City Council Meeting

CITY COUNCIL MEETING MINUTES Tuesday, January 06, 2026 at 7:00 PM Baxter City Hall, 13190 Memorywood Drive, Baxter, MN “A Growing Community” CALL TO ORDER Mayor Olson called the meeting to order at 7:00 p.m. ROLL CALL Mayor Darrel Olson and Council Members Connie Lyscio, Zach Tabatt, Patrick Sundberg, and Mark Cross were present. City Administrator Brad Chapulis, Assistant City Administrator Kelly Steele, Finance Director Jeremy Vacinek, Police Chief Matt Maier, Community Development Director Josh Doty, and Public Works Director Trevor Walter were present. PLEDGE OF ALLEGIANCE All joined Mayor Olson in reciting the Pledge of Allegiance. PRESENTATIONS None. ADDITIONS OR CHANGES TO THE AGENDA None. PUBLIC COMMENTS - Comments received from the public may be placed on a future meeting agenda for consideration. None. CONSENT AGENDA - The following items are considered non-controversial by staff and are recommended to be read and passed in one motion. Any council person, staff, citizen, or meeting attendee can request one or more items be pulled from the Consent Agenda and the item will be pulled and addressed immediately after the passage of the Consent Agenda; otherwise, the following items will be passed in one motion: 1. Approve City Council Work Session Minutes from December 16, 2025 2. Approve City Council Minutes from December 16, 2025 3. Approve the Payment of Bills and Finance Report (Addendums A and A-1) 4. Adopt Resolution 2026-001, Establishing the 2026 Council Appointments 5. Adopt Resolution 2026-002, Establishing the 2026 Annual Designations 6. Authorize Execution of Annual Advertising Contract with the Brainerd Dispatch 1/6/2026 City Council Meeting Minutes Page 2 7. Approve Amendments to the Building Official Job Description 8. Approve Appointment to the Seasonal Position of Warming House Attendant 9. Approve the SEH Contract in the Not to Exceed Amount of $57,292.00 for the 2026 Baxter WTP HVAC Improvements 10. Approve the Issuance of a Lower-Potency Hemp Edible Registration to Jack Pine Brewery for the Period of January 7, 2026 through December 31, 2026 11. Adopt Resolution 2026-003 Submitting Application for Phase 2 of the Southeast Baxter Surface Water Overflow Project. MOTION Council Member Tabatt, seconded by Council Member Cross to approve the consent agenda, excluding item 10. Motion carried unanimously. PULLED AGENDA ITEMS Council Member Sundberg asked to pull item 10 as he is the applicant. MOTION by Council Member Cross, seconded by Council Member Tabatt to approve the Issuance of a Lower- Potency Hemp Edible Registration to Jack Pine Brewery for the Period of January 7, 2026 through December 31, 2026. Motion carried with Council Members Lyscio, Tabatt, and Cross and Mayor Olson voting yes. Council Member Sundberg abstained. OTHER BUSINESS 12. Acceptance of KLJ Executive Summary of Independent Review of Final Layout of Hwy 371 Overpass Project City Administrator Chapulis explained in November the council contracted with KLJ Engineering to complete an independent review of the final layout of the highway 371 improvement project. The review has been completed and Joe DeVore, with KLJ, will present his findings. Staff is recommending the council accept KLJ’s executive summary. Joe DeVore explained that the junction of highway 371 and highway 210 in Baxter is one of the busiest and most congested intersections in northern Minnesota. Over the years, it has been in the top 5 highest crash intersection in the state, prompting an urgent need for improvements. The independent review of the proposed interchange project confirms that converting this signalized intersection into a new buttonhook interchange will make travel safer, smoother, and easier for both through-traffic and local drivers. Based on technical review, the buttonhook interchange is expected to:  Significantly improve regional traffic flow  Reduce crashes by over 60%  Provide access to Excelsior Drive  Provide direct access to both Edgewood/Dellwood frontage roads. With this review, several near-term considerations were identified inside and outside the project area that should be addressed for near-term operations, safety, and access of TH 371 to be balanced while this interregional corridor continues to transition from signals to grade separated control. 1/6/2026 City Council Meeting Minutes Page 3 Mr. DeVore recommended four near-term considerations inside the project area. Those recommendations were related to the TH 210 east ramp intersection/west bound RAB reconfiguration, posted speed target of 55 MPH, sign restrictions should be modified based on the adjacent elevation of the roadway to allow for better visibility, and wayfinding signs to limit backtracking should be considered. Mr. DeVore recommended two near-term considerations outside the project area. Those recommendations are improvements at Clearwater Road and Woida Road and dual eastbound left and signal revisions need to be implemented at Glory Road. The key findings of the study identified there is an overwhelming lean in traffic going north on TH 371 or east on TH 210 making those movements critical for business access, improved regional travel time reliability, major safety benefits, local access concerns, and speed control. Mr. DeVore provided a summary of the following affected areas, Elder Drive/Foley Road diversion to Glory Road; Fairview Road; TH 210 east roundabout with westbound queuing; Golf Course Drive; Excelsior Road bridge and visibility; Design Road; and Clearwater Road. Mr. DeVore explained TH 371 traffic has not grown over the last ten years. However, alternative routes have seen increases in traffic counts. The proposed buttonhook design provides for improved travel times. The buttonhook design will reduce crashes by 60-70%. Whereas some of the other designs only reduce crashes 25-35%. Mr. DeVore met with the Brainerd Lakes Chamber of Commerce and local businesses to understand their concerns with the proposed design. This meeting helped to identify technical measures that could measure impacts due to access reconfigurations and identify if mitigation could be made safely. Mr. DeVore concluded his findings show the interchange provides needed regional benefits at the TH 371 and TH 210 intersection. City Administrator Chapulis explained the city is responsible for beatification costs, not for the cost of the roundabouts and overpass. MOTION by Council Member Tabatt, seconded by Council Member Lyscio to Accept of KLJ Executive Summary of Independent Review of Final Layout of Hwy 371 Overpass Project. Motion carried unanimously. City Administrator Chapulis explained the council has only one regularly scheduled meeting before the deadline to make a decision on the project. The council can make their decision on January 20th or schedule a special meeting. The council consensus is to have the vote on the January 20th council meeting agenda. 13. Sales Tax Extension Discussion and Consider Adoption of Resolution 2026-004, Supporting Extension of Local Sales Tax and Motor Vehicle Excise Tax Authority Finance Director Vacinek explained the council’s philosophy is that Baxter residents alone should not carry the cost for regional infrastructure and public safety costs. The local option sales tax provides the ability to capture some of the revenue from providing regional center services. 1/6/2026 City Council Meeting Minutes Page 4 The local option sales tax required both state and local approval prior to implementation. The sales tax revenue must be used for capital projects, must have a sunset, and a regional component is necessary. In 2014 the legislature changed the criteria to extend local sales tax. Entities can submit up to five projects to the tax committee chairs by the beginning of the legislative session with project descriptions and a regional benefit narrative. Residents would vote for each project individually. Finance Director Vacinek summarized the historical gross local sales tax and motor vehicle excise tax collection amounts. In 2024 the city collected 2.8% less than in 2023. For 2025 through September, sales tax collections are up .12% from the same period in 2024. Overall, from 2007 to 2024 sales tax collections and motor vehicle excise tax collections are up 78.8%. In 2014 the city received an extension to the intimal 2006 sales tax authorization. The 2014 authorization authorized collection of $40 million. As part of a revenue sharing agreement with the City of Brainerd, Baxter is required to provide $8 million in sales tax proceeds to finance the water and sewer infrastructure extension to the Brainerd Lakes Regional Airport. The city is projected to have sufficient revenues by the end of 2027, before the current authorization expires on December 31, 2037. Projections for a 20-year extension, through December 31, 2046, support $77 million of capital projects, plus debt service interest and issuance costs of associated bonds. Staff is proposing to use an extension of the sales tax and motor vehicle excise tax for wastewater and water utility improvements, street transportation improvements impacted by regional highways, and public safety facilities improvements. The next steps are for the council to adopt a resolution to support sales and motor vehicle excise tax extension. A request for the extension must be filed with the house and senate tax committees. The legislature must approve the extension this legislative session. Finally, the sales tax question will be on the November 3, 2026 General Election ballot. If the council agrees to staff’s proposal, staff recommends the council adopt resolution 2026-004. MOTION by Council Member Sundberg, seconded by Council Member Lyscio to adopt Resolution 2026-004, Supporting Extension of Local Sales Tax and Motor Vehicle Excise Tax Authority. Motion carried unanimously. COUNCIL COMMENTS 14. Connie Lyscio – Congratulated Council Member Cross for being honored as the distinguished community service provider of the year. 15. Zach Tabatt – Congratulated Council Member Cross. Suggested the city consider working towards increasing community pride through encouraging more people to serve the community, improving city branding, and considering civic groups assisting with events and engagement. 16. Patrick Sundberg – Explained the ice skating trail at the Northland Arboretum is the only woodland skating trail in Minnesota. The trail has recently received a lot of social media attention. 17. Mark Cross – Explained the Northland Arboretum trail is a signature event for Baxter. Council Member Cross inquired if staff has a list of road improvements and estimated project costs that will need to be completed due to the future highway 371 project and where the project funding will 1/6/2026 City Council Meeting Minutes Page 5 come from. Council Member Cross inquired if the council would see a capital improvements plan prior to the sales tax vote in November. Public Works Director Walter explained the city can look at highway safety grants, state aid funding and other funding sources. Hopefully the sale tax will be a funding component. 18. Darrel Olson – Explained the council has an important vote coming up on the highway 371 project and thanked council and staff for diligent work everyone has done. CITY ADMINISTRATOR'S REPORT City Administrator Chapulis explained staff will be mailing a friendly notice to property owners in the north Forestview improvement project that the five year window to connect to city services will be coming up. There are 22 properties that have not yet connected to city services. MOTION by Council Member Lyscio, seconded by Council Member Tabatt to enter into a closed session at 8:48 p.m. to discuss labor negotiations. Motion carried unanimously. CITY ATTORNEY'S REPORT 19. City Council Will Meet in a Closed Session Pursuant to Minn. Stat. Section 13D.03, to Discuss Labor Negotiations MOTION by Council Member Lyscio, seconded by Council Member Tabatt to return to an open session at 9:07 p.m. Motion carried unanimously. City Administrator Chapulis explained the council directed staff to continue negotiations. ADJOURN MOTION by Council Member Cross, seconded by Council Member Sundberg to adjourn at 9:09 p.m. Motion carried unanimously. Approved by: Respectfully submitted, _____________________________ Darrel Olson Kelly Steele