DRAFT – These minutes are not official until approved at the next regular City Council meeting.

City of Bigfork

Regular Meeting June 14, 2005

Members Present: Mayor Amy Tendrup, Jean Lexvold, Bob Zimmer, Amy Pifher and Richard Salmi Absent: None Also Present: Ron Bailey, Tarry Edington, Caroline Welch, Mark Maki, Gus & Marilyn David, Joyce Holsman, Warren Welch, Dave Waters, Julie Aakhus, Gene Madsen, Gene Collins, Gail Johnson, Gwen Olson, Carol Pifher, Mark Jackson, Mike Bakke, Chet Cook, Robin Custer, Virginia & Nathan Hale, Dave Schminkey, Albert Tendrup, John McCann, Jon Babcock, John Licke, Andy Shaw, Gene Rajala, Erin Johnson, Travis Mount, Sue Zamora, Julie Kennedy, Jon Hoskins, Clarence York, Frank Roth, Connie Maki, and Patrice Jensen

Mayor Tendrup called the regular meeting to order at 7:00 p.m. and announced the results of the May 10, 2005 closed meeting. At the meeting, performance evaluations of Librarian Marilyn David and Bartender Cathy Schumacher were conducted. David received 37 out of 45 points on her review and was presented with an award and certificate for 10 years of service to the City. Schumacher received 30 out of 45 points on her review.

Consent Agenda Motion by Zimmer, seconded by Lexvold to approve the consent agenda as follows: #1- approval of the minutes of the May 10th special meeting, May 10th regular meeting and work session, May 17th special meeting and May 25th special meeting #2- approval of the Police Report for May 2005, report is attached to the minutes as Appendix A #3- approval of the library report for May 2005 #4- approval of the May 2005 budget report, copies of report are available at the City Clerk’s Office #5- approval of the Public Works Department report for May 2005, report is attached to the minutes as Appendix B #6- approval of the City Clerk’s Office report for May 2005, copies of report are available at the City Clerk’s Office #7- approval of Resolution 06-14-2005 (1): Requesting Sale of Tax Forfeit Property #8- approval of Resolution 06-14-2005 (2): Accepting BWC Donation #9- approval of Resolution 06-14-2005 (3): Accepting Recreation Donations #10- approval of Resolution 06-14-2005 (4): Accepting Banner Donations #11- approval of Resolution 06-14-2005 (5): Accepting Fire Department Donation #12- approval of Resolution 06-14-2005 (6): Approving Submission of E-Commerce Ready Certification Application #13- approval of land use permits for Peter Taylor for a shed, George Hauck for a wood shed and lean-to and Barb Chase for a deck (copies of all resolutions are available at the City Clerk’s Office) #14- approval of the claims for payment in the amount of $69,773.00 including the May 13th and 31st payrolls Motion Carried Unanimously (MCU).

Mayor Tendrup wished to make a statement at this time. She stated that it has come to her attention that some residents of the City are concerned with the pace and manner in which projects are being done. She reminded residents that all complaints and concerns need to be addressed to the Council and that it is not appropriate to complain to City staff or appointed representatives such as the City Engineer or Attorney. She ended by stating that the City staff and representatives are working at the direction of the Council and have been doing a fantastic job and that the City will not allow harassment of its employees.

OLD BUSINESS:

Tarry Edington: Tarry Edington was present with a request that the Council reaffirm the previously stated position of endorsement and support of the proposed WilderNest housing development. Itasca County Housing and Redevelopment Authority is again applying for funding for the project and needs an updated resolution from the City. He briefly reviewed that WilderNest is a 12-unit multi-family housing facility that they have been working on for over three years now. He reminded the Council that part of the resolution states that the Council will consider creating a Tax Increment Financing (TIF) district to provide capital funding to the project in the amount of $99,000.00. He reminded the Council that they had previously talked with their financial advisor, Northland Securities, about taking out a bond to provide this money to the project. The bond would be repaid with the increase in the tax base of the property created by its development. Salmi voiced his concern that the City could not handle any more debt. Edington reiterated that the bond would be a revenue bond, not a general obligation bond and would be paid back solely by the increased taxes from the property. Zimmer clarified that the TIF district and bond would cost the City nothing and was simply a way to provide up-front funding needed by the project. A lengthy discussion ensued regarding sewer pond capacity and ability to support this development. City Engineer Julie Kennedy commented that the City has been working on this issue for over a year and has achieved significant reduction in inflow and infiltration (I&I). She felt that the fixes that have already been made will be sufficient for the WilderNest housing development to be allowed to connect to the system. Salmi wanted to know if it would be necessary to dredge the ponds or if we can fix the problem with decreased I&I and the use of enzymes to eliminate sludge in the ponds. Kennedy stated that the best way to help the problem is to educate the public and create accountability to help stop excessive water usage. The next thing to do is to continue working on I&I reduction by plugging holes in manhole covers, fixing leaks as they are discovered, and eliminating any storm sewer outlets that may empty into the system. After that, enzymes could be used to reduce the amount of sludge in the ponds and increase its capacity. Dredging would be a last resort option if the enzymes were not effective enough to rid the pond of enough sludge. Salmi stated that the City of Nashwauk has a sewer pond that was built about the same time ours was redone and they only have six inches of sludge. Kennedy attributed that to a good ongoing maintenance program and stated that once we get our current sludge level down, we will be able to control it with regular maintenance. Kennedy pointed out that these issues were identified as problems back in 2000 in a report by the City’s engineer at that time and no action was taken to resolve them. Salmi asked Kennedy if she had any idea of the cost of dredging the ponds. Kennedy gave a ballpark figure of $700,000 and restated that use of enzymes could reduce that cost. Salmi asked if there was any grant money available for this and Kennedy stated that this project is included in the application to Rural Development for funding. She reminded the Council that before we are eligible for grants, we need to have our water and sewer rates up to the minimum required by Rural Development which is 1.7% of the median household income, or $35 for each utility, whichever is greater. Gus David wanted to know if the rates could be raised in order to get the grants and then lowered again afterwards. Kennedy stated that she had never seen that done, but it was logical. The grant money would be used to improve the system which should reduce the costs associated with it and the rates could then be lowered. Salmi was concerned that the Council was moving too fast on these projects. Tendrup commented that these are necessary items that need to be addressed and the City has no choice but to deal with them. Kennedy added that if the City wants to invite housing and other development into the City, these problems need to be fixed so that we can support that development. Salmi asked if there was a way to increase water and sewer rates for those areas such as the hospital and school that do not pay taxes. Kennedy said that some cities have different rates set for commercial versus residential users. There were questions from the audience about what would happen if the housing project were built and then it was found the pond could not support it. Edington stated that would not happen. The project needs to apply for a connection permit from the Minnesota Pollution Control Agency and if this permit is not granted, they would not build. Kennedy restated that she feels it would be granted based on the I&I reduction that the City has already completed. Zimmer felt that the Council had agreed many months ago to support this project and to consider the TIF district and now was simply being asked to update the documentation on that. He made a motion to pass Resolution 06-14-2005 (7), seconded by Lexvold, MCU.

Julie Kennedy: Kennedy had a few other items to address with the Council. She stated that she had contacted Mike Larson at IRR after Salmi’s comments that there may be money available there. Kennedy was informed that IRR has eliminated their community and economic development program which is what previously funded infrastructure projects. At this point, any request for funding to them would be a letter or personal contact to the commissioner. Larson stated that any monies awarded would come out of their discretionary funds and that they had provided funds to a medical facility in this capacity in the past. Kennedy stated that the Council would need to decide if they wish to request funds from IRR, and if so, for what project(s). Tendrup asked Kennedy what she thought the biggest need was at this time and Kennedy answered that it was the pond capacity issues as discussed earlier in the meeting and an access road to the ponds. That said, Kennedy referred to a letter from Father Steve Daigle of Our Lady of the Snows Catholic Church. The letter stated that the church will not be selling any land to the hospital. They suggest that the existing boundary between the church and hospital property be used as the location for a new access road for the City and possible relocation of the forcemain. They realize that this would require building through a wetland and are requesting a cost difference between doing it this way and a possible different route to avoid wetlands. The church is interested in helping the City. Kennedy informed the Council that the current road will serve our day-to-day needs for access and there is a possibility of using a temporary haul road through church property if and when heavy equipment needs access to the ponds. Gus David asked if the ponds could be dredged in the winter so that heavy equipment could get to them across church property without having to build a road. It was pointed out that the hospital may not be interested in contributing financially to this project if they are not able to get the land they desire from the church. David thought it was in the hospital’s best interest to assist anyway because now, every time they add on, they have to move the forcemain and it would be best to get it off of their property entirely. A motion was made by Pifher and seconded by Zimmer to direct Kennedy to research the different options in this situation and report back to the council at the next regular meeting, MCU.

Kennedy’s next item was the final plat of Scenic Estates by Legacy Development. The Planning Commission is recommending approval of this. Nothing has changed since the preliminary plat was approved at last month’s meeting. Salmi wanted to know what this will cost the City and Kennedy explained that it will cost nothing. Legacy is proposing to do a pay-as-you-go TIF district. This means that they, as the developer will be responsible for the cost and will get a portion of their investment back through the TIF revenue. Motion by Zimmer, seconded by Lexvold to approve the final plat, MCU. Kenndy then recommended that a meeting be set up with Legacy and Northland Securities to discuss the TIF financing. This meeting will take place on Monday, June 27, 2005 at 10:00 a.m.

Kennedy’s final item was the proposed zoning ordinance. She explained that the Planning Commission has been working for many months to put together a new zoning ordinance for the City. She provided copies of the ordinance and stated that the Council would need to call a public hearing on the item before it is passed. Tendrup added that she feels the Planning Commission has come up with an ordinance that will fit the needs of our City and that everyone can live with. The Council discussed scheduling two Council meetings per month. A motion was made by Zimmer and seconded by Pifher to meet on the 2nd and 4th Tuesdays of the month at 7:00 p.m., motion carried with Salmi opposing. It was determined that the Council would review the proposed ordinance and come back to the July 12th meeting with questions. They will then call a public hearing for July 26th to hear public input on the ordinance.

Pifher Water Leak Letter: Because of potential conflicts of interest, Amy Pifher and Amy Tendrup removed themselves from discussion on this item. Acting Mayor Bob Zimmer took control of the meeting. Zimmer read a letter that the Council received from Bill Pifher regarding a water leak that occurred. Public Works Superintendent Mark Maki arranged for Casper Construction to repair this leak because it was causing a possible contamination hazard. Much discussion took place regarding who paid for the original installation of the line, who was assessed and who had been provided service. Shaw stated that regardless of who had paid for what, the leak occurred, Maki proceeded in the best manner possible, the City has already paid the bill for the repair, and he recommends the City keep responsibility for the bill and amend their ordinance so that this situation does not happen again. He explained that the City’s ordinance does not specifically state where the City’s responsibility ends and the property owner’s begins. Salmi felt the two property owner’s should negotiate the cost of the bill between them. Shaw restated that our ordinance does not support this and it needs to be amended. He again recommended the City keep responsibility for the bill and amend the ordinance. He stated that the other option would be to take the property owners to small claims court over this issues and this would end up costing more that the original bill was for anyway. Lexvold made a motion to keep responsibility for the bill and to amend the ordinance. The motion failed for lack of a second.

Engineer RFQ Review and Selection of Engineer: Storlie explained that as part of the Rural Development grant application requirements, requests for qualifications were sent out for engineering services. The interviews that the City conducted a year and a half ago to select a new engineering firm could be used as the basis for selection for RD as well. Storlie recommended hiring Short-Elliot-Hendrickson as engineer. Motion was made by Zimmer and seconded by Lexvold to do so, MCU.

As approved by the Council, the Fire Department has called for bids on a new fire engine. A special meeting needs to be set to open the bids. The Fire Department is requesting this meeting to be set for Monday, July 18, 2005 at 7:00 p.m. Motion to set the meeting as requested by Pifher, seconded by Zimmer, MCU.

NEW BUSINESS:

Canvass and Certification of Special Election Results: Mayor Tendrup opened the official results of the special election and read them. 220 people were registed as of 7:00 a.m. on election day. Two new registrations were received. 133 people voted by mail in the election. Seven ballots were received with no signature. The ballot question asked “Shall the City of Bigfork continue operation of the municipal liquor store?” 55 voted “yes” and 78 voted “no”. A motion was made by Salmi and seconded by Pifher to certify the results of the election, MCU. City Attorney Andy Shaw stated that the Council must choose a date of closure for the operation and that date must be no more than 30 months from the date of the election. Zimmer asked what had to be done prior to closing the operation. Shaw stated that the primary responsibility would be to the employees and asked City Personnel Attorney John Licke to comment. Licke stated that typically you would want to give early notice to employees and allow for some sort of severance pay program. Liquor Store Manager Joyce Holsman had prepared a severance pay proposal for the City. She asked for payment of 30 vacation days, seven sick days, and all of her accumulated flex hours for April, May and June. Licke reviewed that the City’s personnel policy does not allow for payout of sick or flex time and calls for payout of ½ of unused vacation time. He stated that if the Council wishes to offer severance pay, they will need to make a motion to create a special pay program for this specific situation. Gene Madsen asked if the Council had talked about what will be done with the building. Tendrup felt that it needed to be taken one step at a time and returned to the issue of setting the closing date. Zimmer felt that since Salmi was one of the proponents of the petition calling for the election in the first place, maybe he had the solution. Salmi stated that the doors should be closed in two weeks. Licke suggested that once the employees know the closing date, we may not be able to keep enough help to operate the facility as they will be looking to move on. Holsman and Bartender Marilyn David both expressed that they did not wish to work any more under the current situation. Shaw suggested that if that is the case, the City should shut it down immediately so that the employees unemployment benefits would not be affected. Zimmer asked if Holsman and Marilyn could get any loose ends wrapped up tomorrow and they stated that the could. A motion was made by Zimmer and seconded by Pifher to cease retail sales as of noon tomorrow (June 15, 2005) and to allow up to two weeks for the employees to work on inventory, clean up etc. and for Amy Pifher and Jean Lexvold to help with inventory this Thursday (June 16, 2005) at noon, MCU. Tendrup returned to the issue of severance pay. Storlie informed the Council that Holsman will receive 15 days worth of vacation pay no matter what is decided regarding severance pay since this is what our policy calls for. A motion was made by Tendrup and seconded by Lexvold to pay 15 days worth of pay for each of the two employees at their regular rate of pay for severance pay, MCU.

City Library: Marilyn David has reported that fewer and fewer people are using the library. Also, the regular users have already read all of the books available and we don’t have the budget to purchase a lot of new books. David is recommending that the library be closed effective immediately. Motion was made by Zimmer and seconded by Lexvold to repeal ordinance #52, establishing a public library, and to discontinue library operations effective immediately, MCU. Anyone with library books checked out should return them to the City Clerk’s Office. Ron Bailey noted that the VFW would be interested in renting out the library space. This issue will be referred to the Planning Commission.

Personnel Committee: It has been suggested that the personnel committee be formed to handle performance reviews and other personnel issues. This would save time at Council meetings. The issues was tabled.

Conditional Use Permit: A conditional use permit application was received from Delores Harvey to allow for a retail sale facility on her property located in an agricultural zone. This item was referred to the Planning Commission.

Mark Maki: Maki had several issues to address. The first was price quotes for lift station repair and repairs to the airport runway. Maki has secured assistance with the cost of the airport repairs. Maki next requested permission from the Council to sell the swimming raft. For liability reasons, we are not allowed to put it out at the beach and could get a decent price for it. A new raft of the same size and make runs about $4500 plus $200 each for the two ladders. Motion was made by Zimmer and seconded by Lexvold to sell the raft by sealed bids with a minimum bid of $2500 and to open the bids at the July 12th Council meeting, MCU. Maki reported that they lost a lawnmower last week and it will cost around $1,000 for a new motor. He will be getting price quotes to compare the cost of a new machine with repair costs for the old one. This will be included in next year’s budget. On a personal item, Maki requested an extension on his building permit for his roof project. Motion by Zimmer and seconded by Lexvold to extend the permit until the project is completed, MCU. Maki also asked permission to have his property replatted in order to save on the cost of flood insurance. This item was referred to the Planning Commission.

Wanigan Display: The Council has already approved Gene Madsen to build a Wanigan to be placed at the Kiosk. Madsen would like to collect donations to cover the cost of this project and is asking the City to act as fiscal agent so that donations can be made. Motion by Pifher, seconded by Lexvold to act as fiscal agent for the project with the understanding that no funds other than donations made specifically for this purpose are to be used, MCU.

City Office Hours Review: The Council had scheduled a review of the Clerk’s Office hours at this time. Motion by Pifher, seconded by Salmi to set the office hours at 8:00 a.m. to Noon, Monday through Thursday, to be reviewed again in 90 days, MCU.

OTHER BUSINESS:

Gail Johnson and Gwen Olson were present representing the Bigfork Wilderness Celebration Committee and expressed their thanks for all the time and help given them by Mark Maki, Dave Water, Angie Storlie and Jon Babcock for the celebration. The Council thanked Johnson, Olson, and the rest of the committee members for their contributions as well.

Jon Babcock wished to state that he would like it noted that Joyce Holsman has been a faithful employee of the City for over 20 years and, while there have been problems the last few years, he hopes that people will remember all that she has done for the City. People have made remarks against her at meetings in the recent past and that is uncalled for. The Council should remember that whatever happens to the liquor store after this, Holsman played a big role in making the money that will be made by the lease or sale of the facility.

Salmi asked if the yard at the City house could be mowed and Maki stated that it would be once it is dry enough.

Salmi asked if the snowmobile club could be contacted to repair damage done to the bridges. Storlie will check into who is responsible for this. Maki added that he is looking into recreational grants that are available for trails, bridges, canoe landings, etc.

Babcock reminded the Council that there had been talk about moving the gate at the beach out to the road. He has had some problems in the area and asked when the gate will be moved. Maki will work on it this week.

There being no other business, Mayor Tendrup adjourned the meeting at 10:05 p.m. and announced that a closed meeting would be held immediately for a performance review of Public Works/Maintenance Worker Dave Waters.

Angie Storlie City Clerk

These minutes are available on the City website at www.cityofbigfork.com. To sign up to receive the minutes by email, send your email address to ctyclerk@bigfork.net.

Appendix A

Bigfork Police Department Police Report May 2005

14 19:44 domestic argument/adults 15 09:12 natural death/male adult 18 11:08 possession of drug paraphernalia Obstruction of the legal process 20 16:20 criminal damage to property

Appendix B Public Works Department Report May 2005

§ Flushed 14 hydrants out of 45 – 3 needed repairs § Mark hydrants on map for Fire Dept. § Stop hydrant flush due to water leak, Division North § Tried to repair chlorine pump at water treatment plant, took apart, replaced bearing, no good, approached Council about new purchase § Met with MN Rural Water on pumphouse, ponds § Notified MPCA excessive total suspended solids for discharge, give OK to discharge from Ben Weinner § Work on water leak with Casper. Parts stripped by Casper back tomorrow to fix, cost adjustment to reflect excessive time charged due to problem, $300 credit § Savich Station, again a problem, awaiting short term financing to fix (new controller) Pumps set on 1-2 operation to work § Patch road with cold patch § Pick up road and street, ditches, lots of debris § Major rain, excessive I&I, check pumps main lift station § Thein Well called off due to water in park, damage to grass, road bad § Fit plugs for manhole covers § Work on pump at ponds, would not start, no power to injection pump, bad connection § Assist with tent for kids fishing day § Work on celebration set-up, cones, barricades, picnic tables § Mow all areas of town, cemetery mowed, started weed trimming around stones, lots of rain & standing water § Skag mower blowing oil out front of motor, approach council on repairs, exchange § Find funds for Airport runway repair, set up with Ferguson on patching, verbal approval of funds $2500, Patching $3200 § Samples from Airport mound system to N.T.S. for phosphorus problem, MPCA ruling

Wastewater 2,414,000 Water 1,750,000 I&I .664000 Snow/Rain 4.8”

Chemical Usage Pot. Perm 11.75 @ $2.1536 $25.30 Flouride 8.1 @ $.4396 $3.56 Caustic Soda 10 @ $4.18 $41.80 Chlorine 14 @ $1.2569 $17.60

Backwash Water Indication water 463 gal Backwash 13.500 gal

Trucks Gallons Cost Miles White 46.3 $95.00 101 Green 58.4 $146.00 596.3