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COMMITTEE OF THE WHOLE
Monday, September 24, 2001 - 7:00 p.m.

The city council met as the Committee of the Whole on Monday, September 24, 2001 at 7:00 p.m. in the council chambers in City Hall with Mayor Brown presiding. Present at roll call were: Council Members Brooks, Bjerke, Stevens, Hamerlik, Burke, Glassheim, Gershman, Lunak, Christensen, Kerian, Bakken, Kreun - 12; absent: Council Member Martinson - 1.

Mayor Brown announced that when addressing the committee to please come forward to use the microphone for the record, and advised that the meeting is being televised live and taped for later broadcast.

COUNCIL MEMBER KLAVE REPORTED PRESENT

UNIVERSITY OF NORTH DAKOTA RECRUITMENT UPDATE

Dr. Robert Boyd, Vice President for Student and Outreach Services at the University of North Dakota, 1371 South 38th Street, and Alice Hoffert, Associate Vice President for Enrollment Management, 2120 9th Avenue North, stated that their purpose for being here tonight was to say thank you, that the City did include in their budget $100,000 for the recruitment and retention of students at UND and thanked city council for their support in the past and for potential support in the future. They stated they have an enrollment figure of 11,764, compared to 11,031 last year, and that this is done because of tremendous partnerships all through the University and through the community; and have honored their commitment to the City where they use those funds for one-time only, use specifically for recruitment and retention .

REMINDER OF SPAGHETTI DINNER

Ed Grossbauer, Fire Department, gave brief update on spaghetti dinner which will be held on October 2 at the Alerus Center from 4:30 to 8:30 p.m. and to give everyone an opportunity to donate their time - to give them a call at the fire station.

THANK YOU TO KNIGHT FOUNDATION FOR GRANT

Terry Hanson, Urban Development Office, reported that Meridith Richards, project coordinator in their office, submitted a grant application to the Knight Foundation for assistance in capital and cultural amenity improvements in the downtown area; that on September 4 of this year they received a letter from the Knight Foundation awarding the City of Grand Forks $20,000 for capital improvements to enhance the cultural educational and historical role of the city’s downtown; that they will be working with the downtown leadership group in the coming weeks to develop projects to creatively utilize these funds, and wanted to officially and publicly thank the Knight Foundation for providing these funds for the City.

MAYOR’S UNOFFICIAL PROCLAMATION

Mayor Brown announced that the city council challenged the department heads to a round of golf and the city council had 152 and department heads 147, and without regard to the score - “I, Mayor Brown, in the interests of seeing this become an annual event, proclaim this year’s city council the winners of the city council department head golf scramble, and presented donated trophy to city council president Hal Gershman on behalf of the department heads with a clear understanding that the “winners” will set date and time for a rematch.”
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SUSPEND AGENDA TO CONSIDER SEVERAL ITEMS

Council Member Kreun moved to suspend the agenda to consider items 2.14, 2.15 and 2.13, seconded by Council Member Klave. Carried 13 votes affirmative.

2.14 Ordinance allowing sale of sales and use tax bonds.
The city auditor reported this is a matter where the council will be introducing an ordinance allowing the issuance of use tax funds, had an election authorizing the use tax and intent was to fund a portion of our debt on the dike with that. Al Erickson, Springsted, reported that the ordinance was drafted by bond counsel, Lynn Endorf of Dorsey & Whitney, and basically gives City the authority to proceed with the bonds and proceeds which will be scheduled to use for the continued construction of the dike; and will be asked to pass ordinance on first reading on October 1 and second reading on October 15.

2.15 General Obligation Public Building Refunding Bonds, Series 2001C - Call for Sale.
Mr. Erickson stated this is a $1.235 million general obligation public building bond, which was issued originally in 1991, feasibility reports were run the end of August which show a future value savings of about $75,000, this is becoming a current refunding - that the first available call date is December 1 and first time can pay it and basically swap out of the old debt and into the new debt, similar to refinancing your home mortgage - but with rates the way they are now this appeared to be a favorable refunding - this was based on rates as they were at the end of August, since the incident on September 11, have noticed rates have dropped even farther. He stated that next week the council would be asked to set the sale date for this particular issue, which would be the 15th of October. There was some discussion as to extending this to November 15 for lower rates - Mr. Erickson stated if it’s $75,000 on this basis, probably say will be $80,000 or little bit more with current rates the way they have come down in the last week or so - and possibility rates may continue to trend down or may not, and cannot extend because run into call feature and timing to give notice to the current bond holders.

2.13 Application for transfer of a Class 1 (General On & Off Sale Alcoholic Beverage) license from
J.E.P., Inc. dba Westward Ho Entertainment Complex to L.T.D. Investments, Inc. dba Babylon, 9 North 3rd Street._______________________________________________________
Council Member Christensen moved to convene into a special city council meeting to vote on this issue, Council Member Lunak seconded the motion. It was suggested that they have the discussion before determining whether or not want to vote on it. Council Members Christensen and Lunak withdrew their motion.

Council Member Brooks asked how Babylon had been operating before; Dan Sampson stated they were using the liquor license from The Edge under a temporary permit for events. Council Member Hamerlik asked if this was a transfer of a license from the Westward Ho group. Mr. Swanson reported that under the City Code if it were determined to be within a “family” or within the same corporate stockholder there would be no transfer fee at all; that in this case because it’s not within the same family or shareholders or partners, it is a transfer which must be approved by council and requires a transfer fee of $10,000 to be paid as well as the additional license fee itself. Council Member Hamerlik asked if there was the possibility of transferring a license if there is litigation involved in some way or which might have as an asset. Mr. Swanson stated that under our Code a liquor license cannot be held as collateral, cannot be pledged nor secured, and not aware of any bankruptcy proceeding which would involve the license as such to be transferred, and that would be outside the scope of this body’s control. Council Member Brooks stated they
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received a letter which he has some concerns of some other issues that have been brought to their attention, but thinks this is separate and relates to some concerns with The Edge and is separate from the issue before us which is a license for Babylon.

It was moved by Council Member Kreun and seconded by Council Member Lunak to suspend the rules and convene as the city council session and consider this item. Carried 13 votes affirmative.

CONVENE AS CITY COUNCIL; AND RECONVENE AS COMMITTEE
OF THE WHOLE

The committee of the whole convened as the city council to consider item 2.13 (Application for transfer of a Class 1 (General On & Off Sale Alcoholic Beverage) license by LTD Investments, Inc. dba Babylon, 9 North 3rd Street).

After a brief city council meeting, the committee of the whole reconvened with all members present.

2.1 Part-time ordinance.
The city attorney reviewed the draft ordinance which was on council members’ desks and to explain intent of various changes included and may give some background for discussions on the part-time employees and classification of various positions; that there are minor changes in the draft he wished to point out.

Council Member Burke stated that the memo at the end of the draft ordinance indicated there’s a lot of things related to this that are yet to come from both staff and the attorney with regard to portions of the ordinance and other ordinances they might want to implement; that he would rather see it all together rather than do it piecemeal, that some of the things coming are substantial and would like to have this pulled from next week’s agenda and wait for several weeks until have it all in a package and do it together. Mr. Swanson stated that procedurally this body has adopted a resolution previously where they would not take any motions or vote in capacity as committee of the whole.

After some discussion the committee asked that Mr. Swanson proceed with his review.

Mr. Swanson reported that in Section 6-0101, number of definitions, error in subdivision 2) Dealing with anniversary date; all doing with the change in anniversary date is to identify that date deals with the date of hiring, and for other purposes such as future salary increases he added conversion of a non-classified position to a classified position and encompass step increases.

Subsection 8) added definition of a classified employee, intent of this ordinance was to change the definitions and to eliminate different classes of employment to come to two classes - either as classified or unclassified position; only exception is later on and termed emergency. He stated in the classified capacity that may involve an employee who is working 40 hours/week and considered full-time or can involve employee that is working less than 40 hours/week. Council Member Hamerlik asked where is the seasonal employee; Mr. Swanson stated the eliminated the definition of seasonal employee as did with temporary employee and that he understood that there no longer are classifications such as seasonal, temporary or permanent part-time employees (that they are striking the definition of seasonal and striking the definition of temporary, and in substantive portions of the ordinance (6-0524) there are provisions for temporary appointments and those are limited in term of length (two possibilities for temporary employments). Council member
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Hamerlik stated a concern that a seasonal employee (that winters last longer than 90 days and grass cutting, etc. longer than 90 days) and how they would fit in for those people that have been employed. Mr. Swanson stated they will get to those issues when get into the substantive sections, and not sure that’s a definitional concern, but his understanding of the former committee and the subsequent recommendations from the administrative coordinator is that no longer going to have seasonal employees, that if they wish to maintain seasonal employees, this draft would need to be modified to include that. Mr. Hovland stated that the seasonal in the model presented by Mr. Duquette, seasonal would be anything less than one year in a non-benefited position and would have to reinstate the seasonal.

Mr. Swanson stated that on page 2 in light of that information 22) will have to remodify the changes to the changes to the definition of an employee (were deleting seasonal). He asked if it was the intent of the council that the seasonal employee would be considered a non-classified and if there was a need to maintain the definition of seasonal if in a non-classified position. Council Member Christensen stated if we have non-classified employees they could be part-time and would fall into the seasonal and wouldn’t have to have a seasonal definition. Mr. Hovland stated if employee less than 20 hours and less than one year; he stated have classified and non-classified and reason for seasonal helps their department and finance as to determining for benefits (seasonal should not be a benefited position). Mr. Hovland stated that employees will know as a condition of employment, term of office.

Mr. Swanson stated that Section 6-0524 would appear to be best vehicle to either allow or regulate or both temporary employees - that they are reviewing the definitional section and regulations may appear later in the substantive section of the draft, and the draft does not address the issue of seasonal employees in manner being discussed.

He stated on page 3 of the draft - definition of full-time employee 24) has significant changes because simply trying to identify without putting requirements in, what a full-time employee is - those requirements no longer necessary or will appear later in substantive provisions. In sub-section 26) deleted the definition of job-sharing (to allow people to work less than 40 hours per week in one position and that the two individuals holding that position could receive pro-rated benefits). He stated basic premise of the ordinance is that benefits will now be pro-rated and no longer need for job-sharing.

Mr. Swanson pointed out an error in subdivision 30) definition of non-classified employee, second line says “ position as defined by” and should read “position as designated under Section 6-0103”. He stated that was defined as “permanent part-time” is eliminated and substituted with “part-time employee”, doesn’t reflect whether classified or not but simply relates to hours and becomes important for overtime compensation, compensatory time and scheduling. He stated he was trying to accomplish to remove some of the substantive limitations or regulations from the definition section and put them in the body of the ordinance.

Mr. Swanson stated on page 4 , added definition for pro-rated to identify that pro-ration is based upon a 40-hour work week, that police and fire under Fair Labor Standards Act can be calculated on something other than a 40 hour work week - this deals with pro-ration of benefits. Number 46) seasonal employee had deleted it, and will have to be addressed and redefined or added back in.
He stated on page 5, definition of 51) of a temporary employee was deleted.

Page 6 continuation of scope and application of civil service code we made a specific change in
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subdivision f) to delete the references to seasonal temporary or part-time employment, and were attempting to give the council discretion that may likely come about in your budgeting process when you approve or identify what departments have for classified employees; the only body that has the ability to determine classified and non-classified, other than the mayor or short periods of time, is the city council.

Council member Glassheim asked how they get a non-classified position - that the mayor and departments would submit a list of requests for non-classified positions during budget time, etc. and that we would approve a non-classified position, and do they need anything that says how they get non-classified positions or is implied. Mr. Swanson stated the Code doesn’t address that, that in the budgeting process a department’s budget identifies the positions that are budgeted for in the classified service; those positions that were not classified appeared in items identified as part-time or temporary, something different than the classified, and envisions that type of process continuing in the budgeting information when looking at department budgets as to what their staff is. Council Member Glassheim asked if there should be a methodology whereby they approve specifically a non-classified position. Mr. Swanson stated it could be included in the code, that in the past the council had said no new classified positions and the budgets for part-time temporary kept increasing - whether they want to adopt separate motions on each budget during budget process addressing classified non-classified would be within their prerogative. Council Member Glassheim stated he wouldn’t mind seeing a draft that specifically gives them the authority to approve non-classified positions. Council Member Brooks suggested probably having a dollar figure and if line item for non-classified positions. The city auditor stated he sees from past practice the council moving away from that because they had line items for temporary employees and if look at last few budget books, have had departments detail what positions are included in that temporary category and have done that by adding temporary positions under there and letting them continue and have started trying to define those positions so that council could look at department by department to see what positions are in there and either approve or not.

Council Member Christensen stated they have Section 6-0205 C) the civil service commission is to report to council reclassifications by January 20, but envisions as ordinance is drafted that 6-0524 that may end up having for all non-classified positions that have been in existence for more than a year as part of the budgeting process, and why departments would continue with those temporary appointments or else gone. He stated the temporary employment language needs to be reworked because it’s 90 days and if emergency, can extend it for another 180, but simply a temporary appointment is for less than a year, included within the current budget and funds available.

Mr. Swanson stated that on page 7, significant change in policy as it relates to benefits for those employees working less than 40 hours per week, now employee must first reach a threshold before they are entitled to benefits and then receive those benefits either in the latter part of the year after they’ve met the 1040 hours or in the year following; inconsistency it leads to is may have an employee who works 90% or 100% in one year getting no benefits and the following year working 20% of the time and getting 100% of the benefits - that in the draft will be going to a budgeting process where the department head is looking forward to the next fiscal year and saying that this employee is anticipated to work 80% percent of the time and provide 80% of benefits; and is significant change in what have done before, and council sets the types of benefits that are extended.

He stated that 6-0414, tuition reimbursement program, only change is that it extends that to apply
to those employees working less than 40 hours.
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He stated on page 8 - Re-assignment examinations; that the draft provides the civil service commission with broader authority to determine when an adequate pool of candidates exists, and they can consider those employees that are presently holding a non-classified position as part of an internal re-assignment pool - re-assignment may mean promotion or changes in one department from to another.

Council Member Hamerlik asked if we are in compliance under ADA with the re-assignment examinations or any examinations that transpire. Mr. Swanson stated he was not aware that we’re not in compliance - the ADA is going to override any register, whether re-assignment, eligible, reemployment. He stated any individual claiming a disability under ADA is allowed to request an accommodation for the disability and the City is obligated to provide that; and nothing in Code to allow the City to avoid the accommodation. Mr. Hovland, ADA coordinator in temporary capacity, stated they have had incidents where people have contacted them and have someone who will actually sit down and read the questions to them and they can take an oral exam.

Mr. Swanson stated next change on page 10, subsection 4) re-employment register - this is situation where somebody has left the employment of the city in good standing and has placed their name on a register that in the event that they wish to be returning to the employment of the city, that they get some preference in that re-employment and has been used on several occasions. He stated 4) was added to allow the situation where an employee was re-employed by the City of Grand Forks - the commission has the authority to place that employee back at the same level of benefits they were before (vacation, etc.) Council Member Christensen stated that when an employee resigns they should give up what they accrued before they resigned so have to weigh whether or not resign and seek employment elsewhere - shouldn’t be allowed t step back in and go into same position once have left. - if quit give things up, and start over. This was added to give the commission the ability to provide a recruiting tool for somebody who has left and come back. - not mandatory and not authorized. Several other council members agreed with Mr. Christensen.

Mr. Swanson reviewed changes on page 11 - previously termed emergency appointments - now identified as temporary appointments - this would be an appropriate place for addressing term of employment, whether less than a year, etc. - emergencies are no longer required and should refer to circumstances or temporary appointments. He stated difference between 1) and 2) - 1) stated mayor would have the authority to hire an additional member to come into a department or to hold a position because of an unmet need, subsection 2) is really intended to allow the mayor to take somebody out of the finance department and put them into assessing department for example if there were a particular need that assessing had for a short period of time - unrequested transfer even though short time. Redesignation or reallocation of resources. Intent was to give the mayor the authority to respond to quick changes in need or employment issues.

Council Member Hamerlik stated that they did not include his statement who believes that anyone hired for a temporary position is not eligible for the same position on a permanent basis or a classified basis. Mr. Swanson stated there was nothing drafted to create that type of a wall. Mr. Hamerlik stated his concern is that it’s quite easy to appoint somebody temporarily and then even if reappointed for a short period of time, they gain the expertise and they are the most qualified, and that’s one way to circumvent the whole classified system and believes that person appointed on a temporary basis should be ineligible for the same position on a permanent basis or classified. Mr.

Swanson stated that the decision to hire requires both the department head approval and the mayor’s approval or concurrence - he stated your goal is to hire the most qualified employee.
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Council Member Bjerke stated he didn’t see a procedure to reappoint here and thought we were trying to get away from temporary appointments and thought were going to have classified, contract employees and seasonal employees - where getting back to temporary employees and if classifying people was to not have temporary employees. Mr. Swanson stated the job requirements in the field don’t allow you to easily eliminate short term employment situations, what they did was to narrow it to 90 days and within that 90 days should be able to create a roster for permanent position - the intent was not to allow what has occurred where individuals have maintained temporary positions year after year, etc. Mr. Swanson stated their purpose in drafting this was 1) put common sense in here, and to allow the mayor to respond to quick changing needs (windstorm, snowstorm, etc.) without tying the department’s hand and mayor’s hands too much - but if it is the intent of the council to eliminate possible reemployment of the same person, then may wish to consider beefing language up and putting an express provision in there. - were trying to give the mayor authority to respond to a particular need. Mr. Brooks stated re. issue of excluding temporary employees from permanent positions, aware of that at other governmental agencies, and not sure if to specifically exclude somebody from the possibility of applying for a job - what we want is to hire the best person for the job. Council Member Burke suggested that this paragraph survive the way it is right now, and to add that when a temporary appointment is made, that it is reported to the city council. Council Member Hamerlik stated he would be more comfortable if there would be a statement that no re-appointment after 90 days, except in the past have had declared emergency by the mayor, and that could be re-appointment in emergency situations over specific period of time.

Mr. Swanson stated that Section 6-0807 - Vacation Leave and 6-0808 Sick Leave, 6-814 Bonus Personal Leave are modified to incorporate the potential of pro-rata benefits and to eliminate definitions such as permanent part-time, etc. , no substantive changes in those sections. Council Member Hamerlik stated that in 6-0814 he suggested there should be other bonus personal leaves and may pro-rated should be included - personal leave for attending conferences, worksh0ops, etc. and maybe council wishes to address that. Mr. Swanson stated that was not included because it has been policy established by the mayor as to what programs, conferences, etc. department heads and their staff were going to be authorized to attend, within their prerogative to include that. Council Member Burke stated under Sec. 6-0807, paragraph 8, he would like to see the personal leave paragraph deleted and add the 8 hours to each of the various seniority brackets under vacation leave - so each bracket starting with the 6 to 12 months would be bumped up by 8 as he didn’t understand the difference between vacation and personal leave, and under 6-0814 defined not as personal leave but 8 hours of vacation based on same criteria. Mr. Swanson stated that is discretionary or prerogative of council, one effect is that personal leave hours may not be reimbursable upon leaving the employment of the city, where vacation days are. Council Member Kreun stated that personal leave is a situation where may have house closing, funeral, and if give it as vacation and taken as vacation, and then come back for additional time - vacation pay is reimbursable at time of departure where other types of benefits are not - could come back in negotiations later that want personal leave time. Mr. Swanson stated that some employers are going simply to a concept of paid time-off and not distinguishing between whether it’s sick leave or vacation, etc. Council Member Christensen stated re. 6-0807 Vacation Leave have added a new item where part-time employees shall receive a vacation leave on a pro-rata basis and is a question of policy if talking about part-time how accrue vacation time, if seasonal, and if classified part-time might be different, and suggest that might want to include the word classified part-time employees;
Mr. Swanson agreed with Mr. Christensen; that paragraph was added to that situation in which you are allowing those persons working less than 40 hours in a classified position to have benefits pro-rated - was trying to distinguish that from what is in subsection 1) which is granting the full
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schedule of vacation to full-time employees. Mr. Christensen stated in sub.sec. 5) on page 17 - have written requests must be submitted to the mayor by December 31, 1998 and extensions to December 31, 2000 - Mr. Swanson stated that subsection had to do with a change in policy for employees employed at a certain date and were being requested to utilize or extend certain benefits - that whole subsection could be eliminated because that period has expired - he left it in simply for historical value that could point any employee that was employed prior to that year but continued to be employed - but could do it with historical archives (that occurred after the flood when mayor denied any use of vacation and didn’t have the opportunity to use it). Mr. Christensen stated that the concept of vacation is to recharge yourself, etc. and wondering if either use it or lose it - it is intended to avail yourself of benefits but to accrue vacation for an unlimited period of time and wondered if want to continue the policy of accruing vacation - maybe portion and balance has t be used. The city auditor stated this doesn’t allow the employee to accrue unlimited vacation, it allows employee to accrue up to two years of vacation and then have to use it or lose it. Mr. Swanson stated that can be re-drafted but the intent is that an employee within a two-year window has to utilize their vacation - that policy was changed a few years back because prior to that there was unlimited accrual.

Council Member Christensen stated that unused sick leave may be accrued on an unlimited basis
and this is policy and if taking away vacation and if don’t use it - why accrued unlimited. Mr. Swanson stated you don’t buy back sick leave on a dollar for dollar, vacation do; there is a cap on sick leave (purchase one half) . Council Member Bjerke stated if you don’t allow them to accrue you are to some people going to encourage them to use the sick leave on a very regular basis - possible. Mr. Hovland stated there is a cap currently of 960 hours for sick leave. The city auditor stated when that settlement in payback of sick leave was negotiated, there is an accrual of 960 hours to qualify you for payback of sick leave, you can continue to accrue sick leave if you wish to or take half-payment every year of the unused portion of sick leave at current rate of pay; and 50% of 960 at current rate of pay when you leave.

Mr. Swanson stated the other substantive change appears on page 19 dealing with the order of lay-off, what attempting to do is to recognize that we have changed definitions and now characterizing this as a non-classified employee must be laid off first in a reduction of force action before any classified employee.

Mr. Swanson stated that his office is looking at a technical corrections ordinance, over the last few years have modified some Code numbers and have some interior citations within the Code of other sections that appear to be incorrect, and would bring that as a separate ordinance to correct those errors. He stated he was willing at any time to meet with council members or receive calls, comments or questions if there are particular drafts or re-drafts you want.

Council Member Brooks stated he would like a requirement of five days vacation each year; Council Member Kerian suggested that be phased in so that they could accumulate some time. Mr. Swanson stated at the last council meeting you passed a motion to table the consideration of this ordinance until your second meeting in October (October 15), and reason he asked that this be on your agenda tonight was to give him the opportunity to hear comments and have time to draft and distribute prior to the second meeting in October.

There was some discussion on temporary employees - when authorized by council. Mr. Swanson stated he thought the understanding was that the council would make those decisions on a department by department basis during the budget year; and would suggest to the HR Office that
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when dealing with those that they be converted to or dealt with under a written contract, which is
the exact manner that the CDBG employees were dealt with so that there is very clear under-standing on term of employment, length of employment, etc. Council Member Burke asked if he could put that into a draft - that if not included in one of the categories of employment, that they would have to be contract employees. Mr. Swanson stated that the way the draft states is that it is up to the departments to determine in what manner employees are hired and now changing that to limit that to either be classified or non-classified and non-classified can only be approved by the council - that by allocating a line item in the budget have authorized unclassified employees.

The city auditor stated that when they were discussing non-classified employees as staff, if was their intention that that grouping would include those categories called seasonal or temporary and would be their intention at budget time that when you see that category, will see listed number of seasonal employees at so many hours and that those are the non-classified category that won’t be receiving benefits.

Council Member Bjerke stated there is a policy to hire seasonal people but not included in the ordinance. Mr. Swanson stated that this draft didn’t contemplate seasonal employees because they are contemplated to come under approval of non-classified employees, and he suggested that if you wanted to include seasonal, the place to include it would be in Sec. 6-0524 which is now temporary appointments and will need some re-working. Council Member Christensen stated they are trying to give benefits to our classified employees, whether part-time or full-time - that non-classified employees, part-time would include seasonal, and would like to have something broader rather than restrictive so that the department heads can do what we’re moving forward here, to give them more authority to manage - and if they get a line item for funds they get it or otherwise manage with less money; and would like Mr. Swanson to redo this ordinance with classified and non-classified, part-time is less than 40 hours, and see what we get and move forward with that. Mr. Hovland stated it was their intent with Mr. Duquette and Mr. Swanson to look at our current policies, look at this ordinance and bring it back to the council.

CONVENE AS CITY COUNCIL, RECONVENE AS COMMITTEE
OF THE WHOLE

Council Member Kreun asked to suspend the agenda and moved to consider item 2.12 at this time, seconded by Council Member Gershman. Carried 13 votes affirmative.

2.12 Application for a Class 4 (Food and Beverage Establishment) license by TOSCO, Inc. dba
Buffalo Wings Grill & Bar (Todd LaHaise, President)______________________________
Mr. Swanson reported this is an application for a new Class 4 alcoholic beverage license which has been reviewed by his office and approved, that it is in an existing location where there is a restaurant, however, the existing restaurant does not have a full Class 4 license, the application appears in order but would be subject ultimately to approval by the various review departments, including police review, fire review, health department review, inspections review and his office. Todd LaHaise, applicant, stated they would like to move forward as quickly as possible, that they have a contractor, Innes Construction, that would like to start remodeling the building before winter.

Council Member Christensen moved that the committee of the whole convene as the city council; seconded by Council Member Gershman. Carried 13 votes affirmative.

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Council Member Bjerke stated we have agendas published in the paper for a reason and we’re getting into the habit of voting on items on committee of the whole as a city council, when people are not expecting that to happen.

Item 2.5 Award contract for relocation of historic homes. U
This item was also considered by the city council at their special meeting.

After a brief city council meeting, the committee of the whole reconvened with 13 members present.

2.2 Urban Development restructuring.
Council Member Gershman stated that after reviewing this, that we have not hired an urban development director, and now council saying to restructure urban development, that after those who were last elected to council, they spoke to the past administration and to the council at that time not to put in place certain positions because they wanted to have the opportunity to discuss those issues as have different ideas - that if going to hire an urban development director and go on a national search, he or she would probably come in with innovative ideas and want to come up with ideas for the restructuring of the department, and doesn’t think we should be talking about this prior to going on a search and hiring an urban development director. Council Member Glassheim stated the council has held on getting anything organized for months and department has been trying to get itself reorganized and for some reason some members of the council have not wanted that to happen, and almost seeing this as an attempt to cripple the operations of the department by not making a decision, that people always come in to an existing department and if the new person wants to change the structure later, they can make proposals and leadership moves forward; that it’s time to move ahead, department is understaffed and positions have not been filled while waiting for the restructure; doesn’t think sound policy to use that as a reason and wait another six months when already waited perhaps a year to restructure the department.

Council Member Burke stated it would be difficult to hire someone to come in and take over a department as it is constituted right now with the knowledge that we’re probably going to tear it apart or change it substantially; that it’s better to work on the restructuring based on what we know and with input from staff and from the Housing Authority, and come up with plan and move ahead and have department structure that the new person can come in with sense that it’s going to be there for awhile. He stated with the plan presented to the council, it’s his sense that Housing Authority may have some different feelings about the relationship of the Housing Authority to the City and the Urban Development Department, and perhaps should have task force to work on this with the Housing Authority to see if can’t come to a meeting of minds, whether it’s to continue as it is now or find some other relationship. He stated when he read the job descriptions for both the executive director and the Housing Authority director, there’s mention of the HA but it says that these positions the line of authority goes up to the mayor, and how the HA can direct activity in the Urban Development Department of employees that report solely to mayor or mayor’s subordinates.

Mr. Hovland stated that Urban Development is unique, they have the HA as a leg of one of the three entities, objectives he’s heard out of this chamber are affordable housing, economic development and quality of life - this is the only department that addresses all those issues - HA,
have HUD, some grants, projects, and restructure bringing before council is at no cost to the General Fund, but it streamlines the department so they can do those three objectives outlined by the mayor and the council. He noted that the functional responsibility under the Housing
Authority lies in the housing department under Urban Development. which would report to the executive director under the direction of the mayor.
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Council Member Brooks stated we need to do something with this part of our organization - economic development and that’s one of the crucial areas we have - that’s our future. Council Member Bjerke asked why this department has its own finance department, and if there was a potential cost savings if those people moved into our finance department; that over half the employees are Housing Authority employees and asked if the City were reimbursed for all the HR time, finance time to do benefits, etc. ; that once appointments made to HA, those people become independent authority and majority of this department we don’t have much to say. He stated that funding for the jobs, they control those funds and not any problem finding funds to create all these jobs, that the HA and Urban Development are recruiting people to go on government assistance, then we’ve created a whole group of employees to get people off government assistance; thinks there’s a conflict of interest in this department. He stated in job descriptions doesn’t say that they report to or anything to do with the administrative coordinator.

Mr. Hanson stated what they do with the department is their decision; the federal government began housing program back in 1936 and HUD is one of the largest departments on the federal government; they do not create the programs in their office, they administer it for the citizens of Grand Forks because we are an entitlement city for the federal government fund; and takes exception that they created the programs - trying to provide the LMI families in the community with funds they have entitled to come to them because the federal laws have been passed in Washington.

Dawn Wilke, HR, stated the reason they wanted to look at this is to view the current structure, these are current classified city of Grand Forks positions,; that HR is proposing what they identified as staffing needs and an organizational chart that fits right now (this could be changed at any time) and addresses concern with the temporary employees ending in December; and is similar in concept to what they did with the Health Department and are asking for 7 additional positions to be funded through special project or grant funds that will be made into classified positions, identified where they need to go - that the bigger issues such as economic development, issues of Housing Authority even being a part of the city - those are issues that council needs to decide together with the mayor and those entities and not for the purpose of HR identifying staffing and an organizational chart that fits under the mayor.

Council Member Lunak stated HA helps LMI, program been in effect for quite some time, disagrees with the HA Board members, should be represented by more city council people; put all finance departments together, also duplication of services; and if wait for 6 months to a year for restructuring, people not sure if they will have a job; and should make the decision next week.

COUNCIL MEMBER LUNAK EXCUSED

Council Member Christensen stated he felt they should go forward, and if go to the market, that person will make recommendations to council - he stated one of the questions is economic development, they funded the EDC for one year in 2002, and one of the questions when go to the market for executive director is should the position have anything to do with economic development or should that be something that is excluded from the position and look to EDC to do economic development in this community, and should be dealing with that before going to the market for executive director for urban development, or should the city be in the business of housing - there is
money that comes from federal grants attributed to housing and has seen budget and the monies that HA administers (money that people get for housing) and some administrative overhead tied with that; and council will have to address is should the HA be part of our economic development
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office and continued function of the city; and asked what our urban development office be charged with doing - define that and then make sure we have these other things and they’re properly staffed and properly funded. He stated this should go forward and should make a decision of whether or not we want the HA to be under Urban development or if HA should gear up and have more people, etc. and generate more revenue as a separate entity - he stated they ran on accountability and nobody on the HA Board is accountable to the council - that they are appointed positions, not accountable to the citizens - they are accountable to the mayor if the mayor chooses to not reappoint one of those individuals; that this is a big issue - the HA runs about $5 million a year of the $13 million the Urban Development runs and he has seen first hand the lack of communication between the EDC and the HA when sat on the Growth Fund - and need to ask whether we want Urban Development to have economic development any longer or want that to become part of the EDC - have a lot of policy decisions to make.

Council Member Bakken stated he’s not sure what Urban Development does - that pre-flood they did very well, had a team that did a lot of good for the community, housing, elderly, rehab., that Mr. O’Leary and Mr. Olson worked together - after flood they took on the job of managing the CDBG funds that came in, not everybody liked the way it was handled and that wasn’t part of their normal job - not sure the program was broke pre-flood and program may have changed since then and people’s opinions may have changed about an organization that was very well run - it just happened to be in a position that they had to stand up, make some decisions and get a job done that was above and beyond their control and working conditions that they never worked in before - and if Mr. Hanson wants to reorganize his department, doesn’t have a problem with that, but before dismantle this we need to understand how it worked pre-flood, maybe figure out how get it there again.

Council Member Gershman stated he did not bring this up as a delay tactic - that he thinks when go out on a search that it would be attractive to the person to be able to create the department with the ideas that person would bring in, attraction when create their own team; he stated if they pass it and go out and hire director and they want to make any changes, there will be resistance to any change; and need to start the search and would vote against restructuring.

Mayor Brown stated his understanding was that they wanted to see what was going to happen to the department before recruiting and were told to put this on hold by certain council members and now moving ahead with it.

2.3 Affordable Housing Programs.
Council Member Kreun stated he and Mr. Hanson have come to a very simplified format if they look at the staff report that was submitted in their packet, they tried to get the majority of the targeted areas of people that should own homes, that in previous conversations that Grand Forks is
somewhat behind in its home ownership and some reasons for that - it maybe college city that has a lot of mobility, etc. but still somewhat low even comparative for that reason. He stated they’ve had another situation, that the City owns many lots within its city limits that were left to us from the flood and need to have something to do with those lots and want to grow our community. He stated this becomes a part of the economic development as far as housing goes, becomes a portion of our retention and recruitment of what Mr. Glassheim’s task force is trying to accomplish with
promoting growth within the city, and also helps in increasing tax base and several reasons behind
this and would like to put them together in a long term situation, not a quick fix, long term process and set up to be sustained for a long period of time.

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COUNCIL MEMBER BAKKEN EXCUSED

Terry Hanson, Urban Development, reviewed the various affordable housing programs listed in the staff report; that many of the programs have been presented before and reviewed that along with funding sources and level of funding they should have:
1) Home Ownership Assistance - funded with HOME dollars from HUD, passed through the State to the City at a rate of $460,000/year - they would provide $15,000 down payment assistance to LMI families (80% of median income and dependent on family size) for first-time homebuyers.
2) Acquisition Rehab Program - grants LMI households whether in conjunction with acquisition of a home or to someone who has purchased a home and needs assistance in rehab. that home.
3) In-fill Housing Program - could provide lots to local contractors or developers, to include non-profits, to develop homes that have a capped selling price because of lots that the City would mortgage. LMI Program.
4) Affordable/Energy Efficient Home Construction Pilot Program - suggested using $300,000 of HOME funds - program working with Dept. of Comm Services under ND Dept. of Commerce and they are working with the Dept. of Energy and we are working with Eastern Dakota Alliance to build some cost/energy efficient homes that would be made available to LMI families - use funds to construct these homes.
5) Down Payment/Closing Cost Assistance (using CDBG funds) - on-going program - rate increased to $5,000 max. per applicant.
6) Single Family Rehab. Program - ongoing program after flood of 1997 - Red River Valley Comm. Action Agency has been administering that program.
7) Rental Rehab. Program - on-going program. (funding from repayment of previous loans) (dollar for dollar match from owner and 51% of units within any one project have to be LMI to qualify)
8) Lot Mortgage Program - and 9) Non-LMI/Affordable Home Ownership Assistance - for LMI
down payment assistance program to be funded with City dollars made available to families with immediate income of 80 to 120%, and could be limited to first time home buyers or could be expanded to families that already own their homes
10) Property Tax Abatement on New Construction - City would authorize up to full tax abatement for 2 years on first $75,000 of new construction - City would not be disbursing those funds but tax abatement for property owners of any home builders.
11) Property Tax Earmark - Fund non-LMI home ownership programs.

Council Member Kreun stated if they look at the excess of the Cirrus Investment income - this is supposed to be an affordable housing trust fund that will be revolving for a long period of time, and this way we do not take anybody’s tax dollars - not taking General Fund tax funds to fund anybody’s homes or anything of that nature, and that the sale of the in-fill properties, after a period of time when those are purchased and the payments start to come back in, they go into the trust
fund and that will build and can accommodate more people into the program - to qualify these particular individuals in the last two categories would have to meet all the qualifications that would go to a lending institution. He stated sometimes we limit to first time homebuyers and limit to new construction, and some may want to stimulate the existing home market - make sure don’t exclude them. He stated sometimes difficult for first time homebuyers, not necessarily the interest and principal payment and taxes, etc. - but coming up with the down payment and the closing costs and those are some of the programs we have in both the low to moderate income and the 80 to 120%
median that would be available to. He stated they tried to hit a broad spectrum of citizens in the community. If get more people into homes, they will stay in the community longer, build tax base and that this is a long term program.
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Council Member Gershman asked if there was any restriction on the Cirrus money - Mr. Hanson stated none at all. Council Member Christensen stated that the Cirrus money may already be spoken for or in the process - this goes to earlier statements re. urban development and whether or not urban development should have the economic development function or not, that at the EDC Board meeting they had some conversation as to whether or not Cirrus wants to expand - and another entity in this community is looking for $1.5 million and we only have around $600,000 or $700,000 of unencumbered sales tax for 2001 and collect some in 2002 but consumer seems to be down a little right now; that they were warned by others as to the tax abatement for new home buyers; a source of money that hasn’t been addressed is the money they are getting from rental on the Amazon building, and the money that is soon going to come into this city next year when people start paying back their business loans and had approx. $4.5 or $5 million out; and not sure want to take the Cirrus money to fund this program - and know that we have between $350,000 and $500,000 of rental income on some of the properties in the Industrial Park - not sure its step we want to take at this point by encumbering money that has no strings attached as several things coming down the pike.

Council Member Kreun stated we don’t want to take a lot of time before getting the program going, take few years to get it going, and then it will sustain itself; that there are a lot of things that haven‘t been discussed. Mr. Hanson stated that Mr. Christensen mentioned the re-payment of the business loans and/or the loans as a result of the flood, when those dollars come back they are included in our proposal because those are CDBG dollars, not included in funding here, but will have to go into the CDBG program and add to that entitlement funding. He stated the approx. balances that they have available to date in the economic development funds are $4.8 million available and through next year estimating should have $5.9 million available; the revenue that comes off the Noah’s Ark building from tenants, if there is any program income, 25% of that program income is directed towards the CDBG Program because the building was built with a portion of CDBG funds, but the remainder of it goes into 5996, there are restrictions on those funds that they be used with EDA (used for one of three purposes - carry on the operation of that building, to do another project like that building or economic development, or capital improvements that involved economic development or Industrial Park, and can’t pull those out of there and direct them towards housing programs downtown. Mr. Hanson stated proceeds of loans would be used to continue the LMI programs that are listed and could not be used to fund the last four programs. Mr. Christensen stated he would like to know the source of CDBG money that we’re going to spend if next year’s grant or what’s left of this year’s grant, or combination or money coming in from rental. He stated if we only get $560,000 annual CDBG funds, then have lot of non-profits asking where funds are and those people have an interest in this debate. He stated $560,000 CDBG money 2002 and assuming $450,000 of monies paid by people who got CDBG loans, and if do what suggesting here is take $300,000 of that money and short $250,000. Mr.
Hanson stated the $250,000 is coming in or has been collected as program income under the old rental rehab program but hasn’t been included with the CDBG Program previously because it’s a program of itself, and after get some repayment and make the program worthwhile, to announce another program and administer it. Council Member Christensen stated there are other issues they need to discuss before approving this program.

Council Member Klave stated some of these are on-going programs and are good programs, but has concern that we’re going to limit it to strictly city-owned property, need to be fair to other developers that if they want to build homes, that they can at $130,000 and program is there that we don’t take them out of the picture so they can’t move their own property.

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The city auditor pointed out the normal argument on tax abatements, that the 2002 year budget and choices council will have to make in 2003, and when give up any taxes right now, decisions going to become tougher.

2.4 2001 CDBG Program.
Mr. Hanson stated when the 2001 CDBG budget was approved, it was approved with the primary awards of the grant, then had a secondary tier if funding became available, and would move down that list of projects. He stated they were here to ask the council to allow them to side-step on the second tier (back page of staff report) and not fund the second, third and fourth projects in that list (Listen, Red River Valley Habitat for Humanity and Café Kosmos) and move onto the Firehall Theatre; Listen Center has completed a landscaping project utilizing funds received in 2000 and unable to get another project started and will be applying in 2002; Red River Valley Habitat for Humanity as they had trouble spending the 2000 funds allocated; and Café Kosmos, business has been closed for approx. 2 months; and then to the North Valley Arts Council. Council Member Bjerke asked if Red River Valley Habitat let us know their opinion of being side-stepped; asked how Fire Hall Theatre and North Valley Arts Center become projects - Mr. Hanson stated those two projects are not LMI projects, 70% of CDBG funds have to be spent for the benefit of LMI; have had store-front program which is eligible under the slum and blight category, and that’s what these two projects eligible under.

There was some discussion as to similar organizations combining into one building and sharing expenses, and it was also noted that they need to sit down and discuss this with those organizations.

2.6 Request from Continental Homes, Inc. learning center.
Mr. Terry reported difference in bids was an under estimate of what they thought it would cost in-house.

2.7 Request from Shelter for Homeless, Inc. (Northlands Rescue Mission).
Council Member Gershman stated there is an obvious need in our community for additional support for many of these non-profit agencies, that many of these groups need to sit down and begin talking to each other - all do wonderful work but asked how many of them shared offices, clerical, reception; none did as all independent and maybe time to bring those people together to see how start work together to lower their costs - maybe through United Way sit down and get these organizations together and how start to share some of the services and lower their costs and overhead.

2.8 Amendment No. 1 to engineering services agreement with Widseth, Smith, Nolting for Project
No. 4974 - 17th Avenue Bikeway.____________________________________________________
This item removed from the agenda.

2.9 Consideration of Change Order #5, City Project #5200 - 2001 Flood Preparation.
There were no comments.

2.10 Update on House Foundation Demolition status.
Council Member Christensen noted that a report was submitted with no recommended solutions, and asked how many foundations left to remove between now and freeze up; Mark Walker, project engineer, reported there will be about 7, 3 under Corps’ demolition contract with houses still on the lots and those should be moved before freeze-up with contractor to go in and demolish those foundations; 4 foundations not under the Corps’ contract that will need to be demolished, and
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have asked the Corps to include those under their contract to have their con-tractor demolish. He stated they’ve talked with the Corps about including those types of provision in their next contract to include a two-week opportunity for the contractor to demolish the foundations after the house is removed; and have expressed their concerns to the Corps and contractor and will do best to demolish foundation in a timely manner. Mr. Grasser stated they have a list of structures to be included in future Corps demolition contracts, 43 homes, some will be coming out probably over the course of the winter and have talked to the Corps that in those events they would backfill the foundations during the winter months and re-excavate and re-compact them in the summertime; that the home removal process will be ongoing but are making sure that the open hole and foundation not sitting there over the winter months.

2.11 Public Transportation Committee extension.
There were no comments.

ADMINISTRATIVE COORDINATOR COMMENTS

There were no comments.

MAYOR AND COUNCIL MEMBER COMMENTS

1) Council Member Glassheim reported the next to last meeting of task force on youth will be Thursday night at the Rural Technology Center on UND campus, and working on recommenda-tions; final meeting a week from then finalizing recommendations.

2) Council Member Gershman reported that tonight we had three complicated issues and if not time sensitive should have some separation between them; and presented matter of coordinating meetings - that tomorrow night there are two meetings that he needs to be at and has to make a choice, but need to schedule meetings so that they can attend - need clearing house.

3) Council Member Burke asked in regard to the letters that went out on special assessments for the dike, whether or not the amount for the dike assessments includes assessments charged to other taxiing entities or would they pay that out of their normal taxing authority or have the ability to special assess back for that. The city auditor reported those entities would have to do it through their normal taxing authority.

4) Council Member Hamerlik stated he talked to several people concerned about their special assessment taxes and if there were a lot of errors in the assessment when they went out and had to be corrected. The city auditor stated there were some errors and they are being worked on and
corrected - out of 14,000 assessments aware of about 15; calculations are based on sq. footage of lots.

5) Council Member Bjerke reported that the County spending is going up 9.1% for next year.

6) Council Member Brooks stated that Mr. Bjerke’s statement re. adding items and voting on
them, not controversial ones, but point was still well taken - that we can’t be doing that as have set the rules and need to stay with that. Council Member Klave stated that when discussed was time sensitive issue, that we’re coming into the time of the season when could be coming into time sensitive issues and that staff can try to make sure we know those are special action items. Council Member Hamerlik stated that if we know ahead of time that we’re going to have a council meeting,
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that be placed at top of agenda so everybody given notice.

7) Council Member Brooks stated that yesterday was the end of time of mourning and flags were put back to full staff, and some people seemed to interpret that as taking the flags down, lets keep the flags still flying - the issue is still before us and important. Mayor Brown noted that fire stations are allowed to keep their flags at half staff until October 11.

8) Mayor Brown stated that September 18 it was sad to say goodbye to Col. Gray and his wife, Jackie, during the change of command ceremony, but welcome Col. Sable and his wife, Carol, to our community; the Grand Forks Symphony benefit Saturday, September 22, was well attended and thanked the community for that; and East Grand Forks Memorial Service on Sunday, September 23, was well attended and thanked the community for that.

ADJOURN

It was moved by Council Member Kreun and seconded by Council Member Klave that we adjourn. Carried 11 votes affirmative.

Respectfully submitted,



John M. Schmisek
City Auditor