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HomeMy WebLinkAbout19950221_regular202 l4INUTES OF THE =GULAR MEETING OF TBE EDIHh CITP COmrJCIL HEIS AT CITY JULL FEBRUARY 21, 1995 ROLT..CAKL Answering rollcall were Members Kelly, Maetzold, Paulus, Smith and Mayor Richards. CONSENT AGENDA ITEMS APPROVED by Member Kelly to appruve and adopt the Council Consent Agenda items as presented, with the exception of removal of Item 111. E, Riding Rotary Mower - Braemar Golf Course. Motion was made by Member Smith and was seconded Rollcall : Ayes: Kelly, Maetzold, Paulus, Smith, Richards Motion carried. DOK?ATIONS PRESENTED FOR 1995 CULTURAL EVENT Ming-Fen Ni, Cultural Event Committee Chair and Human Relations Commission Member, accepted donations from the following major sponsors of the Event: Norwest Bank by Jody Leaf, Interfaith Peacemakers by Nancy Atchison and Edina Realty by Brian Duoos. Ms. Ni expressed thanks to all sponsors on behalf of the Human Relations Commission and urged those present to bring friends and neighbors to the 1995 Cultural Event, "Everyday Heroes", to be held March 19, 1995, at Edinborough Park from noon to 4:OO P.M, Mayor Richards expressed appreciation on behalf of the City for all supporters of the Event. BECYC"G COORDIHATOR JANET CIUNDLKR HONORED UPON RETIREMENT On behalf of the City of Edina, Assistant Manager Hughes commended and thanked Janet Chandler for her dedicated service to the City both as an honorary member of the Edina Recycling Commission since its inception in 1972 and since 1986 as the first Edina Recycling Coordinator. He noted that she has been instrumental for planning and designing Edina's door-to-door recycling program. In appreciation, Assistant Manager Hughes presented a silver pen with the Edina Logo and extended best wishes for her retirement as of February 24, 1995. thanked the Council for its support, the staff for its help and all the citizens of Edina in making the Edina recycling program so successful. Coordinator Chandler *HlXUTES APPROVE3 FOR REGUTAR MEETING OF FEBRUARY 6. 1995 AND CLOSED HEl3TJXG OF FEBRUAEY 6. 1995 Kelly to approve the Minutes of the Regular Meeting of February 6, 1995, and the Closed Meeting of February 6, 1995. Motion was made by Member smith and was seconded by Member Motion carried on rollcall vote - five ayes. FINAL DEVELOPHEKC PIAN APPROVED FOR 4530 FRANCE SOUTH ~VALVOLINE WID OIL CHhNGE) Presentation bv Planner Planner Larsen recalled that the proposed redevelopment plan for the subject property, generally located west of France Avenue and south of Sunnyside Road, was considered by the Council at its meeting of February 6, 1995. The Council continued the hearing and requested further information on signage, traffic, building height and similar facilities in the metro area. The subject property is zoned PCD-4, Planned Commercial District. district signage may occupy up to 20 percent of each wall area. site with one street frontage is allowed one freestanding sign which can be up to 80 square feet in area and 20 feet tall. conform to those requirements. percent of the wall area. a sign area of 60 square feet. I In the PCD-4 In addition, a The existing signage on the site does No wall has permanent signage exceeding 19 The existing freestanding sign is eight feet tall with 2/21/95 203 Planner Larsen presented graphics illustrating the proposed signage for the new building, noting that on the north/south sides it would consist of red plastic half-barrel panels which would be lighted and therefore calculated entirely as signage. On the east elevation (France Avenue) there would only be lighted lettering. The free standing sign is proposed to be reduced in size to six by seven feet with total height of 9.5 feet. Concerning traffic, Planner Larsen explained that it would have one way flow from north to south with curb cuts in approximately the same location as today. City Engineer has inspected the existing development and reviewed the proposed redevelopment plan, and in his opinion, the proposed plan would not create a traffic safety problem. The The proposed one story building would be 14 feet in height as compared to the existing building which measures 13 feet in height. The Zoning Ordinance limits buildings in the PCD-4 district to one story, but does not place a limitation on the height of that story. ' As to signage for the subject site relative to other adjacent business uses, Planner Larsen explained that the lot immediately south (4532 France Avenue) is zoned R-1, has a non-conforming status as to use and therefore has no signage rights as it is a house that has been converted to office use. building (4536 France Avenue) was rezoned in the 1970's from R-1 to Planned Office District. this case, the Century 21 Realty office is allowed one sign per street frontage no larger than 50 square feet. The second POD district is allowed less signage than a commercial use. In Member Smith said he had walked the property at 4541 Meadow Road at night and said he was concerned about the barrel sign on the south side of the proposed building being lighted at night. Planner Larsen responded that he did not know the hours of operation for Valvoline Rapid Oil but reminded Council that approval could be conditioned upon the signage being lighted only when open for business. He noted that the home at 4541 Meadow Road is approximately 300 feet from the subject site. The homes more adversely affected by the lighted signage would be those on Sunnyside Road. Presentation for Developer John Kosmos, K.K. Design, said he believed the proposal now answers all Council concerns about signage. He pointed out that the free standing monument sign has been reduced in scale on the street side and the barrel signage would be limited to the north and south sides. A surveyor has verified that the signage would be approximately 250-275 feet away from the nearby homes. Rapid Oil has indicated it would have no problem with Code compliance that no sign facing residences shall be illuminated between 1O:OO P.M. and 7:OO A.M. or when open for business. Mr. Kosmos said Valvoline Public Comment David Anderson, 3907 Sunnyside Road, stated that he was also speaking for Jonas Sandquist, 3911 Sunnyside Road, and Bernice Lavin, 3905 Sunnyside Road. He said their concerns were mainly with the construction materials for the building and the signage. development of the area. The proposed signage will be substantial which, together with the exhaust from the vehicles, could be considered a health hazard. Mr. Anderson said he understood that the main reason for the design change was because of congestion. He mentioned that he goes there regularly and that he felt the numbers do not warrant a new design. They felt using concrete block would not be conducive to future Current signage on the north side now is on all night. 2/21/95 .. ouncil Comment/ Action Mayor Richards asked what the hours of operation would be. typically, Valvoline would open at 7:OO A.M. and close at 8:OO P.M. Mayor Richards asked if the City's ordinance would allow restricting the lighted signage to hours of operation or 7:OO A.M. to 8:OO P.M., whichever is more restrictive. Kosmos said he did not believe Valvoline would have a problem with restricting the hours for lighted signage on the north/south sides if the pylon sign could remain illuminated. Mr, Kosmos answered that, in keeping with Valvoline's corporate image, it would be break-off textured concrete block of their standard color with a decorative eight inch blue band near the top of the building. Mr. Kosmos said that, Planner Larsen responded that the ordinance would permit that. Mr. Mayor Richards also asked about exterior materials. Member Paulus inquired whether people go to Valvoline Rapid Oil because their buildings look the same in all their locations. Mr. Kosmos said he wished the building image prototype was that strong; however, that is not the case, it is their reputation that attracts customers. Further responding to Member Paulus, Mr. Kosmos said this particular store attracts customers from southwest Minneapolis and west Edina, i.e. about a 20 mile radius. Member Paulus reminded Council of the typical commercial look that Walgreen's initially proposed for their location at 49 1/2 Street, and how much better the old-fashioned brick/awning combination they finally used looks. She asked if Valvoline would consider a change in their commercial look building. Mr. Kosmos responded that, like most national accounts, they prefer to have their corporate image building repeated throughout the nation for identification purposes. Member Smith reiterated his concern for the affect of the illuminated barrel sign facing the homes on Meadow Road. sides be off from 6:OO P.M. to 7:OO A.M. Mr. Anderson interjected that, while they are opposed to the change, if the proposal is approved they would like to see the signs turned off at dusk. is consistent with the zoning for this property and that the proposed signage would comply with ordinance requirements. He suggested the signs on the north and south I Mayor Richards reminded him that the proposal Member Maetzold said he sympathized with the owners' need that signage be lit during business hours. permitted during hours of operation and to revisit.the affect in six months. Member Smith observed that their business hours may change and that any stipulation on hours that the signs can be lighted should be made at the time of approval of the proposal in consideration for the variances requested. Richards said he concurred because the proponent would rely upon the final approval as given. Member Kelly made a motion to adopt the follouing resolution approving the final development plan for Valvoline Rapid Oil including a three foot front street setback variance and a 10 foot parking setback from France Avenue, and subject to: 1) the building signage on the north and south sides being turned off from 6:OO P.M. to 7:OO A.M., and 2) the building signage on the east side and the pylon sign be lighted no later than 1O:OO P.H. or daring hours of operation, whichever is more restrictive: He suggested the proposal be approved with lighted signs Mayor RESOUPTION APPROVING FIUL DEVELOPMENT PIAH FOB VALVOLnTE RAPID OIL BE IT RESOLVED by the City Council of the City of Ed-, Minnesota, that the Final Development Plan for Valvoline Rapid Oil, 4530 France Avenue, presented at the regular meeting of the City Council of February 21, 1995, be and is hereby approved. Discussion followed on whether the building signage on the east side should also be restricted to 6:OO P.M. Motion was seconded by Member Smith. Member Maetzold said turning off the building signage 2/21/95 205 on the front would be very restrictive and that he believed the lighted pylon sign might not be enough. Mayor Richards said he would not support the motion as he felt the properties to the east should be protected from the lighted building signage as well. that a free standing sign is sufficient to advertise the business. Mr. Kosmos observed that when portions of signage are turned off it would appear that the business is closed. Further, I Member Smith offered an amendment to the motion that all building signage be turned off no later than 6:OO P.M. Ayes: Paulus, Smith, Richards Nays: Kelly, Maetzold Motion carried. Mayor Richards seconded the amending motion. Mayor Richards then called for vote on the main motion, as amended. Ayes: Kelly, Maetzold, Paulus, Smith, Richards Motion carried. *BID AWARDED FOR FERTILIZER FOR BRAEMAR GOLF COHPLEX/NO~ALE GOLF COURSE Motion vas made by Member Smith and vas seconded by Member Kelly for arard of bid for fertilizer purchase for Braemar Golf Complex and Normandale Golf Course to Turf Supply Company at $16,575.66, through Hennepin County Bid. Motion carried on rollcall vote - five ayes. *BID AWARDED FOR TOR0 GBEEE1SHASTlCR MOWER FOR BRAEMAR GOLF COURSE Motion ras made by Member Smith and was seconded by Member Kelly for avard of bid for Tor0 Greensmaster mover for Braemar Golf Course to recommended low bidder, MTI Distributing Company, at $14,277.39. Motion carried on rollcall vote - five ayes. *BID AWARDED FOR 1/2 TON PICK-UP TRUCK FOR PARK I"CE DEPAJlTHENT HOtion was made by Member Smith and vas seconded by Member Kelly for award of bid for 1/2 ton pick-up truck for Park Maintenance Department to Superior Ford, Inc. at $13,945.11, through Hennepin County Bid Contract X3268A4. Motion carried on rollcall vote - five ayes. *BID AWARDED FOR WELL RENOVATION - WELL X2 WOODDALE Smith and vas seconded by Member Kelly for award of bid for well renovation for well #2 Wooddale to recommended low bidder, Alberg Water Services, W, at $36,790.00. Motion was made by Member Motion carried on rollcall vote - five ayes. BID AWARDED FOR 130 INCH BIDING ROTARY MOWER FOR BRAEMAR GOLF COURSE Member Maetzold said he had asked that this item be removed from the Consent Agenda because only one bid had been received for this very expensive piece of equipment. He asked if there was some other type of equipment that would be similar in an operational sense in order to acquire additional bids. Director Keprios noted that an alternative type of equipment would be a belt driven riding mower. Tor0 being the higher bidder although they did not meet specifications. Jacobson is the only company that offers this unique piece of equipment. Jacobson representatives in other regions chose not to bid on the mower. Park That was bid against the subject machine previously with He said Member Smith made a motion for award of bid for one 130 inch riding rotary mower for Braemar Golf Course to sole bidder, North Star Turf, Inc., at $33,452.72. Motion was seconded by Member Maetzold. Rollcall : Ayes: Kelly, Maetzold, Paulus, Smith, Richards 2/21/95 Motion carried. *BID AWARDED FOR CUSHMAN 3-vHEEL T[FlRF TBUGKSTEB Motion was made by Member smith and vas seconded by Member Kelly for one Cushman 3-wheel turf truckster to recommended low bidder, Cusbman Motor Company, at $9,850.22. I Motion carried on rollcall vote - five ayes. GOLDEN VALTXY MICROWAVE FOODS PRESENTS STATUS REPORT Microwave Foods, explained their progress since the last meeting in regard to controlling the odor from their plant as follows: Michael Bley, Golden Valley 1. 2. 3. Received data to support that wet scrubber efficiency will eliminate fat- free process as the source of odor complaints, with better than 99% removal of odors. Still planning to implement process change to reduce amount of materials used - target date of March 1. Contacted Edina Sun-Current for follow-up article detailing time line for implementation of scrubber installation and start-up. 2/8/95 edition, page 2. Article appeared in Mr. Bley reported that presently they are installing piping on the roof for air handling, installing the wet scrubber and still targeting March 9 as the system startup date. components of the odor control system and explained the function of each. Member Paulus commented that she felt the residents who have been affected deserved more than a page two article in the Edina Sun-Current and that she was disappointed that a corporate citizen used that means to communicate something so serious. She noted that the Council is still receiving phone calls and correspondence from residents in the area asking what is being done about the odor. He then presented a video showing the installation of the various I Susan Lederman, 4901 Trillium Lane, spoke to the Sun-Current article in which the reporter called the odor a rich, buttery smell. She said it was foul, disgusting and repulsive. Ms. Lederman said she had contacted the City numerous times and was assured the smell would stop. Also, when she asked why the plant was not shut down she was told that it would mean a loss of jobs. Council that she has also contacted the Minnesota Pollution Control Agency. conclusion Ms. Lederman said they do not want this smell to last night and day and asked when the plant will be shut down if the smell continues. Ms. Lederman told the In Mayor Richards responded that the City has been dealing with this issue for the last 3-4 months and shares the concerns of the residents in the area. Rather than promote litigation up front, the City has tried to impress upon Golden Valley Microwave Foods that the current situation is not acceptable and they must take steps to resolve it. responsible steps to alleviate the odor and has every expectation that it will disappear. If it does not, other options will be considered. He said the City feels Golden Valley is taking Mayor Richards noted that a letter had been received from Richard Krentz, 6620 Normandale Road, asking what action the City is undertaking to abate the odor from the Golden Valley Microwave Foods plant. Mayor Richards asked Mr. Bley to report back to the Council on March 20, 1995, with the results following start up of the odor control system. I REAPPOlXR4EHT/APPOIS HADE TO BoARDS/COMHISSIOl'?S/CO~S made a motion for consent of the Mayor's reappointment of Patricia Smith to the Community Health Se-ces Advisory Connittee for a tvo year term to Febrnary 1, Member Smith 2/21/95 207 1997, and for appointment of the following individuals to advisory boards, commissions and committees : Park Board Michael Burley Comnrmmitv Health Services Advisorp Committee Pamela Nelson (consumer) Laura Kuyath (consumer) Human Relations Commission Carol Pecker (Council appointee) (3 year term to 2/1/98) (3 year term to 2/1/98) 2 year term to 2/1/97) 2 year term to 2/1/97) Motion was seconded by Member Paulus. Ayes: Kelly, Maetzold, Paulus, Smith, Richards Motion carried. RESOLUTION ADOPTED OPPOSING H.P. 431 AND S.F. 277 (EOUALIZATION ON TAX BASES1 Assistant Manager Hughes reported that H.F.431 is Representative Myron Orfield's bill which provides for the equalization on tax bases for governmental units throughout the metropolitan area. If enacted into law, this bill would replace the current fiscal disparities law. The bill would distribute, "excess tax capacity" from cities with more than $2,045 per capita to cities with less than $2,045 per capita. The effect of this bill with respect to Edina's tax rates is still unclear. increase in Edina's total extension rate to as high as a 25 percentage point increase. Staff would recommend that the Council oppose this legislation. Staff has reviewed analysis ranging from a 13 percentage point Member Smith commented that the legislation should be opposed as the real issue is control of funding for cities or what they can expend. Member Smith introduced the folloving resolution and moved its adoption: FJHEaEhs, H.F. 431 and S.F. 277 would provide for equalization of tax bases for governmental units throughout the metropolitan area, and UHEBEAS, this proposed legislation would replace the current fiscal disparities law and wdd distribute "excess tax capacity" from cities rith more than $2,045 per capita to cities with less than $2,045 per capita, and WHEREAS, the effect of this legislation with respect to Edina's tax rates is still unclear; BE IT RESOLVED that the City Council of Ed-, Minnesota, hereby opposes H.P. 431 and S.F. 277. Motion was seconded by Member Kelly. Ayes: Kelly, Maetzold, Paulus, Smith, Richards Resolution adopted. BESOUJTION OPPOSING H.F. 431 AND S.F. 277 RESOLUTION ADOPTED OPPOSING H.F. 339 (COBPICNSATION FOR OpPIClaLs> Assistant Manager Hughes informed Council that H.F. 339 would freeze the compensation of any city or county official who currently makes more than $78,500.00 annually. This freeze would remain in effect until the Legislature raises the salary of the Commissioner of Finance above that amount. any new hire for a position previously held by a person making over the limit must be hired at a level at or below the cap. represents an unwarranted intrusion into the affairs of local government and has obvious implications concerning the recruitment and retention of competent staff and the potential liability of local governments trying to implement the bill in light of collective bargaining, binding arbitration and pay equity issues. would recommend that the Council oppose the bill. The bill further would require that In staff's opinion, this bill Staff Member Paulus introduced the following resolution and moved its approval: UHERFXS, H.F. 339 rould freeze the compensation of any city or county official vho currently makes more than $78,500 annually and would remain in effect until the Legislature raises the salary of the Commissioner of Finance above that RESOUPIIION OPPOSING H.F. 339 2/21/95 208 amount; and WEBEAS, this legislation would require that any new hire for a posstion previously held by a person making over the limit must be hired at a level at or below the cap; and WEBEAS, the legislation has obvious implications concerning the recruitment and retention of competent staff and the potential liability of local governments trying to implement the bill in light of collective bargaining, binding arbitration and pay equity issues; BE IT RESOLVED that the City Council of Edina, Minnesota, hereby opposes H.F. 339. Motion was seconded by Member Kelly. I Ayes: Kelly, Maetzold, Paulus, Smith, Richards Resolution adopted. RESOKO'J!ION ADO- OPPOSING H.F. 147 AND S.F. 284 <TAX INCREMENT FJXANCI€?G DISTRICTS) Assistant Manager Hughes informed Council that both H.F. 147 and S.F. 284 have been introduced for the purpose of restricting the use of tax increment financing. In particular, H.F. 147 restricts the use of tax increments derived from districts created prior to May 1, 1990. prohibit the use of tax increments to pay principal and interest on bonds issued after February 1, 1995, or to honor binding written contracts entered into after January 15, 1995. These bills would effectively preclude additional tax increment supported expenditures within Centennial Lakes, 50th and France or the Grandview area. The proposed restrictions would Staff would recommend opposition to these bills. Member Smith noted that Edina's tax increment districts were created before 1990 and were based on the laws at that time. movement to amend or change those laws. He urged the Council to oppose any Member Smith introduced the following resolution and maved its approval: VHEBEhS, H.F. 147 and S.F. 284 have been introduced for the purpose of restricting the use of tax increment financing; and VHEBEhS, H.F. 147 vould restrict the use of tax increments derived from districts created prior to Hay 1, 1990; and WEBEAS, the proposed restrictions would prohibit the use of tax increments to pay principal and interest on bonds issued after February 1, 1995, or to honor binding written contracts entered into after January 15, 1995; and QEEREAS, this legislation wuld effectively preclude additional tax increnent supported expenditures within Centennial Lakes, 50th and France, or the Grandview area; BE IT BESOLVEI) by the City Council of Ed-, Hhnesota, that it hereby opposes H.F. 147 and S.F. 284. Motion was seconded by Member Kelly. RESOUPTION OPPOSING H.F. 147 AND S.F. 284 Ayes: Kelly, Maetzold, Paulus, Smith, Richards Resolution adopted. 1-494 CORRIDOR COMMISSION C0NSUL"T CO"I!RACT APPROVED Planner Larsen advised Council that the bylaws of the 1-494 Corridor Commission require that expenditures over $5,000 be approved by at least five of the seven member cities. The 1-494 Corridor Commission is about to begin to implement Travel Demand Management (TDM) measures within the corridor. use the services of LJR, Inc., to market TDM to employers and to assist the development of TDM plans for employers. The total cost for the 27 month contract would be $177,000. The Commission has received two federal grants which would pay for eighty percent of the contract, with the Commission responsible for the balance of the contract cost. The Commission has funds on hand to cover the required 20 percent local share. The funds come from dues paid by member cities and no additional funds are required or requested. The Commission is proposing to Participation would be voluntary. I 2/21/95 209 Planner Larsen elaborated that originally the Commission had in mind to hire an employee to carry out the task of promoting and drafting plans for employers in the 1-494 Corridor. a permanent employee situation. The proposed contract would be for a two year trial period, with the opportunity to renegotiate or to end the contract after evaluating the process as to success or failure. At that time the Commission would also be more sure of the timing for the reconstruction of 1-494 which is really the action that would precipitate the need for drastic efforts to reduce traffic on the freeway. Also, the Commission is not proposing to impose an ordinance within the 1-494 Corridor immediately but rather to give employers a chance to voluntarily create their own programs. It was subsequently decided that it would be better to avoid The consultant would begin to market TDM to 1-494 Corridor employers and large building owners. consultant would help them develop actual plans that would work for their particular situations with the overall goal to decrease the number of single occupant vehicles during the rush hours by up to 20 percent. any freeway rebuild will have HOV lanes and the goal is to make sure those are utilized. Once they became interested in the goals of the project the It is expected that Member Maetzold noted that the agreement does not speak to the expected outcomes. Planner Larsen explained that the actual scope of work is contained in the Management Plan which will be attached to the agreement. Member Paulus introduced the following resolution and moved adoption: RESOLUTION APPROVING 1-494 COBRIDOR COMMISSION CONTRACT WITH CONSULTANT BE IT RESOLVED that the City Council of Ed-, Minnesota, hereby approves the "Agreement Between the 1-494 Corridor Commission and LJB, Inc." as presented; BE IT FURTHER RESOLVED that the Mayor and Manager are hereby authorized to execute the Agreement on behalf of the City of Edina. Motion was seconded by Member Kelly. Rollcall : Ayes: Kelly, Maetzold, Paulus, Smith, Richards Resolution adopted. *€DURING DATE OF MARCH 20, 1995. SET FOR VACATION OF UTILITY AND DRAINAGE EhsElIENT ON LOT 2. BLOCK 1. SOUTH WHITE OAKS ADDITION Member Smith introduced the following resolution and moved adoption: RESOLUTION CALLING FOR PUBLIC HEARING ON VACATION OF EhsEEIwT FOR UTILITY AND DRAINAGE PURPOSES BE IT RESOLVED by the City Council of the City of Edina, Hennepin County, Minnesota, as follows: 1. of the land affected thereby that the following described easement for utility and drainage purposes should be considered for vacation, in accordance with the provisions of Minnesota Statutes, Sections 412.851 and 160.29: The east five feet of Lot 2, Block 1, SOUTH WHITE 0hB;S ADDITION, according to the recorded plat thereof, Hennepin County, Minnesota. It is hereby found and determined after receipt of the petition of the mer 2. included in paragraph 3 hereof for the purpose of holding a public hearing on whether such vacation shall be made in the interest of the public. 3. The Clerk is authorized and directed to cause notice of the time, place and purpose of said hearing to be published once a week for two weeks, in the Edina Sun-Current, being the official newspaper of the City, the first publication at' least 14 days prior to the date of such hearing and to post such notice, at least 14 days prior to the date of such hearing, in at least three (3) public and conspicuous places within the City, as provided in Minnesota Statutes, Section 412.851. This Council shall meet at the time and place specified in the form of notice Such notice shall be in substantially the following form: 2/21/95 2.1 8 NOTICE OF PUBLIC HEARJXG ON VACATION OF UTILITY AND DRAINAGE WELIWT IN TBE CITY OF EDINA -PIN COUNTY, l4IN"ESOTA NOTICE IS -BY GIVEN that the City Council of the City of Edina, Hennepin County, Minnesota, will meet at the Ed- City Hall, 4801 Uest 50th Street on March 20, 1995, at 7:OO P.H. for the purpose of holding a public hearing on the proposed vacation of the folloving utility and drainage easement: The east five feet of Lot 2, Block 1, SOU"€€ WEITE OMS ADDITION, according to the recorded plat thereof, Eennepin County, Minnesota. All persons who desire to be heard with respect to the question of whether or not the above proposed easement vacation is in the public interest and should be made shall be heard at said time and place. The Council shall consider the extent to vhich such proposed easement vacation affects existing easements within the area of the proposedvacation and the extent to which the vacation affects the authority of any person, corporation, or municipality owning or controlling electric, telephone, or cable poles and lines, gas and sever lines, or rater pipes, mains and hydrants on or under the area of the proposed Vacation, to continue maintaining the same or to enter upan such easement area or portion thereof vacated to maintain, repair, replace, remove, or otherwise attend thereto, for the purpose of specifying in any such vacation resolution, the extent to vhich any or all of any such easements, and such authority to maintain, and to enter upon the area of the proposed vacation, shall continue. BY ORDER OF THE ED= CITY COUIUCIL Marcella H. Daehn, City Clerk Motion carried on rollcall vote - five ayes. PUBLIC HEARING HEIS ON PROPOSED ISSUANCE OF HEALTH FACILITIES REVEFWE BONDS - VO- OF AMERICA: RESOLUTION ADOPTED GIVING PEU3IJHINARY APPROVAL Pursuant to due notice given, a public hearing was held on the proposed issuance by the City of Edina of health facilities revenue bonds on behalf of Volunteers of America (VOA) to finance improvements to the Edina Care Center as well as a health care facility in Crystal and to refinance outstanding indebtedness. City Attorney's ODinion By memorandum dated February 17, 1995, Attorney Gilligan advised the Council that if issued, the bonds would be payable solely from loan repayments to be made by VOA and other property of VOA pledged to the payment thereof. not be payable from any property of the City and the City would not have any liability with respect to the payment of the bonds. The bonds would It has been the standard practke of the City to charge a fee for the issuance of revenue bonds of this type. a fee of $30,000 for issuing the bonds and VOA representatives have agreed to this fee. it typically has been based upon the principal amount of the bonds and the proposed fee would be consistent wLth the fees received by the City for the Fairview bonds and Walker bonds issued previously. City staff has proposed to VOA that it pay the City While the City has no standard formula for determining the fee amount, If following the public hearing the Clty Council wishes to proceed with issuance of the bonds, the next step would be for the Council to adopt a resolution giving preliminary approval to the issuance of the bonds. When final terms of the bonds and underlying documents are substantially finalized, VOA would then come back to the Council for final approval of the issuance of the bonds. Presentation for VOA Craig Abbott, Executive Director of the Edina Care Center, gave background on the Volunteers of America (VCA) organization. Christian human service organization with three facets: 1) human services, 2) Since 1896, VOA has been a non-profit 2/21/95 211 housing divisions, and 3) health services division. Health services consists of skilled nursing facilities, assisted living facilities, and senior housing in Minnesota, Arizona, Colorado and Florida. The Edina Care Center (ECC) has been a respected member of the professional health care community since 1973 and is a 161 bed skilled nursing facility with 184 full and part time employees. Services offered include physical, occupational and speech therapy, dietary and social services, and activities for residents. A new venture proposed is subacute care which provides short term rehab as a transitional phase between hospital and home. Mr. Abbott explained that the proposed improvements for ECC are necessary to update the 20 plus year old building for the 1990's. story facility located. at Xerxes Avenue and Highway 62. house the subacute care unit with rooms similar to a hospital setting. improvements would include upgrading the rooms, nurses' stations, and entrances to meet ADA standards. business and social services, activities department and staffing break rooms. The building is a three Other The third floor would The basement level would house a new therapy area, Mayor Richards asked for a breakdown of the proposed bond issue and the fair market value of the two facilities. Mark Beese, Miller-Johnson and Kuehn, bond underwriter, explained that $1,000,000 would be spent on upgrading the two health care facilities: $500,000 at Edina Care Center and $500,000 at the Crystal facility. the outstanding bonds. and $6,000,000 for Crystal which is the bigger facility. The remainder of the proposed $8,500,000 would be used to refinance The fair market value of Edina Care Center is $5,000,000 Mr. Beese stated this is a conduit bond issue and would not affect the credit rating of the City. assets and name. by allowing cities to lend a hand by using tax exemption to achieve better financing rates. It is based strictly on the credit of VOA and backed by its The Federal tax law benefits non-profit organizations like VOA Member Smith noted that, after reviewing the background material from the last meeting, the only benefit for Edina resulting from the issuance of the revenue bonds on behalf of VOA would be a slight reduction in rates for users. how much the rates would go down. question right now but pointed out that the rates are set by the State of Minnesota for nursing home residents based upon actual costs at each facility. He asked Mr. Beese said he could not answer that Member Maetzold questioned why Edina is using the tax exempt process to benefit a facility in another community and said there must be a downside at some point in the process. As a philosophical question, he asked at what point does the City support projects outside of Edina. city are basically the same and Crystal is willing to issue the bonds on behalf of VOA without charging a fee. As underwriter, he said it would be easier to go with the one issue rather than two issues as it would be better for the borrower. Mr. Beese responded that the projects in each Member Smith asked what kind of disclaimer would appear on the bond prospectus or certificates regarding liability for the City of Edina. clarified that according to State law a disclaimer would appear on the cover of the prospectus and on the bond itself. disclaimer print size but there is a minimum. Attorney Gilligan He said there is no limit for the Mayor Richards then called for public comment on the proposed issuance of revenue bonds by the City on behalf of VOA. No comment or objection was heard. Council Comment/Action Mayor Richards commented that Member Maetzold raised a good question about the issuance of bonds for a project outside of Edina and that he did not recall Edina 2/21/95 2 1 zaving done Minneapolis consent, to Minne ap o 1 is this before. has issued bonds on behalf of Faiwiew Hospital, with the City's finance improvements at Fairview Southdale and he believed did establish some guidelines at that time. Attorney Gilligan elaborated that the City of Member Maetzold stated that VOA is an outstanding organization and he would support the proposal but suggested that guidelines be considered for future proposals. I Member Maetzold introduced the following resolution and moved its adoption, subject to payment of a $30,000 fee to the City of Edina for issuing the bonds: BESOUITION GIVING PBEILtMlWRY APPROVAL TO CEBTAIN HEALTH CARE MNPJESOTA ~ICIPAL INDUSTRIAL DEZELOPMEMI! ACT PROJECTS AND THEIR FINANCING UNDER TBE BE IT RESOLVED by the City Council of the City of Edina, Minnesota, (the City) as f ollavs : Section 1. Recitals. 1.1 This Council has received a proposal from Volunteers of America Care Facilities, a Minnesota nonprofit corporation (the "Borrower") that the City issue its revenue bonds in a principal amount not to exceed $8,500,000 pursuant to Minnesota Statutes, Sections 469.152 through 469.165 (the Act), to (i) refkance outstanding taxable indebtedness incurred to finance the acquisition and construction of or improvements to the Borrouer's existing 161bed nursing home located at 6200 Xerxes Avenue South in the City, (ii) finance improvements to the Edina facility, (iii) refinance outstanding taxable indebtedness incurred to finance the acquisition and construction of or improvements to the Borrower's existing 192 bed nursing home located at 3245 Vera Cruz Avenue North in the City of Crystal and (iv) finance improvements to the Crystal facility (collectively, the "Project"). 1.2 Internal Revenue Code of 1986, the Council has this date held a public hearing on the issuance of the revenue bonds after published notice as required by said Sections 469.154 and 147(f). As reqdred by Section 469.154 of this Act and Section 147(f) of Section 2. Findings. After due consideration, this Council hereby finds, determines and declares (a) as follows: necessary health care facilities so that adequate health care facilities are available to residents of the City and State at reasonable cost. described in Section 469.152 of the Act and, based upon information supplied by the Borrower, dd result in (i) improved nursing home facilities for residents of the City and surrounding area and (ii) a reduction in debt service charges on the Edina and Crystal facilities which will be reflected in charges to residents The welfare of the State of Minnesota requires the provision of (b) The Project would further the general purposes contemplated and and third-- ~~YOKS (c) Based on information provided by the Borrower, the economic feasibility of owning and operating the Project vill be significantly enhanced by the availability of revenue bond financing, and the purposes identified in subsection (b) above could not be accomplished except for the provision of revenue bond financing. This Council has also been advised by the Borrouer that on the basis of its discussions with potential buyers of tax-exempt bonds, revemte bonds of the city could be issued and sold upon favorable rates and terms to finance the Project . finance the Project. (d) (e) Section 3. ADRrO'Vals and Authorizations. 3.1 The City is authorized by the Act to issue its revenue bonds to On the basis of the information given the City to date, it appears that itdd be desirable for the Ciq to issue its revenue bonds in an anKnmt 2/21/95 213 not to exceed $8,500,000 under the provisions of the Act, in one or more series, to finance the Project. The Council hereby determines to proceed with the Project and its financing, and hereby declares its present intent to have the City issue its revenue bonds under the Act to flnance the Project, in an amount not to exceed $8,500,000, subject to the approval of the City of Crystal for the f-cing of the portion of the Project located in that community and subject to the approval of the Project by the Minnesota Department of Trade and Economic Development as required pursuant to the Act. Notwithstanding the foregoing, however, the adoption of this resolution shall not be deemed to establish a legal obligation on the part of the City to issue or to cause the issuance of such revewe bonds. All details of such revenue bond issue and the provisions for payment thereof shall be subject to the mutual agreement of the City, the Borrower and the purchaser or purchasers of the revenue bonds and such further conditions as the City may specify, such agreement on the part of the City to evidenced by a resolution of this Council authorizing the issuance of the revenue bonds on the terms and conditions agreed upon and authorizing the execution of necessary documents. In all events, it is understood that the revenue bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City except the revenues pledged to payment of such revenue bonds, and each bond, when, as and if issued, shall recite in substance that the bond, including interest thereon, is payable solely from the revenues received from the Project and any property pledged to the payment thereof and shall not constitute a debt of the City within the meaning of any constitutional or statutory limitat ion. be required to obtain the approval of the Commissioner of the Department of Trade and Economic Development for the issuance of the revenue bonds as required by the Act. whether or not successfully issued, shall be paid or reimbursed by the Borr 3.2 3.3 The Mayor and City Manager are authorized to take such action as may All costs of the City relating to the issuance of the revenue bonds, Adopted this 21st day of February, 1995. r. w>a Mayor A!CTEST : Dl, -%, &! City Clerk Motion for adoption of the resolution was seconded by Member Kelly. Member Smith asked what portion of the bond sale would be used for refinancing the Edina facility's debt. prepayment penalty. The breakdown would be approximately as follows: $6,600,000 in refinanced debt; $1,000,000 in project costs; $425,000 in debt service reserve fund and $400,000 in capitalized interest, working capital and issuance costs. Member Smith asked if the reserve would bear the same ratio to the amount of funds used at each facility. Mr. Beese said 51.5% would be used at Crystal and 48.5% at Edina. Philosophically, Member Smith stated he could not support this proposal because of the way it is structured. Mr. Beese answered $3,170,000 plus a one percent Mayor Richards then call for vote on the motion. Rollcall : Ayes: Kelly, Maetzold, Paulus, Richards Nays: Smith Resolution adopted. GOV"0R'S OFFICE BRIEFING TO Mc MEMBERSHIP NOTED Mayor Richards announced that the Governor's Office would deliver a briefing to the Municipal Legislative Commission membership on February 27, 1995 at 1:30 P.M. in the Governor's Reception Room to which all mayors, council members and city managers are 2/21/95 .. 2 1 $nvited. The briefing will cover federal and state budget cuts. RESOLDTIONS ADOPTED APPROVING ASSIGNMENT OF SECURITIES IN LIEU'OF BOND FOB PUBLIC FUNDS Finance Director Wallin recalled that at the meeting of February 6, 1995, the Council requested further information on the assignment of securities in lieu of bond. According to State Statute every depository must provide collateral or other security to the City to protect it against financial loss because of the depository's failure or mismanagement. The assignment authorizes the City to sell all or as much of the collateral as is needed to reimburse it for any amount lost through default of the institution. His report is summarized as follows. FNMA is an acronym for Federal National Mortgage Association and REMIC is an acronym for Real Estate Mortgage Investment Conduit. created under the Tax Reform Act of 1986 for issuing mortgage-backed securities and can hold loans secured by any type of real property and issue multiple classes of ownership interests. Obligation (CMO), REMICs qualify for more favorable tax and accounting treatment for the issuers and are generally more economical. corporations, partnerships, trusts, or as a segregated pool of assets and will not be subject to taxation at the issuer level if they comply with the requirements of the Tax Reform Act. governments under State Statute. REMIC is a tax election Although similar to a Collateralized Mortgage REMICs may be structured as It is a permissible investment by local Member Smith suggested that the phrase "good and sufficient" in reference to the collateral be stricken from the resolutions. Member Paulus introduced the following resolution and moved its approval as modified: RESOUTTION APPROVING ASSIGNMENT OF SECURITIES IN LIEU OF BOND - FIBST BANK NATIOIUL ASSOCIATION BE IT RESOLVED that the City Council of the City of Edina, Minnesota, approves the assignment by Xts depository, First Bank Nationalhssociation, of the following securities as collateral for the City of Edina Public Funds deposited in said depository: US TBEdswY 6 1/2 Note X97 6.500 8/15/97 $3,760,000.00 FNHAREMIC CL55E 6.200 4/25/05 $ 230,000.00 Motion was seconded by Member Smith. DESCRIPTION - RATE - DUE PAR VALUE Rollcall : Ayes: Kelly, Maetzold, Paulus, Smith, Richards Resolution adopted. Member Haetzold stated that he would not participate in either the discussion or the voting on the resolution approving assignment of securities in lieu of bond for the National City Bank. Member Smith introduced the following resolution and moved its approval as modified: RESOLUTION APPROVING ASSIG"T OF SECURITIES IN LIEU OF BOND - HhTIONATa CITP BANK BE IT RESOLVED that the City Council of the City of Edina, Minnesota, approves the assignment of its depository, National City Bank, of the folloVing securities as collateral for the City of Edina Public Funds deposited in said depository: DESCRIP!CIOH - RATE - DUE PAR VdUIE US TBEbsuBY 4 1/4 MOTE Y96 4.250 5/15/96 $ 500,000.00 Motion was seconded by Member Paulus. 2.1 2 11 95 215 Rollcall : Ayes: Kelly, Paulus, Smith, Richards Abstained: Maetzold Resolution adopted. CTAlHS PAID claims as shown in detail on the Check Register dated February 16, 1995, and consisting of 30 pages: General Fund $272,725.75; C.D.B.G. $58.50; Communication $733.20; Working Capital $19,413.42; Art Center $6,681.39; Swimming Pool ($917.13); Golf Case $29,838.91; Ice Arena $33,161.63; Gun Range $106.86; Edinborough/Centennial Lakes $41,127.80; Utility Fund $38,011.88; Storm Sewer $159.73; Recycling $35,940.56; Liquor Fund $60,171.00; Construction Fund $8,513.50; IBR #2 Fund $14,662.46; TOTAL $560,389.46; and for confirmation of payment of the following claims as sham in detail on the Check Register dated February 9, 1995, and consisting.of one page: General Fund $159,910.46; Golf Course $11,495.71; Edinborough/Centennial Lakes $60.00; Liquor Fund $180,736.71; TOTAL $352,202.88. Member Smith made a motion to approve payment of the following I Motion was seconded by Member Maetzold. Rollcall : Ayes: Kelly, Maetzold, Paulus, Smith, Richards Motion carried. There being no further business on the Council Agenda, Mayor Richards declared the meeting adjourned at 9:lO P.M.