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City Council - 02/16/2010 APPROVED MINUTES EDEN PRAIRIE CITY COUNCIL MEETING TUESDAY, FEBRUARY 16, 2010 7:00 PM, CITY CENTER Council Chamber 8080 Mitchell Road CITY COUNCIL: Mayor Phil Young, Council Members Brad Aho, Ron Case, Jon Duckstad and Kathy Nelson CITY STAFF: City Manager Scott Neal, Parks & Recreation Director Jay Lotthammer, Public Works Director Gene Dietz, Community Development Director Janet Jeremiah, City Attorney Siira Gunderson and Council Recorder Jan Curielli I. ROLL CALL/CALL THE MEETING TO ORDER Mayor Young called the meeting to order at 7:00 PM. All Council Members were present. II. COLOR GUARD/PLEDGE OF ALLEGIANCE Mayor Young thanked Girl Scout Troop 1085 for presenting the colors. III. OPEN PODIUM INVITATION IV. PROCLAMATIONS /PRESENTATIONS A. DORTHEA NELSON AWARD PRESENTATION Lotthammer said Parks and Recreation Department employee Nicole Weedman was recently selected to receive the Dorothea Nelson award. This prestigious award is given to a female who is a professional member of the Minnesota Recreation and Parks Association (MRPA) with fifteen years or less of professional experience. The selection is based on outstanding services to the parks and recreation field and to the MRPA. He presented Ms Weedman with the award. Mayor Young congratulated her on the accomplishment. B. ART CENTER DONATION Lotthammer said the Eden Prairie Lioness Club is donating $1,800 to assist with funding for equipment at the Art Center. He noted this is the second gift we have received from them for the Art Center. He thanked the Lioness Club for their donation. MOTION: Aho moved, seconded by Nelson, to accept the donation from the Eden Prairie Lioness Club in the amount of$1,800 to assist with funding for equipment at the Art Center. Motion carried 5-0. CITY COUNCIL MINUTES February 16, 2010 Page 2 V. APPROVAL OF AGENDA AND OTHER ITEMS OF BUSINESS Young added Items XIV.A.1., 2., and 3. Neal added Item XIV.B.2. Neal said the Historical Society has requested Item XIV.B.1. be tabled until after their next meeting so they can review the item at the meeting. Case added Item XIV.A.4. MOTION: Duckstad moved, seconded by Case, to approve the agenda as amended. Motion carried 5-0. VI. MINUTES A. COUNCIL WORKSHOP HELD TUESDAY, JANUARY 19, 2010 MOTION: Case moved, seconded by Aho, to approve the minutes of the City Council Meeting held Tuesday, January 19, 2010 as published. Motion carried 5-0. B. CITY COUNCIL MEETING HELD TUESDAY,JANUARY 19, 2010 MOTION: Aho moved, seconded by Nelson, to approve the minutes of the City Council Meeting held Tuesday, January 19, 2010 as published. Motion carried 5-0. C. SPECIAL COUNCIL MEETING HELD TUESDAY, FEBRUARY 3, 2010 MOTION: Nelson moved, seconded by Case, to approve the minutes of the Special City Council Meeting held Tuesday, February 3, 2010 as published. Motion carried 4-0-1, with Duckstad abstaining. VII. REPORTS OF ADVISORY BOARDS & COMMISSIONS A. FLYING CLOUD AIRPORT ADVISORY COMMISSION Rick King, Chair of the Flying Cloud Airport Advisory Commission, reviewed the commission's 2009 report and presented their 2010 goals and work plan. He said the runway expansion has been completed, and the redevelopment of the buildings on the north side of the airport is underway. Security improvements completed in 2009 have made the airport one of the safest in the country. The commission continued addressing the issue of nighttime noise at the airport and helped to develop a pilot safety guide which highlights a number of significant noise abatement procedures to help minimize noise. He said their goals for 2010 are much the same as for 2009. They will be focusing on the appearance of the airport and plan to modernize the buildings and make the landscaping as attractive as possible. MOTION: Duckstad moved, seconded by Aho, to receive the Flying Cloud Airport Advisory Commission 2009 report and to approve its 2010 goals and work plan. Motion carried 5-0. CITY COUNCIL MINUTES February 16, 2010 Page 3 VIII. CONSENT CALENDAR A. CLERK'S LICENSE LIST B. ADOPT RESOLUTION NO. 2010-20 APPROVING FINAL PLAT OF MENARD'S 8TH ADDITION C. APPROVE SETTLEMENT AGREEMANT WITH CINCINNATI INSURANCE COMPANY RELATING TO MANLEY DEVELOPMENT, INC DEFAULT ON COMPLETING LANDSCAPING AGREEMENT WORK ON THE HERITAGE DEVELOPMENT PROJECT D. DECLARE OBSOLETE COMPUTER EQUIPMENT AS SURPLUS E. DECLARE VEHICLES AS SURPLUS F. APPROVE 2010 VEHICLE REPLACEMENT FUND SCHEDULE G. APPROVE AMENDED CONTRACT FOR REPAIR OF STILLING BASIN 36-42-C H. APPROVE AMENDED CONTRACT FOR NEILL LAKE BERM ANALYSIS Case asked if the stilling basin in Item G is mitigation of the pond that malfunctioned on the east side of the river bottom area. Dietz said this is the one by the Fowler property. Case said he thought the original pond was built just a couple of years ago. Dietz said it was upgraded a few years ago,but it was originally built to mitigate the erosion problems with the property on the north side in Bell Oaks. It was upgraded with the construction of the Hustad property a few years ago and was always intended to be an interim solution. Dietz said the action tonight is to increase the value of the contract with the consultant to do the design work. We received input from the Lower Minnesota Watershed District consulting engineer about some design changes and we also received input from another consultant. Their input resulted in a change in scope from the original contract the Council approved several months ago. Case said he didn't know why the Hustad project wouldn't have funded this. Dietz said our intent and our planning always in this issue was to put in a final pond area with the reconstruction of that segment of Riverview Road. The stilling basin that was there to keep the water from eroding the bluff area failed at some level. The PCA has demanded we repair the basin. We would rather wait until we do Riverview Road,but we now have to complete repairs by the end of the construction season. Nelson asked if there are any energy efficient vehicles on the 2010 Vehicle Replacement Fund Schedule. Dietz said we have a couple of hybrids vehicles in the fleet but in this replacement schedule we are changing the kind of vehicles to be more fuel efficient. He said we are limited to using hybrids for supervisory work, but we are doing some good things to improve our miles per gallon ratios for work CITY COUNCIL MINUTES February 16, 2010 Page 4 truck replacements. MOTION: Duckstad moved, seconded by Aho, to approve Items A-H on the Consent Calendar. Motion carried 5-0. IX. PUBLIC HEARINGS/MEETINGS A. VACATION OF EASEMENTS —MENARDS 7TH ADDITION, LOT 1, BLOCK 1 (Resolution No. 2010-21) Neal said official notice of this public hearing was published in the January 28, 2010, Eden Prairie News and sent to six property owners. The property owners have requested the vacation of all the drainage and utility easements to facilitate the plat of Menard 8th Addition for the Menards building reconstruction. The drainage and utility easements were originally dedicated with the plat of Menard 7th Addition. New drainage and utility easements will be dedicated with the plat of Menard 8th Addition. The release of the resolution vacating the drainage and utility easements shall be conditioned on the recording of the plat of Menard 8th Addition. He said there have been no objections to this. Dietz said Xcel Energy is a recipient of vacation notices, and they have requested the minutes of this meeting acknowledge that Xcel Energy has a north-south electrical line that exists on the property to serve Menards that is not shown on the plat as an easement. Tom O'Neill,representing Menards Corporation, said vacation of the easements is necessary for the demolition and reconstruction project there and they are in support of the vacation. MOTION: Aho moved, seconded by Nelson, to close the public hearing, and to adopt Resolution No. 2010-21 vacating all of the drainage and utility easements lying over, under and across Lot 1, Block 1, Menard 7th Addition, according to the recorded plat thereof, Hennepin County, Minnesota. Motion carried 5-0. B. ALLOCATION OF COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS FOR ACQUISITION OF A FACILITY BY THE PROP SHOP Neal said official notice of this public hearing was published in the January 14, 2010, Eden Prairie News. The Prop Shop is a social entrepreneurship based organization whose mission is to provide basic support for families in need through volunteers, community and other organizations. The Prop Shop's programs assist low income families in Eden Prairie and Chanhassen. In 2006, a Board of Directors, including a volunteer Executive Director, formed the Prop Shop (a separate organization from PROP). Neal said donations to the Prop Shop also stock the resale store which raises funds for its operations and serves as a fundraising mechanism for local social services organizations. The Prop Shop has given $25,000 to PROP and Meals on Wheels. CITY COUNCIL MINUTES February 16, 2010 Page 5 The success of the retail store surpassed expectations, whereas the initial budget projected making a profit in three years, the store actually met its expenses within the first month. Annual profits have continued to increase each year and the Prop Shop maintains a cash reserve for six months of operating expenses. The building which the Prop Shop has been renting since 2007 became available for purchase in late 2009. This site has been a perfect fit for the Prop Shop as it is centrally located in Eden Prairie, with easy access to Highway 212 and is in the same neighborhood as PROP. Neal said the sale price is $550,000 (also appraised at$550,000). The Prop Shop has been approved for a $350,000 mortgage through Flagship Bank. The Prop Shop will make a $200,000 down payment, with $100,000 coming from their cash reserves and $100,000 coming from the CDBG grant. The CDBG funds to be used are generated from the 2009 program income, and the expenditure will not take funds from any other program and will assist the city's obligation to expend program income in a timely manner. Jeremiah said the program income for 2009 was about$129,000, and there is some remnant program income from previous years so we are in a situation where HUD is looking for us to spend this down. This is within the 85% requirement for spending on bricks and mortar. Young noted these are pass-through dollars from the federal government and are not from Eden Prairie tax dollars. Deb Karulf, President of the PROP Shop Board, said they are a new kind of nonprofit that opened their doors in April of 2007. Their goal is to become completely self sustaining and to give back to the Eden Prairie community. Owning this building will allow them to decrease their operating expenses. She said they have helped over 800 families including over 3500 individuals. Because of the success of their operations, they were able to raise over half of the down payment needed for the building. Ann Rannow, 17150 Cedarcrest Drive, said she represents the network of volunteers at the PROP Shop and asked the Council to help the PROP Shop realize the dream of owning their building. MOTION: Nelson moved, seconded by Aho, to close the public hearing and to approve the allocation of$100,000 in Community Development Block Grant funds to the Prop Shop for acquisition of a facility to be used as their base of operations. Motion carried 5-0. C. SMITH DOUGLAS MORE HOUSE CONDITIONAL USE PERMIT AMENDMENT Neal said official notice of this public hearing was published in the February 4, 2010, Eden Prairie News and sent to 81 property owners. In June, 2002, the City Council approved a conditional use permit for the Smith Douglas More House. CITY COUNCIL MINUTES February 16, 2010 Page 6 The current permit only permits the sale of coffee and office use. Ann Schuster, who currently leases the building, would like to have additional uses permitted by the conditional use permit. The uses have been reviewed by the Heritage Preservation Commission and are listed in the attached January 22, 2010 Planning Commission Staff Report. The conditional use permit will expire February 16, 2015. A Heritage Preservation site alteration permit is not required. The Planning Commission voted 5-0 to recommend approval at the January 25, 2010 meeting. Jeremiah said most of the uses are limited to the inside of the building, with a couple of exceptions for wedding receptions, the Antique Fair Treasure Hunt and farmers market type activities. Young said the list of items includes a number of items that have been current uses of the property and asked if that means activity taking place there at the site has not been in compliance with the current permit. Jeremiah said that was correct, and there was a lack of memory of how limited the original conditional use permit was. She said it came to our awareness that the conditional use permit was not reflecting the types of use of the property and that was the reason we decided to revisit and amend it. Young asked how we enforce compliance with the conditional use permit after we grant it. Jeremiah said we generally enforce any type of compliance related to zoning and land use by complaint, and we weren't receiving complaints about the property. The additional public hearings held about the amendment gave us an opportunity to hear from neighboring properties, and most of the calls we received have suggested they are comfortable with the uses that have taken place there in the past. The only complaint about any activity happening there, Dave Lindahl has been the liaison between staff and Ms Schuster. Ann Schuster, manager of the coffee shop, was concerned that the document has changed since she saw it last. She said they have always had live music in the patio area during the summer and that is not included in the document changes. She said they have never received a complaint about the live music. Young asked if she was requesting a conditional use permit that permits music in the patio area. Ms Schuster said that was correct. MOTION: Case moved, seconded by Nelson, to close the public hearing. Motion carried 5-0. Case said he was part of the original process with the conditional use permit,but he didn't recall that we had the kind of specificity with uses that we are looking at tonight. He thought the fact that things have evolved and been permitted is not as much an infraction as it is that those things were just not included in the original permit. He said some of the activities were assumed to be okay. In his discussion with kids that frequent the place, music is an integral part of the coffee shop. He would be interested in working through a compromise if there had been a lot of complaints,but he thought it doesn't seem to be a problem since we have not CITY COUNCIL MINUTES February 16, 2010 Page 7 received any complaints. He thought we could have an annual review and allow the City or the owner of the franchise to express any concerns. That review would allow issues such as the Christmas tree sale and the music to be brought up and discussed. Young didn't think we need to spend a lot of time discussing the uses. Neal said the original conditional use permit was made in 2002, and he asked Ms Jeremiah how many conditional use permits exist. Jeremiah said there are definitely less than six, and it is not a tool we use frequently. Neal said that is good because it means we hold people to our code and don't make a lot of exceptions. He thought the amendment is trying to be very clear because we own the building and how the property has been used has been an issue that reached the Council. We want to make sure we are clear that things of a commercial nature going on in the building are permitted. Young asked if it is the tenant that should be the holder of the conditional use permit for a rental property. Neal said he was not sure,but thought that was normally the case. Young asked what rights remain with the City under the current lease as far as what control we have over what goes on there and any signs or literature that are displayed there. Jeremiah said the intent is for the conditional use permit to specify the allowable uses on the property. The lease speaks more to the payment of costs and who is responsible for maintenance of the property. The conditional use permit guides the use of the property. Our legal advice was to make sure we specify everything that is allowable,both inside and outside. The current language does not accommodate music on the patio. Young said this is an election year and he wanted to know what type of political activity we will permit there. He didn't know if that is controlled by the lease,but he didn't want any ambiguity about that. His concern is with material being left behind that indicates an endorsement of a particular candidate. He would want to cover any ambiguity in the lease about our rights to control that type of activity before we renew this lease. Neal said that is a very important question to answer and we would need to sit down with legal counsel and get his best advice. We could have an answer fairly quickly but do not have an answer tonight. Nelson said she liked the general list but was concerned about it being a little over restrictive. She didn't know how we get around that,but she would not like to amend this every time they want to make an addition to their menu. Young asked when the current conditional use permit expires because it seems to him we are not ready to make a decision on the permit. He wanted further explanations on the lease and the outside activities because he was concerned about the farmers market. He would like there to be greater opportunity for input on this from other entities such as the Chamber of Commerce. Case thought if we pull the item we might want to add a list of things to be looked at by staff. He appreciated Council Member Nelson's concerns, and he definitely CITY COUNCIL MINUTES February 16, 2010 Page 8 believed we should pursue language that permits the outside music. He agreed with getting some legal perspective about the political part of it because it is a City- owned building. Duckstad said we have a conditional use permit before us on the agenda which has been addressed and recommended by the City's Planning Commission. He didn't know the City Council is in a position legally to micro manage what the applicant of a special permit requested. He suggested the Council at least send it back to the Planning Commission and have them approve a special use permit with items listed. Young asked if he wanted to take a vote on this item tonight. Duckstad said he would have no problem with that as it was recommended on a 5-0 vote by the Planning Commission. He would like to know what the special permit included when it was recommended at the Planning Commission level. Nelson thought we could briefly fix this up but if we decide to put it off, she didn't want the things happening there to stop because she believes this is an asset to the community. She thought with some wording regarding items like the sale of food and adding live music in the patio area this could go tonight. We may have to hold back about the political issue. Most businesses don't allow political signs at all. Aho thought it would be better to send this back to the Planning Commission. He thought it is always a mistake to sit here and edit a document on the fly by committee. Staff can bring it back to the Council after the issues we mentioned tonight are addressed. Neal said this is a recommendation from the Planning Commission, and Council Member Duckstad asked what was included in their recommendation. It is the same list of uses, and he would suggest if the Council wants to direct it back to the Planning Commission it would be helpful to give them direction so they have somewhere to start. Young said there are two or three types of issues and he didn't think we will reach agreement on the Council so he was not sure what the Planning Commission would do with it. Case said he was not sure about sending something like this back when we could handle it and be done with it. He agreed we should clarify the political piece and that could be done outside of the conditional use permit. Since we are trying to save money he thought it should go back to staff for clarification and then brought back to the Council at the next meeting. Nelson said she was fine with it just going back to staff and then coming back to us. She didn't think it needs to go through another public hearing. Aho said he didn't think it needs to go through the full process and could just go back to staff to adjust as we have discussed tonight. CITY COUNCIL MINUTES February 16, 2010 Page 9 MOTION: Case moved, seconded by Aho, to continue the item to the March 9 meeting. Motion carried 5-0. D. ISSUANCE OF UP TO A $6,000,000 MULTIFAMILY HOUSING REVENUE NOTE, SERIES 2010 TO REFINANCE PREVIOUS BONDS ISSUED BY COMMUNITY HOUSING DEVELOPMENT CORPORATION AND FINANCE APPROXIMATELY$2,000,000 IN IMPROVEMENTS (PRAIRIE MEADOWS) (Resolution No. 2010-22) Neal said official notice of this public hearing was published in the January 21, 2010, Eden Prairie News. The City is authorized (particularly under Minnesota Statutes, Chapter 462C, as amended (the "Act") to carry out the public purposes by issuing revenue notes and bonds to defray, in whole or in part, the development costs of a low and moderate income rental housing. Community Housing Development Corporation plans to use the note proceeds to refinance certain taxable bonds previously issued to finance the cost of acquisition and rehabilitation of a 168-unit multifamily residential rental housing development for occupancy by persons and families of low and moderate income (the "Project"), located at 11345 Westwind Drive in the City, and generally known as Prairie Meadows Apartments, and financing additional improvements to the Project. This public hearing is to provide an opportunity for the public to comment on the project and the issuance of the debt. He said we serve as a conduit for a private developer to access tax free debt and does not carry public obligation. Jeremiah said there have been a series of rehabilitation projects to this property since 2005, and this will allow them to continue the work being done there. They are replacing the ventilation systems, re-grading the outside, installing emergency backup lighting, replacing interior fixtures, and doing other work. She noted the City makes 1/8 of 1% of the balance from these projects. Young asked if there are any circumstances under which the City of Eden Prairie could be compelled to pay the bonds. Neal said there are not. Nelson said she had heard rumors over time about some mold problems and asked if things will be brought up to code during the rehabilitation work. Jeremiah said they will, and noted in 2005 they replaced the windows and wound up with moisture problems. Case asked if this maintains our affordable housing which actually helps us with our voluntary obligations to the Livable Communities Act. Jeremiah said this does help us with our affordable housing commitment. Duckstad asked if the participation of the City of Eden Prairie in this matter is merely a formality and will not result in increasing or decreasing our present debt obligations. Neal said that was correct. There were no comments from the audience. CITY COUNCIL MINUTES February 16, 2010 Page 10 MOTION: Case moved, seconded by Aho, to close the public hearing and to adopt Resolution No. 2010-22 granting preliminary approval to the issuance of multifamily housing revenue note (Prairie Meadows Project), Series 2010. Motion carried 5-0. X. PAYMENT OF CLAIMS MOTION: Nelson moved, seconded by Case, to approve the Payment of Claims as submitted. Motion was approved on a roll call vote, with Aho, Case, Duckstad, Nelson and Young voting "aye." XI. ORDINANCES AND RESOLUTIONS XII. PETITIONS, REQUESTS AND COMMUNICATIONS XIII. APPOINTMENTS XIV. REPORTS A. REPORTS OF COUNCILMEMBERS 1. Hollywood Video—Mayor Young Young said the Council was notified in mid-January regarding the situation involving Hollywood Video. He asked if the Council had been apprised prior to January that they were in default of the rental obligations. Neal said he was not sure and would have to look back at the records. They had a previous bankruptcy prior to the current filing, so there was a previous incident of that. Young said he believed the last payment was received in August, and his preference would have been to know before mid-January that our tenant was behind in the rent. Now we are stuck because the parent corporation is in bankruptcy and we can't evict them without permission of the Bankruptcy Court. This is a concern to him, and if we had moved earlier in the eviction process we might be in a different situation. Gunderson said this is a Chapter 7 liquidation, and Hollywood Video has requested permission from the court to conduct a store closing sale. Permission has been granted and, according to documents submitted to the court, they have requested up to eight weeks to complete the store closing sale. At that point they will have to decide what to do with our leasehold interest. The City Attorney's office has spoken with counsel for the debtor, and they have indicated the debtor will most likely make a decision about the lease policy shortly after the completion of the store sale. Young said we don't know that for sure. Gunderson said that was true. CITY COUNCIL MINUTES February 16, 2010 Page 11 2. League of Minnesota Cities—Mayor Yount Young said everyone is aware our economic condition is difficult, and the state government has a significant deficit this year. The Governor took steps to balance the budget through the unallotment powers, and some litigation has ensued over that unallotment process. He said his understanding is that the League of Minnesota Cities has elected to file an amicus brief opposing the Governor's unallotment powers because one of the items unalloted was local government aid (LGA). He said Eden Prairie does not receive any aid from the LGA funds and is a donor to the system. This is another instance of the League taking a position that is adverse to the interests of the City of Eden Prairie. He said it is his intention to communicate by letter with the League of Minnesota Cities to voice his opposition to their participation in the Supreme Court appeal and also in opposition to their position on the Governor's exercise of the unallotment powers. He said he will write the letter under his name and asked other Council Members to join him if they would like. Aho said he would be happy to join in the effort. With regard to the League of Minnesota Cities joining a lawsuit, Duckstad asked if they have been previously involved in litigation that involved a decision like this. Young said the League has filed amicus briefs on other occasions. Duckstad asked if they were ostensibly political in nature. Young said he didn't know, and it was his concern that this involved interplay between the Governor and the legislature. Duckstad said the League generally serves all municipalities around the state, and common sense would say they should stay neutral and keep out of political leanings. He said he could be included in the Mayor's letter. He noted this is not an action of the Council. 3. 2010 Budget and the 911 Dispatch System—Mayor Young Young said we as a City are going to have a challenging budget season this year, and we need to do more than we have in the past to look for opportunities to cut costs and to coordinate services across all departments. He said he was concerned about our 911 dispatch system, and he has raised the issue in the past of what is the right path for the City of Eden Prairie. He understood that in years past Hennepin County was not willing to coordinate with other cities;however,he was surprised to learn that Golden Valley was recently included in the Hennepin County system. In the past we have made capital investments in the 911 system and he believes it is critical before any other issues of capital expenditures of that nature occur the City Council must be fully informed of the options. We have to look for those sorts of opportunities as we move forward or at least have the opportunity to discuss them. CITY COUNCIL MINUTES February 16, 2010 Page 12 4. Storm Water Retention Ponds—Council Member Case Case said at the last meeting we approved a schedule of compliance agreement with the Minnesota Pollution Control Agency (MPCA) regarding a plan to become compliant with our storm water retention ponds south of Riverview Road. He had a chance to do more study into that and also read the newspaper article last week. It appears that much of the erosion relates to the springs coming down into the bottoms area and our uncollected storm water spewing into the Minnesota River. He asked how much trouble we are in based on the new compliance agreement and how are we going to pay for the ponds. He noted Ms Stovring was planning to do a process to evaluate NURP ponds and asked where we are with that. He asked what plans we have for disposal of any regulated materials dredged out of the ponds. Dietz said we have a serious disagreement about our"spewing" erosion into the river. The nature of the article on the erosion in the river is all about why that pond failed. He said the river has moved 100 feet since we built the pond in 1987. The MPCA doesn't care about that and so we have to do something about it. We have put together a schedule of when we are going to comply, and at the time of the signing of the agreement we had concurrence and review concurrence from the MPCA of work we were going to do on the Fowler property. Subsequent to building the pond in 1987, a neighborhood on Spy Glass provided a pond that provided part of the 60/40 split. The one thing we have been able to agree on with MPCA is that building a pond in that location without taming the river is a waste of money. We have been waiting for the final report from the Lower Minnesota Watershed District on their study of the erosion problem. The cost for that will be over$1,000,000, and they would like to go to the 2011 legislature to see if there are funds available for the project. We have agreement with the MPCA that we are going to be able to replace the 40 or 60% elsewhere in the system. Depending on the advancement of a project to stop erosion on the river, we will be able to put the pond exactly where it was. If that erosion project does not advance, we will have to look at some place else in the system and we have until the end of the year to get a plan approved with the MPCA. Case asked if we have completed the survey of our ponds. Dietz said we have not. We do surveys of all the ponds and will be bringing a contract for another consultant to do the evaluation of the modeling of the various ponds. We will try to do a certain number of those each year and will determine if they are the right size and design and what needs to be done to bring them into compliance. Case asked how much is in the account. Dietz said we collect about $800,000 per year, and he was not sure how much storm water drainage money is in it now. We use the fund to pay for such things as street sweeping and staff members to administer programs. CITY COUNCIL MINUTES February 16, 2010 Page 13 Case asked if we found regulated materials. Dietz said we replaced the storm sewer in Bent Creek Golf Course when the corrugated metal piece failed and needed to be replaced. We were going to evaluate the site and enlarge the pond,but the soil samples had the 16-character carbon fraction materials in it. He said most of the ponds in the entire metropolitan area could have that material in them. Case asked if we have enough in our accounts and if we are planning for the possibility of how expensive it will be when we start cleaning them up. Dietz said the issue is that cities in the metropolitan area are spending millions of dollars, and the contribution we make to the Minnesota River is miniscule compared to the contribution from outstate rural agricultural land. That is where the erosion problem is, yet we are trying to solve the problem. He said we are low in our storm water rates and are doing a rate study now. Until we know some more details of the nature of the disposal of these things,he didn't think we will know what our rates will have to be. Duckstad asked if he said Eden Prairie has at least 900 of these ponds. Dietz said that is true. Duckstad noted Mr. Dietz indicated that we are electing to do the required maintenance incrementally. He said these ponds have existed for a long time and asked if there is any compelling reason why some or all of them have to be addressed at this time. Dietz said the reality is that the EPA has mandated certain things to happen, and we are classified as a MS4 city. In the beginning cities larger than 500,000 had to get a permit from the PCA to deal with storm water, and then they moved that requirement down to the MS4 cities. We are under mandate to inspect 20% of the ponds each year and file a plan to deal with the findings of the inspections. We may have to hire additional staff in this area and will probably spend a lot more to do maintenance. It is a complicated and frustrating process that has very specific requirements. Duckstad said we can only do so much and all the governmental agencies are suffering from a lack of revenue. He assumed other cities are in the same boat and asked what the solution is. Dietz said we are working on it. There is a study group of environmental coordinators in the area, and Ms Stovring is very active in. We have a consultant on retainer to keep us informed about what needs to be done. He noted this is the poster child of unfunded mandates. B. REPORT OF CITY MANAGER 1. Cummins Grill House Lease MOTION: Duckstad moved, seconded by Case, to continue the item to the March 9 meeting. Motion carried 5-0. CITY COUNCIL MINUTES February 16, 2010 Page 14 2. Re-interview of Current Commissioners Neal said we have a custom of requiring current members of our commissions to interview when they are up for reappointment. They fill out the form and questionnaire if they want to be reappointed and then go through the interview process. There has always been a question about the value of the re-interview process. We are scheduled to do that process next Tuesday night, and we will be sending letters tomorrow to applicants. There are 21 people to be interviewed, and eight of them would be re-interviews. Young thought asking sitting commissioners to re-interview is a poor use of our time and theirs. He thought we could excuse the current commission members from the interview process. Neal said he would also agree from a staff standpoint. He said staff can give the Council Members the questionnaire and the attendance information on the existing commission members. C. REPORT OF THE COMMUNITY DEVELOPMENT DIRECTOR 1. First Amendment to the Lease Between the City of Eden Prairie and Puresrace LLC at the Smith-Douslas-More Property Jeremiah said this item should also be postponed because of the continuance of Item IX.C. 2. Heritage Preservation Ordinance Report Jeremiah said during a Council workshop regarding Camp Edenwood, the Council expressed some interest in allowing certain minor changes to Heritage Preservation sites to be approved administratively. There was some confusion with the current code and what kind of restrictions there are on historic properties. She said a number of definitions have also been added to it to help clarify what is meant by a lot of the historic terms. Young asked if the Council is being asked to do anything tonight. Jeremiah said it is strictly informational, and she just wanted to make sure the Council's concerns and questions are covered before we go through the process. Young said without the ordinance it is hard to know if he has any questions, and he didn't recall that the impetus for this was the Council. He was concerned that changes to the ordinance not make the ordinance more cumbersome or expensive to us or the property owners. Case said he agreed that changes should not make it more cumbersome or more expensive,but he also thought the goal should be better heritage preservation. CITY COUNCIL MINUTES February 16, 2010 Page 15 D. REPORT OF PARKS AND RECREATION DIRECTOR 1. Three Rivers Park District Hyland-Bush-Anderson Lakes Regional Park Reserve Master Plan (Resolution) Lotthammer said the Three Rivers Park District, in conjunction with the City of Bloomington,has undertaken a master planning process to update the existing 1983 Hyland-Bush-Anderson Lakes Joint Master Plan. The master plan will provide guidance and direction for park improvements, natural resource management and future acquisition as well as park operations and management. They are asking us to pass a resolution in support of the draft master plan because a portion of the park district falls into Eden Prairie. Any of the park district land that is in Eden Prairie is owned by Three Rivers and is funded by them. They plan to connect the trails through Anderson Lakes and to put in an underpass under Hwy 169. They are involved in preserving Anderson Lakes in Eden Prairie as a natural area. He said the future development proposed will be in the Hyland area of Bloomington. Three Rivers requires that 80% of the park be maintained in a natural state with up to 20% developed for active recreation uses. He said our Parks Commission reviewed the item and were in support of the concept but expressed their reservations for making specific comments about items occurring outside of Eden Prairie. Young said he is a big fan of the Three Rivers Parks District,but he was not exactly sure it is our place to sign off on a resolution which confirms or addresses the adequacy of a public participation plan in which he was not involved or of a master plan that involved spending $35,000,000. He said he would be willing to pass a resolution generally saying it is their prerogative to do this,but he didn't want to pass a resolution on someone else's budget. Duckstad said he had the same question about why we have to adopt anything at this time. He asked what the compelling reason is for us to pass this resolution without knowing in further detail how it affects us. Lotthammer said he could get more details on the item. He thought it is a general part of their process to notify stakeholders that would be impacted. Young said they have certainly accomplished awareness in making us informed. He said passing a resolution that supports the management and development of the plan would give the imprimatur of the City and this Council. Nelson said she was not even sure she wanted to sign off on a tunnel under Hwy 169 in a wetland area or do a blanket approval that all these are good ideas. She was glad to get some of the information,but she was not ready to do some type of blanket endorsement for it. CITY COUNCIL MINUTES February 16, 2010 Page 16 Duckstad said he appreciated being informed, however he was not in support of the resolution as stated. Neal said if the Council would like, staff could extend the Council's appreciation for the update and let them know that you don't feel comfortable passing the resolution. Young said it just goes outside matters that are properly brought before the City Council. 2. Riley Property Acquisition Lotthammer said in 1971, 1975, 1976 and 1983 the City of Eden Prairie entered into grant agreements to use $548,496 of State and Federal Land and Water Conservation Funds (LAWCON) for Staring Lake Park land acquisition and development. The agreements that were entered into require the City to maintain the land as parkland or enter into a mitigation process. During planning for the expansion of the Pioneer Trail road project, it was identified that parkland encumbered with LAWCON would be impacted and needed for the project. He showed a map of the Staring Lake area and said in order to satisfy the land mitigation requirements resulting from the Pioneer Trail road project, staff has identified a property that has been previously identified in a Parkland Acquisition Report. This land is available for purchase, meets federal guidelines for replacement and satisfies the required mitigation value. Funding for the project is addressed in the agreement with Hennepin County and calls for each agency to share equally in the cost of land mitigation. Hennepin County land acquisition staff would work to acquire the property at the best possible price. Later in the project, the County will transfer the property to the City of Eden Prairie for park purposes. This was reviewed with the Parks, Recreation and Natural Resources Commission and a motion to recommend acquisition was passed unanimously. Young asked about the meaning of the colored strips on the map. Lotthammer said the one on the far right is the Cummins Grill property which is 6(f) property. The blue strip is both 4(f) and 6(f). Young asked if both of these were encumbered by LAWCON restrictions. Lotthammer said the entire property is encumbered when you sign the LAWCON agreements and anything done to the property has to be mitigated. In 1971 there was a survey submitted back to the federal government that showed the entire boundary at that time. Whenever we acquired more land after that, the park property was resurveyed and it has to encompass the entire parkland. Young said he saw our land is divided by MAC property and asked if that was also subject to LAWCON. Lotthammer said the one that isn't subject to LAWCON is the Boyce property and that has to do with the dates of when things were drawn on that survey. He said we did receive some mitigation credit when the Picha property was purchased which freed up the Cummins Grill status and also gave credit for what needed to be mitigated for the road project. The piece of property to be acquired is at Riley Lake Park and CITY COUNCIL MINUTES February 16, 2010 Page 17 would more than satisfy the mitigation need for the road project. The property sits on the way to the beach and was identified by the City some time ago as desirable to make the park whole. Young asked if there is ultimately any cost to the City for the acquisition. Lotthammer the City's portion of the road project is the City cost. There is a 50150 agreement with the road project for property mitigation. Young asked there then any LAWCON restrictions on Riley Lake if we buy LAWCON mitigation property there. Lotthammer said in the early 1980's funds received for Riley Lake Park were LAWCON-related. Young said he understood the concept behind LAWCON restrictions, but he thought taking strips of land does not change the fundamental utility of the land. He would think the federal government would give us a pass and not make us buy property. He said the statute has a process whereby they can relieve us of that requirement to mitigate, and he asked if we checked into that. Lotthammer said our representative to the DNR has had discussions with them, and he believes it is very clear that we have to do this. They look at it as a protection to the park, and they have a very strict interpretation. Young asked if we know who we have been dealing with. Lotthammer said we work through a specific individual at the DNR. Young asked if that means we have not had direct communication with anyone in the federal government about this. Lotthammer said that was correct. Young said it makes no sense to him that the federal government would require us to do this, and he would like a letter from the federal government showing we are required to do it. Dietz said we have been the recipient of these many times over the years. This is one of the most inflexible processes he knows, but we can always ask the question. Young said he wanted the question asked in such a manner that we get a written response back. Duckstad asked what the cost to the City is. Lotthammer said the appraisal was in the neighborhood of$400,000,but it is split 50150 between the county and the City as a part of the road project. Duckstad said he understood the cost would come out of the road project and asked if this is an additional cost or is it part of the original cost. Dietz said this was all part of the cooperative agreement we signed with Hennepin County. By their practices and standards right-of-way acquisition costs are a 50150 split. Our share of the project costs and the right of way costs is coming from municipal state aid funds. Dietz said he didn't think there is any choice in this,but there is always room for challenge. Case said we have tried for 20 years to get this property and he went along with not purchasing it the last time it came up. At that time the majority on the City Council wanted to own this property. The property fragments the park and we can now get it for half its value. From a financial standpoint and a sense of what is best for the City, this is a fantastic opportunity. CITY COUNCIL MINUTES February 16, 2010 Page 18 Young asked when we have to act on this. Lotthammer said he has told Hennepin County they should not act until we have Council approval to act. They are receiving pressure from the DNR because it has been a longer process than was foreseen. They would begin negotiating tomorrow if the Council passed it tonight. Young said if we are forced by the federal government to mitigate, then we must do it;however,before we make the assumption we have to mitigate,he would want direct communication from the federal government that we have to do it. Duckstad asked if the cost we would have to bear is based on an appraisal. Lothammer said all the properties were appraised right away. We needed to find the property to acquire that met the dollar amount and was a comparable use and have that appraised by the same federal standard of appraisal. It is almost impossible to get exactly equal to equal value,but we can receive credits going forward on other projects. This property is as close as we can get in that formula. Duckstad agreed we should put this off and attempt to get this information before we make a final decision. Dietz said he was not sure we have standings here. This is a Hennepin County project and in the end this is a requirement of LAWCON through the DNR on Hennepin County. We are being asked to agree that this is a reasonable conclusion to their request. He thought we would have to challenge this in concurrence with Hennepin County. Young said he still thought it is something that can be looked into. Lotthammer said there is no hard deadline for this. We can start to get the ball moving to get a response from the Dept. of the Interior and bring it back so we stay on track. Nelson asked how long this would take and how much would it cost. She said it fits into a very nice piece in our parks and meets the requirements. She would like an estimate of how long it would take and how much it would cost. She was not willing to spend a lot of money or take months to accomplish this. Young said he wanted more information than we have today unless there is a firm deadline. Lotthammer thought it is reasonable that we could come back at the next meeting with a response or at least an estimate of the response time. Case said he was very uncomfortable with waiting. He could accept that at the next meeting some resolution takes place,but there are variables out there that could cost money. He would like a motion on the floor at the next meeting. Young said he would like to know from staff that there would be an additional cost if we don't act on this tonight. Dietz said he didn't know. Lotthammer said this comes down to being a real estate transaction, and he CITY COUNCIL MINUTES February 16, 2010 Page 19 was not in a place to speculate. The Hennepin County acquisition staff understood the appraisal and we will get the best price for the purchase of it. Dietz said if this were not 6(f) land the rules are that Hennepin County just takes that property from us as is the case on any other project. Only on 6(f) are they obligated to do anything about replacing the land. We are trading 1-1/2 acre of land for property that is in a more favorable location for our parks system. E. REPORT OF PUBLIC WORKS DIRECTOR F. REPORT OF POLICE CHIEF G. REPORT OF FIRE CHIEF H. REPORT OF CITY ATTORNEY XV. OTHER BUSINESS XVI. ADJOURNMENT MOTION: Duckstad moved, seconded by Aho, to adjourn the meeting. Motion carried 5-0. Mayor Young adjourned the meeting at 9:41 PM.