Committee Minutes

MINUTES/FINANCE COMMITTEE
Tuesday, October 26, 1993 - 3:30 p.m.

Members present: Shores, McCabe.

1. Matter of ordinance amendment re. extended leaves and benefits
allowed for City employees.
Jay Graba, Personnel Officer, submitted policy relative to payment of unused annual leave upon termination of employment with the City; that policy developed rather than ordinance amendment based on recommendation of the city attorney. He reviewed the policy with the committee which gives the employee the option of either using his/her accrued annual leave, or taking all unused annual leave in cash upon termination; and method of payment of health insurance premiums for the employee for that period of time. Mike Shea, employee rep., expressed some concern relative to payment of insurance premiums, whether from health insurance fund or department budget, and recommended payment through department budget. It was noted that longest period of time which premium would be paid was 3 months. It was also noted that City will pay insurance premiums out of 1993 budget for employees terminating December 31 if funds are available in the department's budget. Moved by Shores and McCabe (that the personnel officer and the city attorney rewrite the last paragraph); and that we adopt the policy and its intent. Motion carried.

(Mr. Shores stated he will visit with Mr. Kulas and amend on the floor if necessary.)

2. Matter of leasing portion of NSP property to US Postal Service.
Dick Jackson, City Center Mall, reported he had visited with Postal Service reps, and they have agreed to limiting lease to 10 years, with renegotiation for 3 separate five-year periods. Mr. Howard Swanson, city attorney, reported he has copy of lease, which is 10-year lease with optional 5-year renewals at rate agreed upon. Mr. Jackson stated that the leased space is on back side of building facing parking lot (southeast corner of building), that he is writing grant for walkway and to make accessible from parking lot. He also noted that the Postal Service is reluctant to put in service window. Mr. McCabe stated he is afraid of getting locked into agreement as he has been discussing plans for Mall with other individuals.

Moved by Shores and McCabe that we authorize execution of lease with the U.S. Postal Service for 10 years as negotiated, at $4.00/sq.ft., with three five-year options with renegotiation. Motion carried.

3. Matter of lease with State Highway Patrol.
Mr. Swanson reported that the State Patrol has leased space in the Police Building for a number of years, base rate with escalator clause for maintenance, heating, lighting, water, sanitation service, etc.; that lease expired in June, 1993; that State sent standard lease and he objected to specific areas, re-drafted and
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sent lease back to the Highway Patrol, and they have rejected our
lease and listed specific reasons: 1) they don't want lease for term of more than one year; 2) they want to have fixed rate of rent; 3) they object to provision whereby City could terminate lease upon 30-days notice; 4) and they object to standard indemnification clause. He also reported that they want designated parking. Mr. Swanson stated that the local office has been extremely cooperative, and Chief Paschke has stated they are good tenants. After reviewing lease with committee and after further discussion Mr. Swanson stated that weighing usage of the space, doesn't see inordinate amount of risk there, they use for administration, and lease would have annual cancellation. It was moved by McCabe and Shores that we authorize proper City officials to enter into the lease, subject to final approval by the city attorney. Motion carried.

4. Matter of sidewalk cancellation on Lots 11 and 12, Block 23,
Budge & Eshelman's 3rd Addition by Don K. and Joann Cooksey
under low income section of Capital Improvements Plan.
Mr. Tingum, city auditor, reported that the applicant met income levels and qualifies for the exemption. Moved by McCabe that as the applicant qualifies for the exemption, that we cancel the assessments and that payment be made from Highway Users' Funds. Motion carried.

5. Matter of purchasing property adj. to River Road (Lot 36, Blk.
1, Auditor's Resubdivision).
Held in committee.

6. Matter of excessive rent increases.
Joseph Kampa read prepared statement, that he is not representing any group - only himself; that he has had rent increase 3 times in 3 years; that these raises were not justified to higher authority and reasons why rent increased were: 1) high property taxes, proposed water plant, and to make up for past losses. He stated that majority of renters are young people; and impacts large percentage of the population - 40%. Howard Swanson, city attorney, stated that in 1993 bill adopted by State Legislature which prohibits political subdivision from any rent control on privately owned property (exception - property owned and operated by political subdivision, i.e., HUD subsidized property). Mr. Kampa stated that it is responsibility of civic leaders to see that these laws, if impact large number of people, don't get passed. Moved by McCabe and Shores to receive and file. Motion carried.

7. Matter of change orders for City Hall project.
Mike Murie, EAPC, reviewed change orders with the committee:
a) G-26 - $10,790.00 net increase to contract (Peterson Construction), and change order comprises six separate smaller items in old part of City Hall, and includes request by contractor

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for additional 14 days time to complete the project; and b) M-6 - $12,153.00 (C.L.Linfoot Co.), change order comprised of 11 items. He noted that the contractor has not submitted change orders for several months but let pile up. He also reported that they have reviewed all change orders. He reported that there is $56,767.47 remaining from original funds (there is one item for phone panel relocation in the amount of $3,900 which is not included); that they are getting near the end of the project and council chambers has November 27 completion date.

Moved by McCabe and Shores to accept and authorize payment of the change orders. Motion carried.

8. Matter of purchase of Linnell building in Industrial Park.
John O'Leary, Community Development, reported that this is 15,000 sq.ft. pre-stressed concrete building on 48th Street in the Industrial Park, which was purchased from First Bank in 1986 by Development Foundation at cost of $203,000 to house Lystad's. He stated that the building needed some improvements and City applied for and received grant through Dept. of Commerce (EDA) in the amount of $50,000; that as a condition of the grant the Dept. of Commerce required that ownership of the building be transferred to the City of Grand Forks and that there be no liens or debt on the building; that the Development Foundation agreed to both conditions by transferring the mortgage to a number of industrial lots located in the Industrial Park and in return the City gave the Development Foundation the full management responsibility for the building and they collected and retained all rents which are more than adequate to service the debt. He reported that the Dev. Foundation has been successful in selling a number of lots, that each time a lot is sold, First Bank is required to release a portion of their mortgage, and they are now at a point where First Bank has informed the Development Foundation that no more lots would be released until the debt is satisfied. He reported further that the Development Foundation has asked the City to pay off the balance of the mortgage and release the Foundation from its management responsibilities, the unpaid balance of the mortgage is $168,572.54; the lease with Lystad's calls for a monthly rent of $2,368, for an annual payment of $28,4l6; that the surplus sales tax account is generating approx. 3% interest and with an annual repayment of $28,416 and a principal of $168,572.54, the debt would be retired at 3% interest in 6.63 years. Mr. Tingum reported he had talked to Lynn Endorf of the Dorsey firm, and his recommendation is to negotiate with First Bank and try to get present loan down. Mr. Shores suggested to Mr. Tingum that he approach First Bank and make inquiry re. tax exempt financing.
Moved by McCabe and Shores to approve, and authorize payment of the balance of the unpaid mortgage in the amount of $168,572.54, and to release the Grand Forks Development Foundation from its management responsibilities for the building, with said funds to be paid from

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the surplus sales tax account and repaid in annual payments of $28,416.00. Motion carried.

9. Request by PSAP director for reimbursement of relocation
expenses.
Dennis Koback, PSAP director, stated that when he was offered position he asked Mayor Polovitz if there would be reimbursement of relocation expenses (amounting to $4,575.99), and Mayor Polovitz stated he would look into it; that this has been done before for Mr. O'Leary and for Chief Aulich), and that he was asking for relief of cost to move to area. The committee stated that relocation expenses are usually negotiated upfront. Mr. Tingum stated this is new position and no funds available for this type of expense, if approved, would have to come from General Fund Misc. Contingencies funds. Mr. Shores stated he would like to confer with Mayor before making recommendation. Held until Monday, November 1 at 7:15 p.m.

10. Job description for personnel assistant.
Jay Graba, personnel officer, reported this is new position approved in the 1994 budget at Grade 11, however, position would be Grade 9 according to his evaluation; that individual will assist him in performing work, implementing safety program and preliminary work on ADA compliance; that education and experience are college degree and 1 year experience. He also noted that the position won't be filled until January 1.

Moved by McCabe and Shores to accept job description as presented. Motion carried.

11. Budget fund transfer request.
Mr. Tingum reviewed request to transfer $4,105.00 within civic auditorium budget to allow replacement of front doors before winter to save on heating and air-conditioning in summer. Moved by McCabe and Shores to approve transfer. Motion carried. (comm. only)

Meeting adjourned.

Alice Fontaine
City Clerk

Dated: 1/27/93.