Loading...
2023.11.27 Special City Council MinutesSPECIAL OTSEGO CITY COUNCIL MEETING MONDAY, NOVEMBER 27, 2023 5:30 PM OTSEGO PRAIRIE CENTER Call to Order: Mayor Stockamp called the meeting to order at 5*33 PM. R�II Call: Mayor Jessica Stockamp and Councilmembers: Jeff Dahl, Tina Goede, Brittany Moores, and Ryan Dunlap. City Staff: City Administrator/Finance Director Adam Flaherty, Assistant City Administrator/Human Resources Sabrina Hille, Utility Operation Manager Kurt Neidermeier, City Engineer Ron Wagner, and City Clerk Audra Etzel. 1. 2024 Budget, Tax Levy and Capital Improvement Plan Review. City Administrator/Finance Director Flaherty outlined the Budget Meeting #7 items that were included in the packet. Utility Operations Overview Utility Operation Manager Neidermeier reviewed the 2024 Utility Budget Narrative and presented a power point as included in the packet materials. Mayor Stockamp asked what happens if the water distribution limits are exceeded? Neidermeier stated the DNR could impose fines or penalties. CM Moores asked for further information regarding the limits. Neidermeier said the City is limited to quantities allowed from the Mt. Simon aquifers. Mayor Stockamp asked about the requests for future staff additions. Neidermeier said the current facilities are tight with space, the addition of the West WWTF will allow for growth. Neidermeier said more details regarding staffing will be presented in 2024. Mayor Stockamp asked about staff conducting the meter replacements. Neidermeier estimates about 100 meters will need to be replaced in 2024, noting some years 400-500 meters have been replaced. Neidermeier said it will take about 100 hours to replace the meters, not including the time to coordinate the appointments. CM Moores asked if the proposed administrative assistant would assist with coordinating the meter replacement. Neidermeier said the job description has not yet been created, but scheduling the meter replacement would be a good fIto CM Goede asked how long the meters last? Neidermeier said the meters last about 15 years. CM Dunlap asked if staff get pushback to replace meters? Neidermeier noted some residents don't respond in a timely fashion, but generally there are few issues. CM Dahl asked if there are issues with the ball valve leaking after replacement? Neidermeier said on occasion there are issues and staff would address with the resident; this rarely happens. CM Dahl asked if there have been issues in the past with the contractor installing the meters? Neidermeier said no, and they have received good data during the replacement process in the past such as water softener replacement. Page 1 of 4 MINUTES OF THE CITY OF OTSEGO SPECIAL CITY COUNCIL MEETING NOVEMBER 27, 2023 CM Dunlap asked when the West WWTF would be completed? Neidermeier said the spring of 2025. CM Goede asked about the completion delay. Neidermeier said the delay is mainly due to electrical. CM Dunlap asked if the new West WWTF would be able to process the biosolids? Neidermeier said no, the biosolids will need still need to be transported to the East WWTF for processing. The City Council concurred as presented. Water Utility Fund Flaherty reviewed the packet materials. The utility rate study proposes a 7% increase to the rates. Mayor Stocl<amp asked about the chemical cost increases. Neidermeier said this is due to the water usage increases. Mayor Stocl<amp asked how many meters are planned to be replaced for the next couple years? Neidermeier said about 100 over the next couple years. CM Dahl asked about past drought conditions and limiting water consumption. Neidermeier said there is currently a three-tier water structure based on usage and a separate rate for irrigation meters; noting enforcement of irrigation regulations is a challenge. Flaherty reviewed the Water Access Charge (WAC) revenues, noting this is a conservative budget amount. CM Dunlap asked if the amount will increase? Flaherty said he anticipates an increase in the WAC fees pending completion of the rate study. Flaherty reviewed the CIP projected projects for 2024 and the cash flow projection. The City Council concurred as presented. CM Dunlap at 6:26 PM motioned to continue this special meeting following the 7 PM City Council meeting, seconded by CM Dahl. All in favor. Motion carried 5-0. Mayor Stockamp reopened this special meeting at 8:23 PM. City Engineer Wagner did not return to the meeting and Assistant City Administrator/Human Resource Director Hille joined the meeting. Sanitary Sewer Utility Fund City Administrator/Finance Director Flaherty reviewed the packet materials. The utility rate study proposes a 4.5% increase to the rates. Fund also includes the addition of Utility Operator to staff and then the change in chemicals for a full year. Neidermeier said the West WWTF chemicals include an increase of about $30,000 and staff is seeing increases to all the chemicals. Flaherty noted the mill and overlay projects allow for chimney replacements. Page 2 of 4 MINUTES OF THE CITY OF OTSEGO SPECIAL CITY COUNCIL MEETING NOVEMBER 27, 2023 Neidermeier reviewed the additional expenses required. Mayor Stockamp asked about the additional costs that are coordinated with the street repairs. Neidermeier said the chimneys last about 20 years, and they can be damaged with repairs, snow plowing and infiltration. Staff is working on a new process with street projects to identify needs. Neidermeier explained the increase to expenses due to structural integrity to manholes due to gases and force main expenses for plugged pipes that City staff does not have the appropriate tools to complete. Flaherty reviewed the Sewer Access Charge (WAC) revenues. The City Council will review the SAC fees at a future meeting with a recommendation from the AE2S rate study. Flaherty reviewed the CIP projected projects for 2024 and the cash flow projection. The City Council concurred as presented. Storm Water Utility Fund Flaherty reviewed the packet materials. Flaherty noted that storm water rates have not increased since 2018. The City Council discussed the proposed rate increase and directed staff to reduce the increase to 2%. Flaherty recommends combining the two Storm Water funds going forward which will allow for better tracking of expenditures and more straight forward budgeting. The City Council concurred with this recommendation. Flaherty reviewed the cash flow projections and recommended the City Council remove the property tax levy based on current cash balances and the lack of capital projects. The City Council concurred with this recommendation. The City Council concurred as presented. Utility Rates Flaherty said the City is currently in the process of a study to review user rates and development fees for Water and Sanitary Sewer funds. The study will be presented to the Public Works Subcommittee and a formal City Council review and discussion would likely be in January of 2024. General Fund Flaherty reviewed the changes to the General fund budget for a total decrease of $139,306. Property Tax Levy Flaherty stated the City Council approved a preliminary property tax levy of $11,148,427 in September, as of the meeting the projected amount decreased by $113,003 to $11,035,424. Flaherty discussed the levy amount for the City Campus Project noting the Council has flexibility Page 3 of 4 MINUTES OF THE CITY OF OTSEGO SPECIAL CITY COUNCIL MEETING NOVEMBER 27, 2023 for this amount and can structure the debt repayment accordingly, but that additional interest costs will develop with alternative structures. Mayor Stocl<amp asked about cost projections for the projects. Flaherty said the costs are being updated based on the design development documents, with current estimates based on schematic design documents. The updated estimates will be available to the Council at the December 11 meeting. Flaherty noted that these are estimates and that actual costs will not be Known until bids are opened, and the Council still has discretion on whether to award bids. CM Dunlap does not see an option to reduce the levy to 3%that would include the City Campus Project, Mayor Stockamp said the City Campus Project started with needs for Public Works and noted there are many other limitations with staff, growth within Parks and Recreation, elections, space for training, etc. and staff had made the space work. CM Moores said this project has been designed with the current limitations and anticipated growth within the community. Mayor Stocl<amp asked the City Council to come together and provide direction to staff for the 2024 budget. After discussion the City Council directed staff to prepare 34 options. CM Dunlap asked if a Northland Representative will be present at the meeting. Flaherty confirmed. Next Meetings City Administrator/Finance Director Flaherty noted the CIP for the City Hall Campus Public Hearing to set the maximum amount to bond is scheduled for December 11, 2023, at 5:30pm. The Truth -in -Taxation meeting is scheduled for December 11, 2023, at 7:00pm. 2. Adjourn. CM Goede motioned to close the meeting at 10:02 PM, seconded by CM Moores. All in favor. Motion carried 5-0. City of Otsego: Jes ca Stockamp, Mayor ATTEST: Audra Etzel, City Clerk