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Minutes of Grand Forks City Council/Committee of the Whole
Monday, September 8, 2008 - 5:30 p.m._________________ __

The City Council met as the Committee of the Whole on Monday, September 8, 2008 at 5:30 p.m. in the Council Chambers in City Hall with Mayor Brown presiding. Present at roll call were Council Members Bjerke, McNamara, Glassheim, Gershman, Christensen, Kreun - 6; absent: Council Member Bakken - 1.

Mayor Brown commented on various items during the past week and upcoming events:
Congratulations to Congressman Dorgan, Governor Hoeven, City of Grand Forks and Gerald Gruenwald on National Hydrogen Center of Technology ribbon cutting this week, big step forward for nation and energy independence and great step forward for Grand Forks.
There is a mock disaster drill planned for tomorrow morning at 9:00 a.m. to 11:00 a.m. at corner of DeMers and Washington and should not disrupt traffic but a major scene and wants everyone to be aware that this is a drill.
This is Potato Week, with French Fry Feed on Thursday night and parade on Saturday morning, and game on Saturday afternoon; thanks to all organizers and volunteers, and good luck to the Sioux football team.
Last week had two birthdays - Margaret Garr was 90 and Dick Day was 100.
Week-end events had Special Olympics and Bocce tournament was success and so was the Sharon Lambeth and Louise Everwein Walk and Bike Ride - great events because of all the support from volunteers and organizers.
Thanks to everyone who attended the Public Safety Training Center grand opening on Saturday, and thanks to police, fire and public health crews. This is tremendous facility with enormous capacity and great opportunities in the future. There is a 5-minute video tour on the City's website at wwwgrandforksgov.com
Good news on Ali's Boundless Playground, equipment ordered and a community build to put it in place the week of September 23-26, need nearly 200 volunteers in the community to make this happen.
Be sure to give a big destination city welcome to the ND Solid Waste and Recycling Convention Conference this week and to the ND State Parks & Recreation Convention this week, and congratulations to the Alerus Center and locals involved in helping achieve these goals.
We once again have the opportunity to host the World Jrs. Tournament in 2011-12 and there is a World Jr. rally at The Ralph at 12:00 next Tuesday and need to show site visit team that we want it back, that our community cares and reacts and players and fans will know that they are in the heart of hockey country, so please attend that next Tuesday.

2.1 Application for abatement for 2007 taxes by Saleh and Yasmin Faruque, 3209 Chestnut Street. ____________________
There were no comments.

2.2 Various Code changes to amend license and permit fees.
Howard Swanson, city attorney, reported that the finance department has given a listing
of fees with increases - some of the changes will require ordinance changes and they are preparing an ordinance for that, and others will be approved by resolution; fees will become effective January 1, 2009.

Council Member Gershman brought up the item re. grocery stores, that the health department has about 35 locations they license as grocery stores and are inspected at least once a year, about 25 are convenience stores, gas stations, etc. carry only milk, bread, pkgs. meats, and other dry goods, and deli's in the supermarkets that sell prepared food are inspected twice a year and have at least 3 visits, and 5,000 sq.ft. at $217 and over 5,000 sq.ft. which they all are is $325/year and that when most of those stores are 50,000 to 100,000 sq.ft. or more that sending an inspector in to do things with deli's, etc. not sure if covering our costs and put that on the floor for discussion.

Mike McMenamy, 1819 Cottonwood Street, (McMenamy's Tavern), reported re. raising fees for on/off sale beer, wine, liquor, that last time they checked Grand Forks was paying the highest fees in the state for renewal fees and is getting too high, doesn't want to see it go up. The city auditor reported there was a policy that established those fees sometime back and we have started to increase these fees based on inflation, did try to do a cost of service study based on time police involved in reviewing liquor dealerships, etc. and they do put in significant time - this year increase about 4.9%, did not increase fees last year. Other cities have different classes of licenses and difficult to compare but will look at that again, and as we go through the budget process over past few years, it has been the council's direction to continue to look at fees and permits based on an inflationary basis. Mike McMenamy stated a 4.9% increase on lesser amount as compared to $3616 annual fee is big increase for them.

Council Member Christensen stated in looking at listing of licenses and fees, questioned if shouldn't review this again - dance halls, sign hangers - and should try to correlate the fee we are charging and the number of inspections and try to recoup our costs plus; that this is a task for administration but get cost accounting as to what we are spending. The city auditor stated that several years ago they did a cost analysis and asked every department to inform us of the number of inspections, hours - probably time to do that again before next budget year.

Council Member Kreun asked if could look at the items brought up - groceries and alcoholic beverages - before next week but do analysis for the next budget cycle.

Council Member McNamara stated that shortly the Board of Public Health will bring a recommendation re. to smoking in the city and will recommend that the policy in the city will be to enforce no smoking in public places, preceding council took half measure a few years ago and allowed smoking in certain establishments and had businesses in this community lay out in excess of $25,000 additional dollars to maintain their business (if had to change your license from a food establishment that sold liquor to a liquor establishment) and hopes when that policy comes forth that the council will look at refunding that additional money to those business owners because we didn't take the full measure that should have taken, and $25-30,000 to a business is a large chunk of money and to redo that measure 24 to 36 mos. later, and hope would consider that when the Board of Health brings that forward.

2.3 Change Order 3 for Project No. 6199 - Bikepath on Columbia Road from Pinehurst Dr. to Deacons Garden Addn., and Project No. 6228, 2008 Bikepath Maintenance.__
Council Member Bjerke stated reason for change order was to seal up more cracks than
anticipated, that they bid on an existing bikepath and if that wasn't part of the bid process. Dean Rau, asst. city engineer, stated the project only accounted for a fraction of the actual cracks that were out there, and once work begin many more cracks that had to be sealed than were anticipated and put in the plans; contractor bids according to the plans - that bid approx. 800 ft. of cracks however when went to work there were approx. 4,000 ft. of cracks; bid based on bid proposal.

2.4 Bids for Project No. 6320 - Riverside Pool Restoration.
Council Member Bjerke stated he had tried to get funding out of pot of money #1 and
next meeting will attempt to take half the cost out of pot of money #2 (excess sales tax) and pot of money #3 (cash carryover) and that he is not in favor of raising taxes to build swimming pool. He stated that there is an option to provide this service without having to raise taxes.

Council Member Gershman stated that when they were debating whether they should do another study because they felt the consultants came in high at $1.8 million and now came in at $1.1 and $700,000 under consultant's figure, and now $150,000 less than that - and that we did a good job. He stated he would go with the 66% of the citizens who understood because of the information that was out there that this was going to cost money.

Council Member Kreun asked if the recommendation is to go with the contingencies and alternates. Mark Walker, asst. city engineer, stated based upon bids received they anticipate that the project cost will be approx. $952,000 including construction based bid and alternative options, engineering and 10% contingency line item, and are recommending award of those individual contracts as well as optional bid items. Our consultant is EAPC and their staff visited with low bidder and verified that they was comfortable with the bid (base bid for the general contractor came in considerably lower than the second bid and caused some concern), after visiting with them the contractor is confident with his bid and willing to do the job as specified for the bid price.

2.5 Bids for Project No. 6322 - PCCP Forcemain Inspection Preparation.
There were no comments.

2.6 Consideration of bids for Project No. 6198, 2008 Capital Improvement for the Grand Forks Water Treatment Plant.
Council Member Bjerke questioned if the winner of the bid is the same company that was
involved with the wastewater treatment plant, and if the work will be performed for the price and quality. Todd Feland stated they had two law suits with that contractor, and in this project not dealing with some of the issues in the prior two projects, this is more rehabilitation and in this project with the engineer that we have and with Advanced Engineering doesn't think it will be an issue, that Advanced Engineering will be in charge of the construction observation and comfortable working with John T. Jones in this case.

Council Member Christensen stated that the Supreme Court ruled in the Baukol lawsuit that dealt with the jail that in accepting bids can consider prior experience with a contractor, not required to take the lowest bid, that he will be watching this one very carefully to make sure that this company doesn't add change orders or add-ons that weren't anticipated to move beyond the bid - that if we have people bid but have problems with them and get change orders because they didn't anticipate or renegotiate because specs. didn't include this. He stated we can evaluate our past performance in relationship with those people and should be aware of that.

Mr. Feland stated they did give that consideration and that we do have history and that the latest lawsuit, some was contractor related and for the most part was consultant engineer related, and if look at the whole settlement of the issue, but our engineer feels confident that they can work with John T. Jones on this project, and there is approx. $90,000 difference between two contractors. Advanced Engineering is the design engineer and also observe the construction of the project.

2.7 Request for additional capital improvement dollars for the Alerus Center.
Council Member Bjerke asked if there was a limit on how much they can spend on
capital projects before coming to council. The city auditor stated they have the same authority as other departments do, departments can approve up to $30,000 and they can approve the money that is approved by council to put into their capital budget each year, the reason they are coming to council on this is because they need an amendment to their budget to spend this additional dollar amount. These monies are from 3/4% sales tax.

Mr. Bjerke stated that as one who has requested this, thinks the citizens need to know the capital improvements for the Alerus and need to have discussion whether spend it now and what spend it on. He stated he understands the need for maintaining buildings (basic maintenance, repair, carpet, paint, etc.), however, as far as these particular projects he doesn't know if need more signage saying it is the Alerus building. Since started collecting this tax in April of 1996 we have never received a long term contract with the University of North Dakota, and they were to be our partner; why putting up UND logos, etc. and if they want to put forth their football program that would be their job - questioned on some of these whether priorities and whether this is something this money is to be used for - signage (if advertising in a building should be paying for that).

Council Member McNamara stated with capital improvements think of the fundamentals of the building that he would like to see dealt with first, thinks we have good signage out there and once the long term contract is done, understands the need for the preferred partner-wall and UND football wall, signage to say Home of the Fighting Sioux Football Team or UND, but not sure about the Alerus Center Grand Forks wall for an additional $60,000 - that a long term contract ought to be signed before the citizens are asked to contribute additional money - and should look at nuts and bolts before looking at additional signage.

Council Member Gershman stated that we could approve that part of it next week contingent upon the University signing the long term contract but rather than postpone it would make it contingent upon that; that he has looked at the signage and agrees with the plan that has come forward, that when look at upgrading businesses and renovation of businesses that have to do that, but need to hit the refresh button on signage.

Council Member Kreun stated the have been working on that contract for some time and there are changes in that contract, and if they want to wait, can do that, but the longer wait , less time you have to utilize the benefits that will come about with the football season which is already 2 games down - as far as the other portion of the building if going to be competitive with the other regional buildings as far as Minneapolis, South Dakota, and north to Winnipeg, going to have to stay #1 in the state and in the region - and have to make these changes to keep that facility as up to date as possible, our change has taken place since Canad has come about and the conference center is huge as far as our income draw goes, and some of these things are directly related to preparing us to become better and more receptive to conference type work, and would suggest bringing this forward and passing it next week as presented.

Council Member McNamara stated that the bonds for the Alerus run until 2029, and we are going to get a 10-year contract, (no option on the contract), the City would be covered until 2018-19 and 10-year exposure on the back side of that; would be more comfortable talking about the signage issues to cost of approx. half million, that these are not capital improvements, but cosmetic improvements to the building, if the money exists and is part of the capital plan and are within their budget is something we should look at - seems to be out of order to do the signs and would like to see us deal with this on the backside of that, concerned about the 10-year exposure that we have relative to paying off the bonds and should look at those things and discuss them.

Council Member Gershman stated that the sales tax revenues are significant coming in and within 10 years if you look at the excess in there that can be used for improvements, and the bonds are secure based on the sales tax we have regardless if the University were there or not, but 10 years from now there will be so more things going on at the Alerus Center but aside from that the tax revenue for the bonds makes those bonds extremely secure whether the UND is there or not. The city auditor stated that is correct, the security for the bonds is 3/4% sales tax, no guarantee for debt service payment of any of the operating revenue from the facility and flows quite well so far.
It was noted that even if the Alerus Center closed and no activity and continued with the 3/4% could still service the bonds.

Council Member Christensen stated that the answer is the conversation of reviewing the Home Rule Charter that authorized the sales tax, reviewing the bonds and bond covenants and whether can deflect some of that 3/4% for something else, what changes you would have to do to deflect that; then taking excess revenue and doing more things with the Alerus but question is how quick do we pay it off, same as with the dike, and why carry this out to 2029 when can pay it off in 2020 - that will be discussion and why use this excess revenue and why build this unless going to use it or can we secure what our payments are and use the rest for something else - infrastructure, and if we can, what do we have to do to keep the 3/4% in place but use the rest for something else rather than an expansion of the Alerus footprint and that will be the real discussion in the next 12 to 18 months, where do we take the Alerus, what is the next step, and who partner with.

Council Member Gershman stated the concern he had, that there was a concern about the ability of the risk of the bonds by losing the revenue from the University of North Dakota.

Council Member Kreun stated they are focusing on the UND contract but if only focus on UND football will not focus on the issue of bringing in the conferences where there is a lot of good revenue - this is a part of that process and what asking for next year in the budget process, the 10-year situation on the contract, if we do these things and maintain this level of service and bring back these conferences and bring the football and have the attendance, won't have any trouble getting another 10 year contract., and as far as the relationship with UND is as strong as it has ever been and have had working relationship with several new members on the President's cabinets and want to continue that, lets look at the large picture with open mind and go forward with the large vision for the next 10 to 20 years.

The city auditor stated that the request by Mr. Bjerke at the budget meeting to review the bond covenants, etc., that on November 17 will be selling our refunding special assessment bonds and has asked Brenda Krueger from Springsted and Lynn Endorf from the Dorsey firm to come in that evening and plan to stay over and on the 18th hold a 5:00 p.m. meeting with council members to go through the bond covenants, the Home Rule Charter so everybody can get a comfort level as to what can and cannot be done - will let you know if meeting confirmed.

Council Member Christensen stated they will have a finance committee meeting prior to that time and have the auditor and Mr. Swanson attend so they can prepare a list of questions they would like addressed - would like to have that meeting within the next month and get memo out to members of the committee.

3. INFORMATION ITEMS

3.1 Portfolio Management/Summary as of August 31, 2008.
Information only.

6. MAYOR AND COUNCIL MEMBER COMMENTS

1) Council Member Bjerke thanked fire fighters and Chief O'Neill for putting on Fire Ops 101 and police department and commended those departments, very interesting day.

2) Council Member McNamara commended fire and police departments for responding to fire on Saturday morning on 5th Avenue North; and keep family in thoughts and prayers.

3) Council Member Glassheim stated the Fire Ops experience was really well done and gave a feeling for what people face. He presented two items: 1) to schedule issue of length of time you can have a building unsheathed; 2) that as part of budget resolution talked about starting to look at before December ways to save money and if will move forward - Finance meetings will be on Wednesday during council weeks - and meeting scheduled for next Wednesday at 4:00 p.m. and will continue with meetings.

ADJOURN

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

Respectfully submitted,



John M. Schmisek
City Auditor