Committee Minutes

MINUTES/FINANCE COMMITTEE
Tuesday, September 10, 1996 - 3:45 p.m.

Members present: Carpenter, Babinchak, Bakken, Hamerlik.

1. Matter of offer from Robert E. Mutcher, Sr. to purchase City lot at 1310 8th Avenue North.
Mr. Schmisek reported that Mr. Mutcher's previous offer had been rejected, that he has submitted a new offer and that Mr. Carsen has reviewed and re-valued the property. Mr. Carsen distributed copies of method of calculations, and stated that when property originally valued he used $2.25 sq.ft. or $14,600 and at that time outstanding specials were $500 and that's how they arrived at value of $14,100 as the asking price. He stated that since that time they demolished the house and special assessed cost of the demolition, and in re-calculating and figuring special assessments to September 1, the corrected asking price should be $12,782, and 80% of that would be $10,225.00; that Mr. Mutcher's offer is $10,000, and recommended using new calculations in determining value.

The committee discussed terms of the offer, which is $10,000 contingent upon rezoning the property (including his property which is West Half of Lot 19 and all of Lots 18 and 17) from B-1 to B-3 with occupancy or an unconditional user permit for 10 years. Mr. Carsen reported he had discussed matter of condi- tional use permit with Ray LeClerc of the Planning Office and that wouldn't be an option as a B-1 district does not allow for conditional use as a service garage.

The committee determined not to send any recommendation to the Planning and Zoning because rezoning could put other properties into non-compliance. It was also noted that any safety concerns re. location of building would be determined by inspection dept.

It was moved by Babinchak and Hamerlik to accept the offer of Mr. Mutcher to purchase the property for $10,000 plus unpaid special assessments pro-rated to closing date, with sale of the property contingent upon rezoning of the property from B-1 to B-3; and further that the City not consider the contingency for 10-year conditional use permit. Motion carried.

2. Applications for abatement of 1993 taxes by Marvin F. Poer & Company on behalf of Metropolitan Life Insurance Company on 11 properties in the Columbia Mall area.
Mr. Carsen reported that his office had received applications for abatements for 1993 on properties involving main Columbia Mall, J.C. Penney and 9 parcels surrounding the Mall owned by Metropolitan Life Ins. Co., that he had sent copies of his report to the owner and to Marvin Poer, and has since received communi- cation withdrawing their applications. No action required.

3. Application for 5-year property tax exemption from RDO Foods
Company for expansion project at 2500 Mill Road.

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Mr. Schmisek reported that a new application had been re- ceived with a higher project value (application requests exemp- tion of 100% for the five-year period). It was noted that settlement of the litigation with RDO Foods Co. has been reached and Mr. Swanson has received signed documents.

The committee questioned the increase in the project value. Carl Johnson, Plant Mgr., RDO Foods Co., stated that increase in the project value because they added more building space but have not changed project as far as equipment or what increase production by, increased size of building.

There was some discussion re. start of project construction, and Mr. Swanson reported they can move dirt, do footings and founda- tion prior to public hearing.

Moved by Babinchak and Hamerlik to grant preliminary approval and to set the public hearing for Monday, October 21. Motion carried.

4. Matter of recommendation from Implementation Committee for
Police Study re. disciplinary action policy.
Mr. Swanson distributed copies of proposed ordinance incor- porating comments from committee at their last meeting, and reviewed with the committee. He stated that substantive changes are as follows: to allow reprimand to be issued by either de- partment head or mayor; that they have deleted language in each of the individual disciplinary acts re. appeal and created new section for appeal process and made timetable for appeal con- sistent; to allow department head to suspend for up to 3 days, and retained authority for mayor to issue suspension for up to 60 days. He stated that they have started using phrase "working day" and will include definition for "working day" and working day will be based on a Monday through Friday definition. He stated that if an employee is suspended by a department head and appealed to the mayor who overturned department head's decision, there is no appeal by the department head to the commission to reinstate that. He reported they made number of changes in hearing procedure to identify that it's department head that's involved, made several other recommendations re. changes in language, where it stated that "Hearsay evidence shall be per- mitted when relevant to the central issues,...", changed "shall" to "may"; otherwise most of the changes reflect that the depart- ment head is the decision maker. He stated that the biggest change is that department heads have two forms of discipline that they can exercise on their own: reprimand and suspension up to 3 days.

There was some discussion re. notification, which was changed from 14 days to 10 working days, committee questioned whether that was long enough, concern if employee on vacation.

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Dan Gordon, Human Resources, stated that redraft fulfills all requests from the Implementation Committee, and recommended the 10 working days as being reasonable length of time. He stated he has not seen problem with persons being on vacation. Mrs. Babinchak stated that most of the problem is on the notification of the discipline and not the appeal. Mr. Gordon stated he didn't see problem with that.

Mr. Swanson recommended to include effective date for the ordinance, committee set effective date of November 1, 1996.

Mr. Swanson also pointed out that under section re. Probation, that if an employee is placed on probation, that in itself gives an appeal right.

Mrs. Babinchak questioned whether there was any way to do disciplinary board rather than Civil Service Board; Mr. Swanson stated that would be a re-write of the Civil Service Code. He stated that the Civil Service Code implemented in the 1930's (1932 or 1934) and was initiated and approved by public vote,and under North Dakota law if were going so far as to eliminate Civil Service Commission, it would require public vote with 3/4ths majority. Mr. Schmisek stated that the reason for vote was that this was adopted to protect citizens against nepotism and against the spoils system. Mr. Carpenter stated that it was State Statues that require the 3/4ths vote. Mr. Swanson stated he could get that information, but that there are some modifications they could do within the Code without taking it that far, would take broader scope of study. Mrs. Babinchak asked if they could modify their authority; Mr. Swanson stated he thought they could do some of those things: that Commission has three categories or areas: 1) hiring/testing (could speed up process if allowed administration to do that); 2) discipline and 3) grievances. He stated that scope of that is larger than what have here, and if that's direction the committee would like to go, his office would like to have time to study that so didn't find themselves in situation where the question of public vote did come up. He stated there was nothing in proposed ordinance that alters the Commission's role.

The committee also suggested not taking action at this time to give department heads, employees a chance to review. Mr. Gordon stated his office will see that copies are sent out. Held in committee for 2 weeks.

5. Request for reconsideration of matter of allocation of public funds for establishment and operation of Youth Commission.
Mr. Schmisek reported that Mr. Rolczynski had called and asked that this be placed on the agenda for reconsideration, that action to receive and file not a proper response to his request. He reported that he had his secretary call Mr. Rolczynski, that

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he will not be attending and that he wants committee to direct Mr. Swanson to answer the request made in the letter, that he deserved something in writing.

Chairman Carpenter asked if there was a motion for reconsider- ation; there was no motion; and no action by the committee.

Mr. Swanson stated that the council has the authority, that it is merely discretionary matter, falls within general category of public health, safety and welfare, really no different than Mayor's Committee on Employment of Handicapped, Bikeway Committee, they are all issues of general health, safety and welfare.

6. Matter of agreement with Springsted, Inc. for continuing dis- closure and/or arbitrage and rebate monitoring. Mr. Schmisek distributed copies of the agreement and reviewed with the committee. He stated that the SEC has issued some regulations re. continuing disclosure that is required when we make some bond sales, Springsted has given us a copy of an agreement if we wish to contract with them to perform the services that are required for this. He stated that they also suggested that they would perform arbitrage rebate monitoring for us, however, we are presently doing that in our office and working with Charles Bailey out of Fargo, and they have been doing an excellent job for us. He reported that he had forwarded a copy to Mr. Swanson for review. He stated that basically what's required is that we have to give information every year when we issue debt on material matters, ie., principal and interest payments, delinquencies, non-payment related defaults, unscheduled draws on the debt service reserves reflecting financial difficulties, modification of rights of bond holder, any bond calls, defeasances, rating changes, etc. He reported that in years that we issue debt, that's not a problem because have to include that in our offering statements and in monitoring and making sure that it occurs; there is $250 retainer fee and $200 fee per year covered by the addendum, that there are four bond issues at this time that would be covered by that, and the request is that if committee would wish to do agreement with them, he recommended that they authorize proper City officials to sign.

Mr. Swanson reported that there are three items in the agreement that he has concerns with: 1) continuing term that can be canceled by either party with 30 days notice, 2) indemnification, they are having us hold them harmless for any errors they may suffer and limiting our damages if they misfile or incorrectly file, no cause for action against them; and 3) agreement to be governed under the laws of State of Minnesota, rather than North Dakota.


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There was some discussion re. fees which is $200 per issue, and $1300 per type of debt, which kicks in in a year when City does not issue debt. Mr. Schmisek stated they would compile report listing all of our debt (similar to offering statement) and would address each of the 11 material or significant events that are involved and confirm if anything had occurred; he stated he wouldn't envision special report. There was some discussion re. this report and CAFR, that City doesn't file with place est. by SEC, that there's form for that. He stated that if this is something committee doesn't want to do, the finance department will be required to do it and not overly concerned if we are going to be responsible for this, because 95% of the time will be doing with the offering statement and make sure that the eleven items are commented on. Committee stated that for year not issuing any debt, $1300 seems expensive because City compiling most of the information.

Mr. Schmisek reported that he could address all of the concerns with Mr. Dornfeld on Monday, as he will be here for the bond sale. Held until special meeting on Monday, September 16, at 7:00 p.m.

Meeting adjourned at 4:45 p.m.

Alice Fontaine
City Clerk

Dated: 9/11/96.