City of Grand Forks, North Dakota

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PROCEEDINGS OF THE CITY COUNCIL
OF THE CITY OF GRAND FORKS, NORTH DAKOTA
September 27, 1999

The city council of the city of Grand Forks, North Dakota met in special session in the council chambers in City Hall on Monday, September 27, 1999 at the hour of 7:00 o’clock p.m. with Mayor Owens presiding, pursuant to call by Mayor Owens, which was served on all members on September 27, 1999: Document No. 7886 - Notice.

Present at roll call were Council Members Brooks, Lucke, Hamerlik, Bouley, Glassheim, Carpenter, Beyer, Babinchak, Bakken, Hafner, Martinson - 11; absent: Council Members Polovitz - 1.

Mayor Owens announced that anyone wishing to speak to any item may do so by being recognized prior to a vote being taken on the matter.

COUNCIL MEMBER KLAVE REPORTED PRESENT
COUNCIL MEMBER LUNAK REPORTED PRESENT

APPROVE COST MATRIX

Mayor Owens reported that she had distributed copies of a recommended cost matrix to the members of the city council.

Council Member Carpenter moved approval of the Mayor’s recommended funding plan. The motion was seconded by Council Member Hafner.

Council Member Carpenter stated that the plan that the Mayor has laid out is a good plan, however, there is one item that he would like addressed and moved an amendment to the budget. He stated that there is a proposed 2 mill increase that the Park District has and part of that mill increase relates to potential special assessments and part of their budget and problem they have for their 2 mills is because of flood related expenses to the Lincoln golf course and to Waterworld, and that since we have these dollars available for projects within the community and one of our objectives is to try to keep the tax burden down to our citizens, he moved an amendment to the motion which would add a line item under the immediate column of $225,000 for the Park District and with the corresponding other side of the amendment to reduce the first priority under the water system improvements by $225,000, reducing that to $1,525,000. Council Member Glassheim seconded the amendment.

Council Member Carpenter encouraged the council to support the amendment as we have provided assistance to the School District to help them purchase houses next to Phoenix School to provide green space for the students, and that this would be appropriate to try to help keep down the tax burden to our citizens.

John Staley, Park District, stated that if this amendment passed they would lower their mill levy by 2 mills and use these dollars to pay the next year’s installment on the specials levied against the Park District for streets, water, etc. and wouldn’t have to raise those 2 mills.

Council Member Lucke stated that a mill is about $76,000 and 2 mills would be $152,000, and questioned by giving 3 mills for 2 mills of tax relief.
Council Member Carpenter stated that the intent is that this gives them additional dollars to carry over to
2001 so they won’t have to raise their mill levy at that point in time and use the carryover of these funds
to meet the obligations of 2001.

Mr. Staley stated that they have several funds, have park operating fund, forestry operating fund, recreation operating fund, capital and betterment, etc. and on all of those funds have held the lines and those are funds they totally control and have held taxes, increased fees somewhat and in all those areas taken losses that they didn’t get federal dollars to repay. He stated that the $225,000 will be escrowed and will be to pay off the special assessments for the projects assessed against them or the projects they have no control over, and that they probably won’t use the entire $225,000 this next year but what’s left will be escrowed until they get into 2001 to do the same thing so not have to raise taxes.

Council Member Hafner stated that the Park District is a part of Grand Forks and benefits the citizens like any other program we have in the city and that they have suffered just as much damage.

Upon call for the question on the amendment and upon voice vote, the motion carried 11 votes affirmative, with Council Members Lucke and Lunak voting against the motion.

Council Member Hamerlik stated that at their committee of the whole meeting on September 20, the committee moved to include the Business Assistance Program on the recommended matrix and moved that the Business Assistance Program now listed under Over Allocation at $875,000 be placed at the top of the first priority. Council Member Brooks seconded the motion.

Terry Hanson, Urban Development, reported that the categories first priority and second priority within each category items are not ranked and first listed is not first funded; that they do know today with the action that they took at the last city council meeting that there's $5,926,000 in CDBG funds available in contingency line item, and that’s what funds the first column; the first priority column is made up of funds that are coming available through Phase IV, the restructuring of the Phase IV buyouts and other buyouts that are going to be purchased with City funds rather than with CDBG funds, and included in that is the Lincoln golf course buyout, which is now the intention of the council to buy that with City funds rather than with CDBG funds and that would give them $5.1 million. He stated that the second priority is FEMA dollars that have not as yet been applied for but it is felt that there are projects and purchases made on the east side of the dike that if applied for the expenditures thereto qualify for approx. $6.2 million in FEMA funds, but there are two questions, do we have the properties and will we get it applied for and approved. He stated that the second priority funds may not be available for 2 -3 or 4 months. Mr. Hansen stated the $6.2 million are available but have to be applied for and once applied for they have to determine there are properties that can come up to approx. $7.3 million that can be applied toward those funds, and engineering department has been researching that and are quite confident that the properties are there. Mr. Hansen stated that the second priority $6.2 are the only FEMA dollars that he is aware of.

Council Member Martinson questioned where the funds came from as he thought all of the CDBG funds had been allocated. Mr. Hansen stated that the $16.7 million in funds came from - about $4 to $5 million as a result at the end of June and through July we did discontinue a lot of programs that were finalized and we were more assured of how much funds were available from these programs. He stated they did not know how many dollars are going to be made available through the issuance of a bond to reimburse the CDBG funds for the expenditures made on properties that are necessary for the match for the dike project with the Corps. He stated they have become more confident that we’ll be able to come up with $2 or $3 million out of that process, that they did have approx. $11 million budgeted in Phase IV for buyouts and that phase is now around the $20 million mark and the properties eligible for match within the dike line are going to provide approx. $13 to $14 million in city bond funds that will be used to reimburse the CDBG expenditures, freeing up $3 or $4 million and that is added to the $4 to $5 million and get the $7 - 8 million. He stated that the biggest portion of the last of that is the $6.2 million in FEMA funds and we had not anticipated that those funds would be available until just recently.

Mr. Vein stated that Mr. Hanson had talked about some of the funding sources, specifically the second priority of the $6.2 million noting those are some anticipated FEMA funds - that there are two different FEMA funding sources we’ve talked about - the $2.5 million fund and a $3.7 million, that we’re very confident about the $2.5 million but the $3.7 have less confidence in and have had some discussion with FEMA as late as this afternoon trying to find out and assure that we get that $3.7, and that is not certain, and think we have to do some more discussions on that and when you look at the second priority of the $6.2 there’s a possibility that $3.7 of that isn’t available for us. He stated they may not have as much money available but have listed that under the second priority, noting that it’s only if monies are available are we going be able to do those.

The city auditor stated that the concern they have is that they know and are fairly certain that immediate and first priority funding and that money will be expended, however, what you have done is taken $875,000 from the over-allocation and moved it to the first priority and that means we don’t have full expenditure and within the immediate and first priority those are not in priority sequence and if move $875,000 into first priority, would like council’s direction on what to reduce from that priority.

It was moved by Council Member Lucke to amend the motion to move the $875,000 into the first priority column and take it out of water system improvements. Council Member Brooks seconded the motion.

Upon call for the question and upon roll call, the following voted “aye”: Council Members Lucke, Hamerlik, Lunak, Klave, Hafner, Martinson, Brooks; voting “nay”: Council Members Bouley, Glassheim, Carpenter, Beyer, Babinchak, Bakken - 6. Mayor Owens declared the motion carried to move funding over into first priority.

Council Member Glassheim asked what the water system improvements going back on water bills, with $875,000 less to pay for it. Mr. Vein stated that on one of the matrix they have about $16 million in estimated water projects, and have put about $10 million of those improvements to be added and potentially funded by CDBG, any part of that that is not funded by CDBG would have to be funded through the water utility itself (future water rates) and some may be able to do with cash reserves that we have now and other parts paid through bond sales that would be paid back through the rate structure.

Council Member Klave asked how the Business Assistance Program was going to work and if there were any guidelines on how it will be done. Council Member Hamerlik stated that the plan and proposed in amendment to pass was that it be basically the same program that we had originally allotted $2 million to of which $250,000 was taken out for employment so came to $1.75 million and in that program some 60 firms were funded, several turned down, some at the end were given minimal amounts on the appeal, $15,000 for several of them, and in the motion at that time it would be the same program, no new applicat9ons, and there was a statement made that if they had any other extenuating circumstances that weren’t able to submit originally that they could be possibly acted on and removed the $100,000 maximum from that other program that we had, so not a new program but an extension of the program where there wasn’t enough money. Council Member Klave asked if firms applied, made an initial application and didn’t do any follow up, are they still part of this program or dropped out of that system. Council Member Hamerlik stated that anybody that had applied would be eligible for consideration.

It was moved by Council Member Babinchak to amend the amendment to move the $875,000 Business Assistance Program into a second priority instead of the first priority. Council Member Glassheim seconded the motion.

Upon call for the question and upon roll call vote the following voted “aye”: Council Member Glassheim, Klave, Beyer, Babinchak, Bakken, Hafner - 6; voting “nay”: Council Members Lucke, Hamerlik, Bouley, Carpenter, Lunak, Martinson, Brooks - 7. Mayor Owens declared the amendment defeated.

Upon call for the question on the original amendment, as amended, to move funding to the top of the first priority column and upon roll call vote, the following voted “aye”: Council Members Hamerlik, Lunak, Klave, Hafner, Martinson, Brooks, Lucke - 7; voting “nay”: Council Members Bouley, Glassheim, Carpenter, Beyer, Babinchak, Bakken - 6. Mayor Owens declared the motion carried.

Council Member Hafner moved an amendment to change the allocation in the Industrial Park Lift Station to $330,000, that project was bid today and in order for this project to proceed it would be difficult to create a special assessment district or find some other funding source. Council Member Lucke seconded the motion.

Mr. Grasser, asst. city engineer, suggested that the additional $55,000 come from projects 6901 which is in the current cost matrix infrastructure items to be determined, and there would be sufficient funds there to cover that and wouldn’t have to subtract anything off this matrix. Council Member Hafner changed his amendment to move it from the current allocation, Council Member Lucke agreed.

COUNCIL MEMBER LUNAK EXCUSED

Upon call for the question and upon voice vote, the motion carried 12 votes affirmative.

Council Member Hamerlik stated that one of the concerns that he hears more than ever before is our streets and we have out of the $700,000 Street Repair Overlay in the first priority which is great, but questioned why the other $300,000 that it’s going to take was put in over allocation. Mr. Vein stated it was a position of trade-offs, and ended up compromising as they went through the matrix; that there is about $1.2 million in the existing matrix for street repairs plus $400,000 and put it in the over allocation, that in balancing the over all needs they took a reduction.

Mr. Vein stated that what their preliminary plans are and using the existing street overlay monies plus the proposed, that they will go to a lot of the low and moderate income areas and other areas that are older parts of town and can do a number of overlays in the Riverside Park area, the north end, north of downtown and the south of the downtown area to possibly 8th Avenue South and area north of University Avenue, west of Columbia Roads, and those would get planned overlays, and rest would go to the classified street systems and start getting in on a number of those and doing improvements on those - the 24th Avenue South, extensions of Cherry Street, North 20th Street, some of those they would come back in and try to do some improvements so will get some of the major older areas in and then go on and try to get classified streets systems which help more than just the neighborhoods, they basically help the city, and that is their current plan.

COUNCIL MEMBER LUNAK REPORTED BACK

Council Member Brooks questioned why funding for the Corporate Center ramp. The city auditor stated that the Corporate Center ramp services the entire downtown area. He stated they put in $1.2 million of CDBG funds into that, the original thought was that the parking lots that were going to be taken by the levee system would be purchased in the amount of approx. $1.5 million from the Parking Authority, and they could turn all that money into the ramp, and the remainder of that project, $1.4 million, is being assessed into a special assessment district in the downtown that runs all the way from Kittson over to 2nd Avenue North, from the River to Civic Auditorium, and that affects a lot of small businesses that are in that area and this will have a significant impact. He stated that the City of Grand Forks owns those properties and they are in our name so we can’t purchase them so therefore have come back and asked for a $1.2 million to off-set what we thought would be the purchase price of those lots.

Council Member Martinson questioned funding of $1.2 million for GIS and whether this could be done
by staff. Mr. Vein stated their staff is so overloaded with existing projects that they are just trying to keep up with and impossible for staff to be able to do the work that is being asked of here. Mr. Vein stated that benefit of this is multi-faceted, there’s a lot of different things that would be included; that they have a CAD mapping system and this would bring it to a geographic information status which would make it more of a smart system and with all the improvements and modifications that they’ve made to the infrastructure system, none of that is in their existing mapping system, and doesn’t know how to keep our systems current and updated if they didn’t have this mechanism of bringing it in. He stated it also gives them the capabilities of taking the work that the Corps of Engineers has done, the mapping they have done to get that in on our system and if we ever have future flooding this would be an exceptionally valuable tool for us to look at where the water is going to be, how high it’s going to be, how it will connect with the different storm sewer systems, sanitary sewer systems, impact the English Coulee, etc. something they had no clue of how to handle in 1997. He stated this is a contract and that they have not started that contract yet.

Council Member Brooks raised questions on whether some things are flood-related or not before they vote on this - the outdoor siren system and fire truck.

Council Member Beyer stated that the siren system, because of the neighborhoods that have lost, the siren system isn’t functional and way growing to the south and west because of the flood and need to move some sirens into those areas. It was noted this is short fall to fix the system.

Chief O’Neill stated that the fire truck would be replacing a 1975 85 ft. aerial that they have in place now, since the flood there’s been a great deal of construction going on, the revitalization of downtown, the Corporate Center, County Office Building, and that he and his staff were very uncomfortable with the equipment they have to protect those new buildings that have been constructed since the flood as a direct result of the loss downtown. He stated they have a great deal of construction in the Industrial Park and aerials are not always meant to be used for height but also meant to be used over the top of a building into the interior of the building to fight a fire, open up the roof, etc. He stated its also a noted allowable exception to necessarily just be flood-damages under CDBG funds that can be used for - that it’s a truck that may or may not purchase with these funds tonight but they will be asking for this truck, that it is on the CIP in 2002.

Mayor Owens asked Mr. O’Leary to explain flood related and flood recovery and how that applies.

Mr. O’Leary reported that in the early meetings they had with HUD senior staff, that flood recovery is repair of houses, businesses, economic development, repair of infrastructure and it was also made clear to them that a number of issues that they were also concerned about, temporary levees, economic development were also part of that, and that is why they gave us a lot of the waivers that they did; that normally under CDBG money you cannot buy things like fire trucks, expansions to police department, and whether or not the council chooses to proceed with that project or not, it was made an eligible activity by HUD because they wanted to give us the flexibility on the local level to determine what flood recovery was all about. He stated that economic development is probably best case in point, we used some CDBG money along with EDA money to build the Noah’s Ark building in the Industrial Park, that at the time of the flood we were told we would lose 15% or more of our population, that a lot of people would come to help us rebuild, that there would be labor shortages initially but after the recovery period got into full swing and started to scale back, we would see surpluses of labor later in certain trades, and if we could use CDBG money to create economic development opportunities to switch those people from construction to long term employment, the rationale was that one way to recover from the flood is to stabilize our population by trying to hang on to some of the construction activities that were going on in the community. He stated that the definition of flood recovery is a broad one and it’s really their call.

Council Member Lucke moved a motion to move $1.1 million from the contribution to JDA line item under second priority to Water System Improvements which will then restore what Council Member Carpenter’s motion and Council Member Hamerlik’s motion took from that line item earlier so that we can provide some water system improvements. Council Member Lunak seconded the motion.

Upon call for the question and upon roll call vote, the following voted “aye”: Council Members Lunak, Klave, Martinson, Brooks, Lucke, Hamerlik - 6; voting “nay”: Council Members Bouley, Glassheim, Carpenter, Beyer, Babinchak, Bakken, Hafner -7. Mayor Owens declared the motion defeated.

Council Member Hamerlik moved that we switch the $300,000 in Street Overlay over allocation and switch it with public service on first priority. The motion died for lack of a second.

Upon call for the question on the motion, as amended, and upon voice vote, the motion carried 13 votes affirmative.

ADJOURN

It was moved by Council Member Hamerlik and seconded by Council Member Hafner that we do now adjourn. Carried 13 votes affirmative.

Respectfully submitted,

John M. Schmisek
City Auditor

Approved:
_________________________________
Patricia A. Owens, Mayor