10/18/82 City Council Minutes{ THE REGULAR MEETING OF THE KALISPELL,CITY COUNCIL ,WAS HELD AT 7:30 PA MONDAY, `
-OCTOBE�R'18 198, IN THE CQUNCIL a4AMB�RS AT CITY.HALL., MAYOR MCDOWELL PRESIDED'.
COUNCILMAN_SAVERUD WAS ABSENT. ALL OTHER COUNCILMEN -WERE PRESENT. r
CITY OFE1CIAL.:REPQRTS
City...Treasurer poi. -August '1982
City..' dodge. for September. 1982
Polite'ChieE for September 1982
_ Eire Dpartmerit;..Thsicci Quarter 1982
Councilman'NystuI m9Ve4.to accept the City Officia.•1 Reports,;Seconded by Councilman
.Zauner. Carried.
OPEN BIDS Police. Cars.
TANNEHILL AUTO CENTER.. Cashier's Check
1.983 Ddd.ge Diplomat 4 dr. Delivery date: 60 days
Bid price.'o.f two (2) cars with no trade-in'..$19,138.,00
Bid price of two (2) cars if trade -in -.two .(2) 17,138.00
Bid price of two (2) cars. if trade-in one Cl).
1980 Plymouth Volare., 18.,138.00
1976 Ford Torino' 18,638.00
ROY STANLEY CHEVROLET Cashier's Check
1983 Chevrolet Malibu 4 Door Delivery date: 45-60 days.
Bid price for two (2) cars, with. no trade, -.in $18,631.52
Bid price for two (2) cars with one trade-in 183131.52
Baal price for two (2) cars with two. (2) trade-ins 17,631.52
Trade-in prices figured on'a 1'980 Plymouth Volare and a
1976'Ford Torino,
Councilman Grain.,ger,moved to refer -the bids to the Safety Committee with power to
act,. Seconded by. Councilman Nys.tul Motion carried, .
OPEN BIDS.- Sidowalk and Curb Construction 1982
BIG MONTANA CONCRETE CONSTRUCTION -Greg Iverson Cashier's Check
Proposal as Follows:
PROPOSAL
FOR
CURBS AND SIDEWALKS
All items listed below shall inciude all labor, equipment and
materials necessary to construct them in.accordance with the
Specifications and sketches attached.
BID EST. UNIT TOTAL.
ITEM DESCPIPTION UNIT QUAN. PRICE AMOUNT
1- strai,nt Curb (R--4) I,-F, 40
2. Curb . and' 'GUtter (R-2) L.F. 190 $ . M 3L $ _ ,' s=
3,. 41 Sidewalk (R"G) L.P. 23 $_z_a �
4. Extra Sidewalk',Area S.F. 360 $ 3,IF2 $ �
5- 6" Thick Sidewalk- S.F. 60 $ • �rc� $o(..`
6. 10' Driveway (R-1.;AIt'.2) Ea- 1 $_Ta 6.
7. Extra Driveway -Area S.F. 10 $
Total Amount -- --
This proposal shall be in'effect until July 1, 1983, unless canceled
• by mVtual consent, in writing, signed -by both parties.
Council n Grainger moved the bid.be•referred to -the Street & Alley Committee with power
to act. Seconded by Councilman Zauner. Motion carried.
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.. APDRESSING THE CO NCTL
Mdy6r `McDawell• `made•. three calls- for .anyone 'Wishing, -to address' the Council. Igo one
COMMITTEE REPORTS
SEWER. 4 WATEFP'
'Tom -Flynn presented tho• following report on the sewer rate study:
T.'R. FLYNN'and ASSOCIATES
Municipal utility Rate Proredures
Box 33 Kalispell, Mt. 59901 257-1836
October 18, 1982
Mayor McDowell -
City Council of Kalispell
Gentlemen:
It is customary in presenting information related to municipal utility
rate matters to gather all available data into a completed form and
present it.as a cut and dried situation.
While we prefer that approach you are well aware that this is not
possible at this time. We have heard complaints concerning the lack
of communications.r;7if.ti:the-_couacil:bebn4.uninformed concerning various
elements of the water and sewer systems. Because of that we have
been involved in a concerted effort to inform the council and the
various committees concerned about problems that exist in budgeting,
and finance.
It should be pointed out this discussion deals only with the SANITARY
SEWER revenues and expenditures. We are convinced that the STORM
SEWER must be considered as a separate entity, even though your records
merge the two funds as one. The Montana Consumer Counsel is in full
agreement that in no way should Storm Sewer finances be considered in
the some light as Sanitary Sewer, which is subject to PSC jurisdiction.
In our November 1981 presentation they were considered as one, but
because of a similar situation In another Montana city the Consumer
Counsel has taken the attitude that they are separate and should be
considered as such.
Getting back to the communication problem. In November 1981 we prepared
and presented a detailed discussion of Sewer Rates which resulted in the
present rate structure. Included in that presentation on pages S-11 & S-12
were schedules indicating how you could•finance the Sanitary,Sewer Budgets
over a 3 year period. Included was the comment that you MUST reduce 'the
total budget and a suggestion that the item of Administration be cut by
5Q'f.. The reduction was not reader which accounts for 60% of the deficit
in the Sewer Fund as of June 30, 1982. In ,Tune of 1982 prior to your
Budget sessions I prepared a 4 page discussion of Sewer funding and
reviewed it with the Sewer & Wptex Committee and some members of the
Finance-corn»ittee. At a -July or early -August budget session I pointed
out in your review of the Utility Budgets that they could not carry
the expenditures that you were proposing.
I
On August, 16th the council met to review the budget and I was
invited to be present, at which time.I.presented 4 pages of
data indicating that the Sanitary Sewer Operating fund had
an overdraft of $40,000 as of June 30, 1982.
On September 15, 1982 I prepared a 5 page discussion of the
situation as it concerns Sewer financing.
On October 12th we met with the Sewer and Finance Committees,
at which time it was determined to make recommendatons to the
Council amending the Sewer Budgets and requesting rate hearings,
The 5 pages of data accompanying this letter were prepared after
that October 12th Meeting. It must be emphasized here that we do
not have Financial Statements for the year ended June 30, 1982.
This information was entirely compiled from known revenue figures
based on present $1.00 rate and from Proposed Budget figures.
as amended in that October discussion.
It has been pointed out in all of these discussions that while we
have provided for a, large increase in Sewer Revenues, there are
very definite stringsattached thereto. Those funds that are being
collected that were designated to cover certain EPA mandated items
are NOT available for general operating expense of the utility.
In a telephone conversation today., October 18th, with ,Tames Payne
Montana Consumer Counsel we reviewed our thinking as presented here.
It .was confirmed that we can.proceed with a hearing based on 12%
plus an additional factor to retire. debt, and if necessary we can
at that hearing set a rate that would become effective July 1, 1983
if added funds are necessary to cover EPA Ma-adated Debt Service.
It is -essential that a heari'ng,be scheduled, at which time we will
have confirmed the data offered here by reconciliation with financial.
statements.
Sincerely,
T.IR.FLYNN & ASSOCLWES
TF : hf BY
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- T.R. FLYNN �. ASSOC.
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10/18/82
On October 12.we met with the Sewer. & Water Committee and the
Finance Committee to discuss the matters presented to you with
9ux letter of September 15, 1932. 'There was a consensus that
the problem presented was real and had to be dealt with. The
budget reductions suggested were accepted by these committees
for recommendation to the full council. It was pointed out that
the "Available Funds" to cover that reduced budget outlay include
an increase in Sewer Fees of 12/; effective January 1, 1983.
We also discussed our recent meeting with Kreg Jones representative
of 1). A. Davidson Co. bond department. Mr. Jones had stated that
unless the lawsuit problem was reconciled there would be no bond
sale..
The council members present at this meeting agreed that,regardless
of the bond sale, it was essential to proceed with a Council -conducted
hearing covering the proposed 12% Sewer Rate Increase.
On October 14th Mr. Kreg Jones contacted us to advise that after
conferring with City Attorney Neier and former City Attorney Donohue,
D. A. Davidson and their bonding attorney were of the opinion that
a bond sale.cbuld.be completed.
In order to comply with regulations on Council -Hearings it is necessary
that printed notices and. those notices mailed to users come within a
certain time frame. It should be recognized that mailing separate _
notices to each user is bath time consuming and costly. If the Council
agrees on a hearing date, we have tentatively aarranged within the billing
department a means of mailing those notices with the billing ,for October
and November by a slight adjustment in mailing dates.
As the EPA grant approval seems to be in limbo we are not in a position
to determine bid letting dates or bond sale Lettings. However because of
the time factor and the expense of another hearing with all of its noti,-
fication problems it is suggested that a pre=deteYmined cost per M Gallons
of Sewage be stated at the cost of retiring debt that will be created
when bonds are sold. This would have to be stated on a basis of the
cost to retire debt based on various levels of interest cost. The hearing
could be, conducted with the 12% increase becoming effective January 1, 1983
with the additional to cover bond retirement costs becoming effective at
date of dale. of bonds. Hopefully confirmation of the grant may be 'had
shortly so that sale of bonds might be accomplished in the next few months
.making it possible to make one adjustment in Sewer states .'
Unaudited financial statements of the Sewer Funds are to be ready
this week and will be sent to D.A.Davidson for their information.
It is hoped that Audited Statements will be ready -for inclusion in
Bond Prospectus when we -reach that time. However the expenditure
.figures and revenue needs stated in our September I5th discussion
were taken from known sources, namely income based on $1.00 per M,
and expenditures budgeted and approved by the council..
We propose that the Council set a hearing date at which:timei"resent
Sewer Fees will be increased 127. to cover normal maintenance and
operating costs. And that further increase sufficient to cover
the cost of Debt Service be approved to'become effective at the
time the debt is created and at a rate contingent upon the amount
of the debt and the rate of interest applying.
. f
Using engineerls estimate of the city's share of the cost of
plant construction, and combining that with other EPA mandated
expenditures that have been shade and paid with registered warrants
or from borrowed funds we find that we can designate as EPA
Mandated !:approximately $900,000. D.A.Davidson have suggested that
we assume a rate of 11`4 for purposes of estimation thus a cost
of $136,678 Annually to cover Interest& Principal and 25% coverage
factor,
We have been talking an issue of $1,000,000, which would provide
$100,000. additional funds and would cover the cost of the Sewer
Cleaning Machine that has been proposed. ,
k
If a $1,000,000 issue is sold the debt service on this extra $100,OOD
will have to come out of the 12% N&O increase mentioned above, or
about $15,000 annually.
Befor.e we canissue notices to users; etc. the cosn*nittees involved
must agree unnn the .si7P [nf the bend i Ss"iP considPrPd_
The Proposed Bond'Issue: '
-" The annual debt service on $1,000,040 pf.Debt, based on
117. Revenue Bonds issued for 20 years would be $121,495
Plus a required coverage in excess of that amount 30,375
Total'Required annually $151,870
• As EPA Mandated Items constitute only 907 of
this,amount it has been suggested that we raight
issue-only.$900,000 at an..annual cost of 136i678
Based on present volume of 447,000M Gallons the
cost computes to.
$1,000,000 "Issue ; .3398 per M
900,000 Issue .3058-'per M
A $1%,000,000 issue would provide.funds:to purchase the
sewer cleaner, the lessee amount world not
EPA.Mandated.Items to.be i.ncluded,in the.Bond Issue. -
City share of Plant Improvements $6471500
Land Acquisition 20,340
Design.of Plant, Engineering 44,190
Sewage Injection Vehicle & Interest. 121,970
- Chem Seal Work (Outstanding Warrants) w .49r750
883,750
Portion of Bond Fee 8,838
$ 8929588
All figures used are on a basis of -rounding off
to $9003,000 or to $1,000,000 as the case r.�y be.
Operating Projections In usage of'EPA Mandated Funds: _.
generated by the present Sewer Fee of $1.00. per M, plus an�
Increase of 127. effective January 1, 1983, as follows:
1982 f 83 1983/84
EPA Mandated Expense 433,900 l6v500
EPA Mandated Reserve 31,000 31,000
EPA Mandated Debt Service 68,340 136 680
143,240 184,180
i
As previously indicated we are presently -collecting a total of
$153,483 annually designated as -EPA Mandated.,
The proposed January 1933 increase of 127. applied to the above
will add $18,417.to that rategaryfor a total of $1719,901,
If we use this as justification for a further increase in Sewer Fees
we find that we would require -an additional.3q per M to coverS1983/84
However in the period January 1 to June, 30, 1982 the portion of the
$1.00 per M fee that is considered as EPA Mandated provided a total of
approximately $63,500. Determined by averaging the annual increase
of $153,483, (Epa Mandated) over a 12 month period which amounts to
$12.,790, multiplying .by 5 months (as collections would have been made
February June at this rate.)
From the viewpoint of the Montana Consumer Counsel, one has to assume
they wou1•d expect $63,500 would have been used to reduce those EPA
Mandated Itens.
The -EPA Mandated Reserve of $31.0000 listed above is a Depreciation
Reserve on the existing plane and is required by EPA. This item' -will
increase considerably when an -additional grant is secured and additional
plant is constructed. That. increased- reserve allocation will appear
In the years -following construction.
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414
RESOLUTION #3445
Councilman Ruiz moved to adopt Resolution #3445, a resolution to set a date for a
public hearing on sewer fees. Seconded by Councilman Nystul. Roll call vote. All
voted aye.
FINANCE
Councilman Nystul reported that the Finance Committee has made a reduction of
$116,000.00 in the Sewer Budget.
On the Interlocal CAB Agreement, Councilman Nystul reported that instead of amending,
a Memo of Understanding should be issued,,which allows Mayors and City Managers to
attend meetings and to more clearly state how finances will work.
URBAN COALITION
Councilman Nystul moved that the City join the Urban Coalition and pay a fee of
$1,200.00. Seconded by Councilman Vidal,
Councilman Nystul stated that the money is not budgeted, but the Finance Committee
could try to make a budget adjustment on some other item,
Councilman Palmer stated that he believes it is a duplicate service already taken care
of by the League of Cities and Towns.
Councilman Zauner stated that -in light of labor negotiations and no funds for salary
increases, he would vote against the motion.
Councilman O'Boyle asked, "What if we recover $10,000,00?"
Councilman Ruiz stated that we have received word that our anticipated Revenue Sharing
funds will be $21,000.00 less than when we accepted the budget, In the Governor's last
report, it was stated that the League of Cities and Towns. -and the Counties Association
would be administering the block grant and so he believes these two bodies are recog-
nized as governing finances for cities and counties.
Councilman Vidal stated that any extra finances for cities will come from the next
begislatuxe and the more lobbying and the more interest the better, She fully supports
the work being done by the Coalition.
Question called. Councilmen Nystul, O:`Boyle and Vidal voted aye, Councilmen Ruiz,
Zauner,:Palmex�-:and Grainger voted nay, Motion defeated,
Councilman Nystul reported that residents of Ward I on Yellowstone Street, Glacier
Street and that portion of Hawthorne Avenue have petitioned for street lights. PPFL
has been notified and are preparing a contract. Director of Public Works Hafferman
reported that there is an area below Woodland Park that has requested street lights.
Mayor McDowell asked Mr. Hafferman to tell the residents to present a petition.
EMPLOYMENT
Councilman Zauner had no report,
ANNEXATION
ORDINANCE #1018
Councilman Palmer moved second reading of Ordinance #1018, an ordinance to extend the
city limits to include Hutton Addition, Seconded by Councilman.Nystul,
Councilman O'Boyle asked that the letter from the Highway Department to Mr, Verma be
recorded in the minutes:
DEPARTMENT OF HIGHWAYS
415
TEDSGHWINDEN. GOVERNOR
---- STATE OF MONTANA
KaUspe,U, Montana 59901
OCtobex 18, 1982
MIL. Nakut S . V etyma
Ptanning Di&ee toa
Hathead Reg.ionat DeveQopment 044.ice
723 5th Avenue Fazt
KaVApett., Montana 59901
Dews Nick:
RE: FVCC Annexation Sites
Th A i6 to advi4e that we met thi.6 date with Ftanc ins O'BoyZe and
Ed Myw and diAcu-&sed accezz to the pupolsed new eottege. Oua commenta
at ,this time cute o6 the geneAat natw&e becau.ae. no .peci6ic-Ln6o1rmati.on
-us yet ava i_?_abte.
We woutd k i ke to Zee the site ptCan developed az ing Gaandv.iew Da ve
a1s the pa.imwcy access to U.S. 93. The DepaAtment o6 Highways i6 in the pucezh
o6 devetopc.ng a .tmpaovement paoject that zhoued 9-keaf-y Znptove the za4ety
o6 tW .inteueetion. We wUt pxov,cde you and the college addc.iionat .i.n�oAmation
as the scope oj oux woak is de6ined.
It -might aZ6o be desi&a-W to have an addr"tionat accezz point {po& the
coZEege but we wovtd paeSen to not have it onto U.S. 93.
we.'afzo tacked about keeping the eottege .impkovenient6 back cuoay 4aom both
U.S. 93 cued Gtc_andv.iew DAive. This wiet a loto 4oa poss.ibte 4u ime fz i.g1way
.c.mpuvemen z and atzo geduee no.i.ae. and .impnove ahtheticz goa the cottege.
AdfLEtionat.n.cgfrt o6 way at this .inteUect_on may be nece�szaay to accomp.P.izh
our. sa�ety .cmp&ovemee-s. (tie dLscu zed the po�sz i.bLbitty og" the cotCege contkibatng
the neceA swty .4 ght o6 way on thei& coanen.
Thank you Jots the oppoatuni ty to commeka on tW mattm
VeAy tkuty youu,
&amaT.Weaver., P. F.
Supv.-D.i,v. Coast. Section
JT(1J: cafe
Ak cc: Ed Uyeu ANIOrJAI l3rnnrNI'VFYVarn[O•.£R
- Councilman -Ruiz -asked City Attorney Neier what would happen if the -college leases
out commercial space, such as food service, as far as taxes were concerned. Neier
replied that the restrictions on the land use would.prevent them from leasing space
to any commercial business. Any business connected with the college will be run by
the college.
41
Councilman Palmer reported that the Idaho Forest Industr.i2s.annexation is ,still pending
because of legal problems. Councilman O'Boyle stated that the Highway Department would
like a right--of-way on this property to eliminate a safety -hazard coming off Four Mile
Drive.
STREET & ALLEY
Councilman O'Boyle reported that S,I.D.#335 Bonds have been sold to First Interstate Bank.
Councilman O'Boyle reported that S.I.D. #335 construction bid has been awarded to American
Asphalt.
PARKS
Councilman Vidal reported a request from Northwest Telephone Systems for an easement
across Depot Park to provide adequate service to the old depot being renovated by the
Chamber of Commerce. City Attorney Neier has reviewed the easement,is changing it by
adding that the park be restored exactly as it was before the underground cable is
installed.
Councilman Vidal moved that Mayor McDowell be authorized to sign the easement as changed
by City Attorney Neier. Seconded by Councilman Nystul. Motion carried.
DRY BRIDGE PARK
Councilman Vidal -moved that Carver Engineering be authorized to call for bids on Phase II
and III of the Dry Bridge Park Project, Seconded by Councilman O'Boyle,
Councilman Vidal explained that Phase 1, the engineering study and drainage process is
done and they are now ready for Phase 11, to build a dike and Phase T11, the final grading.
The cost is projected at $20,000,00, excluding pipe.
Question called. Motion carried.
GOLF COURSE
Councilman Vidal reported a letter from Golf Association President, Ball Janes, requesting
the City to deed the Club House to the Association, Superintendent Drent is concerned
that it will violate our BOR Agreement, City Attorney Neier questioned whether public
property can be deeded to private parties without an election,
Councilman Ruiz stated that the Association did own property adjoining the golf course
and it was given to the City when they built the last 9 holes, The last 9 holes were
built with BOR Funds and Association Funds at no cost to the'City. The City now owns
a $2,000,000.00 Golf Course. The Club House is in major disrepair.
The Council agreed that City Attorney Neier should research the legal aspects and then
make a decision.
LAWRENCE PARK
Councilman Vidal reported that the grading is progressing well in Lawrence Park, The
City has 10 to 12 cords of cottonwood and elm wood for sale. Wood is located at the
shop. Buyers will pay the Treasurer, pick up a receipt, and then pick up the wood.
Superintendent Drent will let the office know when it is all sold.
SWIM POOL
Councilman Vidal asked for Council approval for Superintendent Drent to hire someone to
study and give a recommendation on repairing the swimming pool.
Jim Thompson, Architect, reported there is a Citizen's Committee working on the forma-
tion of a recreation district, possibly having the same boundaries of School District #5.
Question asked how you could administer the district, being partly outside the City. Mr.
Thompson stated that Libby did it and he will find out how this was accomplished,
Discussion on whether or not an architect would be an expert from Billings who gave us
the recent report and see what he advises.
Decision made to talk more with pool expert from Billings, who gave us the recent report
and see what he advises.
COMMUNITY DEVELOPMENT
Councilman O'Boyle presented the following letter from the Parking Commission;
October 18, 1982
TO: Street -and Alley Committee
FRC:I: Parking Cemmi55i4 or.
�A� 11I
417
.� � .N
At our October 5 meeting it was recommended that the
Parking Commission request your committee that .we be
granted permission to.have the number poles removed
from the Central lot_ Do%,ntoi,m merchants have agreed
to remove the poles as more landscaping is being
planned.
We request permission to do this as soon as possible.
Thank .you.
v c
Gor on Pirri.e
Chairman
Parking, Commission
GPIms
The Council agreed to this request.
SAFETY
Councilman Grainger moved that Dave Gullickson, who has completed twelve months
probation be confirmed as a.police officer. Seconded by Councilman Vidal. Motion
carried.
MISCBLT.ANEOUS
RESOLUTION #Z5446
Councilman Nystul moved to adopt Resolution #3446, a resolution to approve a transfer
among appropriations within a General Classification of Expenditures as adopted by the
City of Kalispell Budget for 1981-82 Fiscal Year. Seconded by Councilman Zauner. Roll
call vote. All voted aye.
Councilman Grainger moved to adjourn at 9:30 P. M. Seconded by Councilman Palmer -
Carried.
Approved as presented November 1, 1982.
ATTEST,
ti
Marjorie iermann, City Clerk