Anoka City Council

January 22, 2024 (Worksession) Page 1 of 10 WORKSESSION OF THE ANOKA CITY COUNCIL ANOKA CITY HALL CITY COUNCIL WORKSESSION ROOM JANUARY 22, 2024 1. CALL TO ORDER Mayor Rice called the worksession meeting to order at 5:03 p.m. 2. ROLL CALL Present at roll call: Mayor Rice, Councilmembers Scott (participating remotely from 6168 South Ferry Place, Gold Canyon, Arizona), Skogquist, Weaver, and Wesp. Staff present: City Manager Greg Lee, Assistant City Engineer Ben Nelson, Green Haven General Manager Larry Norland; Green Haven Assistant Manager Mike Brual; Finance Director Brenda Springer; Assistant Finance Director Liz Douglas; Public Works Director Mark Anderson; Utility Director Del Vancura, Community Development Director Doug Borglund; City Attorney Scott Baumgartner. Absent: None. 3. COUNCIL BUSINESS and/or DISCUSSION ITEMS 3.1 Update; Organized Residential Solid Waste Collection – Summary of Meetings with License Haulers. City Manager Greg Lee shared a staff report stating pursuant to Minnesota Statutes §15A.94, Subd 4d, (negotiation period) and per Council direction, staff met with the licensed residential collectors on two separate occasions and provided the collectors with a draft agreement for Garbage, Refuse, and Yard Waste Collection Services. During our discussion, the collectors all expressed concern about negotiating an agreement when this will be a ballot question at the November 2024 General Election. They also expressed concern about having to share pricing and market share information during the negotiations, since depending on how the ballot question outcome there could possibly not be organized solid waste collection and they would have already shared their business trade information with market competitors. Staff inquired if the collectors would be willing to agree to the language portion only, without pricing, so that staff would be able to answer questions from voters about the types of services that they will be offered (snowbird rates, gallon size, pick ups, etc.). The collectors expressed that they would like to meet amongst themselves to discuss if everyone would be willing to do that. Staff met with the collectors again to present a draft agreement when the City was informed that one of the collectors had hired legal counsel to represent their company in case, they choose to take legal action against the City regarding this process. They expressed concern about January 22, 2024 (Worksession) Page 2 of 10 sharing pricing and market share information with competitors during the negotiation period and felt while the draft agreement was a good start they wanted to further review in a meeting and suggested postponing the process until after the November general election. They stated that if the Council would not agree to postponing, they would agree to negotiating an agreement, as long as pricing and market information is not included. Mr. Lee said staff is seeking direction on postponing until after the November General Election and whether to continue the negotiation period and work with the collectors on finalizing a draft agreement, which would include services offered, but not include pricing or market share information. If the Council does not want staff to negotiate an agreement without pricing and market share information, staff requests further direction from the Council on how to proceed. He shared next steps outlined in Statute process in detail and that organized collection could begin no sooner than six months after the City's decision to implement organized collection. Councilmember Weaver said he was not supportive of organized hauling but the attrition currently in place as he felt it worked well and did not want to have the process occurring when there will be a ballot question in November. City Attorney Scott Baumgartner shared a letter received questioning the process in conjunction with the pending ballot question and jeopardizing proprietary information from the haulers. He said staff will contact the hauler to clarify status of the propriety information. Councilmember Wesp said he was not in favor of organized hauling either and the letter was asking the judge to make a ruling regarding the City of Mounds View on April 9 as well and that he wouldn’t be in favor of moving forward until that ruling occurs. He noted we should move forward with contract negotiations until the election occurs. Mayor Rice cautioned that both cities may not be using the same process. Councilmember Skogquist said there is likely not case law around this statute and was in favor of organized hauling, adding there is a process in statute and charter already established. He said it was important to see what type of information could be shared with the hauler first in order to make better informed decisions. Councilmember Scott agreed the need to get clarification from the City Attorney. Councilmembers Weaver and Wesp supported waiting for that clarification until the outcome of the November ballot question. Council consensus was to direct staff to work with the haulers’ legal counsel to draft proprietary language for Council review. January 22, 2024 (Worksession) Page 3 of 10 3.2 Discussion; Green Haven/Consultant’s Report. Mr. Lee shared more about the report that included golf course operation and the potential of adding surrounding development. He said the study contains a lot of data and that staff will be asking Council about priorities and next steps. Green Haven General Manager Larry Norland shared a staff report stating in 2023 the City of Anoka hired John Wait of Sirius Golf Advisors to conduct an operational study of Green Haven Golf Course & Event Center and a feasibility study of an expansion of the golf course with a driving range and golf focused housing. He said this discussion includes the implementation of the operational recommendations and what has been done and can be done to improve the functionality and efficiency of the golf operation and F&B operation and discuss the feasibility of the overall project and how best to proceed with the future of the facility. He said financial impact was undetermined but depending on direction given could be anywhere from $0 to $12 million. He said staff was seeking Council direction on whether to approve the proposed operational changes and policies then highlighted parts of the consultant’s report that said Green Haven was one of the best operated courses he has worked with, especially considering it was a municipal operation, and that all three main managers were excellent at their jobs. He reviewed potential issues regarding part-time wages, an over emphasis on depreciation, proposed employee benefits that included play, golf course layout, forward tees, restrooms, hours of operation and staffing, cart operation, and point of sale among others, and asked for Council direction. Councilmember Skogquist spoke about working to maximize profits, the need to focus on underserved users and use the existing space better then asked if no additional capital is designated what could occur. Mr. Norland said he conducted similar studies in his previous profession and spoke about the need for better communication in any event. He referred to payroll and employee issues in some instances and ways to address that including flexibility in pay where appropriate and creation of a policy to allow employees to play golf as a benefit. He said this allowance will help the facility by making employees more loyal and allow them to see the facility from a different perspective, resulting in attracting a higher quality staff. He spoke about depreciation and the need to invest back into the facility and noted golf courses are great investments because you can use depreciation to offset income taxes. Finance Director Brenda Springer noted the purchase of new golf carts wouldn’t go against profit or loss as they would be considered assets. Councilmember Weaver noted staff had requested inclusion of a capital improvement plan item of $400,000 from the general fund for golf carts. Mr. Norland said staff had proposed the amount to be paid for out of the cash flow from the golf course to help increase revenue, but the Council didn’t agree. January 22, 2024 (Worksession) Page 4 of 10 Councilmember Skogquist supported segregating golf and having the course pay for as much as possible, adding we use the facility for City purposes, then commented on the importance of knowing the golf enterprise covers costs, similar to the electric utility. Councilmember Weaver asked about the current rate structure outlined in the Bunker Hills study. Mr. Lee explained Anoka was at the bottom of the rate list. Mr. Norland noted Green Haven had only a couple real competitors in Bunker Hills and The Refuge because other courses like Rush Creek were not comparable, adding the proposed rate increases for 2025 are even more than we suggested. He said Green Haven is a 75-year old course that hasn’t had upgrades for many years and that we cannot compete and have rates like Bunker Hills until we make some improvements. Councilmember Weaver asked if Chomonix and Fox Hollow would be comparable. Mr. Lee noted if the course was at capacity then we need to increase rates. Councilmember Wesp said he didn’t understand why staff was surprised at rates and felt they should have been brought forward to Council for review. He said we need to increase rates and reduce rounds to help the course through maintenance and if this was an enterprise for the City we need to generate enough revenue to purchase new carts. He said the high school golf team wasn’t using the course because of the lack of a driving range and if we’re going to have Green Haven be successful, we need to make more changes than just bunkers and the road. He shared comments regarding the need to make the course sustainable but how one of the biggest contentions is that only golfers love the course. He spoke about the need for connection in the community and to a destination that pays for itself where all levels of users can play and have the course be something the City is proud of. He said while initially there will be a cost it will eventually be self- sustaining, adding Bunker Hills is likely subsidized. Councilmember Weaver noted liquor and electric revenue comes from other cities and that he wants golf to be the same thing by bringing people from outside the City to help generate funds for this project, adding profits help bring down our general fund. Councilmember Wesp said the simulators were installed 2019 then asked if they have paid for themselves. Ms. Springer explained the simulators were still being paid off but that based on revenues made they anticipated receiving $40,000 annually. Mr. Norland agreed with the positive impact from the simulators but noted there was some loss due to COVID then commented about the study in detail, stating January 22, 2024 (Worksession) Page 5 of 10 the difficulty is in the housing and whether that should come into play as it could generate $100 million for the City if done. Councilmember Scott agreed but said we’ll need to know what our debt capacity is, especially in light of other projects such as a new liquor store. Councilmember Wesp spoke about the increase from the American Club and the need for staff to review the proposed $45 million investment in housing around the golf course and analyze the return for viability that would make the course a sustainable enterprise for the City, similar to the liquor store, if done on sound business principles. Mr. Brual agreed then explained program offerings being made for American Club residents and the resulting benefits. Mr. Norland shared his past experience with 80,000 rounds at a facility in Red Wing that he operated that attracted people from out of town which greatly helped support the course. He said the resulting revenue from people outside the city was great and the need for a driving range at Green Haven was important, then shared photos of a proposed facility that included heated enclosed stalls that could feature music, food and beverages. Councilmember Weaver said staff needs to include review of the Agriculture Center and the Buldoc property that will come into play at the same time. Mr. Lee agreed the next step was to purchase the Buldoc property which would allow the City to remove Garfield Street from the golf course resulting in no more cut through traffic and the need for street reconstruction. He said the City purchased the former fence company property and this would be the next step, even though we will have to bond for it. Councilmember Weaver fully supported the direction of purchasing the Buldoc property. Councilmember Skogquist agreed said it was important to understand the figures first, stating Anoka was not Coon Rapids and this was a much bigger risk than Bunker Hills and if we do this what other things won’t we be able to do. He said we need to know what our priorities are as Anoka has drained all extra money to get where we are today and we don’t have enough money to construct a new liquor store or buy property and we can’t depend on the electric fund to continue to cover projects, which are taxpayer funds. He said streets and parks need investment too and that all priorities needs to be included on their goal setting agenda. Mayor Rice said it was important to note we haven’t squandered funds but made calculated value choices and that the golf course should be considered another choice, especially as we work to reduce spending and increase revenue. January 22, 2024 (Worksession) Page 6 of 10 Ed Evans, Anoka, stated former Councilmember Mark Freeburg made this golf course what it is today and thanked him for his work. Councilmember Weaver said he supported moving forward now because City Councils change and we need to keep these amenities in place and solidify Green Haven’s place in the City as a certainty. A representative from American Club Cooperative (individual did not sign in), said they moved here because of the location and the golf course and besides golf they eat at The Tavern. He said there were people in the American Club that were from all over the country and said Green Haven could be what Red Wing saw in their golf course and the resulting revenue throughout their city. A resident of the American Club shared comments about missing the mark for people if not done, adding a driving range was needed for others to try even if they don’t golf. He said there is a lot going for us here and it needs to continue, adding removal of the road. Councilmember Wesp noted only about 25% of rounds are generated by Anoka residents which showed the investment from people outside the City. Mayor Rice said Green Haven is a draw for a specific reason and that customers will change as the course changes. Joe Chesley, Anoka, said he supported changes to have the course continue to prosper as it was extremely important for the community. Councilmember Wesp suggested staff analyze the proposed costs and return based on the consultant’s presentation for validity and feasibility. Mr. Lee said staff will conduct that analysis and present to Council to determine priorities at the goal setting session, noting development outlined in Concept 1B could be occurring even today. Ms. Springer noted any development should start in the City’s TIF district. Steve Fellows, Blaine, asked if the new course doesn’t happen what was the alternative plan, adding the last improvements occurred in the mid-1990s and that improvements are needed now. Mr. Norland outlined some potential alternative plans but said because the course hasn’t kept up with improvements in the facility they will not be as successful as they could. Discussion was held on the auxiliary benefits of course improvements resulting in the restaurant and other components. January 22, 2024 (Worksession) Page 7 of 10 Councilmember Skogquist said this was a good plan but shared concerns with the costs and that we needed to review our goals and circle back for clearer direction. Ms. Springer said staff will work with Ehlers and Associates to create financing options to capitalize on the interest in payments as part of the bond issue to occur once the improved course was up and running. Mr. Norland shared it was easy to get excited about the course’s potential but understood the difficulties as well as the benefits of potential housing opportunities. He appreciated the Council’s consideration as he believed this could be a great opportunity for Anoka. 3.3 Discussion; Time Use of Electric Vehicles (EV) Charging Rates. Assistant Finance Director Liz Douglas shared a staff report with background information stating staff was proposing a process for customers with electric vehicles to have the option to charge those vehicles during off peak hours at a discount. This process will include electric permit, additional meter, and a grid charge. Once the customer has completed the steps and a meter is installed, the customer will receive a discount for the kwh used for that EV charge during off peak time which is currently 10pm to 7am. The customer would pay a premium for any use during peak time. This rate structure is only available to residential customers using a Level II charger. Customers who do not have Level II, or who find they would need to charge during peak hours, would not financially benefit from this process and staff would recommend that they charge at regular rates. As with all rates, this would be part of the rate study that AMU will conduct as part of AMI implementation. Dependent on EV adoption, and among adopters how many would choose to install new subpanel and meter. Projected impact is minimal. She said Council was asked to provide guidance on whether or not a resolution is required for implementation. Electric Utility Director Del Vancura explained further how the concept would work and timing for vehicle charging and reducing the need for additional infrastructure, stating this was an industry standard being proposed. Councilmember Wesp asked questions about the volume of requests received. Ms. Douglas estimated staff has received 10-15 requests. Councilmember Weaver asked how many EV stations were used in the parking ramp and if this would be a good trial run to gauge interest. Ms. Douglas stated revenue did not tell them how many used the stations or for how long so it was difficult to estimate but estimated 3-4 uses occur and this would be a good trial run as there was not a large cost investment as the customer was bearing the most costs which could be offered as a rebate as part of the conservation program. January 22, 2024 (Worksession) Page 8 of 10 Councilmember Skogquist said we need to spend a certain amount of funds as part of the conservation program and felt this would be a good use for those funds. Mr. Vancura estimated it would take 3-5 years to pay off the investment. Ms. Douglas noted infrastructure would be placed in homes at the homeowners’ expense. Mr. Lee suggested programming meters once the ability is available instead. Ms. Douglas explained the ability would not change whether the meter was an AMR or AMI type as EV would need a separate meter anyway. Councilmember Skogquist asked how the proposed rates calculated. Ms. Douglas explained they were determined based on comparisons with other providers. Councilmember Skogquist supported this being a trial program before investing a lot into infrastructure as it would be a minimal cost and could utilize the conservation program dollars. He said he would want similar offerings made for other utility charges such as off-peak rates, etc. Dr. Evans said it would be good to EV rates in place before the demand increases so residents know what the rate structure. Mr. Vancura said it was important to have the option to provide an option to charge overnight at an off-peak rate. Ms. Douglas noted as a new rate and not a rate change that there may not be a need for a formal Council resolution but just direction. Council agreed. Community Development Director Doug Borglund noted the building code recently changed to include EV stations in new multi-family developments based on a ratio of the number of units so this will be good to have in place. 3.4 Discussion; MMPA Purchased Power and Qualified Tariff Rates. Mr. Vancura shared a staff report with background information stating AMU has grouped with 11 other Minnesota municipalities to form MMPA. MMPA has been empowered to purchase generated power with purchase power agreements with each member city and Avant Energy is the managing partner at MMPA. He said Avant Energy is requesting each member city approve tariff rates for distributed generation for 2024 then shared current rate information including kilowatt hour and adjusted rates. Mr. Vancura explained demand and transmission line service, metering processes and reimbursement to customers, and said the requested action before Council at the next regular meeting will be to consider the proposed tariff rates. January 22, 2024 (Worksession) Page 9 of 10 Dr. Evans asked about those who own solar panels now and the need for lines to provide power in the event their solar panels do not operate. Mr. Vancura explained that’s part of the already-approved fee schedule as the City still has to provide the infrastructure even if solar is in place. Councilmember Weaver asked if the panels have battery storage for their own use. Mr. Vancura explained storage capabilities and how if not used the power goes into the system but usually is used to support the homeowner’s system. Councilmember Skogquist suggested a fixed rate for infrastructure then create a demand rate as solar/alternative energy options change. Dr. Evans suggested explaining to customers potential brownout predictions. Further discussion was held on this potential and the need to understand it more and who would be affected. Mr. Vancura explained the potential impacts and failures and how they would be addressed in the event they occur. UPDATES/REPORTS/COUNCIL SUGGESTIONS FOR TENTATIVE FUTURE AGENDA ITEMS Mr. Lee shared a joint meeting with the Anoka County Board of Commissioners has been scheduled for February 7 the asked about the agenda structure Council is looking to have and whether staff should be present. He said he believed the meeting was more of a higher level of elected officials and suggested that Mayor Rice and Chair Gamache moderate the meeting. Mayor Rice believed the meeting should be policy-related but supported staff being available as resources. Councilmember Wesp asked about the goal of the meeting and how to move forward. Councilmember Skogquist said it was important for us to be clear on the process and timeline and share our desire for an outcome, adding it was important for the Board as well. Councilmember Weaver said staff should have maps available on the proposed jail locations which was considered for potential solar panels and conceptual drawings of the existing State hospital grounds as we need to know if we are ready to allow demolition of those buildings because if not the result will be expansion in the downtown area. He said we need to think about access by 4th Avenue near the residential development, alternatives, and possible signalization. Councilmember Wesp said it appeared the Board did not know what they wanted to do as well as we should be prepared to share what we want, adding we already shared our desires then confirmed the City’s legislators will be present. January 22, 2024 (Worksession) Page 10 of 10 Mr. Lee confirmed the legislators will be present but suggested having them just listen at this point. Dr. Evans shared the jail expansion had never been mentioned to the jail advisory board and that the biggest concern was inmate transport. He noted how the jail addressed transport the pandemic remotely but that they didn’t want to utilize that technology any longer then commented about taxpayer costs if the jail expansion was constructed and alternatives that included renting other locations for 100 years at a lower cost. Mr. Lee shared an estimate of the jail expansion would be $1,000 for every person in Anoka County. 4. ADJOURNMENT Motion by Councilmember Weaver, seconded by Councilmember Wesp to adjourn the Worksession at 7:18 p.m. Motion carried. Submitted by: Cathy Sorensen, TimeSaver Off Site Secretarial, Inc. Approval Attestation: Amy T. Oehlers, City Clerk