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02-11-06 WSApril 11, 2006 Page 1 MINUTES CITY COUNCIL WORK SESSION -- April 11, 2006 A work session of the Hopkins City Council was called to order by Mayor Gene Maxwell at 6:30 p.m. on April 11, 2006, at the City Hall. Council members Bruce Rowan, and Kristi Halverson and Cheryl Youakim were present. Councilmember Jay Thompson arrived at 8:45. City personnel present were City Manager Rick Getschow, Public Works Director Steve Stadler, and Facilities Manager Jay Strachota. Also present were Robert Winge, Nate Stulc and Daniel Salzwedel of the Hennepin County Assessor's Office and Fran Hesch and Vlad Gruin of the Depot. County Assessor Informational Meeting City Manager Getschow said the assessors were present to explain how they work in Hopkins. Mr. Winge said the Department of Revenue has adopted other policies besides the local board of appeal. As part of this, at least one member of the local board must go through an education course, and all assessors go to a code of ethics class. Citizens can come to the "open book" meeting and get explanations from the assessors; this really is an education process. Later he added that even if they do not attend the open book session, citizens can still appeal their assessment to a Board of Appeals. Mr. Stulc is the residential assessor and has completed two assessments of Hopkins. In 2005 he assessed condos, townhouses, etc. (1,912 parcels). Updates were entered into the computerized mass appraisal system. The rest of the city rates were based on sales and growth from the prior year plus an added percentage. In 2006 he did another third of Hopkins (1,069 parcels). In 2007 he will cover the remaining 1,305 parcels. In 2006 Hopkins had 5,013 parcels valued at $1,617,989,300; of this $18,386,000 was new construction and improvements. There was an overall increase in value of 5.5%. Mr. Salzwede assesses Hopkins' industrial and commercial properties, including apartment buildings. Later Mr. Winge noted that any building with more than three apartments is a commercial building; duplexes, for example, are still considered residential. At the end of 2004 Mr. Salzwede personally viewed all the apartment buildings. His work is different from residential assessments in that it is "hands on" every year. When he started, land values downtown were at $8/sq. ft., which was much too low. However, the total values were not far off. He has raised the land values and often lowered the building values. Current values for Mainstreet lots are $20/sq. ft. He noted later that Mainstreet values depend on the location; near the ends they are at $14/sq. ft; in the main downtown area they are $28/sq. ft. for corner lots. These re- evaluations have been proven correct by recent sales. In 2005 he went through every Mainstreet business and found a lot of fluctuation in values. This year he went through all industrial properties. In 2007 he will personally inspect the rest of the commercial properties, such as on Blake Road and Highway 7. Overall industrial values were up 7.3% without new construction; commercial was up 11% without construction, and apartment values stayed flat. Mr. Winge noted that all assessed values use a January 2 assessment date. April 11, 2006 Page 2 Mr. Stulc noted that tax notices went out two Mondays ago. They have received T 60 calls, mostly general questions. He did 20 reviews so far. Answering Ms. Youakim, he said last year there were about the same number of calls. Many of the questions arose because the limited market value is catching up with real value as real estate prices are flattening out. Mr. Winge added Lake Minnetonka and Minneapolis property owners are getting the most benefit from LMV. Mr. Winge added 2006 market value, for example, would be based on sales October 1, 2004, through September 2005. A normal ratio would be 90-105%. His appraisers try fora 95% ratio. Mr. Rowan asked how much time is spent evaluating a property. Mr. Winge said it varies, depending if the owner is home to let them in. An outside only appraisal may be 3-5 minutes; an inside appraisal may be up to 2 hours. All owners are sent a letter before their property is appraised. If they are not home, and things look different from the "field cards" in the computer, another letter is sent, asking for an appointment. If they receive no response, they will do the best they can from the outside view. They always check any permits issued by the city during the previous year. Answering Mayor Maxwell, Mr. Stulc said a single high sale won't affect neighbors' values; the department uses all sales for the area, and also checks if an extra high sale is because of an unusually expensive house for the area. Mr. Winge noted the department does assessments for 25 cities. Mr. Stulc added Hopkins is much like the others for residential properties. Mr. Getschow suggested the assessors meet with the Council each year. The three assessors said they would be willing to do that. Depot Coffee House Update Mr. Strachota said that a new model is on 60-day trial, starting April 1. It may be decided to bring the coffeehouse and the Teen Center back under one budget. The new Depot Express will not be as broad as Royal Cuisine was. Ms. Hesch said Royal Cuisine pulled out on short notice on January 15. Employees really worked hard to keep the doors open. She suggested they start as a "for profit" LLC; the Board unanimously agreed. She is acting as manager and taking no salary. 100% of the profit will go to the Teen Center, and they will control the budget. He heard just today from a documentary film group that would like to use the Depot as one of 5 examples of teen coffee houses. The Beard group has offered to help set up the books, and have taken all the invoices and made a master inventory list. Now the Depot Express (coffee shop) can find out what is profitable. Levy for Lease money would be used for the Teen Center and building expenses. Mr. Strachota noted there would be one Depot budget, with the Depot Express as a line item. Mr. Gruin said this week a sound booth was built for the Center. Ms. Hesch said nice furniture has been bought at good prices. Stackable chairs are needed to enable renting the space more; several town meetings have been set up. An Alcoholics Anonymous group meets there 6 days a week. The school's marketing class is getting very involved. Answering Ms. Youakim, she said the vending machine money goes directly to the Depot, not the Depot Express. There was general discussion on Three Rivers and what it will do for the Depot as a trailhead. Ms. Hesch said there a few inside items that would really make sense to do right away -such as a water heater, storage, a grill to set off the Depot Express counter April 11, 2006 Page 3 but allow access to the vending machines -- so that trail users could better use the Depot building. Ms. Hesch said Three Rivers had said everything was negotiable when they met together, but the plan has not changed at all. Steve Stadler said he feels everything still is negotiable, but other concerns, such as the LRT, had put the plans on hold for a while. He will convey the Board concerns to Three Rivers. Mr. Getschow added they have told him they want to work with Hopkins and will not do anything without telling us. He will try to get them to attend a Board meeting. Answering Mayor Maxwell, Ms. Hesch said the trial period for Depot Express is 60 days as that is all she and her husband can risk of their own money. However, things look good right now. Washington Avenue MSA Dedication Public Works Director Stadler said staff wishes to designate Washington Avenue from 5th Avenue to 2"d Street NE as a Municipal State Aid Street. As this is already designated for trucks, it would make no changes to traffic. They also wish to remove that designation from the vacated 6th Avenue S and the section of 5th Avenue south of Excelsior Blvd. Only 20% of a city's improved streets can be MSA roads. These changes would put us as close to that limit as possible, maximizing the dollars we get from the state. Later he noted the 2006 return is $15.95 per capita for $281,000. Answering questions, he said the city does not assess for milling, but residents by a MSA road to get a lower assessment rate. The road was checked for condition, and staff feels no work needs to be done in the next five years, with the exception of a possible milling and overlay. The changes are simply to maximize state dollars. No calls have been received from residents notified of the proposed change. A bike trail could still be put alongside the road in the future. As the Council must pass a resolution by May 1 to get the change into the 2005 allotment, he will bring a resolution to the April 18 meeting. General Consensus was to do so. Parking on 10th Avenue Public Works Director Stadler said he had notices hand delivered to about 15 businesses about the proposed change from angle parking to parallel parking on 10tH Avenue. He had received no calls. Answering Mayor Maxwell he said the change is planned for late May. He was not sure if the new Gusto Cafe and Wine Bar had gotten a notice due to the timing. He will be sure to let him know. Other Mr. Stadler showed pictures of the proposed ramp on the east side of City Hall as part of the refurbishing of the building facade. Cost would be about $3,000. Mayor Maxwell asked if lighting would be sufficient. Mr. Getschow said no decision was being made now, and he will be certain copies of the pictures are given to all Council members. Mr. Getschow updated Council on the Opus development. He gave each Council member an AUAR, which is basically an update of the one Medica had done. Tomorrow there will be an open house. Council will make a decision on the AUAR in May. There is a ten day period in which anyone can comment on it. Full text is on the website for anyone to read. No comments can be made at the Council meeting, or the clock would April 11, 2006 Page 4 start up again. However, public can comment on the PUD, can attend future Planning and Zoning meetings, etc. to have more input. Mayor Maxwell commented this should be clarified at the beginning of the Council meeting. Mr. Getschow said over 600 notices had been mailed, it is being published in the paper, and the web site has the complete document. Mr. Rowan commented on Gusto's. Ms. Youakim said a resident had approached her about having the city encourage residents to do cleanup. She suggested there be a proclamation fora "Cleanup Day." The block drop-off was mentioned. Mayor Maxwell said it would be a good topic for the monthly guest column in the Sun Sailor. Ms. Youakim said she had received thank-yous for the proclamation for the basketball teams. Mayor Maxwell made two appointments to commissions. He appointed Ms. Halverson to the Cable Commission, and Ms. Youakim to Caring Youth. Mr. Rowan noted the next Caring Youth awards would be March 22, 2007. On motion by Ms. Halverson and second by Mr. Thompson the meeting adjourned at 9:00 p.m. on a vote of 5-0. Kasey Kester, Secretary ATTEST: Eug J. xwell, Mayor