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MINUTES/FINANCE COMMITTEE
Monday, November 16, 1998 - 6:30 p.m.

Members present: Babinchak, Brooks, Carpenter.

1. Application for abatement of 1996 and 1997 taxes by Clifford
Dale Romuld, 1023 23rd Ave.S. (Lot 6, Blk. 11, Cox’s Addn.
Mel Carsen, city assessor, reported application is for abatement of 1996 and 1997 on a single-family resident, that his office had made error in calculation on the sq. footage of the house, that they corrected the 1999 and these abatements would correct 1996 and 1997 which is as far back as they can go, and recommended approval. Moved by Carpenter and Brooks that the application be approved as submitted; with adjustment in market value for 1996 of $12,000 and $13,400 for 1997. Motion carried.

2. Matter of additional compensation for Civil Service Com-
mission members.
Dan Gordon, Human Resources Dir., reported that it’s been a long time since the Civil Service Commission has had an increase from their $20/day, some meetings recently have lasted up to three days and that brought out the question of their compensation, and thinks they are looking for something reasonable, $40/day for regular meetings or for interviews or hearings if last entire day from $120-150/day; funding out of Human Resources Dept.

Babinchak stated that they have listing of committes with only about four that get paid, and asked what if increase this one and why shouldn’t other boards/committees be paid also, and suggested that instead of changing this one, should look at the whole structure of the committees and whether they should be paid or not. Mr. Gordon stated he was here to talk about the Civil Service Commission, which is governed by City Code, which if changed would require a Code amendment. He stated that for other boards it was their responsibility if they see inequities to bring that forward. Brooks stated that they need to deal with this issue and ask to review others as to what current policy is. Committee stated they were not in favor of paying other committees.

Moved by Carpenter and Brooks to implement amendment to City Code - Section 6-0204 where per diem shall not exceed $1,500.00 per year and be paid in such manner that any meeting which is four hours or less paid at Forty Dollars and any meeting that exceeds four hours be paid at Eighty Dollars. Motion carried; Babinchak voted against the motion.
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3. Matter of proposed Health Care System Revenue Bonds, Series
1999 (Altru Health System Obligated Group), and calling for
public hearing.
Mrs. Jerath, deputy city auditor, reported that Dwight Thompson called today and asked that this item be pulled, that they want to delay it and come back at later date.

4. Matter of continuing disclosure and/or arbitrage rebate re-
quirements to $5,185,000 Refunding Imp. Bonds, Series 1998A
Mrs. Jerath reported that this is this year’s refund improvement bonds and we already have an agreement and contract with Springstead that whenever we had any new bonds they will provide that service for additional amount per bond, and recommended updating of the contract.

Moved by Carpenter and Brooks that we authorize proper City officials to sign the agreement. Motion carried

Hamerlik reported present.

5. Matter of petition for replacement of alley paving between N.
3rd and 4th Sts. and between 1st and 2nd Aves.N.
Gary Christianson reported that at one of the Downtown Development Commission meeting it was brought to their attention that the alley in question is in fairly rough shape, the Herald uses it for access to their parking lot rather than the street, and also provides access to the temporary parking lot the City is installing on that block also, and recommendation was to pave that alley through special assessment process. He stated that the property owners in question on special assessment need to present a petition to public service, that petition has been signed by the Herald, and someone from the City would need to sign the petition for the properties that the City now owns and that seemed to be question of a financial nature as to whether or not that should happen. He stated from here the petition would be forwarded to public service. Ken Vein stated that before they go through time and effort of preparing plans and specs, and in case where protestible, ask for 50% of the property owners to petition for the project, that petition is not legally binding in any way, the only way they would get in on a legally binding petition would be if they were going to petition it out once it’s created; that it’s basically a formality to know that if go through the effort it won’t be protested out and would pursue the project by creating the
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special assessment district and preparing plans and specs, and that there would be a formal protest period after that. Carpenter asked if we were to do this if we could pay our portion of the assessment upfront and use part of the CDBG money. Mr. Vein and Mr. O’Leary stated they could use part of the set-aside monies for downtown in the matrix. Mr. Vein stated that on the west side have the Federal Building and the Herald and on east side of the alley have City of Grand Forks and the Herald. It was noted that the Federal Building would not pay any special assessments. Babinchak asked if there was any question of selling the temporary parking lot between the Herald property and the small park. Mr. O’Leary reported that the DDC hasn’t discussed that. Mr. Vein stated that even if the Federal Building doesn’t pay that they’ve been questioning/
requesting some of this for awhile, and they maybe willing to pay a portion of it even if not part of the requirement to pay, and could approach them to see if they would participate. It was noted that each of the parking lots has about 24 spaces.

Moved by Carpenter and Brooks that we authorize appropriate City officials to sign the petition for the replacement of paving of the alley. Motion carried.

6. Matter of review of cost matrix.
Brooks stated that he had asked that they review this at finance, that Chairman Glassheim of Urban Development had question of whether it could be reviewed there, and that he had prepared a listing of questions to give to Mr. Schmisek to review, that he could give committee a copy also and could give a presentation later; and that it’s good to get an update and review in more detail than just the list itself. Hamerlik asked if he had list of questions so they could summarize it in some way to find out whether there was more spent, less spent, deadline dates and find out where we are and if wish to suggest when reviewing and discussing that money be transferred, and unless have an in-depth review and know exact dollars spent or the applications pending, deadline dates, and recommend that. Brooks stated that deadline dates, dollar amounts, where can switch, when and what can be done with the funds generated from those, and need to look at. He stated if can get back in writing will help to keep track of those things, and perhaps put on next agenda. Hamerlik stated that he had suggested that they have two big financial discussions coming up, one is dike funding and the other is this review and each time, time doesn’t
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allow for the discussions they need and people who wish to comment, and suggested that those two items be on an agenda and only those two and no added items, either at next meeting or a special meeting of the finance committee after they get necessary information. It was stated that they need the dike funding to move forward. Brooks will forward his questions, etc. Hamerlik stated that having to do with the Business Assistance Program, it would be interesting to know the dollar requests as they cut back, if have to, would seem one way would be to lower the max. than cut everyone in half, and would like to see review of some of that information. Held in committee.

7. Matter of south downtown parking ramp (County).
Connie Triplett, County Commissioner, reported that when this project first was discussed it was conceived by both City staff and people from the County who were discussing it as a City-owned parking ramp where the City would own the land on the building, build the parking ramp and would be open to the public, and County would obviously pay the lion’s share of the assessments because they would have the most benefit from it because of proximity and would pay for it through parking assessments over time. She stated that after some months when Mr. Schmisek put together a proposed indication of what the assessments would be in a parking district on the southend of downtown, it was his opinion that there simply aren’t enough businesses in that end of downtown to justify or make it cost-effective for the small businesses to be assessed, the assessments would be too high if the same formula was used as is used in the corporate ramp area and the exiting downtown parking ramp; so Mr. Schmisek suggested to them that they should consider bonding directly and have it be a County building. She stated they have had some discussion about that and asked if the $2 million that the City has allocated still available and is the $900,000 that has been talked about from the sale of City surface lots in that area still available if the County were to do it directly. She stated that in discussing with City staff it appears to them that probably the $2 million from the CDBG would be available but probably the $900,000 would not be, and history here is that the $900,000 from the sale of surface lots would not be appropriate to transfer to the County because of the fact that those lots have been special assessed against small businesses in the area over time and therefore, that would not be an appropriate transfer of those dollars to the County. She stated that in having received that response from City staff
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that probably answers Mr. Schmisek’s earlier question of whether the County go ahead and bond for it directly, and that without the $900,000 it would be cost prohibitive, and they are probably are back to square one where they would prefer to see the City develop the parking ramp and City own it and City Parking Authority manage it, accepting the fact that the County would have to bear the lion’s share of the assessments. She stated they would suggest that there be some kind of equitable arrangement worked out by the Central Business District Auth. so that investments against businesses in that southend of downtown would not be prohibitively high but would be somewhat equitable with the rest of downtown, and what that would do in the immediate future is it would require the County to pay the vast majority of the parking assessments but as time passes this parking garage will stimulate some economic development in the southend of downtown, then as new businesses are assessed, the County’s assessment would be gradually decreased. She stated that the County would be supporting the prospect of economic development in that end of downtown, which is what they were trying to accomplish in the first place by making a larger ramp. She stated there is support from the County for doing this but doesn’t make sense for them to bond for it directly, given the fact that it would mean the loss of that $900,000, whereas if the City were to do it, the $900,000 would be available.

Mr. O’Leary reported that the $900,000 being discussed is an estimate, and the estimate came from assessor’s office and finance office and it involves the buyout of parking lots that are on the dike line, on the east side of 3rd Street and south of the tracks and will need to be purchased because of dike align-ment, that $900,000 is the high end of a range and Mr. Schmisek indicated somewhere between $700-900,000 and value comes from value of the land as well as cost of improvements for the lots themselves. He stated that what Mrs. Triplett suggested probably needs an explanation or an opinion from Mr. Swanson; that when you levy special assessments the assessments get to be fixed unless do tax increment financing and even then fixed, and doesn’t know that once put special assessment against a building that County share of that would change. Mr. Swanson stated that if talking special assessment doesn’t matter who owns the property, is a lien and encumbrance against the property.

Mrs. Triplett stated in answer to Babinchak’s questions of whether a down-sized ramp or full ramp, that for the County’s
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purposes the smaller version works best, the three-story ramp for their needs are in the immediate future; that at the Central Business District Auth. meeting two weeks ago it was suggested that approaching the City to ask about putting in pilings so that the possibility existed for increasing it a four or five-story in the future would be a reasonable idea, and that also supports the idea of the ramp as a potential economic develop-ment if the economic activity in that end of downtown increases over time, esp. after the surface lots are gone for the dike and parking is in shorter supply. She stated that if they were just looking at it as being a ramp for the County’s use with that one building, then thinks those pilings would not be necessary because the three-story ramp would suit their needs but if trying to accommodate the needs of that end of downtown, then the extra amount for the pilings makes sense. Babinchak stated that if it were down-sized the County would be assessed for the ramp as they would be the only one using it. It was noted that the down-sized ramp is 370 parking spaces, they have 360 full-time employees plus people coming so not going to sell an assessment to any business down there that it would be helping them because County occupied. Jim Kobetsky, Schoen & Associates, stated that if someone is going to develop a building in that area that would put 370 cars in that whole area it would fill up the streets and make a situation where no parking, but if put in parking ramp and consolidate all parking into parking ramp, freed up street area. It was asked by committee chairman for the Central Business District Authority whether the County wants to do a bond to take some of the assessments projected which were phenomenally high, 20-30% of building value, and some smaller businesses there (like Grand Forks Mission being able to make payment, that they don’t make it and everybody else has to assume that amount of the assessment because assessment dollar doesn’t go down but every-body’s share goes up. He stated they are trying to address these issues but are missing a lot of information and that they really can’t go forward and come up with an intelligent recom-mendation because at this point, they don’t know how they can fund it, need it with the County coming in, and other buildings would have no place to park and reach a stalemate in development in that district without some parking but need to get some consensus on financing, how the City and Country can work together to come up with this, thinks bonding upfront is the way to go, there will be assessments to maintain the ramp, talk on
committee about things to make this ramp more attractive, more
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useable, one thing is higher ceiling height, painting white, surveillance cameras, security cameras and once build this will run into half million of finish on it, and esp. if do full dressup model, and lot of issues and they’re trying to wrestle with it as a committee, and that he is here to try to get a feel for what direction that’s going but need to get financing issue resolved, City and County need to get together on this, lot of things that need to be solved at once to make this a good viable project.

Carpenter asked if the cost of the ramp had gone up signifi-cantly in the last few months; and it was noted that it has, construction costs, land acquisition costs that haven’t been factored in, designed at this stage to include a lot they don’t own and a building that still exists that’s being run and operated and probably in the neighborhood of $150,000 acq. cost to buy that property (law firm) and also some demolition, etc. Dan Mehls, Mortenson Co., stated that costs have gone up sub-stantially in the last couple months, did budget cost amounts from est. based on the actual bids for the corporate center and adjusted and modified to the sq. ft. and volume of this ramp and really only cost increase from what seen couple months ago was security allowance and power outlets, etc. that have been added to $145,000; and total project cost: 3 level ramp (379 stalls) including design cost and 5% contingencies, $4,196,000; a 3 level ramp with premium for the piles, $4,614,000; and 4 level ramp (510 stalls), $5,915,000. It was noted that they would need to consider that the land acquisition costs is not included, which is another $150,000 + $10,000 demolition. It was also noted this does not include the $250,000 for a connection with the County building (4 level ramp does include that); and it was noted that walkway would be a County cost. It was noted that there are just over 400 spaces in the corporate center with cost of $10,000 per space.

The chairman of the CBD Parking Auth. stated they have been trying to get some dialogue with the County and based on what they are seeing, can’t assess and have this be successful because it won’t work, and his thought was a County-wide assessment which raises everybody’s property taxes $20/or something is much more palatable, if County employees who are there and people coming there to do County business, etc., and they would also like to have another 100 parking stalls and
build a fourth floor, then have room for economic growth in the
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area of the other buildings have potential for places to park as well and that’s something they are looking at trying to be a long-range planning minded committee decision, but there are so many issues but need to come to something fairly soon, and probably need to have meeting between County Board, his com-mittee, finance committee, etc. and have some real honest dialogue and crunch numbers and sit down and come up with some projections rather than what-ifs they have to operate under. He stated the only thing they know is costs for the various ramps - 3 styles of ramps, but need to bring two bodies together.

Mrs. Triplett stated that in discussions between the County and City staff, the sale of those surface lots was always considered to be part of the deal but when it was suggested that the County could bond for directly and possibly the County own the ramp, then when she asked the question, is that still part of the deal, that the $900,000 then becomes a question and that’s where they’re at now, need to get clarification on those surface lots and whether that money from the sale of those surface lots can be part of this project. Carpenter stated that he thinks only part of the project if for the full 510 because it’s all the property owners who paid for those. Carpenter stated that the City’s max. for the project was the $2 million.

Doug Christensen raised some questions at to the cost of the project, if $6.1 million because if the $900,000 goes in and already allocated $2 million from CDBG and heard Mr. Mehls say $6,065,000 and pay $150,000 for the land and demolition, and still short $3 million. He stated we are the County and 68% of the people in this city are county residents and if the County were to bond for $3 million, that means 65% of every dime that’s spent to cover those bonds comes out of the general tax dollars the County raises so it’s coming out of the city of Grand Forks again. He stated that $2 million of that $3 million is coming back out of the taxpayers pockets in the city of Grand Forks. He stated that at some point have to say when’s enough enough, that you want to have $12,130/stall for 500 stalls and it’s gone up $2,130 in less than 10 months. He stated that ramp might be enough for us to get by as a city as we grow the downtown until we have the demand. The HEMP Center is only bringing 180 people downtown, and study EAPC did and mostly 147 people in there and if go with off-street parking you have enough parking, and at best short 50 stalls, and if look at map of building to be taken
down, there’s room across the street for more surface. Mrs.
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Triplett stated that Mr. Christensen is right, that until the dikes go in there’s plenty of surface parking but question is what’s going to happen when the dikes go in and all of those surface lots are gone, and that’s when crunch is going to come and that’s what planning for, not going to be crunch next year or following year, but when dikes come in and use up those spaces, there is going to be a crunch and much more difficult to solve the problem when people in place, etc. Mr. Christensen stated he disagreed, that they have the space available upon which to propose the construction ramp anyway and do not have to go and buy ground, only issue is when if ever you have to build your third ramp, and asked if we need three parking lots for a downtown that will have one-third the buildings that had before the flood; at some point can’t be putting these taxes on all the people in this city; that there are very few reasons to build ramp at this time and esp. not at $6.1 million.

Gary Christianson stated that the lot where corporate center ramp is being built will lose 60 some spots and where new County building another 60 or 70 lots, and in whole grand scheme of things, will lose between 480 and 680 parking spots downtown through construction projects and/or dike projects.

Jim Kobetsky stated there are many buildings that are being developed (former First National Bank building, 30,000 sq.ft., and a lot of other developers looking at buildings to develop, but won’t develop unless there is parking downtown, and if flaw with downtown it was parking, and have to have parking or it won’t work, and that if look at the amount of traffic that the County has, 700 visitors per day, 378 employees, tremendous amount of cars coming into one location and will really isolate the development of that are if don’t provide parking.

Brooks stated that Mr. Malm sent us a memo and asked us some questions that need to be answered, and committee needs some assistance or recommendations from staff , and need to refer to staff and send on to the council with a recommendation from the committee. Mr. Swanson stated that he has heard no legal questions and suggested they start with Mr. Schmisek. Refer to staff and get answers to questions.

Moved by Carpenter and Hamerlik to adjourn; adj. at 7:30 p.m.

Alice Fontaine, City Clerk