Committee Minutes

MINUTES/FINANCE COMMITTEE
Tuesday, March 29, 1994 - 3:30 p.m.

Members present: Kulas, Johnson, McCabe, Shores.

1. Public hearing regarding request by TCI North Dakota, Inc.
for renewal of its cable television franchise.
Chairman Kulas opened the meeting and called for the public hearing.

Henry Howe stated his complaint is how the cable franchisee collecting accounts or billing accounts if more than a short period of time late in the payment, they had fairly arbitrary $3.00 service charge for the late payment; if more than 2 weeks they cut service off, effect of that is they had $3.00 on $20.00 bill, paying interest charge to 400% or something; that if late on payment cable company has someone contact customer, and adds on $15.00 charge for accepting payment and not cutting off service, add onto cost of having cable t.v.

Gerald Hovet, local manager, and Mr. Schwan, were present. and explained procedures; that $3.00 is late payment charge, don't disconnect until 45 days past due. He stated that they bill in advance, if come out to your house, and collect payment before disconnect, also charge $15.00 to cover truck roll.

Mr. Schwan stated they make every attempt, customer receives no less than 3 bills, to contact that customer prior to non-paid disconnects and CSR's calling just to remind; go out of their way to make aware before shutting off their service. Mr. Schwan stated that if less than $5.00 won't disconnect; that's not hidden, when get new customer give them copy of service policy, etc. and make mailing once every year to all customers as required by law. Mr. Howe stated $3.00 service charge on $20.00 late bill is high charge, service charges can compound. He noted that NSP late charge 1% of late bill, if Cable Co. used same rate would charge 21 cents rather than $3.00; high tariff on publicly regulated service.

John Schmisek, city auditor, advised committee that water department charges $5.00 late charge, and $20.00 service charge to get water turned on after shut-off; and if they have to send person out, collect the service charge.

Howard Swanson, city attorney, stated he would like TCI North Dakota, Inc. to address items listed in the public hearing notice to determine whether current franchise should be renewed.

Mr. Schwan stated he didn't put together formal presentation; that they have made the offer to Grand Forks of same franchise they have in East Grand Forks because it is the most difficult franchise they have to comply with, about as all-encompassing franchise as they have seen and if have to do those things for that side of the river, no more difficult to do on this side.
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Mr. Swanson asked what they are proposing to meet community needs; that under the Cable TV Act of 1984, this body needs to determine an assessment of community needs in considering whether franchise be renewed or not; and is asking that they establish for the record what present cable facilities are and services and what you are proposing in the term of the additional franchise.

Mr. Schwan stated they have committed in East Grand Forks to do system rebuild within two years of the granting of franchise will start construction of the new system and complete within two years of start date; system will be capable of delivering 60 channels, band width - basically what doing in East Grand Forks and what proposing doing here, is give system capable of 60 channels and a whole lot more. He reported they are getting ready to do rebuild in East Grand Forks, fiber optic, and proposing to do same thing in Grand Forks under different time frame, start one year and finish the following year because of weather, have to have two summers to do. He stated that subscribership is little over 16,000 in Grand Forks.

Mr. Swanson stated he had read in Denver paper that TCI contemplating division of present corporate status in the four regional companies, and if that should occur, effect on TCI in Grand Forks.

Mr. Schwan stated he thinks none; they are talking about taking total company and splitting into 4 divisions, with one responsible for foreign investments, one responsible for programming investments, one responsible for domestic cable operations and one responsible for R and D. He stated that Company basically split up that way now but all under TCI name or the Liberty name and operating under domestic cable operations; that there might be 3 or 4 separate entities being taken public; operations wouldn't be altered.

Mr. Schwan stated re. other items on list, that they have met all past franchise requirements, never been notified otherwise and quality of existing cable service continues to improve; that Mr. Hovet is running 1% or less on service or trouble calls, which is twice as good as national standard; have demonstrated ability in the past and shown probable ability in the future to meet present and future cable needs.

Mr. Swanson questioned if any difficulty in meeting expanding city limits growth to south and west.

Mr. Hovet stated they can meet meets; that it's not a problem but sometimes difficult to extend feeder line when area developed with lots of land in between; and stated they would have to bring in trunk line if go farther south, that they now get notices from Planning and Zoning of pending plats.
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Mr. Swanson questioned if any problems with Channel 3, any technical or subscribed problems?

Mr. Hovet stated no problems they are aware of, UND takes care of entirely.

Mr. Swanson stated he has no further questions, and committee would receive comments by the public and TCI, and continue public hearing to date uncertain, and that negotiations for franchise continuation are on-going and not going to be concluded in the foreseeable future.

Mr. Shores stated that in the past he received number of complaints, but getting better; that one complaint was treatment customers would get - customer always wrong, that they have made attempt to clean up, and there is a difference in attitude; that last calls were one year to 18 months ago; and suggested that they should place little more emphasis in taking care of community and customers.

Mr. Schwan stated they were aware of that and have made serious attempt to rectify that; now have training course for all people in the office as well as field; working toward better service.

Moved by Shores/Johnson to continue public hearing to a date uncertain. Motion carried.

2. Applications for abatement of taxes:
a) Florence Charon, 708 28th Avenue South
Mel Carsen, city assessor, reported this applicant is a senior citizen who qualifies for senior citizen's tax credit and failed to apply for at the proper time, would mean refund of $500; and would recommend approval. Moved by McCabe and Johnson to approve application as submitted. Motion carried.

b) Henry Wirtz, 407 North 8th Street
Mr. Carsen reported applicant is a senior citizen who qualifies for tax credit for 1993, $63.00 difference in tax; and would recommend approval. Moved by McCabe and Shores that the application be approved as submitted. Motion carried.

c) Isabel A. Sten, 191 Parkview Circle.
Mr. Carsen reported applicant is a disabled person and because of income qualifies for a discount, $782 for 1992 and $591 for 1993; and would recommend approval. Moved by McCabe and Shores that the application be approved as submitted. Motion carried.

d) Larry D. and Judith M. Corcoran, 1009 Oak Street
Mr. Carsen reported this is single family house built in 1928, with additions in 1946 and 1984; that the property has
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garage which was built in 1951 with an addition in 1987, and they have set market value on land of $14,500 and improvements $48,500, for a total value of $63,000. He reported that Mr. Corcoran had an appraisal of house for refinancing purposes done by Betty Torgerson who appraised property at $49,600. He reported that since that appraisal his office made a new appraisal of $60,800, and recommended a reduction of market value from $63,000 to $60,800.

Mr. Corcoran stated he received increase in valuation of property in 1984, in 1985, in 1987 and 1988, and in 1989 and 90; that taxes have doubled; house is 60+ years old. Mr. Carsen stated reasons for increase is inflationary factor which varies in neighborhoods, along with other things done to house to generate increases. Mr. Carsen stated Mr. Corcoran paid $45,500 plus specials for the property in 1981, since then has built additions to back of house, new furnace, new windows, siding, considerable remodeling done to the house. Mr. Corcoran stated this is a two-bedroom house, with single car garage, 60 years old, has maintained his property; and stated that if the appraiser's value is low, the assessor's value is high.

After further discussion it was moved by Shores and Johnson to concur with the city assessor's valuation of $60,800.00. Motion carried.

3. Application by Richard Nelson for five-year property tax
exemption for business at 1501 Dyke Avenue.
Richard Nelson, Valley Glass Company, stated he is putting up one and possibly two buildings; has been operating out of his residence; and is opening glass shop and will repair, manufacture store fronts, etc. Mr. Carsen stated this is a primary sector business (adding value to raw materials). The committee noted that in the past applications have been granted on a graduated scale (100% first year, 80% second year, etc.) for five years.

Moved by McCabe and Shores to give preliminary approval and to set public hearing for Monday, May 2, 1994 at 7:30 p.m. Motion carried.

Mr. Nelson was advised that it was his responsibility to publish the notice in the official newspaper and to send notice to any known competitors.

4. Matter of financing new building for Convention and Visitors'
Bureau.
Dave Kjolhede of Convention and Visitors Bureau and Mr. Laffen, of Johnson and Laffen Architects, were present. Mr. Schmisek reported that the State law allows municipalities to levy 1% tax on hotels/motels to be used exclusively for construction purposes and they are asking for go-ahead to
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continue to pursue building on this property; City looking to purchase R/W from the State (cannot be sold to private entity), and land lease agreement drawn to recover those funds; 1% would raise enough funds for $625,000 bond sale and pay that debt off in 5 1/2 years; $20,500 cost to purchase property; title will stay with the City, and they will negotiate flexible lease.

Mr. Kjolhede stated building to be located north of Holiday Inn,
between North 42nd and N. 43rd Streets, will serve as information center of Grand Forks and East Grand Forks, and offices should be housed there to avoid duplication of staffing, etc. - office and information center complex, with 4500 sq.ft., need parking for 30-35 vehicles; site big enough, retained architectural firm, at this point still a concept.

Mr. Schmisek questioned whether amend the existing ordinance or establish new ordinance to establish additional 1%, there are two separate funds; that there are some timing questions - if ordinance introduced at this time, with second reading April 18, and once ordinance final a 60-day referral period ending June 17, July 1 effective date to start collection. He stated they are looking at bidding date in August for the project, and if bid award in August, looking at September or October bond sale date, will go immediately after that, when have bid price.

Mr. Swanson advised that if approve this item would be amending Section 21-2101 to establish an additional tax; under Code there are 2 funds and uses segregated - one for operations and one for capital improvements bonds.

Mr. Kjolhede stated that the Hotel/Motel Board in support of proposal, with room tax sunset clause upon payment of the bonds. He stated they are paying rent to the Chamber of Commerce, and if building paid by bonds, that monies allocated for rent would pay for part of expenses; that they can handle operation of facility. He also reported that the State of North Dakota has indicated they will be interested in joining in cost-sharing of personnel for information center; and they will allow better service to visitors to the community; would be in a visible location.

Moved by Shores and McCabe to introduce ordinance to amend Section 21-2101 of the Grand Forks City Code to allow for additional levy of taxes for capital improvements for a convention and visitors center with an effective date of July 1. Motion carried.

5. Matter of ratification of change in by-laws of Greater Grand
Forks Convention & Visitors Bureau.
Mr. Swanson reported that by-laws changed sometime ago, primarily the selection of members, number of members changed from 14 to 13; present board currently 7 members appointed by
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Hotel/Motel Assn., 4 members appointed by mayor of Grand Forks and 2 members by East Grand Forks mayor; under our Code that established the convention and visitors bureau, any by-law change has to be approved by the City.

Mr. Kjolhede stated their intent was that immediate past president would remain on Board for one year as non-voting member, to maintain continuity of Board.

The committee reviewed by-laws and suggested deletion of words "..at least...", with no other changes.

Mr. Swanson noted that there were additional recommendations by the city auditor's office to 1) property reflect name of Greater Grand Forks Convention and Visitors Bureau, and 2) audit requirement that audit be filed before March 1.

Moved by McCabe and Johnson to introduce ordinance amending Section 21-2101, sub-part 2, and Section 21-2107 and introduce ordinances for first reading. Motion carried.

6. Matter of amendment to Code re. Motel-Hotel tax.
This item included under item 4.

7. Audit report for Greater Grand Forks Convention & Visitors
Bureau, Inc.
The committee reviewed report, and there were no comments from the committee. Moved by Johnson and Shores to recommend approval of the report by Brady Martz and payment of the bill. Motion carried.

8. Bids for City-owned property at 318 North 4th Street.
Mr. Schmisek reported they had received 3 bids on property at 381 North 4th Street, 25 ft. lot, on March 22, one of the bids was not opened as bid came by FAX; specifications required bids to be in sealed envelope with cashier's check in the amount of 10% of the bid, with right to increase bid orally after bids read. The following bids had been opened: Jon Omlid, $1,000 and Linda Ohlsen, $1,200; Mr. Omlid, who owns adjacent property, increased his bid to $1300; Mrs. Ohlsen not present. He reported that the City had set value of $3300 on the property. Henry Howe stated he was here on behalf of Roland Reimers, bidder, who didn't understand he had to send in check; was interested in acquiring but bid didn't get opened. Moved by McCabe and Johnson to reject all bids. Motion carried.

9. Temporary and overtime statement for February, 1994.
The committee reviewed statement. Moved by Shores and Johnson to approve. Motion carried. (committee only)

10. Matter of budget amendment, city attorney's budget.
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A request for budget amendment from Attorney's Office in the amount of $3,500.00 from 1993 carry-over funds, was reviewed by the committee. Moved by Johnson and McCabe that the request be approved, and an ordinance to amend the budget be introduced for first reading. Motion carried.

Meeting adjourned.
Alice Fontaine
City Clerk
Dated: 3/30/94.