1. Call to Order. The regular work session of the Council of the City of Rogers was called to order by Mayor Bunting on Tuesday, July 23, 2013 at 5:30 p.m. at Rogers Community Center, 21201 Memorial Drive, Rogers, MN, 55374.
Council present: Jay Bunting, Don Hall, Rick Ihli, Darren Jakel, and Maureen Stanley.
Staff present: Mike Bauer, RAC Manager; Jeff Beahen, Police Chief; Brad Feist, Fire Chief; John Seifert, Public Works Supt.; Stacy Scharber, Assistant City Administrator; Steve Stahmer, City Administrator; Bret Weiss, City Engineer; and Lisa Wieland, Finance Director.
2. Public Safety Building Discussion
Tom Moorse from HTG was present.
Administrator Stahmer stated since the last City Council work session, there has been a meeting of the Public Safety Task Force. The Task Force studied a second option of obtaining a stand-alone police department site. Stahmer stated Moorse looked at the building and has put together some cost estimates to renovate it into a police department. The first option is the $5 million addition/renovation to the current community room.
Stahmer invited Moorse forward to review cost estimates on the second option. Moorse reported the estimate is $3.1 million for the site acquisition and remodel of a stand-alone existing site. Stahmer stated that it does not include the amount needed to create an Emergency Operations Center (EOC) at the current fire station.
Stahmer asked that Beahen speak to the functionality of an off-site building similar to the one Council walked through. Beahen stated it would bring the department closer to the main traveled roadways.
Ihli asked if we have looked at any other buildings in the City and are any others functional. Stahmer stated that we have done a walk-through of other buildings, but they are not as functional.
Moorse handed out draft floor plan designs to renovate an existing structure.
Council discussed proposed layout design for an existing stand-alone building with Moorse.
Jakel questioned the life cycle of the proposed stand-alone site. Beahen stated it should accommodate growth up to 30 to 45 officers; 15 to 20 years or more.
Finance Director Wieland provided two copies of a proposed Financial Management Plan (FMP); one illustrating a $5 million option (option one), the other the $3.1 million option (option two). Wieland proceeded through option one stating it would add $425,000 per year in debt service with no use of fund balance. With the impact of the public safety building and other factors worked into the FMP, the tax rate would increase from the existing 38.2% to 40.6%. Wieland further explained the option one FMP and the use of LGA and capital sinking funds.
Stahmer discussed the $5 million option still having the timing problems of the community room, state bonding funds, etc. If we are still looking at this as an option, then we are looking at next May to find out if we are awarded any State bonding funds. Wieland discussed the timeline with the $5 million option for financing and start of construction.
The second option of the FMP handed out is for the stand alone building using Moorse's cost estimates of $3.1 million. The option assumes the purchase of the site using existing fund balance plus the 2013 capital sinking fund amount, leaving $2.4 million to borrow. This option does not displace the community room. This would result in $199,000 in annual debt service. With the use of the capital sinking fund dollars, the tax rate goes from 38.2% to 40.1%.
Hall asked how the asset affects the government's finance. Wieland explained the way we record the assets and depreciation. We still have the asset that could be sold in the future for the value of the building.
Staff discussed taxes and cost of operating. Stahmer discussed the advantages of moving into a stand-alone site.
Then discussed was an in between option...doing the $820,000 build out at the fire station for an EOC and the stand alone police station (option two). This would add about $60,000 more in debt service and assuming all other information from the second option discussed. This would require the borrowing of $3.1 million.
Wieland stated we would be able to sell bonds sooner and would need 90 days to go through the work, under option two. If we sold bonds in 2013, we would have a full year's worth of interest to pay. Staff discussed the process of the CIP bonds and the work involved.
Ihli asked about the grant applied for with the state. Staff stated that it would need to be amended or reapplied for. There was a discussion regarding reapplying for the grant with the good argument for the EOC and the needs of the fire department.
Council and staff discussed if they were to go the route of the second option, it leaves the current police department site open for future possibilities.
Bunting suggested using a portion of the existing police department for a senior center.
Jakel considered the concept of opening up the corner (city owned property at John Deere Lane and Main Street) for senior development/apartments.
Stahmer discussed some ongoing costs of keeping the facility open.
Council and staff discussed some of the necessary renovations that would to be made to the existing site before it could become a senior center.
Staff was asked to put together some options and numbers for the existing police department site.
Bunting discussed the options moving forward with the police department. Cutting $2 million in cost makes sense. Bunting stated it provides the City options for a future EOC. In talking with the Chief and Public Safety Task Force, he is personally in favor of moving forward with the stand-alone option stating it gives the City the ability to move forward and focus on other big ticket items; it seems to be a cost efficient way of moving forward.
Ihli agreed that $3.1 million is more tolerable that $5.1 million. Hall stated the City would be getting an asset that you could use for a long period of time.
Wieland stated it is important to know the thoughts of using fund balance. Using $700k would drop fund balance to 56%. There was a discussion on use of fund balance and the City's fund balance policy.
Bunting stated are there any other projects that the City wants to consider using the reserves for. Bunting discussed use of funds for an EOC.
Jakel stated he is leaning toward option two; a stand-alone site. Spending down the reserve balance and the bottom line seems palatable. Jakel stated he would caution that the pavement management plan numbers are not currently included in the FMP. Jakel asked that at the next budget meeting, staff incorporate the pavement management plan into the FMP.
Jakel stated at this meeting we should agree on an option and at a future work session discuss how we are going to finance it.
Stanley stated she financially supports option two as well. Questioned how we are going to sell this to the community stating it is important to do some open houses with the public
Beahen was asked to share a story. Beahen shared a story of former Hassan residents visiting the current police department for a birthday party and the reaction of the residents regarding the current facility. The residents wanting to create an awareness regarding the need for a new department.
Stahmer stated it is important to create some awareness. However, if we are moving forward quickly, we need to accelerate that process.
Hall stated option two might be easier to sell than $5.1 million.
Council consensus is to pursue the second option, pulling together financing, working on presenting an offer in the near future, and creating an awareness plan/marketing plan.
Hall commented on where push back from residents may come from.
Jakel asked regarding an EOC, what the needs are for the foreseeable future and also discussed about what other buildings in town could be used in that type of instance mentioning the Field House at the High School being dedicated space for the City. Jakel stated he shared that thought with the Public Safety Task Force, but wanted to share it with the whole Council.
Feist reported on how the various City properties are designated for different functions in the event of an emergency stating the EOC is at the fire department.
3. Other Business
Jakel moved, Ihli seconded a motion to adjourn at 6:48 p.m. Motion carried 5-0.
Assistant City Administrator/Clerk