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HomeMy WebLinkAboutCouncil Workshop Minutes 05.11.2010 MINUTES COUNCIL WORKSHOP MAY 11, 2010 6:30 P.M. COUNCIL CHAMBERS I i A Council Workshop was held in the Council Chambers and called to order by Mayor Ken Olson at 6:30 p.m. on May 11, 2010. COUNCIL MEMBERS PRESENT: Emelie Eaton _x_ Doug Poehls _x_ Kate Hart _x_ Mark Mace _x Chuck Rodgers Chuck Dickerson x Alex Wilkins Norm Stamper OTHERS PRESENT: Sam Painter James Caniglia Bill Sheridan Chad Hanson, Great West Engineering Kurt Markegard Stephanie Seymanski, Morrison - Maierle Public Input (three - minute limit): Citizens may address the Council regarding any item of City business not on the agenda. The duration for an individual speaking under Public Input is limited to three minutes. While all comments are welcome, the Council will not take action on any item not on the agenda. There was no public input. General items There were none. Public Works Department: • Presentation — Solar PV for the Water Treatment Plant Bill Sheridan stated that the owner of Sundance Solar Systems of Red Lodge was scheduled to speak tonight but was unable to attend. The presentation will be on the May 25 council workshop agenda. The objective is to create a solar system that would be placed on the water treatment plant. The project will be financed through the NorthWestern Energy Universal System Benefit Program. Contracts should be available at the next council workshop. • Great West Engineering — Update on water fill station Kurt Markegard stated that Chad Hanson, Great West Engineering, is working on the costs associated with the water fill station. Chad Hanson stated that he met Kurt and Matt at the site last week to review some specific details they want incorporated into the site design. Chad is working on the final cost estimates with options for the bulk water station, the financials, and proposed options for financing. He contacted the surrounding communities to compile a comparison of area bulk water rates. Chad distributed copies of the comparison to the council, and a copy is attached to these minutes. Chad will review whether the city should use Water Fund reserves or SRF funding for the water fill station. The charge of $6.80 per 1,000 gallons for bulk water was calculated on the existing O &M and debt capacity. His Council Workshop Minutes of May 11, 2010 recommendation for a water fill station could be to charge $7.00 per 1,000 gallons and use the extra $.20 towards capital costs of installation. The recommended site is at the city shop. Mayor Olson asked if there was any public comment. Cindy Fox, 9407 Laurel Airport Road, stated: "The first thing I would like to comment is how you don't think you are out of line here. Like I said before, 75 percent of all standpipes in Montana are individually owned and they are all 50 gallons per quarter, every one of them. I also have some other updates." Cindy then read from prepared notes, and a copy of the statement is attached to these council workshop minutes. Her ending statement was: "You haven't even asked if we are going to keep our standpipe open. The answer is yes we are, and we are expecting to be grandfathered in just like what is happening in Billings with the marijuana thing. You can't just say all the sudden, oh, gee, we changed our mind here. That's, we'll take you to court. Thank you." Mayor Olson asked Cindy for a copy of her statement. Doug Poehls stated that, when he made the motion to move the bulk water rate increase to June, he did not say that the city needs to run anyone out of business. He had said that the city needed to think about the rate increase and to give the current bulk rate supplier a chance to look at their business model. That was his premise, not that the council would want to put anybody out of business. The council needs to know that the city is doing the citizens of Laurel due justice in supplying water at the same rate for anybody out of town as people pay for it in town. The fact is that the citizens should not subsidize people who have chosen to live outside the city limits of Laurel, and that is the premise he still stands on. • Resolution — Roma's request for a right -of -way easement across certain City property Kurt explained that Jack Roma requested a road easement across city property adjacent to his land in order to access his land off a different road on Valley Drive. The requirements stated in the resolution include: the road has to be surveyed and an appropriate right -of -way easement has to be compiled, filed and approved by city staff and the council; the road must be paved and designed by a professional engineer and construction to Montana Public Works Standards; the road plan and design must be reviewed by city staff prior to construction to ensure water runoff is alleviated; the fence must be replaced; the road shall remain private with Jack and Paulette Roma; the Romas shall obtain permission from the Yellowstone County Commission to construct an acceptable approach; and the annual payment of $600 for the right -of -way easement. City planner, James Caniglia, had added a letter regarding his concerns about having this road and annexation of the property. A map showing the existing waterline and the proposed easement was attached to the resolution. The proposed road would go right over the city's existing waterline. Mayor Olson stated that Bill Sheridan also wrote a letter for the council to review. The letter states the conditions that staff recommends the council consider in going forward with the request. One issue is the potable drinking water. The Romas are currently serviced by city water outside the city limits, but the city would not allow an additional service going from an established property to another building on the property. 2 Council Workshop Minutes of May 11, 2010 James Caniglia stated that, when people want to subdivide in the county and they are very close to the city limits, he usually fmds a way to tell them they cannot. This issue has nothing to do with planning at this stage in the process, but it runs counter to what he does in planning. Jack Roma's request was denied ten years ago on the basis that he could get the easement if he annexed, which James thought was a good recommendation by the Street and Alley Committee. His concern about the property as far as future annexation goes is that, if Jack gets the easement and builds one house, that house will be more or less in the center of the east half of the property, which would make further subdivision very difficult. It will not be cheap to hook up to sewer from that location, and if only a few houses can be subdivided there, it will probably never happen. With 41/2 acres, there could be quite a few houses and something could be done in the future. Doug thanked James for finding the 1998 information, which showed that this was requested before and the city council did not think it was a good idea then. Doug does not see any changes to the proposal since 1998 and is not sure it would be beneficial to the city at this point. There was discussion regarding the certificate of survey, the location of the property, and the owners of the north/south property, and the lease agreement at that location. The lease is a month -to -month lease with a two -week notice to modify it. Mayor Olson stated that the lease in reference has been on the books for twenty -five to thirty years. • Resolution — Change Order No. 7, Wage Rate Modifications for the 2009 Water System Improvements Project Kurt stated that the modification is needed because SRF received Federal funds from the American Reinvestment and Recovery Act (ARRA), which requires Federal Davis -Bacon wages. Chad Hanson explained that SRF was required by Federal regulations to start using Davis -Bacon instead of State prevailing wages for everything from October 30 on, and Laurel closed the loan on November 1s COP Construction had to review their payrolls in order to provide the needed reimbursement to their employees. • Resolution — Change Order No. 8, Reconciliation for the 2009 Water System Improvements Project Kurt stated that the resolution is to pay the contractor for additional materials. Chad explained that there are always pluses and minuses on the line items for a project. At the end of every project, a reconciliation change order is needed so the contract amount matches the actual units of quantities installed. Imported backfill was a big item with this project. • Resolution — Change order with Engineered Structures for grit removal Kurt stated that the agenda says grit removal, but that change order is not ready yet. Change Order No. 2 is a compilation of the Phase 2A1 project. Stephanie Seymanski, Morrison - Maierle, attended the meeting to provide an explanation of the change order requests, which were consolidated into one change order. Stephanie stated that the total of Change Order No. 2 is $23,243.64 and an additional 47 days. Change Order Request No. 4 was to get underneath a 6 -inch sludge line at the wastewater treatment plant that was not anticipated during construction. It pays for the time to get under it and for the 3 Council Workshop Minutes of May 11, 2010 materials, which was a 45- degree bend to get underneath the sludge line. Change Order Request No. 6 is for a gate valve, which was installed right at the head works building. It was installed for the contractor's convenience, so there are no labor charges. They are requesting the material costs because the city is seeing the benefit of having the valve there, but they installed it for their benefit so they could keep the head works building in water while doing the improvements at the head works building. Kurt explained that it will benefit the city as the project at the sewer treatment plant goes forward. The city can shut the valve down without shutting off the entire plant. If the city moves forward into Phase 2A2 to do activated sludge, the entire plant will not have to be shut down in order to accommodate it. Stephanie explained that Change Order Request No. 7 is groundwater contamination standby time while waiting to find out exactly how the contaminated groundwater issue was going to be addressed. It took time to deal with DEQ and to find a feasible method to deal with the groundwater. It took some coordination between Cenex, DEQ, Morrison - Maierle, and the city, and the contractors are requesting three days of standby time. Kurt explained that a sheen was identified on the water when the contractors were getting close to the sewer treatment plant grounds and when digging at the head works building. This essentially stopped the project and the contractors were there on standby time. According to the contract, they get paid for standby time if they incur something they did not cause. DEQ was notified and then the guidelines on how to operate from then on. The decision was made to try to treat it. The contractor was going to try to skim off the oil and discharge it onto the grass. When it was opened up more, there was more sheen. They tried to collect the sheen with oil absorbent buoys but that did not work. As standby time is very costly, a decision was made to get some frac tanks, which are big water storage containers. The water was pumped into those, the project moved on, and DEQ will be dealt with later. DEQ was notified that it was not being treated or discharged and the project was moving forward. DEQ required more testing that would have taken additional days. Test results from the 1 energy labs proved that there were no harmful contaminants and DEQ then required additional testing. Additional standby costs would have been incurred if the decision had not been made to put it in frac tanks and to proceed. CHS Refinery has been a great partner in helping to mitigate this. CHS took the oil off the top of the water out of the frac tanks and hauled it at their cost. The city needs to respond to the DEQ on how this was handled and where the oil is coming from. Future discussions regarding mitigation of the issues are needed. Stephanie stated that Change Order Request No. 16 is for 4'h hours of standby time, labor to set up the pumps, labor to bring in the frac tanks, the mobilization, rental of the frac tanks, and to pay for the peat socks, or the buoys. With Change Order Request No. 8, it was known during design that the project would cross an Exxon product line. Letters were sent to all of the product line owners, including Exxon, Conoco - Phillips, Williston -Basin, but Stephanie did not receive a response from Exxon. The Exxon product line was right in the way of the waterline, so the contractors had to go under or over it. One day of standby time was used by the contractor to deal with Exxon to try to get approval to reduce the separation distance to cross the line. Four feet is preferable, but in this case it was two feet. 4 Council Workshop Minutes of May 11, 2010 There was a brief discussion regarding the legal obligation to contact an entity that does not respond to the initial letter of request. Sam stated that lack of a response from the entity does not allow the city or contractor to proceed without the entity's permission. The city cannot be negligent or damage their property. Stephanie stated that the contractor is required to have a representative on site while digging. Exxon, Williston -Basin and Conoco - Phillips had representatives on site while the contractor was digging in case something went wrong. Exxon would have thought everything was fine because they expected the pipe line to be higher than it was and thought there was a two -inch separation between the city's existing waterline and their line. Kurt explained that a lot of these lines were bored in underneath the river. Since there was not an open trench, they could document the line from the soil to the pipe, and good notes were not kept. Exxon thought it was around six or seven feet deep. The contractor went down eleven feet to try to dive under all of the utilities, but the lines were in direct conflict. Stephanie stated that Change Order Request No. 9 is a utility crossing. It was encountered last year by the water treatment plant and ESI resolved it this year. It was originally thought to be a telephone line but turned out to be a power line that was cut out of the way. The contractor hooked it right after it was located, and the change order request does not include that. It pays for the time incurred to locate it and deal with it before the contractor hooked it and broke it. Change Order Request No. 9 is void. Kurt explained that some requests from the contractor were not warranted and were voided. Stephanie stated that Change Order Requests Nos. 11 and 13 are for utility crossings that were encountered as the contractor got closer to the wastewater treatment plant. Change Order Request No. 15 is also a utility crossing that was another Williston -Basin pipeline. Change Order Request No. 16 is for the groundwater contamination standby time, additional work to have pumps on hand, and to pump into the frac tanks and rearrange the pumping system. Change Order Request No. 20 is a request for additional contract time and is a no cost change order. The contractor has requested 47 days because of the equipment manufacturing dates. The Huber Grit Washer has a long manufacture date which pushes the contract beyond the days in the contract. The substantial completion date is this Friday, and the additional time would allow another month and a half. Huber has committed to a date to have the equipment on hand. Then ESI accounted for the time needed to install the equipment and for Huber to complete the training and the on -site testing needed. The substantial completion date would be towards the end of June. • Resolution — HVAC modification for the Water Treatment Plant Kurt stated that this resolution would be presented at the next council workshop. • Resolution — Agreement for millings with Yellowstone County Kurt stated that the County wants to help improve some roads around Laurel. In exchange for some millings, the County will provide labor, materials, and equipment to rebuild Alder Avenue. The County also wants to rebuild East 8 Street and pave Fir Avenue. In exchange, the County wants the City of Laurel to take over maintenance of some county roads that adjoin city streets to facilitate pothole repair, etc. The city is willing to fill potholes, but does not want to agree to reconstruction or repavement of the roads. The MOU would allow the city to use Gas Tax funds to maintain the roads. 5 Council Workshop Minutes of May 11, 2010 Kurt stated the need to talk with the County regarding the length of the MOU. Instead of the city maintaining the roads until annexed, which could be fifty years from now, the agreement could state a ten -year clause for maintenance. Kurt suggested that the city council, mayor, and administration might not want to allocate that the city maintain county roads forever. The city would agree to maintain the roads until property owners annex or the ten -year period ends. At that time, another agreement could be approved to extend the services. Kurt will contact the County to see if that is acceptable. • Resolution — Service Agreement with North American Digester Cleaning Services Kurt explained that the agreement is for pumping services to clean out the digesters. The company will clean out the digesters in order to visually inspect to make sure the equipment and sewer treatment plant processes continue through the digester. The company is based in Oregon and the work will be scheduled for later this fall. Planning: • Resolution — Amendment A to the Preserve America Grant James Caniglia explained that the grant originally ended on March 31 and is being changed to May 31 The change has nothing to do with the city's contractor, who has already completed the project. Recipients of the grant are scheduled to give presentations to the State next week. The Federal government, which was giving out the money, requested the change. • Update on the Bus Transit System James stated that more updates will be given soon. Bill and James recently met with the State on the topic and were informed about what needs to be done. A public meeting is needed to get input on accepting the transportation grant for the service. The State wants an organizational chart and the city council needs to approve a coordination plan, which is being done with the Council on Aging. The Council on Aging currently provides 20 hours of service a week of demand response and one trip a week to Billings, which is a little over 20 hours a week. They do not receive any grant money now, but with the coordination, they could receive the 54 percent reimbursement from the State. The State wants the city to provide the dispatching. The State would reimburse the city for the dispatching and any man hours, which would help reduce the labor costs. In addition to the coordination plan, the council would need to approve a resolution to accept the grant. James prepared an estimated budget with the grant, but it is difficult to figure out the costs of labor, gas, and expenses. The State has said that the first year will be a huge learning experience, as things will be different than expected. Chief Administrative Officer: • Resolution — Agreement with Blue Cross Blue Shield for employee health insurance Bill has met with the BCBS representative several times, and Cathy Gabrian has helped create a smooth process to move from MMIA to BCBS. Employees can choose between an 80/20 plan and a 70/30 plan. The resolution will be on the May 18 council agenda, and the BCBS plan will be effective on July 1 Executive Review: • Council Issues: o Letter from DEQ regarding oil at the Wastewater Treatment Plant (Emelie Eaton) Mayor Olson stated that the letter was addressed to the CHS Refinery and the City of Laurel. The letter asked the City of Laurel and CHS to partner together to address DEQ's concerns. Mayor Olson 6 Council Workshop Minutes of May 11, 2010 stated that CHS and the city are working together to come to a resolve, and the council will be kept informed of the progress. o Resolution — Laurel Lions Club planting 7 to 10 evergreen trees at South Pond (DNRC Grant) (Emelie Eaton) Mayor Olson stated that the Laurel Lions Club is willing to donate seven to ten trees if the city council approves of planting the trees in the Laurel Lions Family Park at South Pond. A major project there includes planting several trees and installation of a drip line watering irrigation system. Mayor Olson stated that the City of Laurel greatly appreciates the Lions Club's participation in the program. o Update regarding electrical repairs in the council chambers (Emelie Eaton) Bill Sheridan explained that ACE Electric reviewed the issue. Adequate power could come from the existing service, but there is not enough room for electrical breakers in the existing boiler room. A new breaker panel is needed to allow access from the electrical service. When a proposal is received, the information will be distributed to the council. Other items • Resolution — Proof of Loss Statement to MMIA for replacement of the library roof Mayor Olson explained correspondence from MMIA, the city's insurance carrier, indicating their participation of $28,500, minus the $2,500 deductible, for a total of $26,000 for replacement of the library roof. The resolution will be on the May 18 council agenda. Mayor Olson explained the options for Ordinance 010 -02. The ordinance passed on first reading has $1 million insurance requirements. Option A has $500,000/$300,000 requirements for general liability and automobile liability insurances. Option B requires proof of general liability and automobile liability insurance but does not state specific amounts. A second public hearing is scheduled on May 18 Mayor Olson stated that discussion regarding the SRO agreements, the CAO contract, and the contract for legal services will be presented soon. Review of draft council agenda for May 18, 2010 The resolution for the Proof of Loss Statement to MMIA for replacement of the library roof will be added to the council agenda. Mayor Olson also added an EMS Proclamation to the agenda under the ceremonial calendar. Attendance at the May 18, 2010 council meeting All council members present will attend. Announcements Mark Mace requested the addition of two items on the May 25 council workshop agenda. The first item is the Montana Water and Wastewater Agency Response Network (WARN), which was discussed at the Public Works Committee meeting last night. The committee wants to know if the council wishes to join the group. Kurt gave a good presentation, which should also be given to the council. The second item is the viability of a sidewalk replacement program. 7 Council Workshop Minutes of May 11, 2010 Mayor Olson stated that the Arbor Day trees will be planted in Thomson Park on Thursday. The council workshop adjourned at 7:47 p.m. Respectfully submitted, Cindy Allen Council Secretary NOTE: This meeting is open to the public. This meeting is for information and discussion of the Council for the listed workshop agenda items. 8 City of Laurel, Montana Bulk Water Station Study Comparison of Area Bulk Water Rates Bridger $0.02/gal (Non- Resident) Yes $120.00 $20.00 Columbus $1.50/100 gal Yes $90.00 $15.00 1 Big Timber $14.00/1,000 gal No $84.00 $14.00 Bridger $0.01 /gal (Resident) Yes $60.00 $10.00 Fromberg $1.00/100 gal Yes $60.00 $10.00 Colstrip $20.00 Set Up + $5.00/1,000 gal No $50.00 $8.33 Miles City $5.00 User Fee + $21.70/3,000 gal Yes $48.40 $8.07 Forsyth $7.50/1,000 gal Yes $45.00 $7.50 Hardin $1.75/250 gal Yes $42.00 $7.00 !AMIDE ` Ol1; gal No SAO Hysham $6.00/1,000 gal Yes $36.00 $6.00 Lockwood $0.50/100 gal Yes $30.00 $5.00 Giendive $18.46 Base + $1.29/100 cf (748 gal) Yes $28.81 $4.80 Huntley $0.25/70 gal Yes $21.43 $3.57 Billings $2.34/100 cf (748 gal) No $18.77 $3.13 1 Laurel's bulk water rate was calculated based upon the residential rate with 6,000 gallons of usage, so 6,000 gallons was used as a baseline. 2 Set up a meter on a fire hydrant each time. Great West Engineering, Inc. Project No. 2 -07128 Task Order No. 17 S 1.) We learned that Harry Whalen from the Montana Rural Water System has no jurisdiction on setting the water rates he did for our standpipe. We were told it wasn't worth the paper it was written on. Also stated it would be taxation without representation. An example of this would be the Laurel Golf Club...who after getting 2 Toads (in 1 day) would be over the 6000 gallon that you feel our customers use per month...there bill would go up $800 minimum...that was figuring April's water. 2.) We also learned that a verbal agreement is binding when it comes to what the City of Laurel said our rates would be. The mayor Albert Ehlrick was at our house saying we could open our own standpipe. He said our rate would be the same classification as any business in Laurel with a 2" line plus the rate for at the time it was cubic feet of water not gallons. When we put the other line in when the city closed their standpipe, Larry McCann said we would be charged for a second 2" line and the going rate just like the our original one. Which is exactly how it has been the past 24 1/2 years. 3.) There is a Montana Code 69 -7 -201 Rules for operation of municipal utility which states: Each municipal utility shall adopt, with the concurrence of the municipal governing body, rules for the operation of the utility. The rules shall contain, at a minimum, those requirements of good practice which can be normally expected fro the operation of a utility. They shall define or provide for use of meter or flat -rate user charges, the classification of users, applications for service, and uses of the service. The rules shall outline the utility's procedure for discontinuance of service and reestablishment of service as well as the extension of service to users within the municipal boundaries and outside the municipal boundaries. The rule shall provide the rate increases for comparable classifications and zones outside the municipal boundaries may not exceed those set within the municipal limits under the provisions of this chapter. Which was translated to us saying any business with a 2" would be under the same rate as us and Water Specialties. They would all need to receive the close to 400% raise. • /wN C J Has your attorney checked to see if a city can go into direct competition with a private business ?? When Laurel closed there standpipe down they were told by Helena if they got out they could • not start back up beings there was a private standpipe already open. Like they said that would be the same as the city deciding to go into the concrete business and put Schesslers out of business. You can't do it. Past City Public works director said anything over a 1" line is classified as commercial or business... always has been. He said to single out one type of user is discrimination. That's how every person who gets water at the standpipe feels. Sounds like a law suit would be in order. Is it worth it ? ?? The reason Laurel got out of the standpipe was because it was costing them more to maintain the standpipe then what they were making. Standards are always being raised by the state and they were not able to meet them. It's a headache. Your on call 24/7 and believe me most of the calls come in the evening or on the weekend. 20% less quarters since the City Council didn't listen to people at Public hearing. Everyone of them said they would not shop in Laurel ever again. I'm sure another 20 -30% will go to Billings if rate increase happens. You are hurting the store owners in Laurel big time. I'II tell you how long it will take to recuperate your cost... at least 20 years....just like it did us. It took us years to show a profit...of course we had to pay for the water. I have people in Helena looking at how you have to pay for your water. keep our standpipes oin . Looking We have sacrificed much to p g g 9 back on it everything was on the back burner... the standpipe came first...we have well over $100,000 invested in this. I didn't even have new living room furniture until 2006 when my youngest son graduated from High School. You haven't even asked if we are keeping our standpipe open...yes r we }}�� a �� r } e... ,. • ® �� -: rr�py � = �o��.� -�.,A �o °1 -- . � i�- �= �tr�eaees.a � e } 'ra4 a rn ... ' cu_ t_ cL i 4 '� i,. { yli� ,z�.i.'F.`, ! t -:w {{ -- ." - 11 -0 /0 4- zt24-elp 4 1. v 6 I lad°.