MINUTES

OF THE REGULAR MEETING OF THE

EDINA CITY COUNCIL

HELD AT CITY HALL

JUNE 15, 1999 - 7:00 P.M.

ROLLCALL Answering rollcall were Members Faust, Kelly, and Mayor pro tem Maetzold.

REVISED AGENDA APPROVED Member Kelly made a motion approving adoption of the Revised Council Agenda. Member Faust seconded the motion.

Ayes: Faust, Kelly, Maetzold

Motion carried.

CONSENT AGENDA ITEMS APPROVED Motion made by Member Faust and seconded by Member Kelly approving the Council Consent Agenda as presented.

Rollcall:

Ayes: Faust, Kelly, Maetzold

Motion carried.

*MINUTES OF THE REGULAR MEETING OF JUNE 1, 1999, AND SPECIAL COUNCIL MEETINGS OF JUNE 1 AND JUNE 8, 1999, APPROVED Motion made by Member Faust and seconded by Member Kelly approving the Minutes of the June 1, 1999, Regular Council Meeting and Special Council Meetings of June 1 and June 8, 1999.

Motion carried on rollcall vote - three ayes.

RESOLUTION ADOPTED AUTHORIZING BOND SALE FOR VERNON TERRACE Attorney Gilligan explained a request has been received from Ohmega building corporation ("OBC") to refund bonds issued by the City in 1990 relating to the Vernon Terrace Project. The 1990 bonds have been called for redemption and will be redeemed on July 1, 1999. The owner of the project has requested the City to refund the bonds. The principal of the bonds is $6,255,000. The City has no liability with respect to the revenue bonds and the borrower will pay all City expenses as well as pay the normal fee for bond issuance. Attorney Gilligan noted representatives were available to answer questions.

Mayor pro tem Maetzold called for comments. None was forthcoming.

Member Kelly introduced the following resolution and moved its approval:

RESOLUTION AUTHORIZING THE

ISSUANCE OF VARIABLE RATE DEMAND

MULTIFAMILY MORTGAGE REVENUE REFUNDING BONDS

(VERNON TERRACE PROJECT)

SERIES 1999

BE IT RESOLVED by the City Council (the "Council") of the city of Edina, Minnesota (the "City") as follows:

    1. The Council has received a request from Ohmega Building Corporation, a Minnesota non-profit corporation (the "Company"), that the City undertake to refinance a multifamily rental housing development as herein described pursuant to Minnesota Statutes, Chapter 462A and 462C, as amended (the "Act"), through issuance by the City of its Variable Rate Demand Multifamily Mortgage Revenue Refunding Bonds (Vernon Terrace Project), Series 1999 in an aggregate principal amount of $6,255,000 (the "bonds"), to refund Multifamily Mortgage Revenue Refunding Bonds (Vernon Terrace Project) Series 1990 which were issued by the City in the original principal amount of $6,735,000 (the "1990 Bonds") to refund in part Multifamily Mortgage Revenue Bonds (Vernon Terrace Project) issued by the City in the original principal amount of $12,600,000 (the "Prior Bonds"). The Prior Bonds were in turn issued to refund prior obligations of the City issued to finance the acquisition, construction and installation of a 146-unit multifamily housing rental project (the "Project") together with related costs, developed on an approximately 3.5 acre parcel of land located at 5420 Vernon Avenue in the City.
    2. The Project is reserved for rental in part by persons of low and moderate income, with at least twenty percent (20%) of the units held for occupancy by families or individuals with adjusted income not in excess of eighty percent (80%) of the median family income estimated by the United States Department of Housing and Urban Development for the Minneapolis/St. Paul standard metropolitan statistical area.
    3. It is proposed that, pursuant to an Amended and Restated Loan Agreement proposed to be dated not later than July 1, 1999, between the City and the Company (the "Loan Agreement"). The City will loan the proceeds of the Bonds to the Company in order to satisfy and refund the 1990 Bonds. The Loan Repayments (as defined in the Loan Agreement) to be made by the Company under the Loan Agreement are required to be sufficient (together with revenues derived from the investment of funds and accounts relating to the Bonds) to pay the principal of, premium, if any, and interest on the Bonds when due. It is further proposed that the City assign its rights to the Loan Repayments and certain other rights under the Loan Agreement to U.S. Bank Trust National Association, in St. Paul, Minnesota (the "Trustee") as security for payment of the Bonds under an Indenture of Trust proposed to be dated not later than July 1, 1999 (the "Indenture").
    4. Prior to the date of issuance of the Prior Bonds, the City approved and submitted to the Minnesota Housing Finance Agency ("MHFA") a "financing program" for the Project as required by Minnesota Statutes, Chapter 462C, and MHFA approved the financing program, and no new or amended financing program need be submitted to MHFA in connection with the issuance of the Bonds.
    5. Forms of the following documents have been submitted to this Council for approval:
      1. the Loan Agreement;
      2. the Indenture;
      3. a Second Amendment to Mortgage (the "Second Mortgage Amendment"), which would amend the Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Financing Statement (the "Mortgage") from the Company to the Trustee dated July 1, 1990;
      4. an Amended and Restated Guaranty Agreement among Electrical Workers Local 292 Annuity and 401(k) Plan, and Electrical Workers Local No. 292 Pension Plan (each a "Guarantor", or collectively, the "Guarantors") and the Trustee;
      5. a Bond Purchase Agreement (the "bond Purchase Agreement") among the Company, the City, the Guarantors, and Dougherty Summit Securities LLC and U.S. Bancorp Piper Jaffray, Inc.(the "Underwriters");
      6. a Remarketing Agreement (the "Remarketing Agreement") between the Company, the Trustee and Dougherty Summit Securities LLC and U.S. Bancorp Piper Jaffray Inc; and
      7. Preliminary Official Statement with respect to the Bonds.
    1. It is hereby found, determined and declared that:
      1. the Project described in the Loan Agreement and Indenture referred to above constitutes a multifamily rental housing development authorized by the Act;
      2. the purpose of the Project is and the effect has been to promote the public welfare by providing additional decent, safe and sanitary rental housing opportunities for low and moderate income persons within the City;
      3. the Project is located within the City limits;
      4. the refinancing of the Project, the issuance and sale of the Bonds, the execution and delivery by the City of the Loan Agreement, the Bond Purchase Agreement, and the Indenture, and the performance of all covenants and agreements of the City contained in the Loan Agreement, the Bond Purchase Agreement, and the Indenture and of all other acts and things required under the constitution and laws of the State of Minnesota to make the Loan Agreement, the Bond Purchase Agreement, Indenture and Bonds valid and binding obligations of the City in accordance with their terms, are authorized by the Act;
      5. it is desirable that the 1990 Bonds be refunded and that the Bonds be issued by the City upon the terms set forth in the Indenture;
      6. the Loan Repayments to be made by the Company under the Loan Agreement are required to be sufficient to provide for the Prompt payment of principal of, premium, if any, and interest on the bonds issued under the Indenture when due, and the Loan Agreement and Indenture also provide that the Company is required to pay all expenses of the operation and maintenance of the Project, including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the Project premises and payable during the term of the Loan Agreement and Indenture;
      7. under the provisions of the Act, and as provided in the Loan Agreement and Indenture, the Bonds are not to be payable from or charged upon any funds other than the revenue pledged to the payment thereof; the City is not subject to any liability thereon; no holder of any Bonds shall ever have the right to compel any exercise by the City of its taxing powers to pay any of the Bonds or the interest or premium thereon, or to enforce payment thereof against any property of the City except the interests of the City in the Loan Agreement which has been assigned to the Trustee under the Indenture; and the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable upon any property of the City except the interests of the City in the Loan Agreement which has been assigned to the Trustee under the Indenture.
    1. Subject to the approval of the City Attorney and the provisions of paragraph 12 hereof, the forms of the Loan Agreement, the Second Mortgage Amendment, the Remarketing Agreement, the Amended and Restated Guaranty, the Bond Purchase Agreement, and the Indenture and exhibits hereto are approved in substantially the form submitted. The Loan Agreement, Bond Purchase Agreement, and Indenture, in substantially the form submitted, are directed to be executed in the name and on behalf of the City by the Mayor and City Manager. Copies of all the documents necessary to the transaction herein described shall be delivered, filed and recorded as provided herein and in said Loan Agreement, Bond Purchase Agreement.
    2. The distribution of the Preliminary Official Statement is hereby authorized and the City hereby authorizes the use of a final Official Statement reflecting the terms of the Bonds approved hereby for the offer and sale of the Bonds. The City had not participated in the preparation of the Official Statement and makes no representations either express or implied as to the content or adequacy thereof.
    3. The City shall proceed forthwith to issue its bonds, in the form and upon the terms and conditions set forth in the Indenture and at the initial annual interest rate of five percent (5.%) subject to adjustment as provided for in the Indenture. The aggregate principal amount of the Bonds shall be $6,255.000. The offer of the Underwriters to purchase the Bonds at the price set forth in the Bond Purchase Agreement is hereby accepted. The Mayor and the City Manager are authorized and directed to prepare and execute the Bonds as prescribed in the Indenture and to deliver them to the Trustee for authentication and delivery to the Underwriters.
    4. The Mayor and the City Manager and other officers of the City are authorized and directed to prepare and furnish to the Underwriters certified copies of all proceedings and records of the City relating to the Bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including and heretofore furnished, shall constitute representations of the City as to the truth of all statements contained herein.
    5. The approval hereby given to the various documents referred to above includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto by the City Attorney and the City officials authorized herein to execute said documents prior to their execution; said city officials are hereby authorized to approve said changes on behalf of the City. The execution of any instrument by the appropriate officer or officers of the City herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. In the absence of the officers specifically named herein, any of the documents authorized by this resolution to be executed may be executed by a person authorized to act in their absence.
    6. This Resolution shall be in full force and effect from and after its passage

Adopted this 15th day of June, 1999. Member Faust seconded the motion.

Rollcall:

Ayes: Faust, Kelly, Maetzold

Motion carried.

CLAIMS PAID Motion made by Member Kelly approving payment of the following claims as shown in detail on the Check Register dated June 9, 1999, and consisting of 33 pages: General Fund $151,114.83; Communications $12,816.33; Working Capital $34,334.57; Art Center $6,914.68; Golf Dome Fund $1,076.20; Swimming Pool Fund $12,776.39; Golf Course Fund $103,226.27; Ice Arena Fund $19,043.75; Edinborough/Centennial Lakes $27,579.44; Utility Fund $75,394.18; Storm Sewer Utility Fund $2,187.53; Recycling Program $35,102.44; Liquor Dispensary Fund $211,713.56; Construction Fund $20,250.51; TOTAL $713,530.68; and for confirmation of payment of the following claims as shown in detail on the Check Register dated June 3, 1999, and consisting of 3 pages: General Fund $220,721.41; Communications $4,572.75; Art Center $1,828.91; Golf Course Fund $200.00; Liquor Dispensary Fund $77,975.33; TOTAL $305,298.40. Member Faust seconded the motion.

Rollcall:

Ayes: Faust, Kelly, Maetzold

Motion carried.

EDINA DRAFT COMPREHENSIVE PLAN FOR YEARS 1999 - 2005 APPROVED Planner Larsen asked approval of the draft plan allowing circulation of the plan to adjacent municipalities, school districts, Hennepin County and the Metropolitan Council. They would be allowed 60 days to review the plan and see if any conflict exists between our plan and their plans. The Metropolitan Council would be checking to see if the draft plan meets all statutory requirements. Once this process is completed, staff will review whether our draft plan has conflicts with neighboring jurisdictions’ plans as well as meeting all statutory requirements. At that time, if no conflicts are found, the plan would be returned to the Council for final review and adoption.

Planner Larsen presented a summary of differences between the current plan and the new draft plan. The proposed plan is not dramatically different in approach than the current plan because the City is fully-developed and the existing plan has been periodically reviewed to keep it current. He concluded stating that the Planning Commission and Park Board have reviewed the draft plan and recommend approval.

Council comment

Mayor pro tem Maetzold re-stated there are no substantial changes to the plan just modifications and adjustments. Planner Larsen commented that many changes occurring since the initial adoption of the plan had been incorporated into the document. Mayor pro tem Maetzold asked if the Council would still have a chance to make changes. Planner Larsen replied the Council will have another opportunity to review the plan before final adoption.

Member Faust asked if some of the changes in the residential housing portion of the draft plan were because of Statutory requirements. Planner Larsen answered that when the existing plan was adopted, the State required a specified number of subsidized housing units. However, now the Livable Communities Act which is a more voluntary approach has been incorporated into the plan.

No comments were received from residents.

Member Faust made a motion approving the Draft Comprehensive Plan for Years 1999 - 2005, for review by adjacent municipalities, school districts, Hennepin County and the Metropolitan Council. Member Kelly seconded the motion.

Rollcall:

Ayes: Faust, Kelly, Maetzold

Motion carried.

WEST 76TH STREET AND EDINBOROUGH WAY TRAFFIC SIGNAL CONTROL SYSTEM IMPROVEMENT NO. TS-27 CONTINUED TO JULY 6, 1999 Engineer Hoffman explained the hearing on the West 76th Street and Edinborough Way Traffic Signal Control System Improvement No. TS-27 had been continued from the May 17, 1999, public hearing. He stated staff had notified a larger area. Responses were received from 128 property owners.

Engineer Hoffman reviewed that the proposed signal was not a part of the master plan for Centennial Lakes. However, after completion of the Edinborough Townhomes and Centennial Lakes Townhomes staff received many resident calls requesting the City install a traffic signal at West 76th Street and Edinborough Way. The traffic signal was not warranted until the addition of the new office buildings. The proposed total traffic volumes from the existing properties and the new office buildings now justify the installation.

Engineer Hoffman added the new installation would not enhance the traffic flow along West 76th Street. West 76th Street is a major planned arterial roadway running parallel to I-494 and is meant to serve intra-community and nearby community non-freeway trips. Edina, along with Bloomington and Richfield have participated in the integrated corridor management system of I-494. The proposed signal would be a safety improvement benefiting nearby properties using the intersection for access to their properties.

Engineer Hoffman reported that 50% of the Centennial Lake Homes responded to a survey taken by the homeowners’ association. Of the respondents 40% felt a traffic signal was necessary, but only 33% felt they should be assessed for the cost of installation. He noted that most responses from neighbors indicate that they believe no assessment should occur to their property but only to the office property. Engineer Hoffman added the estimated project estimate of $154,260.00 could be split as follows and assessed over three years:

50% - State Aid

25% - Office Assessment

25% - Adjacent Neighborhood Townhomes and Cooperatives

Staff received a letter from residents from the 7500 York Cooperative.

At Council’s request staff completed a 48 hour volume count on the intersection. The results of the raw data counts were:

Engineer Hoffman noted that in the West 76th Street volumes are added together and factored for time taken during the week and month, the numbers are very similar to what was on 76th Street in 1997. He said this indicated that the average annual daily traffic (AADT) has been in the 10000 to 11000 range before Centennial Lakes offices, but certainly the offices do add an increment of volume.

Upon staff's review of existing and projected conditions, it would appear that the signal is going to be necessary although staff believes it will disrupt the "through flow" on West 76th Street.

Engineer Hoffman said residents fairly strongly believe that "someone else" should finance the improvement although a considerable number perceive this improvement as necessary for public safety. A poll of the public safety zone officers from the Edina Police believe a traffic signal is needed.

Staff recommends approval of the project and also recommends a final decision be made on the split of the assessment at the special assessment hearing. Current information would suggest those north of West 76th Street do not favor assessment but very few comments have been received from Edinborough Townhomes suggesting that special assessment of a small portion may be appropriate.

Mayor pro tem Maetzold called for public comment. No one appeared to speak.

Mayor pro tem Maetzold noted that action on proposed Improvement TS-27, Traffic Control System at West 76th Street and Edinborough requires a 4/5 vote of the Council and therefore, would need to be continued to July 6, 1999.

Member Kelly made a motion to continue Improvement No. TS-27 to July 6, 1999. Member Faust seconded the motion.

Ayes: Faust, Kelly, Maetzold

Motion carried.

*BID AWARDED FOR FIRE DEPARTMENT COMPUTER SOFTWARE UPGRADE Motion made by Member Faust and seconded by Member Kelly for award of bid for Fire Department Computer Software Upgrade to sole bidder HTE, Inc., at $28,160.00.

Motion carried on rollcall vote - four ayes.

TRAFFIC SAFETY STAFF REVIEW OF JUNE 2, 1999, APPROVED; SECTION B.2, CONTINUED TO JULY 6, 1999 Traffic Safety Coordinator Bongaarts explained since a 4/5 Council quorum is necessary to make a decision on Section B.2, the denial of the request for STOP signs on Mirror Lakes Drive at Ayrshire Boulevard, he suggested continuing the issue to the regular Council meeting of July 6, 1999.

Member Kelly made a motion approving Section A of the Traffic Safety Staff Report of June 2, 1999, that:

    1. Letters be sent to residents on Circle West requesting their cooperation in slowing down and driving safely;
    2. NO PARKING restrictions moved back to the east side original site in the 5100 block of Lincoln Drive;
    3. Installation of a CURVE sign with advisory speed plat of 15 mph for southbound York Avenue approaching West 62nd Street;;
    4. Installation of NO TURN ON RED restrictions during the 4 PM to 6 PM rush hour, Monday through Saturday for eastbound West 49 ½ Street traffic at France Avenue ;

and Section B. 1, and B. 3; and Section C. Member Faust seconded the motion.

Rollcall:

Ayes: Faust, Kelly, Maetzold

Motion carried.

CONCERN OF RESIDENT EXPRESSED Owen Husney, 3920 West 44th Street, expressed concern with the Durr Ltd., proposed expansion approved in 1991-92. He submitted a letter dated June 14, 1999, expressing a number of reasons for his concern. Mayor pro tem Maetzold asked City Attorney Gilligan to respond to Mr. Husney's letter.

Attorney Gilligan noted the Durr Ltd. Property was rezoned in 1991-92. No development has occurred, but is planned before the end of 1999. He reported that the Council can at any time review a plans, but in this case he was unaware of any facts changing since the 1991-92 rezoning that would have a material affect on the original decision. After reviewing the issue with the City Planner he surmised that the area could possibly be more commercial than in 1991-92. Therefore, in Attorney Gilligan’s opinion the Council has no reason to change the original decision.

Mr. Husney said he has lived in his home for 5 ½ years and was shocked to learn his home would border a 40 space parking lot. The two homes owned by Mr. Durr have been allowed to deteriorate and become eyesores. He asked the plan be put on hold and the proposal be reheard.

Mr. Husney presented additional letters to the Council from, Michael P. Rock, M.D., Ellen M. Cutler, M.D., 3924 West 44th Street; Grant Leese, 4303 Eton Place; Laurine J. Ford, 3936 West 44th Street; and Patty and Ted Murphy, 4307 Eton Place, asking for the proposal to be reheard.

Mina Adamovich, President of the Edina Morningside Condominium Association, 4360 France Avenue, said the eight owners of the condominiums are aware of the commercial zoning being granted to the owner of Durr, Ltd. Since nothing had taken place, the residents believed Mr. Durr had reconsidered the expansion. She spoke for the residents and expressed disappointment with the 10,000 sq. ft. proposed addition and parking lot. She inquired what the impact on the condominiums would be if the expansion were completed. She asked the Council to reconsider the decision of 1991-92 to preserve their neighborhood.

Member Kelly asked for further background information. Planner Larsen explained that Mr. Durr had all the necessary approval he needed and the only thing left for Mr. Durr to do is to apply for a building permit. Member Kelly said waiting for 7 years before applying for a building permit is an inordinate amount of time, but it does not appear that anything could be done to revisit the issue. He suggested something be done about the dilapidated buildings. Planner Larsen said the Health Department had inspected and notified Mr. Durr of the buildings’ condition. The houses will be removed by July 15, 1999. Member Kelly inquired whether anything could be done about parking. Planner Larsen replied that a landscaping bond will be required, that a conservation restriction exists between the Durr property and Mr. Husney’s property. In this case the conservation restriction will be required to be landscaped not left in a natural state. The landscape buffer must be preserved over the long term. Member Kelly said he would not support rehearing the proposal.

Mr. Husney asked the Council for reassurance that the lighting and landscaping will be adequate to shield his home from the proposed expansion. Mayor pro tem Maetzold explained again that Mr. Durr can proceed with the proposed expansion following approval of the watershed district. There is no statute of limitations and the proposal has met all requirements.

RESIGNATION OF POLICE CHIEF NOTED Assistant Manager Anderson noted that Police Chief Bernhjelm tendered his resignation effective July 19, 1999. He has served the City for 27 years first as a Patrolman, Lieutenant and as Chief since 1993. He has taken a position as Director of Enforcement for the Minnesota Department of Natural Resources.

There being no further business on the Council Agenda, Mayor pro tem Maetzold adjourned the Council Meeting at 7:45 P.M.

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City Clerk