City of Waverly Minutes

April 12, 2006 Regular Session Pursuant to notice and call the Waverly City Council met in regular session at 7:00 p.m. on Wednesday, April 12, 2006 in the council chambers of Waverly City hall. Those in attendance were Mayor Bush, Clerk Ryks, and Council Members: Antil, Henry-Neaton, and Hausladen. Council Member Olson was absent. Agenda George Karels asked to be removed from the agenda. The agenda was approved by consensus of the council members. City Attorney’s Report Clerk Ryks spoke with City Attorney Young regarding the legality of the alley vacation proposed by the Church of St. Mary. It is not considered a real estate transaction or an issue between the law separating church and state. The issue before the council is whether the property should be taken out of public status. Young will send a letter to the council regarding this issue. Resolution 06-04 was presented approving the summary publication of the Lakedale Open Video System franchise ordinance. One correction was noted on page two to change the City of Maple Lake to the City of Waverly. Motion by Henry-Neaton, seconded by Hausladen to adopt Resolution 06-04 as corrected. Carried 4-0. Wright Co Sheriff Additional monitoring of Legion Park was requested due to the spring/summer season. Waverly Fire Department, Inc There were no fire department members present at the meeting. City Engineer’s Report-Barry Glienke City Engineer Glienke presented Payment Estimate #4 submitted by Kuechle Underground in the amount of $14,318.40 for the East Carrigan Lake Utility Extension project. Motion by Antil, seconded by Hausladen to pay Kuechle Underground the amount of $14,318.40 as requested. Carried 4-0. City Engineer Glienke requested authorization to advertise for bids for the Legion Park Improvement Project. The specifications included tennis courts and basketball courts. Once bids are received, it can be determined whether to proceed with both courts. The construction schedule reflects a completion date of June 30, 2006. The City Engineer calculated a cost estimate for the project of $125,000. Council Member Hausladen asked if the construction schedule could be revised for an earlier completion date since Waverly Daze is scheduled for July 7, 8, 9. Engineer Glienke stated that sufficient time is needed between the bid award and the execution of contract documents. If the contract is expedited quickly, the construction start date could be moved up. Motion by Antil, seconded by Henry-Neaton to move ahead with project for Legion Park. Carried 4-0. Park Superintendent Woitalla informed the council that $100,000 was included in the budget for 2006 park improvements. Minutes The minutes of the March 10, 2006 Work Session were presented. Motion by Antil, seconded by Henry-Neaton to approve the March 10, 2006 minutes as presented. Carried 4-0. The minutes of the March 15, 2006 Regular Session were presented. Motion by Hausladen, seconded by Antil to approve the March 15, 2006 Regular Session minutes as presented. Carried 4-0. The minutes of the March 20, 2006 Joint Meeting with Waverly Fire Department, Inc. were presented for approval. Motion by Antil, seconded by Henry-Neaton to approve the March 20, 2006 Joint Meeting minutes as presented. Carried 4-0. Accounts Payable The accounts payable was presented in the amount of $127,340.99. Motion by Hausladen, seconded by Henry-Neaton to approve the accounts payable in the amount of $127,340.99. Carried 4-0. Park Commission Report Parks Superintendent Jim Woitalla gave the Park Commission report to the council. Woitalla submitted a recommendation from the Park Commission for the appointment of Chris Kittock as Secretary/Alternate Member. Motion by Henry-Neaton, seconded by Hausladen to appoint Chris Kittock as Secretary/Alternate Member of Park Commission. Carried 3-0. Abstain: Antil. Greg Lammers and representatives of the Waverly Lions Club will be attending the April 19, 2006 Park Board meeting to discuss camping at Legion Park during Waverly Daze. The concerns of Park Commissioners for allowing camping at Legion Park during Waverly Daze include previous problems experienced such as damage to grass caused by campfires and clean up issues. The Park Commissioners discussed charging a damage deposit and fee for the campsites. A 3 day special event permit could be considered for the camping during Waverly Daze. There have not been any problems with campers at Railroad Park during Waverly Daze. Campers at Railroad Park include Tractor Show participants that want to watch their equipment that is parked in Railroad Park. The Waverly Lions organization would be responsible for the camping in the park, not a specific individual. The Park Commission will make a recommendation to the council following their meeting with Lammers and the Waverly Lions. The Park Commission accepted the park dedication plan for Carrigan Trails (Douglas Property) with stipulations. Ray Williams, Trail Head Development requested the recommendation in writing. The following is a list of stipulations formulated by the Park Commissioners: 1. Street lights bordering roads, 2. east side of wetland between outlot G and west side of 1st Street is not accepted, 3. pond in outlot H is to be moved out of park, 4. clean dead trees and debris in outlot H, 5. park to be leveled and seeded, 6. water, sewer stubs are to be installed into the park, 7. compliance with EPA regulations for outlot H will be enforced; 8. outlot G will be made into a square lot instead of a dog eared shape. Motion by Antil, seconded by Hausladen to accept the parkland with the 8 stipulations as recommended by the Park Commission. Carried 4-0. The plan approval is for the concept plan dated August 2005 and submitted on February 8, 2006. Planning and Zoning Report The Planning Commissioners reviewed the concept plan for the proposed Carrigan Trails development. The Planning Commissioners rejected the proposed lot sizes. The land is located in an area planned for larger lot sizes. Kane & Johnson Architects were present at the Planning Commission meeting to discuss the St. Mary’s Church renovation project. A public hearing was scheduled for May 4, 2006 to consider the application for a conditional use permit for this project. The City Engineer is working with the architects on utility issues. A stipulation will be included in the conditional use permit, if granted, that there will be a road use restriction to 7th Street during the project and contractors are to refrain from using 6th Street and Maple Avenue. The start date is unknown and is dependent upon financial contributions. The building plans still need to be finalized. Economic Development Authority With cooperation from the city, the Economic Development Authority is hosting a Development Open House event on April 25 at Noon at the Waverly Village Hall. A luncheon is being catered by Waverly Café and Waverly developers will make presentations to the group of realtors, bankers, and contractors that were invited to the event. Maintenance Report Maintenance Supervisor John Rassat was present at the meeting to give the monthly Maintenance Department report. Rassat reported that he contacted architects to have a preliminary plan drawn for a proposed Maintenance/City Hall facility. A $600,000 budget for building construction was submitted to the architects. The Council authorized the expenditure of funds for the purposes of obtaining a preliminary drawing for review. Rassat will present the preliminary plan at the May 10, 2006 council meeting. The building project is contingent upon the sale of the existing building to Waverly Fire Department, Inc. Engineer Glienke reported that Mike Stevens is ready to execute the development agreement to begin infrastructure work in the Waverly Industrial Park. Rassat checked with Building Inspector Beckfeld and state law requires an architect for proposed building project. Rassat submitted bids received through the State of Minnesota bidding process for Freightliner and International models. The 1982 International Truck is being sold to a private party for $5,200. Rassat is proposing to purchase the International truck through the state bid for the cost of $102,349 which includes the truck box and wing attachment. New EPA regulations will be effective in 2007 and would add approximately $8,000 to the vehicle cost. Maintenance staff looked at trucks and test drove a variety of vehicles. Staff is recommending that the city purchase the International truck as it has the best visibility and a nice cab. If the order was processed immediately, the delivery date would be November 1, 2006. $50,400 is included in the cost to purchase a plow from J Craft. The total cost is $102,349. The major equipment budget for 2006 is $117,000. A payment is not needed on the truck purchase until August 2006. Payment would not be required on the plow until November 2006. Motion by Hausladen, seconded by Antil to accept Rassat’s recommendation for the purchase of the International Truck package for $102,349. Carried 4-0. Rassat commented that $15,500 was paid for the 1982 truck. The city received a good life and value for the 1982 truck. Parks Superintendent Jim Woitalla reported that Cottonwood trees will be removed at Legion Park this week. Pricing is being obtained for fencing at Legion Park that is planned to be done concurrently with Legion Park improvements. Bill Schoening’s last day of work is April 14. 30 applications have been picked up so far for the job opening for Maintenance Worker. Community Liaison Pam Henry-Neaton reported that 100 welcome packets have been assembled with the help of city staff. 5 welcome visits were done last Saturday. 5th Street S. Vacation A Resolution calling for a public hearing will need to be adopted. A public hearing was scheduled for May 10, 2006. Motion by Antil, seconded by Henry-Neaton to adopt the Resolution scheduling a public hearing on May 10, 2006 to consider the vacation of 5th Street. Carried 4-0. 3.2 Beer Applications The Church of St. Mary and the Waverly Lions have applied for 3.2 beer licenses. The license period is April 1, 2006 – March 31, 2007. Motion by Hausladen, seconded by Antil to approve the 3.2 license application for the Church of St. Mary for the Fall Festival on September 9-10, 2006. Carried 4-0. Motion by Henry-Neaton, seconded by Hausladen to approve the 3.2 license application of the Waverly Lions for the period of April 1, 2006-March 31, 2007. Carried 4-0. LMC Conference The annual League of Minnesota Cities Conference is being held June 28-30, 2006. Council Members should advise Clerk Ryks if they are interested in attending the conference. MLS Report The March 2006 Municipal Liquor Store was presented. Motion by Henry-Neaton, seconded by Hausladen to adopt the March 2006 Municipal Liquor Store report. Carried 4-0. Joint Meeting w/ Woodland Township A joint meeting was scheduled with Woodland Township officials on April 27 at 7pm at the Waverly City Hall to discuss the pending annexation by Phillip Ludwig for the property located at 6231 Dempsey Avenue. Other Business Pam Henry-Neaton asked about the possibility of the city paying the postage expense for letters being sent out by the MEDA group. Motion by Henry-Neaton, seconded by Hausladen that the City pay for postage for soliciation of funds for the MEDA program. Carried 4-0. Montrose Rate Committee A rate committee meeting is being held at the City of Montrose on April 13 at 4pm. Pam Henry-Neaton, John Rassat, and Deb Ryks will attend the meeting. Clean up Day Deb Hausladen, Charlie Bush, and Pam Henry-Neaton will serve as council volunteers during Clean up Day on Saturday, April 22. Acknowledgements Council Member Henry-Neaton recognized Bill Schoening for 3 years of service with the City and wished him good luck in the future. A thank you was issued to Charlie Bush, Mary Johnson, and Lori Jones for helping with the welcome packet assembly. The meeting was recessed for five minutes at 7:50 p.m. The meeting was reconvened at 7:55 p.m. 2005 Audit Report Matt Mayer and Caroline Stuntsman, Kern, DeWenter & Viere were present at the meeting to give the 2005 audit report to the council. Mayer explained that the city is currently operating on a cash basis accounting system which is an accounting of cash received and cash expended during the year. An Emphasis of Matter Paragraph was added to the financial reports stating that the auditing firm is of the opinion that future debt restructuring may be needed to meet city obligations. Mayer discussed the General Fund Budget with the council. A deficit budget was planned for the general fund in 2005. The 2005 Budget accounted for a declining balance of $357,000. 2005 Receipts were $123,000 over the amount budgeted. The increase in reveneues was due to repayments received from developers for engineering services. The 2005 Disubrsements were over budget by $211,000 due to engineering expenses for developments. Mayer is suggesting that separate funds are used to account for development payments and receipts. Development costs should be taken out of the general fund budget. The general fund realized a deficit of ($766,000) at the end of 2005. This amount represents a full year of expenditures. The City of Waverly Fund balance policy is not being met at the current time. Caroline Stuntsman reviewed the management letter with the City Council. A 5 year trend for general fund receipts/disbursements was included in the management memorandum prepared by Kern, DeWenter, Viere. Miscellaneous receipts increased due to developer’s reimbursements. LGA/property tax revenues have remained the same over the last 4 years. Local Government Aid was cut two years ago. Capital outlay increased from 2004. The $225,000 flood debt repayment was made in 2005. Cash has declined over the last 5 years. Water revenues experienced a decrease from the previous year since there new connection fees were down by 10 new construction permits. Disbursements increased by 50%. Debt service payments are a large part of the disbursements in the water fund. Sewer fund balance has declined due to debt service payments. Transfers from water to sewer fund are planned in the future in accordance with the utility rate analysis report prepared by City Engineer Glienke. Liquor Store sales increased by 30 percent, and the cost of sales increased 31 percent. The gross profit percentage is recommended to be 39 percent. The current gross profit percentage is 33.4%. In 2002 the gross profit percentage was 37.5%. Matt Mayer presented the audit findings. A material weakness was noted related to the city’s budgeting process. General fund operations need to be revised due to extremely low balances. There is a 2006 budget deficit in the general fund of $310,000. The city may need to change operations or consider cash flow borrowing. Bond payments are $380,000. Transfers from the water/sewer funds are made annually for the bond payments. The utility funds may have reduced balances with the annual transfer amounts. He explained that the city can levy for bond obligations if there shortfalls in utility funds because the bonds are general obligation. Mayer suggested that the city review its fund balance policy and use with the annual budget. He recommended that the city review and possibly amend the 2006 budget to create a balanced budget. Mayer is suggesting a new accounting system since the State CTAS accounting system is limited in its capabilities. Mayer stated that the Municipal Liquor Store’s purpose is to generate resources for the city. Currently the Waverly Municipal has experienced a 3 year loss. Mayor Bush explained that the city is committed to 40 percent levy increases during the next few years. The Council members informed Mayer that many financial pressures were forced on the city by a lack of state funding. Mayer reiterated that the city levy has been flat from 2002-2005. Tax increases are needed. Mayer stated that the city should have increased taxes in the past and the increases would have been a minimal effect on taxpayers due to tax capacity. It will be difficult going forward to recover the funds to support city obligations. A WAC/SAC usage policy was suggested by Mayer. A policy for check processing at the liquor store is needed. A policy should be put in place to prevent NSF checks. A loan repayment by the liquor store is needed and should include interest charges from money advanced by the city. Due to timing of transfers between the savings and checking account caused an overdraft notice in 2005. This should be watched so that transfers are made as needed. It was noted that Fire Relief Association accounts are listed under the City’s Federal Identification Number at Citizens State Bank of Waverly. This will need to be updated and the accounts placed under Waverly Fire Department Inc.’s federal identification number. The City of Waverly Vacation policy was amended in 2005 and a maximum was established. A specific time frame for vacation usage should be established. A reminder was given that the auditors may be contacted and used as resources throughout the year. Adjournment Motion by Bush, seconded by Henry-Neaton to adjourn the meeting at 8:35 p.m.. Carried 4-0. ______________________________ ______________________________ Deborah Ryks, Clerk Charles Bush, Mayor

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