Loading...
HomeMy WebLinkAbout02-22-16 WSCITY OF LAKEVILLE CITY COUNCIL WORK SESSION MINUTES February 22, 2016 Mayor Little called the meeting to order at 6:00 p.m. in the City Hall Marion Conference Room. Members Present: Mayor Little, Council Members LaBeau, Davis, Anderson and Swecker. Staff present: Justin Miller, City Administrator; Allyn Kuennen, Assistant City Administrator; Chris Petree, Public Works Director; Daryl Morey, Planning Director; Zach Johnson, City Engineer; Jerilyn Erickson, Finance Director; Dave Olson, Community and Economic Development Director; Judi Hawkins, Deputy City Clerk 2. Citizen Comments: None 3. Discussion Items: a. Development Fees City Administrator Miller provided an overview of recent discussions regarding development fees, how they are determined, and how they are used. Development fees are charged in three phases: platting, development and building. A typical $400,000 home incurs fees of about $17,100, which include storm area charge, park dedication fee, water connection charge and building permit. The Finance Committee reviewed the information compiled by staff and discussed it at their February 3, 2016 meeting. In an effort to better understand the fees the Finance Committee asked Council to explain their philosophy on fees: whether they want to encourage or discourage development; if they are more interested in producing revenue or receiving reimbursement for services; and what Council believes is the benefit of park dedication for businesses. Council Member Swecker asked if $400,000 is actually the average home cost. Finance Director Erickson stated that this value includes the lot. Mayor Little stated that because water and sewer fees need to be paid up front, Council and staff have previously discussed modifying those fees to possibly assist homeowners. Mr. Miller stated that Council's philosophy has been that water connection fees offset the cost of new infrastructure rather than subsidizing those costs with higher operating rates. Mayor Little suggested looking at options for using these fees as a tool in an incentive package, i.e., allowing financing of a portion of the costs over time. Council Member Anderson commented that although some people believe that fees could be a detriment, there is a lot of development happening. It's important to continue to motivate growth while insuring that the necessary infrastructure is in place. City Council Work Session February 22, 2016 Page -2 - Council Member Swecker stated that the City's philosophy has always been that development pays for itself. Developers pass fees along to the purchaser; if those fees are reduced to where they don't cover the City's costs then existing homeowners who have already paid their connection fees incur the remaining costs. Council Member Davis agreed that deferral or financing of fees might provide incentives for development. Mayor Little clarified that his vision was to provide incentives for commercial/ industrial, including multifamily housing, to bring additional development, especially small businesses, to Lakeville. He believes that with Lakeville being the leader in single-family home building the last three years, residential development incentives are not needed. People continue to locate here for the many amenities including parks and schools. Park dedication fees were also discussed by the Finance Committee. Mr. Miller stated that a recent survey showed Lakeville to be comparable to similar cities and the fees to be adequate. Assistant City Administrator Kuennen stated that fees do not always correlate from city to city since cities collect and label fees differently. A survey completed by the Builders Association a few years ago provided some basic comparisons. Anderson believes it would be helpful to compare fee structures from a few cities of comparable size and growth rates. LaBeau believes it would be very difficult to get an accurate comparison because there are too many variables and factors. The key is for people to know upfront what they are paying for and what the cost is; they want to see a value for their dollar. Anderson believes it would be beneficial to go through the process of gathering information related to the comments and questions raised by the Finance Committee in order to be prepared to respond to future challenges. LaBeau doesn't want to put additional pressure on staff and suggested surveying the bigger developers again since they all work in multiple cities and are aware of each city's strengths. Mr. Miller met with several of them individually last fall and the general consensus was that Lakeville's fees were in the middle range and they appreciated that predictability. Ms. Erickson stated that the Finance Committee expressed the desire for the Council's philosophies to be better articulated and shared, especially whether Council believes development should be encouraged or discouraged. Mr. Miller had responded that Council wishes to encourage development in an orderly fashion. Mr. Miller proposed that staff prepare a basic summary of comparisons from a select number of cities and come back to Council with some options and ideas on water connection fees, etc. Anderson suggested the Council's philosophies and policies be put in writing. LaBeau stated that key issues that remain to be addressed are cost of maintenance on amenities and what benefits are gained by commercial development from park dedication fees. City Council Work Session February 22, 2016 b. Legal Services RFP Page -3 - Mr. Kuennen stated that per the established schedule for updating contracts for services staff has recently prepared draft RFPs for general legal services and auditing services. The tentative schedule is for contract approvals at the June 6, 2016 Council meeting. Staff is seeking input from Council on what they want their level of involvement to be in the review of the proposals: full council, personnel committee, etc. Bids will be for criminal and civil legal services and may include either one or both. Between five and ten proposals are expected to be submitted. The City is not obligated to award the contract to the low bidder. Anderson asked if the contract could include risk management in the section regarding advisor to Council committees and staff. After some discussion it was decided that the Council Personnel Committee will review proposals and bring a recommendation to the entire council for consideration. c. POST Tax Abatement/DEED Incentive Package Community and Economic Development Director Dave Olson stated that over the past several months City staff has been working with the State of Minnesota and Post Consumer Brands/ MOM Brands to finalize the agreements for the proposed incentives that were offered to Post to retain their headquarters in Lakeville. The City of Lakeville was awarded a $750,000 grant from Minnesota DEED to help with retention of employees at Post Consumer Brands. The City, DEED and Post have reached an agreement on the language for the documents requiring approval before the funds will be released. Terms for forgiveness of the loan include retention of 250 jobs with a minimum hourly wage of $18.48 for a period of two full years and Post's agreement to continue operations in the City of Lakeville for five years, through May 4, 2020. In addition, the City proposed an incentive of $375,000 to be provided to Post through Tax Abatement after the 250 jobs have been retained for one year, or May 4, 2016. Olson added that the number of jobs retained is now at about 280. Staff is recommending an interfund loan from the General Fund rather than the Liquor Fund as previously discussed in order to retain the Liquor Funds for construction of the fourth liquor store. The Fairfield Business Campus TIF District is scheduled to be active until 2022 so the loan will continue to accrue interest for seven years. Staff stated that this is the City's first long-term tax abatement and asked Council for direction on funding and repayment of the $375,000 loan. It was the consensus of the Council to establish interest on the loan at the prime rate of 3.5%. Council directed staff to proceed with a public hearing on Monday, March Th to consider both the DEED Minnesota Investment Fund Loan Agreement and the Tax Abatement Agreement. d. 172nd Street Construction/Design Update City Engineer Zach Johnson provided a conceptual design and a project update on 172nd Street near County Road 5. Staff has been working with Dakota County to identify a revised alignment City Council Work Session February 22, 2016 Page -4 - and short and long term plans for the CR 5 corridor. Staff continues to meet with property owners in the cul-de-sac prior to public meetings which will begin in a few weeks. Council Member LaBeau asked about the property owners who had attended the work session about a year ago. Mr. Johnson stated that meetings have been held with those property owners as well as a potential developer. Because this project will impact a county road, the county will participate in funding. Mr. Miller commended staff for working with some challenging issues on this project. Council Member Swecker asked if traffic signals would be installed at the intersection. Johnson stated that it would not be signalized as part of this project, but perhaps would be in the future. e. Possible Dates for Advisory Committee Interviews Council has indicated a desire to interview all applicants whose terms on various advisory committees are expiring. At this time there is also one new applicant to interview. After some discussion Council determined that members would be available prior to the March 7`h Council meeting. Interviews will begin at 4:30 p.m. on March 7. Mr. Miller stated that last year the two positions on the Cable TV Board were reappointed to terms that would expire when the franchise agreement is finalized. Council would like to give the two remaining Cable TV Board members similar reappointments. Mr. Kuennen added that the Cable TV Board will be revamped in the future when their work on the franchise agreement is finished. f. Advisory Appreciation Dinner Introductions Council determined which groups they would introduce at the March 15th appreciation event. Other Council Member Swecker announced the retirement of the DCC Executive Director. 4. Adjourn The meeting adjourned at 8:14 p.m. Respectfully submitted, i Hawkins, Deputy City Clerk Matt Little, Mayor