HomeMy WebLinkAboutMay 3, 1993 Work SessionNOTICE OF OFFICIAL MEETING
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Notice is hereby given that an official meeting
is to be held in the
City of Columbia Heights
as follows:
Meeting of:
MAYOR, CITY COUNCIL, AND CITY MANAGER
Date of Meeting:
MONDAY, MAY 3, 1993
Time of Meeting:.
3:00 PM
Location of Meeting:
Purpose of Meeting:
3:00
3:45
4:30
5:00
CITY HALL CONFERENCE ROOM
590 40TH AVENUE NE
WORK SESSION
1. Discuss Compensation and Responsibility Adjustments
a) Liquor Operations Wage/Responsibilities
b) Clerk/Typist Administration Adjustment
c) MN Department of Employee Relations Compliance
Discuss Housing and Redevelopment Authority
Consolidation
a) Staffing/Organization Plan
b) Pay Equity Implications
c) Combine Department Budget Summary
d) Economic Development Authority Ordinance
3. Zero Lot Line Ordinance
Staff
5:30 5.
6:00
General Obligation Tax Increment Refunding Bonds
a) Discuss Refunding Issues
b) Status of Cash Reserves and Investments
c) Special Assessment Bond Call Date
Capital Improvement Needs Report
a) Need for Adopted Capital Improvement Plan
b) Capital Improvement Planning Process
c) Use of Capital Improvement Plan Info. in Establishing
Water/Sewer Rates, Cash Level of Infrastructure Funds,
etc.
6. Murzyn Hall Management Plan
a) Establishing a BYOB Policy
7. Adjournment
The City of Columbia Heights does not discriminate on the basis of disability in the
admission or access to, or treatment or employment in, its services, programs, or
activities. Upon request, accommodation will be provided to allow individuals with
disabilities to participate in all City of Columbia Heights' services, programs, and
activities. Auxiliary aids for handicapped persons are available upon request when the
request is made at least 96 hours in advance. Please call the City Council Secretary at
782-2800, Extension 209, to make arrangements. (TDD/782-2806 for deaf only)
CITY OF COLUMBIA HEIGHTS
TO:
FROM:
DATE:
SUBJECT:
MAYOR AND CITY COUNCIL
PATRICK HENTGES, CITY MANAGER
APRIL 30, 1993
INFORMATION ON MAY 3RD WORK SESSION
AGENDA
1)
2)
3)
4)
5)
Compensation Adjustments-
Information regarding compensation and responsibility adjustments, together with pay equity
implications will be submitted at the meeting.
HRA Staff Consolidation
Enclosed please find background information that was previously submitted to the City Council
at the time the HRA/EDA Ordinance was reviewed. Additional information including a
summary budget and organizational/staffing chart will be submitted at the meeting.
Zero Lot Line Ordinance
Enclosed please find a proposed zero lot line ordinance. Further information regarding the
implications of this ordinance on the existing duplex stock or inventory will be submitted at the
meeting.
General Obligation Tax Increment Refunding Bonds
Enclosed please find the previous information submitted to the City Council on the refunding
of the general obligation tax increment bonds of 1987. Dan Hartman of Springsted and Cleo
Rasmussen of Miller Schroeder will be in attendance at the meeting. City staff will additionally
prepare and submit at the meeting information on our cash reserves and investments, and further
information on call dates of existing special assessment bonds.
Capital Improvement Needs Report
Enclosed please find a report from City Staff regarding a projection on our Capital Improvement
needs. City Staff will provide further information at the meeting regarding the development of
an ongoing Capital Improvement Planning Process.
6) Murzyn Hall Management Plan
Information regarding a BYOB Policy will be submitted at the meeting.
If you have any additional questions or wish the staff to develop additional information for the work
session please contact me at your earliest convenience. Thank you.
PH/sh
Item 1:
Item 2:
AGENDA -- Meeting December 8, 1992 to discuss the HRA/EDA
creating an
Background and the purpose in
Economic Development Authority.
ae
Purpose
1. Increased Accountability
2. Increased Efficiency and Decreased Costs
B. Establishment
C. Transfer of Authority
1. Projects
2. Personnel
D. Powers of Authority
E. Limitations on Power
F. Bonds
1. General Obligation
2. Revenue Bonds
G. Tax Levies
H. Sale of Property
I. Advantages of EDA
Proposed Resolutions
MEETING DECEMBER 8w 1992
BACKGROUND INFORMATION REG~DING CREATION OF EDA
PURPOSE
The city of Columbia Heights was interested in finding a way
to increase the accountability of the Housing and Redevelopment
Authority. The Council was specifically interested in creating
elected official accountability. They were concerned that the
current organizational structure consisting of an appointed board
of commissioners lacked accountabilitY to the general public. The
city council requested that the city attorney's office investigate'
a method by which the city council Could be made the commissioners
of the Housing Authority and still continue the current Authority's
functions. Such a move would thereby create accountability from
the HRA, for its actions, to the general public. In addition, the
city council may streamline the operation of the EDA by combining
the functions of the authority ~with other city department
operations wherever possible.
CREATION OF AN ECONOMIC DEVELOPMENT AUTHORITY
Under Minn. Stat. § 469.090 to 469.108 a city may consolidate
the functions of a housing and redevelopment authority and an
economic development authority. The city, may, by resolution
transfer the control, authority, and operation of any project as
defined in section 469.001 to 469.047 located within the city, from
the agency that established the proj~ect to the economic development
authority. The economic development authority may exercise all of
the powers that the governmental Unit establishing the project
could exercise with respect to the project. Minn. Stat.
469.04(2) .
By establishing an economic development authority, the city
council may dissolve the current housing and redevelopment
authority, but yet, retain the ability to perform the functions and
projects previously administered by the HRA.
Establishment
A city may by adopting an enabling resolution, create a
economic development authority which has the powers contained in
Minn. Statute § 469.090 to 469.108 and the powers of a housing and
redevelopment authority under Minn. Statute § 469.001 to 469.047.
The creation of an authority by a city must be by written
resolution. Before adopting the resolution, the city must hold a
public hearing with the required statutory notice given. Minn.
Stat. § 469.093(1).
Transfer of Authority
The city may, by resolution transfer, the control, authority
and operation of any project defined in section 469.174(8) or any
other project authorized by sections 469.001 to 469.047 (housing
and redevelopment authority), or 469.124 to 469.134 (city
development districts), that are within the city, from the agency
that established it to the economic development authority.
Subsequent the transfer, the economic development authority may
exercise all of the powers that the agency establishing the project
could have exercised. Minn. Stat. § 469.094(2).
Once a project has been transferred to the economic
development authority, the authority shall be held to perform the
terms, conditions, and covenants of the bond indenture or other
agreements executed for the security of any bonds issued by the
governmental subdivision that originated the project. In addition,
the economic development authority may exercise all the powers
necessary to perform the terms and:conditions of any indenture or
other agreements executed for the security of the bonds. They
shall also become obligated on the bonds when the project or
program is transferred pursuant to Minn. Statute § 469.094(2).
Transfer of Personnel and Appointment of Commissioners
The city council may, by resolution, place any employees of
the housing and redevelopment authority under the direction,
supervision, or control of the economic development authority.
Transfer of employees to the economic development authority does
not affect the rights of the emplOyee, including those that may
exist under collective bargainingl agreements or fringe benefit
plans. Minn. Stat. § 469.094(3).
The enabling resolution may provide that the members of the
city council shall serve as the commissioners of the authority.
Minn. Stat. § 469.095(2)(d). The enabling resolution may further
provide for the appointment of additional commissioners in excess
of the number of city council members. Minn. Stat. §
469.095(2) (e). Normally, commissioners would be appointed for six-
year terms, however, the council may set the term of the
commissioners who are members of thee city council to coincide with
their term of office as members of 'the city council. Minn Stat. §
469.095(2) (f).
Powers of the Authority
Pursuant to Minn. Stat. § 469.101:
1. An authority may create and define the boundaries of
economic development districts at any place ~r place's ~within the
city if the district satisfies the !requirements of § ~9.174(10)
(tax increment financing), except that the district bound~'ies must
be contiguous, and may use the powers granted in § 46 090 to
469.108 to carry out its purpose. First, however, the a ~hority
must hold a public hearing on the matter.
2. The authority may acquire by lease, purchase,' gift,
devise, or condemnation proceedings:the needed rights and interest
in properties to create economic development districts.
3. They may sign options to purchase, sell or lease property.
4. The authority has the right to acquire property through
the use of eminent domain or if it is authorized under it's city's
charter, by condemnation.
5. The economic development authority may enter into
contracts for the purpose of economic development, within the
powers given it in § 469.090 to 469.108.
6. An authority may be a partner or a limited partner in a
partnership whose purpose is consistent with that of the authority.
7. An authority may acquire the rights of an easement for the
development of an economic district.
8. The economic development authority may by the necessary
supplies it needs to carry out its purposes.
9. The economic ~evelopment authority may accept money, land,
or any other assistance in any form from, the federal or state
government or a Subdivision thereof, in order to acquire and
develop an economic development district.
10. T~le authority may sell or lease land held by it for
development~n economic develepment districts.
11. ~'~ economic development authority may apply to the board
defined iF£9 U.S.C. 8la, for the right to use the powers provided
in 19 U.~iC. 8la - 81u (foreign trade zone). An authority may
apply for the powers in conjunction with another authority.
12~ The economic development authority may exercise the
powers and duties of a redevelopment agency under § 469.152 to
469.165 (municipal industrial development), for the purposes of a
housing and redevelopment authority(§ 469.001 to 469.047) or an
economic development authority(§ 469.090 to 469.108). The
authority may also use the powers and duties enumerated in §
469.001 to 469.047 or 469.090 to 469.108 for a purpose in § 469.152
to 469.165.
13. The authority may maintain and operate public facilities
(i.e. parking ramps) to promote economic development in an economic
development district.
14. An economic development authority may cooperate with or
act as an agent for the federal or the state government, or a state
public body, or an agency or instrumentality of a government or a
public body to carry out the powers enumerated in § 469.090 to
469.108, or any other federal, state, or local law relating to
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economic development district improvement.
15. An authority may study and analyze economic development
needs in the city and ways to meet those needs within the city,
including, patterns for land use,and community and industrial
growth. Additionally, an may disseminate information on economic
development within the city.
16. An authority may, to further an authorized purpose:
(1) join an official, industrial, commercial,
or trade association, or another organization
concerned with economic development (2) have a
reception of officials, who may contribute to
advancing the city and its economic
development, and (3) carry out other public
relations activities to Promote the city and
its economic development. ~
17. The authority may accept conveyances of land from other
public agencies or other units of government, if the land may be
properly used by the authority to promote economic development in
an economic development district.
18. An authority may carry out the laws relating to and
enabling economic development to develop and improve the lands in
an economic development district to make it suitable and available
for economic development uses and purposes.
19. After authorizing bonds under the appropriate sections,
an authority may borrow to provide money immediately required for
the bond purpose. The amount borrowed, however, must not exceed
the amount of the bonds (see § 469.101(19)).
20. the proceeds of obligations issued by an authority under
§ 469.103(revenue bonds) and temporary loans as described in §
469.101(19), may be used to make or purchase loans for economic
6
development facilities that the authority believes will require
financing (see § 469.101(20).
21. Upon delegation by a municipality an authority may
exercise the delegated powers in relation to mined underground
space development (see § 469.135 to 469.141).
22. An authority may sell, at private or public sale, any
note, mortgage, lease, sublease, lease purchase, or other
instrument or obligation evidencing or securing a loan for economic
development purposes to a business, for-profit or nonprofit
organization, or an individual.
23. Not withstanding any contrary law, the authority may
participate with public or private corporations or other entities,
whose purpose is to provide seed or venture capital to small
businesses that have facilities located or to be located in the
economic development district (see 469.101(23)).
Limits on Powers
The enabling resolution approved by the city council may
impose the following limits upon the powers and actions of the
authority:
1. The authority must obtain prior approval from the city
council before exercising the specified powers contained in
sections 469.001 to 469.047, 469.090 to 469.108 and 469.124 to
469.134.
2. The city council may require the authority to transfer any
portion of the reserves generated by the authority, not previously
7
pledged, to the debt service fund of the city to be used solely to
reduce tax levies for bonded indebtedness of the city.
3. The city may require that the sale of all bonds or
obligations issued by the authoritY be approved by the city prior
to issuance.
4. The resolution may require that the authority follow the
budget process required for city departments.
5. The city may require that all official actions of the
authority are consistent with the comprehensive plan of the city.
6. The city may require that the authority submit all planned
activities for influencing the action of any other governmental
agency, subdivision, or body to the council for approval.
7. They may require that the authority submit their
administrative structure and management practices to the council
for approval. :
8. The council may include in the enabling resolution any
other limitation or control deemed necessary. Minn. Stat. §
469.092(1) .
The enabling resolution may be modified at any time provided
that the limitations imposed are not applied in such a manner as to
impair the security of any bonds! issued or contracts executed
before the modification is imposed. In addition, the council must
not modify any limit in effect at the time any bonds or obligations
are issued or contracts executed to the detriment of the holder of
the bonds or obligations, or any contracting party. Modifications
must be made in compliance with the procedural requirements set out
8
in section 469.093. Minn. Stat. 469.092(2), (3), and (5).
Bonds
General Obliqation Bonds ~ 469.102
An economic development authority may issue general obligation
bonds in the principal amount authorized by a two-thirds majority
vote of the city council. The bonds may be issued in anticipation
of income from any source. They may be issued: (1) to secure
funds needed to pay for acquired property, (2) for any other
purpose authorized by sections 469.090 to 469.108. Minn Stat. §
469.102(1). The bonds must be secured by the pledge of the full
faith, credit, and resources of the issuing authority's city. The
authority may pledge the full faith, credit, and resources of the
city only if the city specifically authorizes them to do so.
An authority that issues a bond under § 469.102, shall, before
issuing them levy a tax for each year on the taxable property in
the authority's city. The tax must be for at least five percent
more than the amount required to pay the principal and interest on
the bonds as the principal and interest mature, the tax must be
levied annually until the principal and interest are paid in full.
Minn Stat. § 469.102(5).
Revenue Bonds ~ 469.103
An economic development authority may, by resolution decide to
issue revenue bonds.
acquisition of land,
purchase, construct,
They may be issued to provide funding for the
to purchase of construct facilities, to
install, or furnish capital equipment to
operate a facility for economic development of any kind, or to pay
9
to extend or enlarge any project under the authority's control.
Minn. Stat. § 469.103(1).
In issuing general obligation or revenue bonds, the authority
may secure the payment of the principal and the interest on the
bonds by a pledge or lien on authority revenue. The revenue must
come from the facility to be acquired, constructed, or improved
with the bond proceeds or from other facilities named in the bond-
authorizing resolutions. The authority may also secure the payment
with its promise to impose, maintain, and collect enough rentals,
rates, and charges, for the use and occupancy of the facilities and
for services furnished in connection with the use and occupancy of
the facilities. Revenues pledged by the authority must not be used
or pledged for any other authority purpose or to pay any other
bonds issued under this section or under section 469.102, unless
the other use or pledge is specifically authorized in the bond-
authorizing resolutions.
Revenue bonds issued under § 469.103 are not debt of the
authority's city nor a pledge'of that city's full faith and credit.
The bonds are payable only from project revenue as described in §
469.103.
Obligations secured or payable from tax increment revenues and
issued pursuant to S 469.102 or S 469.103 are subject to the
provisions of ~ 469.178, dealing with tax increment bonding
A city may, at the request of the authority, levy a tax for
the benefit of the authority. The tax must not be more than
l0
to extend or enlarge any project under the authority's control.
Minn. Stat. S 469.103(1).
In issuing general obligation Or revenue bonds, the authority
may secure the payment of the principal and the interest on the
bonds by a pledge or lien on authority revenue. The revenue must
come from the facility to be acquired, constructed, or improved
with the bond proceeds or from other facilities named in the bond-
authorizing resolutions. The authority may also secure the payment
with its promise to impose, maintain, and collect enough rentals,
rates, and charges, for the use and!occupancy of the facilities and
for services furnished in connection with the use and occupancy of
the facilities. Revenues pledged by the authority must not be used
or pledged for any other authority purpose or to pay any other
bonds issued under this section or under section 469.102, unless
the other use or pledge is specifically authorized in the bond-
authorizing resolutions.
Revenue bonds issued under S 469.103 are not debt of the
authority's city nor a pledge of that city's full faith and credit.
The bonds are payable only from project revenue as described in §
469.103.
Obligations secured or payable from tax increment revenues and
issued pursuant to ~ 469.102 or ~ 469.103 are subject to the
provisions of ~ 469.178, dealing with tax increment bonding
A city may, at the request of the authority, levy a tax for
the benefit of the authority. The tax must not be more than
10
appeal the authority's decision by filing a notice of appeal with
the district court in the city or economic development district's
county and serving notice on the authority's secretary within
twenty days after the decision of the authority was entered. The
only grounds for filing an appeal is that the actions of the
authority were arbitrary, capricious, or contrary to law. Minn.
Stat. § 469.105(3).
There are specific terms and' conditions for the sale of
property which can be found in detail at Minn. Stat. § 469.105.
ADVANTAGES OF CREATING ECONOMIC DEVELOPMENT AUTHORITY
There are many advantages that will accrue to the City of
Columbia Heights as a result of establishing an economic
development authority. First, the newly created EDA will have all
of the powers of the existing HRA, however, it will also have the
power to become a limited partner in economic development ventures,
to participate in certain public relations activities, to exercise
any of the delegated powers in connection with mined underground
space development, it may supply small business capital, and it may
apply for foreign trade zone powers with the federal government.
Additionally, the EDA may be organized in a manner consistent with
other city departments. This will streamline its structure and
reduce costs. The EDA may take advantage of city services and
facilities. The budgetary process and accounting procedures will
be in accordance with other city departments. Another significant
advantage is the fact that the EDA commissioners may be members of
the city council. This will significantly increase the
12
accountability of the EDA to the general public.
13
RESOLUTION NO. 92 -
BEING AN ENABLING RESOLUTION CREATING AN ECONOMIC DEVELOPMENT
AUTHORITY IN COLUMBIA HEIGHTS, MINNESOTA
WHEREAS:
A hearing has been held by the City Council of Columbia
Heights on December 14, 1992, at Columbia Heights,
Minnesota, to determine the need and existence of an
Economic Development Authority to function in such city;
and
WHEREAS:
Facts have been submitted to this body indicating that
there is a need for an Economic Development Authority to
function in the City of Columbia Heights, Minnesota; and
NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
COLUMBIA HEIGHTS, MINNESOTA
That the City Council of the City of Columbia Heights, Minnesota,
pursuant to Chapter 469 of the Minnesota State Statutes, hereby
finds, determines and dec]ares:
It is hereby declared that an Economic Development
Authority shall exist in said City, as of 12:00 a.m.,
January 1, 1993, and such Authority shall exercise the
powers, subject to the limitations of this resolution, as
provided in Minnesota State Statute 469.090 to 469.108,
or other law. Further, the Authority shall specifically
be granted the exercise of the powers granted pursuant to
M~nnesota State Statute 469.102, 469.103, 469.105 and
469.107.
It is hereby declared that an Economic Development
Authority shall exist in said city, as of 12:00 a.m.
January i, 1993, and such Authority, subject to the
limitations of this resolution, as provided in Minnesota
State Statute 469.001 to 469.047, or other law. Further,
the Authority shall specifically be granted the exercise
of the powers granted pursuant ~to Minnesota State Statute
469.029, 469.033, 469,034 and 469.042.
It is hereby declared that an Economic Development
Authority shall exist in said City, as of 12:00 a.m.,
January 1, 1993, and such Authority shall exercise the
powers pursuant to city development, districts, subject
to the limitations of this resolution, as provided in
Minnesota State Statute 469.124 to 469.134, or other law.
Further, the Authority shall specifically be granted the
exercise of the powers granted pursuant to Minnesota
State Statute 469.I29 and 469.130.
Resolution No.92 -
page 2
It is hereby declared that said Economic Development
Authority shall be governed by a board of commissioners
("Commissioners") consisting of five members and the City
Council of Columbia Heights shall serve as the
Commissioners. The terms of the Commissioners shall
coincide with their terms of office as members of the
City Council in that suCh term shall expire with the
expiration of the Council term being served.
It is hereby declared that all financial books, records,
accounts, and reports of the Economic Development
Authority shall be prepared, presented and retained by
the Finance Department of the City, which department
shall have the responsibility for administering the
finances of the Economic Development Authority as it does
the finances of the City~
It is hereby declared that the Economic Development
Authority shall be subjedt to the following limitations:
(a) That the authority shall not exercise any of the
powers contained in Minnesota State Statutes 469.001 to
469.047, 469.090 to 469.108, and 469.124 to 469.134
without prior consent to. the City Council;
(b) That, except when previously pledged by the
authority, the City Council may by resolution require the
authority to transfer any portion of the reserves
generated by activities of the authority that the City
Council determines is not necessary for the successful
operation of the authority to the debt service fund of
the City, to be used solely to reduce tax levies for
bonded indebtedness of the City;
(c) That the sale of all bonds or obligations issued by
the authority be approved by the City Council before
issuance;
(d) That the authority follow the bUdget process for city
departments as provided by the City, and as implemented by
the City Council and the Mayor;
(e) That all official actions of the authority should be
consistent with the adopted comprehensive plan of the
City, and any official controls implementing the
comprehensive plan;
(f) That the authority submit all planned activities for
influencing the action of any other governmental agency,
subdivision, or body of the City Council for approval;
Reso]utJc.~n No. 92 -
page 3
(g) That the authority submit its administrative
structure and management practices to the City Council
for approval.
Passed this 14th day of December, 1992.
Offered by:
Seconded by:
Roll call:
Mayor Donald J. Murzyn, Jr.
Jo-Anne Student, Council Secretary
RESOLUTION NO. 92 -
BEING A RESOLUTION DECLARING THE TRANSFER OF CONTROL, AUTHORITY
AND OPERATION OF ALL HOUSING AND REDEVELOPMENT AUTHORITY
PROJECTS
BE IT RESOLVED, by the City. Council of Columbia Heights,
Minnesota,
1. That the control, authority and operation of any property,
project or program authorized by Minnesota State Statute
469.001 to 469.047 or any other project or program authorized
or undertaken by the Coilumbia Heights Housing and
Redevelopment Authority is hereby transferred, as of 12:00
a.m. January 1, t993, to the Columbia Heights Economic
Development Authority, created pursuant to Minnesota State
Statute 469.090 to 469.108, or other law, and Resolution No.
92 - of the Columbia Heights City Council.
2. That the Columbia Heights Economic Development Authority
shall covenant and pledge to perform the terms, conditions,
and covenants of the bond indenture or other agreements
executed for the security of any bonds issued by the Columbia
Heights Housing and Redevelopment Authority.
3. That all rights of the. Columbia Heights Housing and
Redevelopment Authority against any persons, firms, or
corporations, as they pertain to the projects herein described
in subsection 1 of this reso:lution, shall accrue to and be
enforced by the Columbia .Heights Economic Development
Authority.
4. That all the debts, obligations, and liabilities of the
Columbia Heights Housing and Redevelopment Authority, as they
pertain to the projects herein described in subsection 1 of
this resolution, shall be enforceable against the Columbia
Heights Economic Development Authority.
Passed the 14th day of December, 1992.
Offered by:
Seconded by:
Roll call:
Mayor Donald J. Murzyn, Jr.
Jo-Anne Student, Council Secretary
0
~Z
0
0
Housing & Redevelopment Authority
of Columbia Heights
Commissionerl
Eusebius Heintz
Patricia Jindra
Bruce Nawrocki
Richard Dustin
Jori P. Pawluk
590 N.E. 40th Avenue, Columbia Heights, MN 55421
Fax: (612) 782-2801 · (612) 782-2854
DATE:
TO:
FROM:
SUBJECT:
November 20, 1992
Stuart Anderson, city Manager ~
Donald R. Schneider, Executive Director
FOLLOW-UP QUESTIONS FOR CITY COUNCIL ON HRA ISSUE
As per your request of November 17, the following is provided in response to
your questions on savings as a result of the City Council becoming the HRAor
EDA Board of Commissioners.
Elimination of Aqenda and backup material provided for HRA Board.
Unless the City Manager would be doing the agenda and all backup
materials for the HRA/EDA business, savings in this area would be
minimal. As I understand, HRA staff would still have to prepare
City Council letters (not necessary now for HRACommissioner items)
and all related backup materials. The City and HRAwould have the
savings of not making up agenda packets for 4 Commissioners.
Savings are estimated at 7.5 cents per copy @ 50 copies per meeting
for 2 meetings per month for 4 packets for a total of $360 per
year. In addition there would be saving of staff time for
duplicating efforts when items have to be approved both by the HRA
and Board of Commissioners and City Council. We would estimate
staff time savings of 10 to 15 hours per month at an average
approximate cost of $20 per hour or $300/month or $3,600 per year.
However, this staff time could be used on other HRA activities.
(Total savings of $3,960.)
Elimination of double financial records; includinq payment of
bills, payroll, etc. This is very difficult to estimate. Costs
savings related to the Financial Coordinator position and elimina-
tion of outside accounting are cited below. We would save the cost
of staff in preparing and disbursing checks and in maintaining the
copies of the checks, etc. We estimate that we would save
approximately 8-10 hours of staff time (other than Financial
Coordinator) at $12 per hour for $120/month or $1,440 per year.
(Total savings of $1,440/year.)
Elimination of second audit. The FY1991 audit of the HRA cost
$5,000. The FY1992, if done by Deloitte - Touche, will cost
$7,000. Due to HUD requirements for HUD funded projects, CDBG and
Parkview Villa Highrise, it is estimated that approximately $3,000
to $4,000 will be saved in this area for the audit. In addition
there will be come staff time saved (other than Financial Coordina-
tor) with the savings estimated at $500.00. (Total estimated
savings of $4,500.)
Equal Opportunity Employer Equal Housing Opportunity Agency
R~ FOLLOW-UP QUESTIONS FOR CITY COUNCIL ON HRA ISSUE
PAGE 2
Investment of surplus funds. The Financial Coordinator currently
invests surplus funds. With his position eliminated below, there
would be no additional savings for HRA staff time. However, when
our surplus funds are combined with city funds it is expected that
better interest rates could be secured on investments. We estimate
that with $500,000 in reserves invested at a 1% higher rate would
earn (or save) for the HRA an additional $5,000/year. (Total
savings of $5,000/year.)
Cost of manaqing personnel issues (hirinq, discipline, etc.)
Depending on personnel turnover and problems during the year, we
would estimate that $2,000 to $3,000 are spent on personnel issue
matters. This year with legal costs, settlement on Daniels case,
and other personnel issue costs, we have spent approximately
$5,000. (Total average estimated savings of $3,000.)
Identify actual costs paid to outside accountant, the cost of the
Financial Coordinator, the cost of financial computer software and
maintenance aqreement, etc.
The HRAhas paid Bauer-Jackson $9,567 through October for
outside accounting services. Approximately another
$1,600 will be paid prior to year end, for a total of
approximately $11,167. However, staff is currently
implementing an internal accounting system with the
assistance of the City Finance Department. With an
internal system the HRA will only need minimal outside
accounting support. If we count the total outside
accounting cost, the savings would be approximately
$11,200. With only minimal outside accounting support
there would only be a savings of $1,000 to $2,000 per
year. (Total savings in 1993 estimated at $9,200.)
Be
Elimination of the Financial Coordinator (24 hour/week)
position would provide a possible savings of $22,500.
However, this is providing the city Finance Department
can do the work without any additional staff. The are
numerous reports and other requirements that must be
addressed to meet Department of Housing and Urban
Development (HUD) requirements on the Parkview Villa
Highrise (MN 105001) project. (Savings of approximately
$22,500 per year.)
The cost for the financial computer software and mainte-
nance agreements are $2,100 per year. (Saving of approxi-
mately $2,100 per year.)
(Total estimated savings in item ~6: $33,800.)
HRA Commissioner per diem payments. Based on an average of two
meetings per month at $35.00 per meeting for 4 commissioners for 12
months there would be a savings of $1,680 for the year.
COMBINED TOTAL ESTIMATED SAVINGS: $53,380/YE~R.
The above estimates are dependent on many variables and savings could be
greater or less depending on how the HRA is structured after the city Council
becomes the governing body.
Please call me if you need anything further or if you have any questions.
Establishment
A city may by
DISCUSSION
adopting an enabling resolution, create a
economic development authority which has the powers contained in
Minn. Statute § 469.090 to 469.108 and the powers of a housing and
redevelopment authority under Minn. Statute § 469.001 to 469.047.
The creation of an authority by a city must be by written
resolution. Before adopting the resolution, the city must hold a
public hearing with the required statutory notice given. Minn.
Stat. § 469.093(1).
Transfer of Authority
The city may, by resolution transfer, the control, authority
and operation of any project defined in section 469.174(8) or any
other project authorized by sections 469.001 to 469.047 (housing
and redevelopment authority), or 469.124 to 469.134 (city
development districts), that are within the city, from the agency
that established it to the economic development authority.
Subsequent the transfer, the economic development authority may
excersise all of the powers that the agency establishing the
project could have excersised. Minn. Stat. § 469.094(2).
Once a project has been transferred to the economic
development authority, the authority shall be held to perform the
terms, conditions, and covenants of the bond indenture or other
agreements executed for the security of any bonds issued by the
governmental subdivision that originated the project. In addition,
the economic development authority may excersise all the powers
MEMORANDUM
To: Stu W. Anderson
From: Gregg Woods
Date: October 21, 1992
Re: Disbandment of the HRA and the creation of an Economic
Development Authority
ISSUE
How may the city disband the current HRA and still continue
the activities of the Housing and Redevelopment Authority?
CONCLUSION
Under Minn. Stat. § 469.090 to 469.108 a city may consolidate
the functions of a housing and redevelopment authority and an
economic development authority. The city, may, by resolution
transfer the control, authority,, and operation of any project as
defined in section 469.001 to 469.047 located within the city, from
the agency that established the project to the economic development
authority. The economic development authority may excersise all of
the powers that the governmental unit establishing the project
could excersise with respect to the project. Minn. Stat. §
469.04(2).
By establishing an economic development authority, the city
council may dissolve the current housing and redevelopment
authority, but yet, retain the ability to perform the functions and
projects previously administered by the HRA.
necessary to perform the terms and conditions of any indenture or
other agreements executed for the security of the bonds. They
shall also become obligated on the bonds when the project or
program is transferred pursuant to Minn. Statute § 469.094(2).
Transfer of Personnel and Appointment of Commissioners
The city council may, by resolution, place any employees of
the housing and redevelopment authority under the direction,
supervision, or control of the economic development authority.
Transfer of employees to the economic development authority does
not affect the rights of the employee, including those that may
exist under collective bargaining agreements or fringe benefit
plans. Minn. Stat. § 469.094(3).
The enabling resolution may provide that the members of the
city council shall serve as the commissioners of the authority.
Minn. Stat. § 469.095(2)(d). The enabling resolution may further
provide for the appointment of additional commissioners in excess
of the number of city council members. Minn. Stat.
469.095(2) (e). Normally, commissioners would be appointed for six-
year terms, however, the council may set the term of the
commissioners who are members of the city council to coincide with
their term of office as members of the city council. Minn Stat.
469.095(2) (f) .
Powers of the Authority
Property: Pursuant to Minn. Stat. § 469.101(2), (3), (4), (5),
(6), (7), (10), (13), and (17).
!. The authority may acquire by lease, purchase, gift,
devise, or condemnation proceedings the needed rights and interest
in properties to create economic development districts.
2. They may sign options to purchase, sell or lease property.
3. The authority has the right to acquire property through
the use of eminent domain or if it is authorized under it's city's
charter, by condemnation.
4. The economic development authority may enter into
contracts for the purpose of economic development, within the
powers given it in § 469.090 to 469.108.
5. An authority may be a partner or a limited partner in a
partnership whose purpose is consistent with that of the authority..
6. An authority may acquire the rights of an easement for the
development of an economic district.
7. The economic development authority may accept money, land,
or any other assistance in any form from, the federal or state
government or a subdivision thereof, in order to acquire and
develop an economic development district.
8. The authority may sell or lease land held by it for
development in economic development districts.
9. The authority may maintain and operate public facilities
(i.e. parking ramps) to promote economic development in an economic
development district.
10. The authority may accept conveyances of land from other
public agencies or other units of government, if the land may be
properly used by the authority to promote economic development in
an economic development district.
Limits of Powers
The enabling resolution approved by the city council may
impose the following limits upon the powers and actions of the
authority:
1. The authority must obtain prior approval from the city
council before excersising
sections 469.001 to 469.047,
469.134.
the specified powers contained in
469.090 to 469.108 and 469.124 to
2. The city council may require the authority to transfer any
portion of the reserves generated by the authority, not previously
pledged, to the debt service fund of the city to be used solely to
reduce tax levies for bonded indebtedness of the city.
3. The city may require that the sale of all bonds or
obligations issued by the authority be approved by the city prior
to issuance.
4. The resolution may require that the authority follow the
budget process required for city departments.
5. The city may require that all official actions of the
authority are consistent with the comprehensive plan of the city.
6. The city may require that the authority submit all planned
activities for influencing the action of any other governmental
agency, subdivision, or body to the council for approval.
7. They may require that the authority submit their
administrative structure and management practices to the council
for approval.
8. The council may include in the enabling resolution any
5
other limitation or control deemed necessary. Minn. Stat. §
469.092(1).
The enabling resolution may be modified at any time provided
that the limitations imposed are not applied in such a manner as to
impair the security of any bonds issued or contracts executed
before the modification is imposed. In addition, the council must
not modify any limit in effect at the time any bonds or obligations
are issued or contracts executed to the detriment of the holder of
the bonds or obligations, or any contracting party. Modifications
must be made in compliance with the procedural requirements set out
in section 469.093. Minn. Stat. 469.092(2), (3), and (5).
Bonds
An economic development authority may issue general obligation
bonds in the principal amount authorized by a two-thirds majority
vote of the city council. The bonds may be issued in anticipation
of income from any source. They may be issued: (1) to secure
funds needed to pay for acquired property, (2) for any other
purpose authorized by sections 469.090 to 469.108. Minn Stat. §
469.102(1) .
An economic development authority may, by resolution decide to
issue revenue bonds. They may be issued to provide funding for the
acquisition of land, to purchase of construct facilities, to
purchase, construct, install, or furnish capital equipment to
operate a facility for economic development of any kind, or to pay
to extend or enlarge any project under the authority's control.
Minn. Stat. § 469.103(1).
Sale of Property
An economic development authority may sell or convey any
property under its control within a city or economic district if it
determines that the sale or conveyance is in the best interest of
the city or district, and that the sale furthers its purpose of
economic development. Minn Stat. § 469.105(1).
Tax Levies
A city may, at the request of the authority, levy a tax for
the benefit of the authority. The tax must not be more than
0.01813 percent of taxable market value. The tax must be paid by
the city treasurer to the treasurer of the authority and the money.
is to be spent only by the authority. A city may increase its levy
in accordance with section 469.107(2). Minn. Stat. § 469.107.
7
0
0
0
o
CITY OF COLUMBIA HEIGHTS
TO:
FROM:
SUBJECT:
DATE:
DON SCHNEIDER, HRA EXECUTIVE DIRECTOR
PATRICK HENTGES, CITY MANAGER
HRA COMMUNITY DEVELOPMENT POSITION/CITY
INSPECTOR POSITION
APRIL 22, 1993
ASSISTANT BUILDING
References made to our past discussions regarding the potential consolidation of some or all of the various
HRA community development and housing services with the City's Building, Planning services, I am
suggesting that two courses of action be followed:
1) City Conducts Section 8/Voucher Housing Inspections
I am proposing that the City take the responsibility of conducting all of your Section 8 or Voucher
inspections. We have estimated the inspection activity, including advanced arrangement, actual
inspection, and follow up to be 400 hours annually. The actual administration and qualification
activity would continue to be performed by the HRA. We are confident that the Assistant Building
Inspector position could handle those responsibilities which will amount to approximately one-
quarter of his/her job hours.
The City has conducted an interview process for the Assistant Building Inspector and has identified
an excellent candidate who possesses multi-disciplinary skills and has particular exposure to rental
and Section 8 housing inspections. Accordingly, I feel comfortable with immediately appointing the
position and taking on the HRA inspection activities. The matter of service reimbursement on the
part of the HRA could be deferred until after the transition or at such time the larger question of
HRA/City staff consolidation into one department is resolved. This would enable you to more
closely evaluate the replacement of the HRA position vacancy and also give you a certain level of
leadway to reassign responsibilities within your organization. We both conclude at this point that
neither the HRA or City can save totally one position.
Total Consolidation of HRA/City Staff
It appears from our discussion that you are amiable to consolidating the HRA staff with the City
Building/Planning and Zoning staff to create a City Community Development Department. I concur
that the consolidation could not only result in staff efficiency and economy, but also position the
City and HRA to more effectively address many of the emerging housing and economic
development issues.
I have requested that the Assistant to the City Manager analyze the pay equity/compensation issues
associated with consolidating the HRA staff into the City organization. Upon completion of the
analysis, I would like to discuss with you an organizational plan including the creation of a City
Community Development Department, the ongoing administration of the HRA Board or
alternatively the establishment of an Economic Development Authority. I would like to report our
preliminary findings to the City Council at the first or second work session in May.
If you have any additional comments or concerns, please do not hesitate to contact me.
PH:bj
Housing & Redevelopment Authority
of Columbia Heights
Oomrnls~ioner$
Eusebius Heintz
Patricia Jindra
Bruce Nawrocki
Richard Dustin
Donald J. Murzyn, Jr.
590 N.E. 40th Avenue, Columbia Heights, MN 55421
Fax: (612) 782-2857. (612) 782-2854
TO:
FROM:
PATRICK HENTGES, CITY MANAGER
Don Schneider, HRA Executive Director~
DATE: APRIL 23, 1993
CONSOLIDATION OF HRA/CITY POSITIONS(YOUR MEMO OF APRIL 13)
It is possible to gain some economies of operation by possibly consolidating the
City Building Department and the HRA into one Housing, Building, Community
Development, and Redevelopment Department. In coordination with that
consolidation, it appears that it would be best to have the City employ the HRA
staff as City employees. The HRA would then be administered by the City
employees whose expense would be reimbursed by the HRA, similar to the way it is
set up in Fridley and other cities.
By consolidating the City Building Department and the HRA and having the HRA
employees as City employees, we could have the City provide personnel services
for the HRA, further integrate the HRA financial into the City, have the Rental
Assistance Program Housing Quality Standard(HQS) inspections completed by the
City Assistant Building Inspector(as long as they would be completed as needed
and on basis of HQS and not City Code), and have the Planning and Zoning
functions in one department. It would not, however, eliminate the need for a
person in the Community Development Coordinator position unless it is the desire
of the City to become less involved in current and new community and economic
development programs.
The economies that could be realized would ultimately include a reduction in cost
for the HRA Occupancy Specialist position. If we continue with only
approximately 195 to 205 units in Columbia Heights and Hilltop and have all of
the inspections completed by the City Assistant Building Inspector, that position
could possibly be reduced to 30 hours per week saving one fourth of that position
salary(savings of approximately $7,576 including benefits).
There may be other economies that we can further discuss. I believe a
consolidation of the HRA and Building Department can work and that it could be
advantageous to the HRA and City to have the HRA employees as City employees.
Equal Opportunity Employer Equal Housing Opportunity Agency
DRAFT FOP.
Di$CU,S$ O 4 ONLY
ORD'I'NAN'C~. N'O:
BEING AN ORDINANCE AMENDING ORDINANCE NO. 853, COLUMBIA HEIGHTS ZONING CODE
PERTAINING TO ZERO LOT LINE.
The City of Columbia Heights code ordain:
SECTION 8: Chapter 9, Article I, Section 8, 9.108, (2) of Ordinance No. 853,
Columbia Heights, which currently reads as follows:
9.108 (2)
Conditional Uses
Within any "R-2" Two Family Use District, no structure or land shall be used for
the following uses except in accord with an approved conditional use permit.
(a)
Any use listed in Section 9.107 (2) and as regulated therein shall
be a use by conditional use permit.
(b)
Off-street parking when the proposed lot for such off-street parking
is located in any block or area which is zoned, used, or otherwise
permitted for any non-residential use or uses and abuts on a lot or
parcel which is in a "B" or "1" District and is in the same
ownership or control as the land in the "B" or "1" District and
subject to those conditions set forth in Section 9.116 (4) herein
and such other conditions as may be found necessary by the City
Council to carry out the intent of this Ordinance, and providing
that such lot or parcel is not located between two abutting
residential uses, and provided that such off-street parking is
restricted to an area for a distance from the abutting edge of the
"B" or "1" District equal to the combined widths of three continuous
platted lots or 150 feet, whichever is greater; and no public street
divides such parking area.
IS HEREWITH AMENDED TO READ AS FOLLOWS:
9.108 (2)
Conditional Uses
Within any "R-2" Two Family Use District, no structure or land shall be used for
the following uses except in accord with an approved conditional use permit.
(a)
Any use listed in Section 9.'107 (2) and as regulated therein shall
be a use by conditional use permit.
(b)
Off-street p~rking when the proposed lot for such off-street parking
is located in any block or area which is zoned, used, or otherwise
permitted for any non-residential use or uses and abuts on a lot or
parcel which is in a "B" or "1" District and subject to those
conditions set forth in Section 9.116 (4) herein and such other
conditions as may be found necessary by the City Council to carry
out the intent of this Ordinance, and providing that such lot or
parcel is not located between two abutting residential uses, and
provided that such off-street parking is restricted to an area for
a distance from the abutting edge of the "B" or "1" District equal
to the combined widths of three continuous platted lots or 150 feet,
whichever is greater; and no public street divides such parking are~
Day nursery, provided not less than 75 square feet of outside play
space per pupil is provided and said space is fenced.
(d)
PAGE 2
Zero lot line for two-family residential lots. Notwithstanding the
provisions of this Chapter to the contrary, two-family residential
lots may be platted or subdivided in such manner that the common
boundary line for the residential units will have a zero lot line
setback; provided, however, that each such lot meets the following
requirements:
(1)
Each new or redeveloped (where previous dwelling unit
has been cleared) lot shall have a minimum of 5,000
square feet per dwelling unit.
(2)
Lot with existing duplex units to be split must have a
minimum of 8,400 total square feet of land area, total
to insure not less than 4,000 square feet minimum for
each dwelling unit for either side.
(3)
Separate services shall be furnished to each dwelling
unit for sanitary sewer and water.
(4)
Existing duplex units which are split as per paragraph
b above shall have separate water meters or services.
(5)
The dwelling units are constricted in a side-by-side
manner.
(6)
The units shall be separated by no less than one hour
fire resistive construction.
(7)
(8)
(9)
(10)
SECTION 2:
As a minimum, each unit shall have two off-street
parking spaces, one of which shall be a garage. All
parking or driving surfaces shall be concrete or asphalt
Ail zero lot line two-family dwellings shall require a
party wall agreement relating, at a minimum, to mainte-
nance of the structure, maintenance of open and/or
common space, accessory structures, and exterior
decoration. The agreement shall be approved by the City
Attorney and kept on file in the office of the Director
of Community Development.
Access to the rear of the lot must be provided either by
easement from one side to the other or easement with an
adjoining lot.
Easements of any type must be recorded with Anoka County
Recorder.
Lot splits under this Ordinance must comply with Section
7, 9.407 of Ordinance No. 853.
This Ordinance shall be in full force and effect from and after
thirty (30) days after its passage.
First Reading:
Second Reading:
Date of Passage:
Offered by:
Seconded by:
Roll Call:
Donald J. Murzyn, Jr., Mayor
Jo-Anne Student, Council Secretary
Ordinance tOG.
CITY COUNCIL LETTER
MEETING OF: APRIL 26, 1993
AGENDA SECTION: ORDINANCES AND ORIGINATING DEPT.: CITY MANAGER
RESOLUTIONS FINANCE APPROVAL
NO:
ITEM: GENERAL OBLIGATION TAX BY: WILLIA~ ELRITE B~: '3,.~ ~ } ~ ...-~.,.~..q~
INCREMENT REFUNDING BONDS, ~ ~',~-
SERIES 1993A DATE: APRIL 21, 1993 z-] j ~k~ JR ~
NO:
Dan Hartman of Springsted and Cleo Rasmussen of Miller Schroeder met with the City Manager,
Finance Director and Council Member Nawrocki on April 21, 1993, to review the financial
advantages of refunding the Tax Increment Bonds of 1987. At this time it is projected that refunding
of these bonds would result in a savings to the City of approximately $37,000 depending on the
actual market rates at the time of the sale. These bonds were originally sold in 1987 as a General
Obligation Taxable Tax Increment Issue to finance the Sullivan Shores Development. Based on this
meeting, it is Springsted's recommendation to take advantage of the current rates and net savings
at this time.
Attached is an ordinance authorizing the refunding of the General Obligation Tax Increment
Refunding Bonds of 1987. The ordinance was prepared and reviewed by Holmes and Graven, bond
council for the City.
RECOMMENDED MOTION: Move to waive the reading of the ordinance, there being a~p~,!~opies
~to the public. '-~ ~~2t~
"~ RE~OMMENDEDMOTION: Move to schedule the second reading for the t~ay~ ,19~3, City~~
Council meeting of Ordinance 1266, being an Ordinance authorizing issuance ~f up'to
$735,0~
efunding General Obligation Tax Increment Refunding Bonds, Series 1993A.
WE:dn
Attachment
9304212
COUNCIL ACTION:
ORDINANCE NO. 1266
ORDINANCE PROVIDING FOR THE ISSUANCE AND SALE
OF APPROXIMATELY $735,000 GENERAL OBLIGATION
TAXABLE REFUNDING BONDS, SERIES 1993A
The City of Columbia Heights does ordain:
1. It is hereby determined that:
(a) the City is authorized by Minnesota Statutes, Chapter 475 (Act)
and Section 475.67, Subdivision 3, of the Act to issue and sell its general
obligation bonds to refund obligations and the interest thereon before the due
date of the obligations, if consistent with covenants made with the holders
thereof, when determined by the City Council to be necessary or desirable for
the reduction of debt service cost to the City or for the extension or
adjustment of maturities in relation to the resources available for their
payment;
(b) subdivision 4 of the Act permits the sale of refunding obligations
during the six month period prior to the date on which the obligations to be
refunded may be called for redemption;
(c) it is necessary and desirable to reduce debt service costs that the
City issue approximately $735,000 General Obligation Taxable Refunding
Bonds, Series 1993A (Bonds) to refund certain outstanding general
obligations of the City;
(d) the outstanding bonds to be refunded (Refunded Bonds) consist
of the $1,100,000 General Obligation Taxable Tax Increment Bond of 1987,
Series A, dated August 1, 1987, of which $710,000 in principal amount is
currently callable on August 1, 1993.
2. To provide moneys to refund the Refunded Bonds, the City will issue
and sell Bonds in the approximate amount of $727,650. To provide in part the
additional interest required to market the Bonds at this time, additional Bonds will
be issued in the amount of $7,350. The excess of the purchase price of the Bonds
over the sum of $727,650 will be credited to the debt service fund for the Bonds for
the purpose of paying interest first coming due on the additional Bonds. The Bonds
will be issued, sold and delivered in accordance with the terms of the following
Official Terms of Offering:
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
TERMS OF PROPOSAL
$735,000'
CiTY OF COLUMBIA HEIGHTS, MINNESOTA
GENERAL OBLIGATION TAXABLE REFUNDING BONDS, SERIES 1993A
DETAILS OF THE BONDS
The Bonds will be dated July 1, 1993, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year,' commencing February 1, 1994. Interest will
be computed on the basis of a 360-day year of;twelve SO-day months. The Bonds will be
issued in the denomination of $5,000 each, or in integral multiples thereof, as requested by the
purchaser, and fully registered as to principal and interest. Principal will be payable at the main
corporate office of the registrar and interest on eaCh Bond will be payable by check or draft of
the registrar mailed to the registered holder thereof at the holder's address as it appears on the
books of the registrar as of the close of business 0n the 15th day of the immediately preceding
month.
The Bonds will mature February ! in the years and amounts as follows:
1994 $160,000
1995 $185,000
1996 $190,000
1997 $200,000
The City reserves the right, after the proposal is received, to increase or reduce the principal amount
of the Bonds offered for sale. Any such increase or reduction will be in a total amount not to exceed
$10,000 and will be made in multiples of $5,000 in any o! the maturities In ~he event ~he principal
amount of rhe Bonds /s increasec~ or rec~uced, any premium offered or any discount taken will be
increased or reduced by a percentage equal to the,percentage Dy which me principal amount of the
Bonds is increased or reduced.
OPTIONAL REDEMPTION
The Bonds will not be subject to payment in advance of their respective stated maturity dates.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition the City will pledge tax
increment revenues generated from the City's "Downtown C.B.D. Revitalization Project." The
proceeds will be used to refuncf the 1994-19971 maturities, totaling $710,000, of the City's
General Obligation Taxable Tax !ncrement Bonds of 1987, Series A.
TAXABILITY OF INTEREST
The interest to be pard on the Bonds is includable in gross income of the recipient for Un;ted
States and State ct Minnesota incon~e tax purposes, and is subject to Minnesota Corporate
and bank excise taxes measured by net income.
TYPE OF PROPOSALS
The Proposal shall be for not less than $727,650 and accrued interest on the total principal
amount of the ~onds. Rates shall be in integraJ multiples of 5/~ 00 or !/8 of 1% Rates mL~st be
in ascending order. Bonds of the same maturity !sha!l bear a single rate from the date of the
Bonds to the date of maturity. No conditional proposals will be accepted
-1-
3. Springsted Incorporated negotiated the sale and purchase of the Bonds
in accordance with the foregoing Terms with Miller & Schroeder Financial, Inc. The
City Council will meet..~.'~8,_l~9,..rri~_o~q~ ~a~_,,-~Ju,~, ~,~/l~to consider the sale
of the Bonds h-nd take a'nl~other app~ropriate acti~on with-respect to the Bonds.
4. This ordinance shall be in full force and effect from and after thirty
(30) days after its passage.
First Reading:
Second Reading:
Offered By:
Seconded By:
Roll Call:
Date of Passage:
Mayor
Council Secretary
Attest
City Clerk-Treasurer
SNG52324
CL:].62-12
C, o]umbia Heights, Minnesota
G.O. Taxable Refunding Bonds, Series 1993A
Current Refunding Summary
Prepared: 04/01/93
By SPRINGSTED Incorporated
Partial Current Refunding of
TAXABLE G.O. Tax Increment Bonds of 1987
Even Annual Savings Structure
Refunding Bond Rating: A1
Date of Bonds: 07/01/93
IDelivery Date: 07/21/93
IRefunded Call: 08/01/93
[1 st Callable: 02/01/94
Refunding Delivery Date Sources / Uses
Sources of Funds on: 07/21/93
Refunding Principal:
Accrued Interest:
Total Sources of Funds:
735,000.00
1,849.32
736,849.32
Uses of Funds on:
07/21/93
Discount ~ $10.00 :
Acc. Int. & Unused Disc:
Refunding Expenses:
Investment to Call Date:
Total Uses of Funds:
7,350.00
1,849.32
18,125.00
709,525.00
736,849.32
Refunded Bond Call Date Sources/Uses
Sources of Funds on:
Invest. Proceeds Mature:
/nv. Earnings @ 2.75%:
Funds from Issuer;
Total Sources of Funds:
08/01/93
¢
709,525.00
542.00
710,067.00
Uses of Funds on:
Refunded Principal:
Refunded Call Premium:
Excess Proceeds:
Total Uses of Funds:
08/01/93
710,000.00
67.00
710,067.00
iRefunded / Refunding Bond Comparison
As of: Refunded Refunding
07/01/93 Statistics Statistics
Principal: 710,000 735,000
Interest: 140,979 75,330
Bond Yrs: 1,554 1,594
Avg. Mat: 2.189 2.168
NIC: 9.07% 5.19%
Total Net Savings/Present Value Savingsl
Future Savings:
Less Funds From Issuer:
Plus Accr. Int. to DIS Fund:
Plus Exc. Proc. to D/S Fund:
Total Net Savings:
35,304.79
1,849.32
67.00
37,221.11
Present Value Sav ~ 4.72%:
As % of P.V. Refunded Int.:
34,491.90
27.41%
C%Olumbia Heights, Minnesota
TAXABLE G.O. Tax Increment Bonds of 1987
Existing Debt Service
Schedule A
Date
Principal
Prepared: 04/01/93
By SPRINGSTED Incorporated
Rate Interest Semi-Annual
Annual'
08/01/93
02/01/94
08/01/94
02/01/95
08/01/95
02/01/96
08/0!/96
02/0i/97
32,065.00 32,065.00
155,000.00 8.900% 32,065.00 187,065.00
25,167.50 25,167.50
170,000.00 9.000% 25,167.50 195,167.50
!7,517.50 17,517.50
185,000.00 9.100% 17,517.50 202,517.50
9,100.00 9,100.00
200,000.00 9.!00% 9,100.00 209,100.00
219,130.00
220,335.00
220,035.00
218,200.00
Totals
Bond Years:
Avg. Mat..:
NIC ....... :
710,000.00
1,554.17
2.189
9.071%
167,700.00
All lower calculations
are made from the date
of the refunding bonds
877,700.00
877,700.00
Columbia Heights, Minnesota
TAXABLE G.O. Tax Increment Bonds of 1987
Refunded Principal and any Call Premium
Schedule B
Date Principal Premium
Prepared: 04/01/9~'
By SPRINGSTED Incorporated
Semi-Annual
AnnuaI
08/01/93
02/01/94
710,000.00
710,000.00
710,000.00
Totals 710,000.00
Call Date ............. :
First Date Called ..... :
Call Premium .......... :
08/01/93
02/01/94
710,000.00 710,000.00
This portion will be paid with proceeds.
~olumbia Heights, Minnesota
TAY~LBLE G.O. Tax Increment Bonds of !987
Non-Refunded Debt Service
Schedule C
Prepared: 04/01/93
By SPRINGSTED Incorporated
Date Principal Rate Interest Semi-Annual Annual
08/01/93
02/01/94
32,065.00
32,065.00
32,065.00
Totals 32,065.00 32,065.00 32,065.00
This portion Will be paid by the issuer. The first payment includes interest on
the entire existing debt service.
Columbia Heights, Minnesota
G.O. Taxable Refunding Bonds,
Refunding Debt Service
Date Principal
02/01/94
08/0!/94
02/01/95
08/01/95
02/01/96
08/01/96
02/01/97
160,000.00
185,000.00
190,000.00
200,000.00
Series
Rate
4.000%
4.250%
4.750%
5.000%
!993A
Schedule D
Interest
!9,417.71
!3,443.75
13,443.75
9,512.50
9,512.50
5,000.00
5,000.00
Prepared:
By SPRINGSTED
Semi-Annual
179,417.71
13,443.75
198,443.75
9,512.50
199,512.50
5,000.00
205,000.00
04/Ol/93~
Incorporated
Annual
179,417.71
211,887.50
209,025.00
210,000.00
Totals
Bond Date.:
Avg. Mat..:
NIC ....... :
735,000.00
07/01/93
2.168
5.188%
75,330.21
810,330.21
Delivery..:
Discount.%:
Bond Yield:
810,330.21
07/21/93
1.00000%
4.72123%
~olumbia Heights, Minnesota
G.O. Taxable Refunding Bonds, Series 1993A
Annual Savings Analysis
Schedule E
Refunding Non-Refunded Total New
Date Debt Service Debt Service Debt Service
(1) (2) (3) (4)
08/01/93
02/01/94
08/01/94
02/01/95
08/01/95
02/01/96
08/01/96
02/01/97
179,417.71
211,887.50
209,025.00
210,000.00
32,065.00
211,482.71
211,887.50
209,025.00
210,000.00
Prepared: 04/01/93
By SPRINGSTED Incorporated
Existing Savings
Debt Service or (Loss)
(5) (6)
219,130.00
220,335.00
220,035.00
218,200.00
7,647.29
8,447.50
11,010.00
8,200.00
Totals
810,330.21
Present Value Rate...:
Present Vslue Ssvings:
As % of P.V. Ref. Int:
32,065.00
4.7212%
34,491.90
27.41%
842,395.21 877,700.00
Exc. Pro. to D/S Fund:
Acc. Int. to D/S Fund:
Total Net Savings .... :
35,304.79
67.00
1,849.32
37,221.11
Columbia Heights, Minnesota
G.O. Taxable Refunding Bonds, Series !993A
Escrow Structure
ScheduLe F
Prepared:
By SPRINGSTED
0~/0~/93{
Incorporated
This page has been left blank intentionally to show that an escrow account is
not required for a current refunding.
~olumbia Heights, Minnesota
G.O. Taxable Refunding Bonds, Series 1993A
Sources and Uses of Funds
Schedule G
Prepared: 04/01/93
By SPRINGSTED Incorporated
Sources of Funds:
Par Value of Refunding Bonds .................................... :
Less Discount / Plus Premium .................................... :
Accrued Interest ................................................ :
Earnings on Proceeds at: 2.750% .............................. ~
Funds From Issuer ............................................... :
Total Sources of Funds
735,000.00
(7,350.00)
1,849.32
542.00
730,041.32
Uses of Funds:
Refunded Debt Service and Call Premium if any ................... :
Open Market Security ............................................ :
Beginning Balance in Escrow ..................................... :
Accrued Interest to Sinking Fund ................................ :
Unused Discount to Sinking Fund ................................. :
Refunding Expenses .............................................. :
Excess Proceeds ................................................. :
Total Uses of Funds
710,000.00
1,849.32
18,125.00
67.00
730,041.32
CITY OF COLUMBIA HEIGHTS
Public Works Department
TO:
FROM:
SUBJECT:
DATE:
MAYOR AND CITY COUNCIL
PATRICK HENTGES, CITY MANAGER
MARK A. WlNSON /vt//rO
PUBLIC WORKS DIRECTOR/CITY ENGINEER
CAPITAL IMPROVEMENT PLAN
APRIL 29,1993
Attached are four short reports on the water, sanitary sewer, storm sewer and street systems
maintained by the City. Each report attempts to del'me the system's current condition, list
recommended improvements and discuss how these improvements would or could be funded.
I have not commented on alley or park improvements at this time, as the four critical systems
should be addressed first.
The intent of these reports is to present the Council with some basic information in order to
solicit their questions and comments. The ultimate goal is to receive direction from the Council
towards completing an ongoing five-year Capital Improvement Plan.
For the most part, the estimated costs presented in these reports are conservative, educated
guesses as extensive preliminary design is not warranted until the contents of a five-year plan are
more closely defined.
The two most critical systems are water and streets as these systems require the most
improvements. If the City wishes to look at obtaining its own water supply, necessary studies
should be started soon. Many of the streets are nearing the point in their life at which an overlay
will no longer be cost effective.
I will be available for any work session to discuss the attached reports with the Council.
MAW:jb
93-243
Attachment
SANITARY SEWER
General '-
The City's sanitary sewer system transports sewage from throughout the City and the City of
Hilltop. All sewage is directed to 44th Avenue and Main Street where the lines discharge to the
MWCC Interceptor for processing at the Metro Plant. In 1992, approximately 452 million
gallons of sewage was collected by this system.
Sewer Main
The City has 60 miles of sanitary sewer main. A majority of these mains are vitrified clay pipe
that are in excess of 40 years old. Properly maintained, these lines will have a useful life of 75-
100 years.
Generally the sewer mains are in good shape. The major problems are related to either root
intrusion or the build-up of sand or debris in certain lines. The Public Works Utilities
Department has adopted a systematic procedure of televising, rodding (cleaning), root cuffing and
vacuuming lines. In the past, a process called Sanafoam was used to clear the lines of roots.
With the addition of the Vactor equipment and the determination of the worst root areas, the use
of this somewhat hazardous chemical process has been decreased and may ultimately be ceased.
The systematic televising of all lines allow the crew to detect and record the locations of cracked
pipe, missing sections and mis-alignment. Cracked sections are rechecked periodically to
determine if the condition is worsening to point of needing repair. Sections exhibiting damaged
pipe or serious mis-alignment are scheduled for repair or replacement based on the severity of
condition, opportunity (i.e., street reconstruction) and budget.
Recent studies have indicated that overall, the system does not have excessive irff'fltration and in
flow. Public Works has developed a program of replacing the old style manhole covers that have
pick holes allowing water inflow with solid covers in those locations where the manhole becomes
inundated during rainfalls.
Public Works also has a program of identifying and repairing manholes that are in need of tuck
pointing and patching.
Lift Stations
The sanitary sewer system utilizes four lift stations to facilitate collections from areas that cannot
directly gravity feed. These lift stations are:
Silver Lake - located at the Silver Lake Boat Landing
Argonne - Argonne Drive west of Stinson
Chatham - Chatham Road near Golf Place
Sullivan Lake - located in Sullivan Park
Sanitary Sewer
Page 2
All lift stations have automatic controls and dual pumps that are cycled to prolong life and
provide redundancy in case one pump falls. The stations have on-site failure indicator lights and
are connected to a master control panel at the Municipal Service Center which has an auto dialer
to alert personnel of problems.
Recommended Improvements
As previously stated, overall the collection system is in good shape but as it ages, more and more
maintenance will be needed. The ongoing programs of cleaning, televising and root control in
the mains should be continued. These items are currently part of the maintenance budget. The
manhole repairs and repair or replacement of damaged mains should be in the sewer construction
fund and an annual budget of $60,000 should be maintained for these items. A majority of this
work is currently being done by Public Works crews, but there are occasions where this work
will need to be contracted out.
Whenever there is a street reconstruction project, the underlying sewer should be televised to
determine if it is appropriate to replace it at that time. Costs of the replacement of the sanitary
sewer system should come out of the Sewer Construction Fund.
There are two sections of sankary sewer main that experience recurring problems:
Fillmore Street north of.45th Avenue
Due to fiat service lines from several duplex units in to this line, any partial .blockage
results in an immediate backup into the homes. The installation of back flow preventers
in the vulnerable service lines would greatly reduce the potential of a damaging backup.
As the services are the responsibility of the property owners, the City should encourage
the owners to have the back flow preventers installed or the City could install the devices
to reduce the liability of claims. The estimated cost to install these devices in six duplex
units is $15,000.
43rd Avenue at Van Buren
Due to a flattening of the grade, this sewer main tends to surcharge and has caused
backups into several homes. A by-pass is in place, that in extreme events, will discharge
sewage into Jackson Pond. The MPCA is aware of this situation, but currently is not
pressing the City to correct it as it is a rare occurrence. At some time, this by-pass will
have to be eliminated. The backups occur only during heavy rainfalls and are due to the
numerous connection of downspouts and sump pumps to the sewer system upstream.
These connections were allowed and very common in the past. They are generally
Sanitary Sewer
Page 3
discouraged now as it results in the City paying for the ~:eatment of essentially clean
water. Back flow preventers have been installed in some of the homes experiencing
flooding, but this only tends, in this case, to move the backup problem upstream. The
real solution is to enact ordinances preventing the clean water connections and providing
incentives/dis-incentives to encourage the elimination of existing connections. The
existing connections can be located through sewer line televising and building inspections.
Three of the lift stations have been updated in the last three years. The pumps at the
Sullivan Lake Lift Station should be evaluated and scheduled for replacement. The
estimated cost is $80,000.
There are two future improvements that should be considered. The large diameter main in 2nd
Street from 38th Ave. to 45th Ave. and in 45th Ave. from 2nd Street to Main cannot be
adequately cleaned with the City's equipment. At some point, the build up of sand in this main
will need to be removed to maintain proper capacity. The estimated cost to clean this main using
special equipment is $50,000.
Although the existing telemetry system, that provides warning of problems, at the lift stations is
currently adequate, the need to provide more control and early diagnosis of problem conditions
will require an upgrade to the system. For estimating purposes, a figure of $50,000 should be
used at this time.
Funding
Improvements and replacements to the sanitary and storm sewer systems are currently funded
from the Sewer Construction Fund which has a balance in excess of $2.1 million. The above
listed sanitary sewer improvements have a relatively small cost compared to the available
balances and, therefore, the balance would appear sufficient if storm water improvements are
funded from a different source. If replacement of problem sanitary sewer lines, as part of street
reconstruction project, are paid for from this fund, additional funds would be needed depending
on the timing of street reconstructions.
STORM SEWER
General
A recently completed study on the City's storm sewer system was prepared by BRW, Inc. and
Ban' Engineering Company. The study analyzes the existing system and presents various
recommended improvements.
The City storm sewer system consists of approximately 35 miles of pipe. Eight lakes and ponds
are a part of this system and provide for some detention and sediment and phosphorus removal.
Physically, the storm sewer mains are in good condition, most of the lines are concrete pipe.
Public Works crews routinely televise and clear the lines of sand buildup. Catch basin cleaning
is done on a regular basis and repairs are made as necessary.
Recommended Improvements
The BRW/Barr study discusses several problem areas in the system. There are three small
watersheds in the southern portion of the City that discharge to the City of Minneapolis storm
sewer system. The storm sewers in these watersheds are undersized based on the analysis, but
improvements to their capacity in Columbia Heights will not correct the situation unless the
downstream lines in Minneapolis are also improved. The study recommends no changes unless
extensive flooding problems are experienced. Some minor flooding has been experienced in the
area of Jackson and Van Buren, north of 39th Avenue. This flooding could possibly be reduced
by constructing a detention basin in the vicinity of Huset Park. An estimate of the cost for this
improvement is $75,000.
The study indicates that potential flooding in the area between 38th and 39th Avenues from 2nd
Street to California Street could be alleviated by the addition of catch basins or increasing the
lateral line size. As serious problems have not been experienced in this area, no improvements
are proposed at this time.
The Rice Creek Watershed District is recommending some minor improvements to an existing
detention pond located at the Silver Lake Boat Landing. The proposed improvements would
increase the capacity of the pond to remove sediment and phosphorus. The estimate for this
improvement is $5,000.
Currently, design is underway for improvements being jointly funded by the cities of Columbia
Heights and Fridley along their common border. These improvements, expected to be
constructed in the Fall of 1993, will provide an ouffall for the Highland Lake-Secondary Pond-
Tertiary Pond system which has- no outlet. This will alleviate the potential of flooding for homes
on the Secondary and Tertiary Ponds. Additionally the improvements :will also alleviate flooding
of existing homes along 52nd Avenue. The Columbia Heights share is budgeted at $100,000.
Storm Sewer
Page 2
In this same area, the City currently is scheduled to make repairs to two discharge lines. The
line from Innsbruck Parkway to the Secondary Pond is estimated at $21,000 and the line from
Argonne drive to the Tertiary Pond is estimated at $31,000.
The largest watershed in the City, the LaBelle Pond-Jackson Pond system, is in need of several
improvements. Currently scheduled for 1993, repair of the inlet and outlet pipes at Jackson
Pond is estimated at $57,000. Staff is currently preparing a request for proposal to design
improvements at LaBelle Pond to improve the water quality. This project has a budget of
$165,000.
The largest storm water system improvement that is recommended is a solution to the surcharging
problem that is being experienced in the system in the area of 45th Avenue and Main St. The
BRW/Barr study, recommends that feasibility of a large, dry detention pond be investigated to
reduce the surcharge in this main outlet of the City system. For estimating purposes, a figure
of $250,000 should be used.
At Jackson Pond, there is a reverse well that was used in the past as an outlet for the pond. It
is no longer needed due to improvements to the main outer. In order to eliminate the potential
for contamination to underlying aquifers and any liability, this well should be capped and
abandoned. The cost for this item is estimated at $5,000.
Whenever a street is to be reconstructed, the underlying storm sewer and catch basins should be
reviewed to determine if repair or replacement is appropriate. Whether the cost of the storm
sewer improvements is borne by assessments or by the City should be decided by the Council.
Generally, it is difficult to prove benefit on storm sewer systems, so this cost may ultimately
have to be paid by the City.
Funding
There is some concern regarding the legality of the City's using the Sanitary Sewer Fund for
storm water system improvements. One potential funding source is the creation of a Storm Water
Utility which has been used by many municipalities in the area. Essentially, a runoff coefficient
is assigned, using accepted engineering standards, to each type of property. After annual needed
revenue is established, it is spread across all properties based on the area and runoff coefficient.
Although staff has not done any extensive research on the issue, a rough calculation shows that
an annual fee of $10, paid in quarterly utility bills of $2.50, for the typical residential property,
would generate $100,000 to $150,000 a year with commercial and industrial properties paying
a higher per square foot rate.
Storm Sewer
Page 3
As there are relatively few system improvements needed to be made, this low annual fee would
generate sufficient funding for the recommended improvements, annual maintenance and provide
a base to fund any replacement or repair needed in conjunction with street reconstruction. The
fund could be seeded, if legal, with a small transfer from the Sanitary Sewer Fund.
WATER SYSTEM
General
The City purchases water from Minneapolis for resale. In 1992, approximately 550 million
gallons were purchased. A study of the system was completed in 1989 by Bonestroo, Rosene,
Andeflik & Associates (BRAA) which identified various improvements needed to the system.
Several of these improvements have already been completed.
Distribution System
The City's distribution system consists of approximately 67 miles of cast iron and ductile iron
pipe, most of which was installed over 40 years ago. A majority of the mains are 6" in size.
The system is split into two pressure zones, with the divide running generally down Central
Avenue. The low pressure zone, west of Central Avenue, is gravity fed through a 24" line from
the Minneapolis reservoir in New Brighton. The high pressure zone is served by two pumping
stations that are alternated. Pressure is maintained by the 250,000 gallon elevated storage tank
on Stinson Boulevard.
The BRAA study identified several areas that experience Iow pressure. The study indicates that
these low pressure problems are the result of either dead end lines or loss of capacity due to
tuberculation. Tuberculation is the build up of corroded material on the inside of the line due
to failure of the enamel lining that was prevalent in water mains installed before 1950. This
condition narrows down the cross section of pipe and makes the interior rougher, both of which
reduce the carrying capacity of the line.
The areas that have been experiencing low pressure are:
Innsbruck Parkway, Innsbruck Parkway West - A water main replacement project in 1991
appears to have remedied this problem.
Valley View Elementary School area - A water main installation across central Avenue
at 49th Avenue has increased flows to this area.
Northwest comer of the City - Fire flows in this area are near the minimum required.
The study recommends the main in the University Service Road from 50th to 53rd be
evaluated and, if needed, cleaned and relined at an estimated cost of $80,000.
Southwest comer - Fire flows in this area are near the required minimums. The expected
near future closing of a major industrial user in this area will probably return pressure in
this area to an acceptablb level. Future uses in this area may :require m-evaluation of the
system.
Royce Street/Leander Lane - Low pressure in this are can be corrected by completing a
loop from Leander Lane and 40th to Royce Street and 40th. The estimated cost of this
project, if not done in conjunction with a street reconstruction project, is $80,000.
Water System
Page 2
Jefferson Divide - This area experiences some very low pressures during high demand
periods, low available fire flow and low pressure due to elevation low static pressure.
The study recommends five looping projects to provide adequate fire flow and installation
of individual pressure boosters. The looping projects, if not done in conjunction with
street reconstruction, are estimated at $215,000. The cost of installation of individual
pressure boosters is dependent on the exact number of homes that are experiencing less
than adequate pressure. For 12 homes, the cost is estimated at $26,000.
Ulysses Street - This area was not identified in the study. Residents in this area have
often complained of rusty water, probably due to corrosion in the line. The estimated
cost to clean and reline the main serving this area is $40,000.
Booster Pumps
Currently, a project is in progress to replace the pumps at Station #2, located at 44th Ave. and
Reservoir Blvd. With this replacement, the City would not need to consider replacement of
pumps at Station #3 for approximately 5 years.
Storage Tower
At this time the 250,000 gallon elevated storage tank is being inspected. The interior of the tank
was last painted 10 years ago. Based on the results of the inspection, the interior may need
repair in 1994 although a cost cannot be estimated until the inspection is completed.
Pressure Reducing Valves
The system has two sets of pressure reducing valves to protect the system from excessive
pressure. Neither set have been used during normal operation. The valves located near Station
#3 are very corroded and potentially could fail. The valve either needs to be replaced or
removed from service. The estimate to correct this problem is $40,000.
Master Meter
All water entering the City passes through one 24" compound meter. This meter was recently
taken out of service due to wear. Although this type of meter has not been produced in a number
of years, we were able to find parts in California and have the repair done. Due to the age and
type of meter, more frequent repairs will become necessary and the accuracy is questionable.
It is anticipated that when the contract for water purchases comes due, the City of Minneapolis
may want this meter replaced. The estimate to replace the master meter is $45,000.
Water System
Page 3
Telemetry
There is in place a telemetry system that controls the system and warns of various failure modes.
The system is adequate, but future needs to better control the system and diagnose potential
problems will require upgrading or replacing this system in conjunction with the sanitary sewer
system. Estimated cost is $50,000.
Lead/Copper
Recent Federal legislation has required all water systems to test for lead and copper in drinking
water. Due to the softness of the water purchased from Minneapolis, Columbia Heights did not
"pass the test". The water itself does not contain lead, and it is generally recognized that the lead
is leaching out of fixtures and lead service lines. There are approximately 75 homes in the City
which may still have lead service lines. Under the current regulations the City may have a
liability to replace these services. If this is necessary, it would not be required until 1997 or
later. An estimate of the cost to replace these services is $100,000.
Watermain Replacement
Any time a street is reconstructed, the underlying watermain should be evaluated through flow
testing to determine if the capacity has been decreased due to corrosion or undetected leakage.
Water Supply,
The price Columbia Heights pay for water is directly tied to the rates Minneapolis charges its
residential customers. Indications are that Minneapolis will be raising its rates approximately 8%
per year for the foreseeable future to fund replacement of all water meter and portions of their
system. Currently the City pays approximately $0.97 per hundred cubic feet or $1.30 per 1,000
gallons. For comparison, Fridiey charges its residents $0.60 per 1,000 gallons. As the City's
contract with Minneapolis expires in 1995, it may be prudent to look at providing our own
supply. A 1956 study indicated that, at that time, the City could save significant money by
installing their own wells and treatment. This analysis would have to be done as there have been
significant changes in costs since this time. At the time of the study, the City was paying $0.215
per hundred cubic feet. Items to be considered now are availability of a dependable clean water
source, availability of land for well fields and treatment facilities, whether softening should be
done which adds significantly to the cost and the cost effectiveness of such a system based on
current costs.
Water System
Page 4
A rough analysis of the City's needs indicates that, at a minimum, three 1,000 gpm wells, 2
million gallons of storage and a 1,500 gpm treatment plant with iron and perhaps softening would
be required. A study to determine the feasibility of constructing an independent system is
estimated at $15,000. Construction cost of the system is unknown but would be in the range of
$8-12 million.
Funding
Currently, improvements to the water system are paid for out of the Water Construction Fund
which has a balance of just over $500,000. The cash balance in the water operating fund could
potentially add another $200,000 to this fund. A review of the above recommended
improvements indicates that if all improvements were undertaken the fund would be depleted,
leaving no funding available for watermain replacement in conjunction with street reconstruction
projects. It is recommended that the Water Construction Fund be increased, over time, to a
balance similar to the $2 millio.n in the Sanitary Sewer Fund. If the City decides to implement
its own water supply, the funding would have to be from a bond issue with the bond repayment
built into the water rates.
STREETS
General
The City has approximately 79 miles of streets, including the streets that bound the City.
Approximately 5 miles of the streets are concrete which were constructed in the early 60's. A
majority of the asphalt streets were built in the 40's, 50's and early 60's and have received no
maintenance other than patching, crackfilling and sealcoating.
The Engineering Department utilizes a program called PMI to catalog the condition of the streets
and predict and schedule the need for various maintenance operafiong. The model used by PMI
is as follows:
A properly constructed asphalt street will have a useful life of 20-30 years without any
maintenance other than pothole patching and cracksealing. Useful life is measured by
ride quality.
B. The useful life can be extended to 50 years by overlaying the street every 10 years.
A systematic program of patching, crackf'flling and surface treatments such as sealcoats
or seals can extend the time between overlays to 20 years and provide potentially 100
years of service before reconstruction is needed.
In order to keep the inventory up-to-date, engineering staff annually surveys every street and rates
the surface texture, surface condition, ride quality and effectiveness of the drainage (curb and
gutter). One of the items in the database is whether or not the structure of the pavement is
sufficient to support current traffic conditions. This is determined by either reviewing the actual
records of the pavement thickness or by a visual determination based on the surface condition
related to excessive cracking, potholes or other forms of distress such as rutting.
Utilizing the information in the database, a determination can be made of the overall condition
of the streets.
Ride Quality
Poor 21%
Fair 38%
Good/Excellent 41%
Surface Condition
Poor 45%
Fair 41%
Good/Excellent 14%
Streets
Page 2
Asphalt Streets
Approximately 20% of the streets do not appear to have sufficient strength to support traffic
conditions. This due to either insufficient pavement thickness when built or the deterioration of
the structural components (subgrade, base, pavement) due to age or inadequate drainage. These
street segments would probably not benefit from an overlay and need to be reconstructed. The
attached sheet entitled "Street Reconstruction" lists the street segments that appear to need
reconstruction.
The PMI program predicts, based on pavement thickness, class of street, age, ride quality and
surface condition, when a street is in need of an overlay to maintain strength and ride quality.
The attached listing of overlays includes the street segments that the program predicts would
benefit from overlays between now and 1997. :
The street reconstruction listing is broken into two sections in an attempt to prioritize the need
by ride quality and surface condition. The $25/square yard cost used includes replacement of the
base, pavement surface, curbing and approximately 20% for engineering, inspection and
assessment administration. This cost equates to approximately $90 per lineal foot or $45 per
front foot.
The overlay listing is also broken into two sections based on actual year predicted by the
program. The $7.60/square yard cost is based on a 1.75 inch overlay, milling of the existing
pavement to maintain the cross slope and drainage, some curb and gutter replacement and
approximately 15% for engineering, inspection and assessment administration. This equates to
$27 per foot or $13.50 per front foot.
Recommendation
In order to preserve those streets whose life can be effectively prolonged by an overlay, a
program should be implemented to overlay the streets on the attached list over the next five
years. Thereafter, the PMI program should be followed for furore overlays. Between overlays,
routine patching and crack sealing should be done and the street sealcoated every 6-8 years.
Based on this schedule, with the City picking up patching and crack sealing costs, and current
prices, the average cost per year to the resident over twenty years would be approximately $20
per front foot or $100 per year for a 50' lot under the City's current assessment policy.
The backlog of streets that appears to need reconstruction can be handled with two different
approaches. The streets could continue to receive routine maintenance and sealcoafing and be
reconstructed at the time that the ride quality deterioration to the point that the adjacent property
owners are willing to accept the cost of reconstruction. The other approach is to prioritize the
streets and embark on a ten-year program of reconstruction using either forced assessments and/or
other potentially available funding sources.
Streets
Page 3
The City should continue its current program of patching and seal cracking and a systematic
sealcoating program. Public Works will be evaluating its current crack sealing program this year
to determine its effectiveness and whether an expanded or different program would be beneficial.
The City's concrete streets are joint sealed and sections replaced on an as-needed basis. Properly
maintained concrete pavements have expected useful lives in excess of 50 years, indicating that
reconstruction is probably 15-20 years away.
Funding
Current City policy is to assess property owners the total cost of sealcoats, overlays and
reconstruction. State Aid streets are not assessed as State Aid funds are used. Them are virtually
no funds available other than the General Fund for the replacement or overlaying of the streets.
Recent court cases will make it more difficult to prove sufficient benefit to property values in
the case of forced assessments. This leaves the timing of street improvements to the whim of
the affected property owners who would have to petition for the improvement and waive their
right to a hearing. In the mean time, there is increased pressure on the City to escalate patching
on streets whose overall structure is quickly falling apart. This "band-aid" type approach is
ultimately less cost effective than a systematic program of pavement maintenance.
There are several alternatives to this current situation. The City could establish a Street Fund
using General Fund or bond money and use these funds to pay a percentage of all overlays and
reconstructions. This would make the assessments more acceptable. The City could also
consider assessing all or a portion of improvements to State Aid streets as allowed by current
State Aid rules and use these funds to offset costs on non-State Aid streets.
Another potential funding source is the establishment of a Transportation Utility. This would be
an annual fee charged to all property owners based on street system usage by type of property,
similar to the Storm Water Utility. Enabling legislation for a Transportation Utility is being
considered by the State Legislature this session.
The City may wish to adopt a strategy that recently was successfully implemented by the Village
of St. Anthony. A taskforce of interested citizens was formed to review the condition of the
street system and evaluate various funding schemes. The taskforce was educated by staff and
outside consultants on the current condition of the streets, pavement structure and maintenance
and the availability of various funding sources. This taskforce recently presented a
recommendation to the St. Anthony Council on the type and priority of street improvements,
establishment of a Storm Water Utility and changes in the assessment policy. This type of
approach may lend public support and credence to the decisions of the City Council on these
issues.
28-Apr-93
STREET RECONSTRUCTION
EST. COST (S.Y.) $25.00
STREET FROM
2ND ST
2ND ST
2-1/2 ST
2-1/2 ST
3RD ST
4TH ST
5TH ST
5TH ST
6TH ST
7TH ST
7TH ST
38TH AVE
39TH AVE
45TH AVE
45TH AVE
45TH AVE
48TH AVE
50TH AVE
50TH AVE
50TH AVE
51 ST AVE
52ND AVE
BENJAMIN
BUCHANAN
CLEVELAND
EDGEMOOR
GOULD
JACKSON
JACKSON
LINCOLN
MADISON
MADISON
MCKINLEY
MCKINLEY
MCLEOD
MCLEOD
MILL ST
MONROE
MONROE
POLK
QUINCY
QUINCY
ULYSSES St
UNIV. SERV. RD
TO AREA
(S.Y.)
37TH AVE 40TH AVE 6365
43RD AVE 45TH AVE 4107
37TH AVE 3RD ST 4691
44TH AVE 45TH AVE 2127
38TH AVE 40TH AVE 4918
40TH AVE 41 ST AVE 2053
44TH AVE 45TH AVE 2273
51ST AVE 52ND AVE 2490
42ND AVE 45TH AVE 5940
40TH AVE 43RD AVE 6600
45TH AVE 51 ST AVE 12655
CALIFORNIA MAIN 917
BUCHANAN JOHNSON 1917
5TH ST 7TH ST 2442
MADISON MONROE 1217
VAN BUREN CENTRAL 1217
JEFFERSON MONROE 21 40
UNIVERSITY 5TH ST 2220
6TH ST 7TH ST 1073
JEFFERSON MONROE 2183
4TH ST 6TH ST 2146
6TH ST '7TH ST 1073
40TH AVE CBS 1015
37TH AVE 39TH AVE 3190
40TH AVE 41 ST AVE 2078
2-1/2 ST 3RD ST 1363
CENTRAL RESERVOIR 4546
37TH AVE 39TH AVE 3287
44TH AVE 45TH AVE 2053
37TH AVE CDS 2207
37TH AVE 38TH AVE 2130
48TH AVE 49TH AVE 2114
37TH AVE 39TH AVE 2493
39-1/2 AVE 40TH AVE 886
ROYCE 43RD AVE 2194
44TH AVE 45TH AVE 2097
5TH ST 40TH AVE 5525
40TH AVE 45TH AVE 10045
47-1/2 AVE 48TH AVE 1203
37TH AVE 41 ST AVE 11014
39TH AVE ? 42ND AVE 6190
44TH AVE 45TH AVE 1980
JOH~ISON ODS 1933
37TH AVE 40TH AVE 5264
COST
$159,125
$1 O2,675
$117,275
$53,175
$122,950
$51,325
$56,825
$62,250
$148,500
$165,000
$316,375
$22,925
$47,925
$61,050
$30,425
$30,425
$53,5OO
$55,500
$26,825
$54,575
$53,65O
$26,825
$25,375
$79,750
$51,95O
$34,O75
$113,650
$82,175
$51,325
$55,175
$53,250
$52,85O
$62,325
$22,150
$54,85O
$52,425
$138,125
$251,125
$3O, O75
$275,35O
$154,750
$49,500
$48,325
$131,600
STATE AID
28-Apr-93
STREET RECONSTRUCTION, CONT'D
VAN BUREN 44TH AVE
WASHINGTON 40TH AVE
45TH AVE
46TH AVE
47TH AVE
E. UPLAND CREST
FOREST
HEIGHTS DR
HIGHLAND PL
PIERCE ST
PIERCE ST
UPLAND CREST
BUCHANAN
TAYLOR
FILLMORE
FAIRWAY
W. UPLAND
GOLF
W. UPLAND
37TH AVE
46TH AVE
HEIGHTS
45TH AVE
42ND AVE
MCLEOD
FILLMORE
JOHNSON
N. UPLAND
E. UPLAND
FAIRWAY
E. UPLAND
CDS
47TH AVE
FAIRWAY
2127
4106
1341
1050
3766
2916
2465
285O
2458
1563
2127
393O
$53,175
$102,650
SUBTOTAL
$33,525
$26,25O
$94,150
$72,900
$61,625
$71,25O
$61,45O
$39,075
$53,175
$98,250
SUBTOTAL
TOTAL
$3,845,100
$611,650
$4,456,750
STREET OVERLAYS
STREET FROM
4TH ST
4TH ST
5TH ST
5TH ST
6TH ST
6TH ST
7TH ST
7TH ST
38TH AVE
38TH AVE
39TH AVE
39TH AVE
41 ST AVE
42ND AVE
42ND AVE
43RD AVE
43RD AVE
43-1/2 AVE
45TH AVE
45TH AVE
45TH AVE
46TH AVE
46-1/2 AVE
47TH AVE
47TH AVE
47-1/2 AVE
50TH AVE
50TH AVE
50TH AVE
50-1/2
51 ST AVE
52ND AVE
ARTHUR
CALIFORNIA
BENJAMIN
CLEVELAND
HART BLVD
HAYES
JACKSON
JACKSON
JACKSON
LOOKOUT
MADISON
MADISON
41 ST AVE
45TH AVE
45TH AVE
52ND AVE
40TH AVE
45TH AVE
43RD AVE
51 ST AVE
MADISON PL
DEAD END
5TH ST
TYLER
END
2ND ST
RESERVOIR
6TH ST
MADISON
TYLER PL
MAIN
FFH ST
MONROE
UNIVERSITY
JEFFERSON
UNIVERSITY
5TH ST
JEFFERSON
5TH ST
7TH ST
MONROE
MONROE
6TH ST
UNIVERSITY
39TH AVE
39TH AVE
43RD AVE
41 ST AVE
37TH AVE
39TH AVE
39TH AVE
SO. OF 42ND
49TH AVE
40TH AVE
40TH/~VE
42ND AVE
EST. COST (S.Y.) $7.60
TO AREA
(S.Y.)
44TH AVE 6159
53RD AVE 16963
51ST AVE 13086
53RD AVE 2123
42ND AVE 17046
53RD AVE 16301
45TH AVE 4400
53RD AVE 3811
SHOP 920
QUINCY 653
JEFFERSON 6410
POLK 1511
RESERVOIR 822
3RD ST 2028
TYLER 1579
JEFFERSON 3065
QUINCY 2140
PEIRCE 3722
5TH ST 6482
MAIDSON 3651
VAN BUREN 3725
7TH ST 37O0
MONROE 1773
4TH ST 666
6TH ST 666
MONROE 2143
6TH ST 999
JEFFERSON 2146
CENTRAL 3973
JACKSON 2684
WASHINGTON 2475
6TH ST 3219
43RD AVE 11484
CDS 1080
45TH AVE 4195
42ND AVE 2101
39TH AVE 6924
40TH AVE 3242
40TH AVE 2955
43RD AVE 2893
51 ST AVE 6O77
5TH ST 3825
41 ST AVE 2053
45TH AVE 6159
COST
$46 808
$128 919
$99 454
$16 135
$129 550
$1 23 888
$33 440
$28 964
$6 992
$4 963
$48 716
$11,484
$6,247
$15,413
$12,000
$23,294
$16,264
$28,287
$49,263
$27,748
$28,310
$28,120
$13,475
$5,062
$5,062
$16,287
$7,592
$16,310
$30,195
$20,398
$18,810
$24,464
$87,278
$8,208
$31,882
$15,968
$52,622
$24,639
$22,458
$21,987
$46,185
$29,O7O
$15,603
$46,808
MSAS 93/94
STREET OVERLAYS, CONT'D
MADISON 49TH AVE
MCKINLEY 39TH AVE
MONROE 48TH AVE
PETERS PL GOULD
QUINCY 37TH AVE
QUINCY 42ND AVE
RESERVOIR 37TH AVE
STINSON FAIRWAY
SULLIVAN 7TH ST
UNIV. SERV. RD. 40TH AVE
UNIV. SERV. RD. 45TH AVE
UNIV. SERV. RD. 48TH AVE
UNIV. SERV. RD. 50TH AVE
UNIV. SERV. RD. 51ST AVE
VAN BUREN 37TH AVE
VAN BUREN 42ND AVE
WASHINGTON 42ND AVE
WASHINGTON 45TH AVE
WASHINGTON 48TH AVE
5TH ST 37TH AVE
37TH AVE MAIN
38TH AVE MAIN
39TH AVE JOHNSON
53RD AVE UNIVERSITY
FILLMORE 47TH AVE
HAYES 40TH AVE
MCLEOD 43RD AVE
51 ST AVE
39-1/2
51 ST AVE
RESERVOIR
39TH AVE
43RD AVE
40TH AVE
5TH ST NW
WASHINGTON
44TH AVE
47TH AVE
49TH AVE
51 ST AVE
53RD AVE
41 ST AVE
43RD AVE
44TH AVE
46TH AVE
51 ST AVE
40TH AVE
CENTRAL
3RD ST
ARTHUR
WASHINGTON
49TH AVE
41 ST AVE
44TH AVE
4246
2517
6874
2749
3287
1980
12766
2025
902
704O
3549
2065
1760
1760
8037
2127
4106
2140
6311
10081
210O6
4551
4100
6627
3745
2065
2127
$32,270
$19,129
$52,242
$20,892
$24,981
$15,048
$97,022
$15,390
$6,855
$53,504
$26,972
$15,694
$13,376
$13,376
$61,081
$16,165
$31,206
$16,264
$47,964
SUBTOTAL
$76,616
$159,646
$34,588
$31,160
$5O,365
$28,462
$15,846
$16,165
SUBTOTAL
TOTAL
$2,054,052
$412,847
$2,466,899
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