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HomeMy WebLinkAboutCity Council Packet 03-28-1994 SpecialCITY COUNCIL STUDY SESSION MONDAY, MARCH 28, 1994 5:45 P.M. Public Safety Training Room I. Discuss Conflict of Interest Policy - Carlson Companies Applications U. Discuss Subcommittees formation membership by subject area or standing committees M. Prioritize Topics for Discussion IV. Goals and Objectives CHARTER COMNIISSION -- 7:00 P.M. DATE: March 24, 1994 TO: Mayor and City Council FROM: Kathy Lueckert, Assistant City Manager AM/ SUBJECT: Conflict of Interest Policy Councilmember Helliwell has requested that the City Council spend some time on March 28 reviewing the City's Conflict of Interest Policy. This policy is attached for your perusal prior to Monday evening. 1 _NO I _ hY M 515351 As a general rule, if you have any question that you may have a conflict of interest on a matter that is before the City Council, it is advisable to confer with the City Attorney. In the past, when a potential conflict has been determined, Councihnembers have abstained from discussion and voting, or removed themselves from the Council Chambers. With certain exceptions, Minnesota laws forbid any mayor or councilmember to have a personal financial interest in or to benefit from the making of any sale, lease, or contract with the City. If, however, a mayor or councilmember is simply an employee of a fum and receives no commission, bonuses, or other remuneration directly from its contracts, and is not a stockholder, the council may enter into a contract with the organization for. which the officer works regardless of the amount of the contract. The City of Plymouth has adopted the attached policy establishing a code of ethics for councihnembers, board and commission members. The Code of Ethics Disclosure Form is completed annually by each member and kept on file as public information. There is an additional disclosure requirement imposed by the State Ethics in Government Act (Minnesota Statutes Chapter 10A). This requires local officials in cities in the metropolitan area with a population over 50,000 to file economic interest disclosures and conflict of interest disclosure statements. The City Council adopted the attached policy to direct which City officials shall file disclosure statements. These forms are completed annually and kept on file as public information. I POLICY ESTABLISHING CODE Or ETHICS FOR PLYMOUTH CITY .COUNCIL, BOARD AND COMMISSION MEMBERS Resolution No. 85-968 December 2, 1985 ( Supersedes Res. 82-343, July 12, 1982) The City Council of the City of Plymouth confirms its determination that ethical' standards among its members and members of the various city boards and commissions are essential to the proper conduct of municipal public affairs. By eliminating conflicts of interest and providing a guide for conduct in city matters, the City Council strives to promote the faith and confidence of the citizens of Plymouth in their government. The! following standards of conduct are intended to serve as guidelines for members of the City Council, boards and commissions in carrying out their public responsibilities. This policy is in addition to any statutory requirements, attorney general opinions or court rulings which prescribe allowable actions for City Council, board and commission members. Standards of Conduct 1. Councilmembers or members of any board or commission, shall not use their positions to secure special privileges or exemptions for themselves or others or to intentionally jeopardize the position or employment of others. 2. Councilmembers or members of a board or commission may not participate in deliberations in any matter before the Council, board or commission which affects that member's financial interests directly or indirectly or those of a business with which the member is associated. Whenever such conflict is recognized, the affected members shall disclose for the record such interest prior to any discussion or vote and disqualify themselves from any further official activity on the issue. 3. Councilmembers or members of a board or commission shall not act as an agent or attorney for another in any matter before the City Council or any board or commission or before any court, administrative board or tribunal in any matter in which the City is a party. 4. Councilmembers or members of a board or commission shall not directly or indirectly receive, or agree to receive, any compensation, gift or reward or gratuity as an inducement to support or influence any matter or proceeding connected with, or related to, the duties of the office. 20- I 5. Councilmembers or members of a board or commission shall not enter into any contract with the City of Plymouth. Any Councilmember or member of a board or commission who is an officer director, partner, agent, proprietor or employee of any firm or has a proprietary interest of 10 percent or more in any company, business, enterpriseor corporation, partnership, labor union or association doing business with the City shall make known that interest in writing as provided in the Disclosure Section of.this policy. No later than (30)' thirty days after the date of the adoption of this policy existing Council, board and commission members shall receive a copy of this policy and the disclosure form and return the completed form to the City Clerk. Council, Board and Commission members, elected or appointed, shall no later than 30) thirty days following election or appointment to office and each year thereafter by December 1, complete the disclosure form and return it to the City Clerk. All subsequent applicants for membership on City boards and commissions shall file a completed disclosure form together with the application form for Board/Commission membership. Within thirty (30) days after the acquisition or sale of any property, each Councilmember or member of a board or commission shall file as a public record with the City Clerk, a list of all real property in the City of Plymouth owned by such person, that person's spouse, or child, or in which the member has a beneficial interest, disclosing each individual item held, and by whom. Homestead shall be excluded from the above disclosure. Each Councilmember and member of a board or commission shall disclose all positions as officer, director, partner, agent, proprietor or employee of any firm in which such member has a proprietary interest of 10% or more in any company, business, enterprise, corporation, partnership, labor union or association doing business with the City of Plymouth, and indicate with respect to each such relationship whether services are gratuitous or for compensation.. The disclosure information required by this policy shall be set forth on a form which shall be made available by the City Clerk. DisciRline upon the signed written complaint of any person questioning adherence to this policy or on the Council's own volition, the Council shall refer the matter to the City Attorney for investigation and the City Attorney shall report the results of his investigation to the City Council within 45 days thereafter. A copy of such report shall be furnished to the person complained against. Such person may request a hearing on this matter before the Council which request shall be filed with the City Clerk not later than 10 days following receipt by such person of the City Attorney's report. 20- Upon receipt of the City Attorney's report and at the conclusion of any hearing on the matter, the Council by majority vote may dismiss the complaint as having no merit, may adopt a resolution of censure, or with respect to members of advisory boards and commissions, the Council may remove a member from such board or commission. In the event the complaint is against a member of the City Council, such member shall not participate in the Council's deliberations or vote with respect thereto. 20- ROBERT L. CROSBY LEONARD M.ADDINGTON ROBERT R. BARTH N. WALTER GRAFF ALLEN D. BARNARD RICHARD A.PETERSON ROBERT J. CHRISTIANSON, JR FRANK J. WALz FRANK VOGL MARINUS W. VAN PUTTEN, JR DAVID B -MORSE JOHN A. BURTON, JR. JAMES C.DIRACLEB ROBERT L.MELLER,JR. JUDITH A.R000SHESKE BEST & F LANAGAN ATTORNEYS AT LAW SCOTT D•ELLER CHARLES C. BERQUIST GEORGE O.LUDCKE E.JosEPH LAFAVE GREGORY D.SOULE CATHY E. GOBLIN PATRICK B-HENNESSY TIMOTHY A. SULLIVAN BRIAN F. RICE DANIEL R.W. NELSON TRACY J. VAN STEENBURGH DAVID J.ZUBKE STEVEN R.KRUGER JAMES P. MICHELS PAUL E.KAMINSKI 4000 FIRST BANK PLACE 601 SECOND AVENUE SOUTH MINNEAPOLIS, NIN 55402-4331 TELEPHONE 16121 330-7121 TELECOPIER 16121 339-5897 February 10, 1994 Mr. Dwight Johnson City Manager City of Plymouth 3400 Plymouth Boulevard Plymouth, MN 55447 RE: Conflict of Interest Issue Dear Mr. Johnson: CINDY J. LARSON OF COUNSEL JOHN P. BOYLE JOHN R.CARROLL ROSS C.FORMELL JAMES D. OLSON CARYN SCHERB GLOVER ROBERT M. SNARE MARY E.SHEAREN ARCHIBALD SPENCER CATHERINE J. COURTNEY WARD B.LEWIS KEITH J. NELSEN r BARBARA M. Ross TRACY F. KOCHENDORFER JEANNICE M.REDING SARAH CRIPPEN MADISON JAMES 1. BEST ROBERT D. MAHER 1802 -Igoe DAVID H. JOHNSON ROBERT J. FLANAGAN WILLIAM J. MORRIS 1888-1974 MICHAEL L.DIGos MICHAEL H. PINK Enclosed is a copy of the letter that Robert Meller has forwarded to Sheryl Morrison regarding her conflict of interest question. Also enclosed are additional copies of the letter for distribution to the members of the City Council. Enclosures kjd\JohnsonA tr Very truly yours, K thryn J. ahl Legal Secretary r ROBERT L.CRosaY LEONARD M.ADDINGTON ROBERT R.BARTH N. WALTER GRAFF ALLEN D. BARNARD RICHARD A.PETERSON ROBERT J. CHRISTIANSON, JR. FRANK J. WALz FRANK VOGL MARINUS W. VAN PUTTEN,JR. DAVID B. MORSE JoaN A.B URToN, JR. JAMES C.DIRACLES ROBERT L.MELLER, JR. JUDITH A.R000SHESKE BF -ST & F LANAGAN ATTORNEYS AT LAW SCOTT D•ELLER CHARLES C. BEROUIST GEORGE 0•LUDCKE E.JOsEPH LAFAVE GREoORY D. SOULE CATHY E.GORLIN PATRICK B.HENNESSY TIMOTHY A. SULLIVAN BRIAN F. RICE DANIEL R.W. NELSON TRACY J. VAN STEENBUROH DAVID J. ZUBKE STEVEN R.KRUGER JAMES P. MICHELS PAUL E.KAMINSKI 4000 FIRST BArK PLACE 301 SECOND AVENUE SOUTH MINNEAPOLIS, 211N 55402-4331 TELEPHONE ( 6121 339-7121 TELECOPIER (612) 339-5897 February 10, 1994 Ms. Sheryl Morrison Mackall, Crounse & Moore 1600 TO Tower Minneapolis, MN 55402 Dear Sheryl: CINDY J. LARSON JOHN P. BOYLE Ross C.FoRMELL CARYN SCHERB GLOVER MARY E.SHEAREN CATHERINE J. COURTNEY KEITH J. NELSEN BARBARA M.Ross TRACY F. KocHENDORFER JEANNICE M.REDING SARAH CRIPPEN MADISON ROBERT D. MAHER DAVID H.JOHNsON WILLIAM J. MORRIS MICHAEL L.DIoos MICHAEL H. PINE OF COUNSEL JOHN R.CARROLL - JAMES D. OLSON ROBERT M.SEARE ARCHIBALD SPENCER WARD B.LEWIS JAMES I.BEST 1000-1088 ROBERT J. FLANAoAN 1888-1074 You have asked this office to research whether a conflict of interest issue is presented by the fact that your law firm has represented Carlson Companies. This issue arises because of Carlson Companies' application for reguiding and rezoning for a Sam's Club. The statutes dealing with public offers and conflict of interest speak to any interest a public officer has in a contract. For example, the general statute applying to all municipalities is Minnesota Statute § 471.87, which reads: Except as authorized in § 471.88, a public officer who is authorized to take part in any manner in making any sale, lease or contract in his official capacity shall not voluntarily have a personal financial interest in that sale, lease, or contract or personally benefit financially therefrom. Every public officer who violates this provision is guilty of a gross misdemeanor." A similar prohibition is contained in the City Charter, Chapter 12, Section 12.03 which states: Except as otherwise permitted by law, an officer of the city who is authorized to take part in any manner in a contract with the city in an official capacity, may not voluntarily have a personal financial interest or personally benefit from the contract." Ms. Morrison February 10, 1994 Page 2 The City Policy Handbook, on page 20, contains a Policy Establishing Code of Ethics for Plymouth City Council, Board and Commission Members. That policy notes that the "City Council strives to promote the faith and confidence of the citizens of Plymouth in their government." The policy lists a number of Standards of Conduct" including: Council members or members of a Board or Commission may not participate in deliberations in any matter before the Council, Board or Commission which affects that member's financial interests directly or indirectly.or those of a business with which the member is associated. Whenever such conflict is recognized, the affected members shall disclose for the record such interest prior to any discussion or vote and disqualify themselves from any further official activity on the issue." Keeping the above broad principles in mind, we conclude that you are not required to abstain from deliberations on Carlson Companies' application for reguiding and rezoning for the Sam's Club project. This opinion is based on the assumption that your firm is not working with Carlson Companies in any way on this particular development project. This opinion is also based upon the assumption that you will not receive any direct or indirect compensation or benefit as a result of a granting of Carlson Companies' request. Our opinion is bolstered by Attorney General Opinion 90a-1, October 7, 1976 which concluded that a council may contract with a council member's employer where the member: 1) has no ownership interest in the firm; 2) is neither an officer or a director; 3) is compensated on a salary or hourly wage basis and receives no commissions, bonus or other remuneration; and 4) is not involved in supervising the performance of the contract for the employer and has no other interest in the contract. While the situation you present is not one of the city contracting with your firm, nonetheless, this Attorney General Opinion indicates that conflicts arise when there is the potential for direct benefit. From what you have told us, that is not the case here. Ms. Morrison February 10, 1994 Page 3 You should, of course, feel free to seek independent counsel on this question. In addition, you certainly have the right to abstain from voting on this matter if you feel that an appearance of impropriety is raised. To reiterate,'however, based on our understanding of the facts, you do not have a conflict and can vote on the Carlson Companies application. It would also be appropriate when.the issue comes forward to explain your firm's representation of the applicant in unrelated matters, that you have reviewed this issued with this office, and we have opined that you can vote on the issue. Please ddnft hesitate to contact us if we can be of any further assistance. Y very truly, ber L.WMeler,lr. City Attorney PEK:kjd cc Dwight Johnson, City Manager City Council PEK\Morrison.ltr DATE: February 10, 1994 TO: Mayor Joy Tierney nt r Councilmember Carole Helliwell ;` , 'G>' h Councilmember John Edson Councilmember Nicholas Granath Councilmember Chuck Lymangood Councilmember David Anderson cl FROM: Councilmember Sheryl G. Morrison ` '1<` I , SUBJECT: Sam's Club Conflict of Interest I have attempted to inform most of you with whom I have spoken over the last weeks about the above matter, however, I know I have missed informing a couple of you. I, therefore, wanted to formally inform all Councilmembers of the above issue. This history of this matter to date is as follows: On January 31, 1994, I had my staff check my computer conflicts system for any potential conflicts regarding upcoming issues I might be reviewing and determining in my duties as a City Council member. I was informed that Carlson Companies and its subsidiaries, Country Kitchens, Country Hospitality and Country Lodging, all registered as clients of the law firm. I then met with Larry Commers, a partner who joined our firm in September of 1993, who has been the principal attorney in the firm involved with this client. I was informed that our representation has been limited to franchising for the above- named subsidiaries, miscellaneous litigation for some of the hotels, and one real estate litigation in another state where Carlson Real Estate was a party. Mr. Commers has not represented, and doesn't anticipate representing this client in any real estate transactions or municipal involvement in Minnesota or elsewhere. I have never been involved in any of these matters or with this client. I was then informed by our professional responsibility advisor at the law firm that this does not pose an impermissible conflict of interest in my duties as an attorney. I then contact Bob Meller of Best & Flanagan on February 3, 1994 to ask for his opinion about whether this posed a conflict in my duties as a City Council member. He indicated he did not think an impermissible conflict existed, however, he would check a bit further. I then received a telephone call from Paul Kaminski at Best & Flanagan on February 7. He informed me that their further discussions and research indicated that no conflict existed. He also indicated that they would issue an opinion letter and copy all Councilmembers. I am awaiting an opinion letter from Best & Flanagan which disposes of this issue. However, pending receipt of that letter, I wanted to formally disclose this issue 'to the Mayor and Councilmembers. Assuming the letter will opine along the same lines as we verbally discussed, I beleive that no conflict of interest exists and I am legally capable of voting on this issue when it arises. My last concern would be whether any Councilmember believes there is any appearance of impropriety in these circumstances. If so, I would like to -discuss this issue further. Also, if anyone has any questions regarding this matter, please call me. cc: Mr. Dwight Johnson Mr. Robert Meller 11187450_1 DATE: March 24, 1994 TO: Mayor and City Council FROM: Dwight Johnson, City Manager SUBJECT: COUNCIL SCHEDULE OPTIONS 1. BACKGROUND: The Council is considering how best to organize and schedule itself to effectively meet a challenging list of issues. Specifically, we are preparing to discuss the creation of subcommittees to accomplish this work. 2. STATEMENT OF PROBLEM: Staff has a major concern about the subcommittee proposal and its impact on our ability to serve you and the City. We respectfully request that you reconsider and discuss other options. 3. DISCUSSION OF PROBLEM: The current workload for the Council is undeniably high at this time. The current study session schedule is not working well to meet this workload, primarily due to the effective time limit of one hour or less. New ideas for meeting our workload are certainly in order. However, the staff has major concerns about extensive use of a council subcommittee system primarily due to its impact on staff. We believe it is inevitable that staff will be involved in several extra meetings each week with these new subcommittees. We will need to organize these meetings, prepare reports, agendas and minutes, but most of all we will need to take the time to attend them. These subcommittees will also require us to considerably compress our staff schedules for many important items, since we will now need to be ready with information, costs, options, etc. days or weeks sooner than a normal agenda process would require. Since preparation time for a meeting often exceeds the time the meeting actually takes, we expect extensive use of a subcommittee system could add 4-8 hours per week to the schedules of the top staff members. While this may not seem intolerable, please refer to the attached time profile I have developed for myself based upon last week's activities. (I decided to do this for myself well before I learned of the subcommittee proposal and had not necessarily planned to share it COUNCIL SCHEDULE OPTIONS March 24, 1994 Page 2 with anyone). While the time profile shows my activities for last week, it is presented because it is typical of most department directors as well. The profile indicates that I actively participated in 23 major issues that week. There are some very important issues and problems that received only a few minutes of my attention last week. How many of these 5, 10, or 15 minute meetings will be lost, meetings where some of our best ideas emerge? This week I am meeting with all employees in chat sessions. These meetings have been very positive so far. But Kathy and I definitely feel stretched two ways to spend enough time with both the employees and the Council. The importance of spending enough time with the employees should not be underestimated in the long run. Please remember that we are running the daily operations of a $20 million business. Your top staff is very reluctant to tell you when we are in trouble. We have pride and believe we can handle almost any challenge. But we would be remiss not to tell you of our serious concerns that could very noticeably detract from the quality of our work. Please consider some alternatives. 4. ALTERNATIVES: The alternatives that seem to exist to meet a period of high Council workload include: 1. Create a subcommittee system. 2. Continue the status quo of short study sessions of about an hour every Monday evening. 3. Meet on several Saturdays to catch up. 4. Meet in study session every off Monday night at 7:00 p.m. for about 2-1/2 to 3 hours until about Memorial Day. 5. CONCLUSION: Staff prefers the alternatives in inverse order. We believe the best solution is alternative 4, with one or two Saturday meetings included if necessary. We do not believe that this Council workload will continue all year. Several of us have served new Councils before and have observed that there is a high tide" of activity in the first six months. Alternative 2 is not working well while alternative 1 creates side effects that will make it too difficult for staff to meet all of its responsibilities to you, the organization, and the citizens. While the major concern of this memorandum is staff effectiveness in serving you, most top staff members have served in other jurisdictions which have used subcommittees. Plymouth has also tried subcommittees with the budget process a few years ago. Staff considers all of these attempts, both here and elsewhere, to y COUNCIL SCHEDULE OPTIONS March 24, 1994 Page 3 be unsuccessful because both staff work and meetings ultimately had to be duplicated. The 1994 Plymouth Council is learning fast, but is still in a mode where all members need a broader understanding of City finances, capital improvement plans, and overall City comprehensive plans. This can best be accomplished by continuing to meet and work together as a group to face our common challenges. But even if the Council disagrees with staff's interpretation of past experiences, please consider staff effectiveness in your deliberations about our future working relationship with you. Thank you. DJ:keb IF MONDAY, MARCH 14, 1994 08:00-08:15 Talk to Dan Faulkner about engineering candidates; discuss "midnight bowling." 08:15-08:30 Receive two phone messages from councilmembers 08:30-08:45 Talk with Kathy on City Attorney issue See Anne about Carlson Financing meeting Meet Civil Engineering candidate 08:45-09:00 Talk to Councilmember on phone 09:00-10:00 Meet with Carlson Company on bond refinancing 10:00-10:15 Meet with Craig 10:15-10:45 Meet with Kathy on council agenda items 10:45-11:00 Receive six phone messages: one outside, two department heads, three councilmembers 11:00-11:30 See Eric 11:30-12:15 See Dan Faulkner on engineering candidate Go to District 284 to see Supt. Landswerk with Eric 12:15-1:10 Lunch 1:10-1:15 Receive call from Supt. Landswerk Call Eric 1:15-1:30 Brief conversations with to Craig, Eric, Kathy, and Laurie 1:30-1:40 Listen to phone message 1:40-1:55 Called Mayor 1:55-2:15 Phone call wih council member 2:15-2:30 See Fred on RR Crossings and misc items 2:30-2:50 Call councilmember and leave message Call Mayor Call councilmember and leave message Call councilmember Receive one phone message 2:50-3:05 Talk to Kathy 3:05-3:15 Talk to Anne on HRA memo 3:15-3:20 Talk to Kathy on City Center memo 3:20-3:25 Set up meeting to review personnel matter 3:25-3:30 Arrange letter to Sen. Limmer 3:30-3:35 Call industrial prospect representative 3:35-3:45 Work on schedule for rest of week 3:45-4:30 Talk to Kathy; reschedule a meeting; prepare for employee chat sessions; discuss personnel matters 4:30-5:00 Review in -box and read council reports 5:00-5:15 Talk to Kathy 5:15-6:00 Review staff reports 6:00-6:10 Meet with Eric on land acquisition 6:10-6:20 Review Capital Improvement Program map 9:00-9:45 Review CIP program summaries TUESDAY, MARCH 15, 1994 8:00-8:15 Receive one phone message; Talk with Kathy about Capital Improvements Program (CIP) 8:15-9:20 Prepare evaluation form 9:20-9:40 Talk to Anne about Hunt development 9:40-11:30 Talk with Fred about CIP 11:30-12:50 Staff Meeting 12:50-1:00 Receive four phone messages 1:00-1:55 Lunch 1:55-2:10 Verify MSA fund cash flow in CIP 2:10-2:30 Read and review HUD workout plan 2:30-2:45 Phone messages from Mayor and one council member 2:45-3:10 Meet with Kathy, Jeanette 3:10-3:30 Return two outside phone calls 3:30-5:00 Attend wetland regulations meeting for developers 5:00-5:45 Work on CIP; meet with Fred and Kathy 5:45-6:00 Receive two phone calls: Anne, councilmember 6:00-6:10 Talk with Fred 6:10-6:15 Leave phone message with council member 6:45-7:05 Read reports and memos WEDNESDAY, MARCH 16, 1994 7:55-8:00 Talk to John Keho about wetland meeting 8:00-8:25 Prepare personnel evaluation 8:25-9:00 Talk to Jeanette 9:00-10:15 Conduct employee evaluation; brief discussion with council member 10:15-10:30 Meet with Helen on Plymouth News policy 10:30-10:45 Review council reports; talk to Fred 10:45-11:15 Talk to Eric about house acquisitions, CIP 11:15-11:30 Talk to Dan Faulkner about stop sign report 11:30-11:45 Receive and respond to four phone messages: 3 staff, 1 councilmember 11:45-12:00 Council reports; phone message to all council members on state auditor report 12:00-1:00 Lunch 1:00-1:10 Receive phone message from council member 1:10-2:20 Talk to Kathy about personnel matters 2:20-3:00 Read Council reports 3:00-3:15 Talk to Anne about outdoor storage council report 3:15-3:25 Return phone call 3:25-3:45 Talk to Jeanette 3:45-4:05 Talk with Joe Ryan: Parkers Lake home issues 4:05-4:30 Return phone call; talk to Anne. 4:30-5:45 Meet with industrial prospect, Mayor and councilmember 5:45-6:00 Talk with councilmember 6:00-6:30 Review State Auditor's Report 10:00-10:15 Further review State Auditor's Report THURSDAY, MARCH 17, 1994 7:50-8:50 Attend wetland regulation meeting for developers 08:50-09:00 Talk to Kathy about State Auditor's report 09:00-11:00 Staff Meeting 11:00-11:30 Review council reports 11:30-11:45 Prepare for employee evaluation 11:45-12:30 Lunch 12:30-2:00 Employee evaluation 2:00-2:50 Meet with all supervisors about State Auditor's Report 2:50-03:30 Finalize agenda; process agenda request from a councilmember 3:30-3:50 Phone call with councilmember 3:50-4:30 Time off for charitable work 7:00-9:45 Attend HRA meeting FRIDAY, MARCH 18, 1994 8:00-8:30 Get phone messages 8:30-8:55 Talk to Kathy about chat sessions, HRA 8:55-1:40 Participate in symposium in Brooklyn Park on City Attorney services, especially in-house vs. contract attorney issue 1:40-2:00 Receive 11 phone messages 2:00-3:00 Meet with Kathy and Jeanette 3:00-4:10 Employee evaluation 4:10-5:20 Meet with Mayor SATURDAY, MARCH 19 and SUNDAY, MARCH 20 Review City Center Plans 30 minutes Type and analyze time report 90 minutes LIST OF ISSUES ADDRESSED DURING WEEK OF MARCH 14 From Work Diary of City Manager) In-house engineering candidates City Attorney issue Carlson Company bond refunding request Drive-by shooting incident New High School/land acquisition/meeting with 284 school board Acquisition of homes/W. Medicine Lake Park Project Railroad crossings Staffing for Community Development Department City Center expansion Personnel evaluations (3) Legislation Industrial prospect Prepare for employee chat sessions Review Capital Improvements Program Daniel Hunt development issues Letter to HUD on non-compliance finding regarding timely expenditure of funds Wetland regulations proposals/public meetings Plymouth News policy Speeding complaints/stop sign requests State Auditor's Report Outdoor Storage application -Planning Commission Parker's Lake homeowners complaints Future council meeting schedule 03-24-1994 14:49 612 339 5897 BEST&FLANAGAN P.02 ROBERT I.AA108RY LEONARC M.ADDINOTON ROBERT R.BABTH N•WALrER GRArr ALLEN D. BARNARD RIOHAnD A.PETERRON ROBERT J. CHRISTIANSON, JR FRANK J. WALZ FRANK VOOL MARINUB W. VAN PUTTEN,JR. DAVID B.MORpIE JOHN A.BuRToN,.JR. JAMES C. DIRACLES ROBERT L.MELLER,.JR. JUDITH A.R0009HEORE SCOTT D. ELLER BEST & FLANAOAN ATTORNEYS AT LAW CHARLEa VAIEROMBY GEonoE 0.LuDc9E E.JonxPH LAFAVE GRZOORT D.SOULN CATHY E.0oRI.IN PATRIOx B. HENNEBBY TIMOTHY A.$OLLIVAN BRIAN F. RIcE DANIEL R.W. NLLBON TRACY J.VAN STEENDUROH DAvIII J. Zunxr STEVEN R.KRIJOER IAMEB P. MIOHELB Pmm E. MINSEI 4000 FIRST BANK PLACE 001 SECOND AVENUE SOUTH MINNUAPOLIB, MN 175402-43 31 TELEPHONE 10ISV 000 - 71$1 TELECOPIER 10121 1300-0967 JOHN OYLE Rosa <.%.FORMELL Writer's Direct Dial No. 612) 341-9715 March 24, 1994 BY FACSIMILE Mr. Dwight Johnson City Manager City of Plymouth 3400 Plymouth Boulevard Plymouth, Minnesota 55447 RE: Subcommittee proposal Dear Dwight: CINDY J. LARaox Or COUNOML CARYN SCNERB GLOVER JOHN R.CARROLI. MARY E. SHEAREN JAMER II. OLAON CATHERINE J. COURTNEY RonERT M.SRARz Kr.ITH J. NZLREN ARCNInALD ?rENOER BARnARA M.Roaa EWARDB.LwIH TxACY F. KocHCNDONr_R JEANNIcE M.RsnINn SARAH GBIPPLx MADIaON ROBERT D. MAxER D"m H.JoHN9oN JAMES I. HEST WILLIAM J. MORRIS 1909-1906 MIcHAEL L.DIOOa ROBERT J. FLANAOAN MICHAEL H. PINK 160a-1974 You have raised certain questions relating to the proposal of the council to create subcommittees to deal with specific topics or areas of import. z have attempted to address your questions in the paragraphs below. 1. Subggmmittees. City councils may establish special and standing subcommittees to review various areas of the council's business. Special committees deal with single transactions or projects. standing committees concentrate on work which is continuous or repeated from time to time during the year. For example, some cities establish a standing committee on finance. Because the Minnesota Statutes do not specifically provide for specific committees, council action is necessary to establish them by motion or resolution. Committees may conduct investigations and make recommendations to the council. However, committees may not make decisions on behalf of the council. Committees are subject to the same rules as the full council under the Open Meeting Law. 2. Ops} Meeting Law. Since the council subcommittees will be established to discuss public business, they are subject to the Open Meeting Law and must be open meetings and noticed as required by the Open Meeting Law. The only time a meeting would 03-24-1994 14:50 612 339 5897 BEST&:FLANAGAN P.03 Mr. Dwight Johnson March 24, 1994 Page 2 not be open to the public would be if one of the exceptions to the Open Meeting Law applied and a closed meeting was specifically authorized. Note that since the Open Meeting Law applies, a quorum of a subcommittee (say, two members of a three member.committee, for example) cannot meet and discuss city business without giving public notice and conducting an open meeting. This presents a potential danger for councilmembers because the possibility of inadvertent violation of the Open Meeting Law increases when the council creates several subcommittees that have small memberships. In other words, a chance meeting of two councilmembers who constituted a quorum of a three member committee could be construed a violation of the Open Meeting Law. 3. u es. Since these meetings of subcommittees are conducting business for the council, it is necessary that minutes be taken of each meeting. I hope this is sufficient for your purposes. Do not hesitate to call with any further questions. Very tru yours, Allen D. Barnard ADB:rys adb\plycoun.ltr STUDY SESSION TOPICS A = HIGH PRIORITY B = MEDIUM PRIORITY C = LOW PRIORITY TOPIC RATING Capital Improvement Program A Review Conflict of Interest Policy A City Attorney A Parkland Acquisition - High School A Joint Meeting with District 284 A Parkland Acquisition - West Med. Park B City Center Expansion - Review Final Plans B Utility Rates/Bills B Northwest Clubs B Program Budgets B Economic Development Strategy B Joint Meeting with Planning Commission B Springsted Seminar C OTHER ITEMS Therapeutic Massage Ordinance Agenda - April 18 Community Improvement Fund Procedures Upcoming Agenda Goals and Objectives Schedule on Saturday April 15 - May 15 Ward Meetings Late May or Sept. Travel Policy July - State Auditor Subcommittee PLYMOUTH BOULEVARD, PLYMOUTH, W DATE: March 24, 1994 TO: Kathy Lueckert, Acting City Manager FROM: Dale Hahn, Finance Director SUBJECT: Request for Tax Increment expenditure plans Council member Granath requested information on the proposed Tax Increment plans for all of the City's Districts. Attached are the plans originally adopted with each of the Districts. Some of these have had modifications, because the costs for construction changed when the final plans were approved. We are hoping to have an informational session with Springsted representatives to further explain Tax Increment financing. G. Bond Issue Determination TAX INCREMENT FINANCING DISTRICT NO. 1 (PHASE I) DEVELOPMENT DISTRICT NO. 1 z ESTIMATED PROJECT COSTS FOR I-494 INTERCHANGE WITH COUNTY ROAD 15, COUNTY ROAD 61 PROJECT ACQUISITION, RIGHT OF WAY PUBLIC IMPROVEMENTS SUBTOTAL LESS: GRANT HENNEPIN COUNTY SPECIAL ASSESSMENTS PROFESSIONAL SERVICES DESIGN AND INSPECTION LEGAL AND FISCAL CONTINGENCY OF CONSTRUCTION ADMINISTRATION OF TOTAL TOTAL REVENUE FROM INVESTMENT INCOME NET INTEREST ON BONDS PRIOR TO RECEIPT OF TAX INCREMENT TO FULLY FUND PRINCIPAL AND INTEREST DISCOUNT 200,000 176,000 TOTAL AMOUNT OF BONDS TO BE SOLD REVENUE FROM PROPERTY SALES BONDS PAYABLE FROM TAX INCREMENT H. Estimate of Costs 625,090 4,200,000 4,825,000 376,000) 630,000 70,000 8,991 315,000 5,472,991 361,439) 5,111,552 1,785,000 103,448 7,000,000 0 7,000,000 The total cost of improvements (see Development Program Implementation page 8) is presently estimated to be $11,352,450 to be financed with one or more bond issues. The initial issue of $7,000,000 for phase I is described in section G. The completion of the entire project (Phase II) is dependent on future tax increment revenues and other financial resources. 13 EXHIBIT A Estimated costs of Improvements -- Tag Increment Financing District Nos. 1-2, 1-2A, 1-3, 1-4, and 1-5 Year Project Description Project Cost Total 1988-90 Interchange with County Road 6 and I-494 Acquisition of property 1,800,000 Construction cost, engineer & contingency 5,700,000 Net project cost 7,500,000 Less: Available TIF revenues 1987 360,030 Available TIF revenues 1988 802,225 Amount to finance 6,337,745 Plus: Discount allowance, finance 1,900,000 related fees and less interest Total earnings 162,255 Bond Issue 6,500,000 Less: 1988 $1,025,000 G.O. Tag Increment Amount to Finance Bond Issue Proceeds 1,014,600 G.O. TAX INCREMENT TAX-EXEMPT BONDS $5.485.400 1990 Improvement of County Road 61 from Xenium Lane to County Road 9 Construction costs 600,000 Signal lights 150,000 Right of way acquisition 1,900,000 Total 2,650,000 Less: County funds 400,000 Amount to Finance 2,250,000 Plus: . Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 300,000 G.O. TAX INCREMENT TAR -EXERT BONDS 2.550.000 Estimated costs of Improvements — Tag Increment Financing District Nos. 1-2, 1-2A, 1-3, 1-4, and 1-5 (continued) Year Project Description Project Cost Total 1989/90 Upgrading County Road 6 from County Road 101 easterly to Fernbrook Lane including right of way) $3,800,000 Less: County Funds -1,800,000 Amount to Finance $2,000,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 275,000 G.O. TAX INCREMENT TAR -EXEMPT BONDS $2.275.000 1991 Fernbrook Lane from Gleason Lake Road to County Rd. 6 $1,100,000 Less: Special assessments 400,000 Amount to Finance 700,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 100,000 G.O. TAX INCREMENT TAR -EXEMPT BONDS 800.000 In addition to the above identified projects, the City reserves the right to use tax increment revenues if they become available for any project that is a part of the Development Program for Development District No. 7. Following is a list of additional projects that currently are identified within the Development District Program. Estimgted Costs of Improvements — TIF Districts No. 2 and 2-1 Year Project Description Project Cost Total 1989 County Road 61 from County Road 6 to HighwAy 55 Land Acquisition (right-of-way) $ 235,000 Engineering and Inspection 330,000 Construction 2,085,000 Administrative 145,000 Contingency 205,000 Total Project Costs $3,000,000 Plus: Discount allowance, finance related expenses, capitalized interest 900.000 G.O. TAX INCREMENT TAX-EXEMPT BONDS $3.900.000 1990 West Medicine Lake Road relocation from 13th Avenue to 23rd Avenue and trail construction from T.H. 55 north to 26th Avenue $2,000,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 275.000 G.O. TAX INCREMENT TAX-EXEMPT BONDS $2.275.000 1993 Extension of Xeniun_Lane from 38th Ave. to amity Road 61 including right-of-way acquisition) and ext. of Vinewood Lane from.Cottofiwood Plaza south to Xenium Lane 1,125,000 Less: Special Assessments - 100.000 Amount to Finance $1,025,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 150,000 G.O. TAX INCREMENT TAX-EXEMPT BONDS $1.175.000 Estimated Costs of Improvements -- TIF Districts No. 2 and 2-1 (continued) Year Project Description Project Cost Total 1994 Extension of 18th Avenue to County Road 6 at T.H. 55 and extension of Industrial Park Boulevard from County Road 6 to Trunk Highway 55 900,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 125,000 G.O. TAX INCREMENT TAR -EXEMPT BONDS 11.025.000 Cost of Improvements -- TIF Districts 3-1 Year Project Description Project Cost Total Public Improvements 1986 Improvements Segment A (10th Ave. - Bassett Creek to South Shore) $921,813 1987 Improvements Segment C (Highway 55 Frontage Road from Quaker Lane to 8th Avenue) 279,813 1986 Improvements Segment E (Improvements 13th Avenue and C.S.A.H. 18) 590,106 Total public improvements $1,791,732 Administration/Organization 15,000 Amount to Finance $1,806,732 Plus: Discount allowance, finance related fees, capitalized interest 386,268 G.O. TAR INCREMENT TAR -EXEMPT BONDS $2.175.000 Land Writedown 1986 Net Land Acquisition (Devac/Freeman) $674,000 Administration/Organization 15,000 Amount to Finance $689,000 Plus: Discount allowance, finance related fees, capitalized interest 136,000 G.O. TAX INCREMENT TAX-EXEMPT BONDS 025,000 Two bond issues were sold totaling $3,000,000. Estimated Cost of Improvements -- TIF Districts 3-2 and 3-3 Year 1989 Project Description Project Cost Total Improvements to the Highway 55-& Revere Lane Intersection TID 3-3 $230,000 Frontage Road — Trunk Highway 169 Frontage Road from 8th Avenue to 13th Avenue TID 3-3 $505,000 TID 3-2 0 Total 505,000 Highway 55 & South Shore Drive Intersection TID 3-3 $210,000 TID 3-2 205,000 Total - 415,000 Highway 55 Frontage Road from South Shore Drive to Valley Forge Lane Ryan — TID 3-3 $100,000 Prime -- TID 3-2 100,000 Total 200,000 Right of Wav Accuition TID 3-3 $750,000 TID 3-2 750,000 Total 1,500,000 Amount to Finance $2,850,000 Plus: Administration/organization of TID, discount allowance, finance related fees, capitalized interest 550,000 G.O. TAR INCREMENT TAR -EXEMPT BOND ISSUE $3,400,000 1988 Land Writedown - TID No. 3-3 Land Acquisition Voline Property $565,000 Borden/Carlson Property 527,000 Total Land Acquisition 1,092,000 Less: Ryan Share of Voline Property -282,500 Net Land Acquisition $ 809,500 Plus: Administration/organization of TID, discount allowance, finance related fees, capitalized interest 240,500 G.O. TAXABLE TAR -EXEMPT BOND ISSUE $1.050.000 I Estimated Cost of Improvements -- TIF Districts 4-1, 4-2 and 4-3 Year Project Description Project Cost Total 1989 Schmidt Lake Road Construction from Zachary Lane to Saratoga Lane. The City of Plymouth will be responsible for the construction of the improvement. Total estimated project cost including professional services, construction, right of way acquisition, contingency $1,500,000 Less: Special Assessments - 300,000 Amount to Finance 1,200,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 175,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS $1.375,000 1991 County Road 10 Upgrading from Trunk Highway 169 to I-494. Hennepin County will be responsible for the construction of the improvements. Estimated City share for all project costs including professional services, construction, right of way acquisition, contingency $ 500,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 75,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS $ 575.000 1991 Other Necessary Improvements. The City of Plymouth will need to upgrade other elements of the overall roadway system included but not limited to Zachary Lane from 34th Avenue to County Road 10. Total estimated project cost including professional services, construction, right of way acquisition, contingency $2,370,000 Less: Special Assessments - 300,000 Amount to Finance 2,070,000 Plus:' Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 305,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS J2,375,000 I Estimated Cost of Improvements -- TIF Districts 4-1, 4-2 and 4-3 (continued) Year Project Description Project Cost Total 1995 County Road 61 from County Road 9 to 54th Avenue R.R. crossing 3,500,000 Less: Special Assessments - 500,000 Amount to Finance 3,000,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 450,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS $3.450.000 Estimated Cost of Improvements -- TIF Districts 5-1 Year Project Description Project Cost Total 1989 1990 1992 County Road 61 from County Road 47 to 54th Avenue 1,000,000 Less: Special Assessments - 400,000 Amount to Finance $600,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 100,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS 1700,000 Upgrading of County Road 9 west of I-494 for approximately one mile $1,300,000 Fernbrook Lane from Harbor Lane to 34th Avenue (street widening & traffic controls) 400,000 Fernbrook Lane from T.H. 55 to 27th Ave. street widening & traffic signals 200,000 Amount to Finance $1,900,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 275,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS $2.175.000 Schmidt Lake Road from West Medicine Lake Drive to Fernbrook Lane $900,000 Less: Special Assessments - 300,000 Amount to Finance $600,000 Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings 100,000 G.O. TAR INCREMENT TAR -EXEMPT BONDS 4700,000 Estimated Cost of Improvements -- TIF Districts 6-1 Year Project Description 1989 Highway 55 and West Medicine Lake Drive Intersection Improvements including right-of-way acquisition 1990 1990 1992 1994 1994 Signal and intersection improvements at Betty Crocker Drive, Nathan Lane & Ford Road Extension of County Rd. 73 from Old County Road 15 to Highway 55 Amount to Finance Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings G.O. TAX INCREMENT TAX-EXEMPT BONDS Extension of 6th Avenue from Pineview Lane to County Road 73 Less: Special assessments Amount to Finance Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings G.O. TAX INCREMENT TAX-EXEMPT BONDS Improvement of County Rd. 73 from south City limits north to Old County Rd. 15 Extension of West Medicine Lake Drive from Highway 55 to Sixth Avenue Amount to Finance Plus: Discount allowance, project administration, finance related fees, capitalized interest and less interest earnings G.O. TAX INCREMENT TAR -EXEMPT BONDS Project Cost Total 300,000 150,000 1,000,000 1,450,000 200,000 1.650.000 2,500,000 500,000 2,000,000 300,000 2.300.000 250,000 1,000,000 1,250,000 175,000 1.425.000 Estimated Costs of Projects - TIF District 7-1 1990 County Road 61 (est.) $2,630,000 Bridge (Soo Line Railroad) 700,000 Right of Way (9 acres @ $30,000/acre,) 3/4 mile, 100' wide) 270,000 Contingency 400,000 Signals (C.S.H. 9 & Vinewood Lane) 150.000 Subtotal 4,150,000 Discount allowance 74,625 Finance related expenses 36,000 Capitalized interest 870.000 Subtotal 5,130,625 Less: Interest earnings - 155.625 G.O. Tax -Exempt Tax Increment Bonds 34.975.000 1990 Soil Corrections/Site Improvements/Developer Assistance $1,000,000 Discount allowance 25,000 Finance related expenses 27,000 Capitalized interest 355.000 Subtotal Less: Interest earnings G.O. Taxable Tax Increment Bonds 1998 I-494 Schmidt Lake Road Interchange - Acquisition of property Construction costs, engineering & contingency Discount allowance Finance related expenses Subtotal Less: Interest earnings G.O. Tax -Exempt Tax Increment Bonds 1,407,000 32.000 111 600,000 7,500,000 90,000 60.000 8,250,000 250.000 MTE: The City reserves the right to modify various project estimates as further project costs are defined. The City reserves the right to enter into a "pay as you go" contract with the developer for these related costs. The final form of financing will be determined after further review by the City. E CITY OF ALESCOF MILES PLYMOUTH- s si «s €Y•cy.g a V: 1 wi. =; r:?«.."s' oa$ ee:0aW1s2..>::> ..o. 1=iaW. g 9 881 g5888QQ888Q88;IInum 8 8 $III HH,QQgQQQQQQUQ8 !"!§111 mQ111162 STREET MAP. n..n R -o JULY 1993993 R o -A 1 mprevc-%e..t Pro j eats t h e IWae a DATE: March 25, 1994 TO: Mayor and City Council FROM: Kathy Lueckert, Acting City Manager SUBJECT: Carlson Companies Bonds Attached is a transcript of Assistant City Attorney Dan Nelson's message on the Carlson Companies bonds. Because of the importance and complexity of the subject, I felt that a transcript of the voice mail message would be helpful. It is very likely that Mr. Nelson will be at the meeting Monday evening to discuss this with you, given the April 1. deadline for any action on the bonds. We have made certain that this subject is properly noticed. Please feel free to call Mr. Nelson or me should you have questions. My home number is 476-9711. CITY OF PLYMOUTH 3400 PLYMOUTH BOULEVARD, PLYMOUTH, MN 55447 DATE: March 25, 1994 TO: Kathy Lueckert, Assistant City Manager FROM: Laurie Rauenhorst, City Clerk SUBJECT: Transcribed Voice Mail Message from Attorney Dan Nelson to Assistant City Manager Kathy Lueckert - Carlson Center Project CONFIDENTIAL Following is the transcribed voice mail message from Attorney Dan Nelson that you requested relating to the Carlson Center Project. Due to the references of potential litigation, I believe it is CONFIDENTIAL under Attorney -Client Privilege provisions of the statutes. Kathy, please convey this message to Dwight Johnson and to the members of the City Council as you see necessary in connection with the Carlson Center project. I had a telephone conference call earlier today with representatives of Carlson Companies, Miller and Schroeder, and the bond trustee with respect to the remarketing of the bonds in the 1992 Bond Indenture. The 1992 documents which were agreed upon by the City provide for a remarketing of the 1992 bonds with the interest rates and maturities as the remarketing agent, Miller and Schroeder, deems appropriate and necessary based on the security pledged by the company to the bonds after the April 1, 1994, remarketing date. Miller and Schroeder has presented a maturity schedule and an interest rate to the trustee, but the bond documents require in Section 3.2e that the remarketing agent, with the consent of the City Manager, shall determine the schedule of prepayment dates and prepayment prices for the bonds after the mandatory tender date. That consent of the City Manager is an element of the 1992 Indenture which the City signed off on and which in my opinion, can be approved as a simple administrative act by the City Manager and does not need any formal City Council approval. Voice Mail Message - CONFIDENTIAL Page 2 The fact that the City Council has rejected a refunding bond issue for this project at the last meeting on Monday, March 21, is entirely appropriate and in the discretion of the City Councilmembers because that would be a legislative act which they can do, which they can make their decision on in their best judgment of what's in the best interest of the City. The requirement under the 1992 Indenture, however, that a City consent be given to the prepayment provisions of the 1992 bonds after the April 1, 1994, remarketing date, is a requirement from the approval given by the prior City Council. I understand that the political sensitivity of this project requires that the City Council be informed of what's going on and that the City is reluctant to give any affirmative approvals to the Carlson project in light of Carlson's failure to perform, to complete the improvements that they originally intended. However, I believe that the City can avoid making any affirmative action in favor of Carlson by simply waiving the consent right given in the bond indenture and allowing the company, the remarketing agent, and the trustee to carry out the 1992 bonds as they choose, recognizing that the City by waiving the required approval makes no statement affirmatively approving any actions by Carlson. If the City were to choose to do nothing in connection with the request of Carlson to grant either a waiver or a consent to the terms of the refunding bonds, the City faces a potentially significant liability for failing to perform a reasonable administrative procedure on the basis of an arbitrary and capricious decision-making by the City, or a failure by the City to deal with good faith and fair dealing in connection with the 1992 obligations already approved and undertaken by the City. If Carlson were to make this request to the City and the City simply says, 'No, we don't want to have anything to do with this," and refuses to give any consents, then the bond financing could not be remarketed on April 1 and Carlson would lose the benefit of tax exempt financing for the next 18 years on $17.2 million some dollars. With a difference of perhaps 1 1/2 to 2 percent between the equivalent tax exempt rates and taxable market financing that Carlson would face, the damages that Carlson could claim against the City would be significant, particularly where the City has no increased exposure or liability in its rejection of Carlson's request. While Carlson has a significant down -side if the request is not granted or waived, Carlson would probably claim that the City is extracting a pound of flesh from Carlson on this issue because of the recent controversies over real estate planning and development issues, which are certainly valid issues that the City should be concerned about but are unrelated to the obligations that the City undertook in 1992 when these bonds were issued. For these reasons, I think that the City would be best served by agreeing to waive its consent and approval rights under the 1992 Bond Indenture, thereby not giving any Voice Mail Message - CONFIDENTIAL Page 3 affirmative approval to the Carlson project, but still allowing the project to be remarketed to avoid any potential liability to the City. After you have had a chance to review these comments, I'd be happy to talk to you at your earliest convenience. My direct line is 349-5649. If you need to reach me at home this weekend, I'm at 449-0730. " --- End of Message. DATE: March 25, 1994 TO: Mayor and City Council FROM: Kathy Lueckert, Acting City Manager SUBJECT: Article on State Auditor's Report in City Business Attached is an article from this morning's City Business on the State Auditor's report. Thought you might want to see it. 6 MARCH 25, 1994 CityBusiness Report comes down on the perks in Plymouth By JENNIFER WATERS Imagine this: You're a supervisor in a large public company. The employee base:is predominantly union -run, dictating pay scales, hours, overtime and benefits packages. You're not a part of the union, but you must adhere to some pretty strict employment policies. You've got a board of directors that meets frequently to set policy for the company. While they wield a lot of power, they don't necessarily know what's going on day to day. Your boss is generous with the perks. You and your co- workers talk openly about how bountiful the compensation packages area But still you are uneasy, because you have a vague suspicion that the perks are not in line with employee policy; Let's shift gears a bit. Imagine that the -company is actu- ally a unit of government, the board of directors is a city council and the boss is the city manager. Now you have what happened at the city of Plymouth, particularly from 1989 to 1992. At least 25. people, mostly supervisors, who worked for the city of Plymouth received extra vacation time, a clothing budget, free eye care, orthodontia, health club member- ships, even generous mileage allowances. All this and a sal- ary in the $50,000 -and -above range. Sometimes one-time bonuses were even thrown in. In other words, city employees were receiving perks and benefits that the city council did not approve. The financial perks and reimbursements totaled more than $200,000 over a four-year period. The perks were finally severed in late 1992. A state auditor's report on the perks, released this week, found that the questionable employee compensation pack- ages were in fact unlawful. But the report did riot find grounds for criminal action. Rather, it administered a slap on the wrist: It urged the city of Plymouth to enforce poli- cies of authority for granting and changing employee bene - Elected officials and city administrators and other gov- ernment officials do not have the same wide discretion in providing benefits and other in-kind [perks] as the private sector," said Paul Almirall in an interview. Almirall is deputy state auditor who led the investigation. The abuses were discovered last year by new City Man- ager Dwight Johnson, who requested the state investigation after he found what he thought were discrepancies with the law. The biggest benefactor was the previous city manager, Jim Willis. Not only did he receive a salary in excess of 86,000, but he allegedly took in the same kinds of perks and benefits that he was doling out. Plus, he got more: a Chrysler New Yorker, one valued as much as $20,198, and paid trips from Hawaii to Minneapolis and back again. The auditor's report called these extra extras questionable." The investigation found that Willis had a "company car" written into his employment contract, but there were no re- strictions placed on it. So he bought all used cars, he says an '87 New Yorker, valued at $15,968; an '89 New York- er, valuedat $20,000; and a '91 Chrysler Imperial valued at 16,312..(He was able to turn them in every 45,000 miles.) The city paid for all gas and maintenance on the car, ac- cording to the auditor's report. Apparently that. inclujed trips to a college attended by a family member'th t port I aid. And there are the Hawaii trips. Willis — who was re- quired to attend two council meetings a month — planned a trip to his. Hawaii -based condo during the week of a city council meeting in January 1991. Because he felt "this was a round-trip ticket from Hawaii to Minneapolis at $1,534.04. Before he left Honolulu remember, this was his vaca- tion spot — he upgraded the ticket to first class, adding 125 on to the bill..Why? Because he needed more rest, he told the auditors. Plus, he had a $40 parking charge at the airport to boot. In retrospect, Willis said he probably didn't need to be at that meeting, but didn't know, that at the time. He's sure, however, that he will not have to reimburse the city for the trip. Nor, he said, should he be required to reimburse the city for a $775 ticket, again from Hawaii, in August 1989. The red flag on this ticket was that he submitted it three years after the fact. No explanations were offered, according to the report. At one point in time, all the council members were aware" of all the perks, he said, conceding that that might have been only when he was hired in 1971. "We made no attempt to hide or conceal those benefits. I don't apologize for that. I was just trying to run the best organization I could." So what will the city council do now? If this incident took place at a business, the culprit would be fired without sever- ance, the payments reimbursed and the rest of the staff se- verely reprimanded. But in, Plymouth, things are different. Yes, Willis did get fired, but he was given a hefty severance package. (He's now city manager in Inver Grove Heights, although sources said he was trying to get back his job in Plymouth.) And yes, he was required to,reimburse the city $25,800 for a life in- surance policy on himself and his family. But solar he has not been called on to pay another cent. And_ the city council has taken the governmental ap- proach to scandals: It has formed a committee. At its March 20 meeting, the council said it would further study the audi- tor's report before taking any further action. Biz Et Al. appears the fourth week of each month in City- HAA -26-1994 21:06 BOR. REHHER'=; OFFICE E.12 48 '+^4 P.01 N Facsimile Cover Sheet To: MLC OPERATING COMMITTEE CITY MANAGERS From: Bob Renner, Jr. Company: Messerli & Kramer PA Phone: 612-228-9757 Fax: 228-9787 Home 483-9347 Date: 03/26/94 Pages including this cover page: 9 This amendment will be offered this coming week in the Senate Metropolitan and Local Government Commiittee. Please contact your legislator and ask them to oppose this initiative. 1: G r, BOB REI It 1ER' '_. i=iFF I i=E MUNICIPAL LECISLARVE COMMISSION MEMO TO: MLC OPERATING COMMITTEE FROM: BOB R.ENNER, JR. 612 4871 9347 R.=r 1800 Fifth Street Towers 150 South Fifth Street Minneapolis, MN 55402-4218 Telephone: (612) 672-3600 Facsimile: (612) 672-3777 RE: SENATOR MONDALE FISCAL DISPARITIES PROPOSAL TO CAPTURE 40% OF THE NEW VALUE OF HOMES IN EXCESS OF $200,000 DATE: MARCH 26, 1994 Please find attached a copy of a delete everything amendment that Senator Mondale will offer in the Senate Metropolitan and Local Government Committee this week. It has not been scheduled but must be adopted by the Committee before March 31st in order to meet the committee deadlines. The House Companion bill, authored by Representative Orfield, met the House deadline last week. This bill differs from Representative Orfield's bill as amended by capturing 40% of new home values over $200,000 and using the revenues generated from this value to assist cities in meeting their comprehensive choice housing goals. The Orfield bill as amended captures 100% of all value over $150,000 and places it in the metropolitan fiscal disparities pool. Only one-half of the revenues generated will he used for housing. The other one-half will be deposited in the general fund and be. used statewide for contaminated site cleanups. Page 5, lines 16 - 25.) It. must be pointed out that only cities that are losers udder fiscal disparities will contribute their excess tax capacity. Cities whose distributions are greater than these contributions will not have to shard tax base. (Page 3, lines 33 - 36 and page 4, lines I - 2.) This will create odd results such as exempting the value in cities such as North Oaks while homes in Brooklyn Center will share base - This bill will also cause property tax rates to increase on all Montes in Hennepin County due to the large base that the County will have to share with the entire Metropolitan area. DATE: March 25, 1994 TO: Mayor and City Council FROM: Kathy Lueckert, Acting City Manager SUBJECT: Carlson Companies Bonds Attached is a transcript of Assistant City Attorney Dan Nelson's message on the Carlson Companies bonds. Because of the importance and complexity of the subject, I felt that a transcript of the voice mail message would be helpful. It is very likely that Mr. Nelson will be at the meeting Monday evening to discuss this with you, given the April 1- deadline for any action on the bonds. We have made certain that this subject is properly noticed. Please feel free to call Mr. Nelson or me should you have questions. My home number is 476-9711. 1 1, CITY OF PLYMOUTH 3400 PLYMOUTH BOULEVARD, PLYMOUTH, MN 55447 DATE: March 25, 1994 TO: Kathy Lueckert, Assistant City Manager FROM: Laurie Rauenhorst, City Clerk SUBJECT: Transcribed Voice Mail Message from Attorney Dan Nelson to Assistant City Manager Kathy Lueckert - Carlson Center Project CONFIDENTIAL Following is the transcribed voice mail message from Attorney Dan Nelson that you requested relating to the Carlson Center Project. Due to the references of potential litigation, I believe it is CONFIDENTIAL under Attorney -Client Privilege provisions of the statutes. Kathy, please convey this message to Dwight Johnson and to the members of the City Council as you see necessary in connection with the Carlson Center project. I had a telephone conference call earlier today with representatives of Carlson Companies, Miller and Schroeder, and the bond trustee with respect to the remarketing of the bonds in the 1992 Bond Indenture. The 1992 documents which were agreed upon by the City provide for a remarketing of the 1992 bonds with the interest rates and maturities as the remarketing agent, Miller and Schroeder, deems appropriate and necessary based on the security pledged by the company to the bonds after the April 1, 1994, remarketing date. Miller and Schroeder has presented a maturity schedule and an interest rate to the trustee, but the bond documents require in Section 3.2e that the remarketing agent, with the consent of the City Manager, shall determine the schedule of prepayment dates and prepayment prices for the bonds after the mandatory tender date. That consent of the City Manager is an element of the 1992 Indenture which the City signed off on and which in my opinion, can be approved as a simple administrative act by the City Manager and does not need any formal City Council approval.