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HomeMy WebLinkAbout11-28-11 WSCity of Lakeville Council Work Session Minutes November 28, 2011 In attendance: Mayor Mark Bellows Council Member Laurie Rieb Council Member Kerrin Swecker Council Member Matt Little Council Member Colleen LaBeau Staff: Steve Mielke, City Administrator Daryl Morey, Planning Director Dennis Feller, Finance Director Mike Meyer, Fire Chief Cindi Joosten, Human Resources Manager Judi Hawkins, Deputy City Clerk Mayor Bellows called the meeting to order at 6:00 pm. Council Member LaBeau arrived at 6:05 p.m. ITEM #1 - Lennar Development Concept Plan. Lee Johnson, Lennar Corporation Land Development Coordinator, stated that Lennar has an option to purchase 200 acres from Joe Miller Farms, west of Cedar Avenue at future 185th Street. Lennar formerly operated as Orrin Thompson Homes and Lundgren Bros. Construction and has been an active builder in the Lakeville area for many years. 185th Street is anticipated to become a main east /west corridor through the city resulting in this becoming a major intersection. He stated that the concept plan proposes RS -4 and RS -3 single family and medium density residential development with commercial adjacent to Cedar Avenue, which is consistent with guidelines for the Cedar Avenue BRT Corridor. The concept plan also proposes the construction of 185th Street (CSAH 60), a major east -west corridor through the city. The commercial is not anticipated for development at this time. A greenway corridor along the DNR tributary will be built into the development's amenities. Mr. Johnson gave an overview of the storm drainage and water /sanitary sewer accessibility in the area and does not believe there will be capacity issues. He is working on obtaining the necessary easements for the extension of trunk sanitary sewer across nearby properties. He believes that the marketing of their project would also attract potential home buyers to residential developments in other areas of the city. He stated that the market needs to dictate development and the City should not be involved with competition. He sees this as an opportunity to spotlight the city in a positive way and believes staff's concerns regarding the premature subdivision criteria can be addressed. He is asking for the Council to provide some guidance and indicate their level of support. City Council Work Session Minutes November 28, 2011 Page -2- Planning Director Daryl Morey stated that of the 200 acres in the subject property, the north 80 acres are zoned high density and medium -high density residential. The remaining 120 acres lie within a Special Plan Area of the Urban Reserve as identified in the City's 2008 Comprehensive Plan, which means that sanitary sewer is not planned until after the year 2020. The Planning Commission reviewed Lennar's concept plan at their October 20, 2011 work session and some members expressed concern about leapfrog development and that development of this property is premature. There are over 1,000 acres of platted and unplatted developable residential land in the current MUSA, in addition to land located within the Spirit of Brandtjen Farm PUD. In addition, there are properties in Expansion Areas A and B that are waiting to be brought into the current MUSA. Premature subdivision issues that would need to be addressed by the developer include inadequate drainage, water supply, roads and highways, waste disposal systems, and City service capacity. The concept plan would require a Comprehensive Plan amendment, which must also be approved by the Metropolitan Council. Mr. Morey stated that there are currently about 950 vacant platted residential lots now available in the city. This represents a seven year supply given the current construction rate of approximately 130 single family homes each year. Council Member Swecker asked when the property would be developed, if approved by the City Council. Mr. Johnson said it could be next summer before the Comprehensive Plan amendment and EAW would be complete. Council Member Rieb questioned Mr. Johnson about his statement that some of the vacant single family lots in the current inventory are listed at 2006 prices. Does this mean the lots in the Lennar development would sell for less? Mr. Johnson stated that the price of the lot is included with their homes and yes, they could conceivably be at lower prices than their competitors. Council Member LaBeau asked staff to break down the inventory of buildable lots by school district. Mr. Morey responded that there are 364 vacant single family lots in the Lakeville school district and that approximately 210 of those have city streets and utilities currently available. Council Member Swecker said she would be interested in seeing what vacant land is available in the current MUSA zoned R -2, R -3 or R -4. She asked what the risk to the City is and what the hidden costs are to taxpayers for "leapfrog" development. Council Member Little asked staff to explain how zoning classifications and the MUSA staging are determined. Mr. Morey stated that MUSA staging is based on proximity to existing trunk sanitary sewer and an orderly progression of development. Mr. Johnson said Lennar has agreed to construct a reliever pipe to alleviate excessive waste for the existing infrastructure. Little asked if the developer believes it is unfair to change the comprehensive plan for one developer when others have been waiting for their properties to be brought into the MUSA. Mr. Johnson said he sees it as an opportunity for the city. He doesn't believe the City should be the gatekeeper for development but the market should determine what gets built. City Council Work Session Minutes November 28, 2011 Page -3- Mr. Johnson stated that information would be included in Lennar's marketing materials to notify potential buyers of the future commercial development of the property. Mr. Morey addressed Council Member Swecker's question on potential risks to the city. He stated that allowing this development would deviate from the City's long- standing comprehensive growth management policies. There are potential maintenance issues associated with extending trunk sanitary sewer and water lines through property that is not in the current MUSA. If Council decides to pursue this, staff would recommend planning and engineering studies for the entire 1,500 acre Special Plan Area. The estimated $25,000 to $30,000 cost of these studies is not currently budgeted. Mr. Mielke stated he has spoken to several developers who believe the use of MUSA for growth management should be reconsidered. Trunk sanitary sewer capacity and water pressure zone issues as well as the possible extension of 185th Street to Highview Avenue will need to be considered. Mayor Bellows asked if there was anyone in the audience who wished to address the Council on this item. Matthew Weiland, representing the owner of several lots in Donnelly Farms, believes Lennar is a good builder, but that the timing is wrong. Allowing expansion into areas that are currently not in the MUSA will have a negative impact on property values. He believes the focus should be on finishing those neighborhoods where streets are already built, stabilizing property values, and controlling growth. Jim Deanovic, the owner of lots in Donnelly Farms, believes that this development is about a year or two premature. Lakeville's land use plan states that land will not be brought into the MUSA until there is less than a five year supply of buildable land. Lennar has opportunities to build in several areas that are currently in the MUSA. Mark Zweber stated that from last spring's developer forum he believed the City was trying to spur development and this could be just what the city needs to generate excitement and growth. A newspaper article last weekend indicated that the school district is worried about declining enrollment. He would support the project. Rich Hocking, attorney for property owner Joe Miller Farms, stated that Mr. Miller is very much in favor of this project moving forward. He believes the Cedar Avenue corridor will be a significant factor in the development of this area along with the extension of 185th Street. This will be a phased development by a large builder, which he believes will be beneficial to small builders and buyers in stimulating the market. Council Member Swecker said she would support having the land use and engineering studies completed but is concerned with the cost and is not willing to put this in the 2012 budget. She needs to see how developing the property at this time would benefit the community as a whole. Mr. Johnson said Lennar would pay a percentage of the cost of the studies. City Council Work Session Minutes November 28, 2011 Page -4- Council Member Rieb stated that the City of Lakeville has always approved orderly development and would prefer that policy to continue. She would like more information on cost vs. benefit to the taxpayers before she could make a decision. Council Member LaBeau agreed that the studies should not be a financial burden to the City and that consideration has to be given equally. The comprehensive guide plan was adopted in order for the city to develop in an orderly way. Council Member Little concurs that while government should not be involved in the marketplace and the market has to correct itself; government needs to be predictable and fair to all developers. He believes this is mainly a fairness issue and would be a "slippery slope" if the same rules are not applied to everyone. Council Member LaBeau said in the development industry things are not always fair but the City needs to be aware that currently the number of active developers is limited. Council Member Little stated that if every developer knew they could develop land outside the MUSA less expensively than inside the MUSA, most would choose the less expensive option. The Council should honor the City's adopted Comprehensive Plan. Council Member Swecker asked how approval of this development could benefit the community as a whole. Mayor Bellows stated that development of the BRT Corridor could justify the studies and some benefits are being suggested in the concept. Mr. Mielke stated that if the Council wishes to consider the proposal further, staff recommends authorization of a land use study and an engineering study of the Special Plan Area /Urban Reserve. The engineering study should determine the impacts of extending sanitary sewer and water trunk lines in a non - contiguous fashion, such as the ability to maintain capacity for the undeveloped land to the north that is located within the current MUSA, City maintenance costs associated with extending utilities past undeveloped property, and the budget impacts of the City. Mr. Mielke stated that the entire sewage flow area needs to be studied, including the cost for extending and maintaining the sanitary sewer lines, not just for the subject property. The land use and engineering studies are estimated at $25,000 to $30,000 and since funding is not included in the 2011 or 2012 budget, a funding source needs to be identified. After these questions are addressed, the development would become a policy issue of opening up a non -MUSA area of the city for development. Mr. Morey stated that additional properties would need to be included in the land use and engineering studies. The study should include all of Expansion Areas A and B, which are planned for sanitary sewer service prior to the Urban Reserve area. He also pointed out that any study completed in conjunction with a Comprehensive Plan amendment would have to be approved by the Metropolitan Council. Mr. Johnson stated that Lennar chose this property for its location and development potential and the negotiated price of the land was based on the foreclosure amount. Lennar does not wish to proceed with the purchase of the property if the Council is not willing to consider their concept plan, so they are looking for some indication from the City Council Work Session Minutes November 28, 2011 Page -S- Council. If the studies cannot be completed in time to meet the purchase agreement deadline, and no decision will be made until the studies are complete, he could try to restructure the purchase agreement. Council Member Swecker stated that even though the City is very interested in development at this time, there are many property owners who are waiting for their property to be brought into the MUSA for both residential and commercial development. Mr. Morey stated that the land use study would be done first, followed by the engineering study. These studies would be reviewed by the Planning Commission and City Council. Following review, a formal Comprehensive Plan amendment would be processed. The studies could take three to four months to complete, based on the number of properties involved. Staff will work with the developer on the scope of the studies and on possible funding and report back to the Council. ITEM #2 - Fire Department Administrative Office Relocation Fire Chief Mike Meyer presented an overview of options for remodeling or relocating fire administration personnel. Chief Meyer had previously provided information on space issues being faced by the Fire Dept. Since that time a space needs analysis has been conducted which suggested three options to maximize efficiency of the department. Option A is to remain status quo in the current configuration at Fire Station # 1. Current space was not intended to accommodate fulltime staff, and is,being shared with Fire operations. Additional staff which will be needed in the future will exacerbate the issue. Whether staff remains at this location or not, both upper and lower levels will need to be updated, including removal of some carpet and walls. Option B is to relocate Fire administration to the second floor of Station # 1. The main advantage is that it would stay within the main city campus and the public would not be confused about the location. However, there would not be anyone on the lower level to greet the public and this renovation would require the installation of an elevator. This option would eliminate the training room at Station # 1. Option C would relocate administration to Fire Station #4 and remodel Fire Station # 1. Proposed space at FS #4 is currently used as a garage and staff quarters for ambulance equipment and personnel, which would relocate to the Water Treatment Facility. Fire relief and training officers would stay at FS #4. This option would provide adequate space for additional future staff and would allow the training room to remain on the second floor of FS # 1. Staff is recommending Option C using funds as appropriated in the 2011 Building Fund in addition to funds set aside for retaining wall repair at Station #3. The wall would be delayed until 2014, or when funds are available. Staff recommends retaining Tushie City Council Work Session Minutes November 28, 2011 Page -6- Montgomery for architectural services and Contegrity Group for construction management. Council directed staff to proceed with relocation of fire administration to FS #4 and phase 1 remodeling of FS #I in 2012, as presented. CITIZEN COMMENT: Ron Gerk asked the Council to consider increasing night police patrol staffing. He believes the poor economy is responsible for a higher crime rate in the City. Council members were concerned that they had not been informed of an incident which occurred on Saturday evening. ITEM #3 - 2012 Budget and Tax Levy Review Finance Director Dennis Feller stated that the topics to be reviewed prior to the Truth in Taxation Public Hearing on December 5 are the tax levy, budget adjustments, and budget review and considerations. Mr. Feller reviewed budget materials that had been provided to Council in his memo dated November 28, 2011. He stated that three residents contacted him after receiving their tax statements; two of them requested further information about property values and taxable values. Due to several factors, i.e., stability of business values compared to residential values and the market value exclusion, the tax burden is shifting from residential to commercial/ industrial properties. Council Member LaBeau stated that property taxes on businesses have been increasing the past five years; she believes businesses have reached the limit of taxability and the burden needs to start shifting back to the residents. Mr. Feller stated that when the residential property values start increasing and are in sync with commercial values, this will equalize. Mr. Feller identified budget adjustments and effects on general fund balances. Council members asked if the Finance Director believes a 40% fund balance is adequate. Mr. Feller stated that the 40% also includes contingency funds for increases in wages and benefits which are unknown at this time. Council Member Little questioned the transparency of this method of financing for benefits. Mr. Feller stated that the funds can be taken out of the contingency funds and put in the general fund, which would increase the fund balance to 43 %. Mr. Feller provided a summary of major initiatives. • Firefighters are seeking a 3% pension increase. Comparisons to other cities were provided to the Council. Investment performance of the fund is difficult to predict, however, assuming a 5% return on investments, the City's cost would be $39,000 for City Council Work Session Minutes November 28, 2011 Page -7- the requested increase. Council supported the 3% pension increase and raising the levy to $60,000 in 2013. The Fire Dept. will need to ratify this also. • A discussion was held on opening ice rinks. Council was asked if they wish to authorize opening one or more additional rinks for the 2012 -13 skating season. Mayor Bellows stated that Highview Heights was a demographic argument because of it being in a different school district. Council Member Rieb asked to see updated demographic figures for all rinks. Council Member Little does not want to arbitrarily open rinks. He suggested leaving discussions open -ended for additional rinks next year and reassess the issue. Council directed staff to budget to leave Highview Heights rink open through the 2011 -12 skating season and reassess next year, based on prioritization by the Parks, Recreation and Natural Resources Committee. • The Personnel Committee will work with Human Resources staff to pare down the scope of work for the labor market study. Portions of the study need to be done to make sure that laws are followed and State mandates are being met. LaBeau does not support this study. Little asked to see the scope of work. Swecker suggests a partial study being completed or some work being done in- house. Mr. Mielke will bring further information before the Council for direction. • Mr. Feller discussed additions and changes to the 2012 -2016 Capital Improvement Program that will have an effect on the budget. Projects will include the Hwy. 50/60 roundabout, Co.Rd. 70 /Dodd Blvd.; Kenrick Avenue; Valley Park and Clays Acres watermain replacements; and removal of Liquor Store land acquisition. ITEM #4 - Policy Manual Changes Human Resources Manager Cindi Joosten had met with the City Attorney regarding article 3.06, City Council /Staff Relations, and presented Council with alternate language. Council had previously reviewed this item at their October 24th work session. Council directed staff to prepare the item for the upcoming Council agenda. ITEM #5 - Board /Commission Reappointment Procedures. A discussion had previously been held regarding procedures for the reappointment of members to City advisory boards and commissions. Currently, members whose terms are expiring at the end of the year are notified and asked if they wish to be reappointed. On rare occasions, an advisory board or commission member will not be reappointed on the recommendation of the board chair. Council members suggested a more in -depth evaluation or possibly re- interviewing existing members prior to reappointment. Council Member LaBeau also spoke in favor of term limits. Council Members Swecker and Rieb did not support term limits, as they believed that could take away a great deal of historical knowledge from the committees. Swecker stated that she would not be opposed to re- interviewing committee members before reappointing them. Council Member Little added that members can be evaluated or asked to step down at any time. Mr. Mielke suggested that a policy for a formal review process be drafted to evaluate the performance of committee members based on criteria such as attendance, City Council Work Session Minutes November 28, 2011 Page -8- participation, working as a team, etc. Council could then determine on a member -by- member basis whether they wish to re- interview and reappoint. A review process will be established. ITEM #6 - 2012 Council Committees and Inter - Agency Appointments DCC needs an appointee for their board by January 1 S'. Council Member Rieb will take Council Member LaBeau's liquor committee appointment; LaBeau will take Little's appointment to the Cedar Improvement Group. The City engineer will be appointed to the 1 -35 Solutions Alliance in place of the City Administrator. ITEM #7 - Other There were no interagency committee /board reports. Mr. Mielke suggested that the December 12'" Work Session be cancelled, unless Council wishes to further discuss the budget. Other items can be put on the January agenda. Due to increased public attendance at meetings, it was suggested that the Water Treatment Facility conference room would be a better location for Council Work Sessions in 2012. The room would lend itself to presentations and conversations while accommodating a larger audience. Council will begin holding their work session there in 2012. ITEM #8 - Adjourn The meeting adjourned at 9:20 p.m. Respectfully submitted, J i Hawkins, Deputy Clerk Mark Bellows, Mayor