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HomeMy WebLinkAboutOctober 23, 2000 RegularCITY OF COLUMBIA HEIGHTS 590 40TH AVENUE N.E., COLUMBIA HEIGHTS, MN 55421-3878 (612) 782-2800 TDD 782-2806 Please note. City Hall Phone Numbers have changed. New numbers are: Main Number (763) 706-3600, TDD (763) 706-3692 ADMINISTRATION October 20, 2000 Councilmembers DonaM G. Jolly Marlaine Szurek Julienne Wyckoff City Manager Walter R. Fehst The following is the agenda for the regular meeting of the City Council to be held at 7:00 PM on Monday, October 23, 2000 in the City Council Chambers, City Hall, 590 40th Avenue N.E., Columbia Heights, Minnesota. 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 disabled persons are available upon re- quest when the request is made at least 96 hours in advance. Please call the Deputy City Clerk at 763-706-361 I, to make arrangements. (TDD/706-3692 for deaf or hearing impaired only) 1. CALL TO ORDER/ROLL CALL 2. 3. o PLEDGE OF ALLEGIANCE ADDITIONS/DELETIONS TO MEETING AGENDA (The Council, upon majority vote of its members, may make additions and deletions to the agenda. These may be items brought to the attention of the Council under the Citizen Forum or items submitted after the agenda preparation deadline.) CONSENT AGENDA (These items are considered to be routine by the City Council and will be enacted as part of the Consent Agenda by one motion. Items removed from consent agenda approval will be taken up as next order of business.) MOTION: Move to approve Consent Agenda items as follows: 1) Minutes for Approval MOTION: Move to approve the minutes of the October 9, 2000, Regular Council Meeting as presented. MOTON: Move to approve the minutes of the October 16, 2000 Board/Commission Interviews as presented. 2) Establish Work Session and Budget Heating Dates MOTION: Move to establish a Work Session meeting date for Monday, October 30, 2000 at 7:00 p.m., and the Budget Heating meeting for Monday, November 6, 2000, at 6:00 p.m. 3) Adopt Resolution No. 2000-73, being a Resolution Amending Plan Documents for the Flexible Benefit Program. MOTION: Move to waive the reading of Resolution No. 2000-73, there being ample copies available to the public. MOTION: Move to adopt Resolution No. 2000-73, being a Resolution Adopting the Amended Plan Documents for the Columbia Heights Flexible Benefit Program. City Council Agenda October 23, 2000 Page 2 of 4 4) Adopt Resolution No. 2000-74 Being a Resolution Electing to Continue Participation in the Local Housing Incentives Account Program under the MetTopolitan Livable Communities Act for calendar year 2001. MOTION: Move to waive the reading of Resolution 2000-74, there being ample copies available to the public. MOTION: Move to adopt Resolution 2000-74, being a Resolution Electing to Continue Participation in the Local Housing Incentives Account Program under the Metropolitan Livable Communities Act for calendar year 2001. 5) Approve Indoor Gun Range Update MOTION: Move to approve the purchase and installation of a new bullet trap system and ventilation system from RRI Range Systems in the amount of $19,109 plus tax and approve electrical modifications needed to mn this system to be made by Aid Electric in the amount of $3,306 plus tax; funding to come from the 2000 Federal Equipment Block Grant Fund 276-42112 and Fund 863, Police Contributions Fund. 6) Authorize to solicit bids for sale of Fire GPM Pumper MOTION: Move to authorize the Fire Chief to solicit sealed bids for the sale of the 1967 Pirsch 1250 GPM Pumper 7) Approve Transfer of Funds to Fire Department Overtime Regular Fund Account MOTION: Move to transfer $1,750 from General Fund Account #101-00-34202 to the Fire Department Overtime Regular Account # 101-42200-1020. 8) Approve Re-Issue of Rental Housing License after Revocation at 500 40tt~ Avenue MOTION: Move to issue a Rental Housing License to A. C. Milan, LLC to operate the Rental Property located at 500 40th Avenue in that the provisions of the Residential Maintenance Code have been complied with. 9) Establish Heating Dates Re: License Revocation or Suspension of Rental Properties at 3732 3rd Street, 981 43 ½ Avenue, 1100-1102 39'h Avenue, and 4055-4057 University Ave MOTION: Move to establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Dale Frenzel at 3732 3rd Street NE. MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Mohammed Khan at 981 43 V~ Avenue NE. MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Steven Ef~erfeld at 1100-1102 39a~ Avenue NE. MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Kwei Fang at 4055-4057 University Avenue. City Council Agenda October 23, 2000 Page 3 of 4 10) Payment of Bills MOTION: Move to pay the bills as listed out of proper funds. 5. PROCLAMATIONS, PRESENTATIONS, RECOGNITIONS AND GUESTS A. Proclamgions Presentations 1. Antionette LaMere - acknowledgement for 6 ½ years of service on the Human Service Commission C. Introduction of New Employees Recognition 1. Commission Appointments a. Donna Kay Schmitt - 4260 Tyler Street MOTION: Move to appoint Donna Kay Schmitt, to fulfill a four-year term, ending April 1, 2003 to the Planning and Zoning Commission. Harold Netkow - 1160 49® Avenue NE MOTION: Move to appoint Harold Netkow, to fulfill a three-year term, ending April 1, 2003 to the Police and Fire Civil Service Commission. Roger Peterson 4113 Quincy Street NE MOTION: Move to appoint Roger Peterson, to fulfill a five-year term, ending April 1, 2002 to the Park and Recreation Commission. 6. PUBLIC HEARINGS Adopt Ordinance #1421, being an Ordinance Authorizing the Conveyance of Certain Real Estate located at 3855 Main Street NE MOTION: Move to waive the reading of Ordinance #1421, there being ample copies available to the public. MOTION: Move to adopt Ordinance #1421, being an Ordinance Amending Ordinance No. 853, City Code of 1977, Authorization to Convey Certain Real Estate located at 3855 Main Street NE. 7. ITEMS FOR CONSIDERATION A. Other Ordinances and Resolutions B. Bid Considerations C. Other Business 8. ADMINISTRATIVE REPORTS A. Report of the City Manager City Council Agenda October 23, 2000 Page 4 of 4 B. Report of the City Attorney 9. GENERAL COUNCIL COMMUNICATIONS Minutes of Boards and Commissions 1) 2) 3) 4) 5) 6) Meeting of the September 27, 2000 Park and Recreation Commission Meeting of the October 3, 2000 Library Board of Trustees Meeting of the October 3, 2000 Library Board of Trustees Budget Heating Meeting of the August 16, 2000 Economic Development Authority Meeting of the September 19, 2000 Economic Development Authority Meeting of the September 25, 2000 Economic Development Authority 10. CITIZENS FORUM (At this time, citizens have an opportunity to discuss with the Council items not on the regular agenda. The citizen is requested to limit their comments to five minutes. Please note, the public may address the Council regarding specific agenda items at the time the item is being discussed.) 11. ADJOURNMENT Walt Fehst City Manager WF/pm OFFICIAL PROCEEDINGS COLUMBIA HEIGHTS CITY COUNCIL REGULAR COUNCIL MEETING OCTOBER 9, 2000 The regular meeting of the City Council was called to order at 7:00 p.m. on Monday, October 9, 2000 in the City Council Chambers, City Hall, 590 40th Avenue N.E., Columbia Heights, Minnesota. CALL TO ORDER/ROLL CALL Present: Councilmember Szurek, Councilmember Jolly, Councilmember Wyckoff, Councilmember Hunter, and Mayor Peterson 2. PLEDGE OF ALLEGIANCE o ADDITIONS/DELETIONS TO MEETING AGENDA None 4. CONSENT AGENDA Motion by Wyckoff, second by Szurek, to approve Consent Agenda items as follows: 1. Minutes for Approval Motion to approve the minutes of the September 25, 2000, Regular Council Meeting as presented. Adopt Resolution No. 2000-69, being a Resolution for Certification of Delinquent Assessments Motion to waive the reading of Resolution No. 2000-69, there being ample copies available to the public. Motion to adopt Resolution No.2000-69, being a Resolution to certify delinquent assessments to Anoka County for collection with the Property Taxes payable in 2001. RESOLUTION NO. 2000 - 69 CERTIFICATION OF DELINQUENT ASSESSMENTS BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF THE CITY OF COLUMBIA HEIGHTS, that THE COUNTY AUDITOR be, and he is hereby directed, to levy the delinquent special assessments, delinquent utility, and miscellaneous abatement and delinquent bills on the properties in the City of Columbia Heights as submitted on the attached pages and filed in the Assessment Book for 2000 totaling $78,890.08. BE IT FURTHER RESOLVED that the foregoing amounts shall be included in the individual property tax statements for the current year and identified thereon as "Special Assessments - Fund #83079. SAID LEVIES shall be enforced and collected in the manner provided for the enforcement and collection of State and County taxes under and in accordance with the provisions of the general laws of the State. All assessments with penalties and interest as indicated thereon paid to the County Treasurer shall belong to the City of Columbia Heights and shall be turned over to the City Treasurer in the manner provided by the City Charter and Ordinances. City Council Minutes October 9, 2000 Page 2 of 11 THE CITY OF COLUMBIA HEIGHTS shall accept payments on these levies until October 4, 2000. Upon receipt of said payments the City will remove them from the certification list sent to Anoka County. Passed this 9th day of October 2000. Offered by: Wyckoff Seconded by: Szurek Roll Call: All ayes Mayor Gary L. Peterson Patricia Muscovitz, Deputy City Clerk 3) Approve Assignment and Assumption of Administration Function Agreement for Single Family Mortgage Revenue Refunding Bonds Motion to approve the Assignment and Assumption of Administration Function Agreement between Miller and Schroeder Financial, Inc. and Firstar Bank, N.A. for the Single Family Mortgage Loan Program issued by the City of Brooklyn Center, City of Columbia Heights, City of Moorhead, and Robbinsdale Economic Development Authority; and furthermore, to authorize the City Manager to enter into an agreement for the same. Fehst stated this is a conveyance to Firstar Bank for the administration of the single-.family mortgage loan program for these four joint cities. 4) Authorize payment of the 2001 League of Minnesota Cities Membership Dues Motion to authorize payment to the League of Minnesota Cities for 2001 membership dues in the amount of $10,288. 5) Authorize to proceed with 24" Gate Valve installation and Swing Check Valve removal at Pump Station #3. Motion to authorize GL Contracting to proceed with 24" gate valve installation and swing check valve removal at Pump Station #3, for the estimated cost of $16,000 with funds appropriated from 651-49430-5130. Fehst stated area is below the water tower off of Stinson Boulevard. 6) Authorize Preparation of Final Plans and Specifications for Central Avenue Streetscaping Motion to authorize preparation of Final Plans and Specifications for Central Avenue Streetscaping from 37th to 43rd Avenues as detailed in the attached proposal letter; and, authorize the Mayor and City Manager to enter into a contract for final urban design services to BRW at a cost not-to-exceed $27,000. Fehst estimated a cost of between $2.5 and $3 million for street, water and sewer replacement along Central Avenue. 7) Authorize preparation of Engineering Study for additional Storm Water Study Areas Motion to authorize preparation of an Engineering Study for each site as detailed in the attached proposal letters; and, authorize the Mayor and City Manager to enter into City Council Minutes October 9, 2000 Page 3 of 11 a contract for the same at a cost not-to-exceed $14,100. Funding would be provided from the City's Storm Water Utility Fund 604-49650-3050. Fehst stated the study areas would be along 40th and McKinley Street and on Van Buren Street. 8) Authorize Final Payment for 2000 Street and Parking Lane Striping Motion to accept the work for 2000 Street and Parking Lane Striping; and, to authorize payment of $5,299.76 to AAA Striping Service Company, of Rogers, Minnesota 9) Authorize Final Payment for Seal Coating, City Project 0001(B) Motion to accept the work for 2000 Seal Coating Program, City Project 0001(B); and, authorize final payment of $3,903.60 to Allied Blacktop Company of Maple Grove, Minnesota. 10) Approve Conditional Use Permit, Case #2000-1026, at 2261 37th Ave NE Motion to approve the Conditional Use Permit to allow the operation of a Christmas Tree Sales Lot at 2261 37th Avenue NE from November 15, 2000, through December 31, 2000, subject to the following conditions: a. A $500 deposit shall be submitted to the License/Permit Clerk prior to display of trees on the lot. b. The required City licenses be obtained prior to tree displays 11) Approve License Applications Motion to approve the items as listed on the business license agenda for October 9, 2000. 12) Payment of Bills Motion to pay the bills as listed out of proper funds. Upon vote: All ayes. Motion carried. 5. PROCLAMATIONS, PRESENTATIONS, RECOGNITIONS AND GUESTS Proclamations - None. Presentations 1. North Metro Mayor's Association a. Discussion and Overview of Legislative Issues for 2001 b. Identifying 2001 Activities of the North Metro Mayors Association Phil Cohen, representing the North Metro Mayors Association, spoke on issues to be discussed with local legislators prior to the General Election. Issues he discussed included tax reform, further reclassification of commercial and industrial property and the affect on TIF Districts, fiscal disparities, levy limits, and Board of Reviews for local zoning issues. C. Introduction of New Employees - None. D. Recognition - None. PUBLIC HEARINGS A. Adopt Resolution No. 2000-70, being a Resolution Approving a Tax Rate Increase for the Year 2001. City Council Minutes October 9, 2000 Page 4 of 11 Motion by Jolly, second by Szurek, to waive the reading of Resolution 2000-70, as adequate copies are available for the public. Upon vote: All ayes. Motion carried. Motion by Jolly, second by Szurek, to adopt Resolution No. 2000-70 being a Resolution Approving a Tax Rate Increase. Bill Elrite, Finance Director, stated that on September 1 j th the City Council adopted a proposed levy. Anoka County has determined this may result in a tax rate increase and this additional step is necessary in the levy process prior to the Truth in Taxation hearing in December. Mayor Peterson closed the Public Hearing. Upon vote: All ayes. Motion carried. B. First reading to Adopt Ordinance # 1421, being an Ordinance amending Ordinance No. 853, City Code of 1977, Authorization to Convey Certain Real Estate located at 3855 Main Street NE Motion by Szurek, second by Wyckoff, to waive the reading of Ordinance #1421, there being ample copies available to the public. All ayes. Motion carried. Motion by Szurek, second Wyckoff, to schedule Monday, October 23, 2000 at approximately 7:00 p.m. for the second reading of Ordinance #1421, being an Ordinance amending Ordinance No. 853, City Code of 1977, Authorization to Convey Certain Real Estate located at 3855 Main Street NE. Peterson opened the Public Hearing. royce Shellito, 403 Summit Street questioned the purchase price and sale price. Ken Anderson, Community Development Director, stated the home was purchased for $54,000 and $1,000 in closing costs. The site was selected because it was on scattered site housing list, and is a non- conforming structure. Property owners to the north and south have requested to purchase this lot. Brian Roeller, 3849 Main Street, stated he wishes to purchase the property as the current house sits only about one foot from his and his neighbor's lot line. Mayor Peterson closed the Public Hearing. Upon vote: All ayes. Motion Carried. Second reading to Adopt Ordinance #1420 being an Ordinance amending Ordinance No. 853, City Code of 1977, Authorization to Convey Certain Real Estate located at 4101 and 4103 Central Avenue NE and Approve Conflict of Interest Disclosure Statement Motion by Jolly, second by Szurek, to waive the reading of Ordinance #1420, there being ample copies available to the public. Upon vote: All ayes. Motion Carried. Motion by Jolly, second by Szurek, to approve Ordinance #1420, being an Ordinance amending Ordinance No. 853, City Code of 1977, and Authorization to Convey Certain Real Estate located at 4101 and 4103 Central Avenue NE, and authorizing the Mayor and City Manager to enter into a purchase agreement for same. Fehst stated this property holds the closed Norwest Bank building, which the City purchased from Families Moving Forward (FMF) in duly, for $360,000. A lease agreement of less than two years was signed, however, FMF has found and purchased another property in Minneapolis. The lease agreement has been terminated. Washburn-McReavy Funeral Chapels, Inc. has submitted an offer City Council Minutes October 9, 2000 Page 5 of 11 for $375, O000 for the property. The Purchase Agreement has been reviewed and approved by the law firm of Kennedy and Graven. On October 5th Fehst showed the building to Mr. Daniel Gonsior. On October 6th Gonsior faxed a letter stating he would not be able to attend the City Council meeting, but requested the City table the second reading of the Ordinance so he could submit an offer on the building. Fehst stated the building was vacant for five years. The only business that tried to purchase this building was a pawnshop, but the area was not zoned for this use. Others who expressed interest were a dry cleaner, and carpet sales. This is the second reading of the Ordinance, and if approved, will be followed by a 30-day waiting period. Fehst stated an alternative motion would be to table the Ordinance. Wyckoff stated Gonsior's plans include possibly a coffee shop, a Davanni 's, and a bagel shop. Wyckoff indicated he would pay $375, 000 or more, if necessary. Mayor Peterson opened the Public Hearing. Mr. Bill McReavy Jr. addressed the Council and audience with his plans for the building, the background and location and standing of his family owned funeral home business. They learned of the available building about one and one-half years ago but were involved in another project at the time. The business wouM retain the present architecture style and upgrade the facility. They want to be part of and be involved in this community and the redevelopment of Central Avenue. Bill McReavy Sr. showed a picture of their plan for the exterior of the building. Peterson opened discussion to the audience. Chester Shattuck, 3971 Quincy Street, liked the idea of something being done with the building but felt there could be something better that would fit in by the bus terminal, like shops or a restaurant. He wanted Washburn- McReavy to consider another area of the city. Archie Anderson, 999 41st Avenue, stated he lives in the condo behind the building and was opposed to a funeral home in this area. He asked Council to table action on the Ordinance. He presented a petition with 180 names to the Deputy City Clerk. The petition read: I would prefer that the building at 4101 Central Avenue not be sold to a funeral home, and that the building be put up for public sale and other options considered before such a decision is made. Bob Buboltz, 4311 5th Street, suggested tabling this sale to see what other options are available. Dee Logan, 1221 39th Avenue, asked Councilmembers whom they had approached regarding the availability of this building. Wyckoff stated Dunn Brothers, owners of several coffee shops, were given a tour of the building, and stated they could offer $400,000 but could not occupy the building as quickly as the current offer. Logan suggested encouraging businesses that would serve more families, and requested Council table this item. doyce Shellito stated the young people would like a place for them to go. She asked Council to anticipate the needs and changes the proximity of the new Medtronic company will have on our community. Lee Stauch, 1155 Khyber Lane, felt the property should be used for a public use such as a Police Department or Library. City Council Minutes October 9, 2000 Page 6 of I 1 J.D., a student, would like to see the building used for something for kids in the area. Peterson explained the Council's attempt to build a community center. Steve Azerman, 624 40th, felt the building should be sold to Washburn-McReavy for a funeral home, as the building has been empty for too long. Sue Amundson, 3 741 Reservoir Boulevard, agreed with Council action to purchase the property from FMF issue because they wanted something more vital there. She was aware it is legal to sell property without listing it for sale, but felt that it was not right to do so. She asked Council to remember they wanted to put something there the citizens could use. Cheryl Beck, 4321 Reservoir, felt this action was not publicized enough. Harold Hoium, 4315 -17-21 5th Street, stated that the funeral home would do well for the community, by looking nice, paying taxes, be a quiet business causing no trouble, and in a community with an older population be beneficial. Autumn, a student, wanted to see the building turned in to a place kids could go to. Kathy Ahlers, 4010 Hayes, requested a three month moratorium before a decision was reached. She stated she was on the Downtown Committee and this use was not what they had in mind. She felt this was a conflict of interest for the Councilmember who is also a Washburn-McReavy employee. Hunter stated that the City Attorney did not see this as a conflict of interest, and his belief is this sale is a sound business decision. Karsten McCarthy, 4213 5th Street, felt the City Council should hold off on the sale of this building. Diane DeLaria, 4129 Madison, wanted this sale held off for three months. She is against selling the building for use as a funeral home. Bill McReavy Jr. responded to audience comments. He described the locations of their nine funeral chapels and the benefits/revitalization they each bring to the community they are located in. Jolly commented on the petition that was presented and possible interpretation questions. Richard Dustin, 1708 39th Street, gave his background of City involvement. He stated that he is frustrated because every time the city tries to move ahead, complainers try to shoot it down. He stated the City Council is doing an excellent job. Sue Amundson stated the issue isn't against Washburn-McReavy. Her concern is actions being taken regarding Central Avenue. Chester Shattuck, stated that after listening to all the comments he has changed his mind, and felt the City Council should approve the sale of this building to Washburn-McReavy Funeral Chapels. Doug Hill, 103 7 43ra Avenue, suggested advertising the sale. He felt if ordinances were more lenient, it would draw retail business. Dee Logan stated she was dissatisfied with this process and spoke of democracy. City Council Minutes October 9, 2000 Page 7 of 11 Harold Hoium stated there is already too many empty stores and felt this sale would attract other businesses. Mayor Peterson closed the Public Heating and called for a roll call vote. Upon vote: Councilmember Szurek - yes, Councilmember Jolly - yes, Councilmember Wyckoff- no. Wyckoff proceeded to the podium to "speak for the people she represents ". She spoke of the future of Central Avenue and the Transit Hub. She disagreed with comments regarding the petition presented by residents. Wyckoff felt the Council should wait for the right offer, like the City of Fridley did for the Medtronic project. She felt some developer might be interested to purchase the 4101 Central building and the building to the north that is also for sale. Wyckoff stated there should be competition for the highest bid and for the best business. Councilmember Hunter abstained from voting. Peterson thanked everyone for their input and discussion. He agreed with Wyckoff that we need a good anchor in our downtown and he believes the funeral chapel would be that anchor and could bring businesses into the surrounding empty buildings. Peterson stated the project next to NEI would not be low-income housing, but 55 units of senior assisted living, and 20 affordable living units, with rents averaging $800 per month. Only three of the units will be Hollman units. Peterson stated Columbia Heights is an affordable community and there is nothing wrong with this. He stated the revitalization of this community must continue. This sale will be good for the community, get the property back on the tax roles, get our money back so we can move on to the next project. He stated that five years from now residents would agree this was a good idea to do this. Mayor Peterson vote yes. Motion carried. 7. ITEMS FOR CONSIDERATION Other Ordinances and Resolutions Bid Considerations Adopt Resolution No. 2000-71, accepting bids and awarding contract for Retaining Wall construction prqjects #9818 and 0012 at Jefferson Divide, 5255 7th Street (on 53rd Ave) and 4342 Arthur Street Motion by Jolly, second by Szurek, to waive the reading of Resolution No. 2000- 71, there being ample copies available to the public. Upon vote: All ayes. Motion by Jolly, second by Szurek, to approve and adopt Resolution No. 2000-71, accepting bids and awarding the Retaining Wall Construction Projects No. 39818 and #0012 along State Aid Streets: Jefferson Divide, 5255 7th Street (on 53rd Avenue) and 4342 Arthur Street to Sunram Construction Inc. of Corcoran, Minnesota, based upon their low responsible bid in the amount of $139,866.23 to be appropriated from Funds 402-59818-5130 and 402-50012-5130; and, furthermore, to authorize the Mayor and City Manager to enter into an agreement for the same. City Council Minutes October 9, 2000 Page 8 of 11 Kevin Hansen, Public Works Director, stated this is part of the annual retaining walls program on city streets. These projects have been on the list for a number of years and resident input is considered when deciding priority of projects. Completion date is estimated for dune 2001. Upon vote: All ayes. RESOLUTION NO. 2000-71 RESOLUTION ACCEPTING BIDS AND AWARDING CONTRACT FOR RETAINING WALL CONSTRUCTION PROJECTS #9818 AND #0012 WHEREAS, pursuant to an advertisement for bids for 2000 Improvement projects #9818 and #0012 Retaining Wall Construction, bids were received, opened and tabulated according to law. The following bids were received complying with the advertisement: Bidder Sunram Construction Nadeau Utility, Inc. Schmidt Curb Company Inc. Thor Construction TMS Construction Inc. Timme, Inc. Base Bid $139,866.23 $154,333.30 $158,606.75 $163,053.05 $165,093.78 $165,100.74 WHEREAS, it appears that Sunram Construction, 20010 75th Avenue North, Corcoran, Minnesota, is the lowest responsible bidder, NOW THEREFORE BE IT RESOLVED by the City Council of Columbia Heights, Minnesota: The Mayor and Clerk are hereby authorized and directed to enter into a contract with Sunram Construction in the name of the City of Columbia Heights for 2000 Improvement Projects #9818 and #0012, according to plans and specifications therefore approved by the Council. The City Engineer is hereby authorized and directed to return, forthwith, to all bidders, the deposits made with their bids except the deposit of the successful bidder and the next lower bidder shall be retained until the contract has been signed. City Projects #9818 and gOO 12 shall be funded with 100% City funds - Municipal State Aid Construction funds. Dated this 9th day of October 2000. Offered by: Jolly Seconded by: Szurek Roll Call: All ayes Mayor Gary Peterson Patricia Muscovitz, Deputy City Clerk Adopt Resolution No. 2000-72 accepting bids and awarding the demolition, removal and restoration of the Huset Band Shell and adjacent areas City Council Minutes October 9, 2000 Page 9 of 11 Motion by Hunter, second by Wyckoff, to waive the reading of Resolution No. 2000-72, there being ample copies available to the public. Upon vote: All ayes. Motion carried. Motion by Hunter, second by Wyckoff, to approve and adopt Resolution No. 2000-72 accepting bids and awarding the demolition, removal and restoration of the Huset Band Shell Areas to Kevitt Excavating Inc. of Crystal, Minnesota, based upon their low, qualified responsible quotation in the amount of $5,375.00; and furthermore, to authorize the Mayor and City Manager to enter into an agreement for the same. Funding would be provided from the City's Parks Capital Improvement Funds 412-45200. Hansen indicated this was an informal bid, not formally advertised, as the bid was under the State required amount for formal bids. Signed quotes were delivered to the Public Works Department. He stated the surrounding area consists of leveling the area to grade and repairs to truck traffic damage. Joyce Shellito asked why this could be removed so quickly, but it takes so long for removal of residential buildings. Ken Anderson, Community Development Director, stated she was referring to the City owned Lookout Place residences, which are currently being used for police and fire training. Bids are currently being prepared. He explained block grant restrictions, the necessity of asbestos removal at one of the homes, and required permits before a controlled burn can take place. Peterson stated the City did not have ownership of these homes until duly. Mel Collova, Building Official, reviewed the process before removal can take place. Fehst indicated there was not a specific date for removal set. Demolition contractors are busy so there was only one response for this work. Collova stated the building has been posted several times and is being monitored by the Police Department. Peterson requested Mr. Anderson develop a timetable for removal of these buildings and forward a copy to Ms. Shellito. Upon vote: All ayes. Motion carried. RESOLUTION NO. 2000-72 RESOLUTION ACCEPTING BIDS AND AWARDING CONTRACT FOR DEMOLITION, REMOVAL AND RESTORATION OF HUSET BAND SHELL AND ADJACENT AREAS WHEREAS, pursuant to an advertisement for bids for Demolition, Removal and Restoration of the Huset Park Band Shell and Adjacent Areas, quotations were received, opened and tabulated according to law. The following bids were received complying with the advertisement: Bidder Kevitt Excavating Inc. Wickenhouser Excavating Inc. Land Recycling Service Inc. USD Minnesota - LLC Belair Excavating Veit & Company Ceres Environmental K-B Excavating Base Bid $ 5,375 $ 5,55O $ 5,664 $ 6,250 $ 6,288 $ 6,675 $ 9,OOO $16,884 City Council Minutes October 9, 2000 Page 10 of 11 WHEREAS, it appears that Kevitt Excavating Inc, 3335 Permsylvania Avenue North, Crystal, Minnesota, is the lowest responsible bidder, NOW THEREFORE BE IT RESOLVED by the City Council of Columbia Heights, Minnesota: The Mayor and Clerk are hereby authorized and directed to enter into a contract with Kevitt Excavating Inc. in the name of the City of Columbia Heights for Demolition, Removal and Restoration of the Huset Park Band Shell and Adjacent Areas according to plans and specifications therefore approved by the Council. 2. City Project shall be funded with approximately 100% Parks Capital Improvement Funds. Dated this 9th day of October 2000. Offered by: Hunter Seconded by: Wyckoff Roll Call: All ayes Mayor Gary Peterson Patricia Muscovitz, Deputy City Clerk Other Business 1. Approval of the Sale and Development Agreement for 3855 Main Street NE Motion by Wyckoff, second by Szurek, to approve the Sale/Development Agreement with Mr. Brian Michael Roeller, of 3849 Main Street N.E., for an amount of $20,000 plus associated costs; and furthermore, to authorize the Mayor and City Manager to enter into an agreement for the same. Upon vote: All ayes. Motion Carried. ADMINISTRATIVE REPORTS A. Report of the City Manager Fehst indicated there would be a benefit for Michaela Knutson at the Fridley American Legion Post 4/303 on Thursday, October 12th. This fundraiser is a joint effort by the Columbia Heights and Fridley Police Departments. The address of where to send donations was posted on the cable screen. B. Report of the City Attorney - None GENERAL COUNCIL COMMUNICATIONS A. Minutes of Boards and Commissions 1) Special Meeting of the August 28, 2000 Housing and Redevelopment Authority 2) Meeting of the September 13, 2000 Traffic Commission 3) Meeting of the October 2, 2000 Traffic Commission 4) Meeting of the September 21, 2000 Telecommunications Commission 5) Meeting of the October 3, Planning and Zoning Commission City Council Minutes October 9, 2000 Pagellofll 10. CITIZENS FORUM (At this time, citizens have an opportunity to discuss with the Council items not on the regular agenda. The citizen is requested to limit their comments to five minutes. Please note the public may address the Council regarding specific agenda items at the time the item is being discussed.) None. 11. ADJOURNMENT Mayor Peterson adjourned the meeting at 10:20 p.m. Patricia Muscovitz, Deputy City Clerk OFFICIAL PROCEEDINGS OF COLUMBIA HEIGHTS CITY COUNCIL BOARD/COMMISSION INTERVIEWS HELD: OCTOBER 16, 2000, 6:00 P.M. CONFERENCE ROOM I Present: Mayor Peterson, Councilmember Szurek, Councilmember Wyckoff, and Councilmember Hunter Absent: Councilmember Jolly 1. Interviewed candidate #1 - 6:00 p.m. Donna Kay Schmitt, 4260 Tyler Street NE 2. Interviewed candidate #2 - 6:20 p.m. Harold Netkow, 1160 49th Avenue NE Upon consensus, Donna Schmitt was recommended for appointment to the Planning and Zoning Commission and Harold Netkow was recommended for appointment to the Police and Fire Civil Service Commission. Upon Consensus, Mayor Peterson will contact Roger Peterson to ask if he will be a representative on the Park and Recreation Commission. Meeting concluded at 7:05 p.m. Patricia Muscovitz, Deputy City Clerk COLUMBIA HEIGHTS - CITY COUNCIL LETTER Meeting of: October 23, 2000 AGENDA SECTION: 1_~ A ORIGINATING DEPARTMENT: CITY MANAGERS /-\ NO: CITY MANAGER ITEM: November 2000 Work Session and BY Walt Fehst BY: Budget Hearing Dates DATE: October 18, 2000 DATE: NO: Dates Work Sessions dates: It is recommended that Work Session for November, 2000, be scheduled for: 1. Monday, October 30, 2000 at 7:00 p.m. It is recommended that the Budget Hearings be scheduled for: 2. Monday, November 6, 2000 at 6:00 p.m. (Sandwiches will be provided) Reminder: Monday, November 20, 2000 at 7:00 p.m. has been approved for the Levy Hearing RECOMMENDED MOTION: Move to establish a Work Session meeting date for Monday, October 30, 2000 at 7:00 p.m., and the Budget Hearing meeting for Monday, November 6, 2000, at 6:00 p.m. COUNCIL ACTION: h52000d0 23worksession dates CITY COUNCIL LETTER Meeting of: October 23, 2000 AGENDA SECTION: CONSENT L/ /~ ~ ORIGINATING DEPARTMENT: CITY MANAGER'S NO: CITY MANAGER'S APPROVAL/,/ z NO: AMENDED PLAN DOCUMENTS DATE: 10-17~D~A : In 1992, the City Council authorized the implementation of a xible benefit program for eligible city employees to be administered by Flex Compensation, Inc. The plan was implemented effective February 1, 1993. In general, the necessary plan documents (Flexible Benefit Plan, Health Care Reimbursement Plan, Dependent Care Reimbursement Plan) as well as the Summary Plan Description are required to be restated every ten years, or every five years when there are material modifications. However, with the release in March, 2001, of final regulations governing flexible benefit plans, it is required that plan documents be restated for plan years beginning on or after January 1, 2001. In restating the plan documents, the following substantive changes are recommended and have been incorporated into the documents: PROVISION CURRENT EFFECTIVE JANUARY 1, 2001 Eligibility for participation First day of plan year Date of hire in Health Care Reimbursement following completion of six Account months of employment Maximum (annual amount) employees may elect to have reduced from their salary $1,500 $2,600 before taxes to reimburse them for eligible health care expenses Other changes to the plan documents have been made consistent with the final regulations. The City council must adopt the amended plan documents by resolution. RECOMMENDED MOTION: Move to waive the reading of the resolution, there being ample copies available to the public. RECOMMENDED MOTION: Move to adopt Resolution 2000-73, being a resolution adopting the amended plan documents for the Columbia Heights Flexible Benefit Program. COUNCIL ACTION: RESOLUTION 2000-73 RESOLUTION ADOPTING CHANGES TO PLAN DOCUMENTS FOR THE COLUMBIA HEIGHTS FLEXIBLE BENEFIT PROGRAM WHEREAS, the City of Columbia Heights desires to continue to offer its employees a flexible benefit program providing for reimbursement of medical expenses and dependent care expenses, and payment of employees' insurance premiums, and a plan entitled the City of Columbia Heights Flexible Benefit plan has been prepared and submitted to the City Council with a recommendation of adoption. NOW, THEREFORE, BE IT RESOLVED THAT, the City Council amends its current Plans entitled the City of Columbia Heights Flexible Benefit Plan, City of Columbia Heights Health Care Reimbursement Plan, City of Columbia Heights Dependent Care Reimbursement Plan which were originally effective February 1, 1993, replacing them, and by adopting in whole the enclosed Plan bearing an effective date of January 1, 2001, and directs the City Manager to implement the Plan in accordance with its terms. Passed this 23~ day of October 2000. Offered by: Seconded by: Roll Call: Gary L. Peterson, Mayor Patricia Muscovitz, Deputy City Clerk FLEXIBLE BENEFIT PLAN DOCUMENT 1162806 v4 TABLE OF CONTENTS ARTICLE I: INTRODUCTION .................................................................................................... I Section 1.1 Purpose ............................................................................................................ 1 Section 1.2 Rules of Construction ..................................................................................... 1 ARTICLE II: DEFINITIONS ........................................................................................................ 1 Section 2.1 Code ................................................................................................................ 1 Section 2.2 Compensation ................................................................................................. I Section 2.3 Dependent ....................................................................................................... 1 Section 2.4 Dependent Care Account ................................................................................ 1 Section 2.5 Dependent Care Expense ................................................................................ 1 Section 2.6 Effective Date ................................................................................................. 2 Section 2.? Election ........................................................................................................... 2 Section 2.8 Employer ......................................................................................................... 2 Section 2.9 FMLA Leave ................................................................................................... 2 Section 2.10 Gainfully Employed ...................................................................................... 2 Section 2.11 Health Care Account ..................................................................................... 2 Section 2.12 Health Expense .............................................................................................. 2 Section 2.13 Highly Compensated Employee ................................................................... 3 Section 2.14 Key Employee ............................................................................................... 3 Section 2.15 Optional Benefits .......................................................................................... 3 Section 2.16 Participant ..................................................................................................... 3 Section 2.17 Period of Coverage ....................................................................................... 3 Section 2.18 Plan ............................................................................................................... 4 Section 2.19 Plan Administrator ........................................................................................ 4 Section 2.20 Plan Year ....................................................................................................... 4 Section 2.21 Qualified Employee ...................................................................................... 4 Section 2.22 Qualifying Dependent ................................................................................... 4 Section 2.23 Summary Pages ............................................................................................. Section 2.24 Student .......................................................................................................... Section 2.25 USERRA Leave ............................................................................................. 5 ARTICLE III: ELIGIBILITY AND PARTICIPATION ............................................................... 5 Section 3.1 Eligibility ........................................................................................................ 5 Section 3.2 Commencement of Participation ..................................................................... 5 Section 3.3 Termination of Participation ........................................................................... 5 Section 3.4 Participation during Unpaid Leave ................................................................. 6 Section 3.5 Continuation of Coverage ................................................................................ 7 ARTICLE IV: CONTRIBUTIONS ............................................................................................... 7 Section 4.1 Salary Reduction Contributions ...................................................................... 7 Section 4.2 Benefit Credits ................................................................................................ 8 Section 4.3 Maximum Contribution .................................................................................. 8 11628fSv3 ARTICLE V: BENEFITS .............................................................................................................. 8 Section 5.1 Benefit Options ............................................................................................... 8 Section 5.2 Benefit Descriptions ........................................................................................ 8 Section 5.3 Limitation of Benefits ..................................................................................... 9 Section 5.4 Appeal Procedure ............................................................................................ 9 Section 5.5 Forfeitures ....................................................................................................... 9 ARTICLE VI: ELECTION PROCEDURES ................................................................................. 9 Section 6.1 Election Form and Timing .............................................................................. 9 Section 6.2 Elections Irrevocable but for Change in Status ............................................. 10 Section 6.3 Failure to Elect .............................................................................................. 12 Section 6.4 Automatic Termination of Election .............................................................. 13 Section 6.5 Requalifying Employees ............................................................................... 13 ARTICLE VII: PREMIUM CONVERSION ............................................................................... 13 Section 7.1 Applicability of this Article .......................................................................... 13 Section 7.2 Premium Conversion .................................................................................... 13 ARTICLE VIII: HEALTH CARE REIMBURSEMENT ............................................................. 13 Section 8.1 Applicabilily of this Article .......................................................................... 13 Section Section Section Section Section Section Section 8.2 Purpose .......................................................................................................... 13 8.3 Definitions ..................................................................................................... 14 8.4 Health Care Account ..................................................................................... 14 8.5 Claims for Reimbursement ........................................................................... 14 8.6 Reimbursement of Expense ........................................................................... 15 8.7 Maximum Reimbursement ............................................................................ 15 8.8 Revocation of Election .................................................................................. 15 ARTICLE IX: DEPENDENT CARE REIMBURSEMENT ....................................................... 15 Section 9.1 Applicability of this Article .......................................................................... 15 Section 9.2 Section 9.3 Section 9.4 Section 9.5 Section 9.6 Section 9.7 Purpose .......................................................................................................... 15 Definitions ..................................................................................................... 15 Dependent Care Account .............................................................................. 17 Claims for Reimbursement ........................................................................... 17 Reimbursement of Expense .......................................................................... 18 Maximum Reimbursement ............................................................................ 18 ARTICLE X: ADMINISTRATION ............................................................................................ 18 Section 10.1 Plan Administrator ...................................................................................... 18 Section 10.2 Powers of the Plan Administrator ............................................................... 18 Section 10.3 Actions of the Plan Administrator .............................................................. 19 Section 10.4 Information to be Furnished ........................................................................ 19 Section 10.5 Nondiscrimination ....................................................................................... 19 Section 10.6 Changes by Administrator .......................................................................... 19 Section 1 &7 Reporting and Disclosure ............................................................................ 20 1162806 v3 Section 10.8 Indemnification of the Administrator ......................................................... 20 ARTICLE XI: MISCELLANEOUS ............................................................................................ 20 Section 11.1 Amendment and Termination ..................................................................... 20 Section 11.2 Plan Not a Contract of Employment ........................................................... 20 Section 11.3 Funding ....................................................................................................... 20 Section 11.4 No Guarantee of Tax Consequences ........................................................... 21 Section 11.5 Plan Benefits May Not be Assigned ........................................................... 21 Section 11.6 Governing Law ........................................................................................... 21 1162806 v3 FLEXIBLE BENEFIT PLAN ARTICLE I: INTRODUCTION Section 1.1 Purpose. The purpose of the Plan is to provide Participants with a choice between cash and certain "qualified benefits" as defined in Section 125 of the Code. The Plan is intended to qualify as a "Cafeteria Plan" under Section 125 of the Code so that Optional Benefits a Participant elects to receive under the Plan will be eligible for exclusion from the Participant's gross income under Section 125(a) of the Code. The Employer intends Plan terms, including those relating to coverage and benefits, to be legally enforceable. The Plan shall be maintained for the exclusive benefit of Qualified Employees. Section 1.2 Rules of Construction. The Plan shall be construed in accordance with the following rules: (a) Headings at the beginning of articles and sections are provided for convenience of reference and shall not influence construction of the Plan. (h) Capitalized words and phrases shall have the meaning defined in the Plan unless a different meaning is plainly required by the context. (c) Except as otherwise indicated by context, the masculine gender shall include the feminine, the singular shall include the plural, and vice versa. ARTICLE II: DEFINITIONS Section 2.1 Code means the Internal Revenue Code of 1986, as amended, and its regulations. Section 2.2 Compensation means the total wages and salary, including salary reduction amounts, overtime payments and bonus payments, which are paid by the Employer to a Participant during the Plan Year. Section 2.3 Dependent for purposes of Premium Conversion under Article VII and Health Care Reimbursement under Article VIII means the spouse of a Participant or any individual who is a dependent of the Participant as defined in Section 152 of the Code and any Alternate Recipient under a Qualified Medical Child Support Order ("QMSCO") as defined in ERISA Section 609. Section 2.4 Dependent Care Account means the account established and maintained by the Employer under Article IX, to record a Participant's interest in the Plan. Section 2.5 Dependent Care Expense for the purpose of Dependent Care Reimbursement under Article IX, means an amount paid or incurred by the Participant for expenses for the care of a Qualifying Dependent or for related household services, but only if such expenses were incurred to enable the Participant (and spouse if ap~'_icable) to be Gainfully Employed during the period in 1162806 v3 I which the expenses were incurred. Expenses for services delivered outside of the Participant's home for a Qualifying Dependent described in Section 2.22(b) shall be Dependent Care Expenses only if such Qualifying Dependent regularly spends at least eight (8) hours per day in the Participant's household. Expenses shall be considered incurred on the date services are provided. Eligible expenses do not include: amounts paid for food, clothing or education unless such expenses are incidental to and inseparable fxom the care provided; educational expenses for a child in kindergarten or higher grade; or expenses for services at a camp where the Qualifying Dependent stays overnight. Eligible expenses do not include amounts paid to: (a) A dependent care facility or person providing care for more than six (6) nonresident individuals which does not comply with all applicable laws and regulations of the state or local government in which it is located; or (b) A child of the Participant under the age of nineteen (19) at the close of the Plan Year; or (c) Any other individual which the Participant or the Participant's spouse may claim as a dependent under Section 151(c) of the Code. Section 2.6 Effective Date means the Effective Date as shown in the Summary Pages. Section 2.7 Election means an election pursuant to Article VI by a Qualified Employee to participate in the Plan and the allocation by the Participant of elective contributions made on the Participant's behalf among Optional Benefits available under the Plan. Section 2.8 Employer means the entity named as the Employer in the Summary Pages, or any successor that agrees to continue the Plan and any affiliated employer which adopts the Plan. Affiliated employer in this regard means another corporation which is a member of a controlled group of corporations, any trade or business under common control or an affiliated service group. Section 2.9 FMLA Leave means a leave of absence that the Employer is required to extend to a Participant under the provisions of the Family and Medical Leave Act of 1993. Section 2.10 Gainfully Employed for the purpose of Dependent Care Reimbursement under Article IX, means the earning of income which is not nominal reimbursement for volunteer work, or the period of active search for gainful employment. Section 2.11 Health Care Account means the account established and maintained by the Employer under Article VIII, to record a Participant's interest in the Plan. Section 2.12 Health Expense for the purpose of Health Care Reimbursement under Article VIII, means an expense incurred during a Period of Coverage by a Participant or by the Dependent of a Participant for medical care as defined in Section 213 of the Code, excluding any insurance premiums for health coverage and excluding expenses fo, long term care. Expenses are considered 1162806 v3 2 incurred on the date services are rendered. Expenses are eligible only to the extent such expense is not reimbursable through insurance or some other source. Medical care generally refers to the diagnosis, cure, treatment, or prevention of disease or for the purpose of affecting any structure or function of the body and includes Iransportation expenses primarily for and essential to medical care. Section 2.13 Highly Compensated Employee means the following for each type of benefit described below: (a) for Health Care Reimbursement under Article VIII a highly compensated individual or participant as defined in Section 125(e) of the Code, (b) for Premium Conversion under Article VII a highly compensated employee for purposes of applicable nondiscrimination requirements of Section 105(h) of the Code means an employee who is highly compensated as defined in Section 105(h) of the Code, (c) for purposes of applicable nondiscrimination requirements of Section 129 of the Code for Dependent Care Reimbursement under Article IX, a highly compensated employee means an employee who is highly compensated as defined in Section 414(q) of the Code. Section 2.14 Key Employee means any person who is a key employee as defined in Section 416(i)(1) of the Code. Section 2.15 Optional Benefits means the following employee benefit plan(s) offered by the Employer: (a) (b) (c) Premium Conversion as described in Article VII Health Care Reimbursement as described in Article VIII Dependent Care Reimbursement as described in Article IX if adopted by the Employer as shown in the Summary Pages. Section 2.16 Participant means a Qualified Employee who has satisfied the eligibility requirements provided in Article III and who makes an Election to participate in the Plan. Section 2.17 Period of Coverage means the time period commencing on the first day of the Plan Year except for; (a) A new or requalifying Participant who satisfies the participation requirements of Article III during the Plan Year, (b) A Participant who has a Change in Status (as defined in Section 6.2(c)) during a Plan Year, or 1162806 v3 3 (c) A Participant whose participation in the Plan terminates during the Plan Year in accordance with Section 3.3, in which case the Period of Coverage shall be the time period commencing on mid-year entry date as shown in the Summary Pages following receipt by the Plan Administrator of an Election by the Participant and ending on the date participation in the Plan terminates in accordance with Section 3.3. Section 2.18 Plan means the Flexible Benefit Plan as set forth herein, and as amended from time to time. Section 2.19 Plan Administrator means the Employer or such other person or persons designated to administer the Plan pursuant to Article X. Section 2.20 Plan Year means the period designated as the Plan Year as shown in the Summary Pages. Section 2.21 Qualified Employee means an individual who receives Compensation from the Employer and who meets the eligibility requirements shown in the Summary Pages and who is not 1) an owner-employee of the Employer as defined in Section 401 (c)(1)(B)(3) of the Code, or 2) a shareholder if the Employer is a subchapter S corporation as defined in Section 1361(a) of the Code. Bargaining unit employees are eligible only if there was good faith bargaining about cafeteria plan benefits and the applicable bargaining agreement between the Employer and the employees' representative provides for participation in the Plan. Section2.22 Qualif~ingDependent. ForpurposesofDependentCare Reimbursememunder Article IX means any individual who is, (a) A child of the Participant under the age of thirteen (13) and for whom the Participant is entitled to an exemption under Section 151 (c) of the Code, or (b) A dependent or spouse of the Participant who is physically or mentally incapable of self-care. (c) Where the parents are divorced, legally separated or separated under a written separation agreemem, a child (as defined in Section 151 (c)(3) of the Code) who: 1) is under age 13 or is physically or mentally incapable of self-care, 2) receives over half of his or her support during the calendar year from his or her parents who are divorced or legally separated under a decree of divorce or separate maintenance or who are separated under a written separation agreement, and 3) is in the custody of one or both of his or her parents for mom than one-half of the calendar year. 1162806 v3 4 is treated for any taxable year beginning in the calendar year as a Qualifying Dependent of that parent who has custody for a longer period during the calendar year than the other parent. Accordingly, a child may be treated as the Qualifying Dependent of a parent even though that parent is not entitled to a dependency exemption for the child under Code Section 152. Only one parent may treat the child as a Qualifying Dependent. Section 2.23 Summary Pages means the elections made by a particular employer in adopting this Plan, attached hereto as "Summary Pages" and incorporated herein by reference. Section 2.24 Student means an individual who, during each of five (5) calendar months during a taxable year, is a full-time student at an educational organization which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where its educational activities are regularly carried on. Section 2.25 USERRA Leave means a leave of absence that the Employer is required to extend to a Participant under the provisions of the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended from time to time. A Participant returning from a USERRA Leave shall have elections and benefits restored to him at the same level and type that were in effect at the time when the USERRA Leave began, as well as any benefits that began during the leave of absence for which the Participant would have reasonably become eligible. ARTICLE III: ELIGIBILITY AND PARTICIPATION Section 3.1 Eligibility. A Qualified Employee will become eligible to participate in the Plan on the mid-year entry date shown in the Summary Pages. If there is a length of service requirement shown in the Summary Pages, time that a Qualified Employee spends on an FMLA Leave or USERRA Leave will count toward fulfilling the length of such service requirement. Section 3.2 Commencement of Participation. Participation commences on the first day of a Period of Coverage for which an Election is filed in accordance with Article VI. Except as provided below, an Election shall be effective on the first day of the next Plan Year. If a new Qualified Employee (or a Qualified Employee who has a Change in Status) files an Election during the Plan Year in accordance with Article VI, such Election shall be effective as of the mid-year entry date shown in the Summary Pages. Section 3.3 Termination of Participation. A Participant will cease to be a Participant in the Plan on the earliest of: (a) the date on which any Optional Benefit with respect to which the Participant has an Election terminates, but only to the extent of the Participant's participation in that Optional Benefit, 1162806 v3 5 (b) the date the Participant is no longer a Qualified Employee, (c) the first day of a Period of Coverage for which an Election is revoked pursuant to Section 6.2, (d) the last day of the Plan Year for which an Election is filed, (e) the date required Employee contributions cease, or (f) the date on which the Plan terminates. However, if adopted in the Summary Pages, Participants who are no longer Qualified Employees due to termination of employment may resume Plan participation under the Participant's original Election if such Participant returns to employment within 30 days after termination. Further, a Participant who returns to employment during the same Plan Year, but after 30 days, may be treated as having a change in status and may be allowed to resume the original Election or make an Election change. Termination of participation in this Plan shall not prevent a former Participant from continued coverage or benefits under respective Optional Benefit plans (as provided in Sections 3.4 and 3.5) if and to the extent provided by such plans or as authorized by any applicable state or federal law. Section 3.4 Participation during Unpaid Leave. A Participant who is not at work because of an unpaid leave of absence (including an FMLA Leave or USERRA Leave), may, at the Participant's option, continue any and all Optional Benefits under the Plan that such Participant elected for the Plan Year during the period of the absence, provided that, the Participant makes all required contributions for such Optional Benefits. Such Participant may choose from among any of the payment options adopted in the Summary Pages, including the following: (a) PRE-PAY: At the Participant's request, paying the amounts through salary reduction that will become due during the leave out of one or more of the Participant's paychecks preceding the leave; (b) AFTER-TAX PAY AS YOU GO: Remitting after-tax payments to the Employer on or before each pay period for which the contributions would have been deducted from the Participant's paycheck if the leave had not been taken, provided that any delinquent payments must be made within thirty (30) days of their due date; (c) PRE-TAX PAY AS YOU GO: Pre-tax salary reduction contributions from payments to the Participant (i.e., sick pay, wage continuation, short term disability benefits or vacation pay) during the leave; or (d) PAY ON RETURN: From paychecks following the leave provided that all contributions are made within the Plan Year in which the Election occurs and provided that the Participant and Employer agree to this payment option (c) before the Unpaid Leave commences. 1162806 v3 6 Section 3.5 Continuation of Coverage. For purposes of the Health Care Reimbursement Optional Benefit described in Article VIII only, a Participant whose coverage under such Optional Benefit would otherwise terminate may elect to continue coverage under this Optional Benefit in accordance with the rules of Section 4980B of the Code. A Participant who elects to continue coverage under this Optional Benefit shall pay to the Employer an amount designated by the Employer up to the maximum amount permitted under Section 4980B of the Code. A Participant who takes an FMLA Leave may continue coverage under the provisions of the Family and Medical Leave Act of 1993. For purposes of applying the provisions of Code Section 4980B, a Participant who takes an FMLA Leave and who does not return to service as a Qualified Employee at the expiration of the FMLA Leave, will become subject to the provisions of Section 4980B at the expiration of the FMLA Leave. A Participant who takes a USERRA Leave for less than 31 days may continue on such benefit plans on the same terms as active employees. A Participant who takes a USERRA Leave for 31 days or more may continue coverage under the provisions of USERRA and Code Section 4980B, making contributions at the rate charged for continuation coverage (as described in Section 3.5(a)) for other Participants, as determined by the Employer up to the maximum amount permitted under Section 4980B of the Code. A Participant on FMLA Leave or USERRA Leave who does not elect to continue participation in the Health Care Reimbursement Optional Benefit under this Section 3.5 shall not be entitled to payment or reimbursement of Health Expenses incurred during his FMLA Leave or USERRA Leave, nor shall such Participant be entitled to retroactively elect coverage of such expenses under the Plan upon his reinstatement in the Plan. In lieu of the foregoing continuation coverage provisions, the Employer may establish a policy whereby Participants can waive continuation of coverage and choose instead to extend coverage by self paying the remaining premiums, at an amount determined by the Employer. In addition to the foregoing, the Plan will permit a Participant to continue coverage in accordance with any other provision of applicable law requiring such continuation. This Section 3.5 shall apply only the Health Care Reimbursement Optional Benefit described in Article VIII. ARTICLE IV: CONTRIBUTIONS Section 4.1 Salary Reduction Contributions. A Participant may elect in accordance with the election procedures described in Article VI to receive his or her full Compensation for any Period of Coverage in cash, or to have a portion of such Compensation applied by the Employer toward the Participant's share of the cost of Optional Benefits available under Article V and as elected by the Employer in the Summary Pages. If so elected, the Participant'sCompensationwill be reduced, and an amount equal to the reduction will be allocated by the Employer to the Optional Benefits 1162806 v3 7 designated by the Participant. Pro rata amounts of the total salary reduction election will be deducted from a Participant's Compensation at least once per month but not more frequently than once per pay period unless the Employer adopts a specific policy which provides for contributions on a periodic basis other than level pro rata amounts. The amount of the salary reduction election for the premium conversion option described in Section 7.2 shall be the Participant's share of the cost of Employer-sponsored health benefits, as determined by the Employer, taking into account any benefit credits available to the Participant under Section 4.2. If the employee's share of the cost for Employer sponsored health plan(s) changes during the Period of Coverage due to a change in the cost of coverage provided by an independent third party, a Participant's salary reduction for such benefit(s) will be adjusted automatically in accordance with the change in cost. Section 4.2 Benefit Credits. The Employer may make available to Participants elective Employer provided benefit credits which the Employer shall allocate to offset the cost of Optional Benefits elected by the Participant in accordance with the election procedures described in Article VI. The amount of benefit credit available under this Section, if any, is shown in the Summary Pages. For a Period of Coverage which is less than 12 months, the amount of any Benefit Credit available under this Section 4.2 shall be pro rated by multiplying the annual amount by a fraction with a numerator equal to the number of pay periods in such Period of Coverage and denominator of the total number of pay periods in one year. Benefit Credits as determined above shall be earned in equal pro rata amounts on the last day of each payroll period throughout the Period of Coverage. Benefit Credits in excess of the cost of Optional Benefits ("Excess Credits") elected by the Participant may be forfeited or distributed in whole or in part to the Participant, as selected by the Employer in the Summary Pages. Section 4.3 Maximum Contribmion. The maximum amoum of Employer contributions under this Plan for any Participant for a Plan Year shall be the sum of the maximum salary reduction contribution shown in the Summary Pages and benefit credits described in Section 4.2. ARTICLE V: BENEFITS Section5.1 Benefit Options. A Participant may allocate elective contributions as provided in Article IV between cash and the Optional Benefits in Article II, as adopted by the Employer as shown in the Summary Pages. Section 5.2 Benefit Descriptions. While the election to receive one or more benefits may be made under this Plan, the benefits will be provided in accordance with the plan documents or contracts governing the respective benefits. The governing documents which describe the types and amounts of benefits available, the requirements for participation, procedures for submitting claims, 1162806 v3 8 and the other terms and conditions of coverage for each benefit are incorporated into this Plan by reference. Section 5.3 Limitation of Benefits. No Optional Benefits shall be paid to or on behalf of a Participant in excess of the amount elected by the Participant under the Plan. In no case shall the Plan allow a Participant to carry over unused contributions from one Plan Year to a subsequent Plan Year, or allow contributions from one Plan Year to purchase a qualified benefit that will be provided in a subsequent Plan Year. Section 5.4 Appeal Procedure. This appeal procedure shall apply to the extent that a claims appeal procedure is not provided for in the document governing the Optional Benefit. If any claim for benefits under the Plan is denied in whole or in part, the Participant shall be furnished promptly by the Plan Administrator a written notice: (a) outlining the reason for the denial, (b) making reference to pertinent Plan provisions on which denial is based, (c) describing any additional material or information which is necessary and why, and (d) explaining the claim review procedure set forth herein. Within sixty (60) days after denial of any claim for benefits under this Plan, the Participant may request in writing a review of the denial by the Plan Administrator. Any Participant seeking review hereunder is entitled to examine all pertinent documents, and to submit issues and comments in writing. The Plan Administrator shall render a decision on review of a claim not later than sixty (60) days after receipt of a request for review. However, if special circumstances require a delay and the Participant is so notified, the review may take up to one hundred twenty (120) days. The decision of the Plan Administrator on review shall be in writing and shall state the reason for the decision, referring to the Plan provisions upon which it is based. In the event that the Plan Administrator does not issue notice of decision within the time period set forth above, the Participant may deem the decision to have been denied. Section 5.5 Forfeitures. Ifa Participant has not used all amounts available for benefits to the Participant under any Optional Benefit for a Period of Coverage in accordance with the terms thereof, any remaining balance shall be forfeited by the Participant, who shall have no further claim thereto. Such forfeitures shall be used to offset the reasonable administrative costs of the Plan. ARTI,CLE VI: ELECTION PROCEDURES Section 6.1 Election Form and Timing. Elections must be in writing, shall specify the Optional Benefits to which elective contributions will be allocated and designate the amount, if any, of reimbursement account contributions. The Plan Administrator shall make available to all Qualified Employees a form on which to make benefit elections during an election period. Except 1162806 v3 9 as described in subsections (a), (b) and (c) below, the election period shall commence no earlier than the forty-five (45) day period immediately preceding the first day of the Plan Year. (a) The election period for a new Qualified Employee shall be a thirty (30) consecutive day period which commences on the date of satisfaction of the eligibility requirements defined in Section 3.1 have been met. (b) The election period for a Qualified Employee who has a change in status as defined in Section 6.2 shall be a thirty (30) consecutive day period which commences on the date of the change in status. (c) The election period for a Qualified Employee who returns to employment following a FMLA Leave or USERRA Leave shall be a thirty (30) consecutive day period which commences on the date of return to employment. The designated election form must be received by the Plan Administrator prior to the first day of the Plan Year. Except as described in subsections (a), (b) and (c) above, Elections received after the first day of the Plan Year shall be void. Section 6.2 Elections Irrevocable but for Change in Status. Once an Election becomes effective, such Election shall be irrevocable for the remainder of the Plan Year except under the following circumstances. (a) If the premium amount for a health plan significantly increases, a Participant may make a corresponding change in the amount of his or her Election, or revoke the Election and, if the Employer makes available another health plan with similar coverage, elect to receive coverage under such other health plan. If the cost of the health plan does not increase, but the Participant's share of the cost for coverage increases, a Participant may make a corresponding change in the amount of his or her Election (b) If the coverage under a health plan is significantly curtailed or ceases, a Participant may revoke his or her Election and, if the Employer makes available another health plan or health plan option with similar coverage, to elect to receive coverage under such other health plan or health plan option. Change in coverage also includes mid-year changes in coverage of a Dependent under another employer's plan due to differing enrollment periods of the Dependent's employer plan. Such Election change by the Participant must be made on account of and corresponding to the actual election made by the Dependent. (c) If a Participant has a change in status, the Participant may revoke his or her Election and submit a new Election for the remainder of the Plan Year. A change in status for the Premium Conversion and Health Care Reimbursement Plan Optional Benefits described in Section 2.15(a) and (b) means any of the following: 62806 v3 10 1) 2) 3) 4) 5) 6) 7) 8) enrollments made pursuant to the special enrollment roles of the Health Insurance Portability and Accountability Act of 1996, and including the enrollment of both new and pre-existing dependents, changes in the legal marital status of the Participant (i.e., marriage, divorce, death of a spouse, legal separation or annulment), changes in the number of Dependent children of the Participant (e.g., birth or death of a dependent, adoption or placement for adoption), termination or commencement of employment of a Participant or Dependent, changes in the work schedule of the Participant or Dependent, including, changing from full-time to part-time status (or vice versa), a strike, lockout or commencement of or return from unpaid leave, Change in eligibility rules for Employer-sponsored plan which result in the Participant's loss of eligibility, events which cause a Dependent to satisfy or fail to satisfy the eligibility requirements of a plan, such as the Dependent reaching the limiting age for coverage under the plan, or changes in the student status of the Dependent, or changes in the residence or worksite of the Participant or Dependent. A Participant may revoke a benefit Election for the balance of a Plan Year and file a new Election only if both the revocation and the new Election are due to and consistent with the reason that such change was permitted. An Employer may provide that a Participant who returns to work as a Qualified Employee within 30 days of termination will resume Plan participation under the Participant's original election provided there are no other intervening change in status events. An Employer may also permit a Participant who returns to work more than 30 days after termination of employment but within the same Plan Year, to have the option of resuming the original election or making a new election. This paragraph applies if adopted by the Employer as shown in the Summary Pages. For purposes of Election changes for Premium Conversion under Article VII and Health Care Reimbursement under Article VIII, consistency means that the following conditions have been met: 1) the change in status results in the Participant or Dependent gaining or losing eligibility under this Plan, or an accident or health plan of a Dependent's employer, and 2) the Election change corresponds with that gain or loss of coverage. Notwithstanding this consistency rule, an employee may increase the amount of Premium Conversion under Article VII to pay premiums for continuation of health care coverage under federal or state COBRA laws. For purposes of Election changes to a group term life insurance plan or disability insurance plan, consistency means either of the following: 1) in the case of birth, adoption or placement for adoption, the Participant can increase the amount of group term life insurance coverage, if allowed under the provisions of the Employer-sponsored group term life insurance plan, or 2) in the case of death of a dependent, the Participant can decrease the amount of group term life insurance coverage, if allowed m~der the provisions of the Employer-sponsored group term life insurance plan, or 3) in 1162806v3 II the case of divorce, legal separation, annulment, death of a spouse or change in status of the Participant's spouse or dependent's employment, the Participant can decrease or increase the amount of group term life insurance coverage, if allowed under the provisions of the Employer-sponsored group term life insurance plan. A change in status for other Optional Benefits (including Dependent Care Reimbursement under Article IX) includes marriage or divorce, death of Dependent, birth or adoption of a child, termination or commencement of a spouse's employment, change from full-time to part-time (or vice versa) of the Participant or spouse, the taking of an unpaid leave of absence by the Participant or spouse or a change in cost of care if imposed by a care giver who is not a relative of the Participant as defined in section 152(a)(1) through (8), incorporating the rules of section 152(b)(1) and (2) or a dependent reaching the age of 13 and no longer coming within the definition of Dependent. A Participant may revoke a benefit Election for such other Optional Benefits for the balance of a Plan Year and file a new Election only if both the revocation and the new Election are due to and consistent with the reason that such change was permitted. A new election must be filed within thirty (30) days after the date of the change in status. Change in status for any Optional Benefit shall also include other events as may be permitted under regulations and rulings of the Internal Revenue Service. (d) A Participant may change an Election as required to provide coverage for a dependent child pursuant to a court judgment, order, decree or QMSCO as described in Section 2.3 resulting from a divorce, legal separation, annulment or change in legal custody or may cancel or terminate coverage for a child if such court order or decree requires the Participant's former spouse or another person to provide coverage. This paragraph (d) applies only to the Optional Benefits described in Section 2.15(a) and (b). (e) If the Participant, or a Dependent who is enrolled in an accident or health plan of the Employer becomes enrolled under Part A or Part B of Title XVIII of the Social Security Act (Medicare) or Title XIX of the Social Security Act (Medicaid), other than coverage consisting solely of benefits under section 1928 of the Social Security Act (Distribution of Pediatric Vaccines), the Participant may make a corresponding Election change to cancel or reduce coverage for the Participant or Dependent under the accident or health plan. Further, if Participant, spouse or dependent who has been entitled to such coverage under Medicare or Medicaid loses eligibility for such coverage, the Participant may make a prospective election to commence or increase coverage for the Participant, spouse or dependent. This paragraph (e) applies only to Optional Benefits described in Section 2.15(a) and (b). (f) A Participant taking leave under the Family and Medical Leave Act (FMLA) may revoke an existing election of group plan coverage and make such other election for the remaining portion of the period of coverage as may be provided for under FMLA. Section6.3 Failure to Elect. AParticipantwhofailstoreturntherequiredElectionformfor any Period of Coverage t,~ the Plan Administrator before the first day of such Period of Coverage 1162806v3 12 shall be deemed to have elected to receive his or her full Compensation in cash, except to the extent that an alternate deemed election is contained in the Summary Pages. Section 6.4 Automatic Termination of Election. Elections made under this Plan shall automatically terminate on the date the Participant ceases to be a Participant in the Plan in accordance with Section 3.3, although coverage under Optional Benefits may continue if and to the extent provided by such plans. Section 6.5 Requalif¥ing Employees. Former Participants whose participation in the Plan terminated because of an Employer approved unpaid leave of absence, and who subsequently requalify for coverage during the same Plan Year shall have their Election for that Plan Year automatically reinstated unless such Election is revoked in accordance with Section 6.2. ARTICLE VII: PREMIUM CONVERSION Section 7.1 Applicability of this Article. The terms of this Article VII apply only to the extent that the Employer has adopted the Premium Conversion Optional Benefit in Section 2.15(a). The term "Election" as used in this Article VII refers to the Election made by a Participant pursuant to Article IV, to receive Optional Benefits described in such Section 2.15(a). Section 7.2 Premium Conversion. Participants may elect as a benefit under this Article pre- tax payment of the Participant's share of the cost for Employer-sponsored accident and health and/or group term life insurance benefits provided through an insured plan, a preferred provider organization, a health maintenance organization or other group arrangement in accordance with the options made available through the Employer. Once elected, this Optional Benefit shall be provided automatically, and as such, no separate claim need be submiued to the Plan Administrator. The Employer's liability for benefits provided by third parties through this premium conversion option shall be limited to the payment of required premiums. The Employer does not guarantee benefits payable under any insurance policy or other similar contract. Such benefits shall be the exclusive responsibility of the insurer or other entity that is required to provide the benefits under the governing policy or contract. ARTICLE VIII: HEALTH CARE REIMBURSEMENT Section 8.1 Applicability of this Article. The terms of this Article VIII apply only to the extent that the Employer has adopted the Health Care Reimbursement Optional Benefit in Section 2.15(b) in the Summary Pages. The term "Election" as used in this Article VII refers to the Election made by a Participant pursuant to Article IV, to receive Optional Benefits described in such Section 2.15(b). Section 8.2 Purpose. The purpose of the Health Care Reimbursement Optional Benefit described in this Article is to provide Participants with the option of being reimbursed for eligible Health Expenses. The Health Care Reimbursement Optional Benefit is intended to qualify as a medical reimbursement plan under Secdon 105 of the Code so that payments received pursuant to 1162806 v3 13 this Article and the Plan are excludable from the gross income of the Participant under Section 105(b) of the Code. Section 8.3 Definitions. For the purpose of the Health Care Reimbursement Optional Benefit described in this Article, the following definitions apply: (a) Health Expense means an expense incurred during a Period of Coverage by a Participant or by the Dependent of a Participant for medical care as defined in Section 213 of the Code, excluding any insurance premiums for health coverage and excluding expenses for long term care. Expenses are considered incurred on the date services are rendered. Expenses are eligible only to the extent such expense is not reimbursable through insurance or some other source. Medical care generally refers to the diagnosis, cure, treatment, prevention of disease or for the purpose of affecting any structure or function of the body. (b) Highly Compensated Employee means an employee who is highly compensated as defined in Section 105(h) of the Code. Section 8.4 Health Care Account. The Employer will establish and maintain for record keeping purposes a Health Care Account for each Plan Year for each Participant from whom an Election is received. The account will be increased as of each date compensation is paid to the Participant in an amount equal to the allocation, if any, which the Participant has elected. A Participant's Health Care Account will be decreased from time to time in the amount of payments made to the Participant for Health Expenses incurred during the Period of Coverage. All amounts added to a Health Care Account remain the property of the Employer until distributed to the Participant in accordance with this Article VIII. Section 8.5 Claims for Reimbursement. A Participant who has made an Election for a Plan Year may apply to the Plan Administrator for reimbursement of Health Expenses incurred during such Period of Coverage by executing and submitting a claim form which the Plan Administrator prescribes setting forth: (a) The amount, date and nature of the expense, (b) The name of the person or entity to which the expense was paid, (c) The Participant's statement that the expense has not been reimbursed or is not reimbursable from any other source, and (d) Such other information as the Plan Administrator may require. Such claim form shall be accompanied by bills, invoices, receipts, or other statements from an independent third party stating the Health Expense has been incurred and the amount of the expense. The Plan Administrator may, to the extent provided by law, rely on information provided 1162806v3 14 by Participants. Such claims must be submitted within such time periods as the Plan Administrator may reasonably require. Section 8.6 Reimbursement of Expense. The Employer shall reimburse the Participant for Health Expenses incurred during a Period of Coverage if the Participant submits the documentation required under Section 8.5. An amount up to the Participant's total Election for the Plan Year (reduced as of any particular time for prior reimbursements for the same Period of Coverage) shall be available for reimbursement at all times during the Plan Year. The Plan may not make advance reimbursements of future or projected expenses. Claims for reimbursement shall be paid at least monthly, or when the total amount of claims to be paid reaches a reasonable minimum designated by the Plan Administrator, such as $50. However, if a minimum amount is specified, that amount will not be applicable for the final processing cycle of the Plan Year or other interim processing cycles as determined by the Plan Administrator. Section 8.7 Maximum Reimbursement. The maximum reimbursement which a Participant may receive for a Plan Year under this Article VIII shall be the amount designated in the Summary Pages for health care reimbursement. Section 8.8 Revocation of Election. Ifa Participant revokes an Election during the Plan Year as a result of a change in status or separation from service, the Employer shall reimburse the Participant for any amount previously prepaid or contributed in advance to the Optional Benefit on the Participant's behalf for coverage relating to a period after the date of such Election revocation, regardless of the Participant's claims or reimbursements as of that date. ARTICLE IX: DEPENDENT CARE REIMBURSEMENT Section 9.1 Applicability of this Article. The terms of this Article IX apply only to the extent that the Employer has adopted the Dependent Care Reimbursement Optional Benefit in Section 2.15(c) in the Summary Pages. The term "Election" as used in this Article IX refers to the Election made by a Participant pursuant to Article IV, to receive Optional Benefits described in such Section 2.15(c). Section9.2 Purpose. ThepurposeoftheDependentCareReimbursementOptionalBenefit described in this Article is to provide Participants with the option of being reimbursed for eligible Dependent Care Expenses. The Dependent Care Reimbursement Optional Benefit is intended to qualify as a dependent care assistance program under Section 129 of the Code so that payments received pursuant to this Article and the Plan are excludable from the gross income of the Participant under Section 129(a) of the Code. Section 9.3 Definitions. (a) Dependent Care Expense means the amount paid or incurred by the Participant for expenses for the care of a Qualifying Dependent vr for related household services, 1162806v3 15 (h) (c) (d) but only if such expenses were incurred to enable the Participant (and spouse, if applicable) to be Gainfully Employed during the period in which the expenses were incurred. Expenses for services delivered outside of the Participant's home for a Qualifying Dependent described in Section 2.22(b) shall be Dependent Care Expenses only if such Qualifying Dependent regularly spends at least eight (8) hours per day in the Participant's household. Expenses shall be considered incurred on the date services are provided. Eligible expenses do not include: amounts paid for food, clothing or educational expenses for a child in kindergarten or higher grade; or expenses for services at a camp where the Qualifying Dependent stays overnight. Eligible expenses do not include amounts paid to: 1) A dependent care facility or person providing care for more than six (6) nonresident individuals which does not comply with all applicable laws and regulations of the state or local government in which it is located; or 2) A child of the Participant under the age of nineteen (19) at the close of the Plan Year; or 3) Any other individual which the Participant or the Participant's spouse may claim as a dependent under Section 151 (c) of the Code. Gainfully Employed means the earning of income which is not nominal reimbursement for volunteer work, or the period of active search for gainful employment. A Highly Compensated Employee for purposes of applicable nondiscrimination requirements of Section 129 of the Code for Dependent Care Reimbursement under Article IX means an employee who is highly compensated as defined in Section 414(q) of the Code. Qualifying Dependent means any individual who is: 1) A child of the Participant under the age of thirteen (13) and for whom the Participant is entitled to an exemption under Section 151 (c) of the Code, or 2) A dependent or spouse of the Participant who is physically or mentally incapable of self-care. 3) Where the parents are divorced, legally separated or separated under a written separation agreement, a child (as defined in Section 151 (c)(3) of the Code) who: i) is under age thirteen (13) or is physically or mentally incapable of self-care, 1162806v3 16 ii) receives over half of his or her support during the calendar year from his or her parents who are divorced or legally separated under a decree of divorce or separate maintenance or who are separated under a written separation agreement, and iii) is in the custody of one or both of his or her parents for more than one-half of the calendar year, is treated for any taxable year beginning in the calendar year as a Qualifying Dependent of that parent who has custody for a longer period during the calendar year than the other parent. Accordingly, a child may be treated as the Qualifying Dependent of a parent even though that parent is not entitled to a dependency exemption under Section 152 of the Code for the child. Only one parent may treat the child as a Qualifying Dependent. Section 9.4 Dependent Care Account. The Employer will establish and maintain for record keeping purposes a Dependent Care Account for each Plan Year for each Participant from whom an Election is received. The account will be increased as of each date compensation is paid to the Participant with an mount equal to the allocation, if any, which the Participant has elected. A Participant's Dependent Care Account will be decreased from time to time in the amount of payments made to the Participant for Dependent Care Expenses incurred during the Period of Coverage. All amounts added to a Dependent Care Account remain the property of the Employer until distributed to the Participant in accordance with this Article IX. Section 9.5 Claims for Reimbursement. A Participant who has made an Election for a Period of Coverage may apply to the Plan Administrator for reimbursement of Dependent Care Expenses incurred during such Period of Coverage by executing and submitting a claim form which the Plan Administrator prescribes setting forth: (a) The amount, date and nature of the expense, (b) The name of the person or entity providing the services, and if different, the name of the person or entity to which the expense was paid, (c) The Participant's statement that the expense has not been reimbursed or is not reimbursable from any other source, and (d) Such other information as the Plan Administrator may require. Such claim form shall be accompanied by bills, invoices, receipts, or other statements from an independent third party stating the Dependent Care Expense has been incurred and the amount of the expense. The Plan Administrator may, to the extent provided by law, rely on information provided by Participants. 1162806v3 17 Section 9.6 Reimbursement of Expense. The Employer shall reimburse the Participant from the Participant's Dependent Care Account for Dependent Care Expenses incurred during the Period of Coverage for which the Participant submits the documentation required under Section 9.5. Inno case shall a payment be made which exceeds the balance in the Participant's Dependent Care Account at the time reimbursement is requested. The Plan may not make advance reimbursements of future or projected expenses. Such claims must be submitted within such time periods as the Plan Administrator may reasonably require. Claims for reimbursement shall be paid at least monthly, or when the total amount of claims to be paid reaches a reasonable minimum designated by the Plan Administrator, such as $50. However, if a minimum amount is specified, that amount will not be applicable for the final processing cycle of the Plan Year or other interim processing cycles as determined by the Plan Administrator. Section 9.7 Maximum Reimbursement. The maximum reimbursement which a Participant may receive in a tax year under this Article IX shall be the least of: (a) The Participant's earned income for the tax year; (b) The actual or deemed earned income of the Participant's spouse for the tax year; or (c) $5,000, or in the case of a Participant who is married and filing a separate income tax return form his or her spouse, $2,500. In the case of a spouse who is a full-time student, or is physically or mentally incapable of self-care, such spouse shall be deemed to have earned income of $200 per month if the Participant has one Dependent and $400 per month if the Participant has two or more Dependents. ARTICLE X: ADMINISTRATION Section 10.1 Plan Administrator. The Employer is hereby designated as the Plan Administrator. The Employer may delegate in writing its duties under the Plan to one or more officers or employees, or to individuals or entities independent of the Employer. Section 10.2 Powers of the Plan Administrator. The Plan Administrator shall have sole and complete authority necessary to administer the Plan, including but not limited to the following: (a) (b) To interpret the provisions of the Plan, decide questions of eligibility and determine amounts of benefits due under the Plan. To establish and revise the method of accounting for the Plan and to maintain the accounts. (c) To establish rules and prescribe any forms necessary or desirable for the administration of the Plan. 1162806 v3 18 Except as provided in Section 10.6, the Plan Administrator shall have no power to add to, subtract from or modify any of the terms of the Plan, or to change or add to any benefits provided by the Plan, or to waive or fail to apply any requirements of eligibility for a benefit under the Plan. Section 10.3 Actions of the Plan Administrator. All determinations, interpretations, rules and decisions of the Plan Administrator shall be conclusive and binding upon all persons having or claiming to have any interest or right under the Plan. All decisions and actions by the Plan Administrator shall be applied uniformly and consistently to all Participants so that all persons similarly situated will receive substantially the same treatment. Section 10.4 Information to be Furnished. Participants shall provide the Plan Administrator with such information and evidence, and shall sign such documents as may reasonably be requested from time to time for the purpose of administration of the Plan. The Plan Administrator may, to the extent provided by law, rely on information provided by Participants. Section 10.5 Nondiscrimination. The Plan shall not discriminate in favor of Highly Compensated Employees as to eligibility to participate. Optional Benefits provided to Key Employees under the Plan shall not exceed 25% of the aggregate of such benefits provided for all Participants in any Plan Year. In addition, Optional Benefits shall comply with any nondiscrimination rules which apply to those plans separately. Specifically, (a) if the Employer has adopted the Health Care Reimbursement Plan described in Article VIII, the benefits provided pursuant to such Article VIII shall not discriminate in favor of Highly Compensated Employees as to eligibility to participate or benefits and shall meet the discrimination tests of Section 105(h) of the Code; and (b) if the Employer has adopted the Dependent Care Reimbursement Plan described in Article IX, not more than 25% of the amounts paid by the Employer for dependent care assistance during the Plan Year shall be provided to Participants who are shareholders or owners (or their spouses or dependents) of more than 5% of the stock or of the capital or profit interest in the Employer. Benefits provided under Article IX shall not discriminate in favor of Highly Compensated Employees or their Dependents with respect to eligibility, contributions or benefits. The average dependent care reimbursement paid pursuant to Article IX to non- highly compensated employees for Dependent Care Expenses shall be at least 55% of the average Dependent Care Expenses paid to Highly Compensated Employees. If the Plan fails any of the requirements of this Section 10.5, benefits provided under the Plan will become taxable to Highly Compensated and Key Employees to the extent required by law. Section 10.6 Changes by Administrator. If the Plan Administrator determines, before or during any Plan Year, that the Plan may fail to satisfy for the Plan Year any nondiscrimination requirement imposed by the Code or any limitation on benefits provided to Key Employees, the Plan Administrator may reject or reduce Elections by Highly Compensated Employees or Key Employees with or without the consent of such employees. 1162806v3 19 Any limitation imposed by the Plan Administrator shall apply on a uniform basis pursuant to rules applicable equally to all Participants who are Highly Compensated Employees or Key Employees. To the extent practicable, such adjustments shall be made before the commencement of the Plan Year for which the Election is effective. Section 10.7 Reporting and Disclosure. Promptly after the Plan, or any Optional Benefit thereunder, is adopted, the Plan Administrator will notify all Qualified Employees of the availability and terms of the Plan. The Plan Administrator shall be responsible for complying with all reporting, filing and disclosure requirements for the Plan. If the Employer has adopted a Dependent Care Reimbursement Plan pursuant to Article IX, on or before January 31, the Plan Administrator will furnish each Participant who has received payments under Article IX with a written statement showing the amount of Dependent Care Expenses reimbursed by the Plan for the previous calendar year. The Plan Administrator will provide required information on the applicable Treasury Form W-2. Section 10.8 Indemnification of the Administrator. Any individual acting in the capacity of Plan Administrator shall be indemnified by the Employer against any and all liabilities arising by reason of any act or failure to act made in good faith pursuant to the provisions of the Plan, including expenses reasonably incurred in the defense of such claim. ARTICLE XI: MISCELLANEOUS Section 11.1 Amendment and Termination. The Employer may amend or terminate the Plan, or any Optional Benefit offered thereunder, at any time by a duly adopted resolution of its Board of Directors or written instrument executed by its President. Unless otherwise specifically provided, amendments shall be only prospective in impact. No amendment or termination shall deprive a Participant of any benefits to which he or she is entitled under this Plan with respect to contributions previously made. Section 11.2 Plan Not a Contract of Employment. The Plan is not an employment agreement and does not assure the continued employment of any employee or Participant for any period of time. Nothing contained in the Plan shall interfere with the Employer's right to discharge an employee or Participant at any time, regardless of the effect such discharge will have upon that individual as a Participant in this Plan. Section 11.3 Funding. The Plan provides a means of making Elections concerning Optional Benefits but has no assets per se. Nothing contained in the Plan shall require the Employer to maintain a separate fund or trust for the benefit of Participants unless otherwise required by law. No Participant shall, by virtue of this Plan, have any fight or interest in the assets of the Employer. A Participant has only an unsecured contract right to receive benefits in accordance with the Plan. 1162806 v3 20 Section 11.4 No GuaranteeofTax Consequences. The Employermakesno commitment or guarantee that any amounts paid to a Participant under any Article of this Plan will be excludable from the Participant's gross income for federal or state income tax purposes. It shall be the obligation of each Participant to determine whether each payment is excludable from the Participant's gross income for federal and state income tax purposes, and to notify the Employer if the Participant has reason to believe that any such payment is not so excludable. Any Optional Benefit provided to a Participant that is includable in the Participant's gross income shall be treated as if it were a distribution of cash under this Plan. Section I 1.5 Plan Benefits May Not be Assigned. No Participant may assign, pledge, or otherwise dispose of any benefit under the Plan prior to actual receipt thereof. Section 11.6 Governing Law. This Plan shall be construed and enforced according to the laws the jurisdiction named in the Summary Pages except to the extent preempted by federal law. Elf. June 2000 1162806 v3 21 SUMMARY PAGES Definitions Employer: City of Columbia Heights Optional Benefits means those components checked below: X Premium Conversion as described in Article VII X Health Care Reimbursement as described in Article VIII X Dependent Care Reimbursement as described in Article IX Effective Date: January 1,2001 Plan Year: X __ Period beginning on the Effective Date and ending on the subsequent December 31 and the 12 month period ending on each December 31 thereafter. Period beginning on and ending on the subsequent the 12 month period ending on each thereafter. and Eligibility and Waiting Periods The following employees are eligible to participate in the Plan. New employees may begin participation on the new employee Mid-Year Entry Date. (Check all that apply.) X Permanent full-time employees. X Permanent part-time employees. X Mayor and City Council members X Eligible employees as indicated above are eligible to participate in all Optional Benefits adopted by the Employer to be included in the Plan. The following employee classifications are eligible for only the following Optional Benefits adopted by the Employer to be included in the Plan. Premium Conversion Health Care Reimbursement Dependent Care Reimbursement The Mid-Year Entry Date for a new employee is: X First day of the month following ( ) days of service as a Qualified Employee Other: Date of hire. 1162795 v4 The Mid-Year Entry Date for a Participant with a Change in Status as defined in Section 6.2(c) or returning from a FMLA or Userra Leave is: X First day of the payroll period First day of the month First day of employment as a Qualified Employee Other: Date election is received by the administrator. Leased Employees The term "Qualified Employee" in Section 2.21 Shall X Shall not include Leased Employees, meaning any person who is an employee of the Employer and who provides services to an Employer where: 1) such services are provided pursuant to an agreement between an Employer and any other person (leasing organization); 2) such person has performed such services for the Employer on a substantially full time basis for a period of at least one year pursuant to Code Section 414(n)(2); and 3) such services are performed under primary direction or control by the recipient. Salary Reduction Contributions Maximum Salary Reduction Contribution: $7,600 plus the amount required to fully pay the Participant's share of the cost for benefits under any Premium Conversion Optional Benefit available through the Plan. Other: Maximum Health Care Reimbursement in any Plan Year: $2,600 Minimum Health Care Reimbursement in any Plan Year: $260 Minimum Dependent Care Reimbursement in any Plan Year: $260 Elective Employer Contributions Benefit Credits available under Section 4.2 (check all that apply): X No Benefit Credits are available under the Plan. Benefits under the Plan are provided solely through a combination of non-elective Employer contributions and Salary Reduction contributions. Only employees who waive coverage under the Employer sponsored medical plan are eligible to receive Benefit Credits. Employees can waive coverage under the Employer sponsored medical plan only upon providing written proof to the Plan Administrator of coverage under another group health plan. 1162795 v4 The following employee groups are eligible to receive Benefit Credits under the Plan: Full-time/salaried/exempt/corporate/ average of at least __ hours per __ Part-time/hourly/non-exempt/. of at least __ hours per Only non-bargaining unit employees as indicated above. Bargaining unit employees are not eligible to receive Benefit Credits. Bargaining unit employees are eligible to receive Benefit Credits. employees working an employees working an average Benefit Credits are provided in the following annual amounts: Full-time/salaried/exempt/corporate/ employees Part-time/hourly/non-exempt/. employees Benefit Credits will be applied by the Employer to offset the cost of Elected Optional Benefits in the following order: Excess Credits Excess Credits (Benefit Credits in excess of a Participant's cost for Optional Benefits elected pursuant to Article VI) will be provided to the Participant as additional taxable cash Compensation. In equal amounts on each paycheck Other: Excess Credits will be forfeited by the Participant and are not available as additional taxable cash Compensation. Excess Credits will be allocated by the Employer to reduce the cost of deemed elections under Section 6.4. Excess Credits remaining after deemed elections under Section 6.4 will be forfeited by the Participant Participation During Unpaid Leave (Section 3.4) A Participant on an unpaid leave of absence (including an FMLA Leave or USERRA Leave), may choose to pay for Optional Benefits elected under any of the options checked below (select all that apply): PRE-PAY: Paying pre-tax before the leave begins the amounts that will become due during the leave out of payroll checks; X AFTER-TAX PAY AS YOU GO: Remitting after-tax payments to the Employer on or before each pay period during the leave, with all delinquent payments to be made within thirty (30) days of their due date; 1162795 ¥4 3 X __ PRE-TAX PAY AS YOU GO: Pre-tax salary reduction contributions from payments to the Participant (i.e., sick pay, wage continuation, short term disability benefits or vacation pay) during the leave; or PAY ON RETURN: From paychecks following the leave on a pre-tax basis. Participant must make up all amounts owing for Plan Year and must elect this payment option before the Unpaid Leave commences. Safe Harbor Rules Related to Re-Employment (Section 6.2(c)) X X __ Participant who returns to work within 30 days of termination will be allowed to resume the Participant's original election. __ Participant who returns to work more than 30 days after termination will be treated as having a change in status and have the option of resuming the original election or making a brand new election. Participants who return to work may not resume the original election and may not participate n plan for the rest of plan year. Deemed Elections Deemed Election to be applied in Section 6.3 (check all that apply): X Participant deemed to have elected to receive his full Compensation in cash. Participant deemed to have elected to receive the same Premium Conversion election as existed on the last day of the immediately preceding Period of Coverage, if applicable. Participant deemed to have elected the following coverage under Employer sponsored accident and health, disability and group term life benefits: Employee only medical coverage Other: There are no deemed Elections for the Health Care Reimbursement or Dependent Care Reimbursement Optional Benefits. 1162795 v4 4 Governing Law Jurisdiction: X Minnesota Other: City of Columbia Heights Date of Execution By Its I 162795 v4 5 CITY OF COLUMBIA HEIGHTS FLEXIBLE BENEFIT PLAN SUMMARY PLAN DESCRIPTION January 1, 2001 1162803 v3 TABLE OF CONTENTS INTRODUCTION ......................................................................................................................... 1 ELIGIBILITY ................................................................................................................................ 1 CONTRIBUTIONS: SALARY REDUCTION ............................................................................ 1 Social Security Impact ....................................................................................................... 1 PREMIUM CONVERSION .......................................................................................................... 1 HEALTH CARE REIMBURSEMENT ......................................................................................... 2 Accounts ............................................................................................................................ 3 Requesting Reimbursement ............................................................................................... 3 Claim Denial ...................................................................................................................... 4 Statement of Rights of Participants ................................................................................... 4 COBRA Continuation Notice ........................................................................................................ 5 Very Important Notice ....................................................................................................... 5 DEPENDENT CARE REIMBURSEMENT ................................................................................. 8 Accounts ............................................................................................................................ 9 Requesting Reimbursement ............................................................................................. 10 Claim Denial .................................................................................................................... 10 ENROLLMENT AND ADMINISTRATION ............................................................................. 10 Election Process ............................................................................................................... 10 Election Changes ............................................................................................................. 11 Unpaid Leave of Absence ................................................................................................ 13 Termination ...................................................................................................................... 14 GENERAL iNFORMATION ...................................................................................................... 15 DEFiNITIONS ............................................................................................................................. 16 1162803 v3 INTRODUCTION Many employees don't view their benefits as compensation. They see pay and benefits as two separate programs. Actually, your pay and benefits together form your total compensation. With the Flexible Benefit Plan, you receive more choices in your benefit program and more flexibility in how your total compensation is allocated between pay and benefits. The Plan allows you to elect certain optional nontaxable benefits as alternatives to cash compensation that would be taxable. As a result, your total compensation is delivered more tax effectively. ELIGIBILITY Employees are not automatically eligible for the Flexible Benefit Plan, although only employees who earn compensation from the Employer may participate. The Definitions section at the end of this document describes which employees are Eligible Employees and the applicable Waiting Period before participation for newly hired employees begin. Owner-employees (including partners, if applicable) are not eligible to participate. If the Employer is organized as a subchapter S corporation, shareholders of the Employer are not eligible to participate. CONTRIBUTIONS: SALARY REDUCTION The Flexible Benefit Plan allows you to elect to have a portion of your pay set aside (before any taxes have been deducted) to be applied to the payment of your share of the cost for the Optional Benefits you select. The legal term for this process is "salary reduction". The advantage is that it reduces your federal and state income taxes and social security taxes (FICA). The maximum amount of salary reduction allowable in any Plan Year is shown in the Definitions section at the end of this document. Social Security Impact It should be noted that because the amount of your salary reduction is not subject to FICA taxes, it is also not included in determining your average wages for Social Security benefit purposes. For example, if you reduce your salary in one year from $20,000 to $18,000 through use of this Plan, the salary included in your Social Security wage history for that year would be $18,000 rather than $20,000. The exact effect this will have on your Social Security benefits is based on your pay history throughout your working career, your marital status, and other factors. One potential effect is that your Social Security benefits may be reduced. PREMIUM CONVERSION This Optional Benefit allows you to use before-tax dollars to pay the employee share of the premiums for certain employer-sponsored insurance plans. The available plans are listed in the Definitions section at the end of this document. If you decide to use this option, your portion of premiums will be deducted from your pay before taxes. Your share of the cost will be determined annually by the Employer. If there is a change in your share of the cost of a health plan because of a change in the premium charged by the insurance company, the amount of salary reduction will be adjusted automatically. 1162803 v3 1 HEALTH CARE REIMBURSEMENT If you elect to participate in the Health Care Reimbursement Optional Benefit, contributions you designate will be credited to a bookkeeping account on your behalf. This account will be used to reimburse you for eligible health care expenses for you and your dependents which are not reimbursed by insurance. You may use your Health Care Reimbursement Account to be reimbursed for most of the "out-of- pocket" expenses you incur for medical care. Allowable expenses for medical care would include: · Medical and dental expenses which are covered but not paid by insurance (deductible amounts paid before benefits begin and the percentage of charges not covered) Vision and hearing expenses including examinations, eyeglasses, contact lenses, hearing aids and seeing-eye dogs · Fees paid to doctors, chiropractors and hospitals · Dental care including orthodontia · Routine physical examinations, x-rays and lab fees · Prescription drugs including insulin and birth control pills · Special equipment bought or rented because of a physical problem (wheelchairs, crutches, orthopedic shoes, etc.) · Ambulance service and other transportation costs necessary to receive medical care · Other expenses which would otherwise qualify as legitimate medical care deductions for federal income tax purposes excluding premiums you pay for health insurance Medical expenses that are reimbursed by insurance, insurance premimns, and expenses for long term care are not eligible. Expenses for which you are reimbursed through your Account may not be claimed as deductions for income tax purposes. Insurance premiums your spouse pays through his/her employer will not be reimbursed through this account. The maximum amount you may elect for the Health Care Reimbursement Optional Benefit is shown in the Definitions section at the end of this document. The amount available for reimbursement is limited to the amount that you designated as your contribution for the Plan Year and is not limited to contributions which have been made to your Account at the time of reimbursement. You may submit requests for reimbursement up to 90 days following the end of the Plan Year. 1162803 v3 2 If your employment terminates, or you take an unpaid leave of absence, eligible expenses incurred prior to your separation will be reimbursed up to the amount remaining of your annual election. Eligible expenses incurred after your separation will be reimbursed only if you elect to continue contributions and benefits. Your rights to legally mandated continuation coverage are described in the COBRA Continuation Notice found at the end of the section. The Employer may also allow continuation coverage for participants, even if it is not legally mandated. A description of the Employer's specific policy is contained in the General Information section of this document. Regardless of the Employer's policy, if you elect to continue benefits you must, make the required payments in a timely manner. If you take an unpaid leave of absence under the provisions of the Family and Medical Leave Act ("FMLA"), and do not return to employment following the end of the leave, your coverage wilt terminate at the end of the FMLA leave. At that time, you may have the right to continue benefits as described in the COBRA Continuation Notice found at the end of this section. If your leave of absence is due to a period of duty in the Uniformed Services of the United States and lasts more than 31 days, you may also continue this coverage. ACCOlltlts Each time you are paid, contributions you allocate for health care reimbursement go into a Health Care Reimbursement Account on your behalf. Note that the Account is for bookkeeping purposes only; no money is actually held in the Account. You may submit claims incurred during a Plan Year for up to 90 days after the end of the Plan Year. Any balance remaining in your Account after this date cannot be paid to you or carried forward into the next Plan Year. You should, therefore, carefully anticipate your needs for the year before determining the amount of your election. These forfeitures will be used to offset the reasonable administrative expenses of the Flexible Benefit Plan. Requesting Reimbursement In order to be reimbursed, eligible expenses must have been incurred during the Plan Year while you are a participant in the Health Care Reimbursement Optional Benefit. Expenses are considered incurred on the date the services were provided. You may not receive advance reimbursement for future or projected expenses. Claims will be reimbursed up to the full amount of your election, reduced by previously paid claims. To be reimbursed for health care expenses, you must first submit the expenses to your insurance company to obtain whatever reimbursement is available from that source. Then submit eligible expenses for reimbursement from your Account as follows: A claim form and documentation must be submitted showing the amount, date and nature of the expense and the name of the provider. You must include bills, invoices, receipts, or other statements from an independent third party verifying expenses. 1162803 v3 3 Requests for reimbursement may be submitted for up to 90 days following the close of the Plan Year in which the expenses are incurred. You will be reimbursed directly. Payments will not be made to providers. Your Employer does not guarantee that the amounts reimbursed through this Account will be excludable from gross income for federal or state income tax purposes. It is your responsibility to determine whether or not each payment you receive is a qualified excludable expense. You may wish to consult a tax advisor for assistance. Claim Denial If your claim for reimbursement is denied, you will receive notice in writing, stating the specific reasons for the decision. If you do not agree with the decision, you can request that the decision be reviewed by filing a written request with the Plan Administrator for review within 60 days after receiving notice that the claim has been denied. You can also present statements which explain why you believe the benefit claim should be paid. Generally, the Plan Administrator will review its decision within 60 days after receiving a request for review. However, if special circumstances require a delay, and the Plan Administrator so notifies you, the review may take up to 120 days. The Plan Administrator will give you written notice of a final decision. If the Plan Administrator does not issue a decision within the time limits described above, you may deem your claim to have been denied. Statement of Rights of Participants As a participant in the Health Care Reimbursement Optional Benefit, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all participants shall be entitled to: Examine, without charge, at the Employer's office all Plan documents and copies of all documents filed by the Plan with the U.S. Department of Labor, such as annual reports and Plan descriptions. 2. Obtain copies of all Plan documents and other Plan information upon written request to the Employer. A reasonable charge may be made for the copies. 3. Receive a summary of the Plan's annual financial report. In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate your Plan, called "fiduciaries" of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one may fire you or otherwise discriminate against you in any way to prevent you from obtaining a benefit or exercising your rights under ERISA. If your claim for a benefit under this Plan is denied in whole or in part, you must receive a written explanation of the reason for the denial. You have the right to have the Employer review and reconsider your claim. 1162803 v3 4 Under ERISA there are steps you can take to enforce the above rights. For instance, if you request materials from the Plan and do not receive them within 30 days, you may file suit in a federal court. In such a case, the court may require the Employer to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond its control. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or federal court. If it should happen that Plan fiduciaries misuse the Plan's money, if any, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in federal court. The court will decide who should pay costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous. If you have any questions about the Health Care Reimbursement Optional Benefit, you should contact the Plan Administrator. If you have questions about this statement or about your rights under ERISA, you should contact the nearest office of the Pension and Benefits Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20210. COBRA Continuation Notice IZery Important Notice Federal law requires that most employers sponsoring group health plans offer employees and their families the opportunity for a temporary extension of health coverage (called "continuation coverage") in certain instances where coverage under the plan would otherwise end. This notice is intended to inform you, in a summary fashion, of your rights and obligations under the continuation coverage provisions of the law. You and your spouse should take the time to read this notice carefully. As an employee electing to participate in the Health Care Reimbursement Optional Benefit, you may have a right to choose this continuation coverage if you lose your coverage because of a reduction in hours of employment or the termination of your employment (for reasons other than gross misconduct on your part), or if you are a retiree, because your employer has filed for Chapter 11 reorganization. If you are the spouse of an employee covered by the Health Care Reimbursement Optional Benefit, you may have the right to choose continuation coverage under the plans for any of the following four reasons: 1162803 v3 5 1) The death of your spouse; 2) The termination of your spouse's employment (for reasons other than gross misconduct) or reduction in your spouse's hours of employment with the Employer; 3) Divorce or legal separation from your spouse; or 4) Your spouse becomes enrolled for Medicare benefits. In the case of a dependent child of an employee covered by the Health Cam Reimbursement Optional Benefit, he or she may have the right to continuation coverage if coverage is lost for any of the following five reasons: 1) Death of a parent; 2) The termination of a parent's employment (for reasons other than gross misconduct) or reduction in parent's hours of employment with the Employer; 3) Parents' divorce or legal separation; 4) A parent becomes enrolled for Medicare benefits; or 5) The dependent ceases to be a "dependent child" under the Flexible Benefit Plan. For purposes of the above continuation provisions, dependent child includes a child bom to, adopted by or placed for adoption with the covered employee during the period of continuation coverage provided that the covered employee has elected continuation coverage. Under the law, the employee or a family member has the responsibility to inform the Employer of a divorce, legal separation, a child losing dependent status or Medicare enrollment under the Health Cam Reimbursement benefit within 60 days of the qualifying event. The Employer will be aware of the employee's death, termination of employment or reduction in hours without notice from the employee. When the Employer is notified or becomes aware that one of these events has happened, the Employer will in mm notify you that you have the right to choose continuation coverage. Under the law, you have 60 days from the date you would lose coverage because of one of the events described above (or 60 days from the date you are provided with your continuation notice, if later) to inform the Employer that you want continuation coverage. You will have the right to continuation coverage in the event that the maximum amount of your required continuation payment for the remainder of the Plan Year does not exceed the maximum amount that you may receive in reimbursements from your health care reimbursement account for the remainder of the Plan Year. You may also have the right to continuation coverage simply by 1162803 v3 6 virtue of your participation in the Health Care Reimbursement Optional Benefit, regardless of the amount remaining in your health care reimbursement account, if the Employer has adopted such a policy. The policy adopted by your Employer is shown in the General Information section of this document. The monthly cost for continuation coverage is one-twelfth of your election to the Health Care Reimbursement Optional Benefit plus a two percent administrative surcharge. For example, if you elected $600, your monthly continuation cost would be $51.00 [(600/12) x .02]. The Employer will provide you with the appropriate cost information if you become eligible for continuation coverage. If you do not choose continuation coverage, your Health Care Reimbursement coverage will end. If you choose continuation coverage, the Employer is required to give you coverage which, as of the time coverage is being provided, is identical to the coverage provided for Health Care Reimbursement benefits to similarly situated employees or family members. Each person eligible for continuation coverage may elect that coverage separately, and may change your election during the Flexible Benefit Plan open enrollment period. However, the law also provides that your continuation coverage may be cut short for any of the following reasons: 1) The Employer no longer provides health care reimbursement benefits to any of its employees; 2) The premium for your continuation coverage is not paid in a timely fashion; 3) You become enrolled in Medicare; or 4) You elect this continuation coverage and then you become covered under another health care reimbursement plan which does not contain any exclusion or limitation with respect to a pre-existing condition that applies to you. You do not have to show that you are insurable to choose continuation coverage. However, under the law, you may have to pay a premium for your continuation coverage. The first payment will be due within 45 days after the date you initially elected continuation coverage. Thereafter, payments will be due on the first day of each month, and coverage will terminate on the due date if payment is not received within 30 days after the due date. If you have any questions about the law, please contact the Employer at the address shown on the General Information page at the end of this document. Also, if you have changed marital status, or you or your spouse have changed addresses, please notify the Employer at this same address. 1162803 v3 7 You may also have rights under state law to continuation coverage under medical, dental and group term life insurance plans offered by the Employer, if any. Please see the medical, dental and group term life insurance plan Summary Plan Description(s) for more detailed information. DEPENDENT CARE REIMBURSEMENT If you elect to participate in the Dependent Care Reimbursement Optional Benefit, contributions you designate will be credited to a bookkeeping account on your behalf. Expenses for dependent care that are considered employment-related expenses are eligible for reimbursement from your Account. Eligible dependent care expenses are those costs which you incur for care of your dependents (i.e. day care) that enable you, and your spouse if you are married, to work. If you are married, your spouse must be gainfully employed, a full-time student, or incapable of self-care. Eligible dependents are: · your dependent children under age 13; or a spouse or another dependent whose principal residence is your home, who is dependent on you for more than half of his or her support and who is mentally or physically unable to care for himself or herself. Your eligible dependents may receive care from a babysitter, dependent care center or someone who comes to your home. However, expenses for care of a dependent outside the home am eligible only if the qualifying individual normally spends at least 8 hours per day in your household. If you utilize a care provider which cams for more than six nonresident persons, the care provider must be licensed and comply with all applicable state and local laws. The types of expenses which are not reimbursable include care which is primarily educational or medical in nature, education at the kindergarten level or higher, the cost of transportation to and from the care facility and anyportion of the cost for overnight camp. Household service expenses for food, clothing or entertainment (unless they are incidental to cam) are not eligible. Also, services provided by your child under age 19 (or someone you can claim as a dependent on your tax return) are not reimbursable. The maximum reimbursement you can get from your Dependent Care Reimbursement Account is $5,000 per Plan Year. This will be paid to you on a pre-tax basis (without income tax or FICA tax withholding). However the tax benefit from these reimbursements is subject to limitations. You will be required to declare on your income tax return the amount of reimbursement, if any, that exceeds certain limits that are imposed by the tax laws. For example, the maximum reimbursement in a calendar year is $5,000, or $2,500 if you are married and file a separate return. In addition, your tax-free amount may not be more than whichever of the following limitations apply to you: · If you are single, your earned income (after salary reduction) for the year the expenses were incurred; or 1162803 v3 If you are married and your spouse is working, your earned income (after salary reduction), or the earned income of your spouse, whichever is less, for the year the expenses were incurred. For purposes of applying the earned income limit, earned income generally means income from employment (such as wages, salaries, tips, etc.). If you are married and your spouse is either a full- time student or is physically or mentally incapable of caring for himself or herself, you must assume an earned income of no more than $200 in any one month if you have only one qualified dependent, or $400 in any one month if you have more than one qualified dependent. If your employment terminates or you take an unpaid leave of absence, you may submit requests for reimbursement of dependent care expenses incurred during the Plan Year up to 90 days following the close of the Plan Year, provided however that the dependent care expenses were incurred before the last day of the Plan Year. Eligible dependent care expenses incurred after your separation but before the end of the Plan Year will be reimbursed up to the amount remaining in your Account. Note that you cannot claim a Federal Dependent Care Tax Credit on your income tax return for dependent care expenses reimbursed from this Account. Also, amounts reimbursed through this Account will reduce, dollar for dollar, the maximum expenses available for determining the tax credit. In general, the Dependent Care Tax Credit allows you to reduce the amount of federal income taxes you owe by giving you a credit against your tax liability. The amount of the credit is a pement of eligible dependent care expenses. The percentage varies from 20% to 30% depending on your adjusted gross income. The amount of eligible expenses toward which the credit can be applied is limited to the lesser off 1) $2,400 for one child ($4,800 for two or more children), or 2) the earned income of the lower earning spouse. In certain cases, it may be more advantageous for you to claim a tax credit for your dependent care expenses rather than pay for those expenses through a dependent care reimbursement account. As a role of thumb, if your family income is less than $24,000 and your expenses are less than $2,400 per year for one child or $4,800 for two or more children, the tax credit will be more beneficial. You may want to consult your tax advisor. Finally, you should be aware that you will be required to report the name, address and tax identification number of your dependent care provider on your tax return if you use either the tax credit or the Dependent Care Reimbursement Optional Benefit. Accounts Each time you are paid, contributions you allocate for dependent care reimbursement go into a Dependent Care Reimbursement Account on your behalf. Note that the Account is for bookkeeping purposes only; no money is actually held in the Account. You may submit claims incurred during a Plan Year for up to 90 days after the end of the Plan Year. Any balance remaining in your Account after this date cannot be paid to you or carried forward into the next Plan Year. You should, therefore, carefully anticipate your needs for the year before 1162803 v3 9 determining the amount of your election. These forfeitures will be used to offset the reasonable administrative expenses of the Flexible Benefit Plan. Requesting Reimbursement In order to be reimbursed, eligible expenses must have been incurred during the Plan Year and after your election for dependent care reimbursement benefits is effective. Expenses are considered incurred on the date the services were provided. You may not receive advance reimbursement for future or projected expenses. Claims will be reimbursed up to the balance in your Account at the time reimbursement is requested. You may submit eligible expenses for reimbursement from your Account as follows: A claim form and documentation must be submitted showing the amount, date and nature of the expense and the name of the provider. You must include bills, invoices, receipts, or other statements from an independent third party verifying expenses. · Requests for reimbursement may be submitted for up to 90 days following the close of the Plan Year in which the expenses are incurred. You will be reimbursed directly. Payments will not be made to providers. Your Employer does not guarantee that the amounts reimbursed through this Account will be excludable from gross income for federal or state income tax purposes. It is your responsibility to determine whether or not each payment you receive is a qualified excludable expense. You may wish to consult a tax advisor for assistance. Claim Denial If your claim for reimbursement is denied, you will receive notice in writing, stating the specific reasons for the decision. If you do not agree with the decision, you can request that the decision be reviewed by filing a written request with the Plan Administrator for review within 60 days after receiving notice that the claim has been denied. You can also present statements which explain why you believe the benefit claim should be paid. Generally, the Plan Administrator will review its decision within 60 days after receiving a request for review. However, if special circumstances require a delay, and the Plan Administrator so notifies you, the review may take up to 120 days. The Plan Administrator will give you written notice of a final decision. ENROLLMENT AND ADMINISTRATION Election Process Each year you will have the opportunity to re-enroll in the Plan. Elections do not carry forward from one year to the next. Elections must be in writing on the form provided and received prior to the first day of the period of coverage. If you fail to return the required election form, you will receive the Deemed Election shown in the Definitions section at the end of this document. 1162803 v3 10 Election Changes Once an election becomes effective, it stays in effect until the following Plan Year. You may not change your election during the Plan Year except under the following circumstances. 1) If the premium amount for a health care plan significantly increases and the Employer makes available another health plan with similar coverage, you may make a corresponding change in your salary reduction election, or revoke the election and elect to receive coverage under the other health plan. Further, if the premium amount does not increase, but your portion of the premium amount has increased, you may make a corresponding change in your salary reduction election. 2) If the coverage under a health plan is significantly curtailed or ceases and the Employer makes available another health plan or health plan option with similar coverage, you may revoke your election and elect to receive coverage under the other health plan or health plan option. A change in election may be made if there is a mid- year change in coverage of a spouse or dependent under another employer's plan due to differing open enrollment periods of the spouse's or dependent's employer plan. However, such election changes must be made on account of and corresponding to the actual election made by the spouse or dependent during the open enrollment period. 3) If you have a change in status, you may revoke your election and submit a new election which is consistent with that change for the remainder of the Plan Year. A change in status affecting a premium conversion or health care reimbursement optional benefit means any of the following: enrollments made pursuant to the special enrollment rules of the Health Insurance Portability and Accountability Act of 1996, and including the enrollment of both new and pre-existing dependents, · changes in your legal marital status (i.e., marriage, divorce, death of a spouse, legal separation or annulment), · changes in the number of your dependent children (i.e., birth or death of a dependent, adoption or placement for adoption), · termination or commencement of employment of you, your spouse or a dependent, changes in your work schedule or the schedule of your spouse or a dependent, including, changing from full-time to part-time (or vice versa), a strike, lockout or commencement or return from unpaid leave, · changes in eligibility rules for Employer-sponsored plan which results in the Participant's loss of eligibility, 1162803 v3 1 1 events which cause a dependent to satisfy or fail to satisfy the eligibility requirements of a plan, such as the dependent reaching the limiting age for coverage under a plan, or changes in the student status of the dependent, or · changes in your residence or worksite or that of your spouse or dependent (affecting medical coverage). You may revoke an election for the balance of a Plan Year and file a new election only if both the revocation and the new election are due to and consistent with the reason that such change was permitted, or if you, your spouse or dependent becomes eligible for continuation coverage under your Employer-sponsored health plan. A new election must be filed within thirty (30) days after the date of the change in status and will be effective on the Status Change date shown in the Definitions section at the end of this document. For purposes of election changes for an accident and health plan (including a health care reimbursement benefit program), consistency means that the following conditions have been met: 1) the change in status results in you, your spouse or a dependent gaining or losing eligibility under this Plan, or an accident or health plan of your spouse or dependent's employer, and 2) the election change corresponds with that gain or loss of coverage. For purposes of election changes to a group term life plan, consistency means either of the following: l) In the case of birth, adoption or placement for adoption, you can increase group term life coverage, if allowed under the provisions of the group term life plan; or 2) In the case of death of a dependent, you can decrease group term life coverage, if allowed under the provisions of the group term life plan. 3) In the case of marriage, divorce, legal separation, annulment, death of spouse or changes in your spouse's employment, you can increase or decrease group term coverage, if allowed under the provisions of the group term life plan. A change in status for a dependent care reimbursement optional benefit includes marriage or divorce, death of a dependent or spouse, birth or adoption of a child, termination or commencement of a spouse's employment, change from full-time to part-time (or vice versa) of you or your spouse, taking an unpaid leave of absence by you or your spouse, and change in cost of coverage, if imposed by someone not a relative. You may revoke an election for a dependent care reimbursement optional benefit for the balance of a Plan Year and file a new election only if both the revocation and the new election are due to and consistent with the reason that such change was permitted. A new election must be filed within 1162803 v3 12 thirty (30) days after the date of the change in status and will be effective on the Status Change date shown in the Definitions section at the end of this document. Change in status for any benefit offered under the Flexible Benefit Plan also includes other events as may be permitted under regulations and rulings of the Internal Revenue Service. 1) You may change your election under a premium conversion and/or health care reimbursement benefit if you are required to provide coverage for a child due to a court order, judgment or decree resulting from a divorce, legal separation, annulment, or change in legal custody. You may also cancel or terminate coverage for the child under these portions of the Plan if the court order or decree requires your former spouse or another person to provide coverage for the child. 2) If you, your spouse, or a dependent enrolled in an employer-sponsored medical plan or a health care reimbursement optional benefit becomes enrolled to receive Medicare or Medicaid benefits (other than coverage limited to benefits for distribution of pediatric vaccines), you may make a corresponding election change to cancel coverage for yourself, your spouse or the dependent, as applicable. Conversely, if you, your spouse, or dependent is not enrolled in an employer-sponsored plan because you were enrolled to receive Medicare or Medicaid benefits and later become ineligible for such benefits, you may make a corresponding election change to elect coverage for yourself, your spouse or your dependent. 3) Notwithstanding the consistency rule, an employee may increase the amount of Premium Conversion under Article VII to pay premiums for continuation of health care coverage under Federal or State COBRA laws. if you are a new employee, you may file an election after meeting the Waiting Period shown in the Definitions section at the end of this document. If you have been on an FMLA Leave or absent due to a period in the Uniformed Services, that leave time will count toward your satisfaction of the service requirement. New employees must make elections within 30 days of the satisfaction of the Waiting Period or they will receive the Deemed Election shown in the Definitions section. Unpaid Leave of Absence If you take an unpaid leave of absence under the Family and Medical Leave Act of 1993 ("FMLA"), at your option you may continue any or all of your benefits under the Plan as long as you make the required contributions. You have the option of making contributions in any of two ways: 1) AFTER-TAX PAY AS YOU GO: You can make after-tax payments to the Employer on or before each pay period (when contributions would have been taken). Any delinquent payments must be made within 30 days of their due date; or 1162803 v3 13 2) PRE-TAX PAY AS YOU GO: You can make pre-tax payments during your leave out of any payments you receive during your leave, such as vacation pay, sick pay, wage continuation. Payments made under option 2) will be made on a pre-tax (that is, salary reduction) basis. All salary reduction contributions must be made within the same Plan Year in which the leave began. These same options apply if your leave of absence is due to a period of duty in the Uniformed Services of the United States and that duty lasts more than 31 days. Termination The Flexible Benefit Plan has been designed to comply with all current laws regarding flexible benefit plans. The Employer may change, amend or terminate the Plan, or any portion thereof, at anytime. If the Plan is terminated, you will not lose your right to benefits accrued prior to Plan termination. Your participation in the Plan will cease upon termination of your employment or if you no longer meet the qualification requirements. This Summary Plan Description merely summarizes the benefits provided pursuant to the Plan, and is not the legally controlling document. All determinations regarding benefit entitlement and Plan provisions are based upon the actual Plan documents which are available for inspection at the office of the Plan Administrator. 1162803 v3 14 GENERALINFORMATION Name of Plan: City of Columbia Heights Flexible Benefit Plan Plan Sponsor: City of Columbia Heights 590 40th Avenue Northeast Columbia Heights, MN 55421-3878 Plan Administrator: City of Columbia Heights 590 40th Avenue Northeast Columbia Heights, MN 55421-3878 (763) 706-3609 Employer Identification Number: 41-6005069 Plan Number: 590 Type of Plan: The Flexible Benefit Plan is a cafeteria plan under Section 125 of the Internal Revenue Code, allowing a choice between cash and certain qualified benefits. The Plan is unfunded, with contributions and benefits paid out of the general assets of the Employer and therefore has no trustee. Plan Year: January 1 through December 31 Funding: Reimbursement account benefits are entirely self-funded by the Employer, through salary reduction contributions. The medical and dental insurance coverage purchased through the Premium Conversion option of this Plan is provided through insurance contracts, though the Premium Conversion benefit under this Plan is not insured. For questions or service of legal process contact the Plan Administrator at: Attn: City Manager City of Columbia Heights 590 40th Avenue Northeast Columbia Heights, MN 55421-3878 (763) 706-3610 Vers. June 2000 1162803 v3 15 Eligible Employee: DEFINITIONS A permanent full-time and permanent part-time employee of the Employer. The Mayor and City Council members may also participate. Waiting Period: Eligible Employees may begin participation on the date of hire. Maximum Salary Reduction Contribution: $7,600 plus the amount necessary to fully pay the participant's portion of the cost for benefits under the Premium Conversion Optional Benefit. Premium Conversion Plans: Participant's may elect to use Premium Conversion to pay for the cost of the following benefits: Medical and Dental. Maximum Health Care Reimbursement Account You can allocate any amount you wish to a Health Care Reimbursement Account up to a maximum of $2,600 and a minimum of $260. Health Care Reimbursement Continuation Coverage: Continuation coverage is available to all Participants and Qualified Beneficiaries in the Health Care Reimbursement Optional Benefit, regardless of account balance. Maximum Dependent Care Reimbursement Account: You can allocate any amount you wish to a Dependent Care Reimbursement Account up to a maximum of $5,000 and a minimum of $260. See the Dependent Care Reimbursement section of this document for other restrictions on the amount of this election. Deemed Election: A new Eligible Employee who fails to return the required enrollment form will be deemed to have elected to receive all of his 1162803 v3 16 compensation in cash. Any premiums will be paid on an after-tax basis; no Reimbursement Accounts will be established. Status Change: An election made as the result of a status change will be effective on the first day of the payroll period, following receipt of the election form by the Plan Administrator. However, an election change made due to a special enrollment right in the Health Insurance Portability and Accountability Act of 1996 will be effective as of the date required by that Act. 1162803 v3 17 CITY OF COLUMBIA HEIGHTS Meeting; of: October 23, 2000 AGENDA SECTION: Consent ORIGINATING DEPARTMENT: CITY MANAGER NO: t~./~. LI Community Development APPROVAL ~ ITEM: Resolution 2000-74, regarding the BY: Kenneth R. Anderson ~/~ ,Bf.'~/~, 2001 Metropolitan Livable DATE: October 18, 2000 /~7 [ 10., ~-© Communities Program. ISSUE STATEMENT: Attached please find a copy of Resolution 2000-74 which solution electing to continue participating for calendar year 2001 in the Local Housing Incentives Account Program under the Metropolitan Livable Communities Act. The Metropolitan Council requests that the attached resolution be used by the cities who elect to participate in the program. BACKGROUND: The Metropolitan Council requires that communities provide a resolution of intent to participate in the Metropolitan Livable Communities program by November 15 each year. Columbia Heights has elected to participate in each of the past six years. During previous years, housing goals (attached) were set for each City and a Housing Action Plan was required to participate in the program. Note that Columbia Heights currently exceeds the housing targets that have been established, and the required Housing Action Plan was prepared in 1996. ANALYSIS: Incentives for renewed participation include access to nearly $15 million for housing development, clean-up of polluted sites for business and housing development, and mixed use development. There are three funding accounts through the Livable Communities Fund that the City has access to on a competitive basis. These are as follows: · The Livable Communities Demonstration Account is designed to fund a variety of community development projects through loans or grants (Columbia Heights was awarded $575,000 for the Transition Block Project through this program); · The Tax Base Revitalization Account provides grants for polluted site cleanup; and, · The Local Housing Incentives Account provides grants to help cities work toward affordable and life cycle housing goals through a voluntary program. RECOMMENDATION: Staffrecommends that the City Council adopt Resolution 2000-74, renewing our participation in the Metropolitan Livable Communities Program. MOTION: Move to waive the reading of Resolution 2000-74, there being ample copies available to the public. MOTION: Move to adopt Resolution 2000-74, Being a Resolution Electing to Continue Participation in the Local Housing Incentives Account Program under the Metropolitan Livable Communities Act for calendar year 2001. COUNCIL ACTION: H:\consent~Resolution 2000 74 RESOLUTION 2000-74 BEING A RESOLUTION OF THE COLUMBIA HEIGHTS CITY COUNCIL ELECTING TO CONTINUE PARTICIPATING IN THE LOCAL HOUSING INCENTIVES ACCOUNT PROGRAM UNDER THE METROPOLITAN LIVABLE COMMUNITIES ACT WHEREAS, the Metropolitan Livable Communities Act (Minnesota Statutes Section 473.25 to 473.254) establishes a Metropolitan Livable Communities Fund which is intended to address housing and other development issues facing the metropolitan area defined by Minnesota Statutes Section 473.121; and WHEREAS, the Metropolitan Livable Communities Fund, comprising the Tax Base Revitalization Account, the Livable Communities Demonstration Account and the Local Housing Incentive Account, is intended to provide certain funding and other assistance to metropolitan area municipalities; and WHEREAS, a metropolitan area municipality is not eligible to receive grants or loans under the Metropolitan Livable Communities Fund or eligible to receive certain polluted sites cleanup funding from the Minnesota Department of Trade and Economic Development unless the municipality is participating in the Local Housing Incentives Account Program under the Minnesota Statutes Section 473.254; and WHEREAS, the Metropolitan Livable Communities Act requires the Metropolitan Council to negotiate with each municipality to establish affordable and life-cycle housing goals for that municipality that are consistent with and promote the policies of the Metropolitan Council as provided in the adopted Metropolitan Development Guide; and WHEREAS, each municipality must identify to the Metropolitan Council the actions the municipality plans to take to meet the established housing goals through preparation of the Housing Action Plan; and WHEREAS, the Metropolitan Council adopted, by resolution after a public hearing, negotiated affordable and life-cycle housing goals for each participating municipality; and WHEREAS, a metropolitan area municipality which elects to participate in the Local Housing Incentives Account Program must do so by November 15 of each year; and WHEREAS, for calendar year 200 I, a metropolitan area municipality that participated in the Local Housing Incentive Account Program during the calendar year 2000, can continue to participate under Minnesota Statutes Section 473.254 if: (a) the municipality elects to participate in the Local Housing Incentives Account Program by November 15, 2000; and (b) the Metropolitan Council and the municipality have successfully negotiated affordable and life-cycle housing goals for the municipality: NOW, THEREFORE BE IT RESOLVED that the Columbia Heights City Council hereby elects to participate in the Local Housing Incentives Program under the Metropolitan Livable Communities Act during the calendar year 2001. Passed this 23rd day of October, 2000 Offered by: Seconded by: Roll Call: Mayor Gary L. Peterson Patricia Muscovitz, Deputy City Clerk HOUSING GOALS AGREEM ENT METROPOLITAN L/V'EABLE COM34UNITI S ACT PRINCIPLES PRI~CII)LES: The City of Columbia HU~hu supports: I) The development of homing types for people i~ all stages of the life cycle, with particular emphasis on additional senior housing opportunities and owner-occupied housing that is taore consistent with merropolitan/suburbun average values. 2) Housing redevelopment activities that promote a balanced housing stock within the Metropolitan Cotmal's benchmark ranges of ~ffordabili~y, 5re style, and den~/ty. 3) Principles that assure that the City's various housing programs conuoue to a~commodate people at ail income levels, racial ~oups. or ethic backgrounds. The promotion of redevelopment activities that diversify the tax ba~e, mammize land use u~ization, and a~ the same time respec: the aararal environment. 5) Aa emphasis on housing ~tivifies that serve to rehabilitate the vast owner-occupied-affordable housing resources already existing in the city. 6) W'aere r'easible, establish rented rehabilitation programs aimed at stabilizing and improving the conditions of ~e vast ~ffo~able rental housing resources already existing in the city. GOALS: To carry out the above housing principles, the City of Columbia Heights agrees to use bencbanark indicators for commaniries of similar locauon and state of development as affordable ,nd life-cycle housing goals for the period 1996 to 2010. and to make its best efforts. given market condirioos and resource availability, to maintain aa iodex wit~o the benchmark ranges for affotdability, life-cycle and density. .a~'fordabili~ Ow~ersNp Rental Life-Cycle Type (Non-Single Family Detached} Owner/Ranter Mix 96% 7%87% I 86% 58% ~,5-50% t 49% I 36% I 33-..~1% 38% 68;32% [(6a-75)/ 75/25% (25-36)% D~nsity Single-F~mily Detached /.O/acre I 2.3-2.9/acre I 3.9/acre Multifamily I 22/acre 13-15/acre 211acr~ To achieve the above goalS, the City of Columbia Heights elects to pat-dcipate in the Metropolitan Liveable Communities Act Local Housing Incentives Program and will prepar~ and submit a pian to the Metropolitan Council by Ame 30. I996. indicating the actions it wiil take to carry out the above goals. CERTI~'ICATION /<- -/-<'% %s'-" Date CITY COUNCIL LETTER Meeting of October 23, 2000 AGENDA SECTION: Consent ORiGINATING DEPARTMENT CITY MANAGER NO. L'/ ,'~' 5 POLICE APPROVAL: ITEM: Indoor Range Update BY: THomas M. Johnson NO. DATE: October 17, 2000 E BACKGROUND In March 2000 the City Council held a public hearing to approve the list of equipment to be purchased with our 2000 Federal Equipment Block grant. These items had previously been approved by a committee made up of local school representatives, church representatives, the City Attorney, an Anoka County judge, the City Manager, and members of our business community. Part of the equipment approved was that which is needed to rebuild our pistol range. This was in the amount of $14,000. Because of savings we were able to realize from other purchases of equipment from this grant, we have an additional $2,000 that will be available for the range costs. Another share of the money needed to cover the cost of the rebuilding came from funds that we received from the State of Minnesota for being part ofthe weekend prisoner/detox transport detail. We received approximately $3,400 from this program in 2000 and the City Council previously approved placing these funds in our contributions fund account to be used for this project. The final source of dollars for this process is money donated to this project by local contributors. To date we have received a total of $3,000 through donations from the Columbia Heights VFW, the Columbia Heights Boosters, and the Tri-City American Legion. This brings our total to approximately $22,400. ANALYSIS/CONCLUSION The department has looked at two vendors for the range materials in this project: RRI Range Systems and Caswell Detroit Armor. The quote for the improvements needed from RRI is $19,109.12 plus tax. The quote from Caswell Detroit Armor is $42,800 plus tax. Each of these systems includes abatement of the current bullet trap, installation of a new bullet trap, and the installation of a new ventilation system. The second parts of the quotes we received involve the electrical costs for the modifications made to the system. We received two quotes for this work. The first quote was from Aid Electric in the amount of $3,306 plus tax. The second quote was from heights Electric in the amount of $4,700 plus tax. RECOMMENDED MOTION: Move to approve the purchase and installation of a new bullet trap system and ventilation system from RRI Range Systems in the amount of $19,109 plus tax and approve electrical modifications needed to run this system to be made by Aid Electric in the amount of $3,306 plus tax; funding to come from the 2000 Federal Equipment Block Grant Fund 276-42112 and Fund 863, Police Contributions Fund. TMJ:mld 00-239 COUNCIL ACTION: CITY COUNCIL LETTER Meeting of March 13, 2000 AGENDA SECTION: .... ORIGINATING DEPARTMENT CITY MANAGER NO. ~ - A POLICE APPROVAL: ITEM: Public Hearing, Federal Law Enforcement BY: Thomas M. JohnsonAi~ BY.~,~ NO. Block Grant for Equipment Purchase DATE: March 8, '2000 M-~' ¥ DATE."" BACKGROUND: In August 1999, the City Council approved the acceptance of a federal equipment block grant in the amount of $23,945 with a match of $2,661. This was approved at the August 23, 1999, City Council meeting. On February 15, 2000, a review committee made up of department members, the City Attorney, a district judge, a junior high principal, Anoka County Corrections, the Anoka County Sheriff's Office, a local businessman, a local pastor, and a representative from Immaculate Conception Church and School met to review this list and offer any ideas for changes. The list was approved as stated. On February 28, 2000, the City Council set a public hearing date of March 13, 2000, as required by the grant. ANALYSIS/CONCLUSION: The Police Department has met all of the requirements of this grant except the public hearing, which is being held today. RECOMMENDED MOTION: Move to close the public hearing and approve the list of equipment to be purchased with this grant. TMJ:mld 00-77 COUNCIL ACTION: COLUMBIA HEIGHTS POLICE DEPARTMENT 2000 EQUIPMENT BLOCK GRANT PURCHASES 3. 4. 5. 6. 7. 8. 9. Body bunkers, 2 each Ballistic helmets, 10 each Night vision binoculars, 1 pair Ammunition for practice Spare MP5 magazines and clamps MP5 Simunition conversion kit Blue traffic vests, 26 each Pnnter for squad room Range upgrade Tax Total $2,450 $2,500 $2,595 $1,000 $150 $150 $700 $1,000 $14,000 $1,729.39 $26,274.39 City of Columbia Heights Police Department MEMO To: Chief Johnson From: Corporal Austinl~- Subject: Indoor Range Upgrade Date: October 11, 2000 Attached are the quotes that the department has received for upgrading our indoor range. I have included quotes from Caswell and from Range Systems for installation of ventilation and bullet traps, and removal of old bullet traps(abatement). I also enclosed quotes from Aid Electric and Heights Electric for the wiring process. I broke the costs down for materials and labor where I could (two of the quotes combined materials and labor in their quotes). I hope this helps. If you have any questions, or thoughts on what needs to be done next, let me know. RANGE QUOTES RANGE SYSTEMS, BY RENEW RESOURCES, INC. 250 Marquette Ave., Suite 100 Minneapolis, MN 55401-2188 ph# (763)332-6400 fax#(763)332-6500 Labor Costs: Removal (abatement) of the existing bullet trap: Installation of new bullet trap, baffles, and dura panels: Installation of ventilation system: $2875.00 $2698.84 $4,000.00 Material Costs: Range Systems "Encapsulator" Bullet Trap: Range Systems Pistol Grade Light Protection Baffles: Dura-Panels for face of existing baffle Ventilation Materials: Freight and Handling: Controls for ventilation TOTAL: $4,375.04 $ 615.12 $ 216.00 $3,600.00 $ 230.00 $ 5OO.OO $19,109.12 +tax RANGE QUOTES Caswell Detroit Armor Companies 2540 Second St NE Minneapolis, MN 55418-3412 ph#(763)379-2000 fax#(763)379-2367 Bullet trap: Removal of old bullet trap: Installation of LE6500 Bullet Trap: $7,000.00 $10,800.00 Ventilation System: Upgrade of Ventilation System: $25,000.00 TOTAL: $42,800.00+tax ELECTRICAL MODIFICATIONS: AID ELECTRIC CORPORATION 7101 Highway 65 NE Fridley, MN 55432 ph#(763)571-7267 fax#(763)571-4735 Bring feeder for 230 volt, three phase 30 kW heater (75 amp load) Wire Electric heater and provide discormect per code Bring feeder for one air handler and provide disconnect Provide power for one motorized damper Interlocking and controlling not included (they can do the ~vork with some drawings of sequence of operation) Permit fee Parts costs: Labor: Total: $ 800.00 $2,506.00 $3306.00 +tax ELECTRICAL MODIFICATIONS HEIGHTS ELECTRIC, INC 704 40,h Ave. NE Columbia Heights, MN 55421 ph#(763)788-8888 fax#(763)788-8922 Furnish labor and material for installing necessary feeders, circuits, subpanels and connections to the following equipment: Electric Duct Heater Air Handler Motorized Damper Electrically interlock existing exhaust fan, air handler and electric heater Temperature control furnished and installed by others Total (material and labor): $4,700.00 +tax Note: material and labor was not separated CITY COUNCIL LETTER Meeting of: October 23, 2000 AGENDA Consent ORIGINATING CITY SECTION: DEPARTMENT: MANAGER ~-1- A-b APPROVAL NO: Fire NO: Department Pumper DATE: October 17, 2000 DATE: Background The Fire Department currently has a 1967 Pirsch 1250 GPM Pumper in its inventory. This pumper is 33 years old and is in need of repair; the brakes, master cylinder, and power steering need to be replaced. Currently, the Fire Department only uses this vehicle for parades and to move firefighters during major incidents. The cost of repairs to the pumper outweighs its usefulness, Analysis/Conclusion Staff requests that the City Council pass a motion giving the Fire Chief authority to solicit sealed bids on the pumper. Recommended Motion: Move to authorize the Fire Chief to solicit sealed bids for the sale of the 1967 Pirsch 1250 GPM pumper. ICOUNCIL ACTION: CITY COUNCIL LETTER Meeting of: October 23, 2000 AGENDA SECTION: Consent ORIGINATiNG DEPARTMENT: CITY MANAGER ,_~ ~ ~, _-~ APPROVAL } ITEM: BY: Charles Thompson NO: DATE: Ootoberl ,=O00 l© Background On August 2, 2000, the St. Anthony Fire Department requested Columbia Heights Fire to respond to their station to cover their calls while they were on the scene of a ruptured gas main. Columbia Heights sent one engine with a crew of four. On October 12, 2000, we received a check in the amount of $1,750 from St. Anthony to cover the cost of the equipment and manpower that we had provided. NSP had reimbursed St. Anthony and all their responding agencies for time and equipment. The check was deposited in our General Fund Account #101-00-34202. Analysis/Conclusion The Fire Department is requesting that the City Council pass a motion to reallocate the funds from General Fund Account #101-00~34202 to Fire Department Overtime Regular Fund Account #101-42200-1020. Recommended Motion: Move to transfer $1,750 from General Fund Account #101-00-34202 to Fire Department Overtime Regular Account #101-42200-1020. 00-94 COUNCIL ACTION: CITY COUNCIL LETTER Meeting of October 23, 2000 AGENDA ORIGINATING CITY SECTION: DEPARTMENT: MANAGER tq _ ~;'i ~ ~ Fire APPROVAL NO: Re-Issue Rental Housing License after BY: Dana Alexon BY:/~j~ ITEM: Revocation DATE: October 17, 2000 DATE: NO: The matter of the revocation of the license to operate a rental unit(s) within the City of Columbia Heights against A.C. Milan, LLC regarding rental property at 500 40th Avenue for failure to meet the requirements of the Residential Maintenance Codes has been resolved. The above mentioned owner has paid all fees due. RECOMMENDED MOTION: Move to issue a Rental Housing License to A.C. Milan, LLC to operate the Rental Property located at 500 40th Avenue in that the provisions of the Residential Maintenance Code have been complied with. COUNCIL ACTION: CITY COUNCIL LETTER Meeting of.' October 23, 2000 AGENDA ORIGiNATING CITY SECTION: DEPARTMENT: MANAGER LI~ ,'Sx- ~ APPROVAL NO: Fire ITEM: Establish Hearing Dates BY: Dana Alexon BY: License Revocation, Rental Properties NO: DATE: October 17, 2000 DATE: Revocation or suspension of a license to operate a rental property within the City of Columbia Heights is requested against the following owners regarding their rental property for failure to meet the requirements of the Housing Maintenance Codes. 1. DaleFrenzel ................................ 3732 3rd Street 2. Mohammed Khan ............................ 981 43-1/2 Avenue 3. Steven Efterfeld .............................. 1100-1102 39th Avenue 4. Kwei Fang .................................. 4055-4057 University Avenue RECOMMENDED MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Dale Frenzel at 3732 3ra Street NE. RECOMMENDED MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Mohammed Khan at 981 43-1/2 Avenue NE. RECOMMENDED MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Steven Efterfeld at 1100-1102 39th Avenue NE. RECOMMENDED MOTION: Move to Establish a Hearing Date of November 13, 2000 for Revocation or Suspension of a License to Operate a Rental Property within the City of Columbia Heights against Kwei Fang at 4055-4057 Universitw Avenue NE. COUNCIL ACTION: COLUMBIA HEIGHTS - CITY COUNCIL LETTER Meeting of: October 23, 2000 AGENDA SECTION: Recognition ORIGINATiNG DEPARTMENT: CITY MANAGER NO: 5 - D CITY MANAGER APPROVAL ITEM: Appointment and Introduction of BY: Walt Fehst BY: New Commission Members DATE: October l8, 2000 DATi~,f~,~..,~,/~Io-o Ms. Donna Kay Schrnitt, 4260 Tyler Street, will be present to be introduced and appointed to the Planning and Zoning Commission, fulfilling a four-year term to April 1, 2003. Mr. Harold Netkow, 1169 49~ Avenue, will be present to be introduced and appointed to the Police and Fire Civil Service Commission, fulfilling a three-year term, ending April 1, 2000. Mr. Roger Peterson, is anticipated to be present to be introduced and appointed to the Park and Recreation Commission, to fulfill a five-year term, ending April 1, 2002. RECOMMENDED MOTION: RECOMMENDED MOTION: RECOMMENDED MOTION: Move to appoint Donna Kay Schmitt, to fulfill a four-year term, ending April 1, 2003 to the Planning and Zoning Commission. Move to appoint Harold Netkow, to fulfill a three-year term, ending April 1, 2003 to the Police and Fire Civil Service Commission. Move to appoint Roger Peterson, to fulfill a five-year term, ending April 1, 2002 to the Park and Recreation Commission. COUNCIL ACTION: h:\2000- I 0-23appoint CITY OF COLUMBIA HEIGHTS Meetin: of: October 23, 2000 AGENDA SECTION: Public Hearings ORIGINATING DEPARTMENT: CITY MANAGER NO: k2 - ,~ Community Development APPROVAL ITEM: P ublicHeafingandSecondReading BY: KennethR. Anderson ~ B Y:~~~ of Ordinance No 1421, Amending DATE: October 17, 2000 Ordinance No. 853, Conveying Real Estate at 3855 Main Street N.E. ISSUE STATEMENT: Conduct the second reading and Public Hearing of Ordinance Number 1421, Being an Ordinance Amending Ordinance Number 853, City Code of 1977, Authorization to Convey Certain Real Estate at 3855 Main Street N.E. to Brian Michael Roeller. BACKGROUND: The City of Columbia Heights acquired the property at 3855 Main Street N.E. from the previous property owner on Tuesday, August 15, 2000. The adjacent property owner to the south, Brian Michael Roeller of 3849 Main Street N.E., is interested in acquiring the property and incurring the cost to demolish the existing substandard structures on the lot which include a single family dwelling and detached garage. It is Mr. Roeller's intention to split the lot equally and convey the north half to the property owners at 3859 Main Street N.E. owned by Patrick and Sherd A. Truchinski. Staffhas prepared a draft of Ordinance Number 1421 for City Council consideration to convey the subject parcel to Mr. Roeller. ANALYSIS: The City Code requires that the City convey the sale of real estate after conducting a first reading and second reading with an effective date 30 days alter the Public Hearing and second reading. The public purpose for conveying this parcel to the adjacent property owners will be to remove a substandard, blighting influence on the neighborhood by allowing the adjacent property owners to undertake the acquisition, abandonment of utilities, demolition of the structures, and site restoration work as required to meet minimum City standards. The property will be split equally and combined with adjacent properties thereby eliminating a non-conforming structure and creating two properties with more open space and adjacent side yard setbacks exceeding twenty feet each. RECOMMENDATION: The City Council conducted a first reading on October 9, 2000 and set a Public Heating and second reading of Ordinance Number 1421 to be held at the regular session on October 23, 2000 at approximately 7:00 p.m. Staff recommends City Council adoption of Ordinance No. 1421. RECOMMENDED MOTION: Move to waive the reading of Ordinance 1421, there being ample copies available to the public. RECOMMENDED MOTION: Move to adopt Ordinance No. 1421, Being an Ordinance Amending Ordinance No. 853, City Code of 1977, Authorization to Convey Certain Real Estate located at 3855 Main Street N.E. Attachments: Ordinance No. 1421, Sale/Development Agreement. ICOUNCIL ACTION: H:~consent2000~Ordinance 853Reading #2 ORDINANCE NO. 1421 BEING AN ORDINANCE AMENDING ORDINANCE NO. 853, CITY CODE OF 1977 AUTHORIZATION TO CONVEY CERTAIN REAL ESTATE LOCATED AT 3855 MAIN STREET NE The City of Columbia Heights does ordain: Section l: The City of Columbia Heights, a Minnesota municipal corporation, may convey unto Brian Michael Roeller, the real property described as follows, to wit: Lot 29, Block 80, Columbia Heights Annex to Minneapolis, Anoka County, Minnesota. Section 2: The Mayor and City Manager are herewith authorized to execute a deed to effectuate the conveyance of said real estate subject to the terms, purchase price, and conditions specified in the Sale/Development Agreement. Section 3: 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: October 9, 2000 Offered By: Seconded By: Roll Call: Mayor Gary L. Peterson Patricia Muscovitz, Deputy City Clerk SALE / DEVELOPMENT AGREEMENT THIS SALE/DEVELOPMENT AGREEMENT ("Agreement") is made this __ day of ,2000, by and between the City of Columbia Heights ("City"), a municipal corporation; Brian Michael Roeller and ("Roeller"); and Patrick Truchinski and Sherri A. Truchinski, husband and wife ("Truchinski"). WHEREAS, the City owns the real property located at 3855 Main Street NE, as legally described in Exhibit A. Said property currently has a sub-standard single family home thereon; and WHEREAS, Roeller owns the real property located at 3849 Main Street NE, which is the property directly adjacent to the south of 3855 Main Street NE; and WHEREAS, Truchinski owns the real property located at 3850 Main Street NE, which is the property directly adjacent to the north of 3855 Main Street NE; and WHEREAS, it is the desire of all parties hereto that the sub-standard structure located at 3855 Main Street NE be razed, the lot split and deeded in equal proportion to Roeller and Truchinski. NOW, THEREFORE, the parties hereto agree as follows: 1. Officer/Acceptance. Roeller offers to purchase and City agrees to sell the real property located at 3855 Main Street NE, Columbia Heights, Anoka County, Minnesota, legally described in Exhibit A. 2. Purchase Price. The price for the real property included in this sale is Twenty Thousand Dollars ($20,000), which Roeller agrees to pay in cash on ,2000, the Date of Closing. Closing shall take place at City Hall, or at some other mutually agreeable location. 3. Deed. Upon performance of Roeller, City shall execute and deliver a quit claim deed conveying title of record, subject to: (a) building and zoning laws, ordinances, state and federal regulations; (b) reservation of any mineral rights by the State of Minnesota; and (c) utility and drainage easements. 4. Real Estate Taxes and Special Assessments. Real estate taxes due and payable in and for the year of closing shall be pro-rated between the City and Roeller on a calendar year basis to the actual Date of Closing. Roeller shall pay on Date of Closing all installments of special assessments certified for payment with the real estate taxes due and payable in the year of closing. Roeller shall assume all other special assessments levied as of the date of this Agreement. Roeller shall pay real estate taxes due and payable in the year following closing and thereafter and any unpaid special assessments payable therewith and thereafter, subject to the further conditions as set forth herein. City makes no representation concerning the amount of future real estate taxes or of future special assessments. 5. Condition of Property. The parties hereto acknowledge that the subject property is being sold in an "As Is" condition. 6. Termination of Utility Services. Termination of all utility services must be completed within thirty (30) days of the Date of Closing. All costs of such termination shall be the joint and several responsibility of Roeller and Truchinski. If Roeller and Truchinski wish to have the utility services terminated prior to the Date of Closing (due to weather related issues), City agrees to conduct such services upon prior receipt of an agreed upon cost of such termination. If the termination of the utility services is not completed within thirty (30) days of the Date of Closing. Roeller and Truchinski hereby agree that City may then conduct such work or contract for the same, with the costs of the termination to be assessable in equal shares against the real property owned by Roeller and Truchinski as described above. 7. Removal of Existing Structures. Complete removal of all existing structures located on the subject property must be completed within ninety (90) days of the Date of Closing. All costs of such removal shall be the joint and several liability of Roeller and Truchinski. If the removal of the existing structures is not completed within ninety (90) days of the Date of Closing, Roeller and Truchinski hereby agree that City may then conduct such work, or contract for the same, with the costs of the removal to be assessable in equal shares against the real property owned by Roeller and Truchinski as described above. 8. Property Restoration. Once all existing structures are removed, the lot shall be restored so that the grade of the lot matches the adjacent properties. Ground cover of seed or sod must be provided no later than May 31, 2001. The cost of the above work shall be the joint and several responsibility of Roeller and Truchinski. If the restoration and groundcover are not provided by May 31, 2001, Roeller and Truchinski hereby agree that City may conduct such work, or contract for the same, with the costs of the restoration and/or groundcover to be assessable in equal shares against the real property owned by Roeller and Truchinski as described above. 9. Possession. City shall deliver possession of the property to Roeller no later than the Date of Closing. 2 10. Lot Split/Resale. Within one (1) year from the date of possession, Roeller shall cause to be accomplished a lot split of the subject property. The split shall divide the property from east to west and shall be as close to an equal division of the property as possible. Also within one year of the date of possession, Roeller hereby agrees to sell to Truchinski the northerly portion of the subject property created pursuant to the lot split. Roeller shall deliver to Truchinski a quit claim deed conveying said portion upon purchase payment of $10,000 by Truchinski. In addition to the $10,000 purchase price, Truchinski shall also reimburse Roeller for one-half (1/2) of the utility termination, structure removal, property restoration and lot split costs if not already so paid by Truchinski. 11. Redevelopment Prohibit. If for any reason the above-referenced lot split is not completed, Roeller hereby agrees not to lease or resell the subject property for any redevelopment purposes. If this specific provision is violated, City shall be hereby authorized to withhold any permits, certificates of occupancy or other approvals that such redevelopment may require. 12. Minnesota. Minnesota Law. This Agreement shall be governed by the laws of the State of CITY OF COLUMBIA HEIGHTS By: Its: Mayor By: Its: City Manager Brian Michael Roeller Patrick Truchinski Sherri A. Truchinski 3 STATE OF MINNESOTA) )SS COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of ., 2000, by Gary Peterson and Walt Fehst, the Mayor and City Manager, respectively of the City of Columbia Heights, on behalf of the City. Notary Public STATE OF MINNESOTA) )SS COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this ,2000, by Brian Michael Roeller and day of Notary Public STATE OF MINNESOTA) )SS COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this ,2000, by Patrick Truchinski and Sherri A. Truchinski. day of Notary Public 99507_1 4 EXHIBIT A PROPERTY IDENTIFICATION NUMBER: 35 30 24 33 0059 LEGAL DESCRIPTION: Lot 29, Block 80, Columbia Heights Annex to Minneapolis, Anoka County, Mirmesota City of Columbia Heights Park and Recreation Commission September 27, 2000 The meeting was called to order by Eileen Evans at 6:30 p.m. ROLLCALL Members present: Members absent: Eileen Evans; Jerry Foss; Gary Mayer; Scott Niemeyer; Gary Peterson; Bob Ruettimann; Keith Windschitl, Recreation Director; Kevin Hansen, Public Works Director Pat Cullen; Bruce Magnuson APPROVAL OF CONSENT AGENDA Motion by Foss, seconded by Mayer to approve the consent agenda. All ayes, motion carried. LETTERS AND REQUESTS REQUEST FOR REDUCTION OF FEE OR FEE-WAIVED USE OF MURZYN HALL Members reviewed the letter from Kathleen Wakaruk requesting a reduction or waiving of the fee for use of Murzyn Hall on Sunday, October 29, 2000. The event is a fund raiser to help the Perzel family with upcoming medical expenses, lost wages, and daycare expenses. The Commission discussed the fact that in the past the fee had been waived or reduced for members of our own community but since neither of the parties mentioned were residents it would be best ifa fee would be charged. Motion by Reuttimann, second by Mayer to authorize a 25% discount on the use of Murzyn Hall for this request after the Recreation Director has checked with Ms. Wakaruk on what the plan was for this event. OLD BUSINESS MURZYN HALL REAR PARKING LOT REPAIR Recreation Director, Keith Windschitl, in£ormed the Commission that the back parking lot of Murzyn Hall has been redone as well as a new back entryway. This should alleviate drainage problems that have occurred in the past. The striping of the parking lot will be done the week of October 2"a. A letter to the City Council was included with a breakdown o£the total cost for the project. PROPOSED LANDSCAPING FOR S.E. CORNER OF MURZYN HALL Public Works Director, Kevin Hansen, submitted a drawing detailing the proposed landscaping plan for the S.E. comer of Murzyn Hall. There would be a retaining wall with one terrace; the removal of undergrowth with the hope of keeping existing trees; and additional landscaping. Kevin indicated that the Public Works Department would not be able to get to this project until the end of October at the earliest. Some of the work would still have to be contracted out as well. The Commission discussed the idea of community volunteers taking this on as a special project with Public Works helping as needed. Because of the cost, it was also mentioned that the materials be purchased this year when monies are available. Motion by Niemeyer, second by Mayer to approve the proposed plan and present it to the City Council with the money and who will do the work components to be worked out at a later date. All ayes, motion carried. EVENT WAGON Keith Windschitl, Recreation Director, reported that the Event Wagon was a big success. It was used 8 times by Columbia Heights residents since mid-June. All were very pleased with what it has to offer. NEW BUSINESS ROLLER BLADE\SKATE BOARD PARK Kevin Hansen, Public Works Director, reported that Ostrander Park had been looked at as a possible site for the roller blade\skate board park. After talking with the City Manager and looking at the site, it was decided this was not the best location to put this type of facility. Kevin's recommendation, if this type of facility is to be seriously looked at, would be to put it at Huset Park, in the west area. Kevin indicated other communities are building skate parks and suggested that if Columbia Heights were to do this, a Tier 1 type of facility would be best. This means nothing is over 36" high and medical staff does not have to be on site. Kevin also talked to the Commission about making Huset Park a community showcase with changes in what it offers. He indicated there might be grant monies available to use for this type of project. The Commission discussed the possibilities at length and requested Kevin to bring a copy of what a new park plan for Huset Park might look like to the next meeting. Bob Reuttimann also indicated the Anoka County might have monies available for this type of use. RESIGNATION OF JANICE McGHEE FETZER, MURZYN HALL COORDINATOR Keith Windschitl, Recreation Director, told the Commission Janice's last day was September 22, 2000. Keith will be doing the Murzyn Halt rentals until someone else is hired. Hopefully this will be no later than mid-November. He informed the Commission that Paula Haynus is working as a receptionist from 11:00 a.m. - 3:00 p.m. and Cindi Willprecht, the Youth Enrichment Coordinator, is now a half time employee. JOINT BUDGET MEETING The joint budget meeting with staff, Commission, and City Council will be held on Wednesday, October 25 at 7:00 p.m. Keith will send out his budget proposal to the Commission members prior to the meeting. This is not the final draft, but will give the Commission an idea of what was proposed. The Commission will meet at 6:30 p.m. prior to the budget meeting or 6:00 p.m. if the Recreation Director finds there is more business to discuss. He will inform the Commission prior to the 25th. REPORTS RECREATION DIRECTOR Keith informed the Commission that Pat Cullen had resigned from his position on the Commission. He encouraged them to bring forward any recommendations of people who might fill this opening. Keith informed the Commission that the City Manager had cut the $10,000 in the Back to the Parks fund from the budget. Keith told the Commission that out of 45 days requested of the school district for gym space at Central Middle School, 14 days were unavailable. These are the days we know about. More will arise as the season goes on and will definitely have an impact on the basketball program. PUBLIC WORKS DIRECTOR Kevin informed the Commission that Prestemon Park is getting new playground equipment. On October 6th, volunteers will be doing planting in the park. The removal of the Huset Park bandshell will be discussed at the City Council work session to approve bids. It will cost $5,300 to remove. As a point of information Kevin informed the Commission that a community member living by McKenna park uses the walkway by the wading pool to gain access to their home. MEMBERS Jerry Foss brought up the fact that our brochure listed traveling basketball tryouts in October when in fact they have already occurred. This should be coordinated so that those individuals still playing football have a chance to try out for basketball. There is a concern about the communication with the basketball association. Keith will follow up with the association regarding this matter. Jerry also brought up the fact that our football teams have no home games. This is because other teams do not want to play in Columbia Heights as there are no lights on the fields. ADJOURNMENT Motion by Foss, second by Reuttimann to adjourn. All ayes, motion carried. Meeting adjourned at 8:30 p.m. Karen l~oeller, Acting Park & Recreation Commission Secretary Minutes\Sept.00 COLU IBIA H£1GH?$ PUBLIC LIBRARY BOARD OI MINUTES October 3, 2000 The meeting was called to order by Chair, Barbara Miller at 6:25 p.m. Those present were Patricia Sowada, Barbara Miller, Nancy Hoium, Catherine Vesley, Richard Hubbard, John Hunter and Becky Loader. It ~vas moYed, seconded, and passed to approve the minutes of the September 5th, 2000, meeting as mailed. Interim bill list of September 11, 2000, was reviewed. It ~vas moved, seconded and passed that they be paid. Interim bill list of September 20, 2000, was reviewed. It was moved, seconded and passed that they be paid. The bill list of September 25, 2000, was reviewed. It was moved, seconded and passed that they be paid. The bilI list of October 9, 2000, was also reviewed. It was moved, seconded and passed that they be paid. ]'he accounting was revie~ved. Old Business: 1. The article in the Northeaster about the volunteen recognition ceremony was reviewed. Settlement from Baker & Taylor lawsuit was reviewed. The money received has been deposited into Misc. receipts and refunds. The Board was reminded that the November meeting date was changed to Wednesday, November 1, 2000, at 7:00 pm. A staff update was given. There have been no applications for the page or library aide position that could be interviewed. New Business: 1. Due to the staff shortage Marsha has cancelled the Holiday storytime and crafts session scheduled for December. The slate of officers for 2000-2002 was submitted as follows: Barbara Miller, President; Patricia Sowada, Vice-President; Richard Hubbard, Secretary. There were no further nominations. It was moved, seconded and passed to accept the slate of officers as presented. Becky and Catherine attended the Southern Anoka County Chamber luncheon. The presenter gave a report on ha~v to interpret GIS statistics. Those attending had hoped for some information about Medtronic. Becky attended the grand opening of the Transit hub. While there the owner ofthe old Marshall's site gave Becky and other City Council members a tour of the site and expressed interest in the library moving to that site. Staff is in the process of gathering information about operating costs and figures and will meet with the owner to discuss this information next week. The Detail Budget books for the 2001 budget meeting were distributed and assignments reviewed. There being no further business the meeting was adjourned at 6:50 p.m. to meet with the City Council in the Activity. Room about the 200l budget for the library. Respectfully submitted, Jeanine M. Schmidt Secretary to the Library Board of Trustees. 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. LIBRARY BOARD/CITY COUNCIL BUDGET MEETING OCTOBER 3, 2000 7:00 P.M. The joint City Council/Library Board meeting about the library budget for 2001 was held in the activity room October 3, 2000, at 7:00 p.m.. Those present were: Walt Fehst, Barbara Miller, Nancy Hoium. Patricia Sowada, Catherine Vesley, Richard Hubbard, Mayor Gary Peterson, Don Jolly, Julienne Wyckoff, John Hunter, and Rebecca Loader. The meeting was called to order at 7:00 p.m. by Mayor Gary Peterson. Barbara Miller welcomed everyone and introduced the Board Members. Barbara commented on the programming that has taken place at the Library in the past year. It was explained that the agenda would be followed, with a time for questions after each presentation. The budget was distributed to those present, and a copy will be forwarded to the absent City Council Member, Marlaine Szurek. A fact sheet presenting figures and percentage differences for selected expenditures was presented by Pat Sowada. The increases in personnel, other service charges, capital outlay and contingencies and transfers were outlined. The major increases in capital outlay and contingencies am to cover the costs of workstations and furniture utilized by the public and to cover charges for salaries and fringe benefits due to administration duties and work performed by certain positions outside the department. The supply budget shows a decrease for 2001, but includes requests for software licensing and library cards. Ms. Wyckoff asked about the amount in contingencies and transfers, if that is for salaries only. Response: No, it does include potential salary increases since there are no labor contracts settled for 2001, but it also includes administrative fees charged by other departments within the City who do work for the library. Ms. Wyckoffalso asked about the increase in capital outlay. Response: Capital shows an increase because this is the first year of phasing in changes in the automated circulation system (ACS) which includes working toward a client-server environment with pc workstations. Mayor Gary Peterson asked about the Honeywell maintenance agreement with regards to the Library. Response: The City is currently participating in a preventative maintenance agreement with Honeywell. Honeywell responds very well and within a certain time frame that is satisfactory. The portion of the original contract that did not work well for the library was the capital improvement portion. Little was done at the library by way of capital improvements, but the City as a whole was well served by that portion. Walt Fehst responded that the City will be looking at all maintenance functions including Honeywell when they look at the General Buildings' budget. Richard Hubbard presented the capital priorities portion of the agenda. The first priority capital improvement is 6 pc workstations for the public catalog replacing dumb terminals originally purchased beginning in 1987. The second priority is for 2 Buckstaffcomputer tables to house the lntemet browsers used by the public. The third priority is office furniture for the Children's Department. New workstations are needed to replace desks purchased in the 1970's. The request is for modular furniture that would provide more efficient use of the space and a more productive work environment. There were no questions on Mr. Hubbard's portion of the presentation. The Library levy and revenue information were presented by Nancy Hoium. The Library Board is asking that the levy be increased by 9.5%. The levy amount requested is $547,767. The legislature has lifted the levy limits for 2001 for the first time in many years, so this is an opportunity to increase the levy so that expenses do not draw down the fund balance. The revenue and money collected page was reviewed. Walt Fehst spoke on the impact of governmental levy limits and what it means to the City's revenues. There was some discussion by everyone on this topic. Maintenance of effort information was presented by Catherine Vesley. The minimum level of support is determined by the State Department of Children, Families, and Learning. This minimum is $467,518 for the year 2001. This is a minimum. The library could not continue to operate at the current level of service on this amount. The amount needed to meet the contract with Anoka County Library on a per capita basis was also reviewed. Becky Loader spoke about the Long Range Plan and objectives for 2001. 1.) Staff is concentrating on the automation upgrade to a client-server environment by converting the public access catalogs to pc's with WEB2. The current hardware has been in use for 13 years. Additional databases and catalogs will be available to the public with the upgrade. 2.) To explore the possibilities ora new facility within the structure of the City's comprehensive plan, and to continue to look at all plans. 3.) Reaching out into the community as an active partner in ventures with ISD #13 and the Anoka County Historical Society. 4.) Lastly, to develop a proposal for collection development in 2002 to include DVD, recorded books on CD, software, and e-books. Julienne Wyckoff asked about the efforts to establish a Foundation. Response: The original purpose of the foundation was to be a capital foundation to raise money for a new building, not a sustaining foundation for operating costs. The Foundation is not a dead issue, but until there is a plan and formal commitment from the City Council to make a new library building a reality, the Board feels they cannot actively seek contributions to establish the foundation. It was also noted that there is currently a donation account within the budget that is utilized for specific projects. There was discussion about the citizens' survey that the City is conducting concerning the direction the community wants the City Council to pursue. The hope is that the survey results will convey a positive attitude about the future of the City of'Columbia Heights. The Board requested that next year's budget include attendance at a National Conference for the Director of the Library. The Council agreed with that proposal, seeing it as very worthwhile. Mayor Gary Peterson thanked everyone for being at the meeting and for their commitment and efforts. There being no further business the meeting was adjourned at 8:10 p.m. Respectfully submitted, ~anine M. Schmidt, Secretary to the Library Board of Trustees. The Ci0' qf Co[umbia 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. ~/~on request, accommodation will be provided to allo~v individuals with disabilities to participate in all City of Columbia Heights' services, programs, and activities COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY(EDA) REGULAR MEETING MINUTES OF AUGUST 16, 2000 CALL TO ORDER- The Regular Meeting of the Columbia Heights Economic Development Authority (EDA) was called to order by President Ruettimann at 6:32 p.m., Wednesday, August 16, 2000, in the Parkview Villa Community Room B, 965 402 Avenue NE, Columbia Heights, Minnesota. ROLL CALL Commission Members Present: Commission Members Absent: Staff Present: PLEDGE OF ALLEGIANCE. Robert Ruettimann, Patricia Jindra, Marlaine Szurek, Don Jolly and John Hunter Julienne Wyckoff and Gary L. Peterson Ken Anderson, Deputy Executive Director Randy Schumacher, Community Development Assistant Anita Kottsick, Parkview Villa Public Housing Administrator Karl Wilson, Parkview Villa Public Housing Administrator Walt Fehst, Executive Director Cher Bakken, Secretary .aDDITIONS/DELETIONS TO MEETING AGENDA. 9-C-4 and 9-C-5 CONSENT AGENDA. A. Adopt the consent agenda items as listed below: 1) Approval of Minutes. a. Regular Meeting of August, 2000. 2) Financial Report and Payment of Bills. a. Financial Statement for August, 2000 b. Payment of Bills for August, 2000 MOTION by Pat Jindra, seconded by John Hunter, to approve Resolution 2000-l 0, Resolution of the Columbia Heights Economic Development Authority (EDA) approving the financial statement for July, 2000 and approving payment of bills for the month of July, 2000 with the amendment changing the month from August, 2000 to July, 2000 as printed in the agenda. All Ayes. MOTION CARRIED. 3) Approve Payment #3 & #4 to Millar Elevator Service Company Mr. Anderson explained that this was a document for approval of Application 3 and 4 for a total of $90,105. qihe City keeps 10% of each pay application for retainage until the project has been completed, inspected and approved. Staff is recommending payment of Application #3 and In discussion, John Hunter stated his understanding of the retainer policy for the Millar Agreement was that it would be 10% ot the total contract for one year after completion for one year, not 10% of each application fee that the City retains. Mr. Anderson will check into this percentage and report back to the EDA Commission. MOTION by MarIaine Szurek, seconded by John Hunter, to accept the work for Pay Applications #3 and//4 and to authorize payment of $90,105 to Millar Elevator Service Company of Cleveland, Ohio. All Ayes. MOTION CARRIED. 4) Section 8 Report. The Section 8 Certificates will be changed to Vouchers by October 1, 2000. The number of tenants on the program has changed dramatically due to the current staff clarifying which tenants are actually on the Columbia Heights Section 8 program. The report states that there are currently 32 Vouchers and 4 Certificates for a total of 36 which is a decrease of nine from last month. This decreases our utilization to 72 percent. The reason for the significant reduction is that several participants were reflected as active by the previous staffmember. When they where actually inactive. These participants should have not been in the utilization report. We are still targeting the September 1, 2000 date for the transfer to Metropolitan Council. MOTION by Don Jolly, seconded by Marlaine Szurek, to receive the Section 8 report as written. Ali Ayes. MOTION CARRIED. REPORT OF THE MANAGEMENT COMPANY. A. Anita Kottsick, Parkview Villa Public Housing Administrator. The Elevator Modernization project is moving along ahead of schedule according to one of the servicemen that she had recently talked to. The EDA had requested that an inspection of the circuit panels be done and added to the Move Out Unit Preparation Checklist. She reported that this has been added and Bill Gault has already started checking them as Economic Development Authority Minutes August 16, 2000 Page 2 of 5 people have moved. Anita wanted to correct the date that was printed in her occupancy report for when she will be meeting with Marion Booth. It will be on the 17t~ of August She also wanted to introduce Kari Wilson as the Housing Administrator for Parkview Villa to be working in the morning hours. Anita will be spending her afternoons at the Parkview Villa office. Karl will be introduced to the residents at their meeting on August 14th. CITIZEN FORUM. Ruth Borris, Unit 123, expressed her concem about the garbage smell behind Parkview Villa. She has contacted the City Hall and the Anoka dispatcher in this regard. She was also concerned about the handicapped residents being on the seventh or eighth floor. Ruth suggested that they should not put these residents with medical problems up that high in the building because they could never get out if there was a fire and the elevators were inoperative. Ruth Hillested, Unit 310, asked for a report on the garage security. Mr. Anderson reported that we need to get a floor plan for each unit to provide this information to the company that will be quoting the job. Ken has not been able to fred a copy of the plan for the south building. Pres. Ruettiraama suggested that Ken contact HUD or the County offices to obtain the plans. Ruertimaun asked that we get a report back to him by next week so that he can report back to the resident the status of the security system that was talked about last month. In the meant/me, some common ideas were shared about the tenants safety exiting and entering the building. Opal Baker asked what store was going in next to Stroncek's Eagle Dmg Store on Central Avenue. Mr. Anderson stated that a driving center is going in on one side and the other half has not been determined yet. Ms. Baker stated that the construction going on is just adding to the noise. Mr. Hunter received a cai1 from a citizen of the community wondering if a dirty book store was going into that unit. He has checked into it and it is traly a RUMOR! RECOGNITION~ PROCLAMATIONS~ PRESENTATIONS~ GUESTS - None. PUBLIC HEARINGS - None. ITEMS FOR CONSIDERATION. A. Other Resolutions - None. B. Bid Considerations - None. C. Other Business. 1) MHFA Loan A Minnesota Housing Finance Agency Minnesota Fix-Up Fund loan that was originated by the EDA on December 12, 1997, to Shemey and Catherine Gafkjan in the amount of $6,527.16. The property was sold in October of 1998 and the loan went into default. Shemey payed 1/3 of the remaining balance at closing and stated that Catherine Gafkjen's daughter received 2/3 of the property sale proceeds, so the remaining balance of the loan due should be received from her. Ken Anderson consulted an attorney for advice. The City A~aomey suggested that the EDA pay Compu-Link Loan Service, Inc., for the unpaid amount of $4,377.80 as of 8-15-2000, plus $ .66 daily per diem and $350.00 to MHFA. In discussion, Mr. Ruettimann would like a copy of every mortgage that is not filed with Anoka County by the next EDA meeting in September, 2000. He also requested that Mr. Anderson write to the County to receive a report of any mortgages that are not filed currently. Ken asked if we could provide a list to the Commissioners ofjust the mortgages that we are having trouble with? Pres. Ruettimann stated that he would like to have all of the 26 or 27 mortgages open with the City manually checked to get a report of the status of all of them. Pres. Ruettimarm requested that we table this motion until next month when a report can be provided to the cormmssioners of the current status of all 26 or 27 open mortgages with the City of Columbia Heights. 2) Budget Meeting Mr. Anderson proposed that a special meeting be scheduled to discuss the 2001 Budget. Currently the Budget is not ready for review. He assured the EDA Commission that the Budget will be done sometime in the next week. Pres. Rueittmann suggested that the meeting be scheduled September 15, 2000, that only the Final Budget is discussed, nothing else that night so that the Budget is ready for adoption by the September 15a' City Cotmcil meeting. Walt Fehst suggested that we schedule the budget to be presented to the EDA the first week in September. No date was scheduled at this time. Walt Fehst and Ken Anderson will schedule the EDA's reviewal meeting and let the Commissioners know of the date later. Economic Development Authority Minutes August 16, 2000 Page 3 of 5 3) Approve the Initial and Cooperation Agreement for the Transition Block Redevelopment Project. Mr. Anderson explained that this is a request from Real Estate Equities for the approval by the EDA and the City. The Agreements are related to the Transition Block Redevelopment project which includes the properties of NEI College of Technology at 825 41~ Avenue NE., the EDA's property at 4150 Central Avenue NE., Citywide Locksmithing at 4156 Central Avenue NE., and the house at 4157 Jackson Street. These two Agreements need to be executed by the EDA and the Cooperation Agreement only needs to be executed by the City. The City Council took action on the Cooperation Agreement at its meeting on August 14th and approved it subject to additional language being included. The Initial and Cooperation Agreements basically explain how the funds will be distributed between the Minneapolis Public Housing Authority, Metropolitan Council HRA, City of Columbia Heights, and the Columbia Heights EDA. Legal counsel for the City/EDA has reviewed the Agreements and has suggested that the EDA approve the two Agreements with the contingency or addition of the proposed language or language substantially similar and acceptable to legal counsel for the City and EDA. In discussion, it was noted the Council set a Public Heating for September 25, 2000 to review the proposed TIF Plan and establishment ofa TIF District. Staffhas not reviewed the Tax Increment Financing Plan. August 25, 2000 is the date that the Tax Increment Financing Plan is to be presented to the School District and Anoka County in a draft form according to the financial advisors outline for the proposed time schedule. President Ruettimann was concerned that the EDA signs the Agreements and the project would go through with some changes by City Council that the EDA wouldn't necessarily agree on and the contract would go through. Mr. Anderson stated that the EDA and City Council review and approve the necessary TIF Agreements. If the Planning and Zoning Commission does not approve the PUD Agreement, then the Agreement will not go through. Mr. Fehst stated that if the City and EDA approve these Agreements, the project may go through. If the TIF and/or other Agreements are not approved, nothing will be built. MOTION by Marlaine Szurek, seconded by John Hunter, to approve the Initial and Cooperation Agreements for the Transition Block Redevelopment Project contingent on the addition of the proposed language or language substantially similar and acceptable to legal counsel for the City/EDA with the understanding that the Initial Agreement be changed to read One, two bedroom and two, three bedroom MHOP units wherever listed in the Agreement; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. All Ayes. MOTION CARRIED. 4) Community Development Block Grant Housing Rehabilitation Program. Mr. Anderson explained that we received a CDBG Housing rehabilitation loan application from the Center for Energy and Environment (CEE) which needs to be submitted to Anoka County after the EDA approves the loan. The property at 4149 4~h Street NE is planning on doing roof'mg, windows, doors, demolish the garage, install soffits and fascia, and fix plumbing, electrical, heating, exterior painting, gutter repair, replace kitchen cabinetry, as well as make health and safety improvements to the unit. MOTION by Donald Jolly, seconded by Pat Jindra, to approve the CDBG Housing Rehabilitation Grant Loan Application for Grant #C1997-03 in the amount of $14,475 for housing rehabilitation to Osborne Enterprises, and the Center for Energy and Environment subject to meeting all program requirements; and furthermore to authorize the Mayor and City Manager to enter into an agreement for the same. All Ayes. MOTION CARRIED. 5) Razing of Substandard Buildings. Mr. Anderson explained that the EDA has purchased three substandard properties with the intent of razing the buildings for redevelopment. The commercial building at 828 N.E. 40th Avenue, 3950 Lookout Place and 3944 Lookout Place. The City Council has declared the dwelling at 4358 N.E. 3~a Street a Hazardous Building, under Resolution 99-15. The Building Official and City Attorney will attend Anoka County Court on August 21, 2000 to seek the permission and assess the costs to the property in the form a special assessment. Staffis asking the Board to direct staff to draft demolition specifications for the projects, solicit bids for the projects and to direct the City Manager and Mayor to enter into a contract for the razing of the buildings with the lowest, responsible, qualified bidder. The project will be funded by 415 PIR Economic Development Authority Minutes August 16, 2000 Page 4 of 5 Abatement Funds. EDA owned properties will use CDBG Funds. MOTION by John Hunter, seconded by Marlaine Szurek to adopt Resolution 2000-59, authorizing staff to prepare specifications and solicit bids for the razing of 4358 NE 3~d S~-eet, 828 NE 40t~ Avenue, 3944 Lookout Place, and 3950 Lookout Place and furthermore; to authorize the Mayor and City Manager to enter into an agreement for the same. All Ayes. MOTION CARRIED. ADMINISTRATIVE REPORTS. A. Report of the Deputy Executive Director. 1) Property Sale Update - 4216 Central Avenue NE. Staffreceived plans last week from Mr. Nedegaard for this property. Currently, the planner is reviewing the new plans for any conflict with the City Code. City Council and the Planning and Zoning Commissioners approved the plan last fall. The City Planner is reviewing the plan to see if there is any substantial changes in the plans. If so, the plans would have to go before the City Council and Planning and Zoning Commission again. In discussion, Pres. Ruettimann asked if this can possibly be sold and settled by the end of summer if there are not any significant changes in the plans.'? Mr. Anderson stated that the original agreement stated that this project should be fmalized before the frrst oftheyear. Thenwe extended the agreement until spring of 2000. What staff is asking for atthis time is that the EDA extend this agreement using the same terms as used last time to extend it for another couple of months. Mr. Ruettimann wanted it recorded that the EDA did not own the property until March of 2000, so that we only had a verbal agreement with Mr. Nedegaard, not a purchase agreement. MOTION by Szurek, seconded by Jindra, that we extend the current purchase agreement between Mr. Nedegaard and the EDA until September 30, 2000. Ail Ayes. MOTION CARRIED. 2) Update on Acquisition of 3855 Main Street NE. Mr. Schumacher reported that he has finalized the Acquisition of 3855 Main Stxeet NE., Columbia Heights. The closing was held on Tuesday, August 15, 2000. At this point the options are for the City Council to sell the property to the neighbors on either side at a cost of $10,000 a piece and they would be willing to remove the blighted home at trek own expense thus making their property lots larger. The City Council could also sell the property to a developer to rebuild a new home on the land. Mr. Anderson indicated that the lot is 40 x 26 and approximately 5,063 sq ft. We generally consider a lot at 6,500 square feet to be a buildable lot size, however, there are provisions in the ordinance that allows you to go down to 3,900 square feet. 3) Downtown Master Plan. Mr. Anderson reported that the Downtown Master Plan was approved by the City Council last Monday night with the "Town Square" concept being the approved option. This plan will be presented to the EDA in September for approval. A copy oft.his Task Fome initiated plan will be given to the EDA Board members next week for review. 4) Community Fix-Up Fund. Mr. Anderson reported that staff has received a copy of the letters regarding the Discount Loan Program or Community Fix-Up Funds program that will be going out to residents of Columbia Heights with Cape Cod and Rambler homes informing them of the funds that Columbia Heights has available to them for upgrading these types of homes. These homes were constructed before 1970. Household incomes must be less than $78,890 to receive an interest rate between 2 and 6 percent depending on income. These letters should be mailed out in the next week or so to the Columbia Heights residents. B. Report of the Executive Director. C. Committee/Other Reports. Pres. Ruettimann verified that all cormmssioners have had a chance to read Miehelle Chalin's exit report. He expressed his feelings that this is a very valid report for both the EDA and Crest View Management. The EDA's thanks goes out to Crest View Management for providing this report. Economic Development Authority Minutes August 16, 2000 Page 5 of 5 MEETINGS A. The next Regular EDA meeting is scheduled for 6:30 p.m., Tuesday, September 19, 2000 in Commu- nity Room B at Parkview Villa. ADJOURNMENT. MOTION by Donald Jolly, seconded hy Pat Iindra, to adjourn the meeting at 8;02 p.m. All Ayes. MOTION CARRIED. Recording Secretary H~: EDAminutes~8-16-2000 The mission of the Columbia HeighTs Economic Developmen~ Authority is to provide financial and technical assistance and resources ~o residential, commercial, and industrial interests to promote health, safe~y, welfare, economic developmen~ and redevelopment. Memo To: From: Date: Subject: EDA Corrmaissioners, Walt Fehst, Executive Director: Randy Schumacher, Community Development Assistant; Anita Kottsick, Parkview Villa Public Housing Administrator; Karl Wilson, Housing Manager. Kenneth R. Anderson, Deputy Director ~ September 20, 2000 Initial and Cooperation Agreement minutes from EDA meeting of August 16, 2000. The Initial and Cooperation Agreement minutes from the EDA meeting of August 16, 2000 was not approved due to incorrect wording of the motion for this Agreement. The minutes have been corrected and at this time we would like to submit them for approval with the intent that the following amendment will replace the original motion as approved on August 16, 2000. MOTION by Marlaine Szurek, seconded by John Hunter, to approve the Initial and Cooperation Agreements for the Transition Block Redevelopment Project contingent on the addition of the proposed language or language substantially similar and acceptable to legal counsel for the City/EDA; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. Ali Ayes. MOTION CARRIED. H:\EDAminutesXlnitial and Cooperation Memo COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) REGULAR MEETING MINUTES OF SEPTEMBER 19, 2000 CALL TO ORDER - The Regular Meeting of the Columbia Heights Economic Development Authority (EDA) was called to order by President Ruettimann at 6:37 p.m., Tuesday, September 19, 2000, in the Parkview Villa Community Room B, 965 40~' Avenue NE, Columbia Heights, Minnesota. ROLL CALL Conunission Members Present: Commission Members Absent: Staff Present: Robert Ruettimann, Patricia Jindra, Don Jolly, Gary Peterson, Julienne Wyckoff, and John Hunter Marlaine Szurek Walt Fehst, Executive Director Ken Anderson, Deputy Executive Director Anita Kottsick, Parkview Villa Public Housing Administrator PLEDGE OF ALLEGIANCE ADDITIONS/DELETIONS TO MEETING AGENDA CONSENT AGENDA (These items are considered to be routine by the EDA Board of Commissioners and will be enacted as part of the Consent Agenda by one motion). Adopt the consent agenda items as listed below. 1) Approval of Minutes - regular meeting of August 16, 2000 and Special meeting of August 28,2000. MOTION by Don G. Jolly, seconded by Gary L. Peterson, to adopt the minutes of the Special Meeting of August 28, 2000 as presented in writing and table the minutes of August 16, 2000 until the minutes are corrected to read as stated on the recording tape of August 16, 2000. All Ayes. MOTION CARRIED. In discussion, President Ruettirnann expressed his concerns that the Initial and Cooperation Agreement motion was not written as stated at the August 16, 2000 meeting. Ken Anderson stated that the motion was changed due to the wording in the Initial Agreement being submined to Holmes & Associates, Inc. for the Mixed-Finance Development of the Columbia Court Townhouses project. He made the change and was going to amend the minutes at this meeting. Mr. Ruettimarm explained that this was not the proper procedure for handling this situation and asked staff to resubmit the minutes as stated at the October, 2000 meeting with an attached amended motion for the Initial and Cooperation Agreement section of the minutes. 2) Financial Report and Payment of Bills a. Financial Statement - August, 2000 b. Payment of Bills - August, 2000 MOTION by Don G. Jolly, seconded by Gary L. Peterson, to approve Resolution 2000-12, Resolution of the Columbia Heights Economic Development Authority (EDA) approving the financial statements for 2000 and approving payment of bills for August, 2000. All Ayes. MOTION CARRIED. REPORT OF THE MANAGEMENT COMPANY B. Anita Kottsick, Parkview Villa Public Housing Administrator. Ms. Kottsick highlighted a few things from her report. The large elevator passed inspection on September 7, 2000. However, on September 16~ the bearings burnt out which is under warranty and will be replaced. The Parkview Villa tenant annual re-certifications are taking place at this time. The Maintenance Coordinator is in the process of receiving bids on two issues, 1) to add water main shut off valves to each floor in the North building, and 2) additional fencing at 4607 Tyler. Parkview Villa North was experiencing problems due to having to shut offthe water supply for the whole building just to fix one area of the building. The intent is to have shut offvalves installed on each floor. For 4607 Tyler, Bill Gault is looking into the fencing costs due to residents reporting that people are cutting through the yard at all hours of the day. Economic Development Authority Minutes September 19, 2000 Page 2 Ms. Kottsick passed out an Intra-Building Relocation Policy to the Board members and stated that she has made some changes to the policy. A relocation fee of $I25.00 shall be paid by Parkview Villa residents relocating from one unit to another within the building who were on the relocation list prior to July 18, 2000. The Intra relocation fee of $400.00 shall be paid by residents on the relocation list after July 17, 2000. Ms. Konsick also invited the Board members to the Annual Fall Festival Picnic on Tuesday, September 26, 2000 at 5:30 p.m. and she also stated that she would be out of the office on September 20,21,22 at a seminar. Karl will be in the office to cover her duties. Some of the Commissioners will be attending the festivities to help out. CITIZEN FORUM TO ADDRESS EDA ON MATTERS NOT ON AGENDA. Mrs. Diane Powell, Unit 905, expressed her concerns about a f~re alarm going off in the building. The alarm went off for twelve minutes before the fire deparmaent came. Anita said it turned out to be smoke from a barbecue across the street from Parkview Villa and one of the tenants from Parkview had a window open, thus, tripping the fire alarm. Mrs. Powell also said that the 9* floor fire door did not close and asked if this could be fixed. Mr. Jolly stated that he was sure that the Fire Department would be more than willing to go over the Fire Procedures for residents. Mr. Fehst was asked by President Ruettimann to have the Fire Department check that the doors on all floors are properly functioning during an actual alarm and why it took twelve n~nutes to respond to the call. He also requested that the Fire Department do a Fire Procedural Presentation for the residents of Parkview Villa, possibly at a residents council meeting. ITEMS FOR CONSIDERATION A. Other Resolutions. 1) Performance Funding Systems Operating Subsidy. Ken Anderson explained that each year the EDA receives an Operating Subsidy to be used for Parkview Villa North from HUD for extraordinary maintenance and building repairs. For the year 2000 our Operating Subsidy was $51,070. In our Budget for 2001 we have budgeted $50,000 for our Subsidy. We have been asked by HUD to submit a Resolution approving thc Calculation of Performance Funding System Operating Subsidy. Staffis asking the EDA to approve Resolution 2000-13 for the Calculation of Performance Funding System Operating Subsidy for 2000. A part of the program includes the Drag Free Workplace which is also attached to the Resolution. MOTION by Julienne Wyckoff, seconded by Gary L. Peterson, to approve the EDA Resolution 2000-13, being a resolution of the Columbia Heights Economic Development Authority confaming approval of the Calculation of Performance Funding System Operating Subsidy for 2000; and furthermore, to direct the Executive Director to forward same to the U.S. Department and Urban Development. All Ayes. MOTION CARRIED. B. Bid Considerations. 1) Proximity Readers and Security Camera System for Parkview Villa. Mr. Anderson explained that staff and the Police Chief have been working with Trans-Alarm in regards to putting in a security system with Proximity Readers and Security Cameras for Parkview Villa North. Staff is submitting an estimate from Trans-Alarm for review and approval. The Proximity Readers would be similar to what the City Hall is currently using. Ken explained that the fa'st page of the estimate is for the Security Camera System which includes color camera viewing for better clarity, and all of the hardware necessary for a total of $13,694.21 which includes the labor, hardware and installation cost. If the Board would choose to go with black and white cameras there would be a $1,700.00 deduction in this amount. The second page is an estimate for the Proximity Reader System for a total package of approximately $28,000. Ia discussion, President Ruettimann commented that he had heard that the colored cameras project better images so he felt that it would be a good idea to go with the colored camera system. He also noted that the estimate was for only three cameras and he thought that we had talked about an estimate for four. Mr. Anderson said that this was correct and apologized for not having had a chance to look over the estimate as it just came in to the Commumty Development Deparmaent offic,, this afternoon. Ken was sure that they had talked about four cameras; one at the main entry, one at the south elevator lobby, one at the garage service door, and one at the exterior parking lot. Brace Vogelgesang did leave Ken a message saying that they did have some trouble determining where they could locate a second camera. When Ken and Brace met with the Police Chief they talked about having one on the North Economic Development Authority Minutes September 19, 2000 Page 3 building that would be facing out towards the parking lot and Bruce was proposing that we put a second one on the southeastern comer of the south building to have a view of the south side of the building where the entrance is on 40~ Avenue. President Ruettimarm stated that if the security viewing cameras would be positioned in the office at Parkview Villa and then when the office is closed, no one would view the tapes until the following day. Mr. Anderson stated that this was correct. A resident wondered why there has been duct tape on the garage door frequently, therefore anyone can get in without a key? In response, President Ruettimann stated that he felt that it was probably one of the residents in the building doing this and that the residents at the meeting tonight should all try to f'md out who this person is and explain that the door needs to be kept closed. She also asked if that door could be put on the same system as the north building where the door would lock when an alarm went off. Pres. Ruettimarm also suggested that this was something that could be brought up at the next residents meeting. Another resident asked if something could be done with the extra garbage that does not fit into the dumpster at Parkview Villa. It creates a smell that seeps into the units when the windows are open. Anita was asked to check into where the garbage overflow could be stored. It was the Boards decision to have staff request a quote for two more cameras for a total of five and check into what funds the $28,000 could come from. President Ruettimann would like to go through a building were the cameras are currently in operation. Mr. Hunter also wanted it noted that the estimate says that it expires in 30 days so we should get this extended. C. Other Business 1) Approval of Preliminary Agreement. Mr. Anderson stated that this is a request for the Board to consider approval of the Preliminary Agreement for the Transition Block Redevelopment Project. Wae proposal for construction of 22 rental townhouses and 50 assisted living units on property that is primarily owned by NEI College of Technology and a lot at 4150 Central the EDA ownes, and the lot currently owned by Citywide Locksmithing. This is the fifth draft of the Preliminary Agreement. Dan Greensweig, of Kermedy and Graven, Chartered, presented his overview of the Agreement to the Board. He stated that the most important thing to keep in mind is that it is a Preliminary Agreement and there are a number of items to be resolved. Among them is how is Crestview and Real Estate Equities going to f'mance their project, the status of the negotiations between Real Estate Equities and NEI, and the issues revolving around the Oslzander home. Some issues that he felt the Board needs to be concerned with are: 1) Real Estate Equities is agreeing to pay $10,000 to the EDA to be applied to the EDA's cost of the project at the time the con~:act is signed; 2) Realize that Real Estate Equities and/or Crest View would make the EDA whole; and 3) Indemnification of the EDA. The most important thing that the EDA should consider tonight is that if this is the kind of project that they would like to see in this area of the City then he felt that it would be a good idea to enter into the Agreement. If there are significant questions or concerns about the project, he felt that this would be the time to talk them out. In discussion, President Ruettimann said that last May the EDA approved the Cooperation Agreement for the Transition Block and he wondered how this Agreement related to that one. Mr. Greensweig stated that he believed that was the MHOP Agreement. Mr. Anderson confirmed this fact. Mr Greensweig also explained that after the EDA adopts the Agreement, then it would go to the City Council for approval. President Ruettimarm asked if we sign this Agreement and the development does not go through, does the EDA have any on going commitments? Mr. Greensweig responded that they could get out of the Agreement. President Ruegrimann asked Mr. Greensweig what kind of financing could be used for this development? Mr. Greensweig said there are two kinds of f'mancing, 1) Tax Increment Funds, and 2) Non-profit Bonds to be used for the Senior Units. Mr. Hunter asked how the payoffwould be handled, in thirds? Mr. Greensweig explained that the developer would not get any of the funding until the project was finalized and units occupied. Terry Troy, of Real Estate Equities, was also at the meeting and added that this and any other issues would be checked out by the Title Company before closing. Economic Development Authority Minutes September 19, 2000 Page 4 Mr. Hunter questioned if the City could possibly put a lien against the project to protect the City? Mr. Greensweig explained that if there was default on the project, the City would not be responsible for payment. He also stated that Crest View will have a big stake in this transaction so that the EDA shouldn't have anything to worry about. Brace Nawrocki, 1255 Polk Place, asked what would the overall total cost be for the project? President Ruettimann stated that it is 1.2 million for our cost and approximately ten million from private investors. Mr. Nawrocki stated he would like the total cost. Mr. Anderson stated it was originally a 1.2 million City investment and after some modifications it is up to a 1.5 million. Mr. Nawrocki was looking at a Tax Increment Financing Plan which the EDA Board had not received yet. Mr. Anderson stated that he was going to pass this Plan out to the EDA Board members under his report on the agenda. He explained that there were two handouts that he was going to be addressing in his staffreport; 1) the Proposed Tax Increment Financing Plan, and 2) the Transfer of Section 8. Mr. Anderson also explained that the City Council will be conducting a Public Hearing on Monday night for the Proposed Tax Increment Financing Plan. Mr. Nawrocki obtained a copy of this last night. These items will be discussed in the EDA's special meeting on Monday, September 25, 2000. Mr. Nawrocki stated that in the Budget section of the Tax Increment Financing Plan it is printed that $4,330,000 of up front monies will be used for the development. Mr. Anderson explained that generally it is good to have high figures in your budget for the Tax Increment Financing Plan because in the event that the cost exceeds the amount, the City Council and the EDA would have to conduct new Public Hearings for the difference. Therefore, in the past we have always allotted for a higher amount than necessary to prevent this timely process from occurring. He also added that the Tax Increment Financing Plan was prepared by our Financial Advisor, Springsted, Inc. and not by our Legal Council. Mr. Nawrocki had other questions about what was printed in the Proposed Tax Increment Financing Plan that the EDA members had jnst received. Therefore, since the EDA had jnst received the proposal, President Ruenimann asked Mr. Nawrocki to make a list of his questions and present them to the EDA Staff this week and they would provide him with some answers to his questions by the end of next week. President Ruettimaun also asked Mr. Anderson to provide him with a copy of the information that he will be giving to Mr. Nawrocki. MOTION by Don Jolly, seconded by Gary L. Peterson, to approve the Preliminary Development Agreement by and among the City of Columbia Heights and Columbia Heights Economic Development Authority and Columbia Heights Transition Block, LLC; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. All Ayes. MOTION CARRIED. 2) Housing TIF Study (Transition Block) Mr. Anderson explained that this was a request for the Board to approve payment to Springsted, Inc. for services related to the issuance of bonds, Tax Increment Financing Dislxict Analysis and preparation, and other financial services from March 2 through June 30, 2000. Staffhas attached a copy of the invoice from Sprmgsted, Inc. in the amount of $7,552.46. In the past, staffhas used a larger amount to cover any unscheduled meetings or expenses that may incur. These expenses will be reimbursed by the developer upon approval of the Preliminary Development Agreement. MOTION by Gary L. Peterson, seconded by Pat Jindra, to authorize expenditures to Springsted, Inc. up to $9,750 for the Transition Block Redevelopment Block Housing TIF Study and up to $5,000 for preparation of the '111~ Plan for TIF District number 9 with payment from the EDA Fund 204; and furthermore, to authorize the President and Executive Director to process payments as necessary. All Ayes. MOTION CARRIED. 3) Section 8 Report. Mr. Anderson explained that this will be the final Section 8 report as there is a special meeting of the Columbia Heights EDA and HRA scheduled for next Monday night, September 25, 2000, at 6:30 p.m. to approve the final Resolution and letters of transfer to the Metropolitan Council. 4) MHFA Loan Status Report. President Ruettimann questioned why the MHFA Loan Report came with only the loans above $5,000 and not all loans? Mr. Anderson explained that the reason for this is that any loan under $5,000 does not have to be filed with Economic Development Authority Meeting Minutes September 19, 2000 Page 5 Anoka County. Currently the EDA has two outstanding loans that were filed at the Anoka County Auditors office on September 7, 2000 by staff member, Cher Bakken. The Mortgages and Assignment of Mortgage will be returned with a file number on them approximately in 3 to 4 weeks and then staff will send a copy of the mortgages to MHFA. Mr. Anderson also passed out a letter that staffreceived today from Hal Rossi, of the MHFA in regards to the Shemey and Catherine Gafkjen Home Improvement Loan #1103055 that the EDA had asked for a pardon on the balance due to the situation. Mr. Rossi stated in the letter dated September 18, 2000 that the Columbia Heights Economic Development Department is responsible for the payment. Therefore, the EDA decided to place a motion into effect for payment. MOTION by Gary L. Peterson, seconded by .rolm Hunter, to approve payment to Compu-Link Loan Services, Inc. in the amount of $4,759.92 for the payoff of the MHFA Home Improvement Loan #1103055 for Shemey and Catherine Gafkjen account from Fund 204-46314-4600; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. All Ayes. MOTION CARRIED. ADMINISTRATIVE REPORTS A. Report of the Deputy Executive Director. 1) MCPP Update Mr. Anderson explained that he had included in the EDA Agenda packet a copy of the MCPP Ne~vletter for informational purposes only. In the newsletter it states that as of August 23, 2000, $2,299,999 remains of the original $29,948,470 released for First Time Homelmyer Loans in Anoka County. 2) Purchase of Ostrander House, 4157 Jackson Street N.E.. This item was added to the agenda at the meeting by Gary L. Peterson and President Ruettimann. Mrs. Soukup, the daughter of Ms. Ostrander, was present at the meeting. She stated that City staff was suppose to meet with her a week ago to tell her when the closing date would be on the property. She has not heard from the City staffyet. Mr. Fehst explained that he has been in contact with Mary Soukup in the last couple of weeks. The major hold up to the closing of the property is because NEI has not signed an Agreement with Real Estate Equities yet. President Ruettimann suggested that Real Estate Equities should move quickly on the purchase of the property. If they decide that they are not interested, he recommended that the EDA purchase the property and be reimbursed from the developer. He also asked that Ken and Walt meet with Terry Troy, Real Estate Equities on the Ostrander property and bring the specifics to the special EDA meeting on Monday, September 252, 2000. B. Report of the Executive Director-None. C. Committee/Other Reports. Pat Jindra reported that she attended two of the Resident Council meetings even though she is only required to attend them every three months. She submitted the reports to be filed with the Recording Secretary. The rmnutes will be printed up for the next EDA meeting in October, 2000. Don Jolly noticed that the carpet by the front door at Parkview Villa is moldy and the trees have not been trimaned. President Ruettimann asked that Anita Kottsick, Parkview Villa Public Housing Administrator check into these maintenance problems and get some estimates. Julienne Wyckoff asked what was the status of the two houses on Central Avenue that the EDA was going to possibly purchase? Mr. Anderson stated that Randy Schumacher hasn't been able to do very much with the property purchases due to staff working diligently on the Transfer of the Section 8 Program and TIF Reports that are both due in the next week or so. Once these two projects are completed, staff will continue to work on the purchase of the two Main Street properties. Mr Fehst also stated that staff has been working on TIF Reports, the Budget and the Transfer of Section 8, ail three projects are at high priority for their completion. Economic Development Authority Minutes September 19, 2000 Page 6 MEETINGS The next EDA meeting is scheduled £or 6:30 p.m., Tuesday, October 17, 2000 in Community Room B at Parkview Villa. ADJOURNMENT MOTION by Gary L. Peterson, seconded by Pat Jindra, to adjourn the meeting at 8:38 p.m. All ayes. MOTION CARRIED. Respectfully submitted, Cheryl Bakken Recording Secretary H:~EDAminutes\9-19-2000Mtg. COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) SPECIAL MEETING MINUTES OF SEPTEMBER 25, 2000 CALL TO ORDER - The Regular Meeting of the Columbia Heights Economic Development Authority (EDA) was called to order by President Ruettimann at 6:41 p.m., Monday, September 25, 2000, in Conference Room One, City Hall, 590 40t~ Avenue NE, Columbia Heights, Minnesota. ROLL CALL ComnUssion Members Present: Commission Members Absent: Staff Present: Robert Ruettimaun, Patricia Jindra, Marlaine Szurek, Don Jolly, Gary Peterson, Julieune Wyckoff, and John Hunter Walt Fehst, Executive Director Ken Anderson, Deputy Executive Director Randy Schumacher, Community Development Assistant Shirley Barnes, Crest View Corporation 1, Adoption of Resolution 2000-14 regarding Section 8 Administrative Transfer. Mr. Schumacher addressed the EDA Board asking for the EDA to adopt Resolution 2000-14 for the Section 8 Admhnstrative Transfer. To date, all Section 8 participant files are in order, re-certifications and physical inspections of all units have been completed. City staff has been working closely with both Metropolitan HRA staff and the local HUD office to fulfill all transition criteria in order to meet the projected October transfer date. Under state statue, a city may, be resolution, authorize another housing authority to act on its behalf with respect to any powers, as its agent, such as administration of its Section 8 Program. Formal action on such a resolution is required for this transition to take place. MOTION by Gary L. Peterson, seconded by Marlaine Szurek, to adopt Resolution 2000-14, transferring all administrative responsibilities for the operations of the Columbia Heights Section 8 Program and authorize all other related letters of intent be submitted to the appropriate agencies. All ayes. MOTION CARRIED. 2. Adoption of HRA/EDA and Metropolitan Council's Transfer Agreement. Mr. Schnmacher explained that the pink copy of this Agreement should be used and the HRA and EDA tonight are both adopting this Agreement to cover all standards by both HUD and the Metropolitan Council. The proposed agreement is a product of the Columbia Heights staff, Metropolitan HRA, and our Section 8 consultants. The agreement covers all aspects of the administrative transfer of the Columbia Heights Section 8 program over to the Metropolitan HRA. If everything goes as planned, the Liveable Communities Committee will be reviewing the agreement on Monday night, October 2, 2000, then the projected date of transfer is November 1, 2000. The client files will be delivered to Metropolitan HRA on October 4, 2000. It affects only the administration of the Section 8 Program, and makes no reference or has no impact on the annual contributions contract from HUD. MOTION by Pat Jindra, seconded by John Hunter, to enter into the Agreement governing the transfer of Federal Section 8 Housing Assistance Program administration within the City of Columbia Heights and have the President and Executive Director execute same. Ali ayes. MOTION CARRIED. In discussion, Walt Fehst stated that Randy Schumacher should be commended for his hard work in organizing and following through with this transfer of Section 8. Adoption of Resolution 2000-15 and Modified Redevelopment Plan for CBD Redevelopment Project and TIF Plan. Mr. Anderson explained that the Resolution before them is a redevelopment TIF district which has a maximum term of 25 years. The district boundaries include 4157 Jackson Street, (Ostrander residence), 825 41 ~ Avenue (NEI College of Technology), 4156 Central Avenue (City Wide Locksmithing), and 4150 Central (EDA property, formerly the Columbia Professional Building). The proposed budget for TIF eligible expenditures can be found on page 5 of the TIF Plan and are conservatively estimated to be $4,330,000. The actual cost will be actually less than this amount. This TIF district is subject to a local contribution (LGA penalty) of 5% of the annual TIF generated funds which must be provided from unrestricted money and cannot be taken from TIF. The Metropolitan Council grant of $545,000 can be used as the local contribution of the City which means no City funds need to be allocated for the local contribution requirement. Dan Greensweig of Keunedy and Graven, Chartered and Keith Jans of Real Economic Development Authority Minutes September 25, 2000 Page 2 Estate Equities was present at the meeting to answer any questions from the Board. The City Council has this on their agenda for tonight's meeting to conduct a Public Hearing but, at this time staffis recommending that this item be tabled and continued at a future meeting to allow the developer more time to move forward with the property acquisition and to make sure there aren't any changes that need to be made to the Agreement. However, staffis asking the EDA to adopt the Resolution tonight and forward it to the City Council for their Public Hearing. MOTION by Marlaine Szurek, seconded by Gary L. Peterson, to waive the reading of EDA Resolution 2000-15, there being ample copies available to the Public. All Ayes. MOTION CARRIED. MOTION by Marlaine Szurek, seconded by Gary L. Peterson, to adopt Resolution 2000-15, being a Resolution approving a modified redevelopment project and a Tax Increment Financing Plan for Tax Increment Financing District (Redevelopment) No. 9 (Transition Block Redevelopment Project - Crest View/Real Estate Equities). All Ayes. MOTION CARRIED. 4. Approve Relocation Proposal from Wilson Development Services. Mr. Anderson explained that the EDA received a letter on August 30, 2000, from Daniel Wilson, Wilson Development Services regarding the Relocatiun of residents at 3718 Cen~xal Avenue N.E., Columbia Heights. This property was one of two properties that the EDA was looking at purchasing. There are two residents living in the home. Dan Wilson's letter states an amount of $750.00 for time and material to evaluate the EDA's possible relocation liabilities. Staff is asking that the EDA approve payment to Wilson Development Services in the amount of $750.00 for relocation services. In discussion, President Ruettmmma asked what the status was of the resident at 3722 Central that the EDA was contemplating purchasing? Randy Schumacher reported that the person in the home is willing to move or relocate. The City is asking her for a waiver of Relocation costs. Which means that we would not be responsible for relocation costs. MOTION by Julieune Wyckoff, seconded by Pat Jincka, to award the proposal to provide relocation services at 3718 Central Avenue N.E. for a fee not to exceed $750.00 to Wilson Development Services; and furthermore, to authorize the President and Executive Dkector to enter into an Agreement for the same. All Ayes. MOTION CARRIED. ADJOURNMENT MOTION by Julienne Wyckoff, seconded by Pat Jindra, to adjourn the meeting at 7:01p.m. All ayes. MOTION CARRIED. Respectfully submined, Cheryl Bakken Recording Secretary H :LEDAminutes\Special Mtg.9-25-2000