that there has been a case made that this is a unique lot and shape, etc. Attorney Erickson replied, she thinks this is one of a handful of classic practical difficulties because of the triangular shape of the property. That is pretty irregular. They do not see that very often. Also, it is compounded with difficulties because of the right-of-way that is around it. It is a different type of property that you do not see come along very often. Topography and unique shape are some of the most classic difficulties or hardships under the old statute but, with the new language, it makes improvement of the property more difficult and challenging. Mayor Lund asked by vacating the cul de sac on that street, does any portion of that remain public property? Does that get plowed or maintained by the City? Mr. Hickok replied, it would vacate everything west of Hickory to the Rail. No, there would not be any maintenance on the City's part. At this point, all of the parking area that would be an improvement to the site would also service the drive area and access back to those areas. It would be taken care of as part of their maintenance on their site. Mr. Hickok stated they may recall as the City vacates streets, typically half goes back to the north and half goes back to the south. That is the case here also. Ryan Construction and Vision Woodworking have worked out an arrangement. Park Construction would like to keep their piece, and it does not cause problems with them on their project. Councilmember Bolkcom asked the petitioner if he was familiar with the stipulations and okay with the stipulations both for the special use permit and the vacation requests. Jerry Anderson, Jamb Architects, replied, yes, we are. MOTION by Councilmember Bolkcom to approve Vacation Request, SAV #13-03, by Jamb Architects, for Donald Gamboni, and to adopt Resolution No. 2013-60. Seconded by Councilmember Varichak. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 22 UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 20. Variance Request, VAR #13-01, by Jamb Architects, for Donald Gamboni, to Reduce the Side Yard Setback on a Corner Lot from 25 Feet to 2 Feet to Allow a Building Expansion, Generally Located at 7890 Hickory Street N.E.; and Resolution Approving Variance, VAR #13-01, to Allow a 12-Foot Side Yard Setback on a Corner Lot where 25 Feet is Required, for the Property Generally Located at 7890 Hickory Street N.E., Petitioned by Donald J. and Judith M. Gamboni (Ward 3). MOTION by Councilmember Bolkcom to approve Variance Request, VAR #13-01, by Jamb Architects, for Donald Gamboni with the following two stipulations: 1. Approval of variance request, VA #13-01 for the petitioner, Jamb Architects, on behalf of Donald and Judith Gamboni, property owners of 7890 Hickory Street, is contingent upon the approval of street vacation request, SAV #13-03, requested by the same parties. 2. Recording of a private non-exclusive access easement granted by Donald J. Gamboni and Judith M. Gamboni, property owners of 7890 Hickory Street, over: That part of 79th Avenue N.E., dedicated in Onaway, lying west of the northerly extension of the west line of Hickory Street and easterly of the southerly extension of the westerly line of PARK SHOP, Anoka County, Minnesota to adjacent property owners, who are currently Burlington Northern Inc., Carlson Park Properties, and Ryan Companies US Inc. and to adopt Resolution No. 2013-61. Seconded by Councilmember Varichak. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY. 21. Informal Status Reports. There were no informal status reports. FRIDLEY CITY COUNCIL MEETING OF OCTOBER 14, 2013 PAGE 23 ADJOURN. MOTION by Councilmember Barnette to adjourn. Seconded by Councilmember Varichak. UPON A VOICE VOTE, ALL VOTING AYE, MAYOR LUND DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE MEETING ADJOURNED AT 8:52 P.M. Respectfully submitted, Denise Johnson Scott J. Lund Recording Secretary Mayor