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City Council - 11/05/1991 EDEN PRAIRIE CITY COUNC .APPRO�`T1 MDTUTE�- TIME: 8:00 PM Tuesday, November 5,, 199" LOCATION: City Hall Council Chambers 7600 Executive Drive COUNCILMEMBERS: Mayor Douglas Tenpas, Richard Anderson, Jean Harris, H. Martin Jessen and Patricia Pidcock CITY COUNCIL STAFF: City Manager Carl J. Jullie, Assistant to the City Manager Craig Dawson, City Attorney Roger Pauly, Finance Director John D. Frane, Director of Planning Chris Enger, Director of Parks, Recreation & Natural Resources Robert Lambert, Director of Public Works Gene Dietz, and,-Recording Secretary Roberta Wick PLEDGE OF ALLEGIANCE ROLL CALL All"Councilmembers present. (Mayor Tenpas arrived at 8:10 PM) Acting Mayor Richard Anderson called the meeting to order at 8:00 PM. I. APPROVAL OF AGENDA AND OTHER ITEMS OF BUSINESS SMOTION Pidcock moved, seconded by Harris, to approve the agenda. Harris requested three items be added to X.A. Reports of Councilmembers: (1) Truth in Taxation; (2) Correspondence on Outdoor Advertising; (3) Bluffs Road Appeal. Pidcock added one item: (4) Commendation to City Staff for Snow Removal Efforts. Jessen added (5) Martin Luther King Day Observance. Agenda approved as amended 4-0. II. MINUTES A. City Council Notes from Meeting held October 14, 1991 MOTION Harris moved, second by Pidcock, to approve Notes from City Council held October 14, 1991. Motion approved 4-0. Eden Prairie 2 Noti ember 5, 1991 City Council Minutes approved B. City Council Minutes from Meeting held`'tuesday, --amber 15, 1991 MOTION Pidcock moved, seconded by Harris,. to.approve the minutes of the Regular. City Council meeting held Tuesday, October 15, 1991. Jessen noted that on Page 6 of the minutes, there had not been a second to the motion regarding Resolution No. 91-237 concerning the Windslope Apartments. Pidcock said she had seconded that motion. Motion to approve the Minutes as amended approved 4-0. C. City Council Minutes from Meeting held Tuesday. October 22, 1991 MOTION Pidcock moved, seconded by Harris, to approve the Minutes of the . City Council meeting held. Tuesday, October 22, 1991. Jessen requested a correction on Page 10 of the minutes. The last sentence in the second paragraph should read: "Jullie said the prospectus was available to staff at the time the proposal was discussed but was not available to Council at that time." Motion to approve the Minutes as amended approved 4-0. Mayor Tenpas arrived at 8:10 PM and conducted the meeting from this point. III. CONSENT CALENDAR A. Clerk's License List B. Recommendation on Selection of Architect for Design Services for Community Center Addition C. Request for 24-Month Extension to Schwab Developer's Agreement (dba R. G. Read Development) D. Approval of Final Plat of Bluffs East 11th Addition (located north of Bluff Road and east of County Road 18) Resolution No. 91-241 E. Approve Change Order No. 1 for Staring Lane and Sunrise Circle Improvements, I.C. 52-203 & I.C. 52-205 F. Approve Change Order No. 3 for Mitchell Road and Sandy Pointe Addition Improvements, I.C. 52-156 & I.C. 52-201 G. Approve Change Order No. 2 to Eden Hills Improvements for Bluffs East 11th Addition, I.C. 52-212 i f Eden Prairie 3 November 5, 1991 - } • City Council Minutes apprc I . H. Approve Addendum to Agreement PW 19-15-90 with Hennepin County and City of Minnetonka for EAW on Townline Road, I.C. 52-103 I. COMPREHENSIVE GUIDE PLAN AMENDMENT by the City of Eden Prairie. Adoption of Resolution No. 91-158, Adopting the Eden Prairie Comprehensive Guide Plan Amendment to add 317 ± acres into the Eden Prairie MUSA .line. (Resolution No. 91-158 - Guide Plan Amendment) J. Resolution Establishing Procedures Relating to Compliance with Reimbursement Bond Regulations Under the Internal Revenue Code (Resolution No. 91-244) K. 1992 Budget = Voting Machines - MOTION Jessen moved, seconded by Pidcock, to approve the Consent Calendar. Consent calendar approved 5-0. IV. PUBLIC HEARINGS • A. SPECIAL ASSESSMENT HEARING (Resolution No. 91-240A) Continued from October 22, 1991 Jullie said that staff had reviewed a number of issues raised at the Special Assessment Hearing on October 22, 1991 and staff had prepared recommendations for Council consideration. Dietz directed Council's attention to several minor changes in the packet. On Page 2332, Project I.C. 52-177, frontage road and utility improvements along Highway 5, the cost should be for a 6-inch water main which would result in a $3,000 reduction to each of the two parcels in this project. On Page 2333, I.C. 52-197, Sanitary Sewer through the Delegard Property to serve the Shores of Mitchell Lake Plat, the developer had asked that-the $171,518.37 be deferred with interest until development and this request had been granted. On Page 2334, I.C. 52-201, Utility and Street Improvements in the Sandy Pointe Addition, the developer requested that some of the amounts for the lots shown in the shaded areas of the page be changed. The developer had closed on these particular four lots and had made some commitments regarding assessment amounts. The total amount of the assessment remained the same, but some of the distribution of the costs had been changed to accommodate the developer. Eden Prairie 4 November 5, 1991 j City Council Minutes appr<*4 - On page 2336, the Celia Fisher property, the owner had died and the property was owned by her estate. Her grandson lived on the property and therefore it should be shown as homestead property. The assessment had been changed from $5,153.90 to $1,719.50 and the utility portion of $3,034.00 would be deferred until 1997. He said the first issue regarded the multiple-unit benefit to homestead properties. Several properties in the Sunrise Circle East and Staring Lane/Ridge Road projects had development potential beyond the homestead unit. After study, staff recommended that the principal amount as originally shown on the assessment roll be levied against the properties and the interest be dropped to zero until development, at which time the properties would be given five. years to pay the assessment at the prevailing interest rate." Dietz and Gray demonstrated several examples of what the implications of this policy would mean in terms of lost interest revenue to the City. Dietz pointed out that the City was under no obligation to make any deferment retroactive. The first example illustrated that if Council were to decide to make the deferment retroactive for all projects through year-end 1991, the City would lose approximately $92,000 in interest in 1991, $778,000 in five years, and $1,530,000 in ten years. The criteria used for properties listed in the chart were that the properties were homesteads, eligible for subdivision or further development, without regard to the size of the property. In the second example, Dietz prefaced his remarks by saying that a larger parcel had a greater potential of being purchased by a developer, subdivided and developed. Therefore, staff had developed a chart to show what would happen if the deferments were limited to parcels of five acres or less. In this case the loss to the City in interest revenue at the end of 1991 would be $63,000, in five years $319,000 and in ten years $583,000, with the assumption that no development occurred. He believed this was a reasonable alternative to making all of the multiple-unit assessments carry zero percent interest. Tenpas asked if there was a way that if a property were never developed, paying off the assessment at the time of sale could be avoided. Pauly said there was nothing in the law with respect to abatement of previous assessments or interest accruing to those assessments. Pauly said he believed the deferment of interest on the unimproved portion of properties was a reasonable alternative. However, he pointed out that the Constitution required that the assessments be uniform on like properties or classes of properties. He said that the statutes specifically stated that assessments on unimproved property • could be deferred, so he believed there was logic in going one step Eden Prairie 5 November 5, 1991 City Council Minutes approved further and not imposing interest on the unimprc vied portion of a property. The question on limiting the deferment to properties of five acres or less was whether or not this was a reasonable classification. He said that sustaining the interest portion on parcels just over five acres, for example six or seven acres, would be more difficult. In answer to Tenpas's question, Pauly said he did not believe there was a possibility of the assessment not being paid off at the time of sale because the statutes stated that cities could assess for sewer and water improvements on abutting and non-abutting properties that had not previously been assessed. Once a parcel had been assessed, it could .not be assessed again after it was subdivided. However, the City Code permitted the imposition of a connection fee for water and sanitary sewer. City Code currently provided that if a parcel had been assessed for the line into which the connection was to be made, then the connection charge could not be imposed. However, he believed the Code could be revised so that if a parcel . had been assessed for one connection charge and was later subdivided, another connection charge could be imposed upon those additional parcels resulting from the subdivision. He said the law required that the connection fee have a reasonable relationship to • previous costs for the same type of improvements. Dietz said that there were four objections received at the hearing on October 22, 1991 regarding the multiple-unit assessments. Three specifically stated the objection to interest accumulating on the project, and the fourth was on the amount of the total assessment. He said the ability to refinance had not been an issue raised by residents of the community. Tenpas said he would favor assessing street improvements only, and use the remainder of the assessment as a connection fee at a future date. He said he would also favor deferring all the interest retroactively-on all the projects listed in the report regardless of parcel size. Dietz said that he understood that Council direction in this matter was that for the multiple-unit assessments in the Sunrise Circle and Staring Lane/Ridge Road neighborhoods, the principal amounts would be as shown on the assessment roll but would be deferred with no interest for the street portion, and the $7,400 would be excluded until development and charged as a connection fee at .that time. After further discussion and questions on specific projects and properties, Council agreed to continue these objections until November 19, 1991 so that questions on specific properties could be clarified further. Eden Prairie 6 November 5, 1991 City Council Minutes approved Anderson said he was comfortable with`setting thc- iimit for the deferment at five acres. Harris said she concurred with this because the real goal of the deferment was. to protect older homesteads. Pidcock said her concern was that nobody was forced out of a home because of assessments. . Dietz. said there were fifteen objections filed at-the last hearing and four of those indicated issues about the multiple-unit assessments and the rest raised the issue about the $15,000 maximum assessment for homestead properties. He said there were two issues: (1) Fairness and (2) Benefit. Regarding, the,fairness issue, because of the .cap on assessments the City would subsidize the work in the Staring Lane/Ridge Road area by $2,094 per unit, .because. the actual cost per unit would be $17,094. In the Sunrise .Circle neighborhood, actual cost was $21,246 per unit so- 'the City would subsidize $6,200 per unit. He said that because of the pattern of lots in these particular neighborhoods, the cost of the improvements .was higher than usual. In regard to the benefit issue, Dietz explained that through the exclusion policy, street and storm sewer improvements were assessed at the time the work was done, with the utility portion of the assessment deferred until the property owner connected to the City utilities or for up to five ,years at zero percent interest. This meant that the City would actually be subsidizing working septic tank and water systems for up to five years. He explained how this allowed a staged payment plan because the payment on the street assessments would drop each year for the first five years, and then in the sixth year, when the utility portion was assessed, the payment would rise slightly again, and then drop as the principal amount was reduced. He added that it was the opinion of the City Assessor that the most dramatic increase in property value as a result of the improvements would be to the lower-value homes. He also said it was the opinion of the staff that the value of most properties would increase by $15,000 and that this was a fair assessment. He suggested that appraisals could be done on several representative properties in the Staring Lane/Ridge Road and Sunrise Circle neighborhoods before December 3, 1991 which was the date the special assessments must be certified. Doug Olson, 9030 W. Staring Lane, asked what the total interest and principal would be over 20 years. Dietz said this had not been added up but it would amount to $15,000 plus interest. Olson said he did not believe the principal and interest costs for the improvements would result in the same increase in value to his property. f / Y 3 Eden Prairie 7 November 5, 1991 r City Council Minutes apprc f N LeRoy Heitz, 9281 E. Staring Lane, said that realtors had informed him that his house would not sell for $15,000 more because of the improvements and that the increase in value would be closer to $9,000. He said he would prefer to obtain his own appraisal rather than having the City obtain the appraisal. Jessen said that the project was ordered because some of the residents were having problems with well and septic systems, so it was a matter of public health, and because of the layout of the neighborhood, improvements were expensive. He also pointed out that market factors other than improvements affected the value of property. Harris said she believed an independent appraisal on-properties- in'- these two neighborhoods would be useful. She believed that the City was already subsidizing the development fairly generously, and yet she empathized with the residents' concern over costs on the older neighborhood. Pidcock and Tenpas agreed. The consensus of the Council was that appraisals be done on two or three properties to determine how the improvements would affect the values of the properties. Dan Lindholm, 9271 E. Staring Lane, said he did not believe his property value would increase by $15,000 as a result of the improvements. He also said he believed there was a petition against the project as well. David Fisher, 15040 Pioneer Trail, asked what the amount of the assessment would be on his property. There had been some confusion because the owner of the property had died. Dietz said later in the hearings, the amount would be changed from $2,640 to $520 to be excluded until 1997. Pat Hartell, 9140 W. Staring Lane, said she had two lots that backed up to the Sunrise Circle project. She questioned whether the assessment to her property was appropriate because the lots were being assessed for storm sewer but had no street leading into them. She questioned whether these unimproved lots should be assessed the same as the completed lots in the Sunrise Circle neighborhood. Dietz said the assessment for storm sewer would be deferred until development at zero percent interest and the sanitary sewer portion would be treated as a connection fee. She said she would like to see a comparison between her assessment and the assessment of the properties in the Sunrise Circle neighborhood. She believed she was being penalized for the high cost of the improvements in the Sunrise Circle neighborhood, and these costs were high because of the way the developer had designed the neighborhood. She also questioned why her property was not charged the Staring Lane prices instead of the Sunrise Circle prices. Eden Prairie 8 November 5, 1991 City Council Minutes apprc i -- Rod Beach, 9021 W. Staring Lane, was concerned about the language in a statute that if the properties were to be refinanced or sold, the full amount of the assessment would be due. Dietz said this was not a law but rather a lender policy. There were no further comments from the audience on these projects. Alan Gray, City Engineer, explained the details of a drainage problem on Randy Rannow's property consisting of two parcels. Because of development in the area, much of the drainage had been diverted to Red Rock Lake via a storm sewer. However, there was one portion of street. that continued to drain to a depressed area on his property: Gray explained the system that was planned to alleviate the problem with no cost to Mr. Rannow. He said staff believed that the unit assessment for streets which included the cost of the storm sewer in the neighborhood was a reasonable assessment. Randy Rannow, 5908 Cedar Ridge Road, said he believed that the purpose of a storm sewer was to dispose of the drainage in the street in front of a parcel of property and that was not receiving that benefit with the present system. He was not sure that the plans outlined by Gray would correct the situation. He suggested that the storm sewer portion be deducted from his assessment until the problem was solved. Council agreed that assessments could be deferred until the problem was solved. 'Dietz pointed out the following changes in the supplemental assessments: On Page 2340, $520 was removed from Parcel 21-116-22- 22-0014 as this house had burned; On Page 2343, the Celia Fisher property Parcel 21-116-22-43-0017, the amount be changed from $2,640 in 1992 to $520 in 1997; On Page 2345, Parcel 26-116-22-41- 0037, shows an amount of $8,502.81 which was a change from approximately $10,000 because the property owner was able to demonstrate there was an error in the front_footage used in the computation. There were no further comments from the audience. MOTION Harris moved to close the public hearing and adopt Resolution No. 91-240A to certifiy the special assessments, with the exception of the Sunrise Circle and Staring Lane/Ridge Road projects. Seconded by Pidcock. Motion approved 5-0. y Eden Prairie 9 Novembz�r 5, 1991 City Council Minutes approved B. EDEN PRAIRIE AUTO CENTER by Accent Real Esta Ltd. Adoption of Resolution No. 91-243, Request for Planned Unit Development Concept Review on 16.2 acres; Planned Unit Development District Review on 16.2 acres with waivers; Zoning District Amendment within the C-Reg- Ser District on 16.2 acres; and Site Plan Review on 16.2 acres for development of a 158,800 square foot automobile dealership to be known as. Eden. Prairie Auto..Center. Location: Southeast corner of Valley View Road and Plaza Drive. (Resolution No. 91-243 - PUD Concept; Ordinance No. 30-91 - Zoning District Amendment) Jullie said notice for the public hearing had been properly published in the Eden Prairie News and mailed to residents in the project area. Herb Margolis, development consultant for Metropolitan Corporation, presented the details of the plans for Eden Prairie Auto Center using a scale model of the building and surrounding land area. He said the concept was a one-stop auto shopping service which would house several major auto dealerships and service facilities. The total size of the project was approximately 158,000 square feet of building. At the present time, the Chevrolet dealership was the only one identified who would lease space in the building; however, the concept was to include multiple dealerships and expand the building • as required over a three-or-four year period. Margolis then addressed the issues on Page 2 of the memorandum dated October 29, 1991 from the City Planning Department. Regarding the matter of only.one grand opening permitted, he said the proponent interpreted this to mean one grand opening for each dealership coming into the Center. With respect to the signs, he believed the size allowed was adequate but said that the Center would not be able to control colors and shapes because that would be determined by the manufacturer. The one 320-square-foot, 7 foot-high monument sign on the proposed berm had been agreed upon. On the existing Factory Outlet Center sign, he said the Center would- like the logos of the companies being represented to be shown on this sign as well as some notification on where to turn to enter the Center. Enger said the project was reviewed by the Planning Commission at its October 7, 1991 meeting. A summary memo dated October 29, 1991 had been included in the packet. He said the main elements discussed had been the amount and visibility of the outdoor inventory, the level of lighting, the number, size, and, location of signs on the site. He stressed that because the proponent did not know at this time which dealerships would be included in the Auto Center, it did not kno-v.7 exactly what the size, shape, and color of the signs would be would be. The Planning Commission had been working with the proponent on a way to guide the signage package as dealerships were acquired for the Center to assure that the signs Eden Prairie 10 November 5, 1991 City Council Minutes r approved would be well-placed and avoid any garish appearance. He said staff and Planning, Commission recommended approval of the project. Anderson asked what the impact would be in the neighborhood to the north of the site with the lighting.. Enger said the 24-foot poles on the lights were low, as 30 and 40 feet were common, and for this reason he. would not expect. .the lights would not impact on the neighborhood. MOTION At 11:00 PM Pidcock moved to extend the meeting until 11:30 PM. Seconded by Jessen. Motion approved 5-0. Harris said she was. pleased, and impressed with the project and would vote for the first reading. Tenpas said he also supported the project for the site. There were no comments from the audience. MOTION Pidcock moved to close the public hearing and adopt Resolution No. 91-243 for PUD Concept Amendment. Seconded by Jessen. Motion approved 5-0. MOTION Pidcock moved to approve the First Reading of Ordinance No. 30-91 for Zoning District Amendment and direct staff to prepare a development agreement in Commission and staff recommendations and Council conditions. Seconded by Jessen. Motion approved 5-0. C. CITY CODE AMENDMENT (PUD CONCEPT AREA MINIMUM OF 15 ACRES) by City of Eden Prairie. Request to amend City Code Chapter 11, Section 11.40, Subdivisions 6 and 11 relating to PUD Concept Area minimum of 15 acres and Findings Required respectively. (Ordinance No. 24-91 - PUD Concept) There were no comments from the audience. MOTION Pidcock moved to close the public hearing and approve first reading of Ordinance No. 24-91 relating to the PUD Concept. Seconded by Anderson. Motion approved 5-0. Eden Prairie 11 November 5, 1991 •' r City Council Minutes CLppre i V. PAYMENT OF CLAIMS MOTION Anderson moved, seconded by .Pidcock, to approve payment of claims. Motion for payment of claims approved with Anderson, Harris, Pidcock, Jessen, and Tenpas all "AYE". VI. ORDINANCES & RESOLUTIONS VII. PETITIONS. REQUESTS AND COMMUNICATIONS A. Request to Consider Purchase of Five Parcels West of Eden Road (continued to November 19, 1991) B. Petition for the Closure of the Heritage Road/Highway 5 Intersection (continued to December 3, 1991) VIII. REPORTS OF ADVISORY BOARDS, COMMISSIONS, & COMMITTEES IX. APPOINTMENTS X. REPORTS OF OFFICERS A. REPORTS OF COUNCILMEMBERS 1. Truth in Taxation Harris said she would prefer to continue discussion of this process to another meeting. 2. Correspondence on Outdoor Advertising Harris said at a future meeting she would like to discuss outdoor ` advertisements. 3. Bluff Road Appeal Harris asked how the assessment deliberations at this meeting would affect the Bluff Road project. Dietz said if the Council decided that five acres was the limit for deferment, this project would still be eligible for deferment as the lots were approximately six acres. Dietz said he would itemize the parcels and assessment costs for Council. i P Eden Prairie 12 November 5, 1991 City Council Minutes apprc # Y 4. Snow Removal By City Staff and Crews Pidcock said she wished to commend those responsible for the tremendous efforts in clearing the streets after the snowstorm of October 31 and November 1. Tenpas added commendations to the Police and Fire Departments as well for the fine work in assisting persons having difficulties because of the storm. 5. Martin Luther King Day Jessen asked how much money was needed for Martin Luther King Day. Jullie said he would find out and let him know. Jessen said he believed the. City should pay for the. observance of this holiday. B. REPORT OF CITY MANAGER 1. Proposed 1992 Budgets for Enterprise Activities (Continued from October 15, 1991) Council agreed postpone this item to a future, meeting. XI. OTHER BUSINESS XII. ADJOURNMENT MOTION Pidcock moved, seconded by Harris, to adjourn at 11:30 PM. Motion approved 5-0.