January 20, 2015 Council Minutes








JANUARY 20, 2015 – 7:30 PM





  1. CALL TO ORDER – Mayor Williamson called the meeting to order at 7:30 p.m.
  2. ROLL CALL – Horton, Bren, Hughes, Williamson.
  3. INTRODUCTIONS – Williamson introduces the council and staff to the public. Administrator Tolsma, Attorney Beck, City Planner Brixius, Ehlers Advisor Bruce Kimmel, Planning Commissioner Mason.
  5. ADOPT AGENDA – Williamson wants to add under Number 15, New Business, item b. to appoint a member to the LMCC. Hughes moves adoption of the agenda as amended and Horton seconds. All votes ayes, motion carries.
  6. ADOPT CONSENT AGENDA – Bren moves to adopt and Horton seconds. All votes ayes, motion carries.
    1. City Council Regular Meeting Minutes from January 5, 2015
    2. Administration Committee Minutes from January 13, 2015
  7. PUBLIC FORUM – No one.
    1. Resolution 15-08: Resolution Providing for the Sale of General Obligation Bonds – Williamson said Kimmel will explain bonding for arranging for the finances of the city.




Kimmel thanks the council and staff and said he’ll be referring to the presale report.  Kimmel said he’ll describe terms and conditions of the bond issue.  He said bids will be taken and he’ll return in about a month to award the bond.  Kimmel said the presale is important to answer questions and not have any surprises at the sale date.  Kimmel said the bonding is for four different financings.  He said the city can issue GO bonds for each purpose and it makes financial sense to roll them into one bond issue.  He said there will be four separate debt schedules for ease in repaying. Kimmel said the four purposes are the street light project for $500K of financing, $400K for lift station improvements (sewer revenues) $606K for stormwater projects and $254K for the street improvements of West Arm Rd East (WARE) paid with special assessments in part.




Kimmel said the statutory authorities will all be general obligation with the city pledging faith and credit and equipment certificates He referred to Chapter 444 for utility bonds for the lift station and stormwater and Chapter 429 is the special assessment for over 20% for WARE without referendum.  He said the bonds are being issued for 15 years for stormwater and lift station.  The capital improvement has a ten year amortization and the WARE improvement is ten years.  He said the debt service is being combined. 




Kimmel said bond investors care about credit ratings. He said if you issue less than 10 Million, it’s bank qualified.  Kimmel said it’s a better benefit for interest exemption and tax benefits to buy the bonds.  Ehlers said Spring Park has an exceptional credit rating at AA+. He said it’s a reflection of prudent fiscal management. Kimmel said with competitive sale they don’t know who will buy the bonds as it can be community banks, institutional investors or individual investors.  He said they expect competitive bids.  Kimmel said they recommend competitive sale to the full offering of networks.  He said with the underwriter’s discount it works out to $22K. He said this is just an allowance and each bidder will decide what to take.  He said when calculating the bid they won’t know if the bidders have taken all or some of it. He said what’s considered at the time of sale is the Interest rate bid and the discount. Kimmel said this gets worked out in the end. If there is unused discount the city would like to reduce the bond amount by that number and that is allowable. Kimmel also wants to speak about premium bidding and with interest rates being so low investors feel they have a better shot of attracting investors if there is a higher coupon or face value.  He said for a premium bid, as an example and looking at the debt service schedule, there are estimates of yields ranging from .8% (2016) to 3.4% (2030).  He said these are slightly inflated.  Kimmel said depending on the sale date instead of .8 it might be 2% and varying through the years.  He said what is done is they want higher coupons so they’ll pay higher for the bond offering.  He said if there is a premium bid, the bond amount can be reduced to the right amount of project funding needed.  Kimmel said they continue to look at outstanding debt and there isn’t much.  He said there is the limited disclosure obligation to file material event notices.  He said Ehlers contracts with the city to file on the city’s behalf. The same with arbitrage rebate even though there is nothing to report, the IRS requires it. 




Kimmel said regarding risks on the WARE project, the assessments are relatively low but if there are a significant amount of prepayments received, excess assessments could be reduced by reducing the levy in the given year.  Kimmel said they will need to maintain utility funds and rates. He said other service providers are involved, such as Briggs and Morgan, Bond Trust Services and Standard and Poors.  Kimmel said the schedule is on page four for presale and the official statement to the market is the first week in February along with a special meeting in February to award the bids and an estimated closing date of March 12th.  Kimmel said there are a number of exhibit pages included in the packet.  Kimmel said based on what was done with the last improvement project, assessments are paid over five years but the city’s levy is payable over ten years. 




Williamson notes when referring to using the sewer fund interchangeably with storm water he said they are funded differently and he wonders if they should be clarified as such.  Kimmel said Chapter 444 is the only mechanism available and said it comes from either water and/or sewer.  Williamson wonders about legal or fiduciary impropriety.  Kimmel said he thinks there are solutions to this in the form of transferring money from various fund accounts.  Williamson also asks about arbitrage.  He said the city has adequate funds to cover cash flow and emergencies.  He said there is about 1.5 million available for capital programs.  He said this bond issue is to restore money that has been drawn down for projects.  He said there is concern on arbitrage calculation that this doesn’t include the City’s money.  He wonders if this can be kept separate. Kimmel said the bond proceeds for reimbursing other city funds will be noted as such. 




Hughes asked about special assessments and the assumption that amount will be paid.  Hughes wonders about when senior citizens opt out of increased property taxes and pay when they sell their property. Kimmel said if assessments don’t come in as projected, the city’s levy would be increased for those years.  Kimmel said as a requirement of state law there is an amount of 105% of total and state law said for levy contribution there is a requirement of levying 105%.  It artificially inflates the levy contribution.  Hughes moves to adopt Resolution 15-08 and Bren seconds.  All votes ayes, motion carries.




    1. Resolution 15-09: Resolution of Support for WeCAN –


Williamson said this has been adopted for the last several years.  He said this is an allocation of community block grant money and does not represent a draw on the City’s funds.  Horton moves to adopt Resolution 15-09 and Hughes seconds.  All votes ayes, motion carries.




    1. Ordinance 15-01: Manufacturing District Amendment – Williamson said there is a proposed ordinance and City Planner Alan Brixius will discuss.


Brixius said there are two ordinances in front of the council, one being marked up and one being a clean copy.  Brixius said this was prompted due to various businesses setting up in the large Tonka Business Center that aren’t proper uses of the zoning district. He said the city often doesn’t find out about this until the new business asks for a sign.  Brixius said the comprehensive plan describes long term ambitions of mixed use, commercial and perhaps even residential.  Brixius said in the future, manufacturing might be obsolete for this area of Hennepin County. He said a parking concern comes with the introduction of these future uses so therefore they are looking to add a provision for allowing enclosed retail sales and rental services, totally contained within and allowing for adequate off street parking. He said wall signs would be allowed only for exterior tenant bay and for exterior entrances.  He said the other option is if the property owner would come in with a comprehensive sign plan showing a clean and clear allocation of signage for each potential tenant. 




Brixius said an examination has been performed for adequate parking.  He said there haven’t been any issues to date.  He said there is parking along Spring Street, the east side of the building, the large parking lot along Shoreline Drive, the internal lot between the buildings and parking on the west side.   Brixius said they’ve tried to set up performance standards.  Williamson asked about exterior walls, specifically he wonders about the rear side facing the trail. Brixius said signs are only allowed facing a public street.  He said if the property owner wanted to provide a comprehensive sign plan, the city could provide flexibility.  Williamson wondered about businesses on the inside courtyard for suppliers making deliveries.  Brixius said signage is specific to retail sales and rental uses and it doesn’t affect manufacturing. He said it’s specific for new businesses coming in.  Hughes wonders about business licensing as this has been discussed for a long time.  He said he worries more about traffic generated for sales type of things and parking needing to be managed. Brixius said currently Tonka Ventures exists as three different parcels.  He said the east parking lot is a separate PID and there is no linking it to the other properties.  He said he wants this linked in order preserve parking.  He said if Tonka Ventures is relying on the east parking lot, there has to be something tying those properties together.  He said it needs to be formalized with an easement or something. 




Williamson said normally when they have a proposed ordinance in front of them it accompanies the Planning Commission minutes and their recommendation so he’s reluctant to move forward without that documentation.  He would be more comfortable supporting laying this over.  Brixius said there isn’t any deadline on this so holding it over isn’t an issue.  Hughes said he wonders about inspecting this building.  He wants to make sure there is proper uses going on for what it’s zoned.  Brixius agreed that they’ve talked about a workshop with the PC to discuss this going forward.  Hughes thinks it’s important to at least have information regarding contacts, what is the proposed use and if it meets proper code.  Brixius said he thinks it’s important to involve the building inspector and perhaps fire chief in order to establish guidelines for requirements.  Williamson makes a motion to lay this over until the next regular meeting on February 2nd.  Horton seconds.  All votes ayes, motion carries.




    1. Mayor and Council –


  • Williamson said Hughes will no doubt have a further report on the quiet waters proposal in front of the LMCD and there is a meeting tomorrow of the public safety committee at 3 p.m. He said there is a special meeting of the LMCC for this Thursday for an executive session taking up a human resource/legal issue. He said the police commission has published their quarterly meetings. Williamson said Metro Cities are monitoring proposed legislation affecting cities and he notes Senator Osmek is authoring a bill to change appointment and provide for removal of members of the Met Council.

  • Hughes said there is a proposed new law regarding trailering a boat that requires an internet test and a sticker on the boat trailer. He believes this needs more work and is not in favor of it at this time. Hughes said in regards to quiet waters, he amended a motion to separate the two areas being proposed for quiet waters and it was approved. He said the purpose of tomorrow’s meeting is to decide to make a recommendation or bring it back to the board to continue on the issue. Williamson wonders if this is regarding safety or is it also environmental for high waters. Hughes said this is for the public safety part. Hughes said there is a fire commission meeting scheduled for tomorrow. Hughes said the LMCD had a workshop looking at the five year plan for goals and objectives.

  • Horton wonders if it’s too early to talk about the plantings. She said for the planters on the median, she wonders about color. Bren agrees that there was color last year. Hughes said he knows an issue is heat, growing conditions, etc. Williamson said his complaint has been for what is spent, when compared to Excelsior and Wayzata, our plantings tends to be dark. He likes what’s done in front of Lakeview Lofts and Pres Homes, things that are colorful. Hughes thinks it would be a good idea to invite Norling to a workshop to discuss. Williamson requests Tolsma to check with Norling about the February workshop.


      1. Zoning Verification Request Discussion –

        Brixius refers to the handout and it’s a request for a MN Dealers’ license at 4388 Shoreline Drive, Pat O’Flanagan’s building. Brixius said he doesn’t feel comfortable signing off on this request. He said the building was originally built for an office building, it’s been used for marine sales, a school, outdoor sales with conditions on screening which were never upheld, limited outdoor sales during a different administration, there’s a sales display in the right-of-way along Kings Road. He said a report was prepared identifying the various issues. He said these issues have been identified along with non compliance letters. They are asking the zoning administrator to sign off on this and he doesn’t believe the existing conditions have been addressed. He said there is a staff meeting in a week and he would like to look at the city’s file to make sure there haven’t been any negotiations he’s not aware of. Hughes asks about the dealers’ license to sell what. Brixius said he thinks this is a renewal of existing and he would be selling new merchandise. He said he wants the council to be aware of this as there might be some phone calls. Bren said she is concerned about his trailers parked along Kings Road and she feels this is not new merchandise. Brixius said he doesn’t think trailers qualify for vehicles. Brixius said the parking to the north is in violation, the parking in the right-of-way is in violation. Williamson said his concern, being aware of issues with this property, he remembers there was some legal action taken in the past with the city. He said the concern with this is verbal agreements and claims made that what they are doing is okay. He said the council is going to need a laundry list divided into priorities to have an idea as to what issues they are dealing with. Williamson wonders if Brixius can have a briefing on Monday and Brixius said he wants to wait until they meet as staff and come up with a plan. Brixius said after the staff meeting there will be a plan for consideration. He said they are looking for O’Flanagan to be involved. Williamson wonders what is next. Brixius said this will be ongoing.


    1. City Administrator – nothing.
    2. City Engineer – nothing.
    3. City Attorney – nothing.
    4. Utility Superintendent
  1. UPCOMING MEETINGS & TRAINING – Other meetings previously stated are the LMCD and the LMCC meetings and fire commission tomorrow. There is upcoming training by the League for new council members.
    1. January 26 – City Council Work Session – 7:00 PM
    2. February 2 – Regular City Council Meeting – 7:30 PM
  3. NEW BUSINESS & COMMUNICATION – Williamson said water treatment is higher than normal. He wonders if this was based on excessive flow. Tolsma said it’s because of the June rain and so much I&I.       He said the info from the Met Council is everyone is seeing a rate increase because of the rain. He said this will be reflected on utility bills next quarter as this is a passed through charge. Williamson said the engineer fees are high as they are associated with the road project. Tolsma confirmed it has to do with road projects and drainage project. Hughes makes a motion to pay the bills and Horton seconds. All votes ayes, motion carries.
    1. Bills & Payroll
    2. LMCC Appointment – Williamson said every member city appoints two members. One must be elected. He said in the past it’s been held by two members of the council. Williamson holds the elected position and Council member Horton has expressed interest in being the second member. He said the default is to former council member Sippel who has said he would continue his seat.       Williamson makes a motion to appointment council member Pamela Horton to the second position on the LMCC. Hughes seconds the motion. All votes ayes, motion carries.
  4. MISCELLANEOUS (Information Only) -
    1. Fire Department Press Release – Hughes said the stats are interesting and the number of fire and rescue calls are about equal. City of Spring Park has more rescue calls due to Pres Homes but even that has gone down.
    2. Fire Department December 2014 Report
    3. LMCD Newsletter


Hughes wants to mention that the LMCD will be sponsoring three boater safety training sessions again this year.  He urges those interested to check the LMCD website for dates and times. 


  1. ADJOURNMENT – Bren makes a motion to adjourn the meeting at 9:02 p.m. and Horton seconds. All votes ayes, motion carries.






Wendy Lewin, City Clerk






Dan Tolsma, City Administrator