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

City of Bigfork

Special Meeting May 17, 2005

Members Present: Mayor Amy Tendrup, Jean Lexvold and Amy Pifher Absent: Bob Zimmer and Richard Salmi Also Present: Ron Bailey, Darrell Harwood, Gene Collins, Tim & Anne Collins, Julie Aakhus, Gene Madsen, Gene Rajala, Dave Waters, Warren & Caroline Welch, Gus & Marilyn David, Mark & Connie Maki, Joyce Holsman, Andy Shaw, George Custer, and Mike Caron

Mayor Tendrup called the meeting to order at 7:05 p.m. and stated that the purpose of the meeting was to discuss the city house and the municipal liquor store.

Tendrup stated that the City house issues had been left on the table at the last meeting and now the Council needed to decide what action to take.

Realtor Paul Hanson had contacted Storlie earlier in the day with another proposal for purchase of the City house. This proposal was for $22,000. Gene Rajala asked how much property was with the house and Tendrup answered that it had been subdivided and was just a City lot. The exact dimensions were not readily available. Anne Collins stated that if the City intends to spend $61,710.50 to install a sewer line to the property, how they could justify accepting a bid of $22,000 for the house when it was appraised for $65,000. Tendrup clarified that $61,710.50 is the estimated cost for the total project of providing sewer service to both the City house and the Rajala house. Of that amount, the City would be responsible for $40,111.85 and each of the two properties would be assessed $21,598.67. Ron Bailey questioned if the current septic system servicing the City house is acceptable for use until such time as the City would put in a municipal line. Maki stated that an inspection of the system had not been done to determine if it is compliant or not. Gus David asked if the sewer system is to be updated before the property is sold. City Attorney Andy Shaw answered that the property will be sold “as-is” and anyone buying it should understand that they will be required to hook up to City sewer if it becomes available. Gene Collins asked if the $21,598.67 assessments would be paid over a period of time and Shaw answered that they would be. Gene Rajala wanted to know if other property in the area was developed, causing more people to have access to the City sewer, who would pay for it. Shaw explained that property is generally assessed by front footage and if property was developed after the original assessment, it would not incur a new assessment. Dave Waters stated that if the Rajala house was hooked up to the current line running to the Lutheran Church parson, there should be no assessment since the City did not pay for the parsonage line. Shaw stated that assessments would be done to cover costs incurred by the City for providing sewer service and if new lines were necessary to hook up the house, it would be assessed. Shaw also pointed out that this project is not approved and may not materialize. It is possible that the City will not provide municipal service and the property owners will instead be required to bring their current systems into compliance. Maki clarified that this is necessary because of their proximity to a municipal well that the City has been trying to get on line for quite some time. Anne Collins asked why these issues were not addressed when the well was drilled. Maki explained that the city engineer at the time did not apply for the proper permits from the State. Gus David added that was one of the reasons why the City hired a new engineering firm. Shaw returned to the discussion of the proposal before the Council. He stated that it is difficult to justify selling a piece of property for $22,000 when it was appraised for $65,000. He conceded that things have been discovered since the appraisal that may affect the value of the property and suggested that perhaps a new appraisal should be done. A motion was made by Pifher and seconded by Lexvold to reject the bid, Motion Carried Unanimously (MCU). Ron Bailey asked if the house would be sold by public bid. Tendrup stated that the City’s contract with the realtor ends on May 31, 2005 and at that time the Council will have to decide whether or not to re-list with them. Shaw recommended hiring a different appraiser to do a new appraisal of the property and then calling for public bids on the property using the appraisal to determine a minimum bid. Motion by Lexvold, seconded by Pifher to order a new appraisal of the property, MCU. It was determined that a decision would be made on whether or not to put the property out on bids or keep it listed with the realtor after the new appraisal is received.

Tendrup moved on the issue of the municipal liquor store. She stressed that the Council wished to hear comments on whether or not people were in favor of the Council making changes in the operation before the June 7, 2005 election. She stated that she had been contacted by many concerned residents and business owners who were of the opinion that if action was not taken, the operation would be voted closed. Gene Collins wanted to know how much the liquor store had the City in debt. Tendrup replied that the City is not in debt and that the liquor store lost approximately $16,000 in 2004. Tim Collins asked if depreciation was included in that $16,000 and Tendrup answered that it was. He then asked why a four percent raise was given when it was losing money. Tendrup stated that the Council has already answered these questions at the public hearing and was now asking to hear comments about whether or not to take action before the June 7th election only. Gene Madsen was next to address the Council. He stated that he realizes the Council has been put in a precarious position due to the upcoming vote. He feels that the liquor store can and should net forty to sixty thousand dollars a year but changes have to be made. He reminded the Council that a lot of money is needed for projects in the City and one way to get these funds is through the municipal liquor store. He suggested that the Council do like the City of Littlefork has done and eliminate the liquor store manager position in order to save money. Anne Collins stated that this issue has been discussed quite heavily for the last four months and the Council has not acted on anything and has not given answers to the questions of the residents. She feels that if it closes, the building should be sold and the money used to provide for the needed projects. She further stated that the Council has been given the opportunity many times in the past to make changes and they have not acted on them. Mike Caron stated that he agreed with Madsen. Something has to be done with the operation and if it doesn’t make money, it’s no good. Shaw asked if the Council saw anything they could do in order to better the operation. Tendrup stated that the Liquor Store Commission had suggested a few months ago that the operation be changed to off-sale only. The Council had asked for a formal approval on this from the Commission but it was not received. From the comments she has heard, Tendrup fears that if the Council does not take action to make changes in the operation, it will be voted closed. However if the public sees that the Council is working to improve things, they may vote to keep it open. The comments she has heard suggest closing the on-sale portion of the operation, eliminating the liquor store manager and bartender positions and running an off-sale only facility with part-time sales clerks with one head sales clerk in charge. Connie Maki asked if this were to happen, could the City lease out the unused portion of the building and Shaw stated that they could. Gene Collins did not feel that having just off-sale would work. You would still have the building and would not be collecting for taxes or water and sewer on it. Gene Rajala felt that if no action is taken, the operation will get voted closed. If radical changes are made, it is possible that it will stay open. He stated that the Council must bite the bullet and make a decision. Tim Collins asked if it was voted closed, could it ever be opened up again. Shaw stated he was unsure of the statutory allowances on this but that it did not make sense that if the electorate voted an operation closed, the Council would try to open it up again. Gus David pointed out that though the liquor store lost $16,000 last year, the community gained about $18,000 through grants from the Lion’s Club that are funded by pull tab sales at the Picaroon and other facilities. Shaw asked if the Picaroon were closed is there an alternate location for pull tab sales and it was stated that there is. Pifher pointed out that the $18,000 David was referencing does not affect the bottom line of the liquor store fund. David agreed, but argued that it is an indirect benefit to the community. The Council discussed the closing of the on-sale portion of the facility. If this were done, the positions of liquor store manager and bartender could be eliminated and replaced with part-time sales clerks. Pifher was in favor of trying to keep the on-sale portion, however Tendrup pointed out that if we do, we still need the liquor store manager and bartenders. The only way to cut costs is to move to an off-sale only and eliminate those positions. Shaw inquired if City Personnel Attorney John Licke had been contacted regarding eliminating positions and he was informed that he had. Anne Collins felt the Council was stumbling along with not all members present and trying to put something together at the last minute. Gene Madsen pointed out that there was a quorum of the Council present and they have the right and the obligation to take action. Gus David asked if this were done, who would be in charge of ordering. Tendrup stated that there would have to be a lead sales clerk in charge of ordering, scheduling, etc. She pointed out that other cities have used the City Clerk for assistance with these items and, if needed, have used an assistant to the Clerk and still saved money. Connie Maki asked if this were done, would the current employees still have their jobs, or the new jobs. Tendrup stated that the old jobs would be eliminated, new jobs would be created, and, according to City policy, the new jobs would be posted and interviewed for and that current employees would be eligible to apply for them. Tendrup called for any last comments on the issue and there were none. Motion by Pifher, seconded by Lexvold to close the on-sale portion of the municipal liquor store operation, eliminate the liquor store manager and bartender positions, and move to an off-sale only facility with part-time sales clerks and one lead clerk within the next six months, MCU.

Mayor Tendrup adjourned the special meeting at 8:01 p.m.

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.