August 23, 2021

REGULAR COUNCIL MEETING
CITY COUNCIL CHAMBERS, CITY OF ALBERT LEA
Monday, August 23, 2021, 7:00 P.M.

PRESENT: Mayor Pro Tem Larry Baker, Councilors Rich Murray, Reid Olson, Robert Rasmussen, and Al Brooks. Also present were Public Safety Director JD Carlson and City Clerk Daphney Maras.

ATTENDING VIA ZOOM: City Manager Ian Rigg, Public Works Director Steven Jahnke, City Attorney Kelly Martinez

ABSENT: Mayor Vern Rasmussen Jr. and Councilor Jason Howland

PLEDGE OF ALLEGIANCE

CEREMONIAL ITEMS

A. Oaths of Office – Albert Lea Police Department
B. Oath of Office – Albert Lea Fire & Rescue

OATH OF OFFICE
City Clerk Maras administered the Oath of Office to Police Officers Kristen Steinberg
and Nate Goette, as well as Fire Fighter, J.T. Bellrichard.

PUBLIC FORUM
Keith Haskell – Spoke regarding termination of the lease with the Interchange and his previous request to get on the council agenda. He spoke of his disagreement with the recently imposed mask mandate in City offices.

Lisa Hanson – Owner of the Interchange recited statements from the Constitution and spoke of her disagreement with the mask mandate.

Bernie Koslosky – Spoke of the termination of the Interchange lease agreement.

Sherry Ketterling – Inquired as to why the owner of the Interchange, Lisa Hanson, is required to continue paying rent when her lease was terminated. She spoke of a recent council item regarding a hazardous home. She asked what is being done about the City Attorney instructing another staff member, in her opinion, to unnecessarily push the panic button during a visit by Lisa Hanson. Spoke of her concerns of a time she came into City Hall to drop off papers to the HR Director.

Mayor Pro Tem Baker closed the public forum and read through the council agenda:

CONSENT AND APPROVAL OF AGENDA

A. Approve Minutes Of The August 9, 2021 Regular Council Meeting
B. Approve Minutes Of The August 9, 2021 Work Session
C. Approve Minutes of the August 10, 2021 Special Joint Meeting with Albert Lea Township
D. License & Permits
E. Resolution Approving Lawful Gambling Premises Permit – Albert Lea Union Center, Inc.
F. Resolution Authorizing City of Albert Lea To Enter Into Limited Use Permit No. 2405-0018 With Minnesota Department of Transportation – Non-Motorized Trail TH-65 / East Main Street (Job 1805)
G. Watershed Letter of Support Regarding Lessard-Sams Outdoor Heritage Council Grant Funding
H. Resolution Declaring The Official Intent Of The City Of Albert Lea To Reimburse Certain Expenditures From The Proceeds Of Bonds To Be Issued By The City

Motion made by Councilor Brooks to approve the consent agenda as read, seconded by Councilor Rasmussen. On roll call vote, the following councilors voted in favor of said motion: Murray, Olson, Rasmussen, Brooks and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.
(See Secretary’s Original Resolution 21-130 through 21-132
included with these minutes)

PETITIONS, REQUESTS, AND COMMUNICATIONS – None

UNFINISHED BUSINESS

A. Resolution 21-133 Adopting the City of Albert Lea Climate Action Plan
Rigg highlighted the details of this action plan and stated this is the work of many staff members, partnering agencies and consultants. Often the task of climate change seems to be too large for local government to act upon or local government is too small to make a difference. The reality is some of the most impactful public health and environmental improvements started at the local level. The plan is to set attainable goals and give guidance on how to achieve the larger goal of being better stewards of our environment. Even if some are unattainable, falling short of the goal is an improvement over not attempting. This plan will add direction for staff on how we review capital investment, planning, operations, partnerships, incentives and more. This plan was first submitted July 7th via email to Council for review. No requests for further review have been made.

Council exchanged dialogue and spoke of their support to adopt the proposed Climate Action Plan.

Motion made by Councilor Olson, seconded by Councilor Brooks. On roll call vote, the following councilors voted in favor of said motion: Murray, Olson, Rasmussen, Brooks and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.
(See Secretary’s Original Resolution 21-133
included with these minutes)

NEW BUSINESS

A. Public Hearing Regarding Reimbursement of Infrastructure Costs to Albert Lea Economic Development Authority (ALEDA)

Mayor Pro Tem Baker opened the public hearing regarding the reimbursement of infrastructure costs to the Albert Lea Economic Development Authority (ALEDA). He called three times. No one spoke. Baker closed the public hearing.

A1. Resolution 21-134 Permitting Reimbursement of Infrastructure Costs to Albert Lea Economic Development Authority (ALEDA)

Rigg then detailed this resolution explaining the City of Albert Lea (“City”) entered into an Agreement with ALEDA to reimburse infrastructure costs and provide impetus for the sale of commercial development of real property to Vortex Cold Storage LLC (“Vortex”). Vortex intends to use the property to build a minimum of 150,000 square feet of cold storage and related improvements. The development of the property will result in creation and retention of jobs paying quality wages, enhance economic growth, and expand the tax base of the local community. The City will pay ALEDA $20,000 per year for 20 years up to a maximum total amount of $400,000. Payments of $20,000 will be made annually to ALEDA commencing in January 2022 and will continue until December 2042. Vortex will be located at 311 14th Street East in the City of Albert Lea.

Motion made by Councilor Brooks, seconded by Councilor Rasmussen. On roll call vote, the following councilors voted in favor of said motion: Murray, Olson, Rasmussen, Brooks and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.

B. Resolution 21-135 of Albert Lea Township And The City Of Albert Lea Designating An Unincorporated Area As In Need Of Orderly Annexation And Conferring Jurisdiction Over Said Area to the Municipal Boundary Adjustments Office of the Office of Administrative Hearings Pursuant To Minn. Stat. § 414.0325

Rigg stated this resolution allows the City to complete the annexation process more timely and provides reimbursement of 5 years property tax loss to Albert Lea Township. This is not the final Council action for annexation. One property owner requested the final action be delayed to the September 27, 2021 meeting.
Motion made by Councilor Brooks, seconded by Councilor Rasmussen. On roll call vote, the following councilors voted in favor of said motion: Murray, Olson, Rasmussen, Brooks and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.

C. Resolution 21-136 Providing for the Sale of $7,155,000 General Obligation Water Revenue Bonds, Series 2021B

Rebecca Kurtz of Ehlers & Associates was present and explained the attached resolution will begin the process of the sale of the bonds for the demolition of the existing Central Water Tower and the construction of a replacement Central Water Tower. The bond also includes $155,000 of estimated issuance costs. Kurtz further explained it is anticipated the bonds would be paid 100% by water utility revenues over the term of the debt. However, because these are government obligation bonds, if water revenues were not sufficient to cover a debt service payment, the City would be obligated to levy taxes or find another funding source to make up any shortfall over the term. The proposed term of the bonds is for 21 years with principal paid in February 2023 – 2042. In February, 2030 or any time after, the City could refinance the bonds, pay in full, or restructure the bonds without penalty.

Kurtz said the bids for the sale of the bonds would be taken on September 27, 2021 and the results would be presented at the council meeting that evening. Should council choose to move forward with the sale of the bonds, the funds would be available on October 21, 2021.

Brooks asked for clarification of the difference in the cost from the original estimate approximately two weeks ago for the water tower replacement that came in just over $6 million. Kurtz explained the bonds being sold are assuming a project amount of $7 million. The project amount came from the Engineering firm that is drawing up the specs and plans for the demolition of the existing water tower and construction of a new one. The estimated $155,000 fees are related to fees for the bonds which encompass: cost of issuance, attorney’s fees, Ehler’s & Associates fees, rating bond, and county fees. Another estimated $85,000 is included for the underwriter’s fee, which is standard for a $7 million bond. Ultimately, the $7 million estimate is to ensure some of the unknown costs and contingencies are covered in order to complete the project.

To Murray’s question, Kurtz said the interest rate for the bond sale is estimated at 2.00%. Murray questioned where the revenue will be raised to make the bond payment each year. Kurtz explained that Ehler’s has worked with the City to complete a utility analysis for the water fund. It is estimated that there will need to be a 2% increase in water utility fees for an approximate 5 year term. She further clarified that Ehlers is proposing, based on estimates at this point in time, a 5% increase to the water fund which would cover not only the estimated debt service payments, but also the additional projects in the water capital improvement plan for the next five to ten years. This would be analyzed and adjusted on an annual basis.

Murray asked the amount of the built-in contingency fund. To which Jahnke responded it is at 10%.

Baker asked why a 1 million gallon water tower is necessary. Jahnke outlined the reasons stating first off, the Minnesota Department of Health recommends a one day supply be available at all times in case of an emergency. That alone requires 3.5 million gallons per day. In addition, a reserve is necessary in case of a large fire emergency. Lastly, a 1 million gallon tank allows for future business growth.

Motion made by Councilor Olson, seconded by Councilor Brooks. On roll call vote, the following councilors voted in favor of said motion: Olson, Rasmussen, Brooks and Mayor Pro Tem Baker. Councilor Murray voted Nay. Mayor Pro Tem Baker declared the motion passed.

D. Resolution 21-137 Authorizing City of Albert Lea to Enter Into a Credit Enhancement Agreement with the Minnesota Public Facilities Authority

Kurtz explained that adopting this resolution gives the City permission to use the State Credit Enhancement Program for the 2021B bonds. Any utility bond is eligible. The City can then issue debt with the current underlying rating and the State’s rating, which should result in lower interest rates. The cost of the program is $500 but staff anticipates saving more than that in lower rates.

Motion made by Councilor Olson, seconded by Councilor Rasmussen. On roll call vote, the following councilors voted in favor of said motion: Olson, Rasmussen, Brooks, Murray and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.

E. Ordinance 21-060 Amending Chapter 2 – Administration, Article VI – Boards, Commissions and Authorities (2nd reading)

The second reading of this ordinance would approve changes to the ordinance pertaining to Boards, Commissions and Authorities which are necessary to encourage and retain quality board and commission members. Rigg confirmed no changes have been made since the first reading of this ordinance.

Motion made by Councilor Brooks, seconded by Councilor Murray. On roll call vote, the following councilors voted in favor of said motion: Olson, Rasmussen, Brooks, Murray and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.

F. Resolution 21-138 Permitting Publication of Ordinance Summary Amending Chapter 2 – Boards, Commissions and Authorities

Ordinance Summaries may be published if they reasonably inform the public of the effect and intent of the Ordinance. Summaries fulfill all legal requirements as if the entire summarized matter had been published and also directs the public how to obtain the complete Ordinance. The effective date of enactment of the ordinance is August 23, 2021, and must pass by a four-fifths vote by Council.
Motion made by Councilor Brooks, seconded by Councilor Olson. On roll call vote, the following councilors voted in favor of said motion: Olson, Rasmussen, Brooks, Murray and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.

MAYOR AND COUNCIL REPORTS

First Ward, Councilor Murray reported:
• Ward Items – Spoke with City Manager Rigg related to the Climate Action Plan and the Water Tower construction and costs
• Committee Update – Attended an HRA meeting last week. Attended a Main Street “walking tour” with the CVB Director Holly Karsjens.

Second Ward, Councilor Baker reported:
• Ward Items – Working with staff on a couple of ward items.
• Committee – Attended the HRA meeting last week.

Third Ward, Councilor Howland reported: Absent

Fourth Ward, Councilor Olson reported:
• Ward Items – None
• Committee Update – Attended the HRA meeting last week where the discussion topic was changing employee work week from 5- 8 hour days to 4- 10 hour days. This was agreed upon and staff will be making that change shortly.

Fifth Ward, Councilor Rasmussen reported:
• Ward Items – None
• Committee Update – Attended the Library Board Meeting. He reported over $2,000 was raised in a recent book sale. The 2020-2022 library goals were reviewed. Attended an Airport Board meeting where the future changes to the runway configuration were discussed to make the airport more user friendly.

Sixth Ward, Councilor Brooks reported:
• Ward Items – He asked that staff look into the fire that took place at a home on Lee Avenue many years ago. The structure remains, but is severely damaged.
• Committee Update – None

Mayor Rasmussen: Absent

CITY MANAGER REPORT –
• Rigg said he will add the structure on Lee Avenue to his list and ask staff to look into the status.
• Continues to look into housing opportunities to improve housing in the community.
• The applications for the Community Engagement & Enrichment position was closed on Friday

APPROVAL OF CLAIMS

A. Resolution 21-139 Approving Claims
(1). Presentation of Claims Over $25,000
Rigg displayed claims over $25,000 providing detailed explanation of each.

Rigg explained that the attached resolution directs the Mayor and Treasurer to issue the payment of claims as presented in the Detail of Claims report.

Motion made by Councilor Murray, to approve payment of claims as presented for checks #79392 through #79537 in the amount of $445,220.97, seconded by Councilor Rasmussen. On roll call vote, the following councilors voted in favor of said motion: Murray, Olson, Rasmussen, Brooks, and Mayor Pro Tem Baker. Mayor Pro Tem Baker declared the motion passed.
(See Secretary’s Original Resolution 21-139
Included with these minutes)

ADJOURNMENT – 8:16 PM

Motion made by Councilor Murray, seconded by Councilor Olson, that there being no further business, the Council meeting adjourn until the next regular meeting of the Albert Lea City Council at 7:00 p.m., on Monday, September 13, 2021. On roll call vote, all councilors voted in favor of said motion. Mayor Pro Tem Baker declared the motion passed and the meeting adjourned.

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Mayor Pro Tem Baker

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Daphney Maras
Council Secretary