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08-31-04 WSw f August 31, 2004 Page 1 MINUTES CITY COUNCIL WORK SESSION -August 31, 2004 A work session of the Hopkins City Council was called to order by Mayor Gene Maxwell at 6:30 p.m. on August 31, 2004, at the City Hall. Council members Brausen, Johnson, Rowan and Thompson were present. City personnel present were: Acting City Manager Jim Genellie; Public Works Director Steve Stadler; Utilities Superintendent Mike Lauseng; and Finance Director Christine Harkess. Also present were: Tony Heppelmann of WSB & Associates and Brent Lindgren of Hennepin County Transportation Department. Water Meter Replacement Mr. Genellie briefly summarized the history of water meter replacement. Under present discussion was the issue of payment for water meters larger than 1". He said there are several options for the Council: following the proposed ordinance and not paying for any meter over 1" (no cost to the city); paying for replacement of larger meters for condominiums and town homes (costing an estimated $78,000); giving a credit to town homes and condominiums equal to the cost of a 5/8" meter for each larger meter they replace (costing an estimated $42,000). Answering Council member questions, Mr. Lauseng said city personnel cannot replace the larger meters as they require plumbing which would need to be contracted out; Mr. Genellie noted labor costs were not included in the estimated costs as they were too difficult to estimate; Mr. Lauseng said inspection is part of the process when city personnel take the transponder over and get a base reading. He noted that his crews read 3400 resident meters in the time it takes to read 400 commercial meters. Mr. Genellie said transponder costs are the same for all meters up to l lh". Mr. Stadler estimated the cost of a compound one -that is, one with two transponders - at $545. Mayor Maxwell asked those in the audience how many meters they would need replaced: of those present over 80 1'h" and 16 2" meters would be needed. He then invited comments from the audience. One person commented this amounted to "another double charge" as the complexes don't get garbage and snow removal; Mr. Lauseng noted they do not get charged for those services. Someone asked about meters which had been retrofitted; Mr. Lauseng said most meters since 1990 would be a current model and added the national average for a water meter is 15 years. Mayor Maxwell added recalibration costs can be equal to the cost of a new meter. Mr. Lauseng added if any resident damages a meter through negligence, such as water pipes allowed to freeze, they must pay for the replacement. Someone commented that the charge for a larger meter would be more economical when divided among the number of residents. Another added that is why they feel discriminated against; the city pays $400 for each homeowner, then won't pay much less for each complex resident. Mr. Lauseng said the city had not said what size meters to install; building owners chose larger meters because they were more economical per unit. Mr. Brausen added the issue is simply to verify meters, and the inspection process would cost owners the same as a new meter. Mr. Genellie added that replacement of larger meters would not be cost effective for the city because of the need for outside plumbers. The owner of an apartment building felt the new ordinance should include apartments as well as condominiums and town homes as they also pay taxes. Mr. Lauseng noted owners of all new homes must pay for their own meters. An audience member commented the large meters save the city billing costs, and added "1-inch meters", not a August 31, 2004 Page 2 "single-family," should be the terminology used in the ordinance. Someone commented the ordinance was written in 1974; it needs to be "brought to the future" and recognize that condominiums and town homes are homesteaded just like single-family residences. Answering a complaint that the Council was treating people as objects, Mr. Brausen said the Council was trying to make sure every user was paying fairly for the water they used. They felt it was fairer to ask users to upgrade than to enforce the testing requirement already in place, which would cost about the same as a new meter and leave many residents having to pay again for a new meter if the old one did not pass the requirement. Answering audience questions, Mr. Maxwell said the time frame for replacing meters has been extended to 4 years; the proposed fine would be prorated for that length of time - if eight meters needed to be replaced, 2 would need to be replaced or subject to fines each year. Mr. Lauseng added the process would be the same as that for single-family residence fines. Mayor Maxwell then closed the public discussion. Mr. Thompson commented everyone was talking about fairness; single-family homeowners pay much more in taxes than condominium and town home owners. Mr. Brausen said another option for the Council would be to do nothing new but to enforce the requirement for a meter check. He asked about the water rate raise scheduled for 2005; Mr. Genellie said Ms. Yager had estimated that water meter rates be raised three times in the next 10 years. Ms. Yager had said that if the water revenue went up due to more accurate readings one of these raises may not be needed. Mr. Stadler said the new meters would record low flows, such as those caused by leaky toilets, which the older models did not. Mayor Maxwell noted that cost of meters was probably a tax deductible item. He asked about the research into apartments; Mr. Genellie said it was felt apartment buildings were commercial units. He suggested the term "owner-occupied" to make the distinction from condominiums and town homes. Mr. Stadler added county recording as individual owners could also be used. Mr. Maxwell asked what information the Council would want next Tuesday. This included information onrates -why they are what they are, etc.; a history of water consumption; adouble- check that the city has indeed gotten the best possible price break on the larger meters for residents, showing their savings; costs for option 3 with 1" meters; 1'h" meter costs. General Consensus was to have language for option 3 (credit to town homes and condominiums equal to the cost of a regular meter) drafted, Mayor Maxwell suggested using 1" as a baseline. Mr. Stadler noted that if the program passes, a letter would go out. Shady Oak Road Project Mr. Stadler said the presentation was to show basic roadway design and traffic volume options for the proposed widening of Shady Oak Road from Highway 7 to Excelsior Blvd. Mr. Heppelmann said that 3-lane basically means one through lane in each direction plus a central turning lane; 4-lane means two through lanes in each direction plus turning lane. All plans assumed a trail on one side and a sidewalk on the other side. Cross-sections just north of Excelsior Blvd. and just south of Highway 7 would be about the same for both; the middle portion would need 20 feet more right-of--way for the 4-lane option. He added the advisory committee has already recommended that Excelsior Blvd. to Bren Road be upgraded to 4-lane. There will be some takings, but these have not been looked at yet. He showed 2025 traffic simulations for each option noting the 3-lane with a west leg would cause backup to Excelsior Blvd and an average delay of 54 seconds, which is deemed "unacceptable." Answering Council questions, he said presently the roadway is 48-52' and has no .~ • August 31, 2004 Page 3 trail. The 4-lane would be 92 feet with both a trail and sidewalk. Mr. Stadler added this would be equivalent to the upgrade of Excelsior Blvd. Mr. Heppelmann said federal funding would help with the 8' trail costs. Sidewalks are 5-6'. The trail and sidewalk could be combined, but Minnetonka might not approve that. Hennepin County is recommending 4 lanes. The final decision is basically a consensus among the two cities and the county. The 2025 traffic numbers were arrived at by taking present counts, projecting developments, and then estimating. Justification for the west leg, since it does not diminish delay time, is consolidation of merging traffic and shortening of queues; it was first suggested by the Minnetonka city engineer. Mr. Heppelmann asked for feedback from the Council on operations. General Consensus was 4-lane was the only realistic option, although members were concerned about businesses along Shady Oak. They all agreed alignment issues were critical and that buffering issues were important. Mr. Rowan asked for a good differentiation between "taking the building" and "expansion will be close." Ms. Johnson asked if the option of helping businesses use their present back facade as the new front entrances with new approaches to them would be feasible. Mr. Heppelman added the choice between 3- or 4-lane had not been taken to Minnetonka as they seemed to assume it would be 4-lane. Hennepin County Community Works will pay for a study to look at redevelopment possibilities with the alignments. Answering questions, Mr. Lindgren said projected costs are $8 million or more. Mr. Stadler said he felt no work would start ti112007/2008. They will come to a work session in October with some alignment options. A joint meeting with Minnetonka will be held in November. Preliminary Budget and Levy Mr. Genellie introduced Finance Director Christine Harkess to the Council. She said she had rechecked Ms. Yager's figures and found them "right on" - a 7.65 % levy would equal a 1 increase in taxes. The low increase is due to the increased tax capacity (over $2 million), which is largely due to decertification of a TIF district plus some new construction. Mayor Maxwell asked what other cities were passing for levies and was told Plymouth is passing a 10 % levy, Minnetonka and Golden Valley a slightly lower levy. Mr. Genellie added they are passing higher levies because they are afraid they will not get the market value credit. He estimates that about a 7 % levy would result in a zero increase for the "average homeowner," adding some would see increases and some decreases at that level. Ms. Harkess said this year's budget is a strong argument for TIF districts -the big rise in tax capacity means homeowners get a big break in their taxes. If the city had not looked far ahead, there would not be this break for them now. Mr. Brausen commented she should stress that in her presentation at the Council meeting. General Consensus was that by next Tuesday the Council needs the debt levy options. They want a preliminary levy resolution that will result in a zero increase in taxes for the average homeowner. Ms. Harkess said the Council would need to pass a resolution covering the amount of the HRA amount that would come from other sources and the HRA has to pass a resolution for the HRA levy. It was agreed the Truth in Taxation hearing should be December 13 at 6:30 p.m., with a possible continuation date of December 20. Other Mayor Maxwell noted Ms. Elverum had had a baby girl. Mr. Genellie said Mr. Stobbe thinks his basement flooding is due to the city. City staff is August 31, 2004 Page 4 confident this is not the case. It will probably go to conciliation court. Mr. Thompson asked about the Interlachen property issue. Mr. Genellie will check on Mr. Stadler's progress on getting easement information. Mr. Brausen moved adjournment. Ms. Johnson seconded. On a 5-0 vote, the meeting adjourned at 9:45 p.m. Kasey Kester, Secretary ATTEST: Eugene J axwell, Mayor