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Minutes/Committee of the Whole
Monday, September 26, 2005 - 7:00 p.m.

The city council met as the Committee of the Whole on Monday, September 26, 2005 at 7:00 p.m. in the council chambers in City Hall with Mayor Brown presiding. Present at roll call were Council Members Hamerlik, Gershman, Christensen, Kerian, Kreun - 5; absent: Council Members Brooks, Glassheim - 2.

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.

Mayor Brown commented on various events held during the past week and upcoming events:
Congratulations to CVIC on their 25th anniversary last week, we are better community for the types of program and services that are provided, that CVIC has provided direct services to over 29,000 people since it started in 1980 and education and training to over 50,000 people, and efforts towards violence-free community have made a significant impact.
That he attended the 100th birthday celebration at UND School of Medicine serving UND, our community and the entire nation with medical personnel, and UND School of Medicine is feather in our hats, congratulations to faculty, staff and everyone over the years who have advanced the program.
Thanks and congratulations to the Alerus Center for great show last night, Keith Urban concert.
Reminder that tomorrow is Mardi Gras Rally for Relief at the Alerus Center from 4:00 to 11:00 p.m., thanks to media outlets, organizations for leadership for this cause, with free will offerings and spaghetti dinner and other food from around the community, entertainment for kids to adults and is place where everyone should be tomorrow evening, point is to raise funds for Hurricane Katrina relief.

CONCUR IN RESOLUTION OF SUPPORT FOR HURRICANE VICTIMS

Mayor Brown stated there have been ongoing discussions about the possibility of adopting a community and providing direct link between our departments, our churches, schools and people in order to help them proceed with recovery, that the Mayor's Office has received phone calls from various church groups and organizations who are looking to us adopting a city so they can direct their efforts to that community as well. He called on President Gershman for an update on the resolution and any other related matters.

President Gershman stated that those who saw the ABC report last night on television about Grand Forks and the hope that it is giving to the gulf region of the United States was quite compelling, very positive, that Mayor represented us very well as did Kim Holmes, George Widman and family that has their family here, and it told him that what we are considering doing of adopting a city and sharing our expertise with another city and owe that back to America for what they did for us.

It was noted that last week it was suggested that a resolution be written with a week for suggestions from council members' input; President Gershman read the proposed resolution of support for their consideration. He noted that the Mayor was in Washington, D.C. last week and met with Congressman Pomeroy and Congressman Gene Taylor from that district, and in discussion where most hurt was, the city of Biloxi was mentioned and that there are similarities between our cities.

The council members reviewed the resolution and made several changes to the resolution.

Council Member Hamerlik asked if they should have passage by consensus tonight and put it on the agenda but move forward with it, that the idea to have East Grand Forks join us is fine but if we wait can slow down and be week or more and suggested that the Mayor ask for consensus for the City of Biloxi and this resolution to see if consensus to go with that. Mayor Brown asked for consensus and the council agreed for the two things mentioned.

Mayor Brown asked for motion with unanimous approval to add this to the agenda item tonight for discussion, and then do the preliminary vote and moving it forward for the next council meeting. Council Member Hamerlik stated they have the consensus already and doesn't need to put it on the agenda. Mr. Warcup stated items discussed at the committee meeting should be on the agenda, the Grand Forks City Code does require unanimous approval to add something to the agenda and recommends that it be added to the agenda, discussed and decided upon.

It was moved by Council Member Gershman and seconded by Council Member Kerian to add this item to the agenda. Carried 5 votes affirmative. Mayor Brown stated it is now on the agenda and preliminary approval moving forward. (Resolution attached)

It was noted that the resolution was amended, and that the word churches was added after non-profits on the second to the last Whereas and on fourth paragraph .

Council Member Kerian stated his idea was to have East Grand Forks join us in this, but not wait for them to do that, and if Mayor gets chance to visit with them tomorrow and ask them to join us in this resolution if they wish. Mayor Brown asked Mr. Haga to contact Mayor Stauss' office tomorrow morning as they have a council meeting on Tuesdays and nice if they could act on this as well; and stated they were going to have the resolution printed in big wall poster and post it at the Rally for Relief Mardi Gras.

2.1 Request from UND Entrepreneurship Internship Program.
Keith Lund, Urban Development, reported that in August, 2005 the College of Business and Public Administration presented a request to the Growth Fund Committee for support of the entrepreneurship internship program, that the City previously funded the program to match the Kaufman Foundation funds, however, UND has been notified that the Kaufman Foundation will not be able to support the program. The Growth Fund Committee meeting on September 8 heard a presentation from Dr. Moser, Associate Dean, and while the Growth Fund Committee spoke in support of the program, they felt it did not meet the newly revised and adopted policies and procedures which state the goals of the Growth Fund to provide economic support to businesses that create higher paying jobs, save existing jobs, create new wealth, enhance local property tax base, encourage capital investment or diversify the local economy. The Growth Fund chose not to fund the request but did forward the request to the city council and asked that they fund it out of Fund 2163, the City's economic development fund.

Dr. Moser stated they appreciate the 3 years of support they have had in the past , that they placed many interns using that funding and last year did 14 interns and would not have been able to have that many without the support of the City. He stated he collected some information after meeting with the Growth Fund, as it was suggested that more information would be valuable, reactions of people that hosted the interns and included in the packet is information from those two surveys, one from internship providers and had 14 respondents there, and they are favorably inclined towards the program. He provided summary for the interns themselves indicated a lot of favorable responses and also suggested that generally increased people's interest in entrepreneurship and have 5 of these who have gone out to start their own businesses and projected there are about 18 of these students still in Grand Forks after their internship and 3 are present at tonight's meeting. He stated they have had a lot of success and thinks this does mean economic development, and feel they could come up with a lot of examples to illustrate how important this program has been. He stated they were rated #14 in the nation in entrepreneurship by Princeton Review. He stated this is not a program that is meant to give people interns, the intern providers both have to come up with the cash to match the funds that we get from other sources as well as they have to put in considerable amount of time to make these folks successful in their business, that it is a good program and program that makes a difference in Grand Forks and would like to see them be able to continue it.

Council Member Hamerlik stated he noted a letter from the President and asked why didn't the University fund it. Dr. Moser stated they have tried over time to get as much support as they can from the President's Office, have gone to him with many proposals to get new positions into the College and add to their operating funds but haven't had a lot of success - he stated in last 6 years up until now they have only had less than 1% increase in operating budget, but that President is a supporter of theirs but hasn't materialized in funding; that he has a lot of people asking for funding and has to prioritize them and this didn't hit the highest priority.

Council Member Gershman asked why Kaufman did not continue the funding. Dr. Moser stated the Kaufman Program disbanded itself, the leadership changed in the Kaufman Foundation and they decided they no longer were going to support a specific entrepreneurship internship program; still have a number of Kaufman programs but tend to support multi-million dollar projects and not support small projects such as this, they have tried to figure out ways of pitching a small project to them, have pitched a couple ways and were unsuccessful and not sure they are going to continue to provide them with any help in the future - but continue to try.

Council Member Gershman stated the Business School has a fund drive going on now for $25 million and have raised $17.4 million is current number they are at, and why wouldn't the Business School fund this through that. Dr. Moser stated that basically what they have funded so far is a lot of facility improvements, that has been a high priority, they have a 1968 building and have been rebuilding it room by room and he has been overseeing the projects these last couple years and part of that gift/money was for the work that was done at the Center for Innovation in terms of their new building, that a lot of money went into facilities, second part where money dedicated was to hire their entrepreneurship chair, preference in what trying to sell is facilities.

Council Member Gershman stated he thinks there are internships at the University that are non-paid, that he has an issue with the City of Grand Forks tax money being spent for internships in retail businesses, that one shows that the business pays $6.66 hourly rate and problem with using City's tax money to subsidize businesses on payroll because if these are as good students as he believes they are, then businesses should pay more to have them, that he thinks the Business School is doing wonderful job but when handling City tax money, not best way to spend it.

Council Member Gershman suggested that as part of the capital campaign that you start a part of that as an entrepreneurship program and those same businesses contribute to that. Dr. Moser stated that was something he suggested to their development officer as something he would like to look at because they have had a number of businesses involved with this and thought they might be willing to help us out, however, that hasn't developed to this point and looking at priorities the most important priority is to hit the $20 million mark and they have a lot of big prospects they are looking at and some substantial gifts, and the trouble with this program is that it is small, relative to a lot of others and hard to get up the priority list. Council Member Gershman stated he was talking about these businesses themselves that have benefited, know they are contributing something but perhaps could contribute more and have their own scholarship fund.

Council Member Kreun stated in the last 5 years 55 businesses have participated in this; and if took those businesses and if each gave $372.00 would have your $15,000 and to sustain the fund so you wouldn't have to come back looking for funds every year or every other year, and wouldn't it make more sense to work with those particular businesses and try to set up a revolving fund. . Dr. Moser stated there were 55 businesses that have had interns and find quite a number that could scarcely afford to have the intern let alone trying to support it later, and since want to have those blooming businesses get on board, but dealing with much smaller number of folks that would really be in a position to contribute.

Council Member Christensen stated the issue is an entrepreneurship program, that you have a list of businesses that have availed themselves of this program and these businesses chose to hire some of the talent, that there are a lot of good programs and worthwhile individuals seeking to keep their programs going but concerned if this council and future councils become secondary source of funding programs at the University of ND which aren't being funded currently and haven't met funding criteria of the University of ND, we will become a secondary source of funding for UND for programs that have internships, this is one where there is a funding source to augment the salaries that the businesses that select the interns would pay, that you can say that it is economic development. He stated you have $17.5 of a $20 million project but could carve out $25,000 out of that for the next year or two until get this running, that this would be a good project for the entrepreneur group to fund this and endow it for the next 3 to 5 years - and questioned if this shouldn't be to go back to the EDC and if this should be a function of the EDC and to work with you to engage in the development of business and young business entrepreneurs.

Council Member Christensen stated the EDC has a mission and the growth Fund went through complete revision of policies and procedures, those are the rules they have come up with and try to follow when view applications to pass out monies that are available for business, that business needs talented individuals and lay challenge to the EDC and challenge Board of Directors and executive committee to review this program to see if there is some way that they can incorporate it or assist it going forward in this community so they can raise money in an entrepreneurial vein to fund ongoing existence as the rest of the businesses did when they went out and borrowed money, etc. and have an EDC that has a list of individuals highly placed in this community and with their help can get this done quickly and raise your $25,000 and encourage you to do.

Council Member Gershman stated that EDC doesn't have enough staff to do that and put caution that it does not fit the mission of the EDC and that is why the executive committee did not put it forward and went to Growth Fund where it didn't fit their criteria either; and that EDC staff is working hard with number of projects and don't have the time for staff to develop this as was suggested.

Dr. Moser stated his request would be if there were some way to have them be able to grow this fund that they might gather from people that could support them and wean them off of this and would be favorably inclined to do that and if can see way clear to offer them some funding that would be reduced as they basically got the other funding in place and would be in favor of that.

2.2 Streamlined sales tax required City Code changes.
This item was pulled and returned to staff.

2.3 Bids for Project No. 5817 and 5841, Lift Station No. 16, Upgrade and Lift Station
No. 22 ventilation.______________________________________________________
There were no comments.

2.4 Amendment No. 1 to Engineering Services agreement with Webster, Foster & Weston for Project No. 5817, Upgrade Lift Station No. 16 and Project No. 5841, Lift Station No. 22 ventilation._________________________________________________
There were no comments.

2.5 Budget amendment, fire department.
There were no comments.

2.6 Sanitation Department compost turner bid.
There were no comments.

2.7 2006 Community Development Block Grant Program.
Keith Lund, Urban Development, reported that the staff report asked them to approve a preliminary budget for the 2006 CDBG and HOME Program, and the budget included in the staff report contained a budget developed by the Finance/Development Committee at their September 13 meeting, and as part of that recommendation, there is a set aside for $261,400 for Hurricane Katrina relief and the intent was to allocate CDBG funds directly to a gulf coast community to help them assist in flood recovery efforts. He stated staff made contact with HUD to clarify the existing regulations with respect to this project to determine its eligibility; that they have been provided that clarification is that local CDBG funds may not be reallocated to a gulf coast community to assist with flood recovery, and because of this information staff has taken the liberty of preparing a revised budget for council's consideration and was placed on their desks prior to the meeting this evening, and in summary the budget removed the amount set aside for Katrina relief, and increased Red River Valley Community Action Agency, Housing Rehab Program budget from $300,000 to $400,000, immediately funds the Easter Seals project in the amount of $60,000, immediately funds the Gateway Drive project in the amount of $75,000 and places a set aside of $26,430 for Contingencies, primarily to address potential cuts in CDBG Entitlement funding that HUD may deem necessary as a result of directing substantial amounts of dollars to the Katrina relief effort directly from Washington.,

Council Member Hamerlik stated that the revisions sounded like the original recommendations
that were made by staff. Mr. Lund stated that was correct.

Council Member Christensen reported that his suggestion of giving monies to affected communities and only revenue he thought might be available to expend to assist the communities is the CDBG funds that we received that were continually coming back from those who borrowed the money from the City and are repaying it; that he never intended that any monies would come from sales tax dollars or general fund revenue. He stated that at a meeting when they discussed the possibility of City contributions; they don't know all the rules or laws that govern the actions and it was suggested that this issue of utilization of CDBG money might have some merit but should be reviewed to see what the rules and regulations are, and staff was asked to look into this, and report received from staff, idea explored and legality addressed. and done with it.

Council Member Gershman suggested that we start checking with various foundations that might
be interested in providing the City of Grand Forks with some funds to allow us to travel, etc. that
has to take place so that we do not use city funds and would request that we start looking into
that, many foundations that we can write to and some have vested interest in the gulf region,
Knight Foundation is one, and thinks that's where we should go with this.

Council Member Kreun thanked committee that was nominated, to take the time and put process together and recommendation in front of us, some good agencies are working very hard for Grand Forks and doing a good job, have Prairie Harvest, Red River Valley Habitat for Humanity, Senior Citizens Center, Red River Valley Community Action, Easter Seals, etc. and all agencies have been very good to Grand Forks and we appreciate what they do for us.

Council Member Kerian questioned public service portion, United Way Grand Forks/East Grand
Forks administer public service projects. Mr. Lund stated the $200,000 that is suggested to be
allocated to United Way, they will take 15% of that for administration of the program, and balance will be directly allocated to service organizations that provide programs that benefit low and moderate income individuals.

Council Member Kerian asked if any of this returned in any way, whether loans or grants, etc. Mr. Lund stated that Red River Valley Housing Rehabilitation Loan Program is a loan program, $400,000 and 15% of that the Red River Valley Community Action Agency will use for administration of the program, 10% set aside for emergency repair programs and grants, and balance of the funding will be made available to low and moderate income residents as a low interest loan program, and it was an opinion of the Finance/ Development Committee and other members of the council that they recognized that these dollars come back to the City due to repayment of loans and sale of property and if we continue to dole out these funds and grants that those days will soon be over and are trying to implement programs that will have a payback into the future and this is beginning stages of that effort.

Mr. Lund stated they were impressed with the diligence of the members that were nominated to this committee, they looked at the regulations and intent of the program and voted their conscious did an excellent job and commended them on selection of committee members.

CITIZEN REQUEST

4.1 Comments by Jerry Hjelden re. preliminary resolution of support for a casino in
Grand Forks.__________________________________________________________
Mr. Hjelden, 1508 South 14th Street, #5, stated he understands the proponents of a
casino, they are afraid of federal legislation that would prevent them from locating here and if the
federal government is looking at making this illegal, expansion of casino gambling and the State
House of ND voted down a bill to expand casino gambling by margin of around 96 to 2 and asked
why council is even considering a preliminary resolution of support; the State and federal
governments must have some information to base their actions on and why aren't we looking at
the consequences of bringing a casino to Grand Forks. He stated he had left two economic
reports - and that for every $1.00 in revenue that is brought in by the casino, $3.00 goes out;
businesses tend not to locate in areas with legalized gambling, and in order for a casino to be a
benefit to an area of 100,000 people they would have to bring in over 11,000 jobs; that
economists in Nebraska agreed that negatives far outweigh the positives, and asked council to
please review again the reports he left with the council.

Council Member Christensen stated that the council had a presentation by a group that feels there could be some benefit for the citizens of city of Grand Forks, county of Grand Forks, East Grand Forks and some benefits for their community; and have been asked to explore this; that he respects your information and will look at that; but that they don't have the information yet to make an informed decision,

MAYOR AND COUNCIL COMMENTS

1) Council Member Kreun stated that with all storms happening our military is taking a backseat
but are still fighting a war and lot of military people in harm's way and should remember that and
thank each and every one of them every time we get the opportunity.

2) Council Member Kerian stated they had discussed the Library Board and tabled an
appointment to that and asked if that is still open - Pete Haga reported that there have been a
couple of suggestions but no appointments set up for interviewing, that the School Board has
sent notification that they have rescinded their appointment and that additional names could be
received and considered. Council Member Kerian encouraged people if interested to do that, and
suggested press releases to let people know.

Council Member Christensen stated they have 2 appointments coming up for Planning & Zoning
Commission, citizens and not council members, and would encourage Mr. Haga and Info. Office
to make those openings available and to publicize those, Channel 3, and get the information out
that we are seeking interested citizens to serve on these committees, and to make an effort to
gather more names before we appoint.

Council Member Gershman suggested placing a notice in our announcement every week in the
paper, put it in a box to make sure it stands out, Council Member Hamerlik suggested calling
attention to the website and include responsibilities, etc. - and noted that they look to see how
appointments are to be made to various boards, etc.

ADJOURN

It was moved by Council Member Gershman and seconded by Council Member Hamerlik that we
adjourn. Carried 5 votes affirmative.

Respectfully submitted,



Saroj Jerath
Deputy City Auditor