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PROCEEDINGS OF THE CITY COUNCIL
OF THE CITY OF GRAND FORKS, NORTH DAKOTA
October 4, 2010

The city council of the city of Grand Forks, North Dakota met in the council chambers in City Hall on Monday, October 4, 2010 at the hour of 5:30 o’clock p.m. with Mayor Brown presiding. Present at roll call were Council Members Bjerke, Glassheim, Gershman, Christensen, Sande, Kreun - 6; absent: Council Member Grandstrand - 1.

The department heads led the city council in the pledge of allegiance to the flag.

Mayor Brown announced that anyone wishing to speak to any item may do so by being recognized prior to a vote being taken on the matter, and that the meeting is being televised.

Mayor Brown commented on various events during the past week and upcoming events:
October 3 - 9, 2010 is Fire Prevention Week 2010 in Grand Forks, and proclamation was read and encouraged urging all people in Grand Forks to protect their homes and families by heeding the life saving messages of Fire Prevention Week 2010 and to support many activities and efforts of Grand Forks Fire and Emergency Services.
Tentative planning to begin leaf pickup next week, announcements will be made by Public Information and public works will make two full passes through the city.
Pleased to host a number of elected and business officials from areas of Stanley, Tioga, and Williston to reciprocate for our East/West get to know you sessions; and thanks to the Chamber and Center for Innovation for setting up these meetings and look forward to ongoing discussion re. state-wide issues and solutions in the upcoming legislative session.
Please to be hosting the high school band from our Norwegian sister city, Sarphsborg, who will be touring local schools and a public performance tomorrow night at Red River High School.
Announcement of Grand Forks' recognition as One of the 100 Best Communities for Young People.
This is UND Homecoming Week and encourage everyone to participate in events, esp. football game at the Alerus on Saturday.

HOLD PUBLIC HEARING AND APPROVE APPLICATION
BY J.R. SIMPLOT COMPANY FOR TEN-YEAR PROPERTY
TAX EXEMPTION

The staff report from the city assessor relating to public hearing on a property tax exemption pursuant to NDCC Chapter 40-57.1 (Expanding Business) by J.R. Simplot Company, 3630 Gateway Drive, with recommendation to hold public hearing and may grant up to a 10-year property tax exemption for the proposed anaerobic digester.

The deputy city auditor reported that pursuant to the provisions of Section 40-57.1 of the North Dakota Century Code, notice had been given to the public that the city council would meet this evening to consider the application of J.R. Simplot Company, 3930 Gateway Drive, for a ten-year declining property tax exemption of the property taxes on Lot 1, Block 1, Auditor's Subdivision No. 28 to the city of Grand Forks (as shown on Exhibit A and to be platted as Lot 5, Block 1, Simplot First Resubdivision), which the applicant will use in the operation of their business and further that no protests or grievances had been filed with her office.

Mayor Brown opened the public hearing, there were no comments relating to the matter, and the public hearing was closed.

Keith Lund, Grand Forks Region Economic Development Corporation, spoke in support of the J.R. Simplot's property tax exemption request, that J.R. Simplot is very important company in our region and have direct employment of 388 individuals at their plant in Grand Forks with payroll of over $21 million, however, the company's business activities provide significant benefit beyond its employment, they are significant users of city's water and wastewater systems, and support many industries in the region, including transportation, agriculture. He stated that the Grand Forks Economic Development Corporation Board of Directors supports the project and encourages the Grand Forks city council to approve a property tax exemption as permitted by State law and as deemed appropriate by the city council. He introduced several members of Simplot Company who were present.

Mr. Paul Saras stated that this has been a focal point for them and an important plant in the mix of plants that they have, 7 across the U.S. and one in Canada; they also have their STS division, fertilizer divisions that live and work here, and communities like Grand Forks' are very important to the Simplot Company, and thanked council for their consideration of their proposal.

Council Member Kreun stated we appreciate the business that Simplot has given us over the years and appreciate the investment that you make in our community and very well appreciated by our council and our citizens; and moved to support a 10-year property tax exemption for the Simplot Company, 100% exemption provided for the first 5 years and a declining exemption during the second 5 years with 100% for year 6, 80% for year 7, 60% for year 8, 40% for year 9 and 20% for year 10. Council Member Sande seconded the motion.

Council Member Glassheim stated his original preference for the exemption would have been 80% exemption for the whole 10 years because the city of Grand Forks needs to expand its property tax base as quickly as it can but understands your investment is more upfront and won't be reaping benefits from it for some time and backed away from that but would like in the second 5 years that rather than starting the 6th year with 100% and declining to 20%, to give you the same amount of dollars of exemption but make it read 80%, 70%, 60% 50% and 40% for the second 5 years and accelerating for some extent what the City is collecting a little sooner and would make that amendment.

Council Member Gershman asked if they are planning any beautification or landscaping at the plant as they have worked for many years for beautification along Gateway, and that with national presence it would be a good thing to consider it, and would appreciate it.

After further discussion relative to the current plant and additional plans for the future, Council Member Glassheim restated his motion, which was seconded by Council Member Christensen.

Upon call for the question on the amendment and upon voice vote, the motion carried 5 votes affirmative, Council Member Bjerke voting against the motion.

Upon call for the original motion as amended and upon voice vote the motion carried 5 votes affirmative, Council Member Bjerke voting against the motion.

ADOPT RESOLUTION VACATING UTILITY EASEMENT
IN LOT 8, BLOCK 6, VALLEY PARK 2ND ADDITION
The deputy city auditor reported that pursuant to instructions by the city council after having received a petition to vacate a 10-foot wide utility easement, being the east 10 feet of Lot 8, Block 6, valley Park 2nd Addition, except the north 10 feet thereof, the required legal notice had been published calling for a public hearing to be held this evening, and further that no protests or grievances had been filed with the auditor's office.

Mayor Brown opened the public hearing, there were no comments and the public hearing was closed.

It was moved by Council Member Kreun and seconded by Council Member Christensen that we find and determine an insufficiency of protest to the proposed vacation, and introduce and adopt the following resolution, which was presented and read: Document No. 9299 - Resolution. Carried 6 votes affirmative.

ADOPT RESOLUTION VACATING LOTS, BLOCKS,
RIGHTS OF WAY AND EASEMENTS IN HOMESTEAD
GROVE SECOND ADDITION

The deputy city auditor reported that pursuant to instructions by the city council after having received a petition to vacate Homestead Grove Second Addition, including all lots, blocks, rights of way and easements on file with the Grand Forks County Recorder as Document Number 653665, the required legal notice had been published calling for a public hearing to be held this evening, and further that no protests or grievances had been filed with the auditor's office.

Mayor Brown opened the public hearing, there were no comments and the public hearing was closed.

It was moved by Council Member Gershman and seconded by Council Member Christensen that we find and determine an insufficiency of protest to the proposed vacation, and introduce and adopt the following resolution which was presented and read: Document No. 9300 - Resolution. Carried 6 votes affirmative.

MATTER OF CDBG ADMINISTRATION FUNDING
REQUEST

The staff report from the urban development department relating to CDBG administration funding request, with recommendation to authorize $75,000 for studies, including $45,000 for housing needs assessment, hold request from Shelter for Homeless pending more information.

Council Member Bjerke made comments opposing the recommendation and questioned why the City is involved in this as the Social Service programs are run through the County and doesn't believe that government should be in the housing business and will be voting no on both of those.

Mr. Hoover stated that the committee did recommend $45,000 for the Housing Authority study and the Mission study would be held as a placeholder pending further information and no commitment to that study.

Council Member Christensen stated re. the Housing Authority funding the study or not, is something that this money qualifies for the study being done because we are funding the needs of the community for low to moderate income and the study will give us all of the housing needs in the community and will include low to moderate income. Information will be disseminated to people that build houses in this community, including realtors, builders, etc. Council Member Christensen moved approval to the recommendation, and Council Member Kreun seconded the motion.

Council Member Glassheim stated that this study serves the private sector and is a government study that will help direct the private sector's resources in best way possible and to meet the needs of the community and make the needs known to the private sector. There may be public building that come from it as well as private activity.

Upon call for the question and upon voice vote, the motion carried 5 votes affirmative, Council Member Bjerke voted against the motion.

APPROVE REDEVELOPMENT OF CITY-OWNED
LOT AT 1423 WALNUT STREET

The staff report from the director of urban development relating to redevelopment of city-owned lot at 1423 Walnut Street, with recommendation to approve review committee's recommendation and convey lot to Blair and Charlene Nelson, proposal for construction of 1 1/2 story house plus detached garage valued at $225,000 and lot bid of $27,500.

It was moved by Council Member Gershman and seconded by Council Member Sande that this recommendation be approved. Carried 6 votes affirmative.

ADOPT RESOLUTION CALLING FOR BIDS AND SET
SALE DATE FOR $4,210,000 REFUNDING IMPROVEMENT
BONDS, SERIES 2010-B (DIKE IMPROVEMENT)

The staff report from the finance department relating to authorizing the call for bids and set sale date for $4,210,000 Refunding Improvement Bonds, Series 2010-B (Dike Improvements), and adopt resolution relating to $4,210,000 refunding Improvement Bonds, Series 2010-B, and calling for the public sale thereof on November 1, 2010.

Brenda Krueger, Springsted, Incorporated, city's financial advisor, spoke to the two bond issues, that the Refunding Improvement Bonds, Series 2010-B where financing dike improvements and Refunding Improvement Bonds, Series 2010-C where financing 2010 paving, street lighting, storm sewer type of projects, each of these issues will be paid over a term of 20 years and source of repayment is going to be special assessments against benefited property. She stated on Series 2010-B (Dike Improvements) have an amount of $4,210,000 and those assessments are currently in process and a pre-payment period is currently in process through the month of October, and as those prepayments come in will be able to reduce the principal amount of this issue and on November 1 will have issued a smaller par amount of the bonds and expects it will be less than $4 million. As part of the bond issue in process will go to Moody's Investors Service and apply for a credit rating; that when she was here earlier this year your credit rating was a Aa2 and since that time Moody's has recalibrated all of its municipal bond ratings on par with the corporate bond ratings and Grand Forks now has a rating one notch higher of the Aa2, and will be going to the market with a better rating and expect great reception to the bond issues.

Ms. Krueger gave a brief outline of the background of the dike issue relating to cost and percentages over the past 10 years.

There was some discussion relative to including payment for the Riverside pool and the dog park along with paving street in front of the dog park in the bond issue, $1,175 million; that the cost of the Riverside pool was widely advertised and public knew what they were voting for and voted 70% in favor of the pool.

Council Member Kreun introduced the following resolution and moved its adoption: Document No. 9301 - Resolution.

The motion for the adoption of the foregoing resolution was duly seconded by Council Member Gershman and upon vote being taken thereon, the following voted in favor: Council Members Glassheim, Gershman, Christensen, Sande, Kreun - 5; and the following voted against the same: Council Member Bjerke - 1; whereupon the resolution was declared duly passed and adopted and was signed by the Mayor and his signature attested by the City Auditor.

ADOPT RESOLUTION CALLING FOR BIDS AND SET
SALE DATE FOR $4,805,000 REFUNDING IMPROVEMENT
BONDS, SERIES 2010-C

The staff report from the finance department relating to authorizing the call for bids and set sale date for $4,805,000 Refunding Improvement Bonds, Series 2010-C, and adopt resolution relating to $4,805,000 refunding Improvement Bonds, Series 2010-B, and calling for the public sale thereof on November 1, 2010.

Council Member Kreun introduced the following resolution and moved its adoption: Document No. 9302 - Resolution.

The motion for the adoption of the foregoing resolution was duly seconded by Council Member Gershman and upon vote being taken thereon, the following voted in favor: Council Members Bjerke, Glassheim, Gershman, Christensen, Sande, Kreun - 6; and the following voted against the same: none; whereupon the resolution was declared duly passed and adopted and was signed by the Mayor and his signature attested by the City Auditor.

REFER MATTER OF 2011 FEE SCHEDULE BACK TO
FINANCE/DEVELOPMENT COMMITTEE AND TO
SERVICE/SAFETY COMMITTEE FOR FURTHER
CONSIDERATION

The staff report from the finance department relating to resolution, 2011 fee schedule, with recommendation to approve fees by resolution.

Council Member Gershman reported that he had talked to city staff, that a few years ago they reassessed all of the fees, most adjusted from staff input re. actual costs and agreed that they would attach a CPI to it each year, but the recommended policy from the city council evaporated, and now have a fee structure that came in with fees very inconsistent and that he would recommend to council to send this back to staff to reestablish what the policy was of the CPI and be finished with it. He moved to send the resolution back to both committees working with staff to reestablish the policy. Council Member Christensen seconded the motion.

Council Member Glassheim stated that he partially disagreed, that many of the items stayed the same and didn't go up by inflation including building permits which are charged based on value, and that he reviewed the fee schedule and that most of the ones that were changed, were rounded off; there were several that are State determined and we have no choice on those and not sure it needs to go back to committee.

Upon call for the question and upon voice vote, the motion carried 6 votes affirmative.

APPROVE FLOOD INSURANCE AND REVIEW ALL
PUBLIC BUILDINGS AND ALERUS CENTER TO SEE
IF INSURANCE NECESSARY OR NOT

The matter of flood insurance on city-owned property, with recommendation that staff needs direction whether to continue flood insurance on the city-owned properties.

Council Member Bjerke stated he brought this up to study and determine which buildings should be insured - some rational thought put into this issue as to why we do or don't insure them, and was to be policy decision on how we spend approx. $175,000, to have a letter from the mayor and city council resolution sent to the regional head of FEMA and a copy sent to our Congressional delegation and hopefully sent forward to the head of FEMA, and why spend $400 million on the dike project and be forced to abide by rules that were in effect when we didn't have the dike, and would no longer be required to have flood insurance on the buildings for 25 years and to stop paying the excess flood insurance which is going to Lloyds of London on two of our buildings. He moved the following motion, to send this back to committee along with a letter from the mayor and a resolution from city council and staff study the issue and bring back from both committees recommendation as to which buildings should be insured or not. Council Member Gershman seconded the motion.

Howard Swanson, city attorney, stated he identified one rationale in some publications from FEMA as to why they have required the city to continue flood insurance, and that is under FEMA application for federal assistance they apply duplication of benefits policy, that if you are insured, they will not provide coverage for the same amount of your insurance, what they are effectively doing is saying that if you have insurance that insurance will pay the first x number of dollars of your loss, not the FEMA public aid. In the case of excess insurance FEMA has made a determination that they do not want to reinvest or pay a second time for repairs of damaged property below a certain level. They have forced you to transfer their risk to the insurance program away from the public assistance program.

Mr. Swanson stated that to FEMA it wouldn't matter whether you had the dike or not, they don't want to take any risk of any flood event that would cause a second damage to a building that they paid to rehab or to build new, they are trying to avoid situation where those same public dollars are being paid and instead transferred to an insured dollar.

He also stated there is a listing of buildings in which the agreements that were entered into between the City of Grand Forks and FEMA after the 1997 flood require us to carry a minimum amount of insurance on those buildings - including water treatment plant, Senior Citizens Center and civic auditorium. Council Member Glassheim stated we are in the process of getting the civic auditorium off which will save us $10,000 - and for those items that are required by FEMA and no going back to committee will change that. FEMA requires we have flood insurance for 25 years on buildings we received federal assistance for damage repair after 1997 flood. Mr. Swanson stated those are required coverages that we committed to when we accepted the funds. Council Member Glassheim stated that we not send this back to committee as things are required by FEMA and that the motion was to requires the mayor to write and see if we could be released by FEMA as they are the only one that can release us from those requirements.

After further discussion and upon call for the question and upon voice vote, the motion failed by vote of 5 to 1, Council Member Bjerke voted for the motion and balance of members voted against the motion.

Council Member Bjerke moved to direct the city finance director to buy flood insurance for the Alerus Center and send the bill to the Alerus Center for reimbursement. The motion died for lack of a second.

Council Member Sande moved that we continue paying flood insurance and we review the Alerus Center and all the other buildings to determine whether flood insurance is necessary or not. Council Member Christensen seconded the motion. Carried 5 votes affirmative, Council Member Bjerke voted against the motion.

APPROVE SALE OF SURPLUS PROPERTY TO
DEVELOPMENT HOMES, INC.

The staff report from the finance department relating to sale of property described as Lot 3, Block 1, Perkins Sixth Resubdivision with no assigned address (tax delinquent property acquired from Grand Forks County) , with recommendation to declare surplus and consider the sale of Lot 3, Block 1, Perkins Sixth Resubdivision to Development Homes, Inc. according to Article 4 of the City Code, Sale of City Property.

It was moved by Council Member Gershman and seconded by Council Member Sande that this recommendation be approved. Carried 6 votes affirmative.

APPROVE CLOSING ACTIVITIES AND NEGOTIATIONS
FOR ACQUISITION OF PROPERTY NEAR LANDFILL

The staff report from the director of public works relating to matter of real estate property negotiations near the new solid waste landfill, with recommendation to close activities and negotiations for acquisition of property near landfill as of November 4, 2010 except for properties subject to a signed purchase agreement prior to November 4, 2010.

Mr. Swanson noted that the 30-day recommendation was from his office, and that a signed purchase agreement from the property owner be with the City on or before the expiration of the 30-day time period.

It was moved by Council Member Gershman and seconded by Council Member Glassheim that this recommendation be approved. Carried 6 votes affirmative.

APPROVE TEMPORARY ENCROACHMENT FOR
DRIVEWAY APPROACH AT 721 CHERRY STREET

The staff report from the engineering department relating to temporary encroachment for driveway approach onto Cherry Street, with recommendation to consider a five-year temporary encroachment to allow for the installation of a driveway approach at 721 Cherry Street for the purpose of short term loading and unloading.

It was moved by Council Member Gershman and seconded by Council Member Sande that this recommendation be approved. Carried 6 votes affirmative.

APPROVE SOLE SOURCE SPECIFICATIONS FOR
EMERGENCY PURCHASE OF TELEPHONE SYSTEM

The staff report from the police department relating to specifications and sole source emergency purchase of telephone system, with recommendation for approval of specifications and sole source emergency purchase of system for the police department at a cost of $34,430.00 from CD Communications

It was moved by Council Member Gershman and seconded by Council Member Sande that this recommendation be approved. Upon call for the question and upon voice vote, the motion carried 6 votes affirmative.

APPROVE TRANSIT ADVERTISING SERVICES FOR
PUBLIC TRANSPORTATION

The staff report from the director of public works and from Public Transportation Services relating to transit advertising services Proposal #2010-58, with recommendation to approve Trans Ad, Inc. proposal and firm as the most qualified transit advertising services proposal and firm.

It was moved by Council Member Gershman and seconded by Council Member Sande that this recommendation be approved. Upon call for the question and upon voice vote, the motion carried 6 votes affirmative.

APPROVE DIAL-A-RIDE/SENIOR RIDER REQUEST
FOR CHANGES TO CURRENT SERVICE LEVEL

The staff report from the director of public works and from Public Transportation Services relating to Dial-A-Ride(DAR)/Senior Rider request for Proposal (RFP), with recommendation as part of DAR/Senior Rider RFP approve the following proposed changes from the current service level: change the age of senior rider eligibility from age 55 to 62 years old for both the Senior Rider program and City Bus; and change times to call in for next day reservations for DAR/Senior Rider program to include start times from 6:00 a.m. to 6:30 a.m. Monday through Friday and from 6:00 a.m. to 8:00 a.m. on Saturday, and end times from 10:00 p.m. to 5:00 p.m. Monday through Saturday.

Council Member Bjerke stated that if they are going to change the age of ridership to 62 for Dial,-A-Ride in order to save money and where have to have qualifications in order to ride, should only allow those 62 or over to ride and not grandfather people in from 55 to 61 who fit into previous requirements.

It was moved by Council Member Kreun and seconded by Council Member Sande to approve the recommendation. Upon call for the question and upon voice vote, the motion carried 5 votes affirmative, Council Member Bjerke voted against the motion.

APPROVE LANDFILL GAS FEASIBILITY STUDY REPORT
The staff report from the Landfill Gas Feasibility Study Report and presentation, with recommendation to receive and file the Landfill Gas Feasibility Study Report.

It was moved by Council Member Gershman and seconded by Council Member Sande that this recommendation be approved. Carried 6 votes affirmative.

APPROVE BILL LISTING AND ESTIMATE SUMMARY

Vendor Payment Listing No. 10-19, dated September 29, 2010, totaling $1,227,799.73 and Estimate Summary dated September 30, 2010 in the amount of $1,283,173.90, were presented and read.

It was moved by Council Member Sande and seconded by Council Member Bjerke that these bills and estimates be allowed and that the city auditor be authorized to issue warrants in payment of the same. Upon roll call the following voted "aye": Council Members Bjerke, Glassheim, Gershman, Christensen, Sande, Kreun - 6; voting "nay": none. Mayor Brown declared the motion carried and the bills ordered paid.

APPROVE MINUTES SEPTEMBER 20, 2010

Typewritten copies of the minutes of the city council held on September 20, 2010 were presented and read. It was moved by Council Member Bjerke and seconded by Council Member Sande that the minutes be approved as read. Carried 6 votes affirmative.

COMMENTS BY MAYOR AND COUNCIL

1) Council Member Gershman asked that Urban Development review lights on top of buildings in the downtown area as some lights are on and some out.

ADJOURN

It was moved by Council Member Sande and seconded by Council Member Kreun that we adjourn. Carried 6 votes affirmative.

Respectfully submitted,



Candice Stjern
Deputy City Auditor

Approved:
________________________________
Michael R. Brown, Mayor