Anoka City Council

November 18, 2019 (Regular) Page 1 of 17 REGULAR MEETING OF THE ANOKA CITY COUNCIL ANOKA CITY HALL CITY COUNCIL CHAMBERS NOVEMBER 18, 2019 1. CALL TO ORDER Mayor Pro Tem Freeburg called the meeting to order at 7:03 p.m., followed by the Pledge of Allegiance. 2. ROLL CALL Present at roll call: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp. Staff present: City Manager Greg Lee; Police Chief Eric Peterson; Electric Director Greg Geiger; Community Development Director Doug Borglund; Associate Planner Clark Palmer; Finance Director Brenda Smith; Public Services Director Mark Anderson; and City Attorney Scott Baumgartner. Absent at roll call: Mayor Rice. 3. COUNCIL MINUTES 3.1 Minutes of the October 28, 2019, Worksession. Minutes of the November 4, 2019, Regular Meeting. Councilmember Skogquist requested the following corrections: Page 5, last paragraph: “Council consensus was to distribute information to all customers on the program with the intent to cease contributions accounting services to Youth First.” Page 6, Paragraph 3: “Borgie Bonthuis, Anoka, explained the scholarships given to seniors from their organization the Anoka Philotectians…” Page 7, first paragraph: “He shared the example of the Urban Herban Wolfe Deli…” Motion by Councilmember Barnett, seconded by Councilmember Skogquist, to waive the reading and approve the October 28, 2019, Worksession as corrected and the November 4, 2019, Regular Meeting minutes as presented. Vote taken. All ayes. Motion carried. November 18, 2019 (Regular) Page 2 of 17 4. OPEN FORUM 4.1 Anoka Royal Ambassadors. The 2020 Anoka Royal Ambassadors Randi Lindau, Kaitlyn Mateychuk, and Morgan Lindquist said they were pleased to be here to share about the scholarship-based program and thanked everyone for their support. They shared the process of candidacy, offered their help through volunteering in service projects, and said they participate in approximately 120 events throughout the year. They spoke about the importance of the program then shared their current activity involvement and plans for post high school. Councilmember Wesp congratulated them on their work and commented the program has been going on since the 1960s. Councilmember Barnett thanked the Ambassadors for representing Anoka so well throughout the State and for their great work. 4.2 Police Activity Update. Police Chief Eric Peterson said the Police Department used ambassadors for various events and thanked for their work. Shared about recent broken windows in parking ramp overnight, successful in identifying the suspect and valuable cameras helped solve. Shared about crime-free rental licensing update, Nicole Neis Crime Prevention Specialist of the Year with crime-free rental and dedication and background have paid huge dividends. K-9 Barrett passed away due to ongoing health issues and appreciated his work. OTHER INFORMATION UNDER OPEN FORUM Ed Evans, 1186 Benton Street, thanked the family members and volunteers who help the Ambassador program each year then shared comments about speed limit changes on Ferry Street, and asked why the change occurred as this only continues to increase speeds and decrease safety. Chief Peterson responded the speed limit changed after the Champlin Highway 169 project was complete and the limit was set by the State after conduction of a speed study. He said he would look into any speed related accidents but did not believe there had been any since the change. Engineering Technician Nelson said the Highway 169 project raised the findings which cannot be reverted back to former studies and that a new study would be required. November 18, 2019 (Regular) Page 3 of 17 5. PUBLIC HEARING(S) 5.1 Stormwater Rate Increase RES/Approving a Stormwater Rate Increase. RESOLUTION Finance Director Brenda Smith shared a background report stating annually the City Council reviews the City utility rates during the budget process. For 2020, staff is recommending an increase in the stormwater rates beginning in January. The City Charter requires the City Council to hold a public hearing on rate increases to allow the public to comment on the proposed changes. The most recent stormwater rate increase was in 2019. At that time, rates went up $.40 per month. Finance is recommending an increase in the current rate to reduce future debt service needs and to provide resources for the street renewal projects included in the Capital Improvement Plan forecasts. Finance is also recommending rate increases for stormwater in 2021 through 2022 to pay for planned infrastructure improvements. Councilmember Skogquist said the focus of the new rate was to cover the increased street work and pay for the debt but asked what other projects are planned for this increase. Mr. Nelson said the other projects included the 2021 SRP project on Van Buren Street and 6th and 7th Avenues. Councilmember Wesp asked about the area of renewal and market value impacts if not completed. Ms. Smith said she was unsure but said the benefits exceeded the assessment and would share data from the City Assessor that outlines that point. Councilmember Wesp said the increase from last year was 40 cents and asked what changed from last year to this year. Ms. Smith said nothing changed except the increased SRP significantly which would have to be paid back to cover the debt and restore reserves. Councilmember Wesp spoke about the importance of keeping costs as low as possible moving forward but also acknowledged the balance and need for street renewal because streets affect everyone in the community. Councilmember Barnett referred to differences in contractual services year over year as they have decreased then thanked staff for bringing this forward annually and not recommending increases more than necessary. Ms. Smith said she would verify the contract with the Metropolitan Council as the amounts have decreased. Mayor Pro Tem Freeburg said rate increases are difficult to implement but were only increased as needed, adding as costs continue to rise rates have to follow. November 18, 2019 (Regular) Page 4 of 17 Councilmember Skogquist asked how much of this increase was due to increases in the SRP program. Ms. Smith said the amount was approximately the same as the City bonds for larger projects but smaller projects still have to have increased rates. Mayor Pro Tem Freeburg opened the public hearing at 7:33 p.m. City Attorney Scott Baumgartner suggested an order of public hearings in order to allow for public comment for all. Mr. Evans commented how the Council said increases were not necessary but outlined increases in stormwater of 8.1%, an additional 4.9% general tax increase, an added sewer tax of 6.1% for a total increase of 19.1% for the City of Anoka. He noted that in addition the HRA can also tax which is proposed at 8.2% therefore resulting in a 27.3% total increase in taxes in Anoka. Ms. Smith explained cost of City services in total stating in 2019 a house valued at $238,000 paid $114 in total City taxes and for 2020 would average $123 per household or $9 increase which was 7.8% increase. She explained the contract with the Metropolitan Council was for sewer costs and not stormwater costs then said the proposed increase should generate about $54,000 additional revenues annually with a proposed increase in the stormwater rate of $0.35 per month per residential lot with the other categories. Being no further comments Mayor Pro Tem Freeburg closed the public hearing at 7:39 p.m. NOTE: By motion from Councilmember Wesp, which was seconded by Councilmember Barnett, and by a unanimous vote of the Council, agenda item 9.1 was moved up on the agenda and acted upon at this point. Motion by Councilmember Skogquist, seconded by Councilmember Barnett, to adopt a resolution relating to adoption of a stormwater utility rate increase for 2020. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 5.2 Sewer Utility Rate Increase RES/Approving a Sewer Utility Rate Increase. RESOLUTION Ms. Smith shared a background report stating for 2020, staff is recommending an increase in the sewer utility rate beginning in January. The most recent sewer rate increase was in 2019 and rates were increased about $1.60 per month for an November 18, 2019 (Regular) Page 5 of 17 average water user. She said staff is also recommending rate increases for sewer in 2021 and 2022 to pay for planned infrastructure improvements and increases in operating costs. She noted the proposed increase should generate about $161,000 additional revenues and that disposal costs are projected to be up $135,000 in 2020. The proposed increase in the sewer rate is $1.43 per month for the average water user for residential properties which is about a 6.1% increase in an average monthly sewer utility charge. Councilmember Wesp asked about defining competitive charges with other local governments. Ms. Smith explained staff reviews all rates other cities charge for comparison to ensure we are competitive. Councilmember Wesp inquired about the lift station for northeast corner of the City and the importance that it continues to operate and how plans for a new one should begin now to avoid disruption. Public Services Director Mark Anderson explained how the lines in 7th Avenue and 38th Avenue feeds into the 21-inch line just west of City Hall and was at 60% of capacity and the proposed project is one that would divert the discharge across the Rum River into the Metropolitan Council’s line. Councilmember Barnett said the City has no say in disposal charges and since those fees will continue to increase are being pragmatic enough this year so that we have enough in the next five years if we have to bond $3 million for a lift station. She said we are a uniquely aged city with unique issues and if rates are not competitive then she understood the reasons why. Ms. Smith said staff can project for the next 20 years to cover future debt and infrastructure costs and that the budget was looking good with a range between 5%-7% increase up to 2025. She said staff intends to return year after year with small increases rather than one large increase. Councilmember Freeburg asked if we have had sewer lines break in the past. Mr. Anderson replied he did not recall any breaks but did recall some station failures then shared the benefits of different material types. Mayor Pro Tem Freeburg opened the public hearing at 7:54 p.m. Being no comments Mayor Pro Tem Freeburg closed the public hearing at 7:54 p.m. NOTE: By motion from Councilmember Wesp, which was seconded by Councilmember Barnett, and by a unanimous vote of the Council, agenda item 9.2 was moved up on the agenda and acted upon at this point. Motion by Councilmember Barnett, seconded by Councilmember Wesp, to adopt a resolution relating to adoption of a sewer utility rate increase for 2020. November 18, 2019 (Regular) Page 6 of 17 Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 5.3 Recycling Rate Increase RES/Approving a Recycling Rate Increase. RESOLUTION Ms. Smith shared a background report stating staff is recommending an increase in the recycling rates beginning in January as follows: Single Family Households from $3.40/mo to $3.90/mo an increase of $0.50 or $6.00/year and Multi Family Households from $2.70/mo to $3.10/mo an increase of $0.40 or $4.80/year. She said the proposed rate increases are to cover a new recycling processing charge from Republic Services. This new charge is due to the change in commodity sales, processing rates, and/or residual costs and will be reviewed annually. Ms. Smith noted the proposed increase should generate about $33,000 additional revenues annually. Councilmember Barnett said she was surprised the increase was this low with the recycling handling issues occurring in China and encouraged staff to continue to keep the rates as low as possible. Mayor Pro Tem Freeburg opened the public hearing at 7:57 p.m. Being no comments Mayor Pro Tem Freeburg closed the public hearing at 7:57 p.m. NOTE: By motion from Councilmember Barnett, which was seconded by Councilmember Skogquist, and by a unanimous vote of the Council, agenda item 9.3 was moved up on the agenda and acted upon at this point. Motion by Councilmember Freeburg, seconded by Councilmember Skogquist, to adopt a resolution relating to adopt of recycling rate increase for 2020. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 6. CONSENT AGENDA Motion by Councilmember Wesp, seconded by Councilmember Barnett, to approve Consent Agenda 6.1 through 6.2. Councilmember Barnett noted the regular City worksession would be held on December 9 because of the holidays. November 18, 2019 (Regular) Page 7 of 17 Councilmember Wesp noted there may be a quorum of Council on December 2 at Zion Lutheran Church for their annual lutefisk dinner and should be posted accordingly. 6.1 Approve Verified Bills. 6.2 Revising and Setting Council Calendars. Vote taken. All ayes. Motion carried. 7. REPORTS OF OFFICERS, BOARDS AND COMMISSIONS 7.1. Planning Items: 7.1.A. RES/Approving a Conditional Use Permit and Site Plan for Anoka Middle School for the Arts, Washington Campus, 2171 6th Avenue. RESOLUTION RES/Approving a Variance for Anoka Middle School for the Arts, Washington Campus, 2171 6th Avenue. RESOLUTION Associate Planner Clark Palmer shared a background report stating on behalf of the Anoka-Hennepin School District, Anderson-Johnson Associates, Inc. is proposing to add two building additions and expand the parking lot at the Anoka Middle School for the Arts, Washington Campus. The property is zoned R-1 Low Density Residential. Schools and public buildings are allowed in the zoning district with approval of a Conditional Use Permit (CUP) and Site Plan Review application. Additionally, the applicant is requesting a front yard setback variance of 4.66 feet from the 35-foot front yard setback along the east property line for one of the additions. He outlined the proposed improvements which included an approximate 9,000 square foot gymnasium addition at the northern portion of the property along Van Buren Street, an approximate 9,000 square foot classroom addition at the southeast portion of the property along 6th Avenue and School Street, a reconfigured parking lot at the southern portion of the property and new parking lot at the center of the site, and a minor modification to the off-site parking lot located at the southeast corner of Van Buren Street and 6th Avenue. He said the Planning Commission reviewed the application and held a public hearing on November 6, 2019, and recommended approval of the application with conditions. Councilmember Skogquist said he had no issues with the proposed setbacks but asked why gate access was included as a condition. Mr. Palmer said this was a carryover from the land use application from the interim use permit but noted the site was surrounded on all four sides by public right-of-way and could be used as November 18, 2019 (Regular) Page 8 of 17 a shortcut. It is good to have secure access to the site. He said the school spoke about responsibility to close the gate on non-school days but the goal was to routinely close them. Councilmember Skogquist asked if this will function as the bus drive-through versus parking on 6th Avenue and inquired about materials for the gymnasium as either full brick or tip-up materials. Mike Craft, Mike Craft Architects, responded that parking along the street will largely be as it is today but would have more room and in terms of materials the intent is brick used in 2016 which was close to the original 60-year old brick and contained a mixture of different colors that match the brick as best as possible to the original building. Councilmember Barnett asked if the Planning Commission approved the 8-foot fence from Van Buren to School Street and inquired about affecting the existing fence. Mr. Palmer said the existing privacy fence by the portable classrooms had privacy screening and staff was asking for continuation of that fence to the new driveway and clarified if we are replacing the 6-foot fence it would all be 8-foot instead. He said a public hearing was held with the neighborhood notified and some were pleased to see the increased fence height to eight feet. Councilmember Barnett asked about privacy screening for the two ancillary lots east of 6th Avenue. Mr. Palmer shared photos and confirmed no changes would occur for those lots then noted work would begin 2021. Motion by Councilmember Skogquist, seconded by Councilmember Barnett, to adopt a resolution approving a Conditional Use Permit and site plan review for 2171 6th Avenue. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. Motion by Councilmember Barnett, seconded by Councilmember Wesp, to adopt a resolution approving a variance for 2171 6th Avenue. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 8. PETITIONS, REQUESTS AND COMMUNICATION None. 9. ORDINANCES AND RESOLUTIONS 9.1 Stormwater Rate Increase RES/Approving a Storm Rate Increase. November 18, 2019 (Regular) Page 9 of 17 ACTED UPON AFTER THE PUBLIC HEARING 9.2 Sewer Utility Rate Increase RES/Approving a Sewer Utility Rate Increase. ACTED UPON AFTER THE PUBLIC HEARING 9.3 Recycling Rate Increase RES/Approving a Recycling Rate Increase. ACTED UPON AFTER THE PUBLIC HEARING 9.4 RES/2020 Combined Street Improvement Project; Approve Feasibility Report and Set Public Improvement Hearing (Monroe Area SRP Project). RESOLUTION Engineering Technician Ben Nelson shared a background report stating a resolution was adopted by City Council on July 15, 2019, authorizing the preparation of a feasibility report for the 2020 Combined Street Improvement Project. The feasibility report includes three project areas; Monroe Area Street Renewal Program (SRP) Project, Bob Ehlen Area Street Renewal Program (SRP) Project, and the Street Surface Improvement Project (SSIP). The structure of the report allows Council to take action on all or separately for each project area throughout the public improvement project process. At the September 23, 2019 work session meeting, discussion occurred about transitioning the enhanced Main Street Streetscaping to a residential streetscape. Council provided unanimous consent that there needs to be some type of transition for the streetscaping with a conservative approach. Discussion also occurred on the proposed bump-outs and there were no objections to include or not to include the bump-outs but Council was comfortable with most options on concept option 2. Mr. Nelson shared business and neighborhood open houses were held at Green Haven Golf Course and Event Center on October 17, 2019, to solicit input on operations of the local businesses and to answer questions from the neighborhood about the proposed improvements. Overall, businesses were in favor of the project as well as residents but some concerns were raised regarding staging, communication, and draft assessment roll and payment option. Mr. Nelson reviewed the proposed streets, alley, and parking lot proposed to be included in this Monroe Area SRP Project, including the city owned Bridge Square parking lot. The proposed improvements include removing the concrete center median, reclaiming, grading and paving a new bituminous surface at an estimated construction cost of $158,000. Council shall be aware, since the feasibility report was authorized, that staff presented the project to the Anoka Business and Landowners Association (ABLA) at the October 1, 2019 board meeting. ABLA agreed with the overall project improvement and was not opposed to the bump-outs at the intersections along the north side of Monroe November 18, 2019 (Regular) Page 10 of 17 Street. Discussion was held about the improvements to the Bridge Square parking lot, which included the possibility of have the parking lot enhanced to the downtown “real classic” appearance which includes brick pavers like the City Hall parking lot plaza area completed in 2013. At the conclusion of the discussion, staff offered to provide the Board an estimate for the cost of enhancing the parking lot to the downtown “real classic” look and to present the costs at the November board meeting. At the November 5, 2019, staff presented the estimated cost of $553,000 to enhance the Bridge Square parking lot to the “real classic” vision. The ABLA Board held discussion on the parking lot enhanced improvements and whether to have the City move forward with the current plan or to ask the City that the parking lot be enhanced to the downtown “real classic” appearance. The Board passed a motion 5 to 3 stating that ABLA recommends the downtown “real classic” pavers for the Bridge Square parking lot, to remove the parking lot improvements from the 2020 Monroe Area SRP project, and for the City to complete these improvements within three years. Staff is recommending removing the Bridge Square Mall parking lot from the project and to continue conversations with City Council about an independent parking lot project for Bridge Square during 2021 Capital Improvement Program budget discussions. This project is proposing a number of new infrastructure changes which include proposed curb bump outs at the intersections along Monroe Street, sanitary sewer extension on 4th Avenue between the mid-block alley and Monroe Street, sidewalk extension on the east side of 4th Avenue from the mid-block alley to Monroe Street, and Monroe Street width revisions to a proposed 40-foot width. Councilmember Wesp confirmed the non-residential per foot rate doubled from $19 to $38. Councilmember Barnett asked about the Bridge Square parking lot paid by TIF and if delaying construction would impact those funds. Mr. Nelson said the parking lot is not inside a TIF district and only 1st to 2nd Avenues and Monroe Street and a small portion of 400 feet 2nd to 3rd Avenues are included in a TIF district. Councilmember Skogquist asked if we are bound by ABLA’s request to do the work within three years and if so, how do we pay. Mr. Nelson said we are not bound and money would have to be identified during the 2021 CIP. Councilmember Barnett referred to ABLA’s input and their request for paver bricks instead of pavement and if we could seek partnerships instead for this work. Mr. Nelson said ABLA would be willing to do a partnership for the work but that they currently do not have the funds now due to recent lighting project and asked the City pay for the pavers instead. Mayor Pro Tem Freeburg spoke about ABLA’s concerns regarding safety during special events and having the public crossing the street. November 18, 2019 (Regular) Page 11 of 17 Councilmember Barnett said funding for this work would only continue to increase over time and suggested continuing to plan for the pavement at this time if no one else is able to partner, adding it could be difficult to identify funding later on. Councilmember Wesp asked about the current parking lot condition and confirmed the work would just be redoing the parking lot and not redoing any pavers. Mr. Anderson said the project has been on the City’s plans for a while due to complaints and could be delayed then added ABLA believes some businesses may not survive project staging. Mayor Pro Tem Freeburg asked how long the project would take. Mr. Nelson said they could look at staging options for the small surface lot which would be more expensive to do in the future but at that point could include additional items such as power pedestals, water availability for plants and food trucks. Mr. Lee said there is no way to accelerate the project just for the parking lot due to the equipment required for the work, adding it would disrupt the entire summer and recommended the Council break out the projects separately and continue to hold discussions with ABLA for partnership opportunities. Mayor Pro Tem Freeburg said ABLA has been a good partner and understands the businesses’ need but asked how large an entertainment district and do we really want in Anoka. Mr. Lee said in three years many of these questions will be answered and will allow us to have a better idea of the needs. Motion by Councilmember Wesp, seconded by Mayor Pro Tem Freeburg, to adopt a resolution for the 2020 Combined Street Improvement Project; Approve Feasibility Report and Set Public Improvement Hearing (Monroe Area SRP Project) removing the Bridge Square parking lot from the proposed project. Councilmember Skogquist referred to the area in front of Sandburg School that has a mostly grass boulevard with the exception of the front steps, adding this area is a problem due to salting and requested an alternative to consider prior to the next meeting. Mr. Nelson shared comments about maintenance and the need for irrigation. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 9.5 RES/2020 Combined Street Improvement Project; Set Assessment Hearing (Monroe Area SRP Project). RESOLUTION November 18, 2019 (Regular) Page 12 of 17 Motion by Councilmember Skogquist, seconded by Councilmember Barnett, to adopt a resolution for the 2020 Combined Street Improvement Project; set Assessment Hearing (Monroe Area SRP Project) removing the Bridge Square parking lot from the proposed project. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 9.6 RES/2020 Combined Street Improvement Project; Approve Advancement of Municipal State Aid Funds (Monroe Area SRP Project). RESOLUTION Mr. Nelson shared a background report stating as part of the 2020 Combined Street Improvement Project (Monroe Area SRP Project), staff is proposing to reconstruct Second Avenue, Third Avenue and Forth Avenue, from Monroe Street to East Main Street and Monroe Street from Second Avenue to Fifth Avenue which are part of the City’s Municipal State Aid (MSA) routes. A portion of the street construction and storm sewer improvements are proposed to be funded with the advancement of MSA Funds. The City of Anoka could utilize State Aid funds to finance a portion of the cost for the reconstruction of Second Avenue, Third Avenue Forth Avenue, and Monroe Street. State Aid encourages municipalities to utilize their available State Aid Funds and has developed rules that promote advance encumbering of future funds. One of the rules developed is a low balance incentive, which redistributes excess unencumbered construction funds to all municipalities whose construction fund balance is less than one times their January construction allotment of the same year. Anoka’s 2020 estimated low balance incentive is $82,800. As part of the process to reserve these available funds, cities must submit a standard resolution requesting said funds and agree that repayment will be derived from future accruals from their Municipal State Aid Construction Account. Motion by Councilmember Skogquist, seconded by Councilmember Wesp, to adopt a resolution approving the 2020 Combined Street Improvement Project; Approve Municipal State Aid Funds (Monroe Area SPR Project). Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 9.7 RES/Approving Purchase Agreement, City’s Purchase of 2825 Fairoak Avenue. RESOLUTION Community Development Director Doug Borglund shared a background report with Council stating the City has identified this property for acquisition in the Highland Park neighborhood. The City would demolish the existing buildings on November 18, 2019 (Regular) Page 13 of 17 site and utilize the property for roadway/redevelopment purposes. The City obtained a real estate appraisal for 2825 Fairoak Avenue determining its value at $205,000.00. Through the negotiation process the City proposed to the property owner that we tie two property negotiations together, but with separate closing dates. The property owner accepted the idea. Both parties agreed to use Zillow valuations as purchase prices that would be in lieu of a separate appraisal with a total value of $408,000.00. During negotiations of the two purchase agreements, the property owner asked for the individual parcel purchase prices to be allocated with $300,000 for 2825 Fairoak, and $108,000 for 2923 Fairoak. This was a condition of the sale negotiations. The seller has accepted the City’s offer of $300,000.00 and intends to close on or before December 15, 2019. He noted this property is ineligible for moving expenses in this case or replacement housing payment (RHP). Councilmember Skogquist asked about separate closing dates and sellers’ opinions and the possibility of paying too much for one property and asked which property was closing first in case there were repercussions. Mr. Baumgartner said the purchase agreement contains a default provision contingent upon each property closing to avoid that concern. Motion by Councilmember Barnett, seconded by Councilmember Wesp, to adopt a resolution approving purchase of real property, 2825 Fairoak Avenue. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 9.8 RES/Approving Purchase Agreement, City’s Purchase of 2923 Fairoak Avenue. RESOLUTION Mr. Borglund shared a background report with Council stating the City has identified this property for acquisition in the Highland Park neighborhood. The City would demolish the existing buildings on site and utilize the property for roadway/redevelopment purposes. The City did not obtain a real estate appraisal for 2923 Fairoak Avenue. The City proposed to the property owner that we tie the two property negotiations together, but with separate closing dates. The property owner accepted the idea. Both parties agreed to use Zillow valuations as purchase prices that would be in lieu of a separate appraisal with a total value of $408,000.00. During negotiations of the two purchase agreements, the property owner asked for the individual parcel purchase prices to be allocated with $300,000 for 2825 Fairoak, and $108,000 for 2923 Fairoak. This was a condition of the sale negotiations. The seller has accepted the City’s offer of $108,000.00. The property would close on or before May 30, 2020, and was is eligible for moving expenses in this case and RHP. Motion by Councilmember Wesp, seconded by Councilmember Barnett, to adopt a resolution approving purchase of real property, 2923 Fairoak Avenue. November 18, 2019 (Regular) Page 14 of 17 Councilmember Barnett noted staff did not obtain an appraisal for this property and the previous property but an appraisal fee was still reflected. Mr. Borglund confirmed Zillow was used as agreed by both parties and that he will correct those references in both Items 9.7 and 9.8. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 9.9 RES/Approving Purchase Agreement, City’s Purchase of 762 Jerome Street. RESOLUTION Mr. Borglund shared a background report with Council stating the City has identified this property for acquisition in the Highland Park neighborhood. The City would demolish the existing buildings on site and utilize the property for roadway/redevelopment purposes. The City has obtained a real estate appraisal for 762 Jerome Street determining its value at $135,000.00. After reviewing the property owner’s financial investments in the property, it has been determined that a sale at the appraised value would be a loss for the property owner and would not be acceptable to the owner. The City has agreed on a value that is acceptable to the property owner and consistent with prices the City has been paying for property in the subject neighborhood. The seller has accepted the City’s offer of $195,000.00. The property is scheduled to close on or before December 15, 2019, and this property is not eligible for moving expenses or RHP. Councilmember Barnett asked about costs for clean-up prior to demolition. Mr. Borglund said there would be no additional charges for clean-up as it was included in the demolition as well as environmental review. Councilmember Skogquist said he will support the purchase but cautioned about as acquisitions gets closer prices could be increased and then the City becomes forced to purchase property. Motion by Councilmember Wesp, seconded by Councilmember Skogquist, to adopt a resolution approving purchase of real property, 762 Jerome Street. Councilmember Wesp said this is a challenging neighborhood and that the City has been working hard to acquire parcels to develop a vision and stressed the importance that future Councils continue this plan. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. November 18, 2019 (Regular) Page 15 of 17 9.10 RES/Approving Cancellation and Release Agreement Between the City of Anoka and U.S. Home Corporation (Lennar). RESOLUTION Mr. Borglund shared a background report U.S. Homes Corporation (Buyer) entered into a purchase agreement with the City of Anoka (Seller) on May 9, 2017 to purchase real estate property from the City of Anoka. The Seller and the Buyer have mutually agreed to cancel the Purchase Agreement according to the terms of the Agreement. Motion by Councilmember Barnett, seconded by Councilmember Skogquist, to adopt a resolution approving cancellation and release agreement between the City of Anoka and U.S. Homes Corporation. Upon a roll call vote: Mayor Pro Tem Freeburg, Councilmembers Barnett, Skogquist, and Wesp voted in favor. Motion carried. 10. UNFINISHED BUSINESS None. 11. NEW BUSINESS None. 12. UPDATES AND REPORTS 12.1 3rd Quarter Financial Report. Ms. Smith shared the 3rd quarter financial report, stating revenues were down $707,000 compared to 2018 then reviewed reasons for this decrease. She said total expenditures were up $295,000 compared to 2018 which were due to employee compensation, purchase powers, and other reasons. She stated government fund assets were $11 million and liabilities were $13.7 million and the current fund balance was $11 million with $11 million unrestricted and $13.8 available for spending. Ms. Smith reviewed the enterprise funds of $73.9 million with liabilities of $7.3 million, proprietary funds equity of $73.9 million, general fund revenues up $35,000 from last year and expenditures up $259,000 over 2018. She reviewed trends and enterprise funds that show a net income with the exception of recycling, adding while electric revenue is down golf revenue has increased. She reviewed operating income, internal service funds, cash and investments and holdings and said the City continues to plan and prepare for the future. November 18, 2019 (Regular) Page 16 of 17 Councilmember Wesp asked if the sale of the storage unit property was reflected in the report or was it reflected in 2018. Mr. Borglund confirmed the storage unit property and Kwik Trip were both sold in 2018. Ms. Smith said those sales would have been reflected in park capital. Councilmember Wesp asked about the influx of expenditures in 2019 budgeted at $123,000 compared to 2018 at $80,000. Ms. Smith said she would gather data to share but noted over the last couple years Council approved payment for the annual holiday dinner and employee appreciation events. Mr. Lee noted this amount also includes staff time for the communication coordinator. Councilmember Barnett asked about maturity rates and investments and if there will be reinvestments showing higher amounts in 2022 and 2023. Ms. Smith responded Council adopted a resolution for all SRP costs to be paid up front so in January we will receive $9.9 million for reinvestment and be reimbursed which will then be reinvested farther out. Councilmember Skogquist asked if the $7.8 million in land held for resale includes City Hall and other properties. Ms. Smith said the majority of that figure is for the Green Haven Parkway project. 12.2 City of Anoka Received the Distinguished Budget Presentation Award. Ms. Smith said the Government Finance Officers Association, (GFOA) established the Distinguished Budget Presentation Awards Program (Budget Awards Program) in 1984 to encourage and assist state and local governments to prepare budget documents of the very highest quality that reflect both the guidelines established by the National Advisory Council on State and Local Budgeting and the GFOA's best practices on budgeting and then to recognize individual governments that succeed in achieving that goal. Documents submitted to the Budget Awards Program are reviewed by selected members of the GFOA professional staff and by outside reviewers with experience in public- sector budgeting. Ms. Smith said she was pleased to announce that the City of Anoka received this award once again for 2019. Mayor Pro Tem Freeburg said the City has been blessed with strong financial officers and thanked them for their work. November 18, 2019 (Regular) Page 17 of 17 12.3 Tentative Agenda(s). The Council reviewed the tentative agendas of the upcoming Council meetings. Councilmember Skogquist made a motion to approve the tentative agendas of the upcoming Council meetings. Councilmember Barnett seconded the motion. Vote taken. All ayes. Motion carried. 12.4 Staff and Council Input. Mayor Pro Tem Freeburg pleasure working with the two new Councilmembers the past year. 13. ADJOURNMENT Councilmember Wesp made a motion to adjourn the Regular Council meeting. Councilmember Skogquist seconded the motion. Vote taken. All ayes. Motion carried. Time of adjournment: 9:19 p.m. Submitted by: Cathy Sorensen, TimeSaver Off Site Secretarial, Inc. Approval Attestation: Amy T. Oehlers, City Clerk